Eaton Vance Tax-Advantaged Global
Dividend Opportunities Fund
Supplement to Prospectus dated
February 22, 2021 and
Prospectus Supplement dated February
22, 2021
1. The following replaces corresponding disclosure under the heading
“THE ADVISER AND SUB-ADVISER” in the Prospectus Supplement:
Eaton Vance acts as the Fund’s investment adviser under an
Investment Advisory Agreement (the “Advisory Agreement”). The Adviser’s principal office is located at Two International
Place, Boston, MA 02110. Eaton Vance, its affiliates and predecessor companies have been managing assets of individuals and institutions
since 1924 and of investment companies since 1931. Prior to March 1, 2021, Eaton Vance was a wholly-owned subsidiary of Eaton Vance
Corp. (“EVC”). Eaton Vance has engaged its affiliate Eaton Vance Advisers International Ltd. (“EVAIL”),
as a sub-adviser to the Fund. Prior to March 1, 2021, EVAIL was an indirect wholly-owned subsidiary of EVC.
On March 1, 2021, Morgan Stanley acquired EVC (the “Transaction”)
and Eaton Vance and EVAIL each became an indirect, wholly-owned subsidiary of Morgan Stanley. In connection with the Transaction,
the Fund entered into a new investment advisory agreement with Eaton Vance and Eaton Vance entered into a new investment sub-advisory
agreement with EVAIL. Each such agreement was approved by shareholders prior to the consummation of the Transaction and was effective
upon its closing.
Morgan Stanley (NYSE: MS), whose principal offices are at 1585 Broadway,
New York, New York 10036, is a preeminent global financial services firm engaged in securities trading and brokerage activities,
as well as providing investment banking, research and analysis, financing and financial advisory services. As of December 31, 2020,
after giving effect to the Transaction as described above, Morgan Stanley’s asset management operations had aggregate assets
under management of approximately $1.4 trillion.
2. The following replaces corresponding disclosure under the heading
“The Investment Adviser and Sub-Adviser” in the Prospectus:
The Fund’s investment adviser is Eaton Vance Management (“Eaton
Vance” or the “Adviser”). Prior to March 1, 2021, Eaton Vance was a wholly owned subsidiary of Eaton Vance Corp.
(“EVC”). Eaton Vance has engaged its affiliate Eaton Vance Advisers International Ltd. (“EVAIL” or the
“Sub-Adviser”) as a sub-adviser to the Fund. Prior to March 1, 2021, EVAIL was an indirect, wholly-owned subsidiary
of EVC. On March 1, 2021, Morgan Stanley acquired EVC (the “Transaction”) and Eaton Vance and EVAIL each became an
indirect, wholly-owned subsidiary of Morgan Stanley.
Morgan Stanley (NYSE: MS), whose principal offices are at 1585 Broadway,
New York, New York 10036, is a preeminent global financial services firm engaged in securities trading and brokerage activities,
as well as providing investment banking, research and analysis, financing and financial advisory services. As of December 31, 2020,
after giving effect to the Transaction as described above, Morgan Stanley’s asset management operations had aggregate assets
under management of approximately $1.4 trillion.
3. The following replaces corresponding disclosure under
the heading “INVESTMENT ADVISER, ADMINISTRATOR AND SUB-ADVISER” in the Prospectus:
Eaton Vance is the Fund’s investment
adviser and administrator. Prior to March 1, 2021, Eaton Vance was a wholly-owned subsidiary of Eaton Vance Corp. (“EVC”).
On March 1, 2021, Morgan Stanley acquired EVC (the “Transaction”) and Eaton Vance became an indirect, wholly-owned
subsidiary of Morgan Stanley. As of December 31, 2020, after giving effect to the Transaction, Morgan Stanley’s
asset management operations had aggregate assets under management of approximately $1.4 trillion.
Eaton Vance has engaged its affiliate EVAIL as a sub-adviser to the
Fund. On March 1, 2021, upon the closing of the Transaction, EVAIL became an indirect, wholly-owned subsidiary of Morgan Stanley.
Prior to March 1, 2021, EVAIL was an indirect, wholly-owned subsidiary of EVC.
4. The following replaces corresponding disclosure under
the heading “Management of the Fund—The Adviser” in the Prospectus:
Eaton Vance acts as the Fund’s investment adviser
under an Investment Advisory Agreement (the “Advisory Agreement”). Eaton Vance has offices at Two International Place,
Boston, MA 02110. Eaton Vance and its predecessor organizations have been managing assets since 1924 and managing investment funds
since 1931. Prior to March 1, 2021, Eaton Vance was a wholly-owned subsidiary of Eaton Vance Corp. (“EVC”).
On March 1, 2021, Morgan Stanley acquired EVC (the “Transaction”)
and Eaton Vance became an indirect, wholly-owned subsidiary of Morgan Stanley. In connection with the Transaction, the Fund entered
into a new investment advisory agreement with Eaton Vance. The agreement was approved by shareholders prior to the consummation
of the Transaction and was effective upon its closing.
Morgan Stanley (NYSE: MS), whose principal
offices are at 1585 Broadway, New York, New York 10036, is a preeminent global financial services firm engaged in securities trading
and brokerage activities, as well as providing investment banking, research and analysis, financing and financial advisory services.
As of December 31, 2020, after giving effect to the Transaction as described above, Morgan Stanley’s asset management operations
had aggregate assets under management of approximately $1.4 trillion.
5. The following replaces corresponding disclosure under
the heading “Management of the Fund—The Sub-Adviser” in the Prospectus:
Eaton Vance has engaged its affiliate EVAIL as the Sub-Adviser to the Fund.
The Sub-Adviser’s principal office is located at 125 Old Broad Street, London, United Kingdom, EC2N 1AR, United Kingdom.
On March 1, 2021, upon the closing
of the Transaction, EVAIL became an indirect, wholly-owned subsidiary of Morgan Stanley. Prior to March 1, 2021, EVAIL was an indirect,
wholly-owned subsidiary of EVC. In connection with the Transaction, the Eaton Vance entered into a new investment sub-advisory
agreement with its sub-adviser. The agreement was approved by shareholders prior to the consummation of the Transaction and was
effective upon its closing.
6. The following replaces corresponding disclosure under
the heading “Management of the Fund—THE ADMINISTRATOR” in the Prospectus:
Eaton Vance serves as administrator of the Fund under an
Administrative Services Agreement (the “Administration Agreement”), but currently receives no compensation for providing
administrative services to the Fund. Under the Administration Agreement, Eaton Vance has been engaged to administer the Fund’s
affairs, subject to the supervision of the Board, and shall furnish office space and all necessary office facilities, equipment
and personnel for administering the affairs of the Fund.
Eaton Vance Tax-Advantaged Global Dividend
Opportunities Fund
Supplement to Statement
of Additional Information dated February 22, 2021
1. The following replaces corresponding disclosure under the heading
“TRUSTEES AND OFFICERS”:
The Board of Trustees of the Fund (the “Board”) is responsible
for the overall management and supervision of the affairs of the Fund. The Board members and officers of the Fund are listed below.
Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. Each
Trustee holds office until the annual meeting for the year in which his or her term expires and until his or her successor is elected
and qualified, subject to a prior death, resignation, retirement, disqualification or removal. Under the terms of the Fund’s
current Trustee retirement policy, an Independent Trustee must retire and resign as a Trustee on the earlier of: (i) the first
day of July following his or her 74th birthday; or (ii), with limited exception, December 31st of the 20th year in which he or
she has served as a Trustee. However, if such retirement and resignation would cause the Fund to be out of compliance with Section
16 of the 1940 Act, as amended (the “1940 Act”) or any other regulations or guidance of the Securities and Exchange
Commission (“SEC”), then such retirement and resignation will not become effective until such time as action has been
taken for the Fund to be in compliance therewith. The “noninterested Trustees” consist of those Trustees who are not
“interested persons” of the Fund, as that term is defined under the 1940 Act. The business address of each Board member
and officer is Two International Place, Boston, Massachusetts 02110. As used in this SAI, “BMR” refers to Boston Management
and Research, “EVC” refers to Eaton Vance Corp., “EV” refers to Eaton Vance, Inc., “Eaton Vance”
or “EVM” refers to Eaton Vance Management and “EVD” refers to Eaton Vance Distributors, Inc. EV is the
trustee of each of Eaton Vance and BMR. Effective March 1, 2021, each of Eaton Vance, BMR, EVD and EV are indirect wholly-owned
subsidiaries of Morgan Stanley. Each officer affiliated with Eaton Vance may hold a position with other Eaton Vance affiliates
that is comparable to his or her position with Eaton Vance listed below.
2. The following replaces the Thomas E. Faust Jr. row in the Trustees
table and in his biographical narrative in “TRUSTEES AND OFFICERS”:
THOMAS E. FAUST JR.
1958
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Class II
Trustee
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Until 2021.
3 years.
Since 2007
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Chairman of Morgan Stanley Investment Management, Inc. (MSIM),
Director and President of EV, Chief Executive Officer and President of Eaton Vance and BMR, and Director of EVD. Formerly, Chairman,
Chief Executive Officer and President of EVC. Trustee and/or officer of 141 registered investment companies. Mr. Faust is an interested
person because of his positions with MSIM, BMR, Eaton Vance, EVD and EV, which are affiliates of the Trust, and his former position
with EVC, which was an affiliate of the Trust prior to March 1, 2021.
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141
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Formerly, Director of EVC (2007-2021) and Hexavest Inc.
(2012-2021) (investment management firm).
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Thomas E. Faust Jr. Mr. Faust has served as a member of the
Eaton Vance Fund Boards since 2007. Effective March 1, 2021, he is Chairman of MSIM. He is also Director and President of EV, Chief
Executive Officer and President of Eaton Vance and BMR, and Director of EVD. Mr. Faust previously served as Chairman and Chief
Executive Officer of EVC from 2007 through March 1, 2021 and as President of EVC from 2006 through March 1, 2021. Mr. Faust served
as a Director of Hexavest Inc. from 2012-2021. From 2016 through 2019, Mr. Faust served as a Director of SigFig Wealth Management
LLC. Mr. Faust previously served as an equity analyst, portfolio manager, Director of Equity Research and Management and Chief
Investment Officer of Eaton Vance from 1985-2007. He holds B.S. degrees in Mechanical Engineering and Economics from the Massachusetts
Institute of Technology and an MBA from Harvard Business School. Mr. Faust has been a Chartered Financial Analyst since 1988. He
is a trustee and member of the executive committee of the Boston Symphony Orchestra, Inc. and trustee emeritus of Wellesley College.
3. The following replaces the second paragraph under the heading
“INVESTMENT ADVISORY AND OTHER SERVICES—The Investment Adviser”:
As described in the Prospectus, upon the closing of the transaction
by which Morgan Stanley acquired EVC (the “Transaction”), the Fund entered into a new investment advisory agreement
with Eaton Vance. The Fund will be responsible for all of its costs and expenses not expressly stated to be payable by Eaton Vance
under the Investment Advisory Agreement (the “Advisory Agreement”) or the Administrative Services Agreement
(the “Administration Agreement”).
4. The following replaces the second to last paragraph under “INVESTMENT
ADVISORY AND OTHER SERVICES—The Investment Adviser”:
The Advisory Agreement with the Adviser continues in effect through
and including the second anniversary of its execution and shall continue in full force and effect indefinitely thereafter, but
only so long as such continuance after such second anniversary is specifically approved at least annually (i) by the vote of a
majority of those Trustees of the Trust who are not interested persons of the Adviser or the Trust cast in person at a meeting
specifically called for the purpose of voting on such approval and (ii) by the Trust’s Board or by vote of a majority of
the outstanding voting securities of the Trust. The Administration Agreement continues in effect through and including the second
anniversary of its execution and shall continue in full force and effect indefinitely thereafter, but only so long as such continuance
after such second anniversary is specifically approved at least annually (i) by the Board of Trustees of the Trust and (ii) by
the vote of a majority of those Trustees of the Trust who are not interested persons of Eaton Vance or the Trust. Each Agreement
may be terminated at any time without penalty on sixty (60) days’ written notice by either party, or by vote of the majority
of the outstanding voting securities of the Trust, and the Advisory Agreement will terminate automatically in the event of its
assignment. Each Agreement provides that the investment adviser may render services to others. Each Agreement also provides that
Eaton Vance shall not be liable for any loss incurred in connection with the performance of its duties, or action taken or omitted
under the Agreements, in the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of its obligations
and duties thereunder, and Eaton Vance shall not be liable for any losses sustained in the acquisition, holding or disposition
of any security or other investment. Each Agreement is not intended to, and does not, confer upon any person not a party to it
any right, benefit or remedy of any nature, except that the new sub-advisory agreement with EVAIL (as described below) states that
the Fund is a third party beneficiary of such agreement.
5. The following replaces corresponding disclosure under the heading
“INVESTMENT ADVISORY AND OTHER SERVICES—Information About Eaton Vance”:
Eaton Vance is a business trust organized under the laws of the Commonwealth
of Massachusetts. EV serves as trustee of Eaton Vance. As described in the Prospectus, following the closing of the Transaction
on March 1, 2021, EV and Eaton Vance became indirect wholly-owned subsidiaries of Morgan Stanley (NYSE: MS), a preeminent global
financial services firm engaged in securities trading and brokerage activities, as well as providing investment banking, research
and analysis, financing and financial advisory services.
Prior to March 1, 2021, EV and Eaton Vance were wholly-owned subsidiaries
of EVC, a Maryland corporation and publicly-held holding company, and BMR was an indirect wholly-owned subsidiary of EVC. EVC,
through its subsidiaries and affiliates, engaged primarily in investment management, administration and marketing activities.
The Directors of EVC were Thomas E. Faust Jr., Ann E. Berman, Leo I. Higdon, Jr., Paula A. Johnson, Brian D. Langstraat, Dorothy
E. Puhy, Winthrop H. Smith, Jr. and Richard A. Spillane, Jr. All shares of the outstanding Voting Common Stock of EVC were deposited
in a Voting Trust, the Voting Trustees of which were Mr. Faust, Paul W. Bouchey, Craig R. Brandon, Daniel C. Cataldo, Michael
A. Cirami, Cynthia J. Clemson, James H. Evans, Maureen A. Gemma, Laurie G. Hylton, Mr. Langstraat, Thomas Lee, Frederick S. Marius,
David C. McCabe, Scott H. Page, Edward J. Perkin, Lewis R. Piantedosi, Charles B. Reed, Craig P. Russ, Thomas C. Seto, John L.
Shea, Eric A. Stein, John H. Streur, Andrew N. Sveen, Payson F. Swaffield, R. Kelly Williams and Matthew J. Witkos (all of whom
are or were officers of Eaton Vance or its affiliates). The Voting Trustees had unrestricted voting rights for the election of
Directors of EVC. Prior to March 1, 2021, all of the outstanding voting trust receipts issued under said Voting Trust were owned
by certain of the officers of BMR and Eaton Vance who may also have been officers, or officers and Directors of EVC and EV. As
indicated under “Trustees and Officers,” all of the officers of the Fund (as well as Mr. Faust who is also a Trustee)
are employees of Eaton Vance and/or BMR.
6. The following replaces corresponding disclosure under the heading
“INVESTMENT ADVISORY AND OTHER SERVICES – The Sub-Advisor.”:
EVAIL is located at 125 Old Broad Street, London, United Kingdom, EC2N 1AR.
EVAIL provides investment advice to institutional clients and pooled investment vehicles. On March 1, 2021, upon the closing of
the Transaction, EVAIL became an indirect, wholly-owned subsidiary of Morgan Stanley. Prior to March 1, 2021, EVAIL was an indirect,
wholly-owned subsidiary of EVC.
As described in the Prospectus, upon the closing of the Transaction,
Eaton Vance entered into a new investment sub-advisory agreement with EVAIL.
The Sub-Advisory
Agreement with EVAIL continues in effect through and including the second anniversary of its execution and shall continue in full
force and effect indefinitely thereafter, but only so long as such continuance after such second anniversary is specifically approved
at least annually (i) by the Fund’s Board of Trustees or by the holders of a majority of its outstanding voting securities
and (ii) by a majority of the Trustees who are not “interested persons” (as defined in the 1940 Act) of any party to
the Sub-Advisory Agreement, by vote cast in person at a meeting called for the purpose of voting on such approval. The Sub-Advisory
Agreement terminates automatically on its assignment and may be terminated without penalty on sixty (60) days’ written notice
at the option of either the Adviser, by the Fund’s Board of Trustees or by a vote of a majority (as defined in the 1940 Act)
of the Fund’s outstanding shares or by EVAIL upon three (3) months’ notice. As discussed above, Eaton Vance may terminate
the Sub-Advisory Agreement with EVAIL and directly assume responsibility for the services provided by EVAIL upon approval by the
Board of Trustees without the need for approval of the shareholders of the Fund. The
new sub-advisory agreement with Eaton Vance effective March 1, 2021 (as described above) states that the Fund is a third party
beneficiary of such agreement.
7. The following
replaces corresponding disclosure under the heading “INVESTMENT ADVISORY AND OTHER SERVICES”—“Compensation
Structure for EVM and EVAIL” and “Method to Determine Compensation.” under “Portfolio Managers.”:
Compensation Structure for EVM and EVAIL. Compensation of
the Adviser’s portfolio managers and other investment professionals has the following primary components: (1) a base salary,
(2) an annual cash bonus, and (3) annual non-cash compensation consisting of restricted shares of Morgan Stanley stock that are
subject to a fixed vesting and distribution schedule. The Adviser’s investment professionals also receive certain retirement,
insurance and other benefits that are broadly available to the Adviser’s employees. Compensation of the Adviser’s investment
professionals is reviewed primarily on an annual basis. Cash bonuses, stock-based compensation awards, and adjustments in base
salary are typically paid or put into effect at or shortly after the
December 31st fiscal year end of Morgan Stanley.
Method to Determine Compensation. The investment adviser compensates
its portfolio managers based primarily on the scale and complexity of their portfolio responsibilities and the total return performance
of managed funds and accounts versus the benchmark(s) stated in the prospectus, as well as an appropriate peer group (as described
below). In addition to rankings within peer groups of funds on the basis of absolute performance, consideration may also be given
to relative risk-adjusted performance. Risk-adjusted performance measures include, but are not limited to, the Sharpe ratio, which
uses standard deviation and excess return to determine reward per unit of risk. Performance is normally based on periods ending
on the September 30th preceding fiscal year end. Fund performance is normally evaluated primarily versus peer groups of funds as
determined by Lipper Inc. and/or Morningstar, Inc. When a fund’s peer group as determined by Lipper or Morningstar is deemed
by the investment adviser’s management not to provide a fair comparison, performance may instead be evaluated primarily against
a custom peer group or market index. In evaluating the performance of a fund and its manager, primary emphasis is normally placed
on three-year performance, with secondary consideration of performance over longer and shorter periods. For funds that are tax-managed
or otherwise have an objective of after-tax returns, performance is measured net of taxes. For other funds, performance is evaluated
on a pre-tax basis. For funds with an investment objective other than total return (such as current income), consideration will
also be
given to the fund’s success in achieving its objective.
For managers responsible for multiple funds and accounts, investment performance is evaluated on an aggregate basis, based on averages
or weighted averages among managed funds and accounts. Funds and accounts that have performance-based advisory fees are not accorded
disproportionate weightings in measuring aggregate portfolio manager performance.
The compensation of portfolio managers with other job responsibilities
(such as heading an investment group or providing analytical support to other portfolios) will include consideration of the scope
of such responsibilities and the managers’ performance in meeting them.
The investment adviser seeks to compensate portfolio managers commensurate
with their responsibilities and performance, and competitive with other firms within the investment management industry. The investment
adviser participates in investment-industry compensation surveys and utilizes survey data as a factor in determining salary, bonus
and stock-based compensation levels for portfolio managers and other investment professionals. Salaries, bonuses and stock-based
compensation are also influenced by the operating performance of the investment adviser and Morgan Stanley. The overall annual
cash bonus pool is generally based on a substantially fixed percentage of pre-bonus adjusted operating income. While the salaries
of the investment adviser’s portfolio managers are comparatively fixed, cash bonuses and stock-based compensation may fluctuate
significantly from year to year, based on changes in manager performance and other factors as described herein. For a high performing
portfolio manager, cash bonuses and stock-based compensation may represent a substantial portion of total compensation.
8. The following replaces corresponding disclosure under the heading
“INVESTMENT ADVISORY AND OTHER SERVICES—Administrative Services.”:
Under the Administration Agreement, Eaton Vance has been engaged
to administer the Fund’s affairs, subject to the supervision of the Board, and shall furnish office space and all necessary
office facilities, equipment and personnel for administering the affairs of the Fund.
9. The following replaces corresponding disclosure under the heading
“PORTFOLIO TRADING”:
Decisions concerning the execution of portfolio security transactions,
including the selection of the market and the broker-dealer firm or other financial intermediary (each an “intermediary”),
are made by the investment adviser. The Fund is responsible for the expenses associated with its portfolio transactions. The investment
adviser is also responsible for the execution of transactions for all other accounts managed by it. The investment adviser places
the portfolio security transactions for execution with one or more intermediaries. The investment adviser uses its best efforts
to obtain execution of portfolio security transactions at prices that, in the investment adviser’s judgment, are advantageous
to the client and at a reasonably competitive spread or (when a disclosed commission is being charged) at reasonably competitive
commission rates. In seeking such execution, the investment adviser will use its best judgment in evaluating the terms of a transaction,
and will give consideration to various relevant factors, which may include, without limitation, the full range and quality of the
intermediary’s services, responsiveness of the intermediary to the investment adviser, the size and type of the transaction,
the nature and character of the market for the security, the confidentiality, speed and certainty of effective execution required
for the transaction, the general execution and operational capabilities of the intermediary the reputation, reliability, experience
and financial condition of the intermediary, the value and quality of the services rendered by the intermediary in this and other
transactions, and the amount of the spread or commission, if any. In addition, the investment adviser may consider the receipt
of Research Services (as defined below), provided it does not compromise the investment adviser’s obligation to seek best
overall execution for the Fund and is otherwise in compliance with applicable law. The investment adviser may engage in portfolio
transactions with an intermediary that sells shares of Eaton Vance funds, provided such transactions are not directed to that intermediary
as compensation for the promotion or sale of such shares.
As described in the Prospectus, following the closing of the Transaction
on March 1, 2021, Eaton Vance became an “affiliated person,” as defined in the 1940 Act, of Morgan Stanley and its
affiliates, including certain intermediaries (as previously defined). As a result, Eaton Vance is subject to certain restrictions
regarding transactions with Morgan Stanley-affiliated intermediaries, as set forth in the 1940 Act. Under certain circumstances,
such restrictions may limit Eaton Vance’s ability to place portfolio transactions on behalf of a Fund
at the desired time or price. Any transaction Eaton Vance
enters into with a Morgan Stanley-affiliated intermediary on behalf of a Fund will be done in compliance with applicable laws,
rules, and regulations; will be subject to any restrictions contained in a Fund’s investment advisory agreement; will be
subject to Eaton Vance’s duty to seek best execution; and will comply with any applicable Eaton Vance policies and procedures,
as described below.
Subject to the overriding objective of obtaining the best execution
of orders and applicable rules and regulations, as described above, a Fund may use an affiliated intermediary, including a Morgan
Stanley-affiliated intermediary, to effect Fund portfolio transactions, including transactions in futures contracts and options
on futures contracts, under procedures adopted by the Board. In order to use such affiliated intermediaries, the Fund’s Board
must approve and periodically review procedures reasonably designed to ensure that commission rates and other remuneration paid
to the affiliated intermediaries are fair and reasonable in comparison to those of other intermediaries for comparable transactions
involving similar securities being purchased or sold during a comparable time period.
Pursuant to an order issued by the SEC, a Fund is permitted to engage
in principal transactions in money market instruments, subject to certain conditions, with Morgan Stanley & Co. LLC, a broker-dealer
affiliated with Morgan Stanley.
Transactions on stock exchanges and other agency transactions involve
the payment of negotiated brokerage commissions. Such commissions vary among different broker-dealer firms, and a particular broker-dealer
may charge different commissions according to such factors as the difficulty and size of the transaction and the volume of business
done with such broker-dealer. Transactions in foreign securities often involve the payment of brokerage commissions, which may
be higher than those in the United States. There is generally no stated commission in the case of securities traded in the over-the-counter
markets including transactions in fixed-income securities which are generally purchased and sold on a net basis (i.e., without
commission) through intermediaries acting for their own account rather than as brokers. Such intermediaries attempt to profit from
such transactions by buying at the bid price and selling at the higher asked price of the market for such obligations, and the
difference between the bid and asked price is customarily referred to as the spread. Fixed-income transactions may also be transacted
directly with the issuer of the obligations. In an underwritten offering the price paid often includes a disclosed fixed commission
or discount retained by the underwriter or dealer. Although spreads or commissions paid on portfolio security transactions will,
in the judgment of the investment adviser, be reasonable in relation to the value of the services provided, commissions exceeding
those which another firm might charge may be paid to intermediaries who were selected to execute transactions on behalf of the
investment adviser’s clients in part for providing brokerage and research services to the investment adviser as permitted
by applicable law.
Pursuant to the safe harbor provided in Section 28(e) of the Securities
Exchange Act of 1934, as amended (“Section 28(e)”) and to the extent permitted by other applicable law, a broker or
dealer who executes a portfolio transaction may receive a commission that is in excess of the amount of commission another broker
or dealer would have charged for effecting that transaction if the investment adviser determines in good faith that such compensation
was reasonable in relation to the value of the brokerage and research services provided. This determination may be made on the
basis of either that particular transaction or on the basis of the overall responsibility which the investment adviser and its
affiliates have for accounts over which they exercise investment discretion. “Research Services” as used herein includes
any and all brokerage and research services to the extent permitted by Section 28(e) and other applicable law. Generally, Research
Services may include, but are not limited to, such matters as research, analytical and quotation services, data, information and
other services products and materials which assist the investment adviser in the performance of its investment responsibilities.
More specifically, Research Services may include general economic, political, business and market information, industry and company
reviews, evaluations of securities and portfolio strategies and transactions, technical analysis of various aspects of the securities
markets, recommendations as to the purchase and sale of securities and other portfolio transactions, certain financial, industry
and trade publications, certain news and information services and certain research oriented computer software, data bases and services.
Any particular Research Service obtained through a broker-dealer may be used by the investment adviser in connection with client
accounts other than those accounts which pay commissions to such broker-dealer, to the extent permitted by applicable law. Any
such Research Service may be broadly useful and of value to the investment adviser in rendering investment advisory services to
all or a significant portion of its clients, or may be
relevant and useful for the management of only one client’s
account or of a few clients’ accounts, or may be useful for the management of merely a segment of certain clients’
accounts, regardless of whether any such account or accounts paid commissions to the broker-dealer through which such Research
Service was obtained. The investment adviser evaluates the nature and quality of the various Research Services obtained through
broker-dealer firms and, to the extent permitted by applicable law, may attempt to allocate sufficient portfolio security transactions
to such firms to ensure the continued receipt of Research Services which the investment adviser believes are useful or of value
to it in rendering investment advisory services to its clients. The investment adviser may also receive brokerage and Research
Services from underwriters and dealers in fixed-price offerings, when permitted under applicable law.
Research Services provided by (and produced by) broker-dealers that
execute portfolio transactions or from affiliates of executing broker-dealers are referred to as “Proprietary Research.”
Except for trades executed in jurisdictions where such consideration is not permissible, the investment adviser may and does consider
the receipt of Proprietary Research Services as a factor in selecting broker dealers to execute client portfolio transactions,
provided it does not compromise the investment adviser’s obligation to seek best overall execution. In jurisdictions where
permissible, the investment adviser also may consider the receipt of Research Services under so called “client commission
arrangements” or “commission sharing arrangements” (both referred to as “CCAs”) as a factor in selecting
broker dealers to execute transactions, provided it does not compromise the investment adviser’s obligation to seek best
overall execution. Under a CCA arrangement, the investment adviser may cause client accounts to effect transactions through a broker-dealer
and request that the broker-dealer allocate a portion of the commissions paid on those transactions to a pool of commission credits
that are paid to other firms that provide Research Services to the investment adviser. Under a CCA, the broker-dealer that provides
the Research Services need not execute the trade. Participating in CCAs may enable the investment adviser to consolidate payments
for research using accumulated client commission credits from transactions executed through a particular broker-dealer to periodically
pay for Research Services obtained from and provided by other firms, including other broker-dealers that supply Research Services.
The investment adviser believes that CCAs offer the potential to optimize the execution of trades and the acquisition of a variety
of high quality Research Services that the investment adviser might not be provided access to absent CCAs. The investment adviser
may enter into CCA arrangements with a number of broker-dealers and other firms, including certain affiliates of the investment
adviser. The investment adviser will only enter into and utilize CCAs to the extent permitted by Section 28(e) and other applicable
law.
Fund trades executed by an affiliate of the investment adviser licensed
in the United Kingdom may implicate laws of the United Kingdom, including rules of the UK Financial Conduct Authority, which govern
client trading commissions and Research Services (“UK Law”). Broadly speaking, under UK Law the investment adviser
may not accept any good or service when executing an order unless that good or service either is directly related to the execution
of trades on behalf of its clients/customers or amounts to the provision of substantive research (as defined under UK Law). These
requirements may also apply with respect to orders in connection with which the investment adviser receives goods and services
under a CCA or other bundled brokerage arrangement. Fund trades may also implicate UK Law requiring the investment adviser to direct
any research portion of a brokerage commission to an account controlled by the investment adviser.
The investment companies sponsored by the investment adviser or certain
of its affiliates also may allocate brokerage commissions to acquire information relating to the performance, fees and expenses
of such companies and other investment companies, which information is used by the members of the Board of such companies to fulfill
their responsibility to oversee the quality of the services provided to various entities, including the investment adviser, to
such companies. Such companies may also pay cash for such information.
Securities considered as investments for a Fund may also be appropriate
for other investment accounts managed by the investment adviser or certain of its affiliates. Whenever decisions are made to buy
or sell securities by a Fund and one or more of such other accounts simultaneously, the investment adviser will allocate the security
transactions (including “new” issues) in a manner which it believes to be equitable under the circumstances. As a result
of such allocations, there may be instances where a Fund will not participate in a transaction that is allocated among other accounts.
If an aggregated order cannot be filled completely, allocations will generally be made on a pro rata basis. An order may not be
allocated on a pro rata basis where, for example: (i) consideration is given to portfolio managers who have been instrumental in
developing or negotiating a particular investment; (ii) consideration is given to an account with specialized investment policies
that coincide with the particulars of a
specific investment; (iii) pro rata allocation would result
in odd-lot or de minimis amounts being allocated to a portfolio or other client; or (iv) where the investment adviser reasonably
determines that departure from a pro rata allocation is advisable. While these aggregation and allocation policies could have a
detrimental effect on the price or amount of the securities available to a Fund from time to time, it is the opinion of the members
of the Board that the benefits from the investment adviser organization outweigh any disadvantage that may arise from exposure
to simultaneous transactions.
10. The following is added as a new section immediately prior
to “FINANCIAL STATEMENTS”:
POTENTIAL CONFLICTS OF INTEREST
As a diversified global financial services firm, Morgan Stanley engages
in a broad spectrum of activities, including financial advisory services, investment management activities, lending, commercial
banking, sponsoring and managing private investment funds, engaging in broker-dealer transactions and principal securities, commodities
and foreign exchange transactions, research publication and other activities. In the ordinary course of its business, Morgan Stanley
is a full-service investment banking and financial services firm and therefore engages in activities where Morgan Stanley’s
interests or the interests of its clients may conflict with the interests of a Trust, Fund or Portfolio, if applicable, (collectively
for the purposes of this section, “Fund” or “Funds”). Morgan Stanley advises clients and sponsors, manages
or advises other investment funds and investment programs, accounts and businesses (collectively, together with the Funds, any
new or successor funds, programs, accounts or businesses, the ‘‘Affiliated Investment Accounts’’) with
a wide variety of investment objectives that in some instances may overlap or conflict with a Fund’s investment objectives
and present conflicts of interest. In addition, Morgan Stanley may also from time to time create new or successor Affiliated Investment
Accounts that may compete with a Fund and present similar conflicts of interest. The discussion below enumerates certain actual,
apparent and potential conflicts of interest. There is no assurance that conflicts of interest will be resolved in favor of Fund
shareholders and, in fact, they may not be. Conflicts of interest not described below may also exist.
Material Non-public and Other Information. It is expected
that confidential or material non-public information regarding an investment or potential investment opportunity may become available
to the investment adviser. If such information becomes available, the investment adviser may be precluded (including by applicable
law or internal policies or procedures) from pursuing an investment or disposition opportunity with respect to such investment
or investment opportunity.
The investment adviser may also from time to time be subject to contractual
‘‘stand-still’’ obligations and/or confidentiality obligations that may restrict its ability to trade in
certain investments on a Fund’s behalf. In addition, the investment adviser may be precluded from disclosing such information
to an investment team, even in circumstances in which the information would be beneficial if disclosed. Therefore, the investment
team may not be provided access to material non-public information in the possession of Morgan Stanley that might be relevant to
an investment decision to be made on behalf of a Fund, and the investment team may initiate a transaction or sell an investment
that, if such information had been known to it, may not have been undertaken. In addition, certain members of the investment team
may be recused from certain investment-related discussions so that such members do not receive information that would limit their
ability to perform functions of their employment with the investment adviser or its affiliates unrelated to that of a Fund. Furthermore,
access to certain parts of Morgan Stanley may be subject to third party confidentiality obligations and to information barriers
established by Morgan Stanley in order to manage potential conflicts of interest and regulatory restrictions, including without
limitation joint transaction restrictions pursuant to the 1940 Act. Accordingly, the investment adviser’s ability to source
investments from other business units within Morgan Stanley may be limited and there can be no assurance that the investment adviser
will be able to source any investments from any one or more parts of the Morgan Stanley network.
The investment adviser may restrict its investment decisions and
activities on behalf of the Funds in various circumstances, including because of applicable regulatory requirements or information
held by the investment adviser or Morgan Stanley. The investment adviser might not engage in transactions or other activities for,
or enforce certain rights in favor of, a Fund due to Morgan Stanley’s activities outside the Funds. In instances where trading
of an investment is restricted, the investment adviser may not be able to purchase or sell such investment on behalf of a Fund,
resulting in the Fund’s inability to participate in certain desirable transactions. This inability to
buy or sell an investment could have an adverse effect on
a Fund’s portfolio due to, among other things, changes in an investment’s value during the period its trading is restricted.
Also, in situations where the investment adviser is required to aggregate its positions with those of other Morgan Stanley business
units for position limit calculations, the investment adviser may have to refrain from making investments due to the positions
held by other Morgan Stanley business units or their clients. There may be other situations where the investment adviser refrains
from making an investment due to additional disclosure obligations, regulatory requirements, policies, and reputational risk, or
the investment adviser may limit purchases or sales of securities in respect of which Morgan Stanley is engaged in an underwriting
or other distribution capacity.
Morgan Stanley has established certain information barriers and other
policies to address the sharing of information between different businesses within Morgan Stanley. As a result of information barriers,
the investment adviser generally will not have access, or will have limited access, to certain information and personnel in other
areas of Morgan Stanley relating to business transactions for clients (including transactions in investing, banking, prime brokerage
and certain other areas), and generally will not manage the Funds with the benefit of the information held by such other areas.
Morgan Stanley, due to its access to and knowledge of funds, markets and securities based on its prime brokerage and other businesses,
may make decisions based on information or take (or refrain from taking) actions with respect to interests in investments of the
kind held (directly or indirectly) by the Funds in a manner that may be adverse to the Funds, and will not have any obligation
or other duty to share information with the investment adviser.
In limited circumstances, however, including for purposes of managing
business and reputational risk, and subject to policies and procedures, Morgan Stanley personnel, including personnel of the investment
adviser, on one side of an information barrier may have access to information and personnel on the other side of the information
barrier through “wall crossings.” The investment adviser faces conflicts of interest in determining whether to engage
in such wall crossings. Information obtained in connection with such wall crossings may limit or restrict the ability of the investment
adviser to engage in or otherwise effect transactions on behalf of the Funds (including purchasing or selling securities that the
investment adviser may otherwise have purchased or sold for a Fund in the absence of a wall crossing). In managing conflicts of
interest that arise because of the foregoing, the investment adviser generally will be subject to fiduciary requirements. The investment
adviser may also implement internal information barriers or ethical walls, and the conflicts described herein with respect to information
barriers and otherwise with respect to Morgan Stanley and the investment adviser will also apply internally within the investment
adviser. As a result, a Fund may not be permitted to transact in (e.g., dispose of a security in whole or in part) during periods
when it otherwise would have been able to do so, which could adversely affect a Fund. Other investors in the security that are
not subject to such restrictions may be able to transact in the security during such periods. There may also be circumstances in
which, as a result of information held by certain portfolio management teams in the investment adviser, the investment adviser
limits an activity or transaction for a Fund, including if the Fund is managed by a portfolio management team other than the team
holding such information.
Investments by Morgan Stanley and its Affiliated Investment Accounts.
In serving in multiple capacities to Affiliated Investment Accounts, Morgan Stanley, including the investment adviser and its
investment teams, may have obligations to other clients or investors in Affiliated Investment Accounts, the fulfillment of which
may not be in the best interests of a Fund or its shareholders. A Fund’s investment objectives may overlap with the investment
objectives of certain Affiliated Investment Accounts. As a result, the members of an investment team may face conflicts in the
allocation of suitable investment opportunities among a Fund and other investment funds, programs, accounts and businesses advised
by or affiliated with the investment adviser. Certain Affiliated Investment Accounts may provide for higher management or incentive
fees or greater expense reimbursements or overhead allocations, all of which may contribute to this conflict of interest and create
an incentive for the investment adviser to favor such other accounts.
Morgan Stanley currently invests and plans to continue to invest
on its own behalf and on behalf of its Affiliated Investment Accounts in a wide variety of investment opportunities globally. Morgan
Stanley and its Affiliated Investment Accounts, to the extent consistent with applicable law and policies and procedures, will
be permitted to invest in investment opportunities without making such opportunities available to a Fund beforehand. Subject to
the foregoing, Morgan Stanley may offer investments that fall into the investment objectives of an Affiliated Investment Account
to such account or make such investment on its own behalf, even though such investment
also falls within a Fund’s investment objectives. A
Fund may invest in opportunities that Morgan Stanley and/or one or more Affiliated Investment Accounts has declined, and vice versa.
All of the foregoing may reduce the number of investment opportunities available to a Fund and may create conflicts of interest
in allocating investment opportunities. Investors should note that the conflicts inherent in making such allocation decisions may
not always be resolved to a Fund’s advantage. There can be no assurance that a Fund will have an opportunity to participate
in certain opportunities that fall within their investment objectives.
To seek to reduce potential conflicts of interest and to attempt
to allocate such investment opportunities in a fair and equitable manner, the investment adviser has implemented allocation policies
and procedures. These policies and procedures are intended to give all clients of the investment adviser, including the Funds,
fair access to investment opportunities consistent with the requirements of organizational documents, investment strategies, applicable
laws and regulations, and the fiduciary duties of the investment adviser. Each client of the investment adviser that is subject
to the allocation policies and procedures, including each Fund, is assigned an investment team and portfolio manager(s) by the
investment adviser. The investment team and portfolio managers review investment opportunities and will decide with respect to
the allocation of each opportunity considering various factors and in accordance with the allocation policies and procedures. The
allocation policies and procedures are subject to change. Investors should note that the conflicts inherent in making such allocation
decisions may not always be resolved to the advantage of a Fund.
It is possible that Morgan Stanley or an Affiliated Investment Account,
including another Eaton Vance fund, will invest in or advise a company that is or becomes a competitor of a company of which a
Fund holds an investment. Such investment could create a conflict between the Fund, on the one hand, and Morgan Stanley or the
Affiliated Investment Account, on the other hand. In such a situation, Morgan Stanley may also have a conflict in the allocation
of its own resources to the portfolio investment. Furthermore, certain Affiliated Investment Accounts will be focused primarily
on investing in other funds which may have strategies that overlap and/or directly conflict and compete with a Fund.
In addition, certain investment professionals who are involved in
a Fund’s activities remain responsible for the investment activities of other Affiliated Investment Accounts managed by the
investment adviser and its affiliates, and they will devote time to the management of such investments and other newly created
Affiliated Investment Accounts (whether in the form of funds, separate accounts or other vehicles), as well as their own investments.
In addition, in connection with the management of investments for other Affiliated Investment Accounts, members of Morgan Stanley
and its affiliates may serve on the boards of directors of or advise companies which may compete with a Fund’s portfolio
investments. Moreover, these Affiliated Investment Accounts managed by Morgan Stanley and its affiliates may pursue investment
opportunities that may also be suitable for a Fund.
It should be noted that Morgan Stanley may, directly or indirectly,
make large investments in certain of its Affiliated Investment Accounts, and accordingly Morgan Stanley’s investment in a
Fund may not be a determining factor in the outcome of any of the foregoing conflicts. Nothing herein restricts or in any way limits
the activities of Morgan Stanley, including its ability to buy or sell interests in, or provide financing to, equity and/or debt
instruments, funds or portfolio companies, for its own accounts or for the accounts of Affiliated Investment Accounts or other
investment funds or clients in accordance with applicable law.
Different clients of the investment adviser, including a Fund, may
invest in different classes of securities of the same issuer, depending on the respective clients’ investment objectives
and policies. As a result, the investment adviser and its affiliates, at times, will seek to satisfy fiduciary obligations to certain
clients owning one class of securities of a particular issuer by pursuing or enforcing rights on behalf of those clients with respect
to such class of securities, and those activities may have an adverse effect on another client which owns a different class of
securities of such issuer. For example, if one client holds debt securities of an issuer and another client holds equity securities
of the same issuer, if the issuer experiences financial or operational challenges, the investment adviser and its affiliates may
seek a liquidation of the issuer on behalf of the client that holds the debt securities, whereas the client holding the equity
securities may benefit from a reorganization of the issuer. Thus, in such situations, the actions taken by the investment adviser
or its affiliates on behalf of one client can negatively impact securities held by another client. These conflicts also exist as
between the investment adviser’s clients, including the Funds, and the Affiliated Investment Accounts managed by Morgan Stanley.
The investment adviser and its affiliates may give advice and recommend
securities to other clients which may differ from advice given to, or securities recommended or bought for, a Fund even though
such other clients’ investment objectives may be similar to those of the Fund.
The investment adviser and its affiliates manage long and short portfolios.
The simultaneous management of long and short portfolios creates conflicts of interest in portfolio management and trading in that
opposite directional positions may be taken in client accounts managed by the same investment team, and creates risks such as:
(i) the risk that short sale activity could adversely affect the market value of long positions in one or more portfolios (and
vice versa) and (ii) the risks associated with the trading desk receiving opposing orders in the same security simultaneously.
The investment adviser and its affiliates have adopted policies and procedures that are reasonably designed to mitigate these conflicts.
In certain circumstances, the investment adviser invest on behalf of itself in securities and other instruments that would be appropriate
for, held by, or may fall within the investment guidelines of its clients, including a Fund. At times, the investment adviser will
give advice or take action for its own accounts that differs from, conflicts with, or is adverse to advice given or action taken
for any client.
From time to time, conflicts also arise due to the fact that certain
securities or instruments maybe held in some client accounts, including a Fund, but not in others, or the client accounts may have
different levels of holdings in certain securities or instruments, and because the accounts pay different levels of fees to the
investment adviser. In addition, at times an investment adviser investment team will give advice or take action with respect to
the investments of one or more clients that is not given or taken with respect to other clients with similar investment programs,
objectives, and strategies. Accordingly, clients with similar strategies will not always hold the same securities or instruments
or achieve the same performance. The investment adviser’s investment teams also advise clients with conflicting programs,
objectives or strategies. These conflicts also exist as between the investment adviser’s clients, including the Funds, and
the Affiliated Investment Accounts managed by Morgan Stanley.
The investment adviser maintains separate trading desks by investment
team and generally based on asset class, including two trading desks trading equity securities. These trading desks operate independently
of one another. The two equity trading desks do not share information. The separate equity trading desks may result in one desk
competing against the other desk when implementing buy and sell transactions, possibly causing certain accounts to pay more or
receive less for a security than other accounts. In addition, Morgan Stanley and its affiliates maintain separate trading desks
that operate independently of each other and do not share information with the investment adviser. The Morgan Stanley and affiliate
trading desks may compete against the investment adviser trading desks when implementing buy and sell transactions, possibly causing
certain Affiliated Investment Accounts to pay more or receive less for a security than other Affiliated Investment Accounts.
Payments to Broker-Dealers and Other Financial Intermediaries.
The investment adviser and/or EVD may pay compensation, out of their own funds and not as an expense of the Funds, to certain financial
intermediaries (which may include affiliates of the investment adviser and EVD), including recordkeepers and administrators of
various deferred compensation plans, in connection with the sale, distribution, marketing and retention of shares of the Funds
and/or shareholder servicing. For example, the investment adviser or EVD may pay additional compensation to a financial intermediary
for, among other things, promoting the sale and distribution of Fund shares, providing access to various programs, mutual fund
platforms or preferred or recommended mutual fund lists that may be offered by a financial intermediary, granting EVD access to
a financial intermediary’s financial advisors and consultants, providing assistance in the ongoing education and training
of a financial intermediary’s financial personnel, furnishing marketing support, maintaining share balances and/or for sub-accounting,
recordkeeping, administrative, shareholder or transaction processing services. Such payments are in addition to any distribution
fees, shareholder servicing fees and/or transfer agency fees that may be payable by the Funds. The additional payments may be based
on various factors, including level of sales (based on gross or net sales or some specified minimum sales or some other similar
criteria related to sales of the Funds and/or some or all other Eaton Vance funds), amount of assets invested by the financial
intermediary’s customers (which could include current or aged assets of the Funds and/or some or all other Eaton Vance funds),
a Fund’s advisory fee, some other agreed upon amount or other measures as determined from time to time by the investment
adviser and/or EVD. The amount of these payments may be different for different financial intermediaries.
The prospect of receiving, or the receipt of, additional compensation,
as described above, by financial intermediaries may provide such financial intermediaries and their financial advisors and other
salespersons with an incentive to favor sales of shares of the Funds over other investment options with respect to which these
financial intermediaries do not receive additional compensation (or receives lower levels of additional compensation). These payment
arrangements, however, will not change the price that an investor pays for shares of the Funds or the amount that the Funds receive
to invest on behalf of an investor. Investors may wish to take such payment arrangements into account when considering and evaluating
any recommendations relating to Fund shares and should review carefully any disclosures provided by financial intermediaries as
to their compensation.
Morgan Stanley Trading and Principal Investing Activities.
Notwithstanding anything to the contrary herein, Morgan Stanley will generally conduct its sales and trading businesses, publish
research and analysis, and render investment advice without regard for a Fund’s holdings, although these activities could
have an adverse impact on the value of one or more of the Fund’s investments, or could cause Morgan Stanley to have an interest
in one or more portfolio investments that is different from, and potentially adverse to that of a Fund. Furthermore, from time
to time, the investment adviser or its affiliates may invest “seed” capital in a Fund, typically to enable the Fund
to commence investment operations and/or achieve sufficient scale. The investment adviser and its affiliates may hedge such seed
capital exposure by investing in derivatives or other instruments expected to produce offsetting exposure. Such hedging transactions,
if any, would occur outside of a Fund.
Morgan Stanley’s sales and trading, financing and principal
investing businesses (whether or not specifically identified as such, and including Morgan Stanley’s trading and principal
investing businesses) will not be required to offer any investment opportunities to a Fund. These businesses may encompass, among
other things, principal trading activities as well as principal investing.
Morgan Stanley’s sales and trading, financing and principal
investing businesses have acquired or invested in, and in the future may acquire or invest in, minority and/or majority control
positions in equity or debt instruments of diverse public and/or private companies. Such activities may put Morgan Stanley in a
position to exercise contractual, voting or creditor rights, or management or other control with respect to securities or loans
of portfolio investments or other issuers, and in these instances Morgan Stanley may, in its discretion and subject to applicable
law, act to protect its own interests or interests of clients, and not a Fund’s interests.
Subject to the limitations of applicable law, a Fund may purchase
from or sell assets to, or make investments in, companies in which Morgan Stanley has or may acquire an interest, including as
an owner, creditor or counterparty.
Morgan Stanley’s Investment Banking Activities. Morgan
Stanley advises clients on a variety of mergers, acquisitions, restructuring, bankruptcy and financing transactions. Morgan Stanley
may act as an advisor to clients, including other investment funds that may compete with a Fund and with respect to investments
that a Fund may hold. Morgan Stanley may give advice and take action with respect to any of its clients or proprietary accounts
that may differ from the advice given, or may involve an action of a different timing or nature than the action taken, by a Fund.
Morgan Stanley may give advice and provide recommendations to persons competing with a Fund and/or any of a Fund’s investments
that are contrary to the Fund’s best interests and/or the best interests of any of its investments.
Morgan Stanley could be engaged in financial advising, whether on
the buy-side or sell-side, or in financing or lending assignments that could result in Morgan Stanley’s determining in its
discretion or being required to act exclusively on behalf of one or more third parties, which could limit a Fund’s ability
to transact with respect to one or more existing or potential investments. Morgan Stanley may have relationships with third-party
funds, companies or investors who may have invested in or may look to invest in portfolio companies, and there could be conflicts
between a Fund’s best interests, on the one hand, and the interests of a Morgan Stanley client or counterparty, on the other
hand.
To the extent that Morgan Stanley advises creditor or debtor companies
in the financial restructuring of companies either prior to or after filing for protection under Chapter 11 of the U.S. Bankruptcy
Code or similar laws in other jurisdictions, the investment adviser’s flexibility in making investments in such restructurings
on a Fund’s behalf may be limited. Morgan Stanley could provide investment banking services to competitors of portfolio
companies, as well as to private equity and/or private credit funds; such activities may present Morgan Stanley with a conflict
of interest vis-a-vis a Fund’s investment and may also result in a conflict in respect of the allocation of investment banking
resources to portfolio companies.
To the extent permitted by applicable law, Morgan Stanley may provide
a broad range of financial services to companies in which a Fund invests, including strategic and financial advisory services,
interim acquisition financing and other lending and underwriting or placement of securities, and Morgan Stanley generally will
be paid fees (that may include warrants or other securities) for such services. Morgan Stanley will not share any of the foregoing
interest, fees and other compensation received by it (including, for the avoidance of doubt, amounts received by the investment
adviser) with a Fund, and any advisory fees payable will not be reduced thereby.
Morgan Stanley may be engaged to act as a financial advisor to a
company in connection with the sale of such company, or subsidiaries or divisions thereof, may represent potential buyers of businesses
through its mergers and acquisition activities and may provide lending and other related financing services in connection with
such transactions. Morgan Stanley’s compensation for such activities is usually based upon realized consideration and is
usually contingent, in substantial part, upon the closing of the transaction. Under these circumstances, a Fund may be precluded
from participating in a transaction with or relating to the company being sold or participating in any financing activity related
to merger or acquisition.
To meet applicable regulatory requirements, there are periods when
the investment adviser will not engage in certain types of transactions in the securities of companies for which a broker-dealer
affiliated with Morgan Stanley is performing investment banking services. Fund shareholders will not receive notice of such instances.
In particular, when a broker-dealer affiliated with Morgan Stanley is engaged in an underwriting or other distribution of securities
of a company, the investment adviser may be prohibited from purchasing such securities on behalf of a Fund. In addition, under
certain circumstances, the investment adviser generally will not initiate transactions in the securities of companies with respect
to which affiliates of the investment adviser may have controlling interests or are affiliated.
The investment adviser believes that the nature and range of clients
to whom Morgan Stanley and its subsidiaries render investment banking and other services is such that it would be inadvisable to
exclude these companies from the Fund’s portfolio.
Morgan Stanley’s Marketing Activities. Morgan Stanley
is engaged in the business of underwriting, syndicating, brokering, administering, servicing, arranging and advising on the distribution
of a wide variety of securities and other investments in which a Fund may invest. Subject to the restrictions of the 1940 Act,
including Sections 10(f) and 17(e) thereof, a Fund may invest in transactions in which Morgan Stanley acts as underwriter, placement
agent, syndicator, broker, administrative agent, servicer, advisor, arranger or structuring agent and receives fees or other compensation
from the sponsors of such products or securities. Any fees earned by Morgan Stanley in such capacity will not be shared with the
investment adviser or the Funds. Certain conflicts of interest, in addition to the receipt of fees or other compensation, would
be inherent in these transactions. Moreover, the interests of one of Morgan Stanley’s clients with respect to an issuer of
securities in which a Fund has an investment may be adverse to the investment adviser’s or a Fund’s best interests.
In conducting the foregoing activities, Morgan Stanley will be acting for its other clients and will have no obligation to act
in the investment adviser’s or a Fund’s best interests.
Client Relationships. Morgan Stanley has existing and potential
relationships with a significant number of corporations, institutions and individuals. In providing services to its clients, Morgan
Stanley may face conflicts of interest with respect to activities recommended to or performed for such clients, on the one hand,
and a Fund, its shareholders or the entities in which the Fund invests, on the other hand. In addition, these client relationships
may present conflicts of interest in determining whether to offer certain investment opportunities to a Fund.
In acting as principal or in providing advisory and other services
to its other clients, Morgan Stanley may engage in or recommend activities with respect to a particular matter that conflict with
or are different from activities engaged in or recommended by the investment adviser on a Fund’s behalf.
Principal Investments. To the extent permitted by applicable
law, there may be situations in which a Funds’ interests may conflict with the interests of one or more general accounts
of Morgan Stanley and its affiliates or accounts managed by Morgan Stanley or its affiliates. This may occur because these accounts
hold public and private debt and equity securities of many issuers which may be or become portfolio companies, or from whom portfolio
companies may be acquired.
Transactions with Portfolio Companies of Affiliated Investment
Accounts. The companies in which a Fund may invest may be counterparties to or participants in agreements, transactions or
other arrangements with portfolio companies or other entities of portfolio investments of Affiliated Investment Accounts (for example,
a company in which a Fund invests may retain a company in which an Affiliated Investment Account invests to provide services or
may acquire an asset from such company or vice versa). Certain of these agreements, transactions and arrangements involve fees,
servicing payments, rebates and/or other benefits to Morgan Stanley or its affiliates. For example, portfolio entities may, including
at the encouragement of Morgan Stanley, enter into agreements regarding group procurement and/or vendor discounts. Morgan Stanley
and its affiliates may also participate in these agreements and may realize better pricing or discounts as a result of the participation
of portfolio entities. To the extent permitted by applicable law, certain of these agreements may provide for commissions or similar
payments and/or discounts or rebates to be paid to a portfolio entity of an Affiliated Investment Account, and such payments or
discounts or rebates may also be made directly to Morgan Stanley or its affiliates. Under these arrangements, a particular portfolio
company or other entity may benefit to a greater degree than the other participants, and the funds, investment vehicles and accounts
(which may or may not include a Fund) that own an interest in such entity will receive a greater relative benefit from the arrangements
than the Eaton Vance funds, investment vehicles or accounts that do not own an interest therein. Fees and compensation received
by portfolio companies of Affiliated Investment Accounts in relation to the foregoing will not be shared with a Fund or offset
advisory fees payable.
Investments in Portfolio Investments of Other Funds. To the
extent permitted by applicable law, when a Fund invests in certain companies or other entities, other funds affiliated with the
investment adviser may have made or may be making an investment in such companies or other entities. Other funds that have been
or may be managed by the investment adviser may invest in the companies or other entities in which a Fund has made an investment.
Under such circumstances, a Fund and such other funds may have conflicts of interest (e.g., over the terms, exit strategies and
related matters, including the exercise of remedies of their respective investments). If the interests held by a Fund are different
from (or take priority over) those held by such other funds, the investment adviser may be required to make a selection at the
time of conflicts between the interests held by such other funds and the interests held by a Fund.
Allocation of Expenses. Expenses may be incurred that are
attributable to a Fund and one or more other Affiliated Investment Accounts (including in connection with issuers in which a Fund
and such other Affiliated Investment Accounts have overlapping investments). The allocation of such expenses among such entities
raises potential conflicts of interest. The investment adviser and its affiliates intend to allocate such common expenses among
a Fund and any such other Affiliated Investment Accounts on a pro rata basis or in such other manner as the investment adviser
deems to be fair and equitable or in such other manner as may be required by applicable law.
Temporary Investments. To more efficiently invest short-term
cash balances held by a Fund, the investment adviser may invest such balances on an overnight “sweep” basis in shares
of one or more money market funds or other short-term vehicles. It is anticipated that the investment adviser to these money market
funds or other short-term vehicles may be the investment adviser (or an affiliate) to the extent permitted by applicable law, including
Rule 12d1-1 under the 1940 Act. The Fund currently invests in Eaton Vance Cash Reserves Fund, LLC (Cash Reserves Fund), an affiliated
investment company managed by Eaton Vance for this purpose. Eaton Vance does not currently receive a fee for advisory services
provided to Cash Reserves Fund.
Transactions with Affiliates. The investment adviser and any
investment sub-adviser might purchase securities from underwriters or placement agents in which a Morgan Stanley affiliate is a
member of a syndicate or selling group, as a result of which an affiliate might benefit from the purchase through receipt of a
fee or otherwise. Neither the investment adviser nor any investment sub-adviser will purchase securities on behalf of a Fund from
an affiliate that is acting as a manager of a syndicate or selling group. Purchases by the investment adviser on behalf of a Fund
from an affiliate acting as a placement agent must meet the requirements of applicable law. Furthermore, Morgan Stanley may face
conflicts of interest when the Funds use service providers affiliated with Morgan Stanley because Morgan Stanley receives greater
overall fees when they are used.
General Process for Potential Conflicts. All of the transactions
described above involve the potential for conflicts of interest between the investment adviser, related persons of the investment
adviser and/or their clients. The Advisers Act, the 1940 Act and ERISA impose certain requirements designed to decrease the possibility
of conflicts of interest between an investment adviser and its clients. In some cases, transactions may be permitted subject to
fulfillment of certain conditions. Certain other transactions may be prohibited. In addition, the investment adviser has instituted
policies and procedures designed to prevent conflicts of interest from arising and, when they do arise, to ensure that it effects
transactions for clients in a manner that is consistent with its fiduciary duty to its clients and in accordance with applicable
law. The investment adviser seeks to ensure that potential or actual conflicts of interest are appropriately resolved taking into
consideration the overriding best interests of the client.
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