SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-12
JOHN HANCOCK FUNDS II
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
JOHN HANCOCK FUNDS II
601 Congress Street
Boston, Massachusetts 02210-2805
March 30, 2006
Dear Emerging Growth Fund Shareholder:
Your vote is requested on a change involving the subadviser to the Emerging
Growth Fund (the "Fund"), one of the separate series or funds of John Hancock
Funds II (the "Trust"). In order for shareholders of the Fund to consider and
vote on the proposal, a special meeting of shareholders will be held at 601
Congress Street, Boston, Massachusetts 02210, on APRIL 25, 2006 AT 10:00 A.M.,
EASTERN TIME. We encourage you to read the enclosed materials in their entirety.
You are being asked to approve a new subadvisory agreement between John Hancock
Investment Management Services, LLC (the "Adviser") and Sovereign Asset
Management LLC ("Sovereign") for the Fund. Sovereign would be replacing MFC
Global Investment Management (U.S.A.) Limited ("MFC Global") as the subadviser
to the Emerging Growth Fund. The Board of Trustees of the Trust approved the
proposal to enter into a new subadvisory agreement with Sovereign at a meeting
held on March 30, 2006. Sovereign and the new subadvisory agreement are more
fully described in the enclosed proxy statement for your consideration.
YOUR VOTE IS IMPORTANT!
We urge you to review the enclosed proxy statement carefully, and to vote by
completing, signing and returning the enclosed proxy card to us immediately.
Your prompt response will help avoid the cost of additional mailings.
If you have any questions or need additional information, please contact a John
Hancock Funds Customer Service Representative at 1-800-225-5291.
Sincerely,
/s/ Betsy Anne Seel
Betsy Anne Seel
Secretary
John Hancock Funds II
JOHN HANCOCK FUNDS II
601 Congress Street
Boston, Massachusetts 02210-2805
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
OF THE EMERGING GROWTH FUND
TO THE SHAREHOLDERS OF
THE EMERGING GROWTH FUND:
Notice is hereby given that a special meeting of shareholders (the
"Meeting") of the Emerging Growth Fund of John Hancock Funds II (the "Trust")
will be held at 601 Congress Street, Boston, Massachusetts 02210, on APRIL 25,
2006 AT 10:00 A.M., EASTERN TIME. A Proxy Statement that provides information
about the Meeting is included with this notice. The Meeting will be held for the
following purposes:
Proposal 1 Approval of a new subadvisory agreement between John
Hancock Investment Management Services, LLC and Sovereign
Asset Management LLC for the Emerging Growth Fund.
Any other business that may properly come before the Meeting.
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS THAT SHAREHOLDERS VOTE FOR
THE PROPOSAL.
Each shareholder of record at the close of business on February 24, 2006 is
entitled to receive notice of and to vote at the Meeting.
Sincerely,
/s/ Betsy Anne Seel
Betsy Anne Seel
Secretary
John Hancock Funds II
March 30, 2006
Boston, Massachusetts
JOHN HANCOCK FUNDS II
601 Congress Street
Boston, Massachusetts 02210-2805
___________________________
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS OF THE
EMERGING GROWTH FUND TO BE HELD APRIL 25, 2006
______________
INTRODUCTION
This proxy statement (the "Proxy Statement") is furnished in connection
with the solicitation by the Board of Trustees (the "Board" or "Trustees") of
John Hancock Funds II (the "Trust") of proxies to be used at a special meeting
of shareholders of the Emerging Growth Fund to be held at 601 Congress Street,
Boston, Massachusetts 02210, on APRIL 25, 2006 AT 10:00 A.M., EASTERN TIME (the
"Meeting") for purposes of voting on the proposal summarized below. Pursuant to
the Trust's Agreement and Declaration of Trust (the "Declaration of Trust"), the
Board has designated February 24, 2006 as the record date for determining
shareholders eligible to vote at the Meeting (the "Record Date"). All
shareholders of record of the Emerging Growth Fund at the close of business on
February 24, 2006 are entitled to one vote for each share (and fractional votes
for fractional shares) of beneficial interest held. This Proxy Statement is
first being sent to shareholders on or about March 30, 2006.
THE TRUST. The Trust is an open-end management investment company, commonly
known as a mutual fund, registered under the Investment Company Act of 1940, as
amended (the "1940 Act"). The shares of the Trust are divided into 80 separate
series corresponding to the 80 registered funds (each a "Fund", and collectively
the "Funds") of the Trust. The Emerging Growth Fund is sometimes referred to
herein as "the Fund."
INVESTMENT MANAGEMENT. John Hancock Investment Management Services, LLC
(the "Adviser"), located at 601 Congress Street, Boston, Massachusetts 02210,
serves as investment adviser to the Trust and each of the Funds that has a
subadviser pursuant to an investment advisory agreement with the Trust (the
"Advisory Agreement"). As adviser to the Fund, the Adviser is responsible for,
among other things, administering the business and affairs of the Fund and
selecting, contracting with, compensating and monitoring the investment
subadvisers that manage the assets of the Fund.
THE DISTRIBUTOR. John Hancock Funds LLC, located at 601 Congress Street,
Boston, Massachusetts 02210, is the distributor for the Trust.
SUMMARY OF PROPOSAL
PROPOSAL SHAREHOLDERS OF THE TRUST
NUMBER PROPOSAL VOTING ON THE PROPOSAL
1 Approval of a new subadvisory agreement Shareholders of the
between the Adviser and Sovereign Asset Emerging Growth Fund
Management LLC for the Emerging Growth
Fund.
SHAREHOLDERS AND VOTING INFORMATION
SHAREHOLDERS OF THE FUND
Shareholders as of close of business on the Record Date are entitled to one
vote for each full share held and a fractional vote for each fractional share
held. As of ________, 2006, ___ Class NAV, ____ Class 1 and _____ Class 3 shares
of beneficial interest of the Fund were outstanding. Except as set forth in
APPENDIX A, as of ________, 2006, the Adviser is not aware of any person who
owns beneficially or of record 5% or more of any class of shares of the Fund or
25% of the total number of shares of the Fund. As of the same date, the Trustees
and officers of the Fund, as a group, owned less than 1% of any class of the
Fund's outstanding shares.
The Trust will furnish, without charge, a copy of the Trust's most recent
annual report and semi-annual report to any shareholder upon request. To obtain
a report, once available, please contact the Trust by calling 1-800-225-5291.
VOTING PROCEDURES
Proxies may be revoked at any time prior to the voting of the shares
represented thereby by: (i) mailing written instructions addressed to the
Secretary of the Trust at 601 Congress Street, Boston, Massachusetts 02210, or
(ii) signing and returning a new proxy, in each case if received by the Trust by
April 24, 2006. ALL VALID PROXIES WILL BE VOTED IN ACCORDANCE WITH
SPECIFICATIONS THEREON, OR IN THE ABSENCE OF SPECIFICATIONS, FOR APPROVAL OF THE
PROPOSAL.
QUORUM; DEFINITION OF A MAJORITY OF OUTSTANDING VOTING SECURITIES.
Shareholders of record at the close of business on the Record Date will be
entitled to vote at the Meeting or any adjournment of the Meeting. The holders
of a majority of the shares issued and outstanding and entitled to vote at the
meeting, present in person, present by means of remote communication in a
manner, if any, authorized by the Board of Trustees, or represented by proxy,
shall constitute quorum for the transaction of business. A majority of the
outstanding voting securities of the Fund entitled to vote at the close of
business on that date is required to approve the Proposal. As used in this Proxy
Statement, the vote of a "Majority of the Outstanding Voting Securities" means
the affirmative vote of the lesser of:
(1) 67% or more of the voting securities of the Fund present at the Meeting, if
the holders of more than 50% of the outstanding voting securities of the
Fund are present in person or by proxy; or
(2) more than 50% of the outstanding voting securities of the Fund.
Shareholders are entitled to one vote for each share held and fractional votes
for fractional shares held. No shares have cumulative voting rights.
In the event the necessary quorum to transact business or the vote required
to approve the Proposal is not obtained at the Meeting, the persons named as
proxies may propose one or more adjournments of the Meeting in accordance with
applicable law to permit further solicitation of proxies. Any adjournment of the
Meeting generally will require the affirmative vote of the holders of a majority
of the shares of the Trust cast at the Meeting, and any adjournment with respect
to the Proposal will require the affirmative vote of the holders of a majority
of the shares entitled to vote on the Proposal cast at the Meeting. The persons
named as proxies will vote for or against any adjournment in their discretion.
ABSTENTIONS AND BROKER NON-VOTES. Abstentions are counted as shares
eligible to vote at the Meeting in determining whether a quorum is present, but
will not be counted as votes cast with respect to the Proposal. Under the 1940
Act, the affirmative vote necessary to approve a matter under consideration may
be determined with reference to a percentage of votes present at the Meeting,
which would have the effect of treating abstentions as if they were votes
against the Proposal. If a broker or nominee holding shares in "street name"
indicates on the proxy that it does not have discretionary authority to vote as
to the Proposal, those shares will not be considered as present and entitled to
vote with respect to the Proposal. Accordingly, with respect to the Proposal,
which requires approval by a Majority of the Outstanding Voting Securities, a
broker non-vote will have no effect in determining whether the Proposal has been
adopted by a vote of "67% or more of the voting securities of the Fund present
at the Meeting, if the holders of more than 50% of the outstanding voting
securities of the Fund are present in person or by proxy" because broker
non-votes are not considered present. Broker non-votes will have the same effect
as a vote against the Proposal, however, when determining whether the Proposal
has been adopted by a vote of "more than 50% of the outstanding voting
securities of the Fund" because shares represented by a broker non-vote are
considered outstanding shares.
COST OF PREPARATION AND DISTRIBUTION OF PROXY MATERIALS. The cost of the
preparation and distribution of these proxy materials will be borne by the
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Emerging Growth Fund. In addition to the solicitation of proxies by the use of
the mails, proxies may be solicited by officers and employees of the Trust, the
Adviser and its agents or affiliates, personally or by telephone. Brokerage
houses, banks and other fiduciaries may be requested to forward soliciting
materials to their principals and to obtain authorization for the execution of
proxies. For those services, they will be reimbursed by the Trust for their
out-of-pocket expenses.
FUND VOTING. Shares of the Emerging Growth Fund will voted in the aggregate
and not by class of shares with respect to the Proposal.
3
PROPOSAL 1
APPROVAL OF NEW SUBADVISORY AGREEMENT
BETWEEN THE ADVISER AND SOVEREIGN ASSET MANAGEMENT LLC
At its meeting on March 30, 2006, the Board of Trustees, including all the
Trustees who are not "interested persons" (as defined in the 1940 Act) of the
Fund or the Adviser (the "Independent Trustees"), approved entering into a new
subadvisory agreement between the Adviser and Sovereign Asset Management LLC
("Sovereign") for the Emerging Growth Fund. Shareholders of the Emerging Growth
Fund are being asked to approve the new subadvisory agreement.
The Board approved the appointment of Sovereign as the new subadviser to
the Emerging Growth Fund and the entering of the new subadvisory agreement
between the Adviser and Sovereign, pending shareholder approval. Sovereign would
replace MFC Global Investment Management (U.S.A.) Limited ("MFC Global") as the
subadviser for the Emerging Growth Fund effective April 28, 2006. There would be
no increase in the advisory or subadvisory fees for the Emerging Growth Fund
under the new subadvisory agreement with Sovereign nor any change in services
provided to the Fund. The Board's considerations in approving the new
subadvisory agreement are described below under "Evaluation by the Board of
Trustees."
Pursuant to an order from the Securities and Exchange Commission ("SEC")
upon which the Trust relies, the Adviser, subject to Board approval, is
permitted to enter into subadvisory agreements appointing or terminating
subadvisers which are not affiliates of the Adviser (other than by reason of
serving as a subadviser to a Portfolio), and to amend the terms of subadvisory
agreements (including subadvisory fees) with respect to such subadvisers,
without shareholder approval. However, because the Adviser and Sovereign are
both indirect, wholly-owned subsidiaries of Manulife Financial Corporation
("MFC"), Sovereign is an affiliate of the Adviser. As a result, shareholders are
being asked to approve the new subadvisory agreement with Sovereign.
SOVEREIGN AND THE PROPOSED SUBADVISORY AGREEMENT
SOVEREIGN. Sovereign, a Delaware limited liability company located at 101
Huntington Avenue, Boston, Massachusetts, was founded in 1979 and is a wholly
owned subsidiary of John Hancock Financial Services, Inc. ("JHFS"). JHFS is a
subsidiary of MFC, based in Toronto, Canada. MFC is the holding company of The
Manufacturers Life Insurance Company and its subsidiaries, collectively known as
Manulife Financial.
Sovereign currently serves as subadviser to two series of the Trust,
Strategic Income Fund and Active Bond Fund. It is proposed that Sovereign
replace MFC Global as the subadviser to the Emerging Growth Fund. The change to
Sovereign as subadviser is not intended to result in any changes in the fees
charged and expenses of the Emerging Growth Fund nor any change in services
provided to the Fund. A copy of the proposed subadvisory agreement is attached
in APPENDIX B for your reference. APPENDIX C contains additional information
regarding Sovereign, including discussion regarding portfolio managers.
On December 31, 2005, as part of a reorganization, Sovereign acquired the
investment management teams of John Hancock Advisers, LLC. Sovereign is part of
the diversified investment management arm of Manulife Financial. As part of the
transfer, Sovereign assumed the responsibilities and obligations under the
subadvisory agreements previously held by John Hancock Advisers, LLC for funds
managed by the investment management teams Sovereign acquired from John Hancock
Advisers, LLC, including certain Funds of John Hancock Funds II. Sovereign, with
approximately $25 billion in assets, focuses on investment management strategies
for both institutional and retail clients.
THE PROPOSED SUBADVISORY AGREEMENT. Under the subadvisory agreement,
Sovereign would be responsible, subject to the supervision of the Board and the
Adviser, for managing the investment and reinvestment and determining the
composition of the assets of the Emerging Growth Fund. The subadvisory agreement
also provides that Sovereign will: (1) furnish all necessary investment
management and administrative facilities, at Sovereign's expense; (2) select
brokers and dealers to effect transactions and negotiate brokerage commissions
4
if applicable; recognizing that while Sovereign at all times will seek best
execution, Sovereign may, under certain circumstances, pay higher brokerage
commissions by executing portfolio transactions with brokers that provide
Sovereign with research, analysis, advice or other eligible brokerage and
research services; (3) maintain all accounts, books and records with respect to
the Fund as are required of an investment adviser to a registered investment
company pursuant to the 1940 Act and Investment Advisers Act of 1940, as amended
(the "Advisers Act") and the rules thereunder; and (4) vote proxies relating to
the Fund's investment securities in accordance with the Trust's proxy voting
policies and procedures.
The subadvisory agreement also provides that Sovereign may in certain
instances, but is not obligated to, aggregate securities purchase or sale orders
among its clients in an effort to obtain a more favorable price or lower
brokerage commission and efficient execution. In instances where securities
transactions are aggregated, Sovereign will allocate the securities so purchased
or sold, as well as the expenses incurred in the attendant transaction, in the
manner Sovereign considers to be the most equitable and consistent with its
fiduciary obligations to the Fund and its other clients.
The subadvisory agreement provides that Sovereign will not be liable to the
Adviser or the Trust for any error of judgment or mistake of law for any loss
suffered by the Adviser or Trust in connection with the matters to which the
subadvisory agreement relates except for losses resulting from willful
misfeasance, bad faith or gross negligence in the performance of, or from the
reckless disregard of, Sovereign's duties as subadviser or the duties of any of
its directors.
The subadvisory agreement provides that it may be terminated, without the
payment of any penalty, by the Trustees of the Trust, by the vote of a majority
of the outstanding voting securities of the Trust, or by the vote of a majority
of the outstanding voting securities of the Fund, on sixty days' written notice
to the Adviser and Sovereign, or by the Adviser or Sovereign on sixty days'
written notice to the Trust and the other party. The subadvisory agreement will
automatically terminate upon "assignment," as that term is defined in the 1940
Act.
Under the subadvisory agreement, the Adviser (not the Fund) will pay
Sovereign, as full compensation for all services provided and the expenses
assumed under the subadvisory agreement, a subadvisory fee at an annual rate of
0.350% of the Fund's net assets, accrued daily and paid monthly.
If approved by the Fund's shareholders, the subadvisory agreement will
become effective on the date of its execution, and will remain in effect for an
initial two-year term. Thereafter, the subadvisory agreement will continue in
effect if it is approved at least annually by a vote of the Fund's shareholders
or by the Board, provided that, in either case, continuance is approved by the
vote of a majority of the Independent Trustees, which vote must be cast in
person at a meeting called for the purpose of voting on such approval.
The description of the proposed subadvisory agreement in this section is
qualified in its entirety by the form of subadvisory agreement attached to this
Proxy Statement in APPENDIX B.
COMPARISON BETWEEN THE CURRENT SUBADVISORY AGREEMENT AND THE PROPOSED
SUBADVISORY AGREEMENT
The current subadvisory agreement and the proposed subadvisory agreement
are substantially similar. Under both agreements, the subadvisers have
substantially the same duties and the subadvisory fee rates are the same. The
principal differences are described and discussed below. The current subadvisory
agreement with MFC Global was last submitted to a vote of the Fund's
shareholders and approved on October 14, 2005.
5
SERVICES RENDERED. The proposed subadvisory agreement states that the
subadviser will provide assistance to the Trust's Custodian regarding the fair
value of securities held by the Fund for which market quotations are not readily
available whereas the current subadvisory agreement states that the subadviser
will provide fair value determinations to the Trust's Custodian to enable the
Custodian to calculate net asset value. The proposed subadvisory agreement also
expressly states that the subadviser may, but is not obligated to, aggregate
securities transactions across its clients. The current subadvisory agreement
does not prohibit aggregation of securities transactions across clients, but is
silent on the practice.
LIABILITY OF SUBADVISER. The proposed subadvisory agreement states that the
subadviser, its directors, officers or employees, will not be liable for any
error of judgment or mistake of law of for any loss suffered by the Adviser or
the Trust in connection with the matters to which the subadvisory agreement
relates except for losses resulting from willful misfeasance, bad faith, or
gross negligence in the performance of, or from the reckless disregard of, the
duties of the subadviser or any of its directors. The current subadvisory
agreement does not expressly indemnify the subadviser's directors or provide
indemnity for mistakes of law. The current subadvisory agreement also only
indemnifies the subadviser, its officers and employees for any loss suffered by
the Adviser or Trust resulting from any error of judgment made in the good faith
exercise of the subadviser's investment discretion. Both the current and
proposed subadvisory agreements provide that the subadviser is liable for losses
resulting from willful misfeasance, bad faith or gross negligence of, or
reckless disregard of, the subadviser in performing its duties.
The current subadvisory agreement states that the subadviser is also liable
for losses resulting from the willful misfeasance, bad faith or gross negligence
of, or reckless disregard of, the duties of the subadviser's officers or
employees with respect to the subadviser's investment discretion and the duties
of the subadviser's employees with respect to any other matters relating to the
subadvisory agreement. The proposed subadvisory agreement does not provide a
distinction between exercise of investment discretion and other matters relating
to the subadvisory agreement and provides that the subadviser is liable for
losses resulting from willful misfeasance, bad faith or gross negligence of, or
reckless disregard of, the duties of the subadviser's directors.
SERVICES TO OTHER CLIENTS. The proposed subadvisory agreement expressly
states that the Adviser understands and has advised the Trust's Board that the
subadviser may act as an investment adviser to fiduciary and other managed
accounts and as investment adviser or subadviser to other investment companies
and that it may give advice and take action for its other clients which differs
from advice or action taken for the Fund. The current subadvisory agreement does
not prohibit the subadviser from engaging in any such activities.
AMENDMENTS TO THE AGREEMENT. The proposed subadvisory agreement clarifies
that the agreement may be amended by the vote of a majority of the Trustees of
the Trust and a vote of a majority of the independent Trustees of the Trust cast
in person at a meeting called for the purpose of voting on such approval and
that any required shareholder approval shall be effective with respect to a fund
if a majority of the outstanding voting securities of that fund vote to approve
the amendment.
EVALUATION BY THE BOARD OF TRUSTEES
At its meeting on December 12-13, 2005, the Board of Trustees discussed
with the Adviser the Emerging Growth Fund's performance against that of its peer
group and benchmark index since inception, as well as the performance of a
similarly managed fund managed by MFC Global, and the fact that the current MFC
Global portfolio manager for the Emerging Growth Fund was being reassigned and
would no longer manage the Fund. At the Board's meeting, the Adviser recommended
to the Board that the subadviser to the Emerging Growth Fund be replaced with
another subadviser affiliated with the Adviser, Sovereign Asset Management LLC.
The Adviser made this recommendation following a review of the capabilities of
several affiliated and non affiliated investment managers to manage the Fund. As
stated above, the Board, including all the Independent Trustees, approved the
appointment of Sovereign as the new subadviser to the Emerging Growth Fund and
the new subadvisory agreement at its meeting on March 30, 2006.
The Board, including the Independent Trustees, is responsible for selecting
the Trust's investment adviser, approving the Adviser's selection of subadvisers
6
for each Fund and approving the Trust's advisory and subadvisory agreements,
their periodic continuation and any amendments. Consistent with SEC rules, the
Board regularly evaluates the Trust's advisory and subadvisory arrangements,
including consideration of the six factors listed below. The Board may also
consider other factors (including conditions and trends prevailing generally in
the economy, the securities markets and the industry) and does not treat any
single factor as determinative, and each Trustee may attribute different weights
to different factors. The Board is furnished with an analysis of its fiduciary
obligations in connection with its evaluation and, throughout the evaluation
process, the Board is assisted by counsel for the Trust and the Independent
Trustees are also separately assisted by independent legal counsel. The six
factors regularly considered by the Board are:
1. the nature, extent and quality of the services to be provided by the
Adviser to the Trust and by the subadvisers to the Funds;
2. the investment performance of the Funds and their subadvisers;
3. the extent to which economies of scale would be realized as a Fund
grows;
4. whether fee levels reflect these economies of scale for the benefit
of Trust shareholders;
5. the costs of the services to be provided and the profits to be
realized by the Adviser and its affiliates from the Adviser's
relationship with the Trust; and
6. comparative services rendered and comparative advisory and subadvisory
fee rates.
The Board believes that with respect to its evaluation of the subadvisory
agreement, in view of the Trust's "manager-of managers" advisory structure:
factors (1), (2) and (6) are of primary relevance; factors (3) and (4) generally
are less significant because the subadvisory fee is paid to the subadviser by
the Adviser and not directly by the Fund, and issues pertaining to economies of
scale are considered in connection with the approval of the advisory fee that is
paid directly by the Fund; and for similar reasons, factor (5) generally is less
significant except in those circumstances in which such attention may be
warranted because the comparative fee information considered in connection with
factor (6) indicates that the subadvisory fee will materially exceed those
normally charged under comparable circumstances.
APPROVAL OF SUBADVISORY AGREEMENT WITH SOVEREIGN. In making its
determination with respect to the new subadvisory agreement with Sovereign with
respect to the Emerging Growth Fund, and with reference to the factors described
above that the Board generally considers in reviewing subadvisory agreements,
the Board reviewed: (i) information relating to the subadviser's business which
included information such as: business performance, representative clients,
assets under management, financial stability and personnel (ii) the investment
performance of comparatively managed funds and their respective benchmarks; and
(iii) the subadvisory fee for the Fund.
The Board's decision to approve the subadvisory agreement with Sovereign
was based on a number of determinations, including the following:
(1) The performance of a similarly managed fund managed by MFC Global had lagged
that of its peer group and benchmark index;
(2) Sovereign has extensive experience and demonstrated skills as a manager with
respect to equity securities and in using a variety of investment strategies and
may be expected to provide a high quality of investment management services and
personnel to the Fund;
(3) Although not without variation, the current and historical performance of
comparable funds and other client accounts managed by Sovereign have generally
been within the range of or exceeded the performance of the Fund and its
benchmark index;
(4) The subadvisory fee rates for the Fund under Sovereign would be the same as
the subadvisory fee rates charged by MFC Global and is within industry norms;
and
(5) There would be no change in the advisory fee rates for the Fund as a result
of the new subadvisory agreement.
7
ADDITIONAL INFORMATION
For additional information about Sovereign and the new subadvisory
agreement for the Emerging Growth Fund, see APPENDIX C ("Additional Information
About Sovereign and the New Subadvisory Agreement") to this Proxy Statement.
REQUIRED VOTE
Approval of the new subadvisory agreement will require the affirmative vote
of a Majority of the Outstanding Voting Securities of the Portfolio. If the
required shareholder approval is not obtained, the current subadvisory agreement
will remain in effect pending the approval of a new subadvisory agreement or
other definitive action.
THE BOARD, INCLUDING ALL OF THE INDEPENDENT TRUSTEES, RECOMMENDS THAT
SHAREHOLDERS OF THE EMERGING GROWTH FUND VOTE "FOR" THE PROPOSAL.
OTHER MATTERS
The Board does not know of any matters to be presented at the Meeting other
than those mentioned in this Proxy Statement. If any other matters properly come
before the Meeting, the shares represented by proxies will be voted in
accordance with the best judgment of the person or persons voting the proxies.
The Trust is not required to hold annual meetings of shareholders and,
therefore, it cannot be determined when the next meeting of shareholders will be
held. Shareholder proposals to be presented at any future meeting of
shareholders of the Trust must be received by the Trust a reasonable time before
the Trust's solicitation of proxies for that meeting in order for such proposals
to be considered for inclusion in the proxy materials related to that meeting.
BY ORDER OF THE BOARD OF TRUSTEES
March 30, 2006
Boston, Massachusetts
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, SHAREHOLDERS WHO
DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO COMPLETE, SIGN, DATE
AND RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE.
8
APPENDIX A
As of ________, 2006, the following shareholders are shown on the Fund's
records as owning more than 5% of a class of its shares: [TO BE
UPDATED/PROVIDED]
B-1
APPENDIX B: PROPOSED SUBADVISORY AGREEMENT
JOHN HANCOCK FUNDS II
SUBADVISORY AGREEMENT
AGREEMENT made this __ day of April, 2006, between John Hancock Investment
Management Services, LLC, a Delaware limited liability company (the "Adviser"),
and Sovereign Asset Management LLC, a Delaware limited liability company (the
"Subadviser"). In consideration of the mutual covenants contained herein, the
parties agree as follows:
1. APPOINTMENT OF SUBADVISER
The Subadviser undertakes to act as investment subadviser to, and, subject
to the supervision of the Trustees of John Hancock Funds II (the "Trust") and
the terms of this Agreement, to manage the investment and reinvestment of the
assets of the Portfolio(s) specified in Appendix A to this Agreement as it shall
be amended by the Adviser and the Subadviser from time to time (the
"Portfolios"). The Subadviser will be an independent contractor and will have no
authority to act for or represent the Trust or Adviser in any way except as
expressly authorized in this Agreement or writing by the Trust and Adviser.
2. SERVICES TO BE RENDERED BY THE SUBADVISER TO THE TRUST
a. Subject always to the direction and control of the Trustees of the Trust,
the Subadviser will manage the investments and determine the composition of
the assets of the Portfolios in accordance with the Portfolios'
registration statement, as amended. In fulfilling its obligations to manage
the investments and reinvestments of the assets of the Portfolios, the
Subadviser will:
i. obtain and evaluate pertinent economic, statistical, financial and
other information affecting the economy generally and individual
companies or industries the securities of which are included in the
Portfolios or are under consideration for inclusion in the Portfolios;
ii. formulate and implement a continuous investment program for each
Portfolio consistent with the investment objectives and related
investment policies for each such Portfolio as described in the
Trust's registration statement, as amended;
iii. take whatever steps are necessary to implement these investment
programs by the purchase and sale of securities including the placing
of orders for such purchases and sales;
iv. regularly report to the Trustees of the Trust with respect to the
implementation of these investment programs; and
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v. provide assistance to the Trust's Custodian regarding the fair value
of securities held by the Portfolios for which market quotations are
not readily available.
b. The Subadviser, at its expense, will furnish (i) all necessary investment
and management facilities, including salaries of personnel required for it
to execute its duties faithfully, and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolios (excluding
determination of net asset value and shareholder accounting services).
c. The Subadviser will select brokers and dealers to effect all transactions
subject to the following conditions: The Subadviser will place all
necessary orders with brokers, dealers, or issuers, and will negotiate
brokerage commissions if applicable. The Subadviser is directed at all
times to seek to execute brokerage transactions for the Portfolios in
accordance with such policies or practices as may be established by the
Trustees and described in the Trust's registration statement as amended.
The Subadviser may pay a broker-dealer which provides research and
brokerage services a higher spread or commission for a particular
transaction than otherwise might have been charged by another
broker-dealer, if the Subadviser determines that the higher spread or
commission is reasonable in relation to the value of the brokerage and
research services that such broker-dealer provides, viewed in terms of
either the particular transaction or the Subadviser's overall
responsibilities with respect to accounts managed by the Subadviser. The
Subadviser may use for the benefit of the Subadviser's other clients, or
make available to companies affiliated with the Subadviser or to its
directors for the benefit of its clients, any such brokerage and research
services that the Subadviser obtains from brokers or dealers.
d. On occasions when the Subadviser deems the purchase or sale of a security
to be in the best interest of the Portfolio as well as other clients of the
Subadviser, the Subadviser to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to, aggregate the
securities to be purchased or sold to attempt to obtain a more favorable
price or lower brokerage commissions and efficient execution. In such
event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Subadviser in the
manner the Subadviser considers to be the most equitable and consistent
with its fiduciary obligations to the Portfolio and to its other clients.
e. The Subadviser will maintain all accounts, books and records with respect
to the Portfolios as are required of an investment adviser of a registered
investment company pursuant to the Investment Company Act of 1940 (the
"Investment Company Act") and Investment Advisers Act of 1940 (the
"Investment Advisers Act") and the rules thereunder.
f. The Subadviser shall vote proxies relating to the Portfolio's investment
securities in accordance with the Trust's proxy voting policies and
procedures, which provide that the Subadviser shall vote all proxies
relating to securities held by the Portfolio and, subject to the Trust's
policies and procedures, shall use proxy voting policies and procedures
adopted by the Subadviser in conformance with Rule 206(4)-6 under the
Investment Advisers Act. The Subadviser shall review its proxy voting
activities on a periodic basis with the Trustees.
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3. COMPENSATION OF SUBADVISER
The Adviser will pay the Subadviser with respect to each Portfolio the
compensation specified in Appendix A to this Agreement.
4. LIABILITY OF SUBADVISER
Neither the Subadviser nor any of its directors, officers or employees
shall be liable to the Adviser or the Trust for any error of judgment or mistake
of law or for any loss suffered by the Adviser or Trust in connection with the
matters to which this Agreement relates except for losses resulting from willful
misfeasance, bad faith or gross negligence in the performance of, or from the
reckless disregard of, the duties of the Subadviser or any of its directors.
5. SUPPLEMENTAL ARRANGEMENTS
The Subadviser may enter into arrangements with other persons affiliated
with the Subadviser to better enable it to fulfill its obligations under this
Agreement for the provision of certain personnel and facilities to the
Subadviser.
6. CONFLICTS OF INTEREST
It is understood that trustees, officers, agents and shareholders of the
Trust are or may be interested in the Subadviser as trustees, officers, partners
or otherwise; that employees, agents and partners of the Subadviser are or may
be interested in the Trust as trustees, officers, shareholders or otherwise;
that the Subadviser may be interested in the Trust; and that the existence of
any such dual interest shall not affect the validity hereof or of any
transactions hereunder except as otherwise provided in the Agreement and
Declaration of Trust of the Trust and the Limited Liability Company Agreement of
the Subadviser, respectively, or by specific provision of applicable law.
7. REGULATION
The Subadviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information, reports or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
8. DURATION AND TERMINATION OF AGREEMENT
This Agreement shall become effective with respect to each Portfolio on the
later of (i) its execution and (ii) the date of the meeting of the Board of
Trustees of the Trust, at which meeting this Agreement is approved as described
below. The Agreement will continue in effect for a period more than two years
from the date of its execution only so long as such continuance is specifically
approved at least annually either by the Trustees of the Trust or by a majority
of the outstanding voting securities of each of the Portfolios, provided that in
either event such continuance shall also be approved by the vote of a majority
of the Trustees of the Trust who are not interested persons (as defined in the
Investment Company Act) of any party to this Agreement cast in person at a
meeting called for the purpose of voting on such approval. Any required
shareholder approval of the Agreement or of any continuance of the Agreement
shall be effective with respect to any Portfolio if a majority of the
outstanding voting securities of the series (as defined in Rule 18f-2(h) under
the Investment Company Act) of shares of that Portfolio votes to approve the
Agreement or its continuance, notwithstanding that the Agreement or its
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continuance may not have been approved by a majority of the outstanding voting
securities of (a) any other Portfolio affected by the Agreement or (b) all the
portfolios of the Trust.
If any required shareholder approval of this Agreement or any continuance
of the Agreement is not obtained, the Subadviser will continue to act as
investment subadviser with respect to such Portfolio pending the required
approval of the Agreement or its continuance or of a new contract with the
Subadviser or a different adviser or subadviser or other definitive action;
provided, that the compensation received by the Subadviser in respect of such
Portfolio during such period is in compliance with Rule 15a-4 under the
Investment Company Act.
This Agreement may be terminated at any time, without the payment of any
penalty, by the Trustees of the Trust, by the vote of a majority of the
outstanding voting securities of the Trust, or with respect to any Portfolio by
the vote of a majority of the outstanding voting securities of such Portfolio,
on sixty days' written notice to the Adviser and the Subadviser, or by the
Adviser or Subadviser on sixty days' written notice to the Trust and the other
party. This Agreement will automatically terminate, without the payment of any
penalty, in the event of its assignment (as defined in the Investment Company
Act) or in the event the Advisory Agreement between the Adviser and the Trust
terminates for any reason.
9. PROVISION OF CERTAIN INFORMATION BY SUBADVISER
The Subadviser will promptly notify the Adviser in writing of the
occurrence of any of the following events:
a. the Subadviser fails to be registered as an investment adviser under the
Investment Advisers Act or under the laws of any jurisdiction in which the
Subadviser is required to be registered as an investment adviser in order
to perform its obligations under this Agreement;
b. the Subadviser is served or otherwise receives notice of any action, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any
court, public board or body, involving the affairs of the Trust; and
c. any change in actual control or management of the Subadviser or the
portfolio manager of any Portfolio.
10. SERVICES TO OTHER CLIENTS
The Adviser understands, and has advised the Trust's Board of Trustees,
that the Subadviser now acts, or may in the future act, as an investment adviser
to fiduciary and other managed accounts and as investment adviser or subadviser
to other investment companies. Further, the Adviser understands, and has advised
the Trust's Board of Trustees that the Subadviser and its affiliates may give
advice and take action for its accounts, including investment companies, which
differs from advice given on the timing or nature of action taken for the
Portfolio. The Subadviser is not obligated to initiate transactions for a
Portfolio in any security which the Subadviser, its partners, affiliates or
employees may purchase or sell for their own accounts or other clients.
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11. CONSULTATION WITH SUBADVISERS TO OTHER TRUST PORTFOLIOS
As required by Rule 17a-10 under the Investment Company Act of 1940, the
Subadviser is prohibited from consulting with the entities listed below
concerning transactions for a Portfolio in securities or other assets:
1. other subadvisers to a Portfolio
2. other subadvisers to a Trust portfolio
3. other subadvisers to a portfolio under common control with the Portfolio
12. AMENDMENTS TO THE AGREEMENT
This Agreement may be amended by the parties only if such amendment is
specifically approved by the vote of a majority of the Trustees of the Trust and
by the vote of a majority of the Trustees of the Trust who are not interested
persons of any party to this Agreement cast in person at a meeting called for
the purpose of voting on such approval. Any required shareholder approval shall
be effective with respect to any Portfolio if a majority of the outstanding
voting securities of that Portfolio vote to approve the amendment,
notwithstanding that the amendment may not have been approved by a majority of
the outstanding voting securities of (a) any other Portfolio affected by the
amendment or (b) all the portfolios of the Trust.
13. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties.
14. HEADINGS
The headings in the sections of this Agreement are inserted for convenience
of reference only and shall not constitute a part hereof.
15. NOTICES
All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of the Trust or
applicable party in person or by registered mail or a private mail or delivery
service providing the sender with notice of receipt. Notice shall be deemed
given on the date delivered or mailed in accordance with this paragraph.
16. SEVERABILITY
Should any portion of this Agreement for any reason be held to be void in
law or in equity, the Agreement shall be construed, insofar as is possible, as
if such portion had never been contained herein.
17. GOVERNING LAW
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of The Commonwealth of Massachusetts, or any of the
applicable provisions of the Investment Company Act. To the extent that the laws
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of The Commonwealth of Massachusetts, or any of the provisions in this
Agreement, conflict with applicable provisions of the Investment Company Act,
the latter shall control.
18. LIMITATION OF LIABILITY
The Agreement and Declaration of Trust, a copy of which, together with all
amendments thereto (the "Declaration"), is on file in the office of the
Secretary of The Commonwealth of Massachusetts, provides that the name " John
Hancock Funds II" refers to the Trustees under the Declaration collectively as
Trustees, but not as individuals or personally; and no Trustee, shareholder,
officer, employee or agent of the Trust shall be held to any personal liability,
nor shall resort be had to their private property, for the satisfaction of any
obligation or claim, in connection with the affairs of the Trust or any
portfolio thereof, but only the assets belonging to the Trust, or to the
particular Portfolio with respect to which such obligation or claim arose, shall
be liable.
19. CONFIDENTIALITY OF TRUST PORTFOLIO HOLDINGS
The Subadviser agrees to treat Trust portfolio holdings as confidential
information in accordance with the Trust's "Policy Regarding Disclosure of
Portfolio Holdings," as such policy may be amended from time to time, and to
prohibit its employees from trading on any such confidential information.
20. COMPLIANCE
Upon execution of this Agreement, the Subadviser shall provide the Adviser
with the Subadviser's written policies and procedures ("Compliance Policies") as
required by Rule 206(4)-7 under the Investment Advisers Act. Throughout the term
of this Agreement, the Subadviser shall promptly submit to the Adviser: (i) any
material changes to the Compliance Policies, (ii) notification of the
commencement of a regulatory examination of the Subadviser and documentation
describing the results of any such examination and of any periodic testing of
the Compliance Policies, and (iii) notification of any material compliance
matter that relates to the services provided by the Subadviser to the Trust
including but not limited to any material violation of the Compliance Policies
or of the Subadviser's code of ethics and/or related code. Throughout the term
of this Agreement, the Subadviser shall provide the Adviser with any
certifications, information and access to personnel and resources (including
those resources that will permit testing of the Compliance Policies by the
Adviser) that the Adviser may reasonably request to enable the Trust to comply
with Rule 38a-1 under the Investment Company Act.
(THE REMAINDER OF THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers as of the date first
mentioned above.
By: John Hancock Life Insurance Company
(U.S.A.), Managing Member
By:
------------------------------
John D. DesPrez III
Chairman
SOVEREIGN ASSET MANAGEMENT LLC
By:
------------------------------
Name:
Title:
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APPENDIX A
----------
The Subadviser shall serve as investment subadviser for each Portfolio of
the Trust listed below. The Adviser will pay the Subadviser, as full
compensation for all services provided under this Agreement with respect to each
Portfolio, the fee computed separately for such Portfolio at an annual rate as
follows (the "Subadviser Fee"):
PORTFOLIO AGGREGATE NET ASSETS*
--------- --------------------
Emerging Growth Fund 0.350%
*The term Aggregate Net Assets includes the net assets of a Portfolio of the
Trust. For purposes of determining Aggregate Net Assets and calculating the
Subadviser Fee, the net assets of the Portfolio are determined as of the close
of business on the previous business day of the Trust.
The Subadviser Fee for a Portfolio shall be based on the applicable annual
fee rate for the Portfolio which for each day shall be equal to (i) the sum of
the amounts determined by applying the annual percentage rates in the table to
the applicable portions of Aggregate Net Assets divided by (ii) Aggregate Net
Assets (the "Applicable Annual Fee Rate"). The Subadviser Fee for the Portfolio
shall be accrued for each calendar day, and the sum of the daily fee accruals
shall be paid monthly to the Subadviser within 30 calendar days of the end of
each month. The daily fee accruals will be computed by multiplying the fraction
of one over the number of calendar days in the year by the Applicable Annual Fee
Rate, and multiplying this product by the net assets of the Portfolio. The
Adviser shall provide Subadviser with such information as Subadviser may
reasonably request supporting the calculation of the fees paid to it hereunder.
Fees shall be paid either by wire transfer or check, as directed by Subadviser.
If, with respect to any Portfolio, this Agreement becomes effective or
terminates, or if the manner of determining the Applicable Annual Fee Rate
changes, before the end of any month, the fee (if any) for the period from the
effective date to the end of such month or from the beginning of such month to
the date of termination or from the beginning of such month to the date such
change, as the case may be, shall be prorated according to the proportion which
such period bears to the full month in which such effectiveness or termination
or change occurs.
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APPENDIX C
ADDITIONAL INFORMATION
ABOUT SOVEREIGN AND THE NEW SUBADVISORY AGREEMENT
As described under Proposal 1, Sovereign succeeded John Hancock Advisers,
LLC as the subadviser to the Active Bond Fund and Strategic Income Fund
effective December 31, 2005 and is proposed to replace MFC Global as subadviser
for the Emerging Growth Fund effective April 28, 2006. This Appendix supplements
the information contained in the Proxy Statement about Sovereign.
MANAGEMENT AND CONTROL OF SOVEREIGN
Sovereign, a Delaware limited liability company located at 101 Huntington
Avenue, Boston, Massachusetts, was founded in 1979 and is a wholly owned
subsidiary of John Hancock Financial Services, Inc. ("JHFS"), located at: 601
Congress Street, Boston, Massachusetts 02210. JHFS is a subsidiary of Manulife
Financial Corporation ("MFC") based in Toronto, Canada, located at: 200 Bloor
Street East, Toronto, Ontario M4W 1E5. MFC is the holding company of The
Manufacturers Life Insurance Company and its subsidiaries, collectively known as
Manulife Financial.
The names and principal occupations of Sovereign's principal executive
officers and directors are set forth below. The business address of each such
person, unless otherwise stated, is: 101 Huntington Avenue, Boston, MA 02199.
- -------------------------------------------------------------------------------
NAME PRINCIPAL OCCUPATION
[POSITION WITH THE TRUST] POSITION AT SOVEREIGN
- -------------------------------------------------------------------------------
John D. DesPrez III Director and Chairman Senior Executive Vice
President, Manulife
Financial Corporation;
Director (since 2004)
and Chairman, Sovereign
Asset Management LLC,
John Hancock Funds,
LLC, the Berkeley
Financial Group, LLC
and John Hancock
Advisers, LLC (since
2005).
- -------------------------------------------------------------------------------
Keith F. Hartstein Director, President Senior Vice President,
[President] and CEO Manulife Financial
Corporation (since
2004); Director,
President and Chief
Executive Officer,
Sovereign Asset
Management LLC and The
Berkeley Group (holding
company); Director,
President and Chief
Executive Officer, John
Hancock Funds;
Director, President and
Chief Executive
Officer, Sovereign
Asset Management LLC;
Director, John Hancock
Signature Services,
Inc.; Director,
Chairman and President,
NM Capital Management,
Inc. (NM Capital);
Chairman, Investment
Company Institute Sales
Force Marketing
Committee (since 2003).
- -------------------------------------------------------------------------------
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- -------------------------------------------------------------------------------
Marc Costantini Director Director, Sovereign
Asset Management LLC
(since 2004); Senior
Vice President, U.S.
Wealth Management, John
Hancock Financial
Services, Inc. (since
2004).
- -------------------------------------------------------------------------------
Barry H. Evans Director, Senior Vice Senior Vice President,
President and Chief Chief Fixed Income
Operating Officer Officer, John Hancock
Advisers, LLC (since
1986); Chief Operating
Officer, John Hancock
Advisers, LLC (since
2005); Director, Senior
Vice President and
Chief Operating
Officer, Sovereign
Asset Management LLC
(since 2005)
- -------------------------------------------------------------------------------
Leo J. de Bever Director Director, Sovereign
Asset Management LLC
(since 2005); Executive
Vice President, MFC
Global Investment
Management (since
2004); Director,
Elliott & Page Limited
(since 2004).
- -------------------------------------------------------------------------------
PORTFOLIO MANAGERS
The portfolio managers at Sovereign that would be responsible for the
day-to-day management of the Emerging Growth Fund are:
o Henry E. Mehlman, CFA. Mr. Mehlman joined Sovereign in 2006. Prior to
joining Sovereign he was employed by an affiliate of Sovereign, John Hancock
Advisers, LLC. Mr. Mehlman received a B.A. and J.D. from the University of
Florida.
o Alan E. Norton, CFA. Mr. Norton joined Sovereign in 2006. Prior to joining
Sovereign, he was employed by an affiliate of Sovereign, John Hancock Advisers,
LLC. Mr. Norton received a B.A. from Trinity College and an M.B.A. from Babson
College.
OTHER ACCOUNTS MANAGED
Sovereign currently acts as adviser or subadviser to the following
registered investment companies or series thereof having similar investment
objectives and policies to those of the Emerging Growth Fund. The table below
also states the size of each such fund as of December 31, 2005 and the current
advisory fee rate for each fund as a percentage of average daily net assets (or
otherwise as indicated below).
ASSETS
NAME OF FUND AS OF 12/31/05 ADVISORY FEE RATE
- ------------ -------------- -----------------
John Hancock Small Cap Equity $437,456,871 .700% to $1 Billion
Fund .685% over $1 Billion
[Sovereign Asset Management does not generally receive a fee based upon the
investment performance of the account reflected in the table above.]
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PAYMENTS TO AFFILIATES
[INFORMATION TO BE ADDED/UPDATED]
3
JOHN HANCOCK FUNDS II
PROXY CARD
Voting pursuant to this proxy card will be as specified. If no
specification is made as to an item, voting will be "FOR" such item. A proxy
card is provided for the shares of the Emerging Growth Fund held by you as of
February 24, 2006. Please sign, date, and return the proxy card in the enclosed
postage-paid envelope.
PROXY CARDS MUST BE RECEIVED BY APRIL 24, 2006 TO BE VOTED AT THE MEETING
TO BE HELD ON APRIL 25, 2006.
EMERGING GROWTH FUND
THIS PROXY CARD IS SOLICITED BY THE BOARD OF TRUSTEES OF JOHN HANCOCK FUNDS
II.
The undersigned hereby appoints Bruce Speca, Gordon Shone, Greg D'Angelo,
Betsy Anne Seel, and George Boyd and each of them, with full power of
substitution, as proxies to vote all shares of the Emerging Growth Fund of John
Hancock Funds II (the "Trust") that the undersigned is entitled in any capacity
to vote at the Special Meeting of Shareholders to be held at 601 Congress
Street, Boston, Massachusetts 02210, at 10:00 a.m., Eastern Time, April 25,
2006, and any adjournments thereof, as indicated below and in their discretion
upon such other matters as may properly come before the Meeting.
Date:________________, 2006
PLEASE SIGN IN BOX BELOW:
If shares are held jointly, each owner should sign. If only one signs, his
or her signature will be binding. If the shareholder is a corporation, the
President or a Vice President should sign in his or her own name, indicating
title. If the shareholder is a partnership, a partner should sign his or her own
name, indicating that he or she is a "Partner." If the shareholder is a trust,
the trustee should sign in his or her own name, indicating that he or she is a
"Trustee."
------------------------------------
Signature(s), Title(s), if applicable
-------------------------------------
Signature(s), Title(s), if applicable
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INDICATE YOUR VOTE BELOW BY FILLING IN THE APPROPRIATE BOX IN
THIS MANNER [X] USING BLUE OR BLACK INK OR DARK PENCIL.
PLEASE DO NOT USE RED INK.
--------------
This proxy card, if properly executed, will be voted in the manner directed
by the shareholder. IF NO DIRECTION IS MADE, THIS PROXY CARD WILL BE VOTED "FOR"
ALL PROPOSALS. Please refer to the Proxy Statement for a discussion of the
proposal.
FOR AGAINST ABSTAIN
1. Approval of a new subadvisory
agreement between John Hancock Investment [ ] [ ] [ ]
Management Services, LLC and Sovereign
Asset Management LLC for the Emerging
Growth Fund.
Any other business that may properly come
before the Meeting.
PLEASE MARK YOUR PROXY CARD, DATE AND SIGN IT ON THE REVERSE SIDE, AND
RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE IF
MAILED IN THE UNITED STATES.
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