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:

/ / Preliminary Proxy Statement

/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e) (2))

/ X / Definitive Proxy Statement

/ / Definitive Additional Materials

/ / Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12

PUTNAM HIGH INCOME OPPORTUNITIES TRUST
PUTNAM MANAGED HIGH YIELD TRUST
PUTNAM MASTER INCOME TRUST
PUTNAM TAX-FREE HEALTH CARE FUND

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement,
if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

/ X / No fee required

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(1) Title of each class of securities to which transaction applies:

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statement number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(4) Date Filed:

The proxy statement

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Putnam High Income Opportunities Trust

Putnam Managed High Yield Trust

Putnam Master Income Trust

Putnam Tax-Free Health Care Fund
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This proxy statement can help you decide how you want to vote on an
important issue relating to your Putnam fund. When you complete and sign
your proxy ballot, the Trustees of the funds will vote on your behalf
exactly as you have indicated. If you simply sign the proxy ballot, it
will be voted in accordance with the Trustees' recommendation on page 4
of the proxy statement. The Trustees recommend that shareholders vote in
favor of the proposal described in this document and listed on your
proxy ballot.

Please take a few moments and decide how you want to vote. When
shareholders don't return their proxies in sufficient numbers, follow-up
solicitations are required, which cost your fund money.

You can vote by returning your proxy ballot in the envelope provided. Or
you can call our toll-free number, or go to the Web. See your proxy
ballot for the phone number and Web address. If you have any questions,
please contact Putnam at 1-800-225-1581 or call your financial advisor.

PUTNAM INVESTMENTS

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Table of contents

A Message from the Chairman........................... 1

Notice of Shareholder Meeting......................... 3

Trustees' Recommendation.............................. 4

PROXY CARD ENCLOSED

If you have any questions, please contact us
at 1-800-225-1581 or call your financial advisor.

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A Message from the Chairman

Dear Fellow Shareholder:

I am writing to you to ask for your vote on an important matter that
affects your investment in the Putnam funds. While you are, of course,
welcome to join us at your fund's meeting, most shareholders cast their
vote by filling out and signing the enclosed proxy card(s), by calling
or by voting via the Internet. We are asking for your vote on the
following matter:

* Fixing the number of Trustees at 14 and electing your fund's nominees
for Trustees

As you may know, the SEC recently adopted rules designed to enhance the
independence and effectiveness of mutual fund trustees. Although
trustees do not manage fund portfolios, they play an important role in
protecting fund shareholders, and are responsible for approving the fees
paid to the fund's investment adviser and its affiliates, reviewing
overall fund expenses, selecting the fund's auditors, monitoring
conflicts of interests, overseeing the fund's compliance with federal
securities laws and voting proxies relating to the fund's portfolio
securities.

Your fund's Trustees believe that these responsibilities are best
carried out by a board that is independent of the fund's investment
adviser both in fact and in spirit. The new SEC rules effectively
require most funds to have a board of trustees whose independent
trustees (i.e., trustees who are not "interested persons" of the fund or
its investment adviser) constitute at least 75% of the board and whose
chairman is independent. Your fund has met both of these requirements
since July 1, 2000. We strongly supported these rules when initially
proposed by the SEC and are pleased that other fund families will soon
also be held to these standards.

It is also noteworthy that your fund's Trustees have been strong
proponents of other reforms in the mutual fund industry. We supported
new SEC rules requiring funds to make their proxy voting records
available to shareholders, and the Putnam funds were one of the first
major fund families to begin disclosing their proxy voting guidelines.
We also were one of the first mutual fund boards to end the practice of
using fund brokerage commissions to reward brokers for selling fund
shares.

In the proxy statement, you will also notice that your fund's
independent Trustees have nominated three new individuals to serve as
Trustees of your fund. Two of the three new nominees are independent,
and all three have had outstanding careers as leaders in the investment
management industry.

Although we would like very much to have each shareholder attend this
meeting, we realize that it may not be possible. Whether or not you plan
to be present, we need your vote. We urge you to record your voting
instructions by telephone, via the Internet or by completing, signing
and returning the enclosed proxy card(s) promptly. A postage-paid
envelope is enclosed for mailing, and Internet voting instructions are
listed at the top of your proxy card(s).

I'm sure that you, like most people, lead a busy life and are tempted to
put this proxy aside for another day. Please don't. When shareholders do
not vote their proxies, their fund may have to incur the expense of
follow-up solicitations. All shareholders benefit from the speedy return
of proxies.

Your vote is important to us. We appreciate the time and consideration I
am sure you will give this important matter. If you have questions about
this proposal, please call a Putnam customer service representative at
1-800-225-1581 or contact your financial advisor.

Sincerely yours,

/S/ JOHN A. HILL
John A. HIll, Chairman

PUTNAM HIGH INCOME OPPORTUNITIES TRUST
PUTNAM MANAGED HIGH YIELD TRUST
PUTNAM MASTER INCOME TRUST
PUTNAM TAX-FREE HEALTH CARE FUND

Notice of Annual Meeting of Shareholders

* This is the formal agenda for your fund's shareholder meeting. It
tells you what proposals will be voted on and the time and place of the
meeting, in the event you attend in person.

To the Shareholders of Putnam High Income Opportunities Trust, Putnam
Managed High Yield Trust, Putnam Master Income Trust and Putnam Tax-Free
Health Care Fund:

The Annual Meeting of Shareholders of your fund will be held on October
14, 2004 at 11:00 a.m., Boston time, at the principal offices of the
funds on the eighth floor of One Post Office Square, Boston,
Massachusetts 02109, to consider the following:

1. Fixing the number of Trustees at 14 and electing your fund's
nominees for Trustees. See page 4.

By the Trustees

John A. Hill, Chairman
George Putnam, III, President

Jameson A. Baxter
Charles B. Curtis
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
John H. Mullin, III
Robert E. Patterson
A.J.C. Smith
W. Thomas Stephens

We urge you to mark, sign, date and mail the enclosed proxy in the
postage-paid envelope provided or record your voting instructions via
telephone or via the Internet so that you will be represented at the
meeting.

August 9, 2004

Proxy Statement

This document will give you the information you need to vote on the
proposal. Much of the information is required under rules of the
Securities and Exchange Commission ("SEC"); some of it is technical. If
there is anything you don't understand, please contact us at our
toll-free number, 1-800-225-1581, or call your financial advisor.

* Who is asking for your vote?

The enclosed proxy is solicited by the Trustees of Putnam High Income
Opportunities Trust, Putnam Managed High Yield Trust, Putnam Master
Income Trust and Putnam Tax-Free Health Care Fund for use at the Annual
Meeting of Shareholders of each fund to be held on October 14, 2004,
and, if your fund's meeting is adjourned, at any later meetings, for the
purpose stated in the Notice of Annual Meeting (see previous page). The
Notice of Annual Meeting, the proxy and the proxy statement are being
mailed on or about August 9, 2004.

* How do your fund's Trustees recommend that shareholders vote on this
proposal?

The Trustees recommend that you vote

1. For fixing the number of Trustees at 14 and electing your fund's
nominees for Trustees

* Who is eligible to vote?

Shareholders of record of each fund at the close of business on July 20,
2004 are entitled to be present and to vote at the meeting or any
adjourned meeting.

Each share is entitled to one vote. Shares represented by your duly
executed proxy will be voted in accordance with your instructions. If
you sign the proxy, but don't fill in a vote, your shares will be voted
in accordance with the Trustees' recommendations. If any other business
is brought before your fund's meeting, your shares will be voted at the
Trustees' discretion.

Shareholders of each fund vote separately with respect to the election
of Trustees. The outcome of a vote affecting one fund does not affect
any other fund.

The Proposals

I. Election of Trustees

* Who are the nominees for Trustees?

The Board Policy and Nominating Committee of the Trustees of each fund
makes recommendations concerning the nominees for Trustees of that fund.
The Board Policy and Nominating Committee consists solely of Trustees
who are not "interested persons" (as defined in the Investment Company
Act of 1940, as amended (the "1940 Act")) of your fund or of Putnam
Investment Management, LLC, your fund's investment manager ("Putnam
Management"). Those Trustees who are not "interested persons" of your
fund or Putnam Management are referred to as "Independent Trustees"
throughout this proxy statement.

The Board Policy and Nominating Committee of each fund recommends that
the number of Trustees of each fund be fixed at 14 and that you vote for
the election of the nominees described in the following pages.

The nominees for Trustees and their backgrounds are shown in the
following pages. This information includes each nominee's name, date of
birth, principal occupation(s) during the past five years and other
information about the nominee's professional background, including other
directorships the nominee holds. Each Trustee oversees all of the Putnam
funds and serves until the election and qualification of his or her
successor, or until he or she sooner dies, resigns or is removed. Each
nominee other than Ms. Drucker and Messrs. Haldeman and Worley currently
serves as a Trustee of your fund. The address of all of the Trustees and
nominees is One Post Office Square, Boston, Massachusetts 02109. At
December 31, 2003, there were 101 Putnam funds.

Jameson A. Baxter (9/6/43)
Trustee since 1994

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Ms. Baxter is the President of Baxter Associates, Inc., a private
investment firm that she founded in 1986.

Ms. Baxter serves as a Director of ASHTA Chemicals, Inc., Banta
Corporation (a printing and digital imaging firm), Ryerson Tull, Inc. (a
steel service corporation), Advocate Health Care and BoardSource,
formerly the National Center for Nonprofit Boards. She is Chairman
Emeritus of the Board of Trustees, Mount Holyoke College, having served
as Chairman for five years and as a board member for thirteen years.
Until 2002, Ms. Baxter was a Director of Intermatic Corporation (a
manufacturer of energy control products).

Ms. Baxter has held various positions in investment banking and
corporate finance, including Vice President and Principal of the Regency
Group, and Vice President of and Consultant to First Boston Corporation.
She is a graduate of Mount Holyoke College.

Charles B. Curtis (4/27/40)
Trustee since 2001

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Mr. Curtis is President and Chief Operating Officer of the Nuclear
Threat Initiative (a private foundation dealing with national security
issues) and serves as Senior Advisor to the United Nations Foundation.

Mr. Curtis is a member of the Council on Foreign Relations and the
Trustee Advisory Council of the Applied Physics Laboratory, Johns
Hopkins University. Until 2003, Mr. Curtis was a member of the Electric
Power Research Institute Advisory Council and the University of Chicago
Board of Governors for Argonne National Laboratory. Prior to 2002, Mr.
Curtis was a Member of the Board of Directors of the Gas Technology
Institute and the Board of Directors of the Environment and Natural
Resources Program Steering Committee, John F. Kennedy School of
Government, Harvard University. Until 2001, Mr. Curtis was a member of
the Department of Defense Policy Board and Director of EG&G Technical
Services, Inc. (a fossil energy research and development support
company).

From August 1997 to December 1999, Mr. Curtis was a Partner at Hogan &
Hartson L.L.P., a Washington, D.C. law firm. Prior to May 1997, Mr.
Curtis was Deputy Secretary of Energy. He served as Chairman of the
Federal Energy Regulatory Commission from 1977 to 1981 and has held
positions on the staff of the U.S. House of Representatives, the U.S.
Treasury Department and the SEC.

Myra R. Drucker (1/16/48)

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Ms. Drucker is a Vice Chair of the Board of Trustees of Sarah Lawrence
College, a Trustee of Commonfund (a not-for-profit firm specializing in
asset management for educational endowments and foundations) and a
member of the Investment Committee of the Kresge Foundation (a
charitable trust). She is also Chair of the New York Stock Exchange
(NYSE) Pension Managers Advisory Committee and a member of the Executive
Committee of the Committee on Investment of Employee Benefit Assets.
Until August 31, 2004, Ms. Drucker is Managing Director and a member of
the Board of Directors of General Motors Asset Management and Chief
Investment Officer of General Motors Trust Bank. Ms. Drucker also served
as a member of the NYSE Corporate Accountability and Listing Standards
Committee and the NYSE/NASD IPO Advisory Committee.

Prior to joining General Motors Asset Management in 2001, Ms. Drucker held
various executive positions in the investment management industry. Ms.
Drucker served as Chief Investment Officer of Xerox Corporation (a
technology and service company in the document industry), where she was
responsible for the investment of the company's pension assets. Ms. Drucker
was also Staff Vice President and Director of Trust Investments for
International Paper (a paper, paper distribution, packaging and forest
products company) and previously served as Manager of Trust Investments for
Xerox Corporation. Ms. Drucker received a B.A. degree in Literature and
Psychology from Sarah Lawrence College and pursued graduate studies in
economics, statistics and portfolio theory at Temple University.

John A. Hill (1/31/42)
Trustee since 1985 and Chairman since 2000

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Mr. Hill is Vice Chairman of First Reserve Corporation, a private equity
buyout firm that specializes in energy investments in the diversified
worldwide energy industry.

Mr. Hill is a Director of Devon Energy Corporation, TransMontaigne Oil
Company, Continuum Health Partners of New York and various private companies
controlled by First Reserve Corporation, as well as a Trustee of TH Lee,
Putnam Investment Trust (a closed-end investment company advised by an
affiliate of Putnam Management). He is also a Trustee of Sarah Lawrence
College.

Prior to acquiring First Reserve Corporation in 1983, Mr. Hill held
executive positions in investment banking and investment management with
several firms and with the federal government, including Deputy
Associate Director of the Office of Management and Budget and Deputy
Director of the Federal Energy Administration. He is active in various
business associations, including the Economic Club of New York and
lectures on energy issues in the United States and Europe. Mr. Hill
holds a B.A. degree in Economics from Southern Methodist University and
pursued graduate studies there as a Woodrow Wilson Fellow.

Ronald J. Jackson (12/17/43)
Trustee since 1996

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Mr. Jackson is a private investor.

Mr. Jackson is President of the Kathleen and Ronald J. Jackson
Foundation (a charitable trust). He is also a member of the Board of
Overseers of WGBH (a public television and radio station) as well as a
member of the Board of Overseers of the Peabody Essex Museum.

Mr. Jackson is the former Chairman, President and Chief Executive
Officer of Fisher-Price, Inc. (a major toy manufacturer), from which he
retired in 1993. He previously served as President and Chief Executive
Officer of Stride-Rite, Inc. (a manufacturer and distributor of
footwear) and of Kenner Parker Toys, Inc. (a major toy and game
manufacturer). Mr. Jackson was President of Talbots, Inc. (a distributor
of women's apparel) and has held financial and marketing positions with
General Mills, Inc. and Parker Brothers (a toy and game company). Mr.
Jackson is a graduate of the University of Michigan Business School.

Paul L. Joskow (6/30/47)
Trustee since 1997

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Dr. Joskow is the Elizabeth and James Killian Professor of Economics and
Management, and Director of the Center for Energy and Environmental
Policy Research at the Massachusetts Institute of Technology.

Dr. Joskow serves as a Director of National Grid Transco (a UK-based
holding company with interests in electric and gas transmission and
distribution and telecommunications infrastructure) and TransCanada
Corporation (an energy company focused on natural gas transmission and
power services). He also serves on the board of the Whitehead Institute
for Biomedical Research (a non-profit research institution) and has been
President of the Yale University Council since 1993. Prior to February
2002, he was a Director of State Farm Indemnity Company (an automobile
insurance company), and, prior to March 2000, he was a Director of New
England Electric System (a public utility holding company).

Dr. Joskow has published five books and numerous articles on topics in
industrial organization, government regulation of industry and competition
policy. He is active in industry restructuring, environmental, energy,
competition and privatization policies -- serving as an advisor to
governments and corporations worldwide. Dr. Joskow holds a Ph.D. and M. Phil
from Yale University and B.A. from Cornell University.

Elizabeth T. Kennan (2/25/38)
Trustee since 1992

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Dr. Kennan is a Partner of Cambus-Kenneth Farm (thoroughbred horse and
cattle breeding). She is President Emeritus of Mount Holyoke College.

Dr. Kennan served as Chairman and is now Lead Director of Northeast
Utilities and is a Director of Talbots, Inc. She has served as Director
on a number of other boards, including Bell Atlantic, Chastain Real
Estate, Shawmut Bank, Berkshire Life Insurance and Kentucky Home Life
Insurance. She is a Trustee of the National Trust for Historic
Preservation, of Centre College and of Midway College in Midway,
Kentucky. She is also a member of The Trustees of Reservations. Dr.
Kennan has served on the oversight committee of the Folger Shakespeare
Library, as President of Five Colleges Incorporated, as a Trustee of
Notre Dame University and is active in various educational and civic
associations.

As a member of the faculty of Catholic University for twelve years,
until 1978, Dr. Kennan directed the post-doctoral program in Patristic
and Medieval Studies, taught history and published numerous articles.
Dr. Kennan holds a Ph.D. from the University of Washington in Seattle,
an M.S. from St. Hilda's College at Oxford University and an A.B. from
Mount Holyoke College. She holds several honorary doctorates.

John H. Mullin, III (6/15/41)
Trustee since 1997

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Mr. Mullin is the Chairman and CEO of Ridgeway Farm (a limited liability
company engaged in timber and farming).

Mr. Mullin serves as a Director of The Liberty Corporation (a
broadcasting company), Progress Energy, Inc. (a utility company,
formerly known as Carolina Power & Light) and Sonoco Products, Inc. (a
packaging company). Mr. Mullin is Trustee Emeritus of The National
Humanities Center and Washington & Lee University, where he served as
Chairman of the Investment Committee. Prior to May 2001, he was a
Director of Graphic Packaging International Corp. Prior to February
2004, he was a Director of Alex Brown Realty, Inc.

Mr. Mullin is also a past Director of Adolph Coors Company; ACX
Technologies, Inc.; Crystal Brands, Inc.; Dillon, Read & Co., Inc.;
Fisher-Price, Inc.; and The Ryland Group, Inc. Mr. Mullin is a graduate
of Washington & Lee University and The Wharton Graduate School,
University of Pennsylvania.

Robert E. Patterson (3/15/45)
Trustee since 1984

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Mr. Patterson is Senior Partner of Cabot Properties, L.P. and Chairman
of Cabot Properties, Inc. (a private equity firm specializing in real
estate).

Mr. Patterson serves as Chairman of the Joslin Diabetes Center and as a
Director of Brandywine Trust Company, LLC. Prior to June 2003, he was a
Trustee of Sea Education Association. Prior to December 2001, he was
President and Trustee of Cabot Industrial Trust (a publicly traded real
estate investment trust), prior to February 1998, he was Executive Vice
President and Director of Acquisitions of Cabot Partners Limited Partnership
(a registered investment adviser involved in institutional real estate
investments) and, prior to 1990, he served as Executive Vice President of
Cabot, Cabot & Forbes Realty Advisors, Inc. (the predecessor company of
Cabot Partners) and as a Senior Vice President of the Beal Companies (a real
estate management, investment and
development firm).

Mr. Patterson practiced law and held various positions in state
government and was the founding Executive Director of the Massachusetts
Industrial Finance Agency. Mr. Patterson is a graduate of Harvard
College and Harvard Law School.

W. Thomas Stephens (9/2/42)
Trustee since 1997

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Mr. Stephens serves on a number of corporate boards.

Effective November 2004, Mr. Stephens is expected to become Chief
Executive Officer of Boise Cascade, L.L.C. (a paper, forest products and
timberland assets company). Mr. Stephens serves as a Director of Xcel
Energy Incorporated (a public utility company) and TransCanada Pipelines
Limited. Until 2004, Mr. Stephens was a Director of Qwest Communications
and Norske Canada, Inc. (a paper manufacturer). Until 2003, Mr. Stephens
was a Director of Mail-Well, Inc. (a diversified printing company). He
served as Chairman of Mail-Well until 2001 and as CEO of
MacMillan-Bloedel, Ltd. (a forest products company) until 1999.

Prior to 1996, Mr. Stephens was Chairman and Chief Executive Officer of
Johns Manville Corporation. He holds B.S. and M.S. degrees from the
University of Arkansas.

Richard B. Worley (11/15/45)

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Mr. Worley is Managing Partner of Permit Capital LLC, an investment
management firm.

Mr. Worley serves on the Executive Committee of the University of
Pennsylvania Medical Center, is a Trustee of The Robert Wood Johnson
Foundation (a philanthropic organization devoted to health care issues)
and is a Director of The Colonial Williamsburg Foundation (a historical
preservation organization). Mr. Worley also serves on the investment
committees of Mount Holyoke College and World Wildlife Fund (a wildlife
conservation organization).

Prior to joining Permit Capital LLC in 2002, Mr. Worley served as Chief
Strategic Officer of Morgan Stanley Investment Management. He previously
served as President, Chief Executive Officer and Chief Investment
Officer of Morgan Stanley Dean Witter Investment Management and as a
Managing Director of Morgan Stanley, a financial services firm. Mr.
Worley also was the Chairman of Miller Anderson & Sherrerd, an
investment management firm. Mr. Worley holds a B.S. degree from
University of Tennessee and pursued graduate studies in economics at the
University of Texas.

* Interested Trustees

Charles E. Haldeman, Jr.* (10/29/48)

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Mr. Haldeman is President and Chief Executive Officer of Putnam, LLC
("Putnam Investments"). He is a member of Putnam Investments' Executive
Board of Directors and Advisory Council. Prior to November 2003, Mr.
Haldeman served as Co-Head of Putnam Investments' Investment Division.

Prior to joining Putnam Investments in 2002, Mr. Haldeman held
executive positions in the investment management industry. Mr. Haldeman
previously served as Chief Executive Officer of Delaware Investments and
President & Chief Operating Officer of United Asset Management. Mr.
Haldeman was also a partner and director of Cooke & Bieler, Inc. (an
investment management firm). Mr. Haldeman currently serves as a Trustee
of Dartmouth College and as Emeritus Trustee of Abington Memorial
Hospital. Mr. Haldeman is a graduate of Dartmouth College, Harvard Law
School and Harvard Business School. Mr. Haldeman is also a Chartered
Financial Analyst (CFA) charterholder.

George Putnam III* (8/10/51)
Trustee since 1984 and President since 2000

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Mr. Putnam is President of New Generation Research, Inc. (a publisher of
financial advisory and other research services) and of New Generation
Advisers, Inc. (a registered investment adviser to private funds). Mr.
Putnam founded the New Generation companies in 1986.

Mr. Putnam is a Director of The Boston Family Office, LLC (a registered
investment adviser). He is a Trustee of St. Mark's School, Shore Country
Day School, and until 2002 was a Trustee of the Sea Education
Association.

Mr. Putnam previously worked as an attorney with the law firm of Dechert
LLP (formerly known as Dechert Price & Rhoads) in Philadelphia. He is a
graduate of Harvard College, Harvard Business School and Harvard Law
School.

A.J.C. Smith* (4/13/34)
Trustee since 1986

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Mr. Smith is the Chairman of Putnam Investments and Director of and
Consultant to Marsh & McLennan Companies, Inc.

Mr. Smith is also a Director of Trident Corp. (a limited partnership
with over thirty institutional investors). He is also a Trustee of the
Carnegie Hall Society, the Educational Broadcasting Corporation and the
National Museums of Scotland. He is Chairman of the Central Park
Conservancy and a Member of the Board of Overseers of the Joan and
Sanford I. Weill Graduate School of Medical Sciences of Cornell
University. Prior to May 2000 and November 1999, Mr. Smith was Chairman
and CEO, respectively, of Marsh & McLennan Companies, Inc.

* Nominees who are or may be deemed to be "interested persons" (as
defined in the 1940 Act) of the fund, Putnam Management, Putnam Retail
Management Limited Partnership ("Putnam Retail Management") or Marsh &
McLennan Companies, Inc., the parent company of Putnam Investments and
its affiliated companies. Messrs. Haldeman, Putnam and Smith are deemed
"interested persons" by virtue of their positions as officers of the
funds, Putnam Management, Putnam Retail Management or Marsh & McLennan
Companies, Inc. and as shareholders of Marsh & McLennan Companies, Inc.
Mr. Putnam, III is the President of your fund and each of the other
Putnam funds. Mr. Haldeman is the President and Chief Executive Officer
of Putnam Investments and Putnam Management. Mr. Smith is the Chairman
of Putnam Investments and serves as a Director and Consultant to Marsh &
McLennan Companies, Inc. The balance of the nominees are not "interested
persons."

Ms. Drucker and Mr. Haldeman were each recommended for consideration as
a nominee for Trustee of your fund by an Independent Trustee. Mr. Worley
was recommended for consideration as a nominee for Trustee of your fund
by a third-party search firm that was engaged by the Trustees. The
third-party search firm assisted the Trustees in identifying and
evaluating potential nominees.

Except for Ms. Drucker and Messrs. Haldeman and Worley, all the nominees
were elected by the shareholders of Putnam Managed High Yield Trust,
Putnam Master Income Trust and Putnam Tax-Free Heath Care Fund on
October 7, 2003. The following table indicates the dates on which the
nominees (other than Ms. Drucker and Messrs. Haldeman and Worley) were
elected by the shareholders of Putnam High Income Opportunities Trust:

Nominee Date last elected
- -----------------------------------------------------
Jameson A. Baxter August 15, 2002
- -----------------------------------------------------
Charles B. Curtis August 15, 2002
- -----------------------------------------------------
John A. Hill October 7, 2003
- -----------------------------------------------------
Ronald J. Jackson October 7, 2003
- -----------------------------------------------------
Paul L. Joskow August 15, 2002
- -----------------------------------------------------
Elizabeth T. Kennan October 7, 2003
- -----------------------------------------------------
John H. Mullin, III October 11, 2001
- -----------------------------------------------------
Robert E. Patterson October 7, 2003
- -----------------------------------------------------
George Putnam, III October 7, 2003
- -----------------------------------------------------
A.J.C. Smith October 11, 2001
- -----------------------------------------------------
W. Thomas Stephens October 11, 2001
- -----------------------------------------------------

The 14 nominees for Trustees will be elected as Trustees of your fund.
The current Trustees serve until their successors are elected and
qualified. Each of the nominees has agreed to serve as a Trustee if
elected. If any of the nominees is unavailable for election at the time
of the meeting, which is not anticipated, the Trustees may vote for
other nominees at their discretion, or the Trustees may fix the number
of Trustees at fewer than 14 for your fund.

* What are the Trustees' responsibilities?

Your fund's Trustees are responsible for the general oversight of your
fund's affairs and for assuring that your fund is managed in the best
interests of its shareholders. The Trustees regularly review your fund's
investment performance as well as the quality of other services provided to
your fund and its shareholders by Putnam Management and its affiliates,
including administration, custody and shareholder servicing. At least
annually, the Trustees review and evaluate the fees and operating expenses
paid by your fund for these services and negotiate changes that they deem
appropriate. In carrying out these responsibilities, the Trustees are
assisted by an independent administrative staff and by your fund's
independent auditors, independent counsel and other experts as appropriate,
selected by and responsible to the Trustees.

The 1940 Act and the rules and regulations promulgated thereunder
requires that your fund have a minimum proportion of trustees who are
not "interested persons" (as defined in the 1940 Act) of your fund or
your fund's investment manager. These independent trustees must vote
separately to approve all financial arrangements and other agreements
with your fund's investment manager and other affiliated parties. The
role of independent trustees has been characterized as that of a
"watchdog" charged with oversight to protect shareholders' interests
against overreaching and abuse by those who are in a position to control
or influence a fund. Your fund's Independent Trustees meet regularly as
a group in executive session. Eleven of the 14 nominees for election as
Trustee would be Independent Trustees.

Board committees. Your fund's Trustees have determined that the
efficient conduct of your fund's affairs makes it desirable to delegate
responsibility for certain specific matters to committees of the board.
Certain committees (the Executive Committee, Distributions Committee and
Audit and Pricing Committee) are authorized to act for the Trustees as
specified in their charters. The other committees review and evaluate
matters specified in their charters and make recommendations to the
Trustees as they deem appropriate. Each committee may utilize the
resources of your fund's independent staff, counsel and auditors as well
as other experts. The committees meet as often as necessary, either in
conjunction with regular meetings of the Trustees or otherwise. The
membership and chairperson of each committee are appointed by the
Trustees upon recommendation of the Board Policy and Nominating
Committee.

Audit and Pricing Committee. The Audit and Pricing Committee provides
oversight on matters relating to the preparation of the funds' financial
statements, compliance matters and Code of Ethics issues. This oversight is
discharged by regularly meeting with management and the funds' independent
auditors and keeping current on industry developments. Duties of this
Committee also include the review and evaluation of all matters and
relationships pertaining to the funds' independent auditors, including their
independence. The members of the Audit and Pricing Committee of your fund
include only Independent Trustees. The Committee also reviews the funds'
policies and procedures for achieving accurate and timely pricing of the
funds' shares, including oversight of fair value determinations of
individual securities made by Putnam Management or other designated agents
of the funds. The Committee oversees compliance by money market funds with
Rule 2a-7, interfund transactions pursuant to Rule 17a-7 and the correction
of occasional pricing errors. The Committee also receives reports regarding
the liquidity of portfolio securities. The Trustees have adopted a written
charter for the Audit and Pricing Committee, a copy of which is attached to
this proxy statement as Exhibit A. The Committee currently consists of Drs.
Joskow (Chairperson) and Kennan and Messrs. Patterson and Stephens.

Board Policy and Nominating Committee. The Board Policy and Nominating
Committee reviews policy matters pertaining to the operations of the
Board of Trustees and its committees, the compensation of the Trustees
and their staff and the conduct of legal affairs for the Putnam funds.
The Committee also oversees the voting of proxies associated with
portfolio investments of the Putnam funds, with the goal of ensuring
that these proxies are voted in the best interest of the funds'
shareholders.

The Committee evaluates and recommends all candidates for election as
Trustees and recommends the appointment of members and chairs of each
board committee. The Committee also identifies prospective nominees for
election as trustee by considering individuals who come to its attention
through the recommendation of current Trustees, Putnam Management or
shareholders. Candidates properly submitted by shareholders (as
described below) will be considered and evaluated on the same basis as
candidates recommended by other sources. The Committee may, but is not
required to, engage a third-party professional search firm to assist it
in identifying and evaluating potential nominees.

When evaluating a potential candidate for membership on the Board of
Trustees, the Committee considers the skills and characteristics that it
feels would most benefit the Putnam funds at the time the evaluation is
made. The Committee may take into account a wide variety of attributes
in considering potential trustee candidates, including, but not limited
to: (i) availability and commitment of a candidate to attend meetings
and perform his or her responsibilities to the Board of Trustees, (ii)
other board experience, (iii) relevant industry and related experience,
(iv) educational background, (v) financial expertise, (vi) an assessment
of the candidate's ability, judgment and expertise, (vii) an assessment
of the perceived needs of the Board of Trustees and its committees at
that point in time and (viii) overall Board of Trustees composition. In
connection with this evaluation, the Committee will determine whether to
interview prospective nominees, and, if warranted, one or more members
of the Committee, and other Trustees and representatives of the funds,
as appropriate, will interview prospective nominees in person or by
telephone. Once this evaluation is completed, the Committee recommends
such candidates as it determines appropriate to the Independent Trustees
for nomination, and the Independent Trustees select the nominees after
considering the recommendation of the Committee.

The Committee will consider nominees for trustee recommended by
shareholders of a fund provided shareholders submit their
recommendations by the date disclosed in the paragraph entitled "Date
for receipt of shareholders' proposals for the next annual meeting," and
provided the shareholders' recommendations otherwise comply with
applicable securities laws, including Rule 14a-8 under the Securities
Exchange Act of 1934, as amended (the "1934 Act").

The Committee consists only of Independent Trustees. The Trustees have
adopted a written charter for the Board Policy and Nominating Committee,
a copy of which is attached to this proxy statement as Exhibit B. The
Committee currently consists of Dr. Kennan (Chairperson), Ms. Baxter and
Messrs. Hill, Mullin and Patterson.

Brokerage and Custody Committee. The Brokerage and Custody Committee
reviews the policies and procedures of the funds regarding the execution
of portfolio transactions for the funds, including policies regarding
the allocation of brokerage commissions and soft dollar credits. The
Committee reviews periodic reports regarding the funds' activities
involving derivative securities, and reviews and evaluates matters
relating to the funds' custody arrangements. The Committee currently
consists of Messrs. Jackson (Chairperson), Curtis and Mullin, Ms. Baxter
and Dr. Kennan.

Communication, Service and Marketing Committee. This Committee examines
the quality, cost and levels of services provided to the shareholders of
the Putnam funds. The Committee also reviews communications sent from
the funds to their shareholders, including shareholder reports,
prospectuses, newsletters and other materials. In addition, the
Committee oversees marketing and sales communications of the funds'
distributor. The Committee currently consists of Messrs. Putnam
(Chairperson), Smith and Stephens and Dr. Joskow.

Contract Committee. The Contract Committee reviews and evaluates, at
least annually, all arrangements pertaining to (i) the engagement of
Putnam Management and its affiliates to provide services to the funds,
(ii) the expenditure of the funds' assets for distribution purposes
pursuant to the distribution plans of the open-end funds and (iii) the
engagement of other persons to provide material services to the funds,
including in particular those instances where the cost of services is
shared between the funds and Putnam Management and its affiliates or
where Putnam Management or its affiliates have a material interest. The
Committee recommends to the Trustees such changes in arrangements as it
deems appropriate. The Committee also reviews the conversion of Class B
shares into Class A shares of the open-end funds in accordance with
procedures approved by the Trustees. After review and evaluation, the
Committee recommends to the Trustees the proposed organization of new
fund products and proposed structural changes to existing funds. Its
oversight of the closed-end funds includes (i) investment performance,
(ii) trading activity, (iii) determinations with respect to conversion
of a closed-end fund to an open-end fund, (iv) disclosure practices and
(v) the use and benefits of leverage. The Committee consists only of
Independent Trustees. The Committee currently consists of Ms. Baxter
(Chairperson), Messrs. Curtis, Jackson and Mullin and Dr. Kennan.

Distributions Committee. This Committee oversees all fund distributions
and approves the amount and timing of distributions paid by all the
funds to the shareholders when the Trustees are not in session. The
Committee also meets regularly with representatives of Putnam Management
and its affiliates to review distribution levels and the funds'
distribution policies. The Committee currently consists of Messrs.
Patterson (Chairperson) and Jackson and Dr. Joskow.

Executive Committee. The functions of the Executive Committee are
twofold. The first is to ensure that the funds' business may be
conducted at times when it is not feasible to convene a meeting of the
Trustees or for the Trustees to act by written consent. The Committee
may exercise any or all of the power and authority of the Trustees when
the Trustees are not in session. The second is to establish annual and
ongoing goals, objectives and priorities for the Board of Trustees and
to ensure coordination of all efforts between the Trustees and Putnam
Management and its affiliates on behalf of the shareholders of the
Putnam funds. The Committee currently consists of Messrs. Hill
(Chairperson), Jackson and Putnam, Dr. Joskow and Ms. Baxter.

Investment Oversight Committees. These Committees regularly meet with
investment personnel of Putnam Management to review the investment
performance and strategies of the Putnam funds in light of their stated
investment objectives and policies. Each such Committee will, among its
duties, identify any compliance issues that are unique to the category
of funds under its review and work with the appropriate board committees
to ensure that any such issues are properly addressed. Investment
Oversight Committee A currently consists of Ms. Baxter (Acting
Chairperson) and Mr. Smith. Investment Oversight Committee B currently
consists of Messrs. Curtis (Chairperson), Hill and Stephens. Investment
Committee C currently consists of Messrs. Mullin (Chairperson) and
Putnam and Dr. Kennan. Investment Oversight Committee D currently
consists of Messrs. Patterson (Chairperson), Jackson and Joskow.

* How large a stake do the Trustees and nominees have in the Putnam
family of funds?

The Trustees allocate their investments among the Putnam funds based on
their own investment needs. Each current Trustee, as of June 30, 2004,
owned at least 100 shares of each fund. The table below shows the number
of shares beneficially owned by each nominee for Trustee and the value
of each nominee's holdings in each fund and in all of the Putnam funds
as of June 30, 2004. As a group, the Trustees owned shares of the Putnam
funds valued at over $40 million as of June 30, 2004.

Putnam High Income Opportunities Trust
Dollar Range
of Putnam Aggregate Dollar
High Income Shares Range of Shares held
Opportunities Trust Beneficially in all of the
Name of Nominee Shares Owned Owned Putnam Funds
- ------------------------------------------------------------------------------------------------------

Jameson A. Baxter $1-$10,000 548 over $100,000
- ------------------------------------------------------------------------------------------------------
Charles B. Curtis $1-$10,000 114.822 over $100,000
- ------------------------------------------------------------------------------------------------------
Myra R. Drucker -- -- --
- ------------------------------------------------------------------------------------------------------
Charles E. Haldeman, Jr. -- -- over $100,000
- ------------------------------------------------------------------------------------------------------
John A. Hill $50,001-$100,000 3,322.164 over $100,000
- ------------------------------------------------------------------------------------------------------
Ronald J. Jackson $1-$10,000 200 over $100,000
- ------------------------------------------------------------------------------------------------------
Paul L. Joskow $1-$10,000 100 over $100,000
- ------------------------------------------------------------------------------------------------------
Elizabeth T. Kennan $1-$10,000 114.324 over $100,000
- ------------------------------------------------------------------------------------------------------
John H. Mullin, III $1-$10,000 108.258 over $100,000
- ------------------------------------------------------------------------------------------------------
Robert E. Patterson $1-$10,000 200 over $100,000
- ------------------------------------------------------------------------------------------------------
George Putnam, III over $100,000 10,500 over $100,000
- ------------------------------------------------------------------------------------------------------
W. Thomas Stephens $1-$10,000 100 over $100,000
- ------------------------------------------------------------------------------------------------------
A.J.C. Smith $1-$10,000 100 over $100,000
- ------------------------------------------------------------------------------------------------------
Richard B. Worley -- -- --
- ------------------------------------------------------------------------------------------------------

Putnam Managed High Yield Trust
Dollar Range
of Putnam Aggregate Dollar
Managed Shares Range of Shares held
High Yield Trust Beneficially in all of the
Name of Nominee Shares Owned Owned Putnam Funds
- --------------------------------------------------------------------------------------------------------

Jameson A. Baxter $1-$10,000 780 over $100,000
- --------------------------------------------------------------------------------------------------------
Charles B. Curtis $1-$10,000 125.249 over $100,000
- --------------------------------------------------------------------------------------------------------
Myra R. Drucker -- -- --
- --------------------------------------------------------------------------------------------------------
Charles E. Haldeman, Jr. -- -- over $100,000
- --------------------------------------------------------------------------------------------------------
John A. Hill $1-$10,000 229.847 over $100,000
- --------------------------------------------------------------------------------------------------------
Ronald J. Jackson $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Paul L. Joskow $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
Elizabeth T. Kennan $1-$10,000 186.817 over $100,000
- --------------------------------------------------------------------------------------------------------
John H. Mullin, III $1-$10,000 108.922 over $100,000
- --------------------------------------------------------------------------------------------------------
Robert E. Patterson $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
W. Thomas Stephens $1-$10,000 168.394 over $100,000
- --------------------------------------------------------------------------------------------------------
George Putnam, III $1-$10,000 500 over $100,000
- --------------------------------------------------------------------------------------------------------
A.J.C. Smith $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Richard B. Worley -- -- --
- --------------------------------------------------------------------------------------------------------

Putnam Master Income Trust
Dollar Range
of Putnam Aggregate Dollar
Master Shares Range of Shares held
Income Trust Beneficially in all of the
Name of Nominee Shares Owned Owned Putnam Funds
- --------------------------------------------------------------------------------------------------------

Jameson A. Baxter $1-$10,000 412.089 over $100,000
- --------------------------------------------------------------------------------------------------------
Charles B. Curtis $1-$10,000 118.763 over $100,000
- --------------------------------------------------------------------------------------------------------
Myra R. Drucker -- -- --
- --------------------------------------------------------------------------------------------------------
Charles E. Haldeman, Jr. -- -- over $100,000
- --------------------------------------------------------------------------------------------------------
John A. Hill $10,001-$50,000 3,142.364 over $100,000
- --------------------------------------------------------------------------------------------------------
Ronald J. Jackson $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Paul L. Joskow $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
Elizabeth T. Kennan $1-$10,000 138.561 over $100,000
- --------------------------------------------------------------------------------------------------------
John H. Mullin, III $1-$10,000 110.137 over $100,000
- --------------------------------------------------------------------------------------------------------
Robert E. Patterson $1-$10,000 300 over $100,000
- --------------------------------------------------------------------------------------------------------
W. Thomas Stephens $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
George Putnam, III $1-$10,000 500 over $100,000
- --------------------------------------------------------------------------------------------------------
A.J.C. Smith $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Richard B. Worley -- -- --
- --------------------------------------------------------------------------------------------------------

Putnam Tax-Free Health Care Fund
Dollar Range
of Putnam Aggregate Dollar
Tax-Free Shares Range of Shares held
Health Care Fund Beneficially in all of the
Name of Nominee Shares Owned Owned Putnam Funds
- --------------------------------------------------------------------------------------------------------

Jameson A. Baxter $1-$10,000 567 over $100,000
- --------------------------------------------------------------------------------------------------------
Charles B. Curtis $1-$10,000 113.993 over $100,000
- --------------------------------------------------------------------------------------------------------
Myra R. Drucker -- -- --
- --------------------------------------------------------------------------------------------------------
Charles E. Haldeman, Jr. -- -- over $100,000
- --------------------------------------------------------------------------------------------------------
John A. Hill $1-$10,000 205.617 over $100,000
- --------------------------------------------------------------------------------------------------------
Ronald J. Jackson $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Paul L. Joskow $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
Elizabeth T. Kennan $1-$10,000 102.997 over $100,000
- --------------------------------------------------------------------------------------------------------
John H. Mullin, III $1-$10,000 106.102 over $100,000
- --------------------------------------------------------------------------------------------------------
Robert E. Patterson $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
W. Thomas Stephens $1-$10,000 100 over $100,000
- --------------------------------------------------------------------------------------------------------
George Putnam, III $1-$10,000 500 over $100,000
- --------------------------------------------------------------------------------------------------------
A.J.C. Smith $1-$10,000 200 over $100,000
- --------------------------------------------------------------------------------------------------------
Richard B. Worley -- -- --
- --------------------------------------------------------------------------------------------------------

At June 30, 2004, the Trustees and officers of Putnam High Income
Opportunities Trust, Putnam Managed High Yield Trust, Putnam Master
Income Trust and Putnam Tax-Free Health Care Fund as a group owned less
than 1% of the outstanding shares of each fund on that date.

* What are some of the ways in which the Trustees represent shareholder
interests?

Among other ways, the Trustees seek to represent shareholder interests:

* by carefully reviewing your fund's investment performance on an
individual basis with your fund's investment team;

* by carefully reviewing the quality of the various other services
provided to the funds and their shareholders by Putnam Management and
its affiliates;

* by discussing with senior management of Putnam Management steps being
taken to address any performance deficiencies;

* by conducting an in-depth review of the fees paid by each fund and by
negotiating with Putnam Management to ensure that such fees remain
reasonable and competitive with those of other mutual funds, while at
the same time providing Putnam Management sufficient resources to
continue to provide high quality services in the future;

* by reviewing brokerage costs and fees, allocations among brokers, soft
dollar expenditures and similar expenses of each fund;

* by monitoring potential conflicts between the funds and Putnam
Management and its affiliates to ensure that the funds continue to be
managed in the best interests of their shareholders and

* by monitoring potential conflicts among funds to ensure that
shareholders continue to realize the benefits of participation in a
large and diverse family of funds.

* How can shareholders communicate with the Trustees?

The Board of Trustees provides a process for shareholders to send
communications to the Trustees. Shareholders may direct communications
to the Board of Trustees as a whole or to specified individual Trustees
by submitting them in writing to the following address:

The Putnam Funds
Attention: "Board of Trustees" or any specified Trustee(s)
One Post Office Square
Boston, Massachusetts 02109

The written communication must include the shareholder's name, be signed
by the shareholder, refer to the Putnam fund(s) in which the shareholder
holds shares and include the class and number of shares held by the
shareholder as of a recent date.

The Office of the Trustees will respond to all correspondence sent to
Trustees; however, due to the volume of correspondence, all
communications are not sent directly to the Trustees. The correspondence
is reviewed, summarized and presented to the Trustees on a periodic
basis.

* How often do the Trustees meet?

The Trustees meet each month (except in August) over a two-day period to
review the operations of your fund and of the other Putnam funds. A
portion of these meetings is devoted to meetings of various committees
of the board that focus on particular matters. Each Trustee generally
attends at least two formal committee meetings during each regular
meeting of the Trustees. In addition, the Trustees meet in small groups
with Chief Investment Officers, Portfolio Leaders and Portfolio Members
to review recent performance and the current investment climate for
selected funds. These meetings ensure that each fund's performance is
reviewed in detail at least twice a year. During 2003, the average
Trustee participated in approximately 49 committee and board meetings.
The Contract Committee typically meets on several additional occasions
during the year to carry out its responsibilities. Other committees,
including the Executive Committee, may also meet on special occasions as
the need arises. The number of times each committee met during your
fund's last fiscal year is shown in the table below:

Putnam High Income Opportunities Trust

Fiscal year ended February 29, 2004
- ----------------------------------------------------------
Audit and Pricing Committee 16
- ----------------------------------------------------------
Board Policy and Nominating Committee 6
- ----------------------------------------------------------
Brokerage and Custody Committee 4
- ----------------------------------------------------------
Communication, Service and Marketing Committee 10
- ----------------------------------------------------------
Contract Committee 15
- ----------------------------------------------------------
Distributions Committee 6
- ----------------------------------------------------------
Executive Committee 1
- ----------------------------------------------------------
Investment Oversight Committees 30
- ----------------------------------------------------------

Putnam Managed High Yield Trust

Fiscal year ended May 31, 2004
- ----------------------------------------------------------
Audit and Pricing Committee 18
- ----------------------------------------------------------
Board Policy and Nominating Committee 7
- ----------------------------------------------------------
Brokerage and Custody Committee 6
- ----------------------------------------------------------
Communication, Service and Marketing Committee 10
- ----------------------------------------------------------
Contract Committee 15
- ----------------------------------------------------------
Distributions Committee 6
- ----------------------------------------------------------
Executive Committee 1
- ----------------------------------------------------------
Investment Oversight Committees 31
- ----------------------------------------------------------

Putnam Master Income Trust

Fiscal year ended October 31, 2003
- ----------------------------------------------------------
Audit and Pricing Committee 12
- ----------------------------------------------------------
Board Policy and Nominating Committee 10
- ----------------------------------------------------------
Brokerage and Custody Committee 3
- ----------------------------------------------------------
Communication, Service and Marketing Committee 9
- ----------------------------------------------------------
Contract Committee 12
- ----------------------------------------------------------
Distributions Committee 6
- ----------------------------------------------------------
Executive Committee 1
- ----------------------------------------------------------
Investment Oversight Committees 34
- ----------------------------------------------------------

Putnam Tax-Free Health Care Fund

Your fund does not have a policy with respect to Trustees' attendance at
shareholder meetings. Your fund's last annual meeting was held while the
Trustees were conducting meetings of the Board and its committees.
Although your fund's Trustees did not attend the annual meeting, they
were represented at the meeting by their staff and were available in the
event that any material issues had arisen.

* What are the Trustees paid for their services?

Each Independent Trustee of your fund receives a fee for his or her
services. Each Independent Trustee also receives fees for serving as
Trustee of the other Putnam funds. Each Trustee of your fund receives an
annual retainer fee and an additional meeting fee for each Trustees'
meeting attended. Independent Trustees who serve on board committees
receive additional fees for attendance at certain committee meetings and
for special services rendered in that connection. All of the current
Independent Trustees are Trustees of all the Putnam funds and receive
fees for their services from each fund.

The Trustees periodically review their fees to assure that such fees
continue to be appropriate in light of their responsibilities as well as
in relation to fees paid to trustees of other mutual fund complexes. The
Board Policy and Nominating Committee, which consists solely of
Independent Trustees, estimates that committee and Trustee meeting time,
together with the appropriate preparation, requires the equivalent of at
least three business days per Trustee meeting. The following table shows
the fees paid to each current Trustee by your fund for its most recent
fiscal year and the fees paid to each current Trustee by all of the
Putnam funds during calendar year 2003:

Putnam High Income Opportunities Trust
Compensation Table
Retirement Estimated
benefits annual benefits Total
Aggregate accrued from all compensation
compensation as part Putnam from all
from of fund funds upon Putnam
Trustees/Year the fund (1) expenses retirement (2) funds (3)(4)
- -------------------------------------------------------------------------------------------------

Jameson A. Baxter/
1994 (5) $628 $191 $100,000 $215,500
- -------------------------------------------------------------------------------------------------
Charles B. Curtis/
2001 619 185 100,000 210,250
- -------------------------------------------------------------------------------------------------
John A. Hill/
1985 (5)(7) 1,022 225 200,000 413,625
- -------------------------------------------------------------------------------------------------
Ronald J. Jackson/
1996 (5) 626 180 100,000 214,500
- -------------------------------------------------------------------------------------------------
Paul L. Joskow/
1997 (5) 621 128 100,000 215,250
- -------------------------------------------------------------------------------------------------
Elizabeth T. Kennan/
1992 614 232 100,000 207,000
- -------------------------------------------------------------------------------------------------
John H. Mullin, III/
1997 (5) 619 198 100,000 208,750
- -------------------------------------------------------------------------------------------------
Robert E. Patterson/
1984 622 127 100,000 206,500
- -------------------------------------------------------------------------------------------------
George Putnam, III/
1984 (7) 771 104 125,000 260,500
- -------------------------------------------------------------------------------------------------
A.J.C. Smith/
1986 (6) -- -- -- --
- -------------------------------------------------------------------------------------------------
W. Thomas Stephens/
1997 (5) 613 179 100,000 206,500
- -------------------------------------------------------------------------------------------------

Putnam Managed High Yield Trust
Compensation Table
Retirement Estimated
benefits annual benefits Total
Aggregate accrued from all compensation
compensation as part Putnam from all
from of fund funds upon Putnam
Trustees/Year the fund (1) expenses retirement (2) funds (3)(4)
- -------------------------------------------------------------------------------------------------

Jameson A. Baxter/
1994 (5) $627 $189 $100,000 $215,500
- -------------------------------------------------------------------------------------------------
Charles B. Curtis/
2001 619 206 100,000 210,250
- -------------------------------------------------------------------------------------------------
John A. Hill/
1985 (5)(7) 991 229 200,000 413,625
- -------------------------------------------------------------------------------------------------
Ronald J. Jackson/
1996 (5) 624 184 100,000 214,500
- -------------------------------------------------------------------------------------------------
Paul L. Joskow/
1997 (5) 625 131 100,000 215,250
- -------------------------------------------------------------------------------------------------
Elizabeth T. Kennan/
1992 614 236 100,000 207,000
- -------------------------------------------------------------------------------------------------
John H. Mullin, III/
1997 (5) 619 202 100,000 208,750
- -------------------------------------------------------------------------------------------------
Robert E. Patterson/
1984 619 128 100,000 206,500
- -------------------------------------------------------------------------------------------------
George Putnam, III/
1984 (7) 768 105 125,000 260,500
- -------------------------------------------------------------------------------------------------
A.J.C. Smith/
1986 (6) -- -- -- --
- -------------------------------------------------------------------------------------------------
W. Thomas Stephens/
1997 (5) 616 184 100,000 206,500
- -------------------------------------------------------------------------------------------------

Putnam Master Income Trust
Compensation Table
Retirement Estimated
benefits annual benefits Total
Aggregate accrued from all compensation
compensation as part Putnam from all
from of fund funds upon Putnam
Trustees/Year the fund (1) expenses retirement (2) funds (3)(4)
- -------------------------------------------------------------------------------------------------

Jameson A. Baxter/
1994 (5) $920 $272 $100,000 $215,500
- -------------------------------------------------------------------------------------------------
Charles B. Curtis/
2001 910 230 100,000 210,250
- -------------------------------------------------------------------------------------------------
John A. Hill/
1985 (5)(7) 1,549 318 200,000 413,625
- -------------------------------------------------------------------------------------------------
Ronald J. Jackson/
1996 (5) 923 251 100,000 214,500
- -------------------------------------------------------------------------------------------------
Paul L. Joskow/
1997 (5) 910 193 100,000 215,250
- -------------------------------------------------------------------------------------------------
Elizabeth T. Kennan/
1992 903 328 100,000 207,000
- -------------------------------------------------------------------------------------------------
John H. Mullin, III/
1997 (5) 913 297 100,000 208,750
- -------------------------------------------------------------------------------------------------
Robert E. Patterson/
1984 914 179 100,000 206,500
- -------------------------------------------------------------------------------------------------
George Putnam, III/
1984 (7) 1,133 147 125,000 260,500
- -------------------------------------------------------------------------------------------------
A.J.C. Smith/
1986 (6) -- -- -- --
- -------------------------------------------------------------------------------------------------
W. Thomas Stephens/
1997 (5) 901 270 100,000 206,500
- -------------------------------------------------------------------------------------------------

Putnam Tax-Free Health Care Fund
Compensation Table
Retirement Estimated
benefits annual benefits Total
Aggregate accrued from all compensation
compensation as part Putnam from all
from of fund funds upon Putnam
Trustees/Year the fund (1) expenses retirement (2) funds (3)(4)
- -------------------------------------------------------------------------------------------------

Jameson A. Baxter/
1994 (5) $805 $240 $100,000 $215,500
Charles B. Curtis/
2001 794 262 100,000 210,250
John A. Hill/
1985 (5)(7) 1,271 291 200,000 413,625
Ronald J. Jackson/
1996 (5) 801 234 100,000 214,500
Paul L. Joskow/
1997 (5) 801 167 100,000 215,250
Elizabeth T. Kennan/
1992 788 300 100,000 207,000
John H. Mullin, III/
1997 (5) 794 257 100,000 208,750
Robert E. Patterson/
1984 794 163 100,000 206,500
George Putnam, III/
1984 (7) 986 134 125,000 260,500
A.J.C. Smith/
1986 (6) -- -- -- --
W. Thomas Stephens/
1997 (5) 791 234 100,000 206,500
- -------------------------------------------------------------------------------------------------

(1) Includes an annual retainer and an attendance fee for each meeting
attended.

(2) Assumes that each Trustee retires at the normal retirement date. For
Trustees who are not within three years of retirement, estimated
benefits for each Trustee are based on Trustee fee rates in effect
during calendar 2003.

(3) As of December 31, 2003, there were 101 funds in the Putnam family.
For Mr. Hill, amounts shown also include compensation for service as a
trustee of TH Lee, Putnam Emerging Opportunities Portfolio, a closed-end
fund advised by an affiliate of Putnam Management.

(4) Includes amounts (ranging from $2,000 to $11,000 per Trustee) for
which the Putnam funds were reimbursed by Putnam Management for special
Board and committee meetings in connection with certain regulatory and
other matters relating to alleged improper trading by certain Putnam
Management employees and participants in certain 401(k) plans
administered by Putnam Fiduciary Trust Company.

(5) Includes compensation deferred pursuant to a Trustee Compensation
Deferral Plan for each fund. As of the dates identified below, the total
amounts of deferred compensation payable by each fund to certain
Trustees, including income earned on such amounts, were as follows:

Putnam High Income Opportunities Trust (February 29, 2004) Ms. Baxter - $551,
Mr. Hill - $1,646, Mr. Jackson - $850, Mr. Joskow, - $610, Mr. Mullin - $629
and Mr. Stephens - $186.

Putnam Managed High Yield Trust (May 31, 2004) Ms. Baxter - $570,
Mr. Hill - $1,800, Mr. Jackson - $926, Mr. Joskow, - $645, Mr. Mullin - $650,
and Mr. Stephens - $192.

Putnam Master Income Trust (October 31, 2003) Ms. Baxter - $690,
Mr. Hill - $1,981, Mr. Jackson - $1,017, Mr. Joskow, - $750, Mr. Mullin - $789,
and Mr. Stephens - $310.

Putnam Tax-Free Health Care Fund (May 31, 2004) Ms. Baxter - $731,
Mr. Hill - $2,310, Mr. Jackson - $1,188, Mr. Joskow, - $828, Mr. Mullin - $834,
and Mr. Stephens - $246.

(6) Marsh & McLennan Companies, Inc. compensates Mr. Smith for his
service as Trustee. Mr. Smith has waived any retirement benefits that he
is entitled to receive under the Retirement Plan for Trustees of the
Putnam funds.

(7) Includes additional compensation to Messrs. Hill and Putnam for
service as Chairman of the Trustees and President of the Funds,
respectively.

Under a Retirement Plan for Trustees of the Putnam funds (the "Plan"),
each Trustee who retires with at least five years of service as a
Trustee of the funds is entitled to receive an annual retirement benefit
equal to one-half of the average annual compensation paid to such
Trustee for the last three years of service prior to retirement. This
retirement benefit is payable during a Trustee's lifetime, beginning the
year following retirement, for a number of years equal to such Trustee's
years of service. A death benefit, also available under the Plan,
assures that the Trustee and his or her beneficiaries will receive
benefit payments for the lesser of an aggregate period of (i) ten years
or (ii) such Trustee's total years of service.

The Plan Administrator (currently the Board Policy and Nominating
Committee) may terminate or amend the Plan at any time, but no
termination or amendment will result in a reduction in the amount of
benefits (i) currently being paid to a Trustee at the time of such
termination or amendment, or (ii) to which a current Trustee would have
been entitled had he or she retired immediately prior to such
termination or amendment. The Trustees have terminated the Plan with
respect to any Trustee first elected to the board after 2003.

Further Information About Voting and the Meeting

Quorum and methods of tabulation. The shareholders of each fund vote
separately with respect to the election of Trustees. In the case of each
fund, other than Putnam Master Income Trust, a majority of the shares
entitled to vote constitutes a quorum for the transaction of business
with respect to any proposal at the meeting (unless otherwise noted in
the proxy statement). For Putnam Master Income Trust, 30% of the shares
entitled to vote constitutes a quorum for the transaction of business.
Votes cast by proxy or in person at the meeting will be counted by
persons appointed by your fund as tellers for the meeting. The tellers
will count the total number of votes cast "for" approval of a proposal
for purposes of determining whether sufficient affirmative votes have
been cast. Shares represented by proxies that reflect abstentions and
"broker non-votes" (i.e., shares held by brokers or nominees as to which
(i) instructions have not been received from the beneficial owners or
the persons entitled to vote and (ii) the broker or nominee does not
have the discretionary voting power on a particular matter) will be
counted as shares that are present and entitled to vote on the matter
for purposes of determining the presence of a quorum. With respect to
the election of Trustees, neither abstentions nor broker non-votes have
an effect on the outcome of the proposal. With respect to any other
proposals, abstentions and broker non-votes have the effect of a vote
"against" the proposal.

Other business. The Trustees know of no matters other than those set
forth herein to be brought before the meeting. If, however, any other
matters properly come before the meeting, it is the Trustees' intention
that proxies will be voted on such matters in accordance with the
judgment of the persons named in the enclosed form of proxy.

Simultaneous meetings. The meeting of shareholders of your fund is
called to be held at the same time as the meetings of shareholders of
certain of the other Putnam funds. It is anticipated that all meetings
will be held simultaneously.

If any shareholder at the meeting objects to the holding of a
simultaneous meeting and moves for an adjournment of the meeting to a
time promptly after the simultaneous meetings, the persons named as
proxies will vote in favor of such adjournment.

Solicitation of proxies. In addition to soliciting proxies by mail,
Trustees of your fund and employees of Putnam Management, Putnam
Fiduciary Trust Company and Putnam Retail Management may solicit proxies
in person or by telephone. Your fund may arrange to have a proxy
solicitation firm call you to record your voting instructions by
telephone. The procedures for voting proxies by telephone are designed
to authenticate shareholders' identities, to allow them to authorize the
voting of their shares in accordance with their instructions and to
confirm that their instructions have been properly recorded. Your fund
has been advised by counsel that these procedures are consistent with
the requirements of applicable law. If these procedures were subject to
a successful legal challenge, such votes would not be counted at the
meeting. Your fund is unaware of any such challenge at this time.
Shareholders would be called at the phone number Putnam Management has
in its records for their accounts, and would be asked for their Social
Security number or other identifying information. The shareholders would
then be given an opportunity to authorize the proxies to vote their
shares at the meeting in accordance with their instructions. To ensure
that the shareholders' instructions have been recorded correctly, they
will also receive a confirmation of their instructions in the mail. A
special toll-free number will be available in case the information
contained in the confirmation is incorrect.

Shareholders have the opportunity to submit their voting instructions via
the Internet by utilizing a program provided by a third party vendor hired
by Putnam Management. The giving of such a proxy will not affect your right
to vote in person should you decide to attend the meeting. To use the
Internet, please access the Internet address listed on your proxy card and
follow the instructions on the Internet site. To record your voting
instructions via automated telephone service, use the toll-free number
listed on your proxy card. The Internet and telephone voting procedures are
designed to authenticate shareholder identities, to allow shareholders to
give their voting instructions and to confirm that shareholders'
instructions have been recorded properly. Shareholders voting via the
Internet should understand that there may be costs associated with
electronic access, such as usage charges from Internet access providers and
telephone companies, that must be borne by the shareholders.

Your fund's Trustees have adopted a general policy of maintaining
confidentiality in the voting of proxies. Consistent with this policy,
your fund may solicit proxies from shareholders who have not voted their
shares or who have abstained from voting.

Persons holding shares as nominees will, upon request, be reimbursed for
their reasonable expenses in soliciting instructions from their principals.
Your fund has retained at its own expense Investor Connect, 60 East 42nd
Street, New York, New York, 10165, to aid in the solicitation of
instructions for registered and nominee accounts, for a fee not to exceed
$1,000 plus reasonable out-of-pocket expenses, for each fund, for mailing.
The expenses of the preparation of proxy statements and related materials,
including printing and delivery costs, are borne by each fund.

Revocation of proxies. Proxies, including proxies given by telephone or
over the Internet, may be revoked at any time before they are voted
either (i) by a written revocation received by the Clerk of your fund,
(ii) by properly executing a later-dated proxy, (iii) by recording
later-dated voting instructions via the Internet or (iv) by attending
the meeting and voting in person.

Date for receipt of shareholders' proposals for the next annual meeting.
It is currently anticipated that your fund's next annual meeting of
shareholders will be held in October 2005. Shareholder proposals to be
included in the proxy statement for that meeting must be received by
your fund before April 12, 2005. Shareholders who wish to make a
proposal at the October 2005 annual meeting -- other than one that will
be included in the fund's proxy materials -- should notify the fund no
later than June 25, 2005. Shareholders who wish to propose one or more
nominees for election as Trustees, or to make a proposal fixing the
number of Trustees, at the October 2005 annual meeting must provide
written notice to the fund (including all required information) so that
such notice is received in good order by the fund no earlier than July
16, 2005 and no later than August 15, 2005.

The Board Policy and Nominating Committee will also consider nominees
recommended by shareholders of the fund to serve as Trustees. A
shareholder must submit the names of any such nominees in writing to the
fund, to the attention of the Clerk, at the address of the principal
offices of the fund.

If a shareholder who wishes to present a proposal fails to notify the
fund by the dates specified above, the proxies solicited for the meeting
will have discretionary authority to vote on the shareholder's proposal
if it is properly brought before the meeting. If a shareholder makes a
timely notification, the proxies may still exercise discretionary voting
authority under circumstances consistent with the SEC's proxy rules.

Adjournment. If sufficient votes in favor of any of the proposals set
forth in the Notice of the Meeting are not received by the time
scheduled for the meeting, the persons named as proxies may propose
adjournments of the meeting for a period or periods of not more than 60
days in the aggregate to permit further solicitation of proxies. Any
adjournment will require the affirmative vote of a majority of the votes
cast on the question in person or by proxy at the session of the meeting
to be adjourned. The persons named as proxies will vote in favor of
adjournment those proxies that they are entitled to vote in favor of the
proposals. They will vote against any such adjournment those proxies
required to be voted against the proposals. Your fund pays the costs of
any additional solicitation and of any adjourned session. Any proposals
for which sufficient favorable votes have been received by the time of
the meeting may be acted upon and considered final regardless of whether
the meeting is adjourned to permit additional solicitation with respect
to any other proposal.

Financial information. Your fund will furnish to you upon request and
without charge, a copy of the fund's annual report for its most recent
fiscal year, and a copy of its semiannual report for any subsequent
semiannual period. Such requests may be directed to Putnam Investor
Services, P.O. Box 41203, Providence, RI 02940-1203 or 1-800-225-1581.

Fund Information

Putnam Investments. Putnam Investment Management, LLC, each fund's
investment manager, is a subsidiary of Putnam Management Trust, which is in
turn owned by Putnam Investments. Putnam Investments is a wholly-owned
subsidiary of Putnam Investments Trust, a holding company that, except for a
minority stake owned by employees, is in turn owned by Marsh & McLennan
Companies, Inc., a leading professional services firm that includes risk and
insurance services, investment management and consulting businesses. Putnam
Fiduciary Trust Company, the fund's investor servicing agent and custodian,
is also a subsidiary of Putnam Investments. The address of Putnam
Investments Trust, Putnam Investments, Putnam Investment Management, LLC,
and Putnam Fiduciary Trust Company is One Post Office Square, Boston,
Massachusetts 02109. The address of the executive offices of Marsh &
McLennan Companies, Inc. is 1166 Avenue of the Americas, New York, New York
10036.

Litigation. Exhibit C to this proxy statement describes the pending
legal proceedings in which the Trustees have been named as parties
adverse to your fund.

Limitation of Trustee liability. The Agreement and Declaration of Trust
of each fund provides that the fund will indemnify its Trustees and
officers against liabilities and expenses incurred in connection with
litigation in which they may be involved because of their offices with
the fund, except if it is determined in the manner specified in the
Agreement and Declaration of Trust that they have not acted in good
faith in the reasonable belief that their actions were in the best
interests of the fund or that such indemnification would relieve any
officer or Trustee of any liability to the fund or its shareholders
arising by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of his or her duties. Your fund, at its expense,
provides liability insurance for the benefit of its Trustees and
officers.

Independent Registered Public Accounting Firm. KPMG LLP, 99 High Street,
Boston, Massachusetts 02110, an independent registered public accounting
firm, has been selected by the Trustees as the independent auditors of
your fund for the current fiscal year. The Audit and Pricing Committee
and the full Board of Trustees unanimously approved the selection of
KPMG LLP as independent auditors in July 1999 for Putnam Master Income
Trust and July 2000 for Putnam High Income Opportunities Trust, Putnam
Managed High Yield Trust and Putnam Tax-Free Health Care Fund.

Among the country's preeminent independent registered public accounting
firms, KPMG LLP also serves as auditors for various other funds in the
Putnam family of funds. It was selected primarily on the basis of its
expertise as auditors of investment companies, the quality of its audit
services and the competitiveness of its fees. Representatives of KPMG
LLP are expected to be present at the meeting to make statements and to
respond to appropriate questions.

The following table presents fees billed in each of the last two fiscal
years for services rendered to each fund by the fund's independent
auditors:

Audit- All
Audit Related Tax Other
Fiscal year ended Fees Fees Fees Fees
- --------------------------------------------------------------------------------------

Putnam High Income Opportunities Trust
February 29, 2004 $36,700 $0 $2,800 $0
February 28, 2003 34,650 0 2,650 10
- --------------------------------------------------------------------------------------
Putnam Managed High Yield Trust
May 31, 2004 $35,200 $0 $3,300 $12
May 31, 2003 33,200 0 3,100 0
- --------------------------------------------------------------------------------------
Putnam Master Income Trust
October 31, 2003 $34,100 $0 $3,600 $0
October 31, 2002 32,200 0 3,400 0
- --------------------------------------------------------------------------------------
Putnam Tax-Free Health Care Fund
May 31, 2004 $26,000 $0 $3,600 $35
May 31, 2003 24,600 0 3,400 0
- --------------------------------------------------------------------------------------

Audit Fees represents fees billed for a fund's last two fiscal years.

Audit-Related Fees represents fees billed in a fund's last two fiscal
years for services traditionally performed by the fund's auditors,
including accounting consultation for proposed transactions or
concerning financial accounting and reporting standards and other audit
or attest services not required by statute or regulation.

Tax Fees represents fees billed in a fund's last two fiscal years for
tax compliance, tax planning and tax advice services. Tax planning and
tax advice services include assistance with tax audits, employee benefit
plans and requests for rulings or technical advice from taxing
authorities.

All Other Fees represents fees billed for services relating to interfund
trading.

The following table presents the amounts KPMG LLP billed for aggregate
non-audit fees in each of the last two fiscal years to each fund, Putnam
Management and any entity controlling, controlled by or under common
control with Putnam Management that provides ongoing services to the
fund:

Fiscal year ended
- ------------------------------------------------------
Putnam High Income Opportunities Trust
February 29, 2004 $2,800
February 28, 2003 2,660
- ------------------------------------------------------
Putnam Managed High Yield Trust
May 31, 2004 $3,312
May 31, 2003 3,100
- ------------------------------------------------------
Putnam Master Income Trust
October 31, 2003 $3,600
October 31, 2002 3,400
- ------------------------------------------------------
Putnam Tax-Free Health Care Fund
May 31, 2004 $3,635
May 31, 2003 3,400
- ------------------------------------------------------

Pre-Approval Policies of the Audit and Pricing Committee. The Audit and
Pricing Committee has determined that, as a matter of policy, all work
performed for the funds by the funds' independent auditors will be
pre-approved by the Committee and will generally not be subject to
pre-approval procedures.

Under certain circumstances, the Audit and Pricing Committee believes
that it may be appropriate for Putnam Management and certain of its
affiliates to engage the services of the funds' independent auditors,
but only after prior approval by the Committee. Such requests are
required to be submitted in writing to the Committee and explain, among
other things, the nature of the proposed engagement, the estimated fees
and why this work must be performed by that particular audit firm. The
Committee will review the proposed engagement at its next meeting.

Since May 6, 2003, all work performed by the independent auditors for
the funds, Putnam Management and any entity controlling, controlled by
or under common control with Putnam Management that provides ongoing
services to the funds was pre-approved by the Committee or a member of
the Committee pursuant to the pre-approval policies discussed above.
Prior to that date, the Committee had a general policy to pre-approve
the independent auditors' engagements for non-audit services with the
funds, Putnam Management and any entity controlling, controlled by or
under common control with Putnam Management that provides ongoing
services to the funds.

For each fund's last two fiscal years, the funds' principal auditors did
not bill for services required to be approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X.

The Audit and Pricing Committee of your fund has submitted the following
report:

The Audit and Pricing Committee has reviewed and discussed with
management of your fund the audited financial statements for the last
fiscal year. The Audit and Pricing Committee has discussed with your
fund's independent auditors the matters required to be discussed by
Statements on Auditing Standard No. 61 (SAS 61). SAS 61 requires
independent auditors to communicate to the Audit and Pricing Committee
matters including, if applicable: (1) methods used to account for
significant unusual transactions; (2) the effect of significant
accounting policies in controversial or emerging areas for which there
is a lack of authoritative guidance or consensus; (3) the process used
by management in formulating particularly sensitive accounting estimates
and the basis for the auditor's conclusions regarding the reasonableness
of those estimates and (4) disagreements with management over the
application of accounting principles and certain other matters. The
Audit and Pricing Committee has received the written disclosures and the
letter from your fund's independent auditors required by the SEC's
Independence Standards Board Standard No. 1 (among other things,
requiring auditors to make written disclosures to and discuss with the
Audit and Pricing Committee various matters relating to the auditor's
independence), and has discussed with such accountants the independence
of such accountants. Based on the foregoing review and discussions, the
Audit and Pricing Committee recommended to the Trustees that the audited
financial statements for the last fiscal year be included in your fund's
annual report to shareholders for the last fiscal year.

Paul L. Joskow (Chairperson)
Elizabeth T. Kennan
Robert E. Patterson
W. Thomas Stephens

Officers and other information. All of the officers of your fund, with
the exception of George Putnam, III, are employees of Putnam Management
or its affiliates. Because of their positions with Putnam Management or
its affiliates or their ownership of stock of Marsh & McLennan
Companies, Inc., the parent corporation of Putnam Investments Trust and
indirectly of Putnam Investments, Messrs. Haldeman, Putnam and Smith
(nominees for Trustees of your fund), as well as the officers of your
fund, will benefit from the management fees, underwriting commissions,
custodian fees, and investor servicing fees paid or allowed by the fund.
In addition to Mr. Putnam, III, the other officers of each fund are as
follows:

Year first
Name (birthdate) elected Business experience
Office with the fund to office during past five years
- -----------------------------------------------------------------------------------------

Charles E. Porter (7/26/38)* 1989 Managing Director,
Executive Vice President, Putnam Investments
Associate Treasurer and and Putnam Management
Principal Executive Officer
- -----------------------------------------------------------------------------------------
Jonathan S. Horwitz (6/4/55)* 2004 Managing Director,
Senior Vice President and Treasurer Putnam Investments
- -----------------------------------------------------------------------------------------
Steven D. Krichmar (6/27/58) 2002 Senior Managing Director,
Vice President and Principal Putnam Investments.
Financial Officer Prior to 2001, Mr. Krichmar
was a Partner at
PricewaterhouseCoopers, LLP
- -----------------------------------------------------------------------------------------
Michael T. Healy (1/24/58) 2000 Managing Director,
Assistant Treasurer and Principal Putnam Investments
Accounting Officer
- -----------------------------------------------------------------------------------------
Beth S. Mazor (4/6/58) 2002 Senior Vice President,
Vice President Putnam Investments
- -----------------------------------------------------------------------------------------
Daniel T. Gallagher (2/27/62)* 2004 Vice President, Putnam
Vice President and Legal and Investments. Prior to
Compliance Liaison Officer 2004, Mr. Gallagher was an
Associate for Ropes &
Gray LLP; prior to 2000,
he was a Law Clerk for the
Massachusetts Supreme
Judicial Court.
- -----------------------------------------------------------------------------------------
Mark C. Trenchard (6/5/62) 2002 Senior Vice President,
Vice President and BSA Compliance Officer Putnam Investments
- -----------------------------------------------------------------------------------------
Francis J. McNamara, III (8/19/55) 2004 Senior Managing Director,
Vice President and Chief Legal Officer Putnam Investments,
Putnam Management
and Putnam Retail
Management. Prior
to 2004, Mr. McNamara
was General Counsel
of State Street Research
& Management.
- -----------------------------------------------------------------------------------------
James P. Pappas (2/24/53) 2004 Managing Director,
Vice President Putnam Investments and
Putnam Management.
During 2002, Mr. Pappas
was Chief Operating
Officer of Atalanta/
Sosnoff Management
Corporation; prior to
2001, he was President
and Chief Executive
Officer of UAM
Investment Services, Inc.
- -----------------------------------------------------------------------------------------
Richard S. Robie, III (3/30/60) 2004 Senior Managing Director,
Vice President Putnam Investments,
Putnam Management
and Putnam Retail
Management. Prior to
2003, Mr. Robie was Senior
Vice President of United
Asset Management
Corporation.
- -----------------------------------------------------------------------------------------
Judith Cohen (6/7/45)* 1993 Clerk and Assistant
Clerk and Assistant Treasurer Treasurer, The Putnam Funds
- -----------------------------------------------------------------------------------------

* Officers of each fund who are members of the Trustees' independent
administrative staff. Compensation for these officers is fixed by the
Trustees and reimbursed by Putnam Management.

Shares outstanding of your fund as of June 30, 2004
- -------------------------------------------------------------------------------
Putnam High Income Opportunities Trust 3,712,567 shares
- -------------------------------------------------------------------------------
Putnam Managed High Yield Trust 7,507,107 shares
- -------------------------------------------------------------------------------
Putnam Master Income Trust 53,329,917 shares
- -------------------------------------------------------------------------------
Putnam Tax-Free Health Care Fund 13,807,168 shares
- -------------------------------------------------------------------------------

As of June 30, 2004, to the knowledge of the fund, no person owned
beneficially or of record 5% or more of any class of shares of each fund.

EXHIBIT A

THE PUTNAM FUNDS

Audit and Pricing Committee Charter

MAY 2004

Purpose. The purpose of the Audit and Pricing Committee (the
"Committee") is to oversee and assist Trustee oversight of: the
integrity of the Funds' financial statements, including overseeing
accounting and financial reporting processes of the Funds and the audits
of the Funds' financial statements; the Funds' compliance with legal and
regulatory requirements; the independent auditors' qualifications and
independence; the performance of the Funds' internal audit function, if
any, and independent auditors; and the valuation of the Funds' assets.

The Committee is directly responsible for the appointment, terms of
engagement, termination, compensation, and oversight of the work of the
independent auditors employed by the Funds (including resolution of
disagreements between management and the independent auditors regarding
financial reporting), and the independent auditors shall report directly
to the Committee.1 The Committee is also directly responsible for
preparing an audit committee report required to be included in the
annual proxy statement for the closed-end Funds. The Board of Trustees
(the "Board") and the Funds' shareholders shall have such rights to
approve, ratify and replace the Funds' independent auditors as are
required by applicable law.

Composition. The Committee will be comprised exclusively of
"independent" Trustees, as such term is interpreted for purposes of
Rule 10A-3(b)(1) of the Securities Exchange Act of 1934, as amended, and
the listing standards of each exchange on which shares of one or more of
The Putnam Funds are traded (each an "Exchange"). In addition, none of
the Committee's members will be "interested persons" of the Funds as
that term is defined under the Investment Company Act of 1940, as
amended. The Committee shall have at least three members, who shall
collectively satisfy the independence, financial sophistication and
financial literacy listing standards of each Exchange, as financial
literacy is interpreted by the Board. Committee members may serve on the
audit committee of more than three listed companies, provided that the
Board determines that such simultaneous service would not impair the
ability of the member to serve effectively on the Committee.

1 For purposes of this Charter, the term "management" refers to the
relevant officers of the Funds, including officers that comprise the
staff of the Office of the Trustees, as well as relevant officers and
employees of Putnam Investments and its affiliates.

Assistance. The Committee may seek the assistance of the staff of the
Office of the Trustees, the Funds' independent auditors and counsel,
management and other parties as it may deem appropriate.

Funding. The Funds will provide the necessary funding as determined by
the Committee (i) to compensate the Funds' independent auditors and any
advisers employed by or at the direction of the Committee and (ii) to
pay ordinary administrative expenses of the Committee that are necessary
or appropriate in carrying out its duties.

Specific Duties of Committee. The duties of the Committee include:

* Obtaining and reviewing, at least annually, a formal, written report
by the independent auditors describing: the auditors' internal
quality-control procedures; any material issues raised by the most
recent internal quality-control review, or peer review, of the auditors,
or by any inquiry or investigation by governmental or professional
authorities, within the preceding five years, respecting one or more
independent audits carried out by the auditors, and any steps taken to
deal with any such issues; and (to assess the auditors' independence),
consistent with Independent Standards Board Standard 1, all
relationships between the independent auditors, management and the
Funds;

* Actively engaging in a dialogue with the independent auditors with
respect to any disclosed relationships or services that may impact the
objectivity and independence of the independent auditors and
recommending that the Trustees take appropriate action in response to
the independent auditors' report to satisfy themselves of the
independent auditors' independence;

* Reviewing the arrangements for and scope of the annual audit and any
special audits;

* Conducting meetings at least quarterly;

* Evaluating Committee performance at least annually;

* For Funds whose shares are traded on an Exchange, discussing the
annual audited financial statements and semiannual or any other periodic
financial statements with Fund management and the independent auditors,
including the Funds' disclosures under "Management's Discussion of Fund
Performance";

* Discussing with management, guidelines and policies with respect to
risk assessment and risk management;

* Meeting separately and periodically with management, with internal
auditors (or other personnel responsible for the internal audit
function, if any) and with the independent auditors;

* Reviewing with the independent auditors any audit problems or
difficulties and management's response to such issues, and to resolve
any disagreements between management and the independent auditors;

* Setting clear hiring policies by the Funds for employees or former
employees of the independent auditors;

* Establishing procedures for (A) the receipt, retention, and treatment
of complaints received by the Funds regarding accounting, internal
accounting controls, or auditing matters, and (B) confidential,
anonymous submissions regarding questionable accounting or auditing
matters;

* Reviewing, at least annually, (A) major issues regarding accounting
principles and financial statement presentations, including any
significant changes in the Funds' selection or application of accounting
principles, and major issues as to the adequacy of the Funds' internal
controls and any special audit steps adopted in light of material
control deficiencies; (B) analyses prepared by management and/or the
independent auditors setting forth significant financial reporting
issues and judgments made in connection with the preparation of the
financial statements, including analyses of the effects of alternative
GAAP methods on the financial statements; (C) the effect of regulatory
and accounting initiatives, as well as off-balance sheet structures, on
the financial statements of the Funds; and (D) earnings press releases
(paying particular attention to any use of "pro forma," or "adjusted"
non-GAAP, information), if any, as well as financial information and
earnings guidance provided to analysts and rating agencies;

* Reviewing scope and adequacy of audits;

* Reporting regularly to the Board of Trustees to review any issues that
arise with respect to the quality or integrity of the Funds' financial
statements, the Funds' compliance with legal or regulatory requirements,
the performance, qualifications and independence of the Funds'
independent auditor, and the performance of the Funds' internal audit
function (if any);

* Pre-approving any work performed by the Funds' auditors, as required
by applicable law or the rules of any Exchange;

* Reviewing matters relating to the Funds' Code of Ethics and Putnam
Investments' Code of Ethics;

* Reviewing compliance matters identified to the Committee;

* Reviewing compliance by Putnam money market funds with SEC Rule 2a-7;

* Reviewing interfund transactions pursuant to SEC Rule 17a-7;

* Monitoring the valuation of the Funds' assets, including reviewing
various reports prepared by Putnam Management;

* Reassessing annually the adequacy of this Charter and recommending any
proposed changes to the full Board of Trustees; and

* Performing such other functions and having such powers as may be
necessary and appropriate in the efficient and lawful discharge of the
powers provided in this Charter.

Role and Responsibilities of the Committee. The function of the
Committee is oversight; it is management's responsibility to maintain
appropriate systems for accounting and internal control over financial
reporting, and the independent auditors' responsibility to plan and
carry out a proper audit. Specifically, a Fund's management is
responsible for: (1) the preparation, presentation and integrity of the
Fund's financial statements; (2) the maintenance of appropriate
accounting and financial reporting principles and policies; and (3) the
maintenance of internal control over financial reporting and other
procedures designed to assure compliance with accounting standards and
related laws and regulations. The independent auditors are responsible
for planning and carrying out an audit consistent with applicable legal
and professional standards and the terms of their engagement letter.
Nothing in this Charter shall be construed to reduce the
responsibilities or liabilities of a Fund's service providers, including
the independent auditors.

The review of a Fund's financial statements by the Committee is not an
audit, nor does the Committee's review substitute for the
responsibilities of the Funds' management for preparing, or the
independent auditors for auditing, the financial statements. Members of
the Committee are not full-time employees of the Funds and, in serving
on the Committee, are not, and do not hold themselves out to be, acting
as accountants or auditors. As such, it is not the duty or
responsibility of the Committee or its members to conduct "field work"
or other types of auditing or accounting reviews or procedures.

In discharging their duties, the members of the Committee are entitled
to rely on information, opinions, reports, or statements, including
financial statements and other financial data, if prepared or presented
by: (1) one or more officers of the Funds whom the Committee member
reasonably believes to be reliable and competent in the matters
presented; (2) legal counsel, public accountants, or other persons as to
matters the Committee member reasonably believes are within the person's
professional or expert competence; or (3) a Board committee of which the
Committee member is not a member.

EXHIBIT B

THE PUTNAM FUNDS

Board Policy and Nominating Committee Charter

This Committee reviews matters pertaining to the operations of the
Board of Trustees and its Committees and the conduct of legal affairs
for the Funds. The Committee evaluates and recommends all candidates for
election as Trustees and recommends the appointment of members and
chairs of each board committee. The Committee also reviews policy
matters affecting the operation of the Board and its independent staff
and make recommendations to the Board as appropriate. The Committee also
oversees the voting of proxies associated with portfolio investments of
The Putnam Funds with the goal of ensuring that these proxies are voted
in the best interest of the Funds' shareholders. The Committee is
comprised exclusively of Independent Trustees.

EXHIBIT C

Litigation

1. The plaintiff named below alleges that the defendants engaged in, or
allowed others to engage in, activities that took advantage of the way
mutual fund shares are priced in exchange for investments that benefited
the managers and advisers of the funds, but which harmed investors and the
funds themselves. The plaintiff's complaint sets forth violations of
[SECTION] 36 of the 1940 Act, [SECTION] 206 of the Investment Advisers Act
of 1940, as amended (the "Advisers Act"), [SECTION] 10(b) and [SECTION]
20(a) of the 1934 Act, breach of fiduciary duty and civil conspiracy. The
plaintiff seeks declaratory relief, damages, pre and post judgment interest
and attorney's fees and costs.

Case Name Defendants Court Date Instituted
- -------------------------------------------------------------------------------
Gladys Baker Putnam Management 1 United States April 5, 2004
(derivatively on Omid Kamshad District Court
behalf of the Putnam Justin Scott for the District
Fund for Growth & Putnam Trustees 2 of Delaware
Income, Putnam Putnam Funds 3
Europe Equity Fund, (nominal)
and the Putnam Funds)
v. Putnam Investment
Management LLC, et al.
- -------------------------------------------------------------------------------

2. The plaintiffs named below allege that the defendants engaged in,
permitted and/or failed to prevent market timing and short-term trading in
the Putnam Funds. Plaintiffs generally claim violations of [SECTION] 36 of
the 1940 Act, [SECTION] 206 of the Advisers Act, [SECTION] 10(b) of the
1934 Act and Rule 10b-5, [SECTION] 20(a) of the 1934 Act, breach of
fiduciary duty, aiding and abetting breach of fiduciary duty and civil
conspiracy. The plaintiffs generally seek injunctive relief including
removal of the current Trustees and fund managers, disgorgement of profits,
monetary damages, punitive damages and attorney's fees and costs.

Case Name Defendants Court Date Instituted
- -------------------------------------------------------------------------------
Joanne S. Baseman Putnam Management United States Dec. 16, 2003
(derivatively on behalf Omid Kamshad District Court
of Putnam International Justin Scott for the District
Equity Fund and the William Woolverton of Maryland
Putnam Funds) Putnam Trustees
v. Putnam Investment Putnam Funds
Management, Inc., et al. (nominal)
- -------------------------------------------------------------------------------
John K. Clement Putnam Management United States Nov. 26, 2003
(derivatively on behalf Omid Kamshad District Court
of several individual Justin Scott for the District
funds and the William Woolverton of Maryland
Putnam Funds) Putnam Trustees
v. Putnam Investment Putnam Funds
Management Inc., et al. (nominal)
- -------------------------------------------------------------------------------
Simon J. Denenberg Putnam Management United States Jan. 30, 2004
(derivatively on behalf Omid Kamshad District Court
of the Putnam U.S. Justin Scott for the District
Government Income William Woolverton of Maryland
Trust and the Putnam Putnam Trustees
Funds) v. Putnam Putnam Funds
Investment Management, (nominal)
Inc., et al.
- -------------------------------------------------------------------------------
Diane Hutto and Putnam Management United States Nov. 12, 2003
Dina Rozenbaum Putnam Trustees District Court
(derivatively on behalf Justin M. Scott for the District
of several individual Omid Kamshad of Maryland
funds and the Putnam Certain officers of
Funds) v. Putnam, LLC, the Putnam Funds and
et. al. Putnam Management
John Does 1-100
Putnam Funds
(nominal)
- -------------------------------------------------------------------------------
Seth B. Marks Putnam Management United States Dec. 3, 2003
(derivatively on behalf Putnam Trustees District Court
of several individual Justin M. Scott for the District
funds and the Putnam Omid Kamshad of Maryland
Funds) v. Putnam, LLC, Certain officers of
et. al. the Putnam Funds and
Putnam Management
John Does 1-100
Putnam Funds
(nominal)
- -------------------------------------------------------------------------------
Cynthia Puleo Putnam Management United States Dec. 16, 2003
(derivatively on behalf Putnam Trustees District Court
of several individual Justin M. Scott for the District
funds and the Putnam Omid Kamshad of Maryland
Funds) v. Putnam, LLC, Certain officers of
et al. the Putnam Funds and
Putnam Management
John Does 1-100
Putnam Funds
(nominal)
- -------------------------------------------------------------------------------
Edward L. Segel Putnam Management United States Jan. 23, 2004
(derivatively on behalf Putnam Trustees District Court
of individual fund Omid Kamshad for the District
and the Putnam Funds) Justin Scott of Maryland
v. Putnam, LLC, et al. William Woolverton
Putnam Funds
(nominal)
- -------------------------------------------------------------------------------
Zachary Alan Starr Putnam Management United States Nov. 6, 2003
(derivatively on behalf Putnam Trustees District Court
of Putnam International Omid Kamshad for the District
Equity Fund and the Justin M. Scott of Maryland
Putnam Funds) Putnam Funds
v. Putnam Investment (nominal)
Management, et al.
- -------------------------------------------------------------------------------

3. The plaintiffs named below allege that the defendants failed to
properly disclose that select customers were allowed to engage in late
trading or time their mutual fund trades. The plaintiffs generally claim of
breach of fiduciary duty, abuse of control, gross mismanagement, waste of
corporate assets and unjust enrichment. The plaintiffs seek damages,
equitable and/or injunctive relief, restitution and attorney's fees and
costs.

Case Name Defendants Court Date Instituted
- -------------------------------------------------------------------------------
Leon Brazin Putnam Trustees Superior Court March 15, 2004
(derivatively on behalf Putnam Management of Suffolk
of Putnam Vista Fund) Putnam Vista Fund County, MA;
v. John A. Hill, et al. (nominal) Stipulation
Certain officers of agreeing to
the Putnam Funds and removal and
Putnam Management transfer to
United States
District Court for
the District of
Maryland executed
on April 23, 2004
- -------------------------------------------------------------------------------
Peter Kavaler Putnam Trustees Superior Court March 15, 2004
(derivatively on behalf Putnam Management of Suffolk
of Putnam Income Putnam Income Fund County, MA;
Fund) v. John A. Hill, (nominal) Stipulation
et al. Certain officers of agreeing to
the Putnam Funds and removal and
Putnam Management transfer to
United States
District Court for
the District of
Maryland executed
on April 23, 2004
- -------------------------------------------------------------------------------
Todd Klein (derivatively Putnam Trustees United States Jan. 27, 2004
on behalf of Putnam Putnam Management District Court
Global Equity Fund) Putnam Global for the District
v. John A. Hill, et al. Equity Fund of Maryland
(nominal)
Certain officers
of the Putnam Funds
and Putnam Management
- -------------------------------------------------------------------------------
Steven Wiegand Putnam Trustees United States Jan. 27, 2004
(derivatively on behalf Putnam Management District Court
of Putnam Classic Putnam Classic for the District
Equity Fund) Equity Fund of Maryland
v. John A. Hill et al. (nominal)
Certain officers
of the Putnam Funds
and Putnam Management
- -------------------------------------------------------------------------------

4. The plaintiff named below alleges that defendants failed to prevent the
disclosure of confidential information concerning the identity of
securities, the practice of late trading by selected investors,
time-trading by selected investors and insider trading by directors,
officers and/or employees of the defendants. The plaintiff claims breach of
fiduciary duty.

Case Name Defendants Court Date Instituted
- -------------------------------------------------------------------------------
Stern (derivatively Putnam Funds Supreme Court December 17, 2003
on behalf of Marsh & Putnam Management of the State
McLennan) v. Greenberg, Jeffrey Greenberg of New York
et. al. Mathis Cabaillavetta
Marsh Directors 4
Lawrence Lasser
- -------------------------------------------------------------------------------

1 "Putnam Management" includes Putnam Investments Trust, Putnam Investment
Management, Putnam Investment Management, LLC, Putnam, LLC, and/or Marsh &
McLennan Companies, Inc.

2 The 13 Putnam Trustees include current Trustees Jameson Adkins Baxter,
Charles B. Curtis, John A. Hill, Ronald J. Jackson, Paul L. Joskow,
Elizabeth T. Kennan, John H. Mullin, III, Robert E. Patterson, George
Putnam, III, A.J.C. Smith and W. Thomas Stephens and former Trustees W.
Nicholas Thorndike and Lawrence J. Lasser.

3 "Putnam Funds" includes any and/or all registered investment companies
managed by Putnam Management.

4 The Directors of Marsh & McLennan Companies, Inc. are Charles Davis,
Lewis Bernard, Peter Coster, Robert Ebruru, Oscar Fanjul, Ray Groves,
Stephen Hardis, Gwendolyn King, Lord Lang of Monkton, David Olsen, Morton
Shapiro, Adele Simmons and A.J.C. Smith.

PUTNAM INVESTMENTS

The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
Toll-free 1-800-225-1581 216441 8/04

Your vote is important. Please vote immediately.

To vote by mail:

* Read the proxy statement.

* Check one of the appropriate
boxes on the reverse side.

* Sign and date the proxy card.

* Return the proxy card in the
envelope provided.

To vote by telephone:

* Read the proxy statement and
have the proxy card at hand.

* Call 1-877-779-8683.

* Follow the automated telephone directions.

* There is no need for you to
return your proxy card.

To vote on the web:

* Read the proxy statement and
have the proxy card at hand.

* Go to
https://www.eproxyvote.com/putnam1

* Follow the instructions on the site.

* There is no need for you to
return your proxy card.

If you vote over the Internet or by telephone, please do not mail your
card.

Proxy card for a meeting of shareholders to be held on October 14, 2004,
for Putnam High Income Opportunities Trust.

You, as a Putnam fund shareholder, by signing this proxy card, appoint John
A. Hill and Robert E. Patterson, and each of them separately, as your
proxies, or representatives, with power of substitution to each, to vote on
your behalf at a meeting of the shareholders of Putnam High Income
Opportunities Trust. The meeting will take place on October 14, 2004 at 11:00
a.m. in Boston and may be adjourned to later times or dates.

Your vote is being solicited on behalf of the Trustees. When you complete and
sign this proxy card, the Trustees will vote on your behalf exactly as you
have indicated. If you simply sign the proxy card, or fail to provide your
voting instructions on a proposal, it will be voted in accordance with the
Trustees' recommendations. The proxies are authorized to vote in their
discretion on any other matter that arises at the meeting or any adjournments
of the meeting. The Trustees recommend that shareholders vote in favor of the
proposal listed on the front of this card.

Please mark votes as in this example. X

This is your PROXY CARD.

Proxy for a meeting of shareholders to be held on October 14, 2004, for
Putnam High Income Opportunities Trust.

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1: 1. Proposal to elect all
nominees. The nominees for Trustees are:

(01) J.A. Baxter (07) P.L. Joskow (11) G. Putnam, III
(02) C.B. Curtis (08) E.T. Kennan (12) A.J.C. Smith
(03) M.R. Drucker (09) J.H. Mullin, III (13) W.T. Stephens
(04) C.E. Haldeman, Jr. (10) R.E. Patterson (14) R.B. Worley
(05) J.A. Hill
(06) R.J. Jackson

FOR WITHHOLD AUTHORITY
ALL TO VOTE FOR
NOMINEES [ ] ALL NOMINEES [ ]

[ ]
----------------------------------------------------------

To withhold authority to vote for any individual nominee(s)
and to vote for all other nominee(s), mark box above and write
on the line next to the box the number(s) of the nominee(s)
for whom you withhold authority to vote

Please be sure to sign and date this proxy card. Please sign your
name exactly as it appears on this card. If you are a joint owner, each
owner should sign. When signing as executor, administrator, attorney,
trustee or guardian, or as custodian for a minor, please give your full
title as such. If you are signing for a corporation, please sign the
full corporate name and indicate the signer's office. If you are a partner,
sign in the partnership name.

- --------------------------------------------------------------
Shareholder/Co-owner sign(s) here Date

Your vote is important. Please vote immediately.

To vote by mail:

* Read the proxy statement.

* Check one of the appropriate
boxes on the reverse side.

* Sign and date the proxy card.

* Return the proxy card in the
envelope provided.

To vote by telephone:

* Read the proxy statement and
have the proxy card at hand.

* Call 1-877-779-8683.

* Follow the automated telephone directions.

* There is no need for you to
return your proxy card.

To vote on the web:

* Read the proxy statement and
have the proxy card at hand.

* Go to
https://www.eproxyvote.com/putnam1

* Follow the instructions on the site.

* There is no need for you to
return your proxy card.

If you vote over the Internet or by telephone, please do not mail your
card.

Proxy card for a meeting of shareholders to be held on October 14, 2004,
for Putnam Managed High Yield Trust.

You, as a Putnam fund shareholder, by signing this proxy card, appoint John
A. Hill and Robert E. Patterson, and each of them separately, as your
proxies, or representatives, with power of substitution to each, to vote on
your behalf at a meeting of the shareholders of Putnam Managed High Yield
Trust. The meeting will take place on October 14, 2004 at 11:00 a.m. in
Boston and may be adjourned to later times or dates.

Please mark votes as in this example. X

This is your PROXY CARD.

Proxy for a meeting of shareholders to be held on October 14, 2004, for
Putnam Managed High Yield Trust.

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1: 1. Proposal to elect all
nominees. The nominees for Trustees are:

FOR WITHHOLD AUTHORITY
ALL TO VOTE FOR
NOMINEES [ ] ALL NOMINEES [ ]

[ ]
----------------------------------------------------------

To withhold authority to vote for any individual nominee(s) and to
vote for all other nominee(s), mark box above and write on the
line next to the box the number(s) of the nominee(s) for whom
you withhold authority to vote

- --------------------------------------------------------------
Shareholder/Co-owner sign(s) here Date

Your vote is important. Please vote immediately.

To vote by mail:

* Read the proxy statement.

* Check one of the appropriate
boxes on the reverse side.

* Sign and date the proxy card.

* Return the proxy card in the
envelope provided.

To vote by telephone:

* Read the proxy statement and
have the proxy card at hand.

* Call 1-877-779-8683.

* Follow the automated telephone directions.

* There is no need for you to
return your proxy card.

To vote on the web:

* Read the proxy statement and
have the proxy card at hand.

* Go to
https://www.eproxyvote.com/putnam1

* Follow the instructions on the site.

* There is no need for you to
return your proxy card.

If you vote over the Internet or by telephone, please do not mail your
card.

Proxy card for a meeting of shareholders to be held on October 14, 2004,
for Putnam Master Income Trust.

You, as a Putnam fund shareholder, by signing this proxy card, appoint John
A. Hill and Robert E. Patterson, and each of them separately, as your
proxies, or representatives, with power of substitution to each, to vote on
your behalf at a meeting of the shareholders of Putnam Master Income Trust.
The meeting will take place on October 14, 2004 at 11:00 a.m. in Boston and
may be adjourned to later times or dates.

Please mark votes as in this example. X

This is your PROXY CARD.

Proxy for a meeting of shareholders to be held on October 14, 2004, for
Putnam Master Income Trust.

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1: 1. Proposal to elect all
nominees. The nominees for Trustees are:

FOR WITHHOLD AUTHORITY
ALL TO VOTE FOR
NOMINEES [ ] ALL NOMINEES [ ]

[ ]
----------------------------------------------------------

To withhold authority to vote for any individual nominee(s) and to
vote for all other nominee(s), mark box above and write on the
line next to the box the number(s) of the nominee(s) for whom
you withhold authority to vote

Please be sure to sign and date this proxy card. Please sign your name
exactly as it appears on this card. If you are a joint owner, each owner
should sign. When signing as executor, administrator, attorney, trustee or
guardian, or as custodian for a minor, please give your full title as such.
If you are signing for a corporation, please sign the full corporate name and
indicate the signer's office. If you are a partner, sign in the partnership
name.

- --------------------------------------------------------------
Shareholder/Co-owner sign(s) here Date

Your vote is important. Please vote immediately.

To vote by mail:

* Read the proxy statement.

* Check one of the appropriate
boxes on the reverse side.

* Sign and date the proxy card.

* Return the proxy card in the
envelope provided.

To vote by telephone:

* Read the proxy statement and
have the proxy card at hand.

* Call 1-877-779-8683.

* Follow the automated telephone directions.

* There is no need for you to
return your proxy card.

To vote on the web:

* Read the proxy statement and
have the proxy card at hand.

* Go to
https://www.eproxyvote.com/putnam1

* Follow the instructions on the site.

* There is no need for you to
return your proxy card.

If you vote over the Internet or by telephone, please do not mail your
card.

Proxy card for a meeting of shareholders to be held on October 14, 2004,
for Putnam Tax-Free Health Care Fund.

You, as a Putnam fund shareholder, by signing this proxy card, appoint John
A. Hill and Robert E. Patterson, and each of them separately, as your
proxies, or representatives, with power of substitution to each, to vote on
your behalf at a meeting of the shareholders of Putnam Tax-Free Health Care
Fund. The meeting will take place on October 14, 2004 at 11:00 a.m. in Boston
and may be adjourned to later times or dates.

Please mark votes as in this example. X

This is your PROXY CARD.

Proxy for a meeting of shareholders to be held on October 14, 2004, for
Putnam Tax-Free Health Care Fund.

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1: 1. Proposal to elect all
nominees. The nominees for Trustees are:

FOR WITHHOLD AUTHORITY
ALL TO VOTE FOR
NOMINEES [ ] ALL NOMINEES [ ]

[ ]
----------------------------------------------------------

To withhold authority to vote for any individual nominee(s) and to
vote for all other nominee(s), mark box above and write on the
line next to the box the number(s) of the nominee(s) for whom
you withhold authority to vote

- --------------------------------------------------------------
Shareholder/Co-owner sign(s) here Date

Putnam Funds Annual Meeting of Shareholders

Putnam High Income Opportunities Trust
Putnam Managed High Yield Trust
Putnam Master Income Trust
Putnam Tax-Free Health Care Fund

Proxy card for a meeting of shareholders to be held on October 14, 2004,
for the Putnam Funds identified above.

You, as a Putnam fund shareholder, by signing this proxy card, appoint John
A. Hill and Robert E. Patterson, and each of them separately, as your
proxies, or representatives, with power of substitution to each, to vote on
your behalf at a meeting of the shareholders. The meeting will take place
on October 14, 2004 at 11:00 a.m. in Boston and may be adjourned to later
times or dates.

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1.

Check this box to cast your vote in accordance with the recommendations [ ]
of the Putnam Funds Board of Trustees:

THE TRUSTEES RECOMMEND A VOTE FOR PROPOSAL 1:

1. Proposal to elect all nominees. The nominees for Trustees are:

[ ] FOR ALL NOMINEES, except as noted below [ ] WITHHOLD AS TO ALL NOMINEES
[ ] J.A. Baxter [ ] C.B. Curtis [ ] M.R. Drucker
[ ] C.E. Haldeman, Jr. [ ] J.A. Hill [ ] R.J. Jackson
[ ] P.L. Joskow [ ] E.T. Kennan [ ] J.H. Mullin, III
[ ] R.E. Patterson [ ] G. Putnam, III [ ] A.J.C. Smith
[ ] W.T. Stephens [ ] R.B. Worley

To cast your vote please click "Submit".
(NOTE: Your vote will not be counted until you click "Submit".)