Securities Act Registration No. 333-______
U.S. Securities and Exchange Commission
Washington, D.C. 20549
----------
Form N-14
Registration Statement Under the Securities Act of 1933
[_] Pre-Effective Amendment No. ____ [_] Post Effective Amendment No. _____
(Check appropriate box or boxes)
----------
John Hancock Variable Series Trust I
(Exact Name of Registrant as Specified in Declaration of Trust)
197 Clarendon Street
Boston, Massachusetts 02117
(Address of Principal Executive Officer)
Registrant's Telephone Number: (713) 214-1456
Name and address of Agent for Services: Copy to:
ARNOLD BERGMAN, ESQUIRE THOMAS C. LAUERMAN, ESQUIRE
John Hancock Life Insurance Company Foley & Lardner LLP
197 Clarendon Street Washington, D.C. 20036
Boston, MA 02117
----------
Approximate Date of Proposed Public Offering: As soon as practicable after the
registration statement becomes effective under the Securities Act of 1933.
Pursuant to Rule 429 under the Act, the prospectus in this registration
statement also relates to the Registrant's currently effective registration
statement on Form N-1A, File No. 33-2081. No filing fee is due in reliance on
Section 24(f) of the Act.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
MANUFACTURERS INVESTMENT TRUST
73 Tremont Street
Boston, Massachusetts 02108
May __, 2004
Dear Variable Annuity and Variable Life Contract Owners:
A Special Meeting of Shareholders of Manufacturers Investment Trust ("MIT")
will be held at 73 Tremont Street, Boston, Massachusetts 02108, on June 18, 2004
at 10:00 a.m., Boston Time to consider the proposed reorganization of the
International Index Trust, a separate series of MIT, into the International
Equity Index Fund, a separate series of the John Hancock Variable Series Trust I
("JHVST") (the "Reorganization"). The proposed Reorganization is described in
detail in the enclosed Proxy Statement/Prospectus and briefly summarized in the
questions and answers attached to this letter.
As a result of the Reorganization, shareholders whose assets are invested
in the International Index Trust will be able to pursue substantially similar
investment objectives and policies in the context of a larger fund which has
shown better prospects for growth and demonstrated stronger performance in
tracking its target indices. The Boards of Trustees of MIT and JHVST have
unanimously approved the proposed Reorganization.
Although you are not a shareholder of MIT, contract values under your
variable annuity or variable life contracts issued by The Manufacturers Life
Insurance Company (U.S.A.) ("Manulife U.S.A.") or The Manufacturers Life
Insurance Company of New York ("Manulife New York") are invested in shares of
one or more of the separate series of MIT, including the International Index
Trust, through subaccounts of separate accounts established by these companies
for that purpose. Since the value of your contract depends in part on the
investment performance of the shares of the International Index Trust, you have
the right to instruct Manulife U.S.A. or Manulife New York, as appropriate, how
such shares attributable to your contract are voted.
Enclosed you will find a Notice of Special Meeting of Shareholders, a Proxy
Statement/Prospectus of MIT and JHVST, and a Voting Instructions Form for the
shares of the International Index Trust attributable to your contract as of
April 20, 2004, the record date for the meeting. We encourage you to read these
materials in their entirety before giving voting instructions. Also enclosed for
additional information is the current prospectus of JHVST. In order for shares
to be voted at the meeting based on your instructions, we urge you to complete
and mail your Voting Instructions Form in the attached postage-paid envelope,
allowing sufficient time for its receipt by June 17, 2004.
The Board of Trustees of MIT unanimously recommends that you approve the
Reorganization.
If you have any questions regarding the proposed Reorganization, please
call the appropriate toll-free number below:
--For Manulife U.S.A. variable annuity contracts: (800) 344-1029
--For Manulife U.S.A. variable life contracts: (800) 827-4546
--For Manulife New York variable annuity contracts: (800) 551-2078
--For Manulife New York variable life contracts: (888) 267-7784
Sincerely,
/s/ ANDREW CORSELLI
Andrew Corselli
Secretary
Manufacturers Investment Trust
Questions and Answers
Q: What is the Reorganization?
A: Under the Reorganization proposal, all the assets, subject to all the
liabilities, of MIT's International Index Trust (the "Acquired Fund") will be
transferred to JHVST's International Equity Index Fund (the "Acquiring Fund") in
exchange for shares of the Acquiring Fund. As a result of the Reorganization,
each shareholder of the Acquired Fund will receive that number of shares of the
Acquiring Fund equal in value at the time of the exchange to the value of the
shareholder's shares of the Acquired Fund at that time, and the Acquired Fund
will be liquidated and terminate. The holders of Series I and Series II shares
of the Acquired Fund will receive, respectively, Series I and Series II shares
of the Acquiring Fund. If approved by shareholders, the Reorganization is
expected to take place after the close of business on June 18, 2004.
Q: What are the reasons for the Reorganization?
A: The Reorganization is intended to provide a means by which contract owners
participating in the Acquired Fund, in combination with the Acquiring Fund, may
pursue substantially similar investment objectives and policies in the context
of a larger fund which has shown better prospects for growth and demonstrated
stronger performance in tracking its target indices.
Q: What differences will there be if the Reorganization is approved?
A: There will be very significant differences. Although both the Acquired and
Acquiring Funds are international index funds and thus have substantially
similar investment objectives, strategies and risks, the Acquiring Fund has a
different target index (the MSCI ACWI ex US Index) than the Acquired Fund (the
MSCI EAFE Index), is a series of JHVST rather than of MIT and has a different
investment adviser, a different subadviser and different portfolio managers than
the Acquired Fund. In addition, the total annual fund operating expenses of the
Acquiring Fund are expected to be somewhat higher than those of the Acquired
Fund.
Q: Will the Reorganization affect my contract value? Will there be any tax
implications?
A: Your contract value will be the same immediately after as immediately before
the Reorganization. In addition, the Reorganization is expected to be tax-free
for federal income tax purposes, and the Funds will obtain an opinion from
counsel to this effect. The Reorganization will not result in individual
contract owners recognizing any gain or loss for federal income tax purposes.
Q: Will I incur any fee in connection with the Reorganization?
A: You will not incur directly any fee in connection with the Reorganization.
However, the expenses of the Reorganization are being paid by the
Acquired Fund and the Acquiring Fund in equal parts, and contract owners
participating in these Funds will therefore bear indirectly their proportionate
shares of such expenses.
Q: How do I give voting instructions?
A: Follow two simple steps:
FIRST: Read the attached Proxy Statement/Prospectus.
SECOND: Complete the enclosed Voting Instruction Form and return it in the
enclosed postage-paid envelope.
Q: Do my voting instructions make a difference?
A: Whether you are a large or small investor, your voting instructions are
important. You are urged to participate in this process to ensure that Manulife
U.S.A. and Manulife New York represent your wishes in casting votes at the
shareholders meeting. The Board of Trustees of MIT has voted unanimously in
favor of the Reorganization, and your approval is needed to implement the
Reorganization.
MANUFACTURERS INVESTMENT TRUST
73 Tremont Street
Boston, Massachusetts 02108
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders of the International Index Trust
of Manufacturers Investment Trust:
Notice is hereby given that a Special Meeting of Shareholders (the
"Meeting") of the International Index Trust of Manufacturers Investment Trust
("MIT") will be held at 73 Tremont Street, Boston, Massachusetts 02108, on June
18, 2004 at 10:00 a.m., Boston Time. A Proxy Statement/Prospectus which provides
information about the purposes of the Meeting is included with this notice. The
Meeting will be held for the following purposes:
Proposal 1 Approval of Agreement and Plan of Reorganization (the "Plan")
providing for the acquisition of all of the assets, subject to all
of the liabilities, of the International Index Trust (the "Acquired
Fund"), a separate series of MIT, by and in exchange for Series I
and Series II shares of the International Equity Index Fund (the
"Acquiring Fund"), a separate series of the John Hancock Variable
Series Trust I ("JHVST").
Any other business that may properly come before the Meeting.
The Board of Trustees of MIT recommends that shareholders vote FOR Proposal
1.
Approval of the Plan under Proposal 1 will require the affirmative vote of
the holders of at least a "Majority of the Outstanding Voting Securities" (as
defined in the accompanying Proxy Statement/Prospectus) of the Acquired Fund.
By approving the Plan, shareholders of the Acquired Fund will be deemed to have
waived certain of MIT's investment limitations insofar as they might be deemed
to apply to the transactions contemplated by the Plan.
Each shareholder of record at the close of business on April 20, 2004 is
entitled to receive notice of and to vote at the Meeting.
Sincerely yours,
/s/ ANDREW CORSELLI
Andrew Corselli
Secretary
May __, 2004
Boston, Massachusetts
MANUFACTURERS INVESTMENT TRUST JOHN HANCOCK VARIABLE SERIES TRUST I
73 Tremont Street 197 Clarendon Street
Boston, Massachusetts 02108 Boston, Massachusetts 02117
("MIT") ("JHVST")
------------------
PROXY STATEMENT/PROSPECTUS
Relating to the Acquisition of All of the Assets, Subject to All of the
Liabilities, of the MIT International Index Trust by and in Exchange for Series
I and Series II Shares of the JHVST International Equity Index Fund
This Proxy Statement/Prospectus is furnished in connection with the
solicitation by the Board of Trustees of Manufacturers Investment Trust ("MIT")
(sometimes referred to herein as the "MIT Board") of proxies to be used at a
special meeting of the shareholders of its International Index Trust to be held
at 73 Tremont Street, Boston, Massachusetts 02108, on June 18, 2004, at 10:00
a.m., Boston Time (the "Meeting").
At the Meeting, shareholders of the International Index Trust will be asked
to consider and approve a proposed Agreement and Plan of Reorganization (the
"Plan") pursuant to which all the assets, subject to all the liabilities, of the
International Index Trust (the "Acquired Fund"), a separate series of MIT, will
be transferred to the International Equity Index Fund (the "Acquiring Fund"), a
separate series of the John Hancock Variable Series Trust I ("JHVST"), in
exchange for shares of the Acquiring Fund. As a result of the Reorganization,
each shareholder of the Acquired Fund will receive that number of shares of the
Acquiring Fund equal in value at the time of the exchange to the value of the
shareholder's shares of the Acquired Fund at such time, and the Acquired Fund
will be liquidated and terminate. The holders of Series I and Series II shares
of the Acquired Fund will receive, respectively, Series I and Series II shares
of the Acquiring Fund. If approved by shareholders of the Acquired Fund, the
Reorganization is expected to occur after the close of business on June 18,
2004. The terms and conditions of the Reorganization are more fully described in
this Proxy Statement/Prospectus and in the form of the Agreement and Plan of
Reorganization attached hereto as Exhibit A.
This Proxy Statement/Prospectus contains information shareholders should
know before voting on the proposed Reorganization. Please read it carefully and
retain it for future reference. The following documents have been filed with the
Securities and Exchange Commission ("SEC") and are incorporated by reference
into this Proxy Statement/Prospectus:
- --The Prospectus of JHVST (relating to the Acquiring A copy of the JHVST Prospectus accompanies this
Fund) dated May 1, 2004 (the "JHVST Prospectus"). Proxy Statement/Prospectus.
- --The Statement of Additional Information of JHVST dated Copies of this document are available at no charge by
May __, 2004 relating to this Proxy Statement/Prospectus writing to JHVST at the above address or by calling
(the "Statement of Additional Information"). this toll free number: 800-576-2227.
- --The Prospectus of MIT (relating to the Acquired Fund) Copies of the MIT Prospectus are available at no
dated May 1, 2004 (the "MIT Prospectus"). charge by writing to MIT at the above address or by
calling the appropriate toll free number listed below.
Shareholders who have questions about the Reorganization or this Proxy
Statement/Prospectus may call the appropriate toll-free number listed below:
--(800) 344-1029 (The Manufacturers Life Insurance Company (U.S.A.)
variable annuity contracts)
--(800) 827-4546 (The Manufacturers Life Insurance Company (U.S.A.)
variable life contracts)
--(800) 551-2078 (The Manufacturers Life Insurance Company of New York
variable annuity contracts)
--(888) 267-7784 (The Manufacturers Life Insurance Company of New York
variable life contracts).
Each of MIT and JHVST is subject to the informational requirements of the
Securities Exchange Act of 1934 and the Investment Company Act of 1940 Act and
files reports, proxy materials and other information with the SEC. Such reports,
proxy materials and other information may be inspected at the public reference
facilities maintained by the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549. Copies of such materials may also be obtained from the Public Reference
Branch, Office of Consumer Affairs and Information Services, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates, or at no charge from the EDGAR database on the SEC's website:
"www.sec.gov."
The SEC has not approved or disapproved these securities or passed upon the
accuracy or adequacy of this Proxy Statement/Prospectus. Any representation to
the contrary is a criminal offense.
The date of this Proxy Statement/Prospectus is May __, 2004.
2
PROXY STATEMENT/PROSPECTUS
TABLE OF CONTENTS
Page
----
Introduction .....................................................................
Proposal 1 Approval of Agreement and Plan of Reorganization providing for the
acquisition of all of the assets, subject to all of the
liabilities, of the MIT International Index Trust by and in
exchange for Series I and Series II shares of the JHVST
International Equity Index Fund .....................................
Summary ..........................................................................
Overview of Proposed Reorganization ..............................................
Comparison of Acquired and Acquiring Funds .......................................
Investment Objectives and Policies ...............................................
Fees and Expenses of the Funds ...................................................
Comparison of Principal Investment Risks .........................................
Performance ......................................................................
Multiple Classes of Shares .......................................................
Rule 12b-1 Fees ..................................................................
Dividends and Distributions ......................................................
Purchase and Redemption of Shares ................................................
Tax Consequences .................................................................
Massachusetts Business Trusts ....................................................
Additional Information About the Funds ...........................................
Information About the Reorganization .............................................
Agreement and Plan of Reorganization .............................................
Reasons for the Reorganization ...................................................
Description of the Securities to be Issued .......................................
Federal Income Tax Consequences ..................................................
Capitalization ...................................................................
Voting Information ...............................................................
Ownership of Shares of the Funds .................................................
Financial Statements .............................................................
Legal Matters ....................................................................
Other Information ................................................................
Exhibit A -- Form of Agreement and Plan of Reorganization ......................
Appendix A -- The Acquired Fund: Management's Discussion of
Fund Performance ..................................................
Appendix B -- The Acquiring Fund: Management's Discussion of
Fund Performance ..................................................
3
INTRODUCTION
This Proxy Statement/Prospectus is furnished in connection with the
solicitation by the Board of Trustees of MIT of proxies to be used at a special
meeting of shareholders of its International Index Trust to be held at 73
Tremont Street, Boston, Massachusetts 02108, on June 18, 2004, at 10:00 a.m.,
Boston Time (the "Meeting"). The purpose of the Meeting is to consider the
proposed Reorganization providing for the transfer of all the assets, subject to
all the liabilities, of MIT's International Index Trust (the "Acquired Fund") to
JHVST's International Equity Index Fund (the "Acquiring Fund") in exchange for
Series I and Series II shares of the Acquiring Fund. All shareholders of record
of the Acquired Fund at the close of business on April 20, 2004 (the "Record
Date") are entitled to one vote for each share of beneficial interest of the
Acquired Fund held.
MIT and JHVST. Each of MIT and JHVST is a Massachusetts business trust
which is a no-load open-end investment company, commonly known as a mutual fund,
registered under the Investment Company Act of 1940, as amended (the "1940
Act"). MIT currently offers __ separate series, including the Acquired Fund (the
"MIT Funds"), and JHVST currently offers 30 separate series, including the
Acquiring Fund (the "JHVST Funds"). The shares of the MIT Funds and the JHVST
Funds are not sold directly to the public but generally only to insurance
companies and their separate accounts as the underlying investment media for
variable annuity and variable life insurance contracts ("variable contracts")
issued by the insurance companies, certain entities affiliated with the
insurance companies, and trustees of qualified pension and retirement plans. See
"Voting Information" and "Ownership of Shares of the Funds" below.
Investment Management. Manufacturers Securities Services, LLC ("MSS")
serves as investment adviser for MIT and for each MIT Fund that has an adviser.
As adviser, MSS administers the business and affairs of MIT and selects,
contracts with and compensates subadvisers which manage the investment and
reinvestment of the assets of the MIT Funds. MSS does not itself manage any of
MIT's portfolio assets but has ultimate responsibility to oversee the
subadvisers. In this connection, MSS (i) monitors the compliance of the
subadvisers with the investment objectives and related policies of the MIT
Funds, (ii) reviews the performance of the subadvisers and (iii) reports
periodically on such performance to the MIT Board. The ultimate parent of MSS is
Manulife Financial Corporation ("MFC"), the holding company of The Manufacturers
Life Insurance Company ("Manulife"), a Canadian stock life insurance company,
and its subsidiaries, collectively known as Manulife Financial.
The investment adviser for the JHVST Funds is John Hancock Life
Insurance Company ("JHLICO"). In this capacity, JHLICO recommends subadvisers
for the JHVST Funds and oversees and evaluates the subadvisers performance. Each
subadviser has discretion to purchase and sell securities for the JHVST Fund
that it manages. While each subadviser employs its own investment approach in
managing a JHVST Fund, it must also adhere to the Fund's investment goals,
strategies and restrictions. JHLICO is a wholly owned subsidiary of John Hancock
Financial Services, Inc. ("John Hancock"). As the result of a merger between
John Hancock and MFC that became effective on April __, 2004, John Hancock is a
wholly owned subsidiary of MFC.
MSS and JHLICO are registered as investment advisers under the
Investment Advisers Act of 1940 (the "Advisers Act"). Each of the subadvisers to
the MIT Funds and the JHVST Funds is also registered as an investment adviser
under the Advisers Act or is exempt from such registration.
PROPOSAL 1
APPROVAL OF AGREEMENT AND PLAN OF REORGANIZATION PROVIDING FOR
THE ACQUISITION OF ALL OF THE ASSETS, SUBJECT TO ALL OF THE LIABILITIES,
OF THE MIT INTERNATIONAL INDEX TRUST BY AND IN EXCHANGE FOR SERIES I AND
SERIES II SHARES OF THE JHVST INTERNATIONAL EQUITY INDEX FUND
SUMMARY
The following is a summary of more complete information appearing later
in or incorporated by reference into this Proxy Statement/Prospectus.
Shareholders should read the entire Proxy Statement/Prospectus carefully.
4
Overview of Proposed Reorganization
At its meeting held on April 1-2, 2004, the MIT Board, including all
the Trustees who are not "interested persons" (as defined in the 1940 Act) of
MIT (the "Independent Trustees"), approved an Agreement and Plan of
Reorganization (the "Plan") providing for: (a) the transfer of all of the
assets, subject to all of the liabilities, of the MIT International Index Trust
(the "Acquired Fund") to the JHVST International Equity Index Fund (the
"Acquiring Fund") in exchange for Series I and Series II shares of the Acquiring
Fund; (b) the distribution to shareholders of the Acquired Fund of such
Acquiring Fund shares; and (c) the liquidation and termination of the Acquired
Fund (the "Reorganization").
As a result of the Reorganization, each shareholder of the Acquired
Fund will become a shareholder of the Acquiring Fund. The total value of all
shares of the Acquiring Fund issued in the Reorganization will equal the total
value of the net assets of the Acquired Fund. The number of full and fractional
shares of the Acquiring Fund received by a shareholder of the Acquired Fund will
be equal in value to the value of that shareholder's shares of the Acquired Fund
as of the close of regularly scheduled trading on the New York Stock Exchange on
the closing date of the Reorganization (the "Exchange Date"). Holders of Series
I and Series II shares of the Acquired Fund will receive, respectively, Series I
and Series II shares of the Acquiring Fund. The Effective Time of the
Reorganization is expected to occur after the close of business on June 18, 2004
or on such later date as may be determined by MIT and JHVST.
The consummation of the Reorganization is contingent on the
satisfaction of the conditions described below under "Information About the
Reorganization -- The Agreement and Plan of Reorganization."
Comparison of Acquired and Acquiring Funds
- ---------------------------------------------------------------------------------------------------------------
MIT International Index Trust JHVST International Equity Index Fund
(Acquired Fund) (Acquiring Fund)
- ---------------------------------------------------------------------------------------------------------------
Business A separate series of MIT. A separate series of JHVST.
- ---------------------------------------------------------------------------------------------------------------
Approximate $99,376,000.* $159,036,000.
Net Assets
as of 12/31/03: *Includes "seed capital" expected to be
withdrawn prior to the Reorganization.
See "Capitalization" below.
- ---------------------------------------------------------------------------------------------------------------
Investment Manufacturers Securities Services, LLC John Hancock Life Insurance Company
Adviser: ("MSS"). ("JHLICO").
- ---------------------------------------------------------------------------------------------------------------
Investment MFC Global Investment Management (U.S.A.) SSgA Funds Management, Inc. ("SSgA"). SSgA
Subadviser and Limited ("MFC Global"). MFC Global is an became the subadviser to the Acquiring Fund
Portfolio affiliate of MSS and JHLICO. effective March 29, 2004.
Managers:
The portfolio managers are: The SsgA portfolio management is overseen by:
Carson Jen (since January 2003) Jeffery Beach (since March 2004)
--Assistant Vice President of MFC Global --Principal of SSgA
--Joined MFC Global in 1997 --Joined SSgA in 1986
Narayan Ramani, CFA (since November 2003) James Francis, CFA (since March 2004)
--Joined MFC Global in 1998 --Principal of SSgA
--Joined SSgA in 1987
- ---------------------------------------------------------------------------------------------------------------
Investment Seeks to approximate the aggregate total Seeks to track the performance of a
Objective: return of a foreign equity market index. broad-based equity index of foreign
companies in developed and emerging markets.
- ---------------------------------------------------------------------------------------------------------------
Principal Invests under normal market conditions at Normally invests more than 80% of its
Investment least 80% of its net assets (plus any assets in securities listed in the Morgan
Strategy: borrowings for investment purposes) in Stanley Capital International All Country
(a) the common stocks that are included World Excluding U.S. ("MSCI ACWI ex US")
in the Morgan Stanley Capital Index. Prior to November 1, 2003, the
International Europe, Australia, Far East Fund normally invested more than 80% of its
("MSCI EAFE") Index and (b) securities assets in securities listed in the MSCI
(which may or may not be included in the EAFE GDP Index, and was managed relative to
MSCI EAFE Index) that the subadviser a composite of 90% MSCI EAFE GDP Index and
believes as a group will behave in a 10% MSCI Emerging Markets Free ("MSCI EMF")
manner similar to the index. Index.
- ---------------------------------------------------------------------------------------------------------------
5
- ---------------------------------------------------------------------------------------------------------------
International Europe, Australia, Far East 2003, the Fund normally invested more than
("MSCI EAFE") Index and (b) securities 80% of its assets in securities listed in the
(which may or may not be included in the MSCI EAFE GDP Index, and was managed relative
MSCI EAFE Index) that the subadviser to a composite of 90% MSCI EAFE GDP Index and
believes as a group will behave in a 10% MSCI Emerging Markets Free ("MSCI EMF")
manner similar to the index. Index.
- ---------------------------------------------------------------------------------------------------------------
Other An index is an unmanaged group of The Fund is managed relative to the MSCI
Investment securities whose overall performance is ACWF ex US Index, which includes companies
Strategies: used as an investment benchmark. The representative of the market structure of
subadviser attempts to match the developed and emerging market countries in
performance of the MSCI EAFE Index by the Americas (excluding the U.S.),
holding all or a representative sample of Europe/Middle East and Asia/Pacific
the securities that comprise the index or Regions. Country index weights are based
by holding securities (which may or may upon a country's market capitalization.
not be included in the index) that the
subadviser believes as a group will The subadviser employs a passive management
behave in a manner similar to the index. strategy using quantitative techniques to
The MSCI EAFE Index includes companies replicate, as closely as possible, the
representative of the market structure of characteristics of the index, including
developed countries in the Europe and country and sector weights. The
Pacific Regions. composition of the index changes from time
to time, and the subadviser reflects those
changes as soon as practical.
- ---------------------------------------------------------------------------------------------------------------
Hedging and For hedging purposes, the Fund is The Fund is normally fully invested. The
Other Strategies: authorized to invest in futures contracts. subadviser may invest in stock index
derivatives to maintain market exposure and
manage cash flow. Although the Fund may
employ foreign currency hedging techniques,
it normally maintains the currency exposure
of the underlying equity investments.
- ---------------------------------------------------------------------------------------------------------------
Other Securities of foreign issuers in which The Fund may invest in other types of
Securities: the Fund may invest include American securities that are not primary investment
Depositary Receipts (ADRs), Global vehicles, for example: ADRs, GDRs, EDRs,
Depositary Receipts (GDRs) and European certain Exchange Traded Funds (EFTs), cash
Depositary Receipts (EDRs). Depositary equivalents and certain derivatives such as
receipts are certificates, typically stock index futures.
issued by a bank or trust company, that
give their holders the right to receive
securities issued by a foreign or
domestic company.
- ---------------------------------------------------------------------------------------------------------------
Temporary In abnormal market conditions, the Fund In abnormal market conditions, the Fund may
Defensive may invest all or a portion of its assets take temporary defensive measures - such as
Investing: in cash and securities that are highly holding large amounts of cash and cash
liquid, including (a) money market equivalents - that are inconsistent with
instruments such as short-term U.S. the Fund's primary investment strategy. In
government obligations, commercial paper taking those measures, the Fund may not
and repurchase agreements; and (b) achieve its investment goal.
securities of other investment companies
that are money market funds. To the
extent the Fund is in a defensive
position, its ability to achieve its
investment objective will be limited.
- ---------------------------------------------------------------------------------------------------------------
Investment Objectives and Policies
The investment objectives, policies and risks of the Acquired and
Acquiring Funds are substantially similar. Both Funds are index funds, which,
unlike actively managed funds, seek to mirror the performance their target
indices, and both Funds are international index funds which invest principally
in foreign equity securities. The two Funds differ in that they have different
target indices. The MSCI EAFE Index, which is the target index for the Acquired
Fund, includes companies in the developed Europe and Pacific Regions, while the
broader target index for the Acquiring Fund, the MSCI ACWI ex US Index, includes
primarily companies in the developed Europe and Pacific Regions and, to a lesser
extent, companies in developing countries. In addition, while the Acquiring Fund
will normally invest 80% of its assets in companies which are included in its
target index, the Acquired Fund, with respect to the same portion of its assets,
may invest in companies which are not included in its target index but which its
subadviser believes as a group will behave in a manner similar to that index. In
other words, the Acquired
6
Fund may seek to approximate the aggregate total return of its target index
through investments in companies that are not included in that index.
The investment objectives and strategies of the Acquired Fund and the
Acquiring Fund are more fully described in, respectively, the MIT Prospectus and
the JHVST Prospectus, which are incorporated herein by reference. See
"Additional Information About the Funds" below.
For a comparison of the principal risks of investing in the Acquired
and Acquiring Funds, see "Comparison of Principal Investment Risks" below.
Fees and Expenses of the Funds
The table which follows sets forth: (i) the ratios of expenses to
average net assets of the Series I and Series II shares of the Acquired Fund for
the year ended December 31, 2003, (ii) the estimated expenses for the current
year of the Series I and Series II shares of the Acquiring Fund, which were
first offered on May 1, 2004, and (iii) the pro forma expense ratios of the
Series I and Series II shares of the Acquiring Fund assuming that the
Reorganization, including the issuance of Series I and Series II shares in
connection therewith, had occurred at the commencement of the year ended
December 31, 2003, and based upon the fee arrangements that will be in place
upon the consummation of the Reorganization. As shown below, giving effect to
the voluntary expense reimbursement described in note A to the table, the
expense ratios of the Acquiring Fund are expected to be 0.02% higher than those
of the Acquired Fund. Accordingly, shareholder approval of the Reorganization is
expected to result in somewhat higher expenses for shareholders after the
Reorganization. The expense ratios below and the expense examples which follow
do not reflect the fees and expenses of any variable contract that may use MIT
or JHVST as its underlying investment medium. If such fees and expenses were
reflected, the expense ratios and shareholder expenses figures would be higher.
Annual Fund Operating Expenses
(As a Percentage of Average Daily Net Assets)
MIT International JHVST International JHVST International
Index Trust Equity Index Fund Equity Index Fund
(Acquired Fund) (Acquiring Fund) (Acquiring Fund)
(Estimated Expenses Pro Forma
for the Current Year) (Assuming Reorganization)
Series I Series II Series I Series II Series I Series II
Management Fee 0.40% 0.40% 0.17% 0.17% 0.16% 0.16%
Distribution and Service 0.15% 0.35% 0.40% 0.60% 0.40% 0.60%
(12b-1) Fee
Other Expenses 0.07% /A/ 0.07% /A/ 0.05% /B/ 0.05% /B/ 0.06% /C/ 0.06% /C/
---- ---- ---- ---- ---- ----
Total Fund Annual 0.62% /A/ 0.82% /A/ 0.62% 0.82% 0.62% 0.82%
Expenses
- ----------------------
/A/ MSS has voluntarily agreed to pay expenses of the Acquired Fund (excluding
management fees and 12b-1 fees) that exceed 0.05%. If such expense reimbursement
were reflected in the table, "Other Expenses" for both Series I shares and
Series II shares would be 0.05%, and "Total Fund Annual Expenses" for Series I
shares and Series II shares would be, respectively, 0.60% and 0.80%. This
expense reimbursement may be terminated by MSS at any time.
/B/ Other Expenses are based on estimated amounts for the current year. These
estimated expenses reflect (i) the discontinuance of JHLICO's agreement to
reimburse the Acquiring Fund for "other expenses" in 2003 that exceeded 0.10% of
the Fund's average daily net assets and (ii) a reduction amounting to 0.20% in
the custodial fees of the Acquiring Fund that became effective April 1, 2004.
/C/ Other Expenses reflect the discontinuance of JHLICO's expense reimbursement
and the reduction in custodial fees described in note /B/.
7
Examples: The following examples are intended to help shareholders compare the
costs of investing in the Series I and Series II shares of the Acquired and
Acquiring Funds. The example assumes that a shareholder invests $10,000 in the
particular Fund for the time periods indicated and redeems all of the shares at
the end of those periods. The example also assumes that a shareholder's
investment has a 5% return each year and that each Fund's operating expense
levels remain the same as those set forth in the expense table above.
MIT International JHVST International JHVST International
Index Trust Equity Index Fund Equity Index Fund
(Acquired Fund) (Acquiring Fund) (Acquiring Fund)
(Estimated Expenses for Pro Forma
the Current Year) (Assuming Reorganization)
Series I Series II Series I Series II Series I Series II
-------- --------- -------- --------- -------- ---------
One Year $ 63 $ 84 $ 63 $ 84 $ 63 $ 84
Three Years $199 $ 262 $199 $ 262 $199 $ 262
Five Years $346 $ 455 $346 $ 455 $346 $ 455
Ten Years $774 $1,014 $774 $1,014 $774 $1,014
The examples assumes reinvestment of all dividends and distributions. The
examples should not be considered a representation of future expenses of the
Acquired or Acquiring Fund. Actual expenses may be greater or less than those
shown. There can be no assurance that the foregoing pro forma expense ratios
would have been the actual expense ratios for the Acquiring Fund had the
Reorganization been consummated when assumed above, or that the pro forma
expense ratios reflect the actual expense ratios that will be incurred by the
Acquiring Fund if the Reorganization is consummated. The purpose of these tables
is to assist shareholders in understanding the expenses an investor in the Funds
will bear.
Investment Management Fees
Investment management fees as a percentage of average daily net assets.
MIT International Index Trust
(Acquired Fund) 0.40% on all assets.
JHVST International Equity Index Fund 0.18% on the first $100 million;
(Acquiring Fund) 0.15% on the next $100 million; and
0.11% on excess over $200 million.
MFC Global Investment Management (U.S.A.) Limited ("MFC Global") serves
as the subadviser to the Acquired Fund and is responsible for managing the
investment and reinvestment of the assets of the Acquired Fund. MFC Global
formulates a continuous investment program for the Acquired Fund consistent with
its investment objective and policies and implements the program by purchases
and sales of securities. As compensation for its services, MFC Global receives a
fee from MSS stated as an annual percentage of the current value of the net
assets of the Acquired Fund. This fee is paid by MSS out of the management fee
it receives for the Acquired Fund and is not an additional charge to the
Acquired Fund. MFC Global is an indirect, wholly-owned subsidiary of MFC.
SSgA Funds Management, Inc. ("SSgA") serves as the subadviser to the
Acquiring Fund and has primary responsibility for making investment decisions
for the Acquiring Fund's investment portfolios and placing orders with brokers
and dealers to implement those decisions. SSgA receives compensation for these
services from JHLICO, and the Acquiring Fund pays no sub-management fees over
and above the management fees it pays to JHLICO. SSgA succeeded Independence
Investments LLC as subadviser to the Acquiring Fund effective March 29, 2004.
SSgA is a wholly-owned subsidiary of State Street Corporation, a publicly held
bank holding corporation.
Comparison of Principal Investment Risks
In deciding whether to approve the Reorganization, you should consider
the amount and character of investment risk involved in the respective
investment objective and strategies of the Acquiring and Acquired Funds. Since
both Funds are international index funds, they have substantially similar risks.
These are described below, with certain differences noted.
8
- -----------------------------------------------------------------------------------------------------------
MIT INTERNATIONAL INDEX TRUST JHVST INTERNATIONAL EQUITY INDEX FUND
(ACQUIRED FUND) (ACQUIRING FUND)
- -----------------------------------------------------------------------------------------------------------
RISKS OF The Funds invest in foreign securities, which pose special risks due to: limited
INVESTING IN government regulation (including less stringent investor protection and disclosure
FOREIGN standards), lack of public information, exposure to possible economic, political and
SECURITIES social instability,foreign currency rate fluctuations, and possible nationalization of a
company's assets. Factors such as lack of liquidity, foreign ownership limits and
restrictions on removing currency also pose special risks, and there may be problems, such
as delays, associated with the settlement of securities transactions. All foreign
securities have some degree of foreign risk. However, to the extent the Funds invest in
emerging market countries, they will have a significantly higher degree of foreign risk
than if they invested exclusively in developed or newly-industrialized countries.
- -----------------------------------------------------------------------------------------------------------
The Fund's target index includes The Fund's target index includes companies
companies representative of the market representative of the market structure of
structure of developed countries in the developed and emerging market countries in
Europe and Pacific Regions. the Americas (excluding the U.S.),
Europe/Middle East and Asia/Pacific Regions.
Because emerging markets are included, the
Fund may have greater exposure to the risks
of investing in such markets.
- -----------------------------------------------------------------------------------------------------------
INDEX The Funds will reflect the performance of their target indices, even when the target
MANAGEMENT indices do not perform well. In addition, fund transaction expenses, and the size and
RISK timing of cash flows, may result in performance being different than that of the target
index.
- -----------------------------------------------------------------------------------------------------------
The subadviser's selection of The subadviser's selection of securities may
securities both inside and outside the not be fully representative of the Fund's
target index may cause the Fund's target index from time to time, particularly
portfolio to track its target index less when the composition of the index changes.
closely.
- -----------------------------------------------------------------------------------------------------------
STOCK The value of the Funds' portfolio securities may go down in response to overall stock
MARKET or bond market movements. Markets tend to move in cycles, with periods of rising prices
RISK: and periods of falling prices. The value of equity securities purchased by the Funds could
decline if the financial condition of the companies the Funds invest in decline or if
overall market and economic conditions deteriorate.
- -----------------------------------------------------------------------------------------------------------
INDEX The subadvisers and their strategies may fail to produce the intended results. Each Fund
SUBADVISER could underperform its peers or lose money if its subadviser's investment strategy does
RISK: not perform as expected.
- -----------------------------------------------------------------------------------------------------------
The subadviser may be incorrect in
selecting for investment companies that
are not included in but that the
subadviser believes as a group will
behave in a manner similar to the target
index.
- -----------------------------------------------------------------------------------------------------------
OTHER A Fund's use of derivative instruments (such as futures contracts in the case of the
RISKS: Acquired Fund and options, futures and swaps in the case of the Acquiring Fund) can
produce disproportionate gains or losses. Derivatives are generally considered more risky
than direct investments. Also, in a down market, derivatives could become harder to value
or sell at a fair price.
- -----------------------------------------------------------------------------------------------------------
The risks of investing in the Acquiring Fund are more fully described
in the JHVST Prospectus and the Statement of Additional Information, which are
incorporated herein by reference. The risks of investing in the Acquired Fund
are more fully described in the MIT Prospectus, which is also incorporated
herein by reference. See "Additional Information About the Funds," below.
PERFORMANCE
The following table sets forth, for the one-year period ended December
31, 2003 and the other periods indicated: (i) the annualized total return of the
Series I and Series II shares of the Acquired Fund; (ii) the annualized total
return of the NAV shares of the Acquiring Fund; and (iii) the pro forma
annualized return for Series I and Series II shares of the Acquiring Fund,
assuming that the Acquiring Fund, which commenced offering Series I and Series
II on May 1, 2004 and will issue such shares in connection with the
Reorganization, had shares of such classes outstanding during 2003 and the other
periods indicated with the same fee arrangements that will be in place
9
upon the consummation of the Reorganization. The performance information in the
table does not reflect fees and expenses of any variable contract which may use
MIT or JHVST as its underlying investment medium. If such fees and expenses had
been reflected, performance would be lower. The performance of each of the Funds
in relation to its target index or indices is further discussed below in,
respectively, Appendices A and B ("The Acquired Fund/The Acquiring Fund:
Management's Discussion of Fund Performance") to this Proxy Statement/
Prospectus.
ONE FIVE TEN LIFE OF DATE FIRST
FUND YEAR YEARS YEARS FUND AVAILABLE
- ---- ---- ----- ----- ---- ---------
MIT International Index Trust --Series I 32.18% NA NA (7.00%) 5/01/2000
(Acquired Fund) --Series II /A//B/ 32.12% NA NA 7.25% 1/28/2002
JHVST International Equity Index Fund /C/ --NAV 41.99% 0.74% 2.80% 5.58% 5/02/1988
(Acquiring Fund) (Pro forma) --Series I 41.59% 0.34% 2.40% 5.18% 5/01/2004
(Pro forma) --Series II/B/ 41.39% 0.14% 2.20% 4.98% 5/01/2004
- --------------------
/A/ Series II shares of the Acquired Fund were first offered January 28, 2002.
/B/ For both the Acquired and Acquiring Funds, Series II performance will be
lower than Series I performance due to a higher 12b-1 fee.
/C/ From May 1998 through March 28, 2004, the subadviser to the Acquiring Fund
was Independence Investment LLC. On November 1, 2003, the Acquiring Fund's
benchmark was changed from a composite of 90% MSCI EAFE Index, a primarily GDP
weighted index, and 10% MSCI EMF Index, to a market capitalization weighted
index, the Morgan Stanley Capital International All Country World Free
Excluding U.S. Index. Subsequently, that index's name was changed to The
Morgan Stanley Capital International All Country Excluding U.S. ("MSCI ACWI
ex US") Index.
MULTIPLE CLASSES OF SHARES
MIT is authorized to issue three classes of shares for the Acquired
Fund and the other MIT Funds: Series I shares (formerly referred to as Class A
shares), Series II shares (formerly referred to as Class B shares) and Series
III shares. Series I, Series II and Series III shares are the same except for
differences in class expenses, including different Rule 12b-1 fees, and voting
rights. See "Rule 12b-1 Fees" below. The Acquired Fund currently has outstanding
only Series I and Series II shares.
JHVST is authorized to issue three classes of shares for the Acquiring
Fund: NAV shares, Series I shares and Series II shares. NAV shares, Series I
shares and Series II shares are the same except for differences in class
expenses, including 12b-1 fees for the Series I and Series II shares, and voting
rights. See "Rule 12b-1 Fees" below. The Acquiring Fund commenced offering
Series I and Series II shares on May 1, 2004 and will issue shares of such
classes in connection with the Reorganization.
All shares of each of the Acquired Fund and the Acquiring Fund have
equal voting rights and are voted in the aggregate, and not by class, except
that shares of each class have exclusive voting rights on any matter submitted
to shareholders that relates solely to the arrangement of that class and have
separate voting rights when any matter is submitted to shareholders in which the
interests of one class differ from the interests of any other class or when
voting by class is otherwise required by law.
RULE 12B-1 FEES
Each of MIT and JHVST has adopted a Distribution Plan under Rule 12b-1
under the 1940 Act (each, a "12b-1 Plan") for the Series I and Series II shares
of, respectively, the Acquired Fund and the Acquiring Fund. As described below,
the Rule 12b-1 fees for the Acquiring Fund are higher than those for the
Acquired Fund. Accordingly, if shareholders of the Acquired Fund approve the
Reorganization, they will incur higher 12b-1 fees following the Reorganization.
With respect to the Acquired Fund: Series I shares are subject to a
Rule 12b-1 fee of up to .15% of Series I share average daily net assets, and
Series II shares are subject to a Rule 12b-1 fee of up to .35% of Series II
share average daily net assets.
With respect to the Acquiring Fund: Series I shares are subject to a
Rule 12b-1 fee of up to .40% of Series I share average daily net assets, and
Series II shares are subject to a Rule 12b-1 fee of up to .60% of Series II
share average daily net assets.
10
Under both the MIT and JHVST 12b-1 Plans, the Rule 12b-1 fees are paid to
Manufacturers Financial Securities, LLC (the "Distributor"), which serves as the
distributor both of shares of the MIT Funds, including the Acquired Fund, and of
the Series I and Series II shares of the Acquiring Fund. To the extent
consistent with applicable laws, regulations and rules, the Distributor may,
under both 12b-1 Plans, use Rule 12b-1 fees: (i) for any expenses relating to
the distribution of the shares of the class; (ii) for any expenses relating to
shareholder or administrative services for holders of the shares of the class
(or owners of variable contracts funded in insurance company separate accounts
that invest in the shares of the class) and (iii) for the payment of "service
fees" that come within Rule 2830(d)(5) of the Conduct Rules of the National
Association of Securities Dealers, Inc. ("NASD"). Without limiting the
foregoing, the Distributor may pay all or part of the Rule 12b-1 fees from a
Fund to one or more affiliated and unaffiliated insurance companies that have
issued variable insurance contracts for which the Fund serves as an investment
vehicle as compensation for providing some or all of the types of services
described in the preceding sentence; this provision, however, does not obligate
the Distributor to make any payments of Rule 12b-1 fees and does not limit the
use that the Distributor may make of the Rule 12b-1 fees it receives. Currently,
all such payments relating to Series I and Series II shares of the Acquired Fund
and the Acquiring Fund are made to insurance companies affiliated with MSS and
the Distributor. However, payments may be made to unaffiliated insurance
companies in the future.
The JHVST 12b-1 Plan provides that if only part of any of the above-listed
activities or expenses (or of any other expenses or activities) is intended to
result in sales of (or services to) a class of the Acquiring Fund's shares, the
Distributor may make a reasonable apportionment thereof, so as to apply Rule
12b-1 fees borne by that class to the portion of such activities or expenses
that pertains to the distribution of (or services to) that class.
Rule 12b-1 fees are paid out of a Fund's assets on an ongoing basis.
Therefore, these fees will increase the cost of an investment in a Fund and may,
over time, be greater than other types of sales charges.
DIVIDENDS AND DISTRIBUTIONS
The dividends and distributions procedures with respect to the Acquired and
Acquiring Funds are substantially similar. MIT and JHVST declare as dividends
substantially all of the net investment income, if any, of, the respective
Funds. Dividends from the net investment income and the net capital gain, if
any, for the Acquired Fund are declared by MIT not less frequently than annually
and reinvested in additional full and fractional shares of the Acquired Fund at
net asset value or paid in cash. JHVST declares and pays dividends monthly and
declares capital gains distributions annually. JHVST automatically reinvests
such dividends and distributions in additional full and fractional shares of the
Acquiring Fund at net asset value.
PURCHASE AND REDEMPTION OF SHARES
The purchase and redemption procedures with respect to shares of the
Acquired and Acquiring Funds are substantially the same. Series I and Series II
shares of both Funds are offered continuously, without sales charge, and are
sold and redeemed at their net asset value next computed after a purchase
payment or redemption request is received from a contract owner. Depending upon
the net asset value at that time, the amount paid upon redemption may be more or
less than the cost of the shares redeemed. Payment for shares redeemed will
generally be made within seven days. However, both MIT and JHVST may suspend the
right of redemption or postpone the date of payment beyond seven days under
certain circumstances as permitted by applicable law and regulations.
Redemptions are normally made in cash, but JHVST reserves the right, at its
discretion, to make full or partial payment by assignment to the appropriate
separate account of portfolio securities at their value used in determining the
redemption price. In such cases, the separate account would incur brokerage
costs should it wish to liquidate these portfolio securities.
Calculation of Net Asset Value. The net asset values of the shares of the
Acquired and Acquiring Funds are determined once daily as of the close of the
regular trading session of the New York Stock Exchange (the "Exchange") on each
business day of the Funds. The Exchange generally closes at 4:00 p.m. Eastern
Time.
The net asset value per share of each share class of each Fund is computed
by: (i) adding the sum of the
11
value of the portfolio securities held by the Fund, plus any cash or other
assets it holds, attributable to the class, (ii) subtracting all its liabilities
attributable to the class, and (iii) dividing the result by the total number of
shares outstanding of the class at such time.
Securities held by each of the Funds, except money market instruments with
remaining maturities of 60 days or less which are valued on an amortized cost
basis, are valued at their market value if market quotations are readily
available. Otherwise, such securities are valued at fair value as determined in
good faith by the MIT Board or its designee, in the case of the Acquired Fund,
or by or under the direction of the Board of Trustees of JHVST (sometimes
referred to herein as the "JHVST Board") in the case of the Acquiring Fund.
Generally, with respect to the Acquired Fund, trading (i) in non-U.S.
securities, (ii) U.S. Government Securities and (iii) money market instruments
is substantially completed each day at various times prior to the close of
regular trading of the Exchange. The values of such securities used in computing
the net asset value of the Acquired Fund's shares are generally determined as of
such times. Occasionally, events which affect the values of such securities may
occur between the times at which they are generally determined and the close of
the Exchange and would therefore not be reflected in the computation of the
Fund's net asset value. In such event, these securities will then be valued at
their fair value as determined in good faith by the MIT's Board or its designee.
With respect to the Acquiring Fund, trading in securities on European
and Far Eastern securities exchanges and over-the-counter markets is normally
completed at various times before the close of business on each day on which the
Exchange is open. The values of such securities used in computing net asset
value per share are normally determined as of such times. Trading of these
securities may not take place on every Exchange business day and may take place
on days which are not business days in New York. JHVST calculates net asset
value per share as of the close of regular trading on the Exchange on each day
on which that exchange is open. Therefore, such calculation does not take place
contemporaneously with the determination of the prices of many of the Acquiring
Funds' securities used in such calculation. If events affecting the value of
such securities occur between the time when their price is determined and the
time as of which the Acquiring Fund's net asset value is calculated, such
securities may be valued at fair value by or under the direction of the JHVST
Board.
TAX CONSEQUENCES
No gain or loss will be recognized by the Acquired Fund or the Acquiring
Fund, or by shareholders of the Acquired Fund, for federal income tax purposes
as a result of the Reorganization. For further information about the tax
consequences of the Reorganization, see "Information About the Reorganization --
Federal Income Tax Consequences," below.
MASSACHUSETTS BUSINESS TRUSTS
As stated above, each of MIT and JHVST is a Massachusetts business trust.
As such, each is governed by the terms of its Declaration of Trust. Shareholders
of MIT and JHVST have substantially similar voting and other rights. Neither MIT
nor JHVST is required to hold an annual meeting of shareholders.
Under Massachusetts law, shareholders of MIT and JHVST could, under certain
circumstances, be held personally liable for the obligations of these respective
business trusts. However, the Declarations of Trust of MIT and JHVST contain
express disclaimers of shareholder liability for acts or obligations of the
business trusts and require that notices of such disclaimers be given in each
agreement, obligation, or instrument entered into or executed by the Trustees or
any officers of the business trusts. The Declarations of Trust also provide for
indemnification, out of the property of JHVST in the case of JHVST and out of
the property of a particular MIT Fund in the case of MIT, for all losses and
expenses of any shareholder held personally liable for the obligations of,
respectively, JHVST or such MIT Fund. Both MIT and JHVST consider the risk of a
shareholder incurring financial loss on account of shareholder liability to be
remote.
ADDITIONAL INFORMATION ABOUT THE FUNDS
The following table shows where in the MIT Prospectus and the JHVST
Prospectus additional information about, respectively, the Acquired Fund and the
Acquiring Fund may be found.
12
TYPE OF INFORMATION HEADING OR CAPTION IN PROSPECTUS
MIT PROSPECTUS JHVST PROSPECTUS
-------------- ----------------
Investment Objective Investment Objective; Investment Goal and Strategy.
and Policies: Strategies; Additional Investment
Policies; Hedging and Other Strategic
Transactions.
Portfolio Subadviser and Portfolio Managers; Subadviser; Fund Managers.
Management: Advisory Arrangements; Subadvisory
Arrangements.
Expenses: Fees and Expenses for Each Portfolio. Fees and Expenses of the Fund.
Risks: Principal Risks; Risks of Investing Main Risks.
in Certain Types of Securities.
Taxes: Taxes. Dividends and Taxes.
Dividends and Dividends. Dividends and Taxes.
Distributions:
Purchase and Redemption Purchase and Redemption of Shares. Investment in Shares of the
of Shares: Funds; Share Price.
Financial Highlights: Financial Highlights. Financial Highlights.
INFORMATION ABOUT THE REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION
The following summary of the Plan is qualified in its entirety by reference
to the form of the Plan attached hereto as Exhibit A. The Plan provides that the
Acquiring Fund will acquire all of the assets, subject to all of the
liabilities, of the Acquired Fund in exchange for shares of the Acquiring Fund.
Subject to the satisfaction of the conditions described below, the acquisition
will take place after the close of business on June 18, 2004 or on such later
date as may be determined by MIT and JHVST (the "Exchange Date"). The net asset
value per share of the Series I and Series II shares of the Acquired Fund and
the Acquiring Fund will be determined by dividing each Fund's assets, less
liabilities, attributable to each share class, by the total number of
outstanding shares of that class. The assets of each Fund will be valued in
accordance with the valuation practices of that Fund.
The number of full and fractional shares of the Acquiring Fund received by
a shareholder of the Acquired Fund will be equal in value to the value of the
shareholder's full and fractional shares of the Acquired Fund as of the close of
regularly scheduled trading on the New York Stock Exchange on the Exchange Date.
As of the Effective Time of the Reorganization, the Acquired Fund will liquidate
and distribute pro rata to its shareholders of record as of the close of
regularly scheduled trading on the New York Stock Exchange on the Exchange Date
the shares of the Acquiring Fund received by the Acquired Fund in the
Reorganization. The holders of Series I and Series II shares of the Acquired
Fund will receive, respectively, Series I and Series II shares of the Acquiring
Fund. Such liquidation and distribution will be accomplished by the
establishment of accounts on the share records of the Acquiring Fund in the
names of the shareholders of the Acquired Fund, each account representing the
respective pro rata number of shares of the Acquiring Fund due the shareholder.
After such distribution, MIT will take all necessary steps under Massachusetts
law, its Declaration of Trust and any other applicable law to effect a complete
dissolution of the Acquired Fund.
The MIT Board has determined that the interests of shareholders of and
contract owners whose contract
13
values are invested in shares of the Acquired Fund will not be diluted as a
result of the Reorganization and that participation in the Reorganization is in
the best interests of the Acquired Fund and such shareholders and contract
owners. Similarly, the JHVST Board has determined the Reorganization is in the
best interests of the Acquiring Fund and of its shareholders and contract owners
whose contract values are invested in shares of the Acquiring Fund and that the
interests of such shareholders and contract owners will not be diluted as a
result of the Reorganization.
The consummation of the Reorganization is subject to the conditions set
forth in the Plan, including that the affirmative vote of the holders of at
least a Majority of the Outstanding Voting Securities (as defined under "Voting
Information" below) of the Acquired Fund entitled to vote approve the
Reorganization. The Plan may be terminated and the Reorganization abandoned at
any time prior to the Effective Time of the Reorganization by mutual agreement
of MIT on behalf of the Acquired Fund and JHVST on behalf of the Acquiring Fund,
and by MIT on behalf of the Acquired Fund or JHVST on behalf of the Acquiring
Fund in the event of: (i) a breach by the other party or such Fund of any
material representation, warranty, covenant or agreement in the Plan to be
performed prior to the Effective Time of the Reorganization; (ii) a failure by
the other party or such Fund to fulfill a material condition precedent to the
obligations of the terminating party which has not been waived by the
terminating party; or (iii) a resolution by the MIT Board or the JHVST Board,
upon a determination made in good faith, that proceeding with this Plan is not
in the best interests of, respectively, the Acquired Fund, its shareholders and
contract owners whose contracts are funded by shares of the Acquired Fund or the
Acquiring Fund, its shareholders and contract owners whose contracts are funded
by shares of the Acquiring Fund. The Plan provides that MIT on behalf of the
Acquired Fund and JHVST on behalf of the Acquiring Fund may waive compliance
with any of the covenants or conditions made therein for the benefit of the
waiving party, except for certain conditions regarding the receipt of regulatory
approvals.
Certain of the existing investment limitations of the Acquired Fund
that require shareholder approval for amendment prohibit the Acquired Fund from
engaging in activities such as investing more than a stated percentage of its
assets in an issuer's securities. By approving the Plan, the shareholders of the
Acquired Fund will be deemed to have agreed to waive any such limitations solely
insofar as they might be deemed to apply to the Reorganization.
The expenses of the Reorganization (other than any registration fees
payable for the registration of shares of the Acquiring Fund in connection with
the Reorganization, which will be payable by the Acquiring Fund) will be borne
by the Acquired Fund and the Acquiring Fund in equal shares. See "Voting
Information" below.
If the Plan is not approved by the shareholders of the Acquired Fund or
is not consummated for any other reason, the MIT Board will consider other
possible courses of action. See "Voting Information." THE MIT BOARD, INCLUDING
ALL THE INDEPENDENT TRUSTEES, RECOMMENDS THAT SHAREHOLDERS APPROVE THE PLAN
UNDER PROPOSAL 1.
REASONS FOR THE REORGANIZATION
The principal purpose of the Reorganization is to provide a means by
which shareholders of and contract owners participating in the Acquired Fund, in
combination with the Acquiring Fund, may pursue substantially similar investment
objectives and policies in the context of a larger fund which has shown better
prospects for growth and demonstrated stronger performance in tracking its
target indices.
In determining whether to approve the Reorganization and recommend its
approval to shareholders, the MIT Board (including the Independent Trustees
(with the advice and assistance of independent legal counsel)), made an inquiry
into a number of matters and considered the following factors, among others: (1)
the compatibility of the investment objectives, policies and restrictions of the
Acquired and Acquiring Funds; (2) the current and historical performance of the
Acquired and Acquiring Funds; (3) the advantages to the Acquired Fund of
investing in a larger asset pool with potentially greater diversification; (4)
the possible benefits of a larger asset base to portfolio management of the
Acquiring Fund; (5) expense ratios and available information regarding the fees
and expenses of the Acquired and Acquiring Funds (historical and pro forma), as
well as of similar funds; (6) the investment experience, expertise and resources
of the respective subadvisers to the Acquired and Acquiring Funds; (7) the terms
and conditions of the Reorganization and whether the Reorganization would result
in dilution of shareholder or contract owner interests; (8) any direct and
indirect costs to be incurred by the Acquired and Acquiring Funds as a result of
the Reorganization; (8) the tax consequences of the Reorganization; and (9)
possible alternatives to the Reorganization.
14
In reaching the decision to recommend approval of the Reorganization,
the MIT Board concluded that the participation of the Acquired Fund in the
Reorganization is in the best interests of the Acquired Fund, as well as the
best interests of its shareholders and participating contract owners, and that
the interests of existing shareholders and contract owners will not be diluted
as a result of the Reorganization. The MIT Board's conclusion was based on a
number of factors, including the following:
1. The investment objective, strategies and risks of the Acquiring Fund
are substantially similar to those of the Acquired Fund and will afford
shareholders of the Acquired Fund continuity of investment objectives
and expectations.
2. As indicated by its historic performance and ability to attract
investors, the Acquired Fund has better prospects for growth than the
Acquired Fund.
3. The Acquiring Fund has historically out-performed the Acquired Fund in
more closely tracking its target indices.
4. The somewhat higher expense ratios of the Acquiring Fund than the
Acquired Fund (giving effect to certain voluntary expense
reimbursements) were viewed in light of the competitive level of the
advisory fees and the prospects for growth of the Acquiring Fund.
5. The Reorganization will permit shareholders of the Acquired Fund to
pursue their investment goals in the context of a larger fund
immediately following consummation of the Reorganization. It is
anticipated that the combined Acquired and Acquiring Funds should
enhance the ability of portfolio managers in structuring the portfolio
to be representative of the Acquiring Fund's target index.
DESCRIPTION OF THE SECURITIES TO BE ISSUED
Shareholders of the Acquired Fund will receive Series I or Series II
shares of the Acquiring Fund in accordance with the procedures set forth in the
Plan as described above. Each such share when issued will be fully paid and
non-assessable (except as noted under "Summary - Massachusetts Business Trusts,"
above) and will have no preemptive, exchange or similar rights. Such shares do
not have cumulative voting rights.
The shares of beneficial interest of JHVST currently are divided into
30 series, each corresponding to one of the JHVST Funds. JHVST has the right to
establish additional series and issue additional shares without the consent of
its shareholders.
If the holders of variable contracts show minimal interest in a JHVST
Fund, the JHVST Board, by majority vote, may eliminate that Fund or substitute
shares of another investment company. Any such action by the JHVST Board would
be subject to compliance with the requirements for governmental approvals or
exemptions or for shareholder approval. The holders of variable contracts
participating in any such Fund will be notified in writing of JHVST's intention
to eliminate such Fund and given 30 days to transfer amounts from such Fund to
other JHVST Funds without incurring any transaction fee. Amounts not transferred
or withdrawn would automatically be transferred, at the discretion of the Fund's
management.
As discussed above, the Acquiring Fund may issue three classes of
shares: NAV shares, Series I shares and Series II shares. Additional classes may
be offered in the future. The Acquiring Fund commenced offering Series I and
Series II shares on May 1, 2004 and will issue shares of such classes in
connection with the Reorganization. The relative rights and preferences of the
three classes are prescribed in, among other things, a plan that JHVST has
adopted under Rule 18f-3 (the "Rule 18f-3 Plan") under the 1940 Act.
Each issued and outstanding share of the Acquiring Fund is entitled to
participate equally as provided in the Rule 18f-3 Plan in dividends and
distributions declared with respect to the Acquiring Fund and upon liquidation
or dissolution in the net assets of the Fund remaining after satisfaction of
outstanding liabilities.
Expenses of the Acquiring Fund are borne by NAV, Series I and Series II
shares based on the net assets of
15
the Fund attributable to shares of each class. Notwithstanding the foregoing,
"class expenses" will be allocated to each class. "Class expenses" for the
Acquiring Fund include the 12b-1 fees paid with respect to a class and any other
expenses which are properly allocable to a particular class under the terms of
the Rule 18f-3 Plan.
FEDERAL INCOME TAX CONSEQUENCES.
As a condition to the consummation of the Reorganization, each of MIT
and JHVST will have received, in form and substance satisfactory to each, an
opinion from Dykema Gossett PLLC, tax counsel to MIT in connection with the
Reorganization, to the effect that, based on the facts and assumptions stated
therein, for federal income tax purposes: (1) the Reorganization will constitute
a reorganization within the meaning of Section 368(a)(1) of the Code with
respect to the Acquired Fund and the Acquiring Fund; (2) no gain or loss will be
recognized by the Acquired Fund or the Acquiring Fund upon the transfer of all
of the assets and liabilities, if any, of the Acquired Fund to the Acquiring
Fund solely in exchange for shares of the Acquiring Fund; (3) no gain or loss
will be recognized by shareholders of the Acquired Fund upon the exchange of
such Fund's shares solely for shares of the Acquiring Fund; (4) the holding
period and tax basis of the shares of the Acquiring Fund received by each holder
of shares of the Acquired Fund pursuant to the Reorganization will be the same
as the holding period and tax basis of the shares of the Acquired Fund held by
the shareholder (provided the shares of the Acquired Fund were held as a capital
asset on the date of the Reorganization) immediately prior to the
Reorganization; and (5) the holding period and tax basis of the assets of the
Acquired Fund acquired by the Acquiring Fund will be the same as the holding
period and tax basis of those assets to the Acquired Fund immediately prior to
the Reorganization.
CAPITALIZATION
The following table shows the capitalization of the Acquired Fund and
the Acquiring Fund as of December 31, 2003, and the pro forma combined
capitalization of the Acquiring Fund as if the Reorganization had occurred as of
that date. As of December 31, 2003, the Acquired Fund had outstanding three
classes of shares: Series I, Series II and Series III shares; at the time of the
Reorganization, it will have outstanding only two classes of shares: Series I
and Series II shares. As of December 31, 2003, the Acquiring Fund had
outstanding only one class of shares: NAV shares; it commenced offering Series I
and Series II shares on May 1, 2004 and will issue shares of such classes in
connection with the Reorganization. In addition, the pro forma net asset figures
reflect the anticipated withdrawal of Manulife U.S.A.'s initial investment in
the Acquired Fund ("seed capital") prior to the Exchange Date of the
Reorganization.
NET ASSETS NET ASSET SHARES
FUND (000'S Omitted) VALUE PER SHARE OUTSTANDING
---- --------------- --------------- -----------
MIT International Index Trust
(Acquired Fund)
--Series I shares $ 82,197 $ 9.08 9,056,146
--Series II shares 17,176 9.08 1,891,609
--Series III shares/A/ 3 9.08 374
JHVST International Equity Index Fund
(Acquiring Fund)
--NAV shares 159,036 13.82 11,508,157
--Series I shares -- -- --
--Series II shares -- -- --
PRO FORMA/B/
JHVST International Equity Index Fund
(Acquiring Fund)
--NAV shares 159,036 13.82 11,508,157
--Series I shares 82,197 13.82 5,947,684
--Series II shares 17,179 13.82 1,243,084
-------------
/A/ [The Series III shares were all redeemed prior to the record date for The
Special Meeting of Shareholders to vote on the Reorganization.]
/B/ The pro-forma figures for net assets and net asset values per share do not
reflect expenses of the Reorganization estimated to be $75,000 for each of the
Funds; and the pro-forma figures for net assets do not reflect Manulife
U.S.A.'s anticipated withdrawal of seed capital in the amount of $__________
at December 31, 2003 from the Acquired Fund prior to the Exchange Date of the
Reorganization.
16
VOTING INFORMATION
MIT sells its shares not directly to the public but generally only to
insurance companies and their separate accounts as the underlying investment
media for variable contracts, certain entities affiliated with the insurance
companies and, with respect to certain MIT Funds, trustees of qualified pension
and retirement plans. Only shares of a particular MIT Fund are entitled to vote
on matters which affect only the interests of that Fund. As of the Record Date
for the Special Meeting of Shareholders, the shares of the Acquired Fund were
legally owned by The Manufacturers Life Insurance Company (U.S.A.) ("Manulife
U.S.A") and The Manufacturers Life Insurance Company of New York ("Manulife New
York"). Each of Manulife U.S.A. and Manulife New York is an indirect,
wholly-owned subsidiary of The Manufacturers Life Insurance Company
("Manulife"). MFC is the holding company of Manulife and its subsidiaries,
collectively known as Manulife Financial. The principal offices of Manulife
Financial are located at 200 Bloor Street East, Toronto, Ontario, Canada M4W1E5.
Manulife U.S.A. is a stock life insurance company originally organized
under the laws of Pennsylvania and redomesticated under the laws of Michigan.
Its principal address is 200 Bloor Street East, Toronto, Ontario, Canada M4W
1E5. Manulife New York is a stock life insurance company organized under the
laws of New York whose principal address is 100 Summit Lake Drive, Second Floor,
Valhalla, New York 10595. Each of Manulife U.S.A. and Manulife New York holds
shares of MIT Funds directly and attributable to variable contracts in their
separate accounts. Such separate accounts include separate accounts registered
under the 1940 Act as well as unregistered separate accounts.
Shareholder Voting. Manulife U.S.A. and Manulife New York have the
right to vote upon matters that may be voted upon at a special shareholders'
meeting. These companies will vote all shares of the MIT Funds issued to them in
proportion to the timely instructions received from contract owners
participating in the separate accounts described above which are registered
under the 1940 Act. Manulife U.S.A. and Manulife New York, in connection with
their solicitation of voting instructions, are furnishing this Proxy
Statement/Prospectus to the owners of variable contracts participating in
registered separate accounts holding shares of the Acquired Fund to be voted at
the Meeting.
VOTING INFORMATION
Proxies may be revoked at any time prior to the voting of the shares
represented thereby by: (i) mailing written instructions addressed to the
Secretary of MIT at 73 Tremont Street, Boston, Massachusetts 02108, or (ii)
signing and returning a new proxy, in each case if received by MIT by June 17,
2004. ALL VALID PROXIES WILL BE VOTED IN ACCORDANCE WITH SPECIFICATIONS THEREON,
OR IN THE ABSENCE OF SPECIFICATIONS, FOR APPROVAL OF PROPOSAL 1.
Quorum; Definition of a Majority of Outstanding Voting Securities.
Shareholders of record at the close of business on April 20, 2004 (the "Record
Date") will be entitled to vote at the Meeting or any adjournment of the
Meeting. The holders of 30% of the shares outstanding of the Acquired Fund at
the close of business on that date present in person or by proxy will constitute
a quorum for the Meeting; however, a majority of the outstanding voting
securities of the Acquired Fund entitled to vote at the close of business on
that date is required to approve the Proposal, except as noted herein. As used
in this Proxy Statement/Prospectus, the vote of a "Majority of the Outstanding
Voting Securities" means the affirmative vote of the lesser of:
(1) 67% or more of the voting securities of MIT or an MIT Fund, as applicable,
present at the Meeting, if the holders of more than 50% of the outstanding
voting securities of MIT or an MIT Fund, as applicable, are present in
person or by proxy or
(2) more than 50% of the outstanding voting securities of MIT or an MIT Fund,
as applicable.
Shareholders are entitled to one vote for each Series I and Series II share held
and fractional votes for fractional shares held. No shares have cumulative
voting rights.
In the event the necessary quorum to transact business or the vote
required to approve the Reorganization under Proposal 1 is not obtained at the
Meeting, the persons named as proxies may propose one or more adjournments of
the Meeting in accordance with applicable law to permit further solicitation of
proxies. Any such
17
adjournment as to a matter will require the affirmative vote of the holders of a
majority of MIT's (or the relevant MIT Fund's) shares cast at the Meeting. The
persons named as proxies will vote for or against any adjournment in their
discretion.
Abstentions. Abstentions are counted as shares eligible to vote at the
Meeting in determining whether a quorum is present, but do not count as votes
cast with respect to a Proposal. Under the 1940 Act, the affirmative vote
necessary to approve a matter under consideration may be determined with
reference to a percentage of votes present at the Meeting, which would have the
effect of treating abstentions as if they were votes against a proposal.
Cost of Preparation and Distribution of Proxy Materials. The cost of
the preparation and distribution of these proxy materials will be borne by the
Acquired Fund and the Acquiring Fund in equal shares. In addition to the
solicitation of proxies by the use of the mails, proxies may be solicited by
officers and employees of the MIT, MIT's investment adviser, MSS, or its agents
or affiliates, personally or by telephone. Brokerage houses, banks and other
fiduciaries may be requested by the Funds to forward soliciting materials to
their principals and to obtain authorization for the execution of proxies. For
those services, they will be reimbursed by the Funds for their out-of-pocket
expenses.
Fund Voting. Series I and Series II shares of the Acquired Fund will
vote in the aggregate and not by class on the matters to be presented at the
Meeting.
As of the Record Date, the number of votes eligible to be cast at the
Meeting with respect to the Acquired Fund is as follows:
NUMBER OF VOTES HELD BY VOTES HELD BY
ACQUIRED FUND ELIGIBLE VOTES MANULIFE U.S.A. MANULIFE NEW YORK
-------------------------------------------------------------------------------------------------
MIT International Index Trust
OWNERSHIP OF SHARES OF THE FUNDS
Acquired Fund. As of the Record Date, the percentage ownership of the
outstanding shares of the Acquired Fund by Manulife U.S.A. and Manulife New York
is stated below:
NUMBER OF PERCENTAGE OF PERCENTAGE OF
OUTSTANDING SHARES HELD BY SHARES HELD BY
ACQUIRED FUND SHARES MANULIFE U.S.A. MANULIFE NEW YORK
-------------------------------------------------------------------------------------------------
MIT International Index Trust
As of the Record Date, Trustees and officers of MIT, in the aggregate,
beneficially owned or had the right to provide voting instructions for less than
1% of the outstanding shares of the Acquired Fund. As of the Record Date, the
following variable contract owners beneficially owned 5% or more of the
outstanding shares of the Acquired Fund:
NUMBER PERCENTAGE
NAME AND ADDRESS OF SHARES OWNERSHIP
---------------- --------- ---------
Acquiring Fund. As with shares of the MIT Funds, shares of the JHVST
Funds are not sold directly to the public but generally only to insurance
companies and their separate accounts as the underlying investment media for
variable contracts. As of the Record Date, the shares of the Acquiring Fund were
legally owned by John Hancock Life Insurance Company ("JHLICO"), a Massachusetts
life insurance company having its principal offices at 200 Clarendon Street,
Boston, Massachusetts 02117, and John Hancock Variable Life Insurance Company
18
("JHVLICO"), a Massachusetts life insurance company having its principal offices
at 197 Clarendon Street, Boston, Massachusetts 02117. The percentage ownership
of the outstanding shares of the Acquiring Fund as of the Record Date by JHLICO
and JHVLICO is stated below:
Number of Percentage of Percentage of
Outstanding Shares held by Shares held by
Acquiring Fund Shares JHLICO JHVLICO
-------------------------------------------------------------------------------------------
JHVST International Equity
Index Fund
As of the Record Date, no variable contract owner beneficially owned 5% or
more of the outstanding shares of the Acquiring Fund, and fewer than 1% of the
outstanding shares of the Acquiring Fund were attributable to variable contracts
owned by Trustees or officers of JHVST.
FINANCIAL STATEMENTS
The financial highlights of the Acquired Fund for the fiscal year ended
December 31, 2003 incorporated by reference into this Proxy
Statement/Prospectus, and the financial statements of MIT for the fiscal year
ended December 31, 2003 incorporated by reference into the related Statement of
Additional Information, have been so incorporated by reference in reliance on
the report of PricewaterhouseCoopers, LLP, independent accountants.
The financial highlights of the Acquiring Fund for the fiscal year ended
December 31, 2003 incorporated by reference into this Proxy
Statement/Prospectus, and the financial statements of JHVST for the fiscal year
ended December 31, 2003 incorporated by reference into the related Statement of
Additional Information, have been so incorporated by reference in reliance on
the report of Ernst & Young LLP, independent auditors.
The performance information included in the financial highlights of the
Funds does not reflect fees and expenses of any variable insurance contract
which may use MIT or JHVST as its underlying investment medium. If such fees and
expenses had been reflected, performance would be lower.
LEGAL MATTERS
Certain matters concerning the issuance of shares of the Acquiring Fund
will be passed upon by Ronald J. Bocage, Esq., Vice President and Counsel,
JHLICO, P.O. Box 111, Boston, Massachusetts 02117. Certain tax consequences of
the Reorganization will be passed upon by Dykema Gossett PLLC, 39577 Woodward
Avenue, Suite 300, Bloomfield Hills, Michigan 48304.
19
OTHER MATTERS
The MIT Board does not know of any matters to be presented at the Meeting
other than those mentioned in this Proxy Statement/Prospectus. If any other
matters properly come before the Meeting, the shares represented by proxies will
be voted in accordance with the best judgment of the person or persons voting
the proxies.
MIT is not required to hold annual meetings of shareholders and, therefore,
it cannot be determined when the next meeting of shareholders will be held.
Shareholder proposals to be presented at any future meeting of shareholders of
MIT must be received by MIT a reasonable time before its solicitation of proxies
for that meeting in order for such proposals to be considered for inclusion in
the proxy materials related to that meeting.
BY ORDER OF THE BOARD OF TRUSTEES OF MIT
May __, 2004
Boston, Massachusetts
It is important that proxies be returned promptly. Therefore, shareholders who
do not expect to attend the meeting in person are urged to complete, sign, date
and return the proxy card in the enclosed envelope.
20
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Plan") is made this ___ day
of _______, 2004, by and between Manufacturers Investment Trust ("MIT"), a
Massachusetts business trust with its principal place of business at 73 Tremont
Street, Boston, Massachusetts 02108, on behalf of its separate series, the
International Index Trust (the "Acquired Fund"), and John Hancock Variable
Series Trust I ("JHVST"), a Massachusetts business trust with its principal
place of business at John Hancock Place, P.O. Box 111, Boston, Massachusetts
02117, on behalf of its separate series, the International Equity Index Fund
(the "Acquiring Fund"). The Acquired Fund and the Acquiring Fund are sometimes
referred to herein collectively as the "Funds" and individually as a "Fund."
WHEREAS, the respective Boards of Trustees of MIT and JHVST have determined
that the transfer of all of the assets and liabilities of the Acquired Fund to
the Acquiring Fund is in the best interests of that Board's respective Fund, as
well as the best interests of shareholders and owners of variable life and
annuity contracts funded by shares of such Fund, and that the interests of
existing shareholders and contract owners participating in such Fund would not
be diluted as a result of this transaction;
WHEREAS, MIT and JHVST intend to provide for the reorganization of the
Acquired Fund (the "Reorganization") through the acquisition by the Acquiring
Fund of all of the assets, subject to all of the liabilities, of the Acquired
Fund in exchange for Series I and Series II shares of beneficial interest of the
Acquiring Fund (the "Acquiring Fund Shares"), the liquidation of the Acquired
Fund and the distribution to Acquired Fund shareholders of the Acquiring Fund
Shares;
NOW, THEREFORE, in consideration of the mutual promises herein contained,
MIT and JHVST agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR THE ACQUIRING FUND
SHARES AND LIQUIDATION OF THE ACQUIRED FUND
(a) Plan of Reorganization.
(i) As of the Effective Time of the Reorganization (as defined in Section
1(b)(i) hereof), MIT, on behalf of the Acquired Fund, will convey, transfer and
deliver to the Acquired Fund all of the then existing assets of the Acquired
Fund (consisting, without limitation, of portfolio securities and instruments,
dividend and interest receivables, cash and other assets). In consideration
thereof, JHVST, on behalf of the Acquiring Fund, will (A) assume and pay, to the
extent that they exist on or after the Effective Time of the Reorganization, all
of the obligations and liabilities of the Acquired Fund and (B) issue and
deliver to the Acquired Fund that number of full and fractional Series I and
Series II shares of the Acquiring Fund as determined in Section 1(c) hereof. Any
Series I and Series II shares of capital stock (if any) of the Acquired Fund
("Acquired Fund Shares") held in the treasury of MIT at the Effective Time of
the Reorganization shall thereupon be retired. Such transactions shall take
place on the date provided for in Section 1(b) hereof (the "Exchange Date"). All
computations for the Acquired Fund and the Acquiring Fund shall be performed by
State Street Bank and Trust Company (the "Custodian"), as custodian and pricing
agent for the Acquired Fund and the Acquiring Fund, subject to the control and
direction of each Fund and its Board and in accordance with the usual pricing
and valuation procedures of the respective Funds. The parties agree to
communicate with one another sufficiently in advance concerning the nature and
manner of valuation of all their respective assets and liabilities that any
material differences in the value ascribed by each Fund to any assets or
liabilities that the Acquiring Fund would assume in the Reorganization can be
reconciled prior to the Exchange Date. The parties agree to attempt in good
faith to reconcile any such material differences. In the absence of such
reconciliation, the determination of the Custodian shall be conclusive and
binding on all parties in interest.
(ii) As of the Effective Time of the Reorganization, the Acquired Fund will
liquidate and distribute pro rata to its shareholders of record ("Acquired Fund
shareholders") as of the Effective Time of the Reorganization the Acquiring Fund
Shares received by the Acquired Fund pursuant to Section 1(a)(i) in actual or
constructive exchange for the shares of the Acquired Fund held by the Acquired
Fund shareholders. The holders of Series I and Series II shares of
21
the Acquired Fund will receive, respectively, Series I and Series II shares of
the Acquiring Fund. Such liquidation and distribution will be accomplished by
the transfer of the Acquiring Fund Shares then credited to the account of the
Acquired Fund on the books of the Acquiring Fund to open accounts on the share
records of the Acquiring Fund in the names of the Acquired Fund shareholders and
representing the respective pro-rata number of the Acquiring Fund Shares due
such shareholders. The Acquiring Fund will not issue certificates representing
the Acquiring Fund Shares in connection with such exchange.
(iii) As soon as practicable after the Effective Time of the
Reorganization, MIT shall take all the necessary steps under Massachusetts law,
its Declaration of Trust and any other applicable law to effect a complete
dissolution of the Acquired Fund. Any reporting of the Acquired Fund, including
but not limited to the responsibility for filing of reports with the Securities
and Exchange Commission (the "Commission"), other regulatory reports and tax
returns, is and shall remain the responsibility of MIT.
(b) Exchange Date and Effective Time of the Reorganization.
(i) Subject to the satisfaction of the conditions to the Reorganization
specified in this Plan, the Reorganization shall occur as of the close of
regularly scheduled trading on the New York Stock Exchange (the "Effective Time
of the Reorganization") on the day (the "Exchange Date") which is the later of
(A) the final adjournment of the meeting of the holders of Acquired Fund Shares
at which this Plan will be considered, (B) immediately after the
close of business on June 18, 2004 and (C) such later day as MIT and JHVST may
determine.
(ii) All acts taking place on the Exchange Date shall be deemed to take
place simultaneously as of the Effective Time of the Reorganization unless
otherwise provided.
(iii) In the event that on the proposed Exchange Date (A) the New York
Stock Exchange shall be closed to trading or trading thereon shall be
restricted, or (B) trading or the reporting of trading on said Exchange or
elsewhere shall be disrupted so that accurate valuation of the net assets of the
Acquiring Fund or the Acquired Fund is impracticable, the Exchange Date shall be
postponed until the first business day after the day when trading shall have
been fully resumed and reporting shall have been restored.
(iv) On the Exchange Date, portfolio securities of the Acquired Fund that
are not held in book-entry form shall be transferred by the Custodian to the
account of the Acquiring Fund duly endorsed in proper form for transfer, in such
condition as to constitute good delivery thereof in accordance with the custom
of brokers, and shall be accompanied by all necessary federal and state stock
transfer stamps or a check for the appropriate purchase price thereof; portfolio
securities held of record by the Custodian in book-entry form on behalf of the
Acquired Fund shall be delivered to the Acquiring Fund by the Custodian's
recording the transfer of beneficial ownership thereof on its records; and cash
delivered shall be in the form of currency or by the Custodian's crediting the
Acquiring Fund's account maintained with the Custodian with immediately
available funds.
(c) Valuation.
(i) The net asset value per share of the Series I and Series II shares of
the Acquiring Fund and the net value of the assets of the Acquired Fund to be
transferred in exchange for such Series I and Series II shares shall be
determined as of the Effective Time of the Reorganization. The net asset value
per share of the Series I and Series II shares of the Acquiring Fund shall be
computed by the Custodian in the manner set forth in JHVST's Declaration of
Trust or By-laws and then current prospectus and statement of additional
information and shall be computed to not less than four decimal places. The net
value of the assets of the Acquired Fund to be transferred shall be computed by
the Custodian by calculating the value of the assets of the Acquired Fund and by
subtracting therefrom the amount of the liabilities assigned and transferred to
the Acquiring Fund, said assets and liabilities to be valued in the manner set
forth in MIT's Declaration of Trust or By-laws and then current prospectus and
statement of additional information.
(ii) The number of Series I and Series II shares of the Acquiring Fund to
be issued (including fractional shares, if any) by the Acquiring Fund in
exchange for the Acquired Fund's assets shall be determined by dividing the net
value of the assets of the Acquired Fund attributable to shares of each class
and to be transferred by the net asset
22
value per shares of the Series I and Series II shares of the Acquiring Fund,
both as determined in accordance with Section 1(c)(i).
(iii) All computations of value shall be made by the Custodian in the manner
set forth in paragraphs (a)(i) and (c)(i) above.
2. REPRESENTATIONS AND WARRANTIES OF JHVST ON BEHALF OF THE ACQUIRING FUND
JHVST on behalf of the Acquiring Fund represents and warrants as follows:
(a) Organization, Existence, etc. JHVST is a business trust that is duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has the power to carry on its business as it
is now being conducted. The Acquiring Fund is a validly existing series of
shares of such business trust representing interests in a separate portfolio
thereof under the laws of Massachusetts. Each of the Acquiring Fund and JHVST
has all necessary federal, state and local authorization to own all of its
properties and assets and to carry on its business as now being conducted.
(b) Registration as Investment Company. JHVST is registered under the
Investment Company Act of 1940, as amended (the "Act") as an open-end investment
company of the management type; such registration has not been revoked or
rescinded and is in full force and effect.
(c) Current Offering Documents. The current prospectus of JHVST dated May
1, 2003 and the current statement of additional information of JHVST dated May
1, 2003, each as supplemented or amended and as may be further supplemented or
amended, included in JHVST's registration statement on Form N-1A filed with the
Commission, comply in all material respects with the requirements of the
Securities Act of 1933, as amended (the "Securities Act") and the Act and do not
contain an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(d) Capitalization. JHVST has an unlimited number of authorized shares of
beneficial interest of which as of March ___, 2004 there were outstanding the
following numbers of shares of the Acquiring Fund: __________ NAV shares. All of
the outstanding shares of JHVST have been duly authorized and are validly
issued, fully paid and non-assessable (recognizing that under Massachusetts law,
shareholders of a JHVST series could, under certain circumstances, be held
personally liable for the obligations of JHVST). Because JHVST is an open-end
investment company engaged in the continuous offering and redemption of its
shares, the number of outstanding shares may change prior to the Effective Time
of the Reorganization. All of the issued and outstanding shares of the Acquiring
Fund have been offered and sold in compliance in all material respects with
applicable registration requirements of the Securities Act and any applicable
state securities laws.
(e) Financial Statements. The financial statements of JHVST for the fiscal
year ended December 31, 2003, which have been audited by Ernst & Young LLP,
fairly present the financial position of the Acquiring Fund as of the dates
thereof and the respective results of operations and changes in net assets for
each of the periods indicated in accordance with generally accepted accounting
principles ("GAAP").
(f) Shares to be Issued Upon Reorganization. The Acquiring Fund Shares to
be issued in connection with the Reorganization will be duly authorized and upon
consummation of the Reorganization will be validly issued, fully paid and
non-assessable (except as disclosed in JHVST's prospectus and recognizing that
under Massachusetts law, shareholders of a JHVST series could, under certain
circumstances, be held personally liable for the obligations of such series).
(g) Authority Relative to this Plan. JHVST, on behalf of the Acquiring
Fund, has the power to enter into this Plan and to carry out its obligations
hereunder. The execution and delivery of this Plan and the consummation of the
transactions contemplated hereby have been duly authorized by JHVST's Board of
Trustees and no other proceedings by JHVST other than those contemplated under
this Plan are necessary to authorize its officers to effectuate this Plan and
the transactions contemplated hereby. JHVST is not a party to or obligated under
any provision of its Declaration of Trust or By-laws, or under any indenture or
contract provision or any other
23
commitment or obligation, or subject to any order or decree, which would be
violated by or which would prevent its execution and performance of this Plan in
accordance with its terms.
(h) Liabilities. There are no liabilities of the Acquiring Fund, whether
actual or contingent and whether or not determined or determinable, other than
liabilities disclosed or provided for in JHVST's Financial Statements with
respect to the Acquiring Fund and liabilities incurred in the ordinary course of
business subsequent to December 31, 2003 or otherwise previously disclosed to
and accepted by MIT with respect to the Acquiring Fund, none of which has been
materially adverse to the business, assets or results of operations of the
Acquiring Fund.
(i) No Material Adverse Change. Since December 31, 2003, there has been no
material adverse change in the financial condition, results of operations,
business, properties or assets of the Acquiring Fund, other than those occurring
in the ordinary course of business (for these purposes, a decline in net asset
value and a decline in net assets due to redemptions do not constitute a
material adverse change).
(j) Litigation. There are no claims, actions, suits or proceedings pending
or, to the knowledge of JHVST, threatened which would adversely affect JHVST or
the Acquiring Fund's assets or business or which would prevent or hinder
consummation of the transactions contemplated hereby, there are no facts which
would form the basis for the institution of administrative proceedings against
JHVST or the Acquiring Fund and, to the knowledge of JHVST, there are no
regulatory investigations of JHVST or the Acquiring Fund, pending or threatened,
other than routine inspections and audits.
(k) Contracts. No default exists under any material contract or other
commitment to which JHVST, on behalf of the Acquiring Fund, is subject.
(l) Taxes. All federal and other income tax returns of JHVST with respect
to the Acquiring Fund required to be filed by JHVST with respect to the
Acquiring Fund have been filed for all taxable years to and including December
31, 2003, and all taxes payable pursuant to such returns have been paid. To the
knowledge of JHVST, no such return is under audit and no assessment has been
asserted in respect of any such return. All federal and other taxes owed by
JHVST with respect to the Acquiring Fund have been paid so far as due. JHVST and
the Acquiring Fund currently are, at all times since their inception have been,
and will continue to be up until and at the Exchange Date, in compliance with
Section 817(h)(1) of the Internal Revenue Code of 1986, as amended (the "Code"),
and Treas. Reg. Section 1.817-5, as if those provisions applied directly to that
Fund relating to the diversification requirements for variable annuity,
endowment and life insurance contracts. The Acquiring Fund's shares are (and
since its inception have been) held only by (a) insurance company "segregated
asset accounts" within the meaning of Treas. Reg. Section 1.817-5(e) and (b)
other purchasers of the kind specified in Treas. Reg. Section 1.817-5(f)(3) as
from time to time in effect. The Acquiring Fund is, and at all times since its
inception has been, qualified as a "regulated investment company" under
subchapter M of the Code.
(m) No Approvals Required. Except for the Registration Statement (as
defined in Section 4(a) hereof) and the approval of the Acquired Fund's
shareholders (referred to in Section 6(a) hereof), no consents, approvals,
authorizations, registrations or exemptions under federal or state laws are
necessary for the consummation by JHVST of the Reorganization, except such as
have been obtained as of the date hereof.
(n) At the time the Registration Statement becomes effective, the
Registration Statement, except as to information relating to the Acquired Fund
that is provided or approved by MIT pursuant to Section 5(c) hereof, (i) will
comply in all material respects with the provisions of the Securities Act and
the rules and regulations of the Commission thereunder (the "Regulations") and
(ii) will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and at the time the Registration Statement becomes
effective, at the time of the Acquired Fund shareholders' meeting referred to in
Section 5(a) hereof, and at the Effective Time of the Reorganization, the proxy
statement/prospectus (the "Prospectus") and statement of additional information
(the "Statement of Additional Information") included therein, as amended or
supplemented by any amendments or supplements filed by JHVST, will not contain
an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
24
3. REPRESENTATIONS AND WARRANTIES OF MIT ON BEHALF OF THE ACQUIRED FUND
MIT on behalf of the Acquired Fund represents and warrants as follows:
(a) Organization, Existence, etc. MIT is a business trust that is duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has the power to carry on its business as it
is now being conducted. The Acquired Fund is a validly existing series of shares
of such business trust representing interests in a separate portfolio thereof
under the laws of Massachusetts. Each of the Acquired Fund and MIT has all
necessary federal, state and local authorization to own all of its properties
and assets and to carry on its business as now being conducted.
(b) Registration as Investment Company. MIT is registered under the Act as
an open-end investment company of the management type; such registration has not
been revoked or rescinded and is in full force and effect.
(c) Current Offering Documents. The current prospectus of MIT dated May 1,
2003 and the current statement of additional information of MIT dated May 1,
2003, each as supplemented or amended and as may be further supplemented or
amended, included in MIT's registration statement on Form N-1A filed with the
Commission, comply in all material respects with the requirements of the
Securities Act and the Act and do not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
(d) Capitalization. MIT has an unlimited number of authorized shares of
beneficial interest of which as of March ___, 2004 there were outstanding the
following numbers of shares of the Acquired Fund : __________ Series I shares
and __________ Series II shares, and no shares of such Fund were held in the
treasury of MIT. All of the outstanding shares of MIT have been duly authorized
and are validly issued, fully paid and non-assessable (except as disclosed in
MIT's prospectus and recognizing that under Massachusetts law, shareholders of
an MIT series could, under certain circumstances, be held personally liable for
the obligations of such MIT series). Because MIT is an open-end investment
company engaged in the continuous offering and redemption of its shares, the
number of outstanding shares may change prior to the Effective Time of the
Reorganization. All such shares will, at the Exchange Date, be held in
book-entry form by shareholders of record of the Acquired Fund as set forth on
the books and records of MIT in the amounts set forth therein, and as set forth
in any list of shareholders of record provided to the Acquiring Fund for
purposes of the Reorganization, and no such shareholders of record will have any
preemptive rights to purchase any Acquired Fund Shares, and the Acquired Fund
does not have outstanding any options, warrants or other rights to subscribe for
or purchase any Acquired Fund Shares (other than any existing dividend
reinvestment plans of the Acquired Fund or as set forth in this Plan), nor are
there outstanding any securities convertible into any shares of the Acquired
Fund (except pursuant to any existing exchange privileges described in the
current prospectus and statement of additional information of MIT). All of the
Acquired Fund's issued and outstanding shares have been offered and sold in
compliance in all material respects with applicable registration
requirements of the Securities Act and any applicable state securities laws.
(e) Financial Statements. The financial statements of MIT for the fiscal
year ended December 31, 2003, which have been audited by PriceWaterhouseCoopers
LLP, fairly present the financial position of the Acquired Fund as of the dates
thereof and the respective results of operations and changes in net assets for
each of the periods indicated in accordance with GAAP.
(f) Authority Relative to this Plan. MIT, on behalf of the Acquired Fund,
has the power to enter into this Plan and to carry out its obligations
hereunder. The execution and delivery of this Plan and the consummation of the
transactions contemplated hereby have been duly authorized by MIT's Board of
Trustees and no other proceedings by MIT other than those contemplated under
this Plan are necessary to authorize its officers to effectuate this Plan and
the transactions contemplated hereby. MIT is not a party to or obligated under
any provision of its Declaration of Trust or By-laws, or under any indenture or
contract provision or any other commitment or obligation, or subject to any
order or decree, which would be violated by or which would prevent its execution
and performance of this Plan in accordance with its terms.
(g) Liabilities. There are no liabilities of the Acquired Fund, whether
actual or contingent and whether or not determined or determinable, other than
liabilities disclosed or provided for in MIT's Financial Statements with
25
respect to the Acquired Fund and liabilities incurred in the ordinary course of
business subsequent to December 31, 2003 or otherwise previously disclosed to
and accepted by JHVST with respect to the Acquired Fund, none of which has been
materially adverse to the business, assets or results of operations of the
Acquired Fund .
(h) No Material Adverse Change. Since December 31, 2003, there has been no
material adverse change in the financial condition, results of operations,
business, properties or assets of the Acquired Fund, other than those occurring
in the ordinary course of business (for these purposes, a decline in net asset
value and a decline in net assets due to redemptions do not constitute a
material adverse change).
(i) Litigation. There are no claims, actions, suits or proceedings pending
or, to the knowledge of MIT, threatened which would adversely affect MIT or the
Acquired Fund's assets or business or which would prevent or hinder consummation
of the transactions contemplated hereby, there are no facts which would form the
basis for the institution of administrative proceedings against MIT or the
Acquired Fund and, to the knowledge of MIT, there are no regulatory
investigations of MIT or the Acquired Fund , pending or threatened, other than
routine inspections and audits.
(j) Contracts. MIT, on behalf of the Acquired Fund , is not subject to any
contracts or other commitments (other than this Plan) which will not be
terminated with respect to the Acquired Fund without liability to MIT or the
Acquired Fund as of or prior to the Effective Time of the Reorganization.
(k) Taxes. All federal and other income tax returns of MIT with respect to
the Acquired Fund required to be filed by MIT with respect to the Acquired Fund
have been filed for all taxable years to and including December 31, 2003, and
all taxes payable pursuant to such returns have been paid. To the knowledge of
MIT, no such return is under audit and no assessment has been asserted in
respect of any such return. All federal and other taxes owed by MIT with respect
to the Acquired Fund have been paid so far as due. MIT and the Acquired Fund
currently are, at all times since their inception have been, and will continue
to be up until and at the Exchange Date, in compliance with Section 817(h)(1) of
the Code and Treas. Reg. Section 1.817-5, as if those provisions applied
directly to that Fund relating to the diversification requirements for variable
annuity, endowment and life insurance contracts. The Acquired Fund's shares are
(and since its inception have been) held only by (a) insurance company
"segregated asset accounts" within the meaning of Treas. Reg. Section 1.817-5(e)
and (b) other purchasers of the kind specified in Treas. Reg. Section
1.817-5(f)(3) as from time to time in effect. The Acquired Fund is, and at all
times since its inception has been, qualified as a "regulated investment
company" under subchapter M of the Code.
(l) No Approvals Required. Except for the Registration Statement (as
defined in Section 4(a) hereof) and the approval of the Acquired Fund's
shareholders referred to in Section 6(a) hereof, no consents, approvals,
authorizations, registrations or exemptions under federal or state laws are
necessary for the consummation by MIT of the Reorganization, except such as have
been obtained as of the date hereof.
(m) At the time the Registration Statement becomes effective, the
Registration Statement, insofar as it relates to the Acquired Fund, (i) will
comply in all material respects with the provisions of the Securities Act and
the Regulations and (ii) will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and at the time the Registration
Statement becomes effective, at the time of the Acquired Fund's shareholders'
meeting referred to in Section 5(a) and at the Effective Time of the
Reorganization, the Prospectus and Statement of Additional Information, as
amended or supplemented by any amendments or supplements filed by JHVST, insofar
as they relate to the Acquired Fund, will not contain an untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the representations and warranties in this
subsection shall apply only to statements in or omissions from the Registration
Statement, Prospectus or Statement of Additional Information made in reliance
upon and in conformity with information furnished or approved by MIT for use in
the Registration Statement, Prospectus or Statement of Additional Information as
provided in Section 5(c).
26
4. COVENANTS OF JHVST ON BEHALF OF THE ACQUIRING FUND
JHVST on behalf of the Acquiring Fund covenants to the following:
(a) Registration Statement. On behalf of the Acquiring Fund, JHVST shall
file with the Commission a Registration Statement on Form N-14 (the
"Registration Statement") under the Securities Act relating to the Acquiring
Fund Shares issuable hereunder and the proxy statement of the Acquired Fund
relating to the meeting of the Acquired Fund's shareholders referred to in
Section 5(a) herein.
(b) Cooperation in Effecting Reorganization. JHVST agrees to use all
reasonable efforts to effectuate the Reorganization, to continue in operation
thereafter, and to obtain any necessary regulatory approvals for the
Reorganization. JHVST shall furnish such data and information relating to the
Acquiring Fund as shall be reasonably requested for inclusion in the information
to be furnished to the Acquired Fund shareholders in connection with the meeting
of the Acquired Funds' shareholders for the purpose of acting upon this Plan and
the transactions contemplated herein.
(c) Operations in the Ordinary Course. Except as otherwise contemplated by
this Plan, JHVST with respect to the Acquiring Fund shall conduct its business
in the ordinary course until the consummation of the Reorganization, it being
understood that such ordinary course of business will include the declaration
and payment of customary dividends and distributions.
5. COVENANTS OF MIT ON BEHALF OF THE ACQUIRED FUND
MIT on behalf of the Acquired Fund covenants to the following:
(a) Meeting of the Acquired Fund's Shareholders. MIT shall call and hold a
meeting of the shareholders of the Acquired Fund for the purpose of acting upon
this Plan and the transactions contemplated herein.
(b) Portfolio Securities. With respect to the assets to be transferred in
accordance with Section 1(a), the Acquired Fund's assets shall consist of all
property and assets of any nature whatsoever, including, without limitation, all
cash, cash equivalents, securities, claims and receivables (including dividend
and interest receivables) owned, and any deferred or prepaid expenses shown as
an asset on MIT's books. At least five (5) business days prior to the Exchange
Date, the Acquired Fund will provide MIT, for the benefit of the Acquiring Fund,
with a list of its assets and a list of its stated liabilities. The Acquired
Fund shall have the right to sell any of the securities or other assets shown on
the list of assets prior to the Exchange Date but will not, without the prior
approval of JHVST, on behalf of the Acquiring Fund, acquire any additional
securities other than securities which the Acquiring Fund is permitted to
purchase, pursuant to its investment objective and policies or otherwise (taking
into consideration its own portfolio composition as of such date). In the event
that the Acquired Fund holds any investments that the Acquiring Fund would not
be permitted to hold, the Acquired Fund will dispose of such securities prior to
the Exchange Date to the extent practicable and to the extent that its
shareholders would not be materially affected in an adverse manner by such a
disposition. In addition, MIT will prepare and deliver, immediately prior to the
Effective Time of the Reorganization, a Statement of Assets and Liabilities of
the Acquired Fund, prepared in accordance with GAAP (the "Schedule"), which
Schedule shall be certified by the principal accounting officer of the Acquired
Fund. All securities to be listed in the Schedule as of the Effective Time of
the Reorganization will be owned by the Acquired Fund free and clear of any
liens, claims, charges, options and encumbrances, except as indicated in the
Schedule and as accepted by JHVST, and, except as so indicated and accepted,
none of such securities is or, after the Reorganization as contemplated hereby,
will be subject to any restrictions, legal or contractual, on the disposition
thereof (including restrictions as to the public offering or sale thereof under
the Securities Act) and, except as so indicated and accepted, all such
securities are or will be readily marketable.
(c) Registration Statement. In connection with the preparation of the
Registration Statement, MIT will cooperate with JHVST and will furnish to JHVST
the information relating to the Acquired Fund required by the Securities Act and
the Regulations to be set forth in the Registration Statement (including the
Prospectus and Statement of Additional Information).
27
(d) Cooperation in Effecting Reorganization. MIT agrees to use all
reasonable efforts to effectuate the Reorganization and to obtain any necessary
regulatory approvals for the Reorganization.
(e) Operations in the Ordinary Course. Except as otherwise contemplated by
this Plan, MIT with respect to the Acquired Fund shall conduct its business in
the ordinary course until the consummation of the Reorganization, it being
understood that such ordinary course of business will include the declaration
and payment of customary dividends and distributions.
(f) Statement of Earnings and Profits. As promptly as practicable, but in
any case within 60 days after the Exchange Date, MIT on behalf of the Acquired
Fund, shall prepare a statement of the earnings and profits of the Acquired Fund
for federal income tax purposes, and of any capital loss carryovers and other
items that the Acquiring Fund will succeed to and take into account as a result
of Section 381 of the Code. Such statement will be certified by the principal
accounting officer of the Acquired Fund.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF MIT ON BEHALF OF THE ACQUIRED FUND
The obligations of MIT on behalf the Acquired Fund with respect to the
consummation of the Reorganization are subject to the satisfaction of the
following conditions:
(a) Approval by the Acquired Fund's Shareholders. This Plan and the
transactions contemplated by the Reorganization shall have been approved by the
requisite vote of the shares of the Acquired Fund entitled to vote on the matter
("Acquired Fund Shareholder Approval").
(b) Covenants, Warranties and Representations. JHVST shall have complied
with each of its covenants contained herein, each of the representations and
warranties contained herein shall be true in all material respects as of the
Effective Time of the Reorganization (except as otherwise contemplated herein),
and there shall have been no material adverse change (as described in Section
2(i)) in the financial condition, results of operations, business, properties or
assets of the Acquiring Fund since December 31, 2003.
(c) JHVST on behalf of the Acquiring Fund shall have delivered to MIT on
behalf of the Acquired Fund a certificate executed in its name by JHVST's
principal accounting officer, in form and substance satisfactory to MIT on
behalf of the Acquired Fund and dated as of the Exchange Date, to the effect
that the representations and warranties of JHVST on behalf of the Acquiring Fund
made in the Plan are true and correct at and as of the Exchange Date, except as
may be affected by the transactions contemplated by the Plan.
(d) Regulatory Approval. The Registration Statement shall have been
declared effective by the Commission and no stop orders under the Securities Act
pertaining thereto shall have been issued and all other approvals,
registrations, and exemptions under federal and state laws considered to be
necessary shall have been obtained (collectively, the "Regulatory Approvals").
(e) Tax Opinion. MIT shall have received the opinion of Dykema Gossett
PLLC, dated on or before the Effective Time of the Reorganization, addressed to
and in form and substance satisfactory to MIT and JHVST, as to certain of the
federal income tax consequences under the Code of the Reorganization insofar as
it relates to the Acquired Fund and the Acquiring Fund. For purposes of
rendering its opinion, Dykema Gossett PLLC may rely exclusively and without
independent verification, as to factual matters, on the statements made in the
Plan, the Prospectus and Statement of Additional Information, and on such other
written representations as, respectively, the President or Treasurer of MIT and
the President or Treasurer of JHVST, will have verified as of the Effective Time
of the Reorganization. The opinion will be to the effect that, based on the
facts and assumptions stated therein, for federal income tax purposes: (1) the
Reorganization will constitute a reorganization within the meaning of Section
368(a)(1) of the Code with respect to the Acquired Fund and the Acquiring Fund;
(2) no gain or loss will be recognized by the Acquired Fund or the Acquiring
Fund upon the transfer of all of the assets and liabilities, if any, of the
Acquired Fund to the Acquiring Fund solely in exchange for shares of the
Acquiring Fund; (3) no gain or loss will be recognized by shareholders of the
Acquired Fund upon the exchange of such Fund's shares solely for shares of the
corresponding Acquiring Fund; (4) the holding period and tax basis of the shares
of the Acquiring Fund received by each holder of shares of the Acquired Fund
pursuant to the Reorganization will be the same as the holding period and tax
basis of the shares of the Acquired Fund held by the shareholder (provided the
shares of the
28
Acquired Fund were held as a capital asset on the date of the Reorganization)
immediately prior to the Reorganization; and (5) the holding period and tax
basis of the assets of the Acquired Fund acquired by the Acquiring Fund will be
the same as the holding period and tax basis of those assets to the Acquired
Fund immediately prior to the Reorganization.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF JHVST ON BEHALF OF THE ACQUIRING
FUND
The obligations of JHVST on behalf of the Acquiring Fund with respect to
the consummation of the Reorganization are subject to the satisfaction of the
following conditions:
(a) Approval by the Acquired Fund's Shareholders. The Acquired Fund
Shareholder Approval shall have been obtained.
(b) Covenants, Warranties and Representations. MIT shall have complied with
each of its covenants contained herein, each of the representations and
warranties contained herein shall be true in all material respects as of the
Effective Time of the Reorganization (except as otherwise contemplated herein),
and there shall have been no material adverse change (as described in Section
3(h) in the financial condition, results of operations, business, properties or
assets of the Acquired Fund since December 31, 2003.
(c) MIT on behalf of the Acquired Fund shall have delivered to JHVST on
behalf of the Acquiring Fund a certificate executed in its name by MIT's
principal accounting officer, in form and substance satisfactory to JHVST on
behalf of the Acquiring Fund and dated as of the Exchange Date, to the effect
that the representations and warranties of MIT on behalf of the Acquired Fund
made in the Plan are true and correct at and as of the Exchange Date, except as
may be affected by the transactions contemplated by the Plan.
(d) Portfolio Securities. All securities to be acquired by the Acquiring
Fund in the Reorganization shall have been approved for acquisition by the
investment adviser (or, at the discretion of such investment adviser, by the
subadviser) for the Acquiring Fund as consistent with its investment policies.
(e) Regulatory Approval. The Regulatory Approvals shall have been obtained.
(e) Distribution of Income and Gains. MIT on behalf of the Acquired Fund
shall have distributed to the shareholders of the Acquired Fund, in a
distribution or distributions qualifying for the deduction for dividends paid
under Section 561 of the Code, all of its investment company taxable income
(without regard to the deductions for dividends paid) as defined in Section
852(b)(2) of the Code (determined without regard to Section 852(b)(2)(D) of the
Code) for its taxable year ending on the Exchange Date, all of the excess of (i)
its interest income excludable from gross income under Section 103(a) of the
Code over (ii) its deductions disallowed under Sections 265 and 171(a)(2) of the
Code for its taxable year ending on the Exchange Date, and all of its net
capital gain as such term is used in Section 852(b)(3) of the Code, after
reduction by any capital loss carryforward, for its taxable year ending on the
Exchange Date.
(f) Tax Opinion. JHVST shall have received the opinion of Dykema Gossett
PLLC, dated on or before the Effective Time of the Reorganization, addressed to
and in form and substance satisfactory to MIT and JHVST, as to certain of the
federal income tax consequences under the Code of the Reorganization insofar as
it relates to the Acquired Fund and the Acquiring Fund. For purposes of
rendering its opinion, Dykema Gossett PLLC may rely exclusively and without
independent verification, as to factual matters, on the statements made in the
Plan, the Prospectus and Statement of Additional Information, and on such other
written representations as, respectively, the President or Treasurer of MIT and
the President or Treasurer of JHVST, will have verified as of the Effective Time
of the Reorganization. The opinion will be to the effect that, based on the
facts and assumptions stated therein, for federal income tax purposes: (1) the
Reorganization will constitute a reorganization within the meaning of Section
368(a)(1) of the Code with respect to the Acquired Fund and the Acquiring Fund;
(2) no gain or loss will be recognized by the Acquired Fund or the Acquiring
Fund upon the transfer of all of the assets and liabilities, if any, of the
Acquired Fund to the Acquiring Fund solely in exchange for shares of the
Acquiring Fund; (3) no gain or loss will be recognized by shareholders of the
Acquired Fund upon the exchange of such Fund's shares solely for shares of the
corresponding Acquiring Fund; (4) the holding period and tax basis of the shares
of the Acquiring Fund
29
received by each holder of shares of the Acquired Fund pursuant to the
Reorganization will be the same as the holding period and tax basis of the
shares of the Acquired Fund held by the shareholder (provided the shares of the
Acquired Fund were held as a capital asset on the date of the Reorganization)
immediately prior to the Reorganization; and (5) the holding period and tax
basis of the assets of the Acquired Fund acquired by the Acquiring Fund will be
the same as the holding period and tax basis of those assets to the Acquired
Fund immediately prior to the Reorganization
8. AMENDMENTS; TERMINATIONS; NO SURVIVAL OF COVENANTS, WARRANTIES AND
REPRESENTATIONS
(a) Amendments. MIT and JHVST may, by an instrument in writing authorized
by their respective Boards of Trustees, amend this Plan at any time before or
after approval hereof by the shareholders of the Acquired Fund, but after such
approval, no amendment shall be made which substantially changes the terms
hereof.
(b) Waivers. At any time prior to the Effective Time of the Reorganization,
each of MIT, on behalf of the Acquired Fund, and JHVST, on behalf of the
Acquiring Fund, may by written instrument signed by it (i) waive any
inaccuracies in the representations and warranties made to it and such Fund
contained herein and (ii) waive compliance with any of the covenants or
conditions made for its benefit and the benefit of such Fund contained herein,
except that conditions set forth in Sections 6(c) and 7(d) may not be waived.
(c) Termination. This Plan may be terminated by the mutual agreement of MIT
on behalf of the Acquired Fund and JHVST on behalf of the Acquiring Fund at any
time prior to the Effective Time of the Reorganization. In addition, either
party may at its option, at any time prior to the Effective Time of the
Reorganization, whether before or after approval of this Plan by the
shareholders of the Acquired Fund, without liability on the part of any party
hereto, its Trustees, officers or shareholders, terminate this Plan:
(i) because of a breach by the other of any material representation,
warranty, covenant or agreement contained herein or to be performed
prior to the Effective Time of the Reorganization;
(ii) because of a material condition herein expressed to be precedent to the
obligations of the terminating party which has not been fulfilled and
has not been waived by the terminating party;
(iii) by resolution of the Board of Trustees of MIT if it should determine in
good faith that proceeding with this Plan is not in the best interests
of the Acquired Fund, its shareholders and contract owners whose
contracts are funded by shares of the Acquired Fund; or
(iv) by resolution of the Board of Trustees of JHVST if it should determine
in good faith that proceeding with this Plan is not in the best
interests of the Acquiring Fund, its shareholders and contract owners
whose contracts are funded by shares of the Acquiring Fund.
(d) Unless MIT on behalf of the Acquired Fund and JHVST on behalf of the
Acquiring Fund shall otherwise determine by written instrument, this Plan shall
terminate without liability as of the close of business on September 1, 2004 if
the Effective Time of the Reorganization is not on or prior to such date.
(e) Survival. No representations, warranties or covenants in or pursuant to
this Plan, except for the provisions of Section 5(f) and Section 9 of this Plan,
shall survive the Reorganization.
9. EXPENSES
The expenses of the Reorganization will be borne by the Acquired Fund and
the Acquiring Fund, with each Fund bearing one-half of the total expenses. Such
expenses include, without limitation, (i) expenses incurred in connection with
the entering into and the carrying out of the provisions of this Plan; (ii)
expenses associated with the preparation and filing of the Registration
Statement (other than any registration fees payable to the Commission in respect
of the registration of the Acquiring Fund Shares registered thereby, which shall
be payable by the Acquiring Fund); (iii) fees and expenses of preparing and
filing such forms as are necessary under any applicable state
30
securities laws in connection with the Reorganization; (iv) postage; (v)
printing; (vi) accounting fees; (vii) legal fees and (viii) solicitation costs
relating to the Reorganization.
10. RELIANCE
All covenants and agreements made under this Plan shall be deemed to have
been material and relied upon by MIT on behalf of the Acquired Fund and JHVST on
behalf of the Acquiring Fund notwithstanding any investigation made by such
party or on its behalf.
11. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
(a) The section and paragraph headings contained in this Plan are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Plan.
(b) This Plan may be executed in any number of counterparts, each of which
shall be deemed an original.
(c) This Plan shall be governed by and construed in accordance with the
laws of The Commonwealth of Massachusetts.
(d) This Plan shall bind and inure to the benefit of MIT, the Acquired
Fund, JHVST and the Acquiring Fund and their respective successors and assigns,
but no assignment or transfer hereof or of any rights or obligations hereunder
shall be made by either party without the written consent of the other party.
Nothing herein expressed or implied is intended or shall be construed to confer
upon or give any person, firm or corporation, other than the parties hereto and
their respective successors and assigns, any rights or remedies under or by
reason of this Plan.
(e) All persons dealing with MIT or JHVST must look solely to the property
of MIT or JHVST, respectively, for the enforcement of any claims against MIT or
JHVST, as none of the Trustees, officers, agents or shareholders of MIT or JHVST
assumes any personal liability for obligations entered into on behalf of MIT or
JHVST, respectively. No series of MIT or JHVST shall be liable for claims
against, respectively, any other series of MIT or JHVST.
IN WITNESS WHEREOF, the undersigned have executed this Plan as of the date
first above written.
MANUFACTURERS INVESTMENT TRUST
on behalf of the Acquired Fund
BY: /s/ JAMES D. GALLAGHER
----------------------------------
Name: James D. Gallagher
Title: President
JOHN HANCOCK VARIABLE SERIES TRUST I
on behalf of the Acquiring Fund
BY: /s/ MICHELE G. VAN LEER
----------------------------------
Name: Michele G. Van Leer
Title: Chairman and Chief Executive Officer
31
APPENDIX A
THE ACQUIRED FUND:
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
The following discussion sets forth information regarding the performance
of the Acquired Fund for the period ended December 31, 2003. There are several
ways to evaluate a fund's historical performance. One can look at the total
percentage change in value, the average annual percentage change or the growth
of a hypothetical $10,000 investment. WITH RESPECT TO ALL PERFORMANCE
INFORMATION PRESENTED, IT IS IMPORTANT TO UNDERSTAND THAT PAST PERFORMANCE DOES
NOT GUARANTEE FUTURE RESULTS. RETURN AND PRINCIPAL FLUCTUATE, AND SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE TABLE The following performance table for the Acquired Fund
shows two types of total return information: CUMULATIVE AND AVERAGE ANNUAL TOTAL
RETURNS. A CUMULATIVE TOTAL RETURN is an expression of a fund's total change in
share value in percentage terms over a set period of time -- one, five and ten
years (or since the fund's inception if less than the applicable period). An
AVERAGE ANNUAL TOTAL RETURN takes the fund's cumulative total return for a time
period greater than one year and shows what would have happened if the fund had
performed at a constant rate each year. THE TABLE SHOWS ALL CUMULATIVE AND
AVERAGE ANNUAL TOTAL RETURNS, NET OF FEES AND EXPENSES OF MIT, BUT DO NOT
REFLECT THE INSURANCE (SEPARATE ACCOUNT) EXPENSES (INCLUDING A POSSIBLE
CONTINGENT DEFERRED SALES CHARGE) OF THE VARIABLE ANNUITY AND VARIABLE LIFE
PRODUCTS THAT INVEST IN MIT. IF THESE WERE INCLUDED, PERFORMANCE WOULD BE LOWER.
GRAPH -- CHANGE IN VALUE OF $10,000 INVESTMENT AND COMPARATIVE INDICES. The
following performance graph for the Acquired Fund shows the change in value of a
$10,000 investment over the life of the Fund. The Fund's performance is compared
with the performance of one or more broad-based securities indices as a
"benchmark." All performance information includes the reinvestment of dividends
and capital gain distributions, as well as the deduction of ongoing management
fees and the Fund's operating expenses. The benchmark used for comparison is
unmanaged and includes reinvestment of dividends and capital gains
distributions, if any, but does not reflect any fees or expenses.
PORTFOLIO MANAGER'S COMMENTARY. Following the performance table and graph
for the Acquired Fund is a commentary by the portfolio manager regarding the
Fund's performance during the period ended December 31, 2003. The views
expressed are those of the portfolio manager as of that date and are subject to
change based on market and other conditions. Information about the Fund's
holdings, asset allocation or country diversification is historical and is no
indication of future portfolio composition, which will vary.
"MSCI" and "EAFE" are trademarks of Morgan Stanley & Co. Incorporated.
The following information regarding the Acquired Fund was included in MIT's
Annual Report to Shareholders for 2003.
INTERNATIONAL INDEX TRUST
("ACQUIRED FUND")
A-1
INVESTMENT OBJECTIVE To achieve the approximate aggregate total return of a
& POLICIES: foreign equity market index by attempting to track the
performance of the Morgan Stanley Europe Australasia Far
East Free Index (the MSCI EAFE Index). The portfolio invests
at least 80% of its net assets in (a) the common stocks that
are included in the MSCI EAFE Index and (b) securities
(which may or may not be included in the MSCI EAFE Index)
that MFC believes as a group will behave in a manner similar
to the index.
SUBADVISER: MFC Global Investment Management (U.S.A.) Limited
PORTFOLIO MANAGERS: Carson Jen and Narayan Ramani
INCEPTION DATE: May 1, 2000
CHANGE IN VALUE OF $10,000 INVESTMENT AND COMPARATIVE INDICES
[INTERNATIONAL INDEX TRUST PERFORMANCE GRAPH]
INTERNATIONAL INDEX TRUST SERIES I MSCI EAFE INDEX
---------------------------------- ---------------
Apr. 2000 10000.00 10000.00
9784.00 9715.00
Jun. 2000 10112.00 10097.00
9704.00 9675.00
9776.00 9761.00
Sep. 2000 9320.00 9288.00
9080.00 9071.00
8712.00 8732.00
Dec. 2000 9016.00 9045.00
9000.00 9040.00
8318.00 8363.00
Mar. 2001 7726.00 7810.00
8294.00 8357.00
7994.00 8069.00
Jun. 2001 7686.00 7742.00
7531.00 7602.00
7345.00 7411.00
Sep. 2001 6598.00 6662.00
6752.00 6832.00
6963.00 7085.00
Dec. 2001 6996.00 7127.00
6610.00 6749.00
6667.00 6796.00
Mar. 2002 7037.00 7167.00
7053.00 7219.00
7136.00 7317.00
Jun. 2002 6848.00 7029.00
6175.00 6335.00
6142.00 6322.00
Sep. 2002 5477.00 5645.00
5756.00 5949.00
6011.00 6220.00
Dec. 2002 5796.00 6011.00
5546.00 5760.00
5396.00 5629.00
Mar. 2003 5280.00 5522.00
5780.00 6070.00
6097.00 6443.00
Jun. 2003 6238.00 6603.00
6355.00 6764.00
6497.00 6928.00
Sep. 2003 6671.00 7143.00
7038.00 7589.00
7180.00 7759.00
Dec. 2003 7662.00 8365.00
PERFORMANCE TABLE**
Average Annual Total Return Cumulative Total Return
Since Since
Periods Ended December 31, 2003 1 Year Inception Inception
MSCI EAFE Index 39.17% -4.64% -16.35%
International Index Trust Series I 32.18% -7.00% -23.38%
International Index Trust Series II+++ 32.12% 7.25% 14.48%
International Index Trust Series III*** 15.57%
+++ Series II inception date: January 28, 2002
** Performance does not reflect any insurance related charges. If these charges
were reflected, performance would be lower. Past performance does not
predict future results. Total return would have been lower had operating
expenses not been reduced.
*** Series III inception date: September 5, 2003.
PORTFOLIO MANAGER'S COMMENTARY
PERFORMANCE: For the year 2003, the International Index Trust Series I returned
+32.18%, underperforming the +39.17% return of the MSCI EAFE Index.
ENVIRONMENT: All of the MSCI EAFE Index sectors were in the positive territory
for 2003. Information Technology was the best performer, followed by
Industrials, Materials and Financials, all of which returned high double-digit
gains. Energy, Consumer Staples and Utilities were the worst performing sectors.
Likewise, most countries in the Index had gains for 2003. Greece was the best
performing country, gaining about 67% in value. Sweden, Spain, Germany, New
Zealand and Denmark also had high double-digit gains. Finland was the worst
performer, followed by the Netherlands.
MSCI rebalanced its EAFE Index in May and again in November. The rebalancing
resulted in no significant country or sector weight changes.
OUTLOOK: In 2003, the European Central Bank cut its benchmark interest rate from
2.75% to 2.0% in June. Similarly, the Bank of England cut its rate from 4.0% to
3.5% in July. A corporate profit recovery is underway in Japan, driven in part
through sales growth but largely due to the effects of restructuring.
lix
APPENDIX B
THE ACQUIRING FUND:
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE
During 2003, the subadviser to the Acquiring Fund was Independence
Investment LLC. SSgA Fund Management, Inc. ("SSgA") succeeded Independent
Investment LLC as subadviser effective March 29, 2004.
The following information regarding the Acquiring Fund appeared in the
Acquiring Fund's Annual Report to Shareholders for 2003.
Inception: May 2, 1988
- --------------------------------------------------------------------------------
INTERNATIONAL EQUITY INDEX FUND Portfolio Manager:
INDEPENDENCE INVESTMENT LLC D. Nolan
- --------------------------------------------------------------------------------
.. In 2003, the Fund returned 41.99%, underperforming its customized
benchmark.
.. On November 1st, the Fund's benchmark was changed from a primarily GDP
weighted benchmark to a market capitalization weighted benchmark (the MSCI
All Country World Free ex-US Index). This index provides broad exposure to
both developed and emerging market equities.
.. The Fund's investment objective is to track the long-term performance of
broad-based equity indices of foreign companies in developed and emerging
markets as measured by the MSCI All Country World Free ex-US Index.
.. The manager seeks to track the performance of its benchmark by investing in
a representative sample of issues selected through proprietary quantitative
techniques. Issues are selected to best match the risk characteristics of
the index, including country and sector exposures.
[CHART]
Line Chart
Historical Fund Return
$10,000
Investment made 12/31/93
(10-Year Period)
International
Equity Index International Equity
Fund Index Benchmark(1)
------------- ----------------------
12/31/1993 10,000.00 10,000.00
1/31/1994 13,320.64 14,421.38
2/28/1994 13,165.42 14,383.89
3/31/1994 12,478.86 13,766.82
4/29/1994 12,713.92 14,354.66
5/31/1994 12,862.54 14,275.71
6/30/1994 12,530.95 14,481.28
7/29/1994 12,819.11 14,623.20
8/31/1994 13,412.54 14,972.69
9/30/1994 13,133.71 14,504.05
10/31/1994 13,396.96 14,989.93
11/30/1994 12,520.14 14,273.41
12/30/1994 12,401.68 14,366.19
1/31/1995 11,708.88 13,817.40
2/28/1995 11,908.32 13,781.48
3/31/1995 12,340.79 14,645.58
4/28/1995 12,712.55 15,200.64
5/31/1995 12,972.79 15,022.80
6/30/1995 12,847.88 14,762.90
7/31/1995 13,561.39 15,685.58
8/31/1995 13,175.93 15,091.10
9/29/1995 13,362.66 15,389.90
10/31/1995 13,130.99 14,980.53
11/30/1995 13,191.91 15,401.48
12/29/1995 13,395.71 16,025.24
1/31/1996 13,606.81 16,094.15
2/29/1996 13,761.02 16,152.09
3/29/1996 13,892.48 16,499.36
4/30/1996 14,407.05 16,982.79
5/31/1996 14,260.73 16,673.71
6/28/1996 14,292.36 16,772.08
7/31/1996 13,686.10 16,285.69
8/30/1996 13,793.59 16,324.78
9/30/1996 14,051.46 16,762.28
10/31/1996 13,964.56 16,594.66
11/29/1996 14,589.37 17,258.44
12/31/1996 14,626.33 17,040.99
1/31/1997 14,373.63 16,447.96
2/28/1997 14,427.57 16,721.00
3/31/1997 14,159.30 16,786.21
4/30/1997 14,260.03 16,878.53
5/30/1997 15,461.21 17,980.70
6/30/1997 16,261.79 18,976.83
7/31/1997 16,773.41 19,288.05
8/29/1997 14,945.68 17,851.09
9/30/1997 16,026.08 18,854.32
10/31/1997 13,854.46 17,410.08
11/28/1997 13,849.83 17,235.98
12/31/1997 13,891.23 17,391.11
1/31/1998 13,901.32 18,191.10
2/27/1998 14,968.54 19,362.60
3/31/1998 15,575.41 19,962.84
4/30/1998 15,991.94 20,124.54
5/29/1998 16,086.96 20,414.34
6/30/1998 16,281.99 20,610.31
7/31/1998 16,414.69 20,884.43
8/31/1998 14,326.78 18,138.13
9/30/1998 13,881.02 17,637.52
10/30/1998 15,383.40 19,605.86
11/30/1998 16,129.04 20,627.33
12/31/1998 16,783.26 21,462.74
1/29/1999 16,820.14 21,490.64
2/26/1999 16,250.77 20,820.13
3/31/1999 17,103.05 21,921.51
4/30/1999 17,757.57 22,807.14
5/28/1999 16,897.58 21,616.61
6/30/1999 17,768.81 22,708.25
7/30/1999 18,185.56 23,273.68
8/31/1999 18,351.79 23,436.60
9/30/1999 18,481.01 23,724.87
10/29/1999 19,100.24 24,514.91
11/30/1999 19,943.20 25,529.83
12/31/1999 21,964.24 28,090.47
1/31/2000 20,675.58 26,714.03
2/29/2000 21,380.17 27,641.01
3/31/2000 21,956.62 28,398.37
4/28/2000 20,545.20 26,566.68
5/31/2000 20,148.57 25,929.08
6/30/2000 20,856.49 27,041.44
7/31/2000 19,865.47 25,683.96
8/31/2000 20,057.16 25,956.21
9/29/2000 19,086.01 24,648.01
10/31/2000 18,456.28 23,839.56
11/30/2000 17,652.71 22,776.31
12/31/2000 18,138.35 23,336.61
1/31/2001 18,503.20 23,852.35
2/28/2001 17,218.76 22,230.39
3/30/2001 16,015.75 20,729.84
4/30/2001 17,113.36 22,068.99
5/31/2001 16,571.05 21,395.88
6/30/2001 16,002.68 20,636.33
7/31/2001 15,594.05 20,097.72
8/31/2001 15,226.40 19,599.30
9/28/2001 13,458.20 17,345.38
10/31/2001 13,786.89 17,815.44
11/30/2001 14,416.76 18,597.54
12/31/2001 14,456.93 18,664.49
1/31/2002 13,771.57 17,796.59
2/28/2002 13,950.25 17,983.45
3/29/2002 14,793.86 18,994.12
4/30/2002 14,910.47 19,233.45
5/31/2002 15,106.58 19,562.34
6/28/2002 14,514.59 18,773.98
7/31/2002 13,088.04 16,894.70
8/31/2002 13,076.08 16,909.91
9/28/2002 11,585.10 14,970.34
10/31/2002 12,027.79 15,627.54
11/30/2002 12,663.02 16,460.49
12/31/2002 12,261.97 15,937.04
1/31/2003 8,991.13 11,630.86
2/28/2003 8,818.76 11,404.06
3/29/2003 8,574.05 11,074.48
4/30/2003 9,388.30 12,148.71
5/31/2003 9,962.63 12,948.09
6/28/2003 10,329.08 13,427.17
7/31/2003 10,636.48 13,872.95
8/31/2003 11,017.53 14,357.12
9/28/2003 11,316.09 14,767.73
10/31/2003 12,005.35 15,758.65
11/30/2003 12,268.41 16,102.18
12/31/2003 13,181.59 17,330.78
Value on 12/31/03:
- ------------------
$13,182 International Equity Index Fund
$17,331 International Equity Index Benchmark(1)
MORNINGSTAR
CATEGORY+:
.. Foreign Large Blend
MORNINGSTAR
RISK+:
.. Average (VL/VUL)
.. Average (VA)
MORNINGSTAR
RATING+:
.. *****(VL/VUL)
.. *****(VA)
TOP TEN HOLDINGS (as of December 31, 2003)
% of
Assets
------
BP Amoco plc 2.1%
Vodafone AirTouch plc 1.9%
HSBC Holdings plc 1.9%
GlaxoSmithKline plc 1.5%
Total Fina SA 1.5%
Royal Dutch Petroleum Co. 1.4%
Novartis AG 1.2%
Nestle SA 1.1%
Toyota Motor Corp. 1.0%
Nokia Oyj 1.0%
AVERAGE ANNUAL TOTAL RETURNS*
International International Equity
Equity Index Fund Index Benchmark(1)
----------------- --------------------
1 Year 41.99% 44.57%
3 Years -1.36 -0.43
5 Years 0.74 1.43
10 Years 2.80 5.65
DIVERSIFICATION BY REGION AND COUNTRY (3)
(as of December 31, 2003)
% of
Assets
------
Europe (excluding U.K.) 38.4%
United Kingdom (U.K.) 22.3%
Japan 18.5%
Pacific Basin (excluding Japan) 6.8%
Emerging Markets 6.4%
Canada 5.0%
United States 2.7%
DIVERSIFICATION BY REGION(4)
Developed Markets 91%
Emerging Markets 9%
(1) The International Equity Benchmark represents the MSCI EAFE from May 1988
to April 1998 and then MSCI EAFE GDP weighted from May 1998 to June 1999
and then 90% MSCI EAFE GDP/10% MSCI Emerging Markets Free from July 1999 to
October 2003 and now the MSCI All Country World Free excluding U.S. from
November 2003 to present.
* Total returns are for the period ended December 31, 2003. Returns represent
past performance, assume reinvestment of all distributions, and are not
indicative of future performance. Investment returns and principal value of
fund shares will fluctuate so that shares, when redeemed, may be worth more
or less than their original cost. The performance of the fund on this page
is reported net of Trust level charges (i.e. investment management fees and
operating expenses). It does not reflect expense and charges of the
applicable separate accounts and variable products, all of which vary to a
considerable extent and are described in your product prospectus. There are
special risks associated with international investing, including currency
fluctuations, political and economic instability, foreign taxation and
different accounting standards, as outlined in the current prospectus.
Performance would be lower if expenses and charges of the separate accounts
and products were reflected.
+ Source: MorningStar, Inc. Data as of 12/31/03. VL represents Variable Life
subaccounts, VUL represents Variable Universal Life subaccounts and VA
represents Variable Annuity subaccounts Hancock VL/VUL subaccounts were
rated against 367 VL/VUL subaccounts and 570 VA subaccounts in the
Morningstar Foreign Large Blend category. This represents the Morningstar 3
year rating.
(3) Calculations based upon country in which security is traded (listed).
(4) Calculations based upon country in which security is domiciled.
THE MANUFACTURERS LIFE INSURANCE COMPANY (U.S.A.)]
[THE MANUFACTURERS LIFE INSURANCE COMPANY OF NEW YORK]
VOTING INSTRUCTIONS FORM
Voting pursuant to these instructions will be as specified. If no
specification is made as to an item, voting will be for such item. A voting
instruction form is provided for the International Index Trust in which your
contract values were invested as of April 20, 2004. Please sign, date and return
the voting instruction form in the enclosed postage-paid envelope.
Voting instructions must be received by June 17, 2004 to be voted at the
Meeting to be held on June 18, 2004.
International Index Trust
These voting instructions are solicited by [The Manufacturers Life
Insurance Company (U.S.A.)] [The Manufacturers Life Insurance Company of New
York] in connection with a solicitation of proxies by the Board of Trustees of
Manufacturers Investment Trust.
The undersigned hereby instructs [The Manufacturers Life Insurance Company
(U.S.A.)] [The Manufacturers Life Insurance Company of New York] to vote the
shares of Manufacturers Investment Trust (the "Trust") attributable to his or
her variable annuity or variable life contract at the Special Meeting of
Shareholders to be held at 73 Tremont Street, Boston, Massachusetts 02108 at
10:00 a.m., Boston time, June 18, 2004, and any adjournments thereof, as
indicated below.
Date: _____________, 2004
Please sign in box below:
If a contract is held jointly, each contract owner should sign. If only one
signs, his or her signature will be binding. If the contract owner is a
corporation, the President or a Vice President should sign in his or her own
name, indicating title. If the contract owner is a partnership, a partner should
sign in his or her own name, indicating that he or she is a "Partner." If the
contract owner is a trust, the trustee should sign in his or her own name,
indicating that he or she is a "Trustee."
- -------------------------------------------
Signature(s), Title(s), if applicable
Indicate your vote below by filling in the appropriate boxes
using blue or black ink or a number 2 pencil.
Please do not use fine point pens.
- ------------------------------------------------
This voting instructions form, if properly executed, will be voted in the
manner directed by the contract owner. If no direction is made, this voting
instructions form will be voted "For" all proposals. Please refer to the Proxy
Statement/Prospectus for a discussion of the proposals.
For Against Abstain
1. Approval of Agreement and Plan of
Reorganization. [_] [_] [_]
2. To transact such other business as may
properly come before the Meeting.
- ------------------------------------------------
Please mark your Voting Instructions Form, date and sign it on the reverse
side, and return it promptly in the accompanying envelope which requires no
postage if mailed in the United States.
PART B
INFORMATION REQUIRED IN A
STATEMENT OF ADDITIONAL INFORMATION
JOHN HANCOCK
VARIABLE SERIES TRUST I
197 Clarendon Street
Boston, Massachusetts 02117
STATEMENT OF ADDITIONAL INFORMATION
Dated: May __, 2004
This Statement of Additional Information is not a prospectus but should
be read in conjunction with the Proxy Statement/Prospectus dated May __, 2004
for the Special Meeting of Shareholders of the International Index Trust, a
separate series of the Manufacturers Investment Trust ("MIT"), to be held on
June 18, 2004. The Proxy Statement/Prospectus describes the proposed
reorganization providing for the transfer of all of the assets and liabilities
of the MIT International Index Trust to, and in exchange for Series I and Series
II shares of, the International Equity Index Fund, a separate series of the John
Hancock Variable Series Trust I ("JHVST"). A copy of the Proxy
Statement/Prospectus may be obtained without charge by writing to JHVST at the
address above or by calling toll free (800) 576-2227.
This Statement of Additional Information incorporates by reference the
following documents (or designated portions thereof) that accompany it and have
been filed with the Securities and Exchange Commission (SEC):
(1) The financial statements of the International Equity Index Fund of JHVST
appearing in its Annual Report to Shareholders for the year ended December 31,
2003, and the report of Ernst & Young LLP, independent auditors, appearing
therein; and
(2) The financial statements of MIT appearing in its Annual Report to
Shareholders for the year ended December 31, 2003, and the report of
PricewaterhouseCoopers, LLP, independent accountants, appearing therein.
TABLE OF CONTENTS
Statement of Additional Information of JHVST, dated May 1, 2004 (to be filed by
amendment).
MIT International Index Trust and JHVST International Equity Index Fund Pro
Forma Financial Statements
Pro Forma Combining Statement of Assets and
Liabilities -- December 31, 2003 (Unaudited)
Pro Forma Combining Statement of Operations -- For the
Year Ended December 31, 2003 (Unaudited)
Pro Forma Combining Schedule of Portfolio
Investments -- December 31, 2003 (Unaudited)
MIT International Index Trust and JHVST International
Equity Index Fund Pro Forma Financial Statements
The Pro Forma Combining Statement of Operations set out below provides
information about the impact of the proposed Reorganization by indicating how
the Reorganization might have affected the Funds' results of operations if the
Reorganization had been consummated as of December 31, 2002. The Pro Forma
Combining Statement of Assets and Liabilities and Pro Forma Combining Schedule
of Portfolio Investments show how the Reorganization might have affected the
Funds' assets and liabilities if it had been consummated as of December 31,
2003. In each case the combined results give effect to the pro-forma adjustments
described in the related footnotes.
PRO FORMA COMBINING STATEMENT OF ASSETS AND LIABILITIES
December 31, 2003
(Unaudited)
(000's Omitted)
VST MIT
International International Pro forma
Equity Index Index Trust Adjustment Combined
---------------------------------------------------------
Assets:
Investments in securities, at value $ 167,180 $ 108,882 $ 276,062
(Cost: Target Fund - $142,128
Acquiring Fund - $87,510)
Foreign currency at value 47 17 64
Receivable for:
Investments sold 1 4 5
Fund shares sold 80 94 174
Income receivable 242 88 330
Futures contracts variation margin 9 5 14
Forward foreign currency exchange
contracts sold 74 74
Foreign tax withholding reclaims 22 22
Other assets 7 1 8
---------------------------------------------------------
Total assets 167,639 109,113 276,753
---------------------------------------------------------
LIABILITIES
Payables for:
Collateral for securities on loan 8,571 9,718 18,289
Due to adviser 1 1
Forward foreign currency exchange
contracts purchased 12 12
Other liabilities 20 18 38
----------- ----------- -----------
Total liabilities 8,603 9,737 18,340
Net assets $ 159,037 $ 99,376 $ 258,413
=========== =========== ===========
Composition of net assets:
Capital paid-in $ 169,314 $ 105,335 $ 274,649
Accumulated net realized loss on investments,
futures and foreign currency transactions (22,996) (4,586) (27,582)
Undistributed net investment loss (421) (415) (836)
Net unrealized appreciation (depreciation) of:
Investments 13,002 (1,268) 11,734
Futures 79 195 274
Translation of assets and liabilities in foreign currencies 59 6 65
Capital shares at par value $.01 109 109
----------- ----------- -----------
Net assets $ 159,037 $ 99,376 $ 258,413
=========== =========== ===========
Outstanding Shares:
NAV Shares $11,508,157 $ $11,508,157
Series I Shares - A 5,947,684 5,947,684
Series II Shares - B 1,243,084 1,243,084
Series I Shares - MIT International Index Trust - A $ 9,056,146
Series II Shares - MIT International Index Trust - B 1,891,983
Net asset value per share:
NAV Shares $ 13.82 $ 13.82
Series I Shares - A - $ 13.82
Series II Shares - B - $ 13.82
Series I Shares - MIT International Index Trust - A $ 9.08
Series II Shares - MIT International Index Trust - B 9.08
A - Series I of the Acquired Fund are exchanged for Series I of the Acquiring
Fund upon consummation of the reorganization. Initial per share values of Series
I shares are presumed to equal that of NAV Shares.
B - Series II of the Acquired Fund are exchanged for Series II of the Acquiring
Fund upon consummation of the reorganization. Initial per share values of Series
II shares are presumed to equal that of NAV Shares.
PRO FORMA COMBINING STATEMENT OF OPERATIONS
December 31, 2003
(Unaudited)
(000's Omitted)
VST International MIT International Pro forma
Equity Index Index Trust Adjustments Combined
---------------------------------------------------------------
Investment Income:
Interest $ 57 $ 100 $ $ 157
Dividends 2,738 1,739 4,477
Securities lending 146 41 187
Less Foreign taxes withheld (182) (182)
------------ ----------- --------
Total investment income 2,941 1,698 4,639
Expenses:
Investment advisory fee 214 288 (231) A 271
Custodian fees 253 18 (244) B 27
Fund administration fees 8 (8) B -
Audit & Legal fees 25 15 (10) B 30
Printing & mailing fees 10 6 (3) B 13
Registration and filing fees 1 (1) B -
Trustees' fees 4 1 5
Other fees 10 2 (1) B 11
Distribution fee for Series I 91 91
Distribution fee for Series II 40 40
------------ ----------- --------- --------
Total expenses 516 470 488 C
Less expenses reimbursed (189) (15) --
------------ ----------- --------- --------
Net expenses 327 455 (498) 488
------------ ----------- --------
Net investment income 2,614 1,243 4,151
------------ ----------- --------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) on:
Investments (7,135) (133) (7,268)
Financial futures contracts 282 1,406 1,688
Foreign currency transactions 516 (277) 239
Change in unrealized appreciation
(depreciation) on:
Investments 50,873 21,167 72,040
Futures 171 193 364
Translation of assets and
liabilities in foreign currencies (4) (9) (13)
------------ ----------- --------
Net realized and unrealized gain 44,703 22,347 67,050
------------ ----------- --------
Net increase in net assets
resulting from operations $ 47,317 $ 23,590 $ 71,201
============ =========== ========
A - Based on contract in effect for the Acquiring Fund.
B - Decreases reflect the elimination of duplicative expenses achieved by
merging the funds, and reduced custodian fees for the Acquiring Fund that became
effective April 1, 2004.
C - One time transaction fees relating directly to the Reorganization were not
considered in the proforma statement of operations. Estimated one time
transaction fees are $75,000 for each fund or $150,000 in total.
PRO FORMA COMBINING SCHEDULE OF PORTFOLIO INVESTMENTS
December 31, 2003 (Unaudited)
The Schedule of Investments is a complete list of all the securities owned by
the V.S.T. International Equity Index and the MIT International Index Trust,
combined on December 31, 2003.
-------------------------------------------------------------------------------------
VST INTERNATIONAL EQUITY INDEX MIT INTERNATIONAL INDEX TRUST PRO FORMA COMBINED
-------------------------------------------------------------------------------------
MARKET VALUE NUMBER OF MARKET VALUE NUMBER OF MARKET VALUE
Name of Issuer SHARES (000'S SHARES OR (000'S SHARES OR (000'S
OMITTED) PAR VALUE OMITTED) PAR VALUE OMITTED)
-------------------------------------------------------------------------------------
COMMON STOCK
Australia - 3.9% #
Alumina, Ltd. * 19,300 95 13,123 65 32,423 160
Amcor, Ltd. * 10,060 63 10,060 63
AMP, Ltd. 50,472 190 17,632 66 68,104 256
Ansell, Ltd. * 11,800 57 2,243 11 14,043 68
Aristocrat Leisure, Ltd. * 2,388 3 2,388 3
Austrailia Gas Light Company, Ltd. * 5,101 43 5,101 43
Australia and New Zealand Bank Group Ltd. * 20,981 279 20,981 279
Australian Stock Exchange, Ltd. * 1,311 17 1,311 17
BHP Steel * 33,357 141 9,229 39 42,586 180
Boral, Ltd. * 6,916 26 6,916 26
Brambles Industries, Ltd. * (a) 11,480 46 11,480 46
Broken Hill Proprietary Co., Ltd. * 78,691 722 43,744 401 122,435 1,123
Centro Props Group * 6,710 20 6,710 20
CFS Gandel Retail Trust * 13,880 14 13,880 14
Coca-Cola Amatil, Ltd. * 5,717 27 5,717 27
Cochlear, Ltd. * 563 9 563 9
Coles Myer, Ltd. * 23,600 134 12,639 72 36,239 206
Commonwealth Bank of Australia 27,670 614 14,641 325 42,311 939
Commonwealth Property Office Fund * 16,430 14 16,430 14
Computershare, Ltd. * 4,926 12 4,926 12
CSL, Ltd. * 2,600 35 1,843 25 4,443 60
CSR, Ltd. 65,000 91 9,889 14 74,889 105
David Jones, Ltd. * 2,251 2 2,251 2
Deutsche Office Trust * 14,906 12 14,906 12
Foster's Brewing Group, Ltd. * 39,000 132 25,387 86 64,387 218
Futuris Corp., Ltd. * 6,834 8 6,834 8
General Property Trust 168,892 380 22,880 51 191,772 431
Harvey Norman Holding, Ltd. * 5,707 13 5,707 13
HHG plc * 50,472 36 50,472 36
Iluka Resources, Ltd. * 2,500 8 2,500 8
Investa Property Group * 15,352 23 15,352 23
James Hardie Industries NV * 5,490 28 5,490 28
John Fairfax Holdings, Ltd. * 10,236 27 10,236 27
Leighton Holdings * 1,493 13 1,493 13
Lend Lease Corp. 10,600 80 4,246 32 14,846 112
Lion Nathan, Ltd. * 3,000 14 3,000 14
Macquarie Bank, Ltd. * 2,499 67 2,499 67
Macquarie Goodman * 15,874 20 15,874 20
Macquarie Infrastructure Group * 21,866 56 21,866 56
Mayne Nickless, Ltd. * 8,985 22 8,985 22
Mirvac Group * 7,935 26 7,935 26
National Australia Bank, Ltd. 31,556 712 17,545 396 49,101 1,108
Newcrest Mining, Ltd. * 3,890 38 3,890 38
News Corp., Ltd. 31,113 281 17,031 154 48,144 435
NRMA Insurance Group, Ltd. * 20,058 64 20,058 64
OneSteel, Ltd. 37,275 57 5,172 8 42,447 65
Orica, Ltd. 8,400 88 3,066 32 11,466 120
Origin Energy, Ltd. * 8,130 29 8,130 29
PaperlinkX, Ltd. * 4,733 18 4,733 18
Patrick Corp., Ltd. * 1,769 19 1,769 19
Publishing & Broadcasting, Ltd. * 1,585 15 1,585 15
QBE Insurance Group, Ltd. * 30,618 244 7,711 62 38,329 306
Rinker Group Ltd. 18,000 89 10,937 54 28,937 143
Rio Tinto, Ltd. 5,600 157 3,619 101 9,219 258
Santos, Ltd. * 39,200 203 6,535 34 45,735 237
Sonic Healthcare, Ltd. * 2,854 15 2,854 15
Sons Of Gwalia, Ltd. * 670 2 670 2
Southcorp, Ltd. * 6,901 14 6,901 14
Stockland 56,157 221 13,903 55 70,060 276
Suncorp-Metway, Ltd. * 6,181 58 6,181 58
Tab, Ltd. * 5,702 20 5,702 20
Tabcorp Holdings, Ltd. 16,400 139 4,739 40 21,139 179
Telstra Corp. * 43,000 156 25,507 93 68,507 249
Toll Holdings, Ltd. * 2,546 16 2,546 16
Transurban Group * 5,224 18 5,224 18
Wesfarmers, Ltd. * 4,374 87 4,374 87
Westfield Holdings, Ltd. * 5,050 53 5,050 53
Westfield Trust 142,560 382 25,433 68 167,993 450
Westpac Banking Corp., Ltd. * 31,200 376 20,984 253 52,184 629
WMC Resorces, Ltd. * 19,300 82 13,039 55 32,339 137
Woodside Petroleum, Ltd. * 5,389 60 5,389 60
Woolworths, Ltd. * 16,300 145 11,903 106 28,203 251
------- -------- --------
6,039 4,136 10,175
Austria - 0.2% #
Bank Austria Creditanstalt * 2,049 105 469 24 2,518 129
Bohler Uddeholm AG 1,600 108 43 3 1,643 111
BWT AG 2,000 37 2,000 37
Erste Bank AG * 658 81 359 44 1,017 125
Flughafen Wien AG 2,178 102 119 5 2,297 107
Immofinanz Immobiien Anlage AG * 3,481 28 3,481 28
Mayr-Melnhof Karton AG * 68 8 68 8
Oesterreichische Elektrizitaets AG, Class A * 70 8 70 8
OMV AG * 154 23 154 23
RHI AG * (a) 94 2 94 2
Telekom Austria AG * 2,323 29 2,323 29
VA Technologie AG * 71 2 71 2
Voestalpine AG * 284 12 284 12
Wienerberger Baustoffindustrie AG * 300 8 300 8
------- -------- --------
433 196 629
Belgium - 1.0% #
Agfa Gevaert NV * 1,360 39 1,360 39
Barco NV * 120 11 120 11
Bekaert NV 890 57 198 13 1,088 70
Cofinimmo SA * 40 5 40 5
Colruyt NV 970 93 190 18 1,160 111
Compagnie Maritime Belge SA 521 42 42 3 563 45
D' Ieteren SA 390 80 31 6 421 86
Delhaize SA 2,855 147 828 43 3,683 190
DEXIA * 7,205 124 7,439 128 14,644 252
Electrabel SA 254 80 348 109 602 189
Exmar SA * 521 22 521 22
Fortis * 13,470 271 11,983 241 25,453 512
GPE Bruxelles LAM 2,388 134 795 45 3,183 179
Interbew 5,301 141 1,734 46 7,035 187
KBC Bancassurance Holding NV 2,540 119 1,091 51 3,631 170
Mobistar SA * 249 14 249 14
NV Union Miniere SA 1,461 102 204 14 1,665 116
Omega Pharma SA * 277 9 277 9
Solvay SA 1,215 105 744 64 1,959 169
UCB SA * 3,900 147 1,078 41 4,978 188
-------- -------- --------
1,664 900 2,564
Brazil - 0.0% #
Aracruz Celulose SA - ADR * 1,500 55 1,500 55
Canada - 3.0% #
Abitibi Consolidated, Inc. * 9,699 78 9,699 78
Alcan Aluminum, Ltd. 5,575 261 5,575 261
ATI Technologies, Inc. 5,104 77 5,104 77
Bank of Montreal 8,151 337 8,151 337
Bank Nova Scotia Halifax * 8,445 430 8,445 430
Barrick Gold Corp. 9,441 214 9,441 214
BCE, Inc. 5,282 118 5,282 118
Biovail Corp. * 2,999 65 2,999 65
Bombardier, Inc. - Cl.B * 27,549 117 27,549 117
Brascan Corp. - Cl. A 3,244 100 3,244 100
Brookfield Properties Corp. * 3,034 88 3,034 88
Canadian National Railway Co. 3,587 228 3,587 228
Canadian Natural Resources, Ltd. 2,759 139 2,759 139
Canadian Pacific Railway 4,175 118 4,175 118
Canadian Tire, Ltd. - Cl.A * 2,230 68 2,230 68
Canadian Imperial Bank of Commerce 6,082 301 6,082 301
Celestica, Inc. * 4,634 70 4,634 70
Cognos, Inc. * 1,996 61 1,996 61
CP Ships, Ltd. Common 3,706 77 3,706 77
Dofasco, Inc. 2,944 82 2,944 82
Enbridge, Inc. 2,600 108 2,600 108
Encana Corp. 8,422 332 8,422 332
Fairmont Hotels Resorts, Inc. 2,964 81 2,964 81
Goldcorp, Inc. 4,202 67 4,202 67
Great West Lifeco, Inc. 2,299 81 2,299 81
Husky Energy, Inc. 4,971 90 4,971 90
Imperial Oil, Ltd. 2,992 133 2,992 133
Inco, Ltd. * 3,788 151 3,788 151
Investors Group, Inc. * 3,075 74 3,075 74
Loblaw Co., Ltd. 2,200 114 2,200 114
Magna International, Inc. 1,687 136 1,687 136
MDS, Inc. * 4,378 68 4,378 68
Molson Cos., Ltd. 2,729 76 2,729 76
National Bank of Canada 3,571 119 3,571 119
Nexen, Inc. 3,127 114 3,127 114
Noranda, Inc. 6,028 96 6,028 96
Nortel Networks Corp. 70,287 299 70,287 299
Petro Canada 4,246 210 4,246 210
Placer Dome, Inc. 7,841 141 7,841 141
Potash Corp. of Saskatchewan, Inc. * 1,128 98 1,128 98
Power Corp. Canada 3,014 113 3,014 113
Power Financial Corp. 2,532 97 2,532 97
Royal Bank of Canada 10,639 509 10,639 509
Shaw Communications, Inc. 5,140 80 5,140 80
Shell Canada, Ltd. 2,271 108 2,271 108
Sun Life Financial, Inc. * 10,490 262 10,490 262
Suncor Energy , Inc. 8,607 216 8,607 216
Talisman Energy, Inc. 2,702 154 2,702 154
Teck Cominco, Ltd. 5,191 88 5,191 88
Thomson Corp. 4,493 164 4,493 164
Transalta Corp. 4,891 70 4,891 70
TransCanada Corp. 8,180 176 8,180 176
Weston George, Ltd. 1,156 93 1,156 93
-------- --------
7,747 7,747
Czech Republic - 0.1% #
Ceske Energeticke Zavody AS 21,600 123 21,600 123
Komercni Banka AS * 900 85 900 85
-------- --------
208 208
Denmark - 0.6% #
A P Moller- Maersk A/S * 16 115 13 94 29 209
AS Det Ostasiatiske Kompagni * - 213 9 213 9
Bang & Olufsen AS - B Series * - 100 4 100 4
Carlsberg AS, B Shares * - 300 14 300 14
Coloplast AS, Class B * - 125 11 125 11
Danisco AS 3,050 136 550 25 3,600 161
Danske Bank 8,587 201 5,900 138 14,487 339
DSV * - 200 9 200 9
FLS Industries AS, B Shares * - 200 2 200 2
GN Store Nord AS * - 2,323 15 2,323 15
Group 4 Falck * - 800 16 800 16
H. Lundbeck AS * - 938 16 938 16
ISS AS 1,650 81 500 25 2,150 106
Kobenhavn Lufthavne * - 70 8 70 8
NEG Micon AS * - 200 3 200 3
NKT Holding * - 100 2 100 2
Novo Nordisk AS 3,148 128 2,977 121 6,125 249
Novozymes AS 4,450 162 626 23 5,076 185
Tele Danmark AS 4,150 150 1,650 59 5,800 209
Topdanmark AS * - 300 16 300 16
Vestas Wind Systems AS 2,500 41 1,268 21 3,768 62
William Demant Holdings * - 300 10 300 10
-------- ------ --------
1,014 641 1,655
Finland -1.3% #
Amer Group, Ltd. * 300 13 300 13
Asko Oyj * 300 9 300 9
Elisa Corporation * 1,650 22 1,650 22
Fortum Corp. * 4,000 41 4,000 41
KCI Konecranes Oyj * 200 7 200 7
Kesko Oyj * 700 12 700 12
Kone Corp. * 420 24 420 24
Metra Oyj, B Shares * 400 8 400 8
Metso Oyj * 1,300 16 1,300 16
Nokia Oyj * 91,721 1,584 55,955 967 147,676 2,551
Nokian Renkaat Oyj * - 100 7 100 7
Orion, Series B * - 500 11 500 11
Outokumpu Oyj * - 1,100 15 1,100 15
Pohjola Group PLC * - 200 5 200 5
Rautaruukki Oyj * - 800 6 800 6
Sampo Insurance Co. plc 4,700 49 3,200 33 7,900 82
Stora Enso Oyj * 7,903 106 7,259 98 15,162 204
Tietoenator Oyj 1,338 37 901 25 2,239 62
UPM-Kymmene Corp. 7,900 150 6,100 116 14,000 266
-------- ------ --------
1,926 1,435 3,361
France - 8.3% #
Accor SA 4,483 203 2,180 99 6,663 302
Air France * - 917 14 917 14
Air Liquide 1,412 249 1,168 206 2,580 455
Air Liquide SA * - 580 102 580 102
Alcatel 23,577 303 14,207 183 37,784 486
Alstom * 3,692 6 3,692 6
Alstom * 2,424 - 2,424 -
Alstom Subscription * 122 - 122 -
Altran Technologies SA * 6,277 81 6,277 81
Areclor 7,731 135 7,731 135
Atos Origin SA * - 273 17 273 17
Autoroutes du Sud de la France * - 841 28 841 28
Aventis SA * 12,657 836 7,916 523 20,573 1,359
AXA * 27,474 587 16,448 352 43,922 939
BNP Paribas * 13,566 853 9,484 597 23,050 1,450
Bouygues SA * 3,607 126 2,331 81 5,938 207
Business Objects 1,259 44 803 28 2,062 72
Caisse Nationale du Credit Agricole * - 4,214 101 4,214 101
Cap Gemini SA * 1,627 72 1,247 55 2,874 127
Carrefour SA * 11,330 621 6,676 366 18,006 987
Casino Guichard-Perrachon SA 1,045 102 432 42 1,477 144
CIE De St. Gobain * 6,517 319 3,652 179 10,169 498
Club Mediterranee SA 838 31 101 4 939 35
Cnp Assurances * (a) - 400 21 400 21
Dassault Systemes SA * 1,995 91 649 30 2,644 121
EADS, Inc. 5,569 132 3,288 78 8,857 210
Essilor International 2,365 122 1,106 57 3,471 179
France Telecom 20,955 598 12,603 360 33,558 958
Gecina * - 179 26 179 26
Groupe Danone * 1,748 285 1,435 234 3,183 519
Hermes International * - 100 19 100 19
Imerys SA * - 94 20 94 20
Klepierre * - 250 15 250 15
Lafarge * - 494 44 494 44
Lafarge SA * 2,579 229 1,944 173 4,523 402
Lagardere SCA 3,125 180 1,433 83 4,558 263
L'Oreal SA 6,925 567 3,948 323 10,873 890
LVMH * (Louis Vuitton Moet Hennessy) 4,273 311 2,853 207 7,126 518
Michelin 3,462 159 1,624 74 5,086 233
Pechiney SA, Class A * - 729 45 729 45
Pernod Ricard 1,045 116 611 68 1,656 184
Peugoet SA 1,567 80 2,099 107 3,666 187
Pinault-Printemps-Redoute SA * 1,465 142 794 77 2,259 219
Publicis Groupe SA * 2,645 86 1,161 37 3,806 123
Renault 3,207 221 1,992 137 5,199 358
Sagem SA 731 78 239 26 970 104
Sanofi-Synthelabo SA * 7,657 576 4,269 321 11,926 897
Schneider SA * 4,580 299 2,406 157 6,986 456
Societe BIC SA 1,234 57 357 16 1,591 73
Societe Generale * 5,636 497 3,829 338 9,465 835
Societe Television Francaise 4,028 140 1,417 49 5,445 189
Sodexho Alliance * - 1,097 33 1,097 33
STMicroelectronics * 10,712 290 6,821 185 17,533 475
SUEZ 15,282 307 9,349 188 24,631 495
Technip SA * - 207 22 207 22
Thomson CFS 1,747 59 839 28 2,586 87
Thomson Multimedia * 2,834 60 2,761 59 5,595 119
Total Fina SA - Cl.B * 12,377 2,299 7,509 1,394 19,886 3,693
Unibail SA 1,797 168 458 43 2,255 211
Valeo SA 1,489 60 867 35 2,356 95
Veolia Environnement * - 2,814 76 2,814 76
Vinci SA * - 803 66 803 66
Vivendi Universal SA * - 10,617 258 10,617 258
Wanadoo * - 4,344 35 4,344 35
Zodiac SA * - 463 13 463 13
------- ------- -------
12,771 8,560 21,331
Germany - 5.8% #
Adidas-Salomon AG 1,005 114 539 61 1,544 175
Aixtron AG * 607 4 607 4
Allianz AG * 4,706 593 3,353 423 8,059 1,016
Altana AG 1,460 88 842 51 2,302 139
BASF AG 12,086 679 6,322 355 18,408 1,034
Bayer AG * 11,401 333 7,649 224 19,050 557
Bayerische Vereinsbank AG * 6,678 154 4,240 98 10,918 252
Beiersdorf AG * 302 37 302 37
Celesio AG * 374 18 374 18
Commerzbank AG 8,364 164 5,044 99 13,408 263
Continental AG 2,656 101 1,361 52 4,017 153
DaimlerChrysler AG * 15,055 702 10,026 467 25,081 1,169
Deutsche Bank AG * 9,067 750 6,108 506 15,175 1,256
Deutsche Boerse AG 2,010 110 1,233 67 3,243 177
Deutsche Post AG 7,129 147 4,561 94 11,690 241
Deutsche Telekom AG * 37,337 683 29,354 537 66,691 1,220
Douglas Holding AG * 330 9 330 9
E.ON AG 9,846 642 7,257 473 17,103 1,115
Epcos AG * 574 13 574 13
Fresenius Medical Care AG 1,209 86 396 28 1,605 114
Heidelbergcement AG * 499 21 499 21
Henkel Kgaa-Vorzug * 685 54 685 54
Hypo Real Estate 3,568 89 1,492 37 5,060 126
Infineon Technologies AG * 8,538 118 5,447 76 13,985 194
Karstadt Quelle AG * 510 13 510 13
Linde AG 1,694 91 981 53 2,675 144
Lufthansa AG 4,687 78 2,285 38 6,972 116
MAN AG 2,695 82 1,194 36 3,889 118
Merck & Company, Inc. * 544 23 544 23
Metro AG 2,786 123 1,690 74 4,476 197
MLP AG * 659 13 659 13
Muenchener Rueckversicherungs-Gesellschaft AG * 2,643 320 1,737 210 4,380 530
ProSieben Sat.1 Media AG * 832 14 832 14
Puma AG 463 82 184 32 647 114
RWE AG 6,823 270 4,879 193 11,702 463
SAP AG * 3,683 618 2,387 400 6,070 1,018
Schering AG * 3,162 160 1,929 98 5,091 258
Siemens AG * 16,196 1,296 9,338 747 25,534 2,043
Suedzucker AG * 550 10 550 10
Thyssen Krupp AG * 6,252 123 3,702 73 9,954 196
Tui AG 3,781 79 1,512 31 5,293 110
Volkswagen AG 3,711 206 2,610 145 6,321 351
WCM Beteilgungs & Grundbesitz AG * 1,700 2 1,700 2
Wella AG * 163 14 163 14
------- ------- --------
9,081 6,023 15,104
Greece - 0.4% #
Alpha Bank * 1,900 57 1,900 57
Attica Enterprises Holding SA * 700 4 700 4
Bank of Piraeus 8,434 101 1,600 19 10,034 120
Commercial Bank of Greece 3,706 93 700 18 4,406 111
Duty Free Shops * 270 5 270 5
EFG Eurobank 8,088 156 2,210 43 10,298 199
Folli-Follie SA * 100 3 100 3
Greek Organization of Football Prognostics * 1,790 26 1,790 26
Hellenic Bottling Co. SA 5,160 108 810 17 5,970 125
Hellenic Petroleum SA * 1,200 11 1,200 11
Hellenic Technodomiki Tev SA * 500 3 500 3
Hellenic Telecommunications Organization SA * 3,040 40 3,040 40
Intracom SA 5,252 36 1,100 7 6,352 43
National Bank Of Greece * 2,162 56 2,162 56
Public Power Corp. * 1,180 29 1,180 29
Techniki Olympiaki SA * 600 3 600 3
Titan Cement Co. SA 2,217 91 340 14 2,557 105
Viohalco * 1,130 7 1,130 7
Vodafone Panafon SA * 15,869 123 2,000 16 17,869 139
------ ----- ------
708 378 1,086
Hong Kong - 1.5% # 0 -
ASM Pacific Technology, Ltd. * 0 2,000 9 2,000 9
Bank of East Asia * 0 16,000 49 16,000 49
Beijing Datang Power Generation Co., Ltd. 263,000 188 - 263,000 188
BOC Hong Kong Holdings, Ltd. * 0 30,000 57 30,000 57
Cathay Pacific Airways 20,000 38 12,000 23 32,000 61
Cheung Kong Holdings, Ltd. * 0 18,000 143 18,000 143
Cheung Kong Infrastructure Holdings, Ltd. * 0 6,000 13 6,000 13
China Southern Airlines Co. Ltd * 207,000 89 - 207,000 89
China Telecom, Ltd. * 16,199 50 - 16,199 50
CLP Holdings, Ltd. 42,100 200 20,900 99 63,000 299
Esprit Holdings, Ltd. * 0 7,500 25 7,500 25
Giordano International, Ltd. * 0 20,000 9 20,000 9
Guangshen Railway Co., Ltd. * 499,000 141 - 499,000 141
Hang Lung Properties, Ltd. * 0 13,000 17 13,000 17
Hang Seng Bank, Ltd. * 25,000 328 9,000 118 34,000 446
Henderson Land Development Co., Ltd. * 22,000 97 8,000 35 30,000 132
Hong Kong & China Gas Company, Ltd. * 0 42,490 65 42,490 65
Hong Kong Electric Holdings, Ltd. * 0 16,500 65 16,500 65
Hong Kong Exchange & Clearing, Ltd. * 0 12,000 26 12,000 26
Hopewell Highway * 0 700 - 700 -
Hopewell Holdings, Ltd. * 0 7,000 11 7,000 11
HSBC Holdings plc 4,900 77 - 4,900 77
Hutchison Whampoa, Ltd. * 41,500 305 24,800 182 66,300 487
Hysan Development Company, Ltd. * 0 6,000 9 6,000 9
Island Cable Communications * 6,200 1 1,200 - 7,400 1
Johnson Electric Holdings, Ltd. * 33,000 42 18,000 23 51,000 65
Legend Holdings * 122,000 52 - 122,000 52
Li & Fung, Ltd. * 36,000 62 18,000 31 54,000 93
MTR Corp. * 0 15,500 21 15,500 21
New World Development Co., Ltd. 48,000 39 19,000 15 67,000 54
PCCW, Ltd. 31,876 21 36,984 24 68,860 45
Shangri-La Asia, Ltd. * 0 12,000 11 12,000 11
Sino Land Company, Ltd. * 0 16,000 9 16,000 9
Smartone Telecommunications Holdings, Ltd. * 0 5,000 5 5,000 5
South China Morning Post, Ltd. * 0 10,000 4 10,000 4
Sun Hung Kai Properties, Ltd. * 46,000 379 15,000 124 61,000 503
Swire Pacific, Ltd. - Cl. A * 23,500 145 11,000 68 34,500 213
Techtronic Industries Company, Ltd. * 0 5,500 15 5,500 15
Television Broadcast, Ltd. * 0 3,000 15 3,000 15
Texwinca Holdings, Ltd. * 0 8,000 6 8,000 6
Wharf Holdings, Ltd. 62,000 172 14,000 39 76,000 211
----------- ----------- ----------
2,426 1,365 3,791
Hungary - 0.1% #
Gedeon Richter * 900 106 900 106
Mol Magyar Olaj-es Gazipari 3,600 109 3,600 109
OTP Bank 10,900 140 10,900 140
----------- ----------
355 355
Ireland - 0.6% # 0 -
Allied Irish Banks PLC - London * - 6,345 101 6,345 101
Allied Irish Banks plc * 8,467 135 3,649 58 12,116 193
Bank of Ireland 17,060 233 10,930 149 27,990 382
Bank of Ireland - London * - 405 6 405 6
CRH PLC - London * - 4,171 85 4,171 85
CRH plc * 9,000 185 1,944 40 10,944 225
DCC PLC * - 400 5 400 5
DCC PLC-GBP * - 627 9 627 9
Elan Corp. 5,813 40 4,143 29 9,956 69
Fyffes * - 4,000 8 4,000 8
Grafton Group * - 2,000 14 2,000 14
Greencore Group * - 1,069 5 1,069 5
Greencore Group PLC * - 1,300 6 1,300 6
Independent News & Media * - 6,463 15 6,463 15
Independent News & Media PLC * - 520 1 520 1
Irish Life & Permanent plc 4,553 73 3,142 51 7,695 124
Kerry Group * - 800 15 800 15
Kerry Group plc 5,800 109 815 15 6,615 124
Ryanair Holdings 4,845 40 - 4,845 40
Ryanair Holdings PLC * - 1,939 16 1,939 16
Waterford Wedgewood * - 700 - 700 -
Waterford Wedgewood PLC * - 8,769 2 8,769 2
----------- ---------- ----------
815 630 1,445
Israel - 0.2% #
Bank Hapoalim 43,700 108 43,700 108
Bezeq Israeli Telecommunication Corp., Ltd. 23,600 27 23,600 27
IDB Holding Corp., Ltd. 5,100 100 5,100 100
Koor Industries, Ltd. * 83 3 83 3
Makteshim-Agan Industries, Ltd. 26,900 101 26,900 101
Teva pharmaceutical Industries, Ltd. * 5,200 296 5,200 296
----------- ----------
635 635
Italy - 3.2% #
Alleanza Assicurazioni * 9,339 102 5,390 59 14,729 161
Assicurazioni Generali * 15,818 418 11,175 296 26,993 714
Autogrill SpA 5,723 82 1,307 19 7,030 101
Banca Fideuram 15,000 89 3,445 20 18,445 109
Banca Intesa SpA 76,966 301 41,262 161 118,228 462
Banca Intesa SPA - Non convertible * - 11,151 32 11,151 32
Banca Nazionale del Lavoro 41,580 99 17,775 42 59,355 141
Banca Popolare di Milano 18,100 118 4,533 30 22,633 148
BCA Di Roma * 31,073 91 14,103 41 45,176 132
BCE Pop Unite 7,459 135 - 7,459 135
BCP Pop Veron 8,371 142 4,267 72 12,638 214
Benetton Group SPA * - 631 7 631 7
Bulgari SPA * - 1,750 16 1,750 16
Enel SpA * 30,057 204 28,367 193 58,424 397
ENI * 52,773 995 30,411 573 83,184 1,568
Fiat SPA - DI RISP (Non Convertible) * - 680 3 680 3
Fiat SpA * 13,040 100 4,217 32 17,257 132
Finecogroup SPA * - 17,785 12 17,785 12
Finmeccanica SA 145,025 113 68,235 53 213,260 166
Gruppo Editoriale L'Espresso SPA * - 1,900 12 1,900 12
Italcementi SPA * - 854 11 854 11
Luxottica Group 4,176 72 1,621 28 5,797 100
Mediaset SpA * 13,210 157 6,979 83 20,189 240
Mediobanca SpA 11,141 121 5,396 58 16,537 179
Mediolanum SPA * - 2,775 22 2,775 22
Mondadori (Arnoldo) Editore SPA * - 1,400 13 1,400 13
Monte Paschi Siena 29,322 93 12,639 40 41,961 133
Parmalat Finanziaria SPA * - 4,047 1 4,047 1
Pirelli & Co SPA * - 20,319 21 20,319 21
Riunione Adriatica di Sicorta SpA 5,255 89 3,513 60 8,768 149
San Paolo-IMI SpA 7,083 92 11,816 154 18,899 246
Seat Pagine Gialle * 80,911 77 38,084 36 118,995 113
Snam Rete Gas SPA * - 10,081 43 10,081 43
Snia SPA * - 3,000 7 3,000 7
Telecom Italia 168,243 498 84,977 252 253,220 750
Telecom Italia 98,642 201 74,975 153 173,617 354
Telecom Italia Media * - 14,446 7 14,446 7
Telecom Italia Mobile SpA 69,129 375 44,093 239 113,222 614
Tiscali SPA * - 2,417 17 2,417 17
UniCredito Italiano SpA * 64,732 349 44,136 238 108,868 587
---------- ---------- ----------
5,113 3,156 8,269
Japan - 18.2% # 0 -
Acom Co., Ltd. * 2,300 104 840 38 3,140 142
Aderans Company, Ltd. * - 400 6 400 6
Advantest 2,000 159 800 63 2,800 222
Aeon Credit Service Company, Ltd. * - 300 13 300 13
Aiful Corp. * 1,000 73 500 37 1,500 110
Ajinomoto Co., Inc. 12,000 138 6,000 69 18,000 207
All Nippon Airways Company, Ltd. * - 5,000 12 5,000 12
Alps Electric Co. 6,000 88 2,000 29 8,000 117
Amada Company, Ltd. * - 3,000 16 3,000 16
Anritsu Corp. * - 1,000 7 1,000 7
Aoyama Trading Company * - 600 12 600 12
Ariake Japan Company, Ltd. * - 200 6 200 6
Asahi Breweries, Ltd. 13,000 119 4,500 41 17,500 160
Asahi Chemical Industry Co., Ltd. 26,000 141 14,000 76 40,000 217
Asahi Glass Co., Ltd. 18,000 148 9,000 74 27,000 222
ASATSU-DK, Inc. * - 300 8 300 8
Ashikaga Financial Group, Inc. * - 9,000 - 9,000 -
Autobacs Seven Company * - 400 9 400 9
Bandai Company * - 800 20 800 20
Bank of Yokohama, Ltd. * 23,000 107 11,000 51 34,000 158
Bellsystem24, Inc. * - 30 6 30 6
Benesse Corp. * - 800 20 800 20
Bridgestone Corp. 13,000 175 8,000 108 21,000 283
Canon, Inc. * 13,000 606 10,000 466 23,000 1,072
Capcom Company, Ltd. * - 300 4 300 4
Casio Computer Co. 9,000 95 2,000 21 11,000 116
Central Glass Company * - 2,000 13 2,000 13
Central Japan Railway Co. 13 112 11 95 24 207
Chiba Bank, Ltd. 16,000 66 7,000 29 23,000 95
Chichibu Onoda Cement * - 10,000 28 10,000 28
Chubu Electric Power 10,100 211 7,300 152 17,400 363
Chugai Pharmaceutical Co., Ltd. 7,600 109 3,200 46 10,800 155
Citizen Watch Co., Ltd. 10,000 92 3,000 28 13,000 120
Coca-Cola West Japan Company, Ltd. * - 400 8 400 8
Comsys Holdings * 5,000 32 1,000 6 6,000 38
Credit Saison Co., Ltd. 3,600 81 1,600 36 5,200 117
CSK Corp. * 2,100 76 700 25 2,800 101
Daicel Chemical Industries, Ltd. * - 3,000 12 3,000 12
Daido Life Insurance 25 74 14 42 39 116
Daiei, Inc. * - 2,000 4 2,000 4
Dai-Ichi Pharmaceutical Co., Ltd. 7,000 126 2,800 50 9,800 176
Daikin Industries, Ltd. 5,000 116 2,000 46 7,000 162
Daimaru, Inc. * - 3,000 17 3,000 17
Dainippon Ink & Chemicals, Inc. * - 8,000 15 8,000 15
Dai-Nippon Printng Co., Ltd. 13,000 183 7,000 98 20,000 281
Dainippon Screen Manufacturing Company, Ltd. * - 2,000 14 2,000 14
Daito Trust Construction Co., Ltd. 2,300 68 1,100 33 3,400 101
Daiwa Bank Holdings 92,000 116 53,000 67 145,000 183
Daiwa House Industry Co., Ltd. 10,000 106 5,000 53 15,000 159
Daiwa Securities Group, Inc. 2,900 20 14,000 95 16,900 115
Denki Kagaku Kogyo Kabushiki Kaisha * - 5,000 16 5,000 16
Denso Corp. 8,400 165 5,700 112 14,100 277
Dentsu, Inc. * - 3 15 3 15
Dowa Mining Company, Ltd. * - 3,000 16 3,000 16
East Japan Railway Co. 60 283 40 189 100 472
Ebara Corp. * - 3,000 13 3,000 13
Eisai Company * 4,900 132 2,600 70 7,500 202
Familymart Company, Ltd. * - 800 18 800 18
Fanuc, Ltd. * 2,400 144 1,400 84 3,800 228
Fast Retailing Co. 1,100 67 600 36 1,700 103
Fuji Electric Holdings * - 7,000 15 7,000 15
Fuji Photo Film Company, Ltd. * 9,000 291 5,000 162 14,000 453
Fuji Television Network, Inc. * - 3 16 3 16
Fujikura, Ltd. * - 4,000 24 4,000 24
Fujisawa Pharmeceutical Co., Ltd. * 7,000 149 3,000 64 10,000 213
Fujitsu, Ltd. * 33,000 195 19,000 112 52,000 307
Furukawa Electric Company, Ltd. * - 7,000 23 7,000 23
Gunma Bank * - 4,000 18 4,000 18
Gunze, Ltd. 14,000 63 2,000 9 16,000 72
Hankyu Department Stores * - 2,000 13 2,000 13
Hino Motors, Ltd. * - 3,000 21 3,000 21
Hirose Electric Co., Ltd. * 1,100 126 300 34 1,400 160
Hitachi Cable, Ltd. * - 2,000 8 2,000 8
Hitachi Chemical * - 1,300 22 1,300 22
Hitachi Software Engineering Company, Ltd. * - 300 8 300 8
Hitachi, Ltd. 54,000 326 33,000 199 87,000 525
Hokugin Financial * - 10,000 14 10,000 14
Honda Motor Co. 14,300 635 9,100 404 23,400 1,039
House Food Corp. * - 800 9 800 9
Hoya Corp. * 200 18 1,300 119 1,500 137
Isetan Company, Ltd. * - 1,800 20 1,800 20
Ishihara Sangyo * (a) - 4,000 8 4,000 8
Ishikawajima Harima Heavy Industries Company, Ltd. * - 12,000 17 12,000 17
Itochu Corp. 34,000 112 16,000 53 50,000 165
Itochu Techno-Science Corp. * - 300 9 300 9
ITOEN, Ltd. * - 300 13 300 13
Ito-Yokado Co., Ltd. * 7,000 220 4,000 126 11,000 346
Jafco Company, Ltd. * - 300 24 300 24
Japan Airlines System Corp. * - 8,000 21 8,000 21
Japan Real Estate Investment * - 3 19 3 19
Japan Tobacco, Inc. 21 154 8 59 29 213
JFE Holdings, Inc. * 8,800 240 5,400 147 14,200 387
JGC Corp. * - 2,000 21 2,000 21
Joyo Bank, Ltd. 29,000 95 8,000 26 37,000 121
JSR Corp. 4,000 89 2,000 45 6,000 134
Jusco Co., Ltd. 4,800 161 2,700 90 7,500 251
Kajima Corp. 25,000 81 10,000 32 35,000 113
Kaken Pharmaceutical Company, Ltd. * - 1,000 5 1,000 5
Kamigumi Company * - 3,000 21 3,000 21
Kanebo * - 3,000 3 3,000 3
Kaneka Corp. * - 3,000 22 3,000 22
Kansai Electric Power Co., Inc. 800 14 7,900 138 8,700 152
KAO Corp. 10,000 203 6,000 122 16,000 325
Katokichi Company * - 500 8 500 8
Kawasaki Heavy Industries, Ltd. * - 13,000 16 13,000 16
Kawasaki Kisen 23,000 114 5,000 25 28,000 139
Keihin Electric Express Railway Co., Ltd. 17,000 100 5,000 29 22,000 129
Keio Teito Electric Railway 14,000 73 6,000 31 20,000 104
Keyence Corp. 700 148 400 84 1,100 232
Kikkoman Corp. * - 1,000 7 1,000 7
Kinden Corp. * - 2,000 9 2,000 9
Kinki Nippon Railway 33,000 99 17,000 51 50,000 150
Kirin Brewery Co. * 14,000 119 8,000 68 22,000 187
Kokuyo Company, Ltd. * - 600 7 600 7
Komatsu 28,000 178 11,000 70 39,000 248
Komori Corp. * - 1,000 15 1,000 15
Konami Co., Ltd. 3,000 87 1,000 29 4,000 116
Konica Corp. 11,000 148 4,500 61 15,500 209
Koyo Seiko Company * - 1,000 10 1,000 10
Kubota Corp. * 25,000 103 11,000 45 36,000 148
Kuraray Co., Ltd. 10,000 84 4,000 34 14,000 118
Kurita Water Industries, Ltd. * - 1,000 12 1,000 12
Kyocera Corp. * 3,300 220 1,900 127 5,200 347
Kyowa Hakko Kogyo * - 4,000 25 4,000 25
Kyushu Electric Power 6,300 108 4,700 81 11,000 189
Lawson 1,600 55 700 24 2,300 79
Mabuchi Motor Co. * 900 69 300 23 1,200 92
Makita Corp. * - 1,000 10 1,000 10
Marubeni Corp. 38,000 73 15,000 29 53,000 102
Marui Co., Ltd. * 10,000 126 4,000 50 14,000 176
Matsumotokiyoshi Co * - 200 4 200 4
Matsumotokiyoshi Company, Ltd. * - 200 4 200 4
Matsushita Electric Industrial Co. * 27,000 374 24,000 332 51,000 706
Matsushita Electric Works 10,000 90 5,000 45 15,000 135
Meiji Milk Product * - 2,000 9 2,000 9
Meiji Seika Kaisha, Ltd. * - 3,000 12 3,000 12
Meitec Corp. * - 400 15 400 15
Millea Holdings, Inc. * 23 301 17 222 40 523
Minebea Co., Ltd. 12,000 61 4,000 20 16,000 81
Mitsubishi Chemical Corp. 43,000 112 19,000 49 62,000 161
Mitsubishi Corp. 3,000 32 12,000 127 15,000 159
Mitsubishi Electric Corp. 43,000 179 20,000 83 63,000 262
Mitsubishi Estate Co., Ltd. * 19,000 180 11,000 104 30,000 284
Mitsubishi Gas Chemical Company, Inc. * - 4,000 14 4,000 14
Mitsubishi Heavy Industries, Ltd. * 58,000 161 33,000 92 91,000 253
Mitsubishi Logistc Corp. * - 1,000 8 1,000 8
Mitsubishi Materials Corp. * - 11,000 17 11,000 17
Mitsubishi Paper Company * - 2,000 3 2,000 3
Mitsubishi Rayon Company, Ltd. * - 6,000 23 6,000 23
Mitsubishi Tokyo Finance 73 570 47 367 120 937
Mitsui & Co., Ltd. 1,000 8 14,000 113 15,000 121
Mitsui Engineering & Shipbuilding Company, Ltd. * - 8,000 13 8,000 13
Mitsui Fudosan Co., Ltd. * 15,000 136 8,000 72 23,000 208
Mitsui Marine & Fire Insurance Co., Ltd. 23,000 189 15,000 123 38,000 312
Mitsui Mining & Smelting Co., Ltd. * 17,000 71 6,000 25 23,000 96
Mitsui OSK Lines, Ltd. 24,000 117 9,000 44 33,000 161
Mitsui Petrochemical Co. 18,000 105 6,000 35 24,000 140
Mitsui Trust Holdings 17,000 95 6,000 34 23,000 129
Mitsukoshi, Ltd. * - 3,000 12 3,000 12
Mitsumi Electric Company, Ltd. * - 900 10 900 10
Mizuho Financial GB * 110 334 56 170 166 504
Murata Manufacturing Co., Ltd. * 4,600 249 2,600 141 7,200 390
Namco, Ltd. * - 400 11 400 11
NEC Corp. * 29,000 214 17,000 125 46,000 339
Net One Systems Company, Ltd. * - 2 15 2 15
NGK Insulators, Ltd. * - 3,000 22 3,000 22
NGK Spark Plug Company * - 2,000 16 2,000 16
Nichii Gakkan Company * - 200 11 200 11
Nichirei Corp. * - 3,000 10 3,000 10
Nidec Corp. * 900 86 400 38 1,300 124
Nikko Securities Co., Ltd. * 28,000 156 15,000 84 43,000 240
Nikon Corp. 8,000 121 3,000 45 11,000 166
Nintendo Corp., Ltd. 2,100 196 1,200 112 3,300 308
Nippon Building Fund 11 71 2 13 13 84
Nippon Express Co., Ltd. 22,000 104 9,000 43 31,000 147
Nippon Kayaku Company, Ltd. * - 2,000 10 2,000 10
Nippon Meat Packer * - 2,000 20 2,000 20
Nippon Mining Holdings, Inc. * - 6,000 21 6,000 21
Nippon Oil Corp. 36,000 183 15,000 76 51,000 259
Nippon Sanso Corp. * - 2,000 8 2,000 8
Nippon Sheet Glass * - 5,000 15 5,000 15
Nippon Shokubai Company, Ltd. * - 2,000 15 2,000 15
Nippon Steel Co. 19,000 41 63,000 135 82,000 176
Nippon Telegraph & Telephone Corp. * 95 458 61 294 156 752
Nippon Unipac Holding, Co. 27 139 10 52 37 191
Nippon Yusen Kabushiki Kaisha 27,000 122 11,000 50 38,000 172
Nishimatsu Construction Company, Ltd. * - 3,000 10 3,000 10
Nissan Chemical Industries, Ltd. * - 2,000 18 2,000 18
Nissan Motor Acceptance Corp. 45,700 522 29,000 331 74,700 853
Nisshin Flour Mill * - 2,000 18 2,000 18
Nisshinbo Industries, Inc. * - 2,000 11 2,000 11
Nissin Food Products * - 1,000 25 1,000 25
Nitto Denko Corp. * 3,200 170 1,800 96 5,000 266
Nomura Research Institute, Ltd. * - 300 29 300 29
Nomura Securities Co., Ltd. * 33,000 562 21,000 358 54,000 920
Noritake Company * - 1,000 4 1,000 4
NSK, Ltd. * - 5,000 18 5,000 18
NTN Corp. 13,000 62 5,000 24 18,000 86
NTT Data Corp. 33 125 15 57 48 182
NTT Mobile Communications Network, Inc. * 317 719 205 465 522 1,184
Obayashi Corp. 16,000 72 7,000 31 23,000 103
OBIC Co., Ltd. * - 100 20 100 20
Oji Paper Co. 17,000 110 9,000 58 26,000 168
Oki Electric Industry Co. * 16,000 63 6,000 23 22,000 86
Okumura Corp. * - 2,000 9 2,000 9
Olympus Optical Co. * 6,000 130 2,000 43 8,000 173
Omron Corp. 5,000 102 2,400 49 7,400 151
Onward Kashiyama Company, Ltd. * - 1,000 12 1,000 12
Oracle Corp. * - 400 21 400 21
Oriental Land Co., Ltd. 2,000 123 600 37 2,600 160
Orix Corp. * 2,100 174 1,000 83 3,100 257
Osaka Gas Co. 42,000 114 24,000 65 66,000 179
Pioneer Corp. * 5,000 138 1,800 50 6,800 188
Promise Co., Ltd. * 2,600 113 1,050 46 3,650 159
Q.P. Corp. * - 1,500 12 1,500 12
Ricoh Co., Ltd. 13,000 257 7,000 138 20,000 395
Rohm Co., Ltd. * 2,100 246 1,200 141 3,300 387
Saizeriya Company, Ltd. * - 200 2 200 2
Sanden Corp. * - 1,000 6 1,000 6
Sankyo Co., Ltd. * 7,700 145 4,200 79 11,900 224
Sankyo Company * - 500 16 500 16
Sanyo Electric Co. * 32,000 167 18,000 94 50,000 261
Sapporo Holdings * - 4,000 11 4,000 11
Secom Company, Ltd. * 4,500 168 2,500 93 7,000 261
SEGA Enterprises * - 1,300 12 1,300 12
Seiko Epson Corp. * - 700 33 700 33
Seino Transportation * - 2,000 17 2,000 17
Sekisui Chemical Company, Ltd. * - 5,000 25 5,000 25
Sekisui House, Ltd. * 13,000 134 6,000 62 19,000 196
Seven-Eleven Japan * 8,000 243 5,000 152 13,000 395
Sharp Corp. 18,000 284 10,000 158 28,000 442
Shimachu Company, Ltd. * - 600 12 600 12
Shimamura Company * - 300 20 300 20
Shimano, Inc. * - 800 17 800 17
Shimizu Corp. * - 6,000 23 6,000 23
Shin-Etsu Chemical Co. * 6,600 270 4,200 172 10,800 442
Shionogi & Co., Ltd. * 8,000 149 3,000 56 11,000 205
Shiseido Co., Ltd. * 8,000 97 4,000 49 12,000 146
Shizuoka Bank, Ltd. 13,000 96 7,000 52 20,000 148
Showa Denko KK * - 11,000 25 11,000 25
Showa Shell Sekiyu * - 1,400 11 1,400 11
Skylark Company * - 1,000 17 1,000 17
SMC Corp. * 1,400 174 600 75 2,000 249
Snow Brand Milk * - 1,000 3 1,000 3
Softbank Corp. 3,900 119 2,400 73 6,300 192
Sony Corp. * 16,400 568 10,200 353 26,600 921
Stanley Electric 3,800 74 1,700 33 5,500 107
Sumitomo Bakelite Company, Ltd. * - 2,000 13 2,000 13
Sumitomo Chemical Co. 26,000 107 13,000 54 39,000 161
Sumitomo Corp. * 20,000 149 8,000 60 28,000 209
Sumitomo Electric Industries 15,000 134 7,000 63 22,000 197
Sumitomo Heavy Industries, Ltd. * - 6,000 14 6,000 14
Sumitomo Metal Industries 102,000 101 39,000 39 141,000 140
Sumitomo Metal Mining Co. 17,000 126 6,000 45 23,000 171
Sumitomo Mitsui GR 71 378 44 235 115 613
Sumitomo Osaka Cement Company, Ltd. * - 4,000 8 4,000 8
Sumitomo Realty & Development 8,000 70 4,000 35 12,000 105
Sumitomo Trust & Banking 23,000 135 11,000 65 34,000 200
Suruga Bank * - 2,000 13 2,000 13
Suzuken Company, Ltd. * - 500 16 500 16
Taisei Corp. 20,000 73 9,000 33 29,000 106
Taisho Pharmaceutical Co., Ltd. * 5,000 89 2,000 36 7,000 125
Taiyo Yuden Company * - 1,000 13 1,000 13
Takara Holdings * - 2,000 19 2,000 19
Takashimaya Co. * 9,000 64 3,000 21 12,000 85
Takeda Chemical Industries * 15,100 599 9,800 389 24,900 988
Takefuji Corp. * 2,020 94 740 35 2,760 129
Takuma Company * - 1,000 5 1,000 5
TDK Corp. * 2,400 173 1,300 94 3,700 267
Teijin, Ltd. 25,000 74 9,000 26 34,000 100
Teikoku Oil Company * - 2,000 10 2,000 10
Terumo Corp. * 5,200 99 1,900 36 7,100 135
The 77th Bank, Ltd. * - 4,000 23 4,000 23
The Bank of Fukuoka, Ltd. 20,000 84 6,000 25 26,000 109
THK Company, Ltd. * - 1,100 22 1,100 22
TIS, Inc. * - 400 14 400 14
Tobu Railway Co., Ltd. 22,000 79 9,000 32 31,000 111
Toda Corp. * - 2,000 6 2,000 6
Toho Company * - 1,500 19 1,500 19
Tohoku Electric Power 6,700 111 5,000 83 11,700 194
Tokyo Broadcasting Company * - 400 6 400 6
Tokyo Electric Power 19,700 432 13,400 294 33,100 726
Tokyo Electron, Ltd. * 3,100 236 1,700 129 4,800 365
Tokyo Gas Co. 47,000 168 29,000 103 76,000 271
Tokyo Style Co. 6,000 65 1,000 11 7,000 76
Tokyu Corp. * 26,000 133 11,000 56 37,000 189
Tonengeneral Sekiyu 8,000 66 3,000 25 11,000 91
Toppan Printing Co. * 16,000 167 6,000 62 22,000 229
Toray Industries, Inc. * 33,000 138 14,000 59 47,000 197
Toshiba Corp. * 54,000 205 32,000 121 86,000 326
Toshiba Corp. * - 5,000 17 5,000 17
Tostem Corp. 6,000 116 3,000 58 9,000 174
Toto, Ltd. 8,000 68 4,000 34 12,000 102
Toyo Seikan Kaisha * - 2,000 28 2,000 28
Toyo Suisan Kaisha * - 1,000 11 1,000 11
Toyobo Co. 32,000 70 7,000 15 39,000 85
Toyoda Gosei * - 600 17 600 17
Toyota Industries Corp. * - 1,900 40 1,900 40
Toyota Motor Corp. * 48,300 1,632 31,600 1,068 79,900 2,700
Trend Micro, Inc. * - 1,000 27 1,000 27
UBE Industries * - 9,000 18 9,000 18
UFJ Holdings, Inc. * 67 322 41 197 108 519
UNI Charm Corp. * - 500 25 500 25
UNY Company, Ltd. * - 2,000 21 2,000 21
Ushio, Inc. 3,000 50 1,000 17 4,000 67
Uss Co., Ltd. * - 220 16 220 16
Wacoal Corp. * 8,000 66 1,000 8 9,000 74
West Japan Railway 25 98 13 51 38 149
World Company * - 400 13 400 13
Yakult Honsha Company * - 1,000 16 1,000 16
Yamada Denki Co. 2,300 77 900 30 3,200 107
Yamaha Corp. 3,800 75 1,800 35 5,600 110
Yamaha Motor Company, Ltd. * - 1,000 11 1,000 11
Yamanouchi Pharmaceutical Co., Ltd. * 6,200 193 3,600 112 9,800 305
Yamato Transport Co., Ltd. 12,000 141 5,000 59 17,000 200
Yamazaki Baking Company * - 2,000 17 2,000 17
Yasuda F & M Insurance 15,000 123 9,000 74 24,000 197
Yokogawa Electric 8,000 116 2,000 29 10,000 145
----------- ----------- -----------
28,649 18,275 46,924
Luxembourg - 0.0% #
Areclor * 3,986 69 3,986 69
Malaysia - 0.3% # 0 -
Berjaya Sports Toto Berhad 39,000 42 39,000 42
Commerce Asset Holdings * 44,000 48 44,000 48
Gamuda Berhad 22,000 37 22,000 37
IJM Corporation Berhad 19,000 23 19,000 23
IJM Plantations 7,600 2 7,600 2
Malayan Banking Berhad * 66,000 168 66,000 168
Malaysia International Shipping Berhad 27,000 82 27,000 82
Public Bank Berhad 91,250 74 91,250 74
Resorts World Berhad * 21,000 56 21,000 56
Sime Darby Berhad * 68,000 93 68,000 93
Telekom Malaysia Berhad 40,000 88 40,000 88
Tenaga Nasional Berhad 28,000 70 28,000 70
YTL Corp., Berhad 76,460 87 76,460 87
----------- -----------
870 870
Mexico - 0.4% #
America Movil SA de CV -Ser. L * 162,000 223 162,000 223
Cemex SA de CV * 24,000 125 24,000 125
Cifra SA de CV - Ser. V * 30,000 86 30,000 86
Fomento Economico Mexicano SA de CV * 20,000 74 20,000 74
GF BBVA Bancomer - Ser. B 70,000 60 70,000 60
Grupo Carso SA de CV - Ser. A1 * 16,000 56 16,000 56
Grupo Modelo SA de CV - Ser. C * 34,000 81 34,000 81
Grupo Televisa SA 54,000 108 54,000 108
Kimberly-Clark de Mexico SA de CV * 22,000 56 22,000 56
Nuevo Grupo Mexico 18,000 46 18,000 46
Telephonos de Mexico SA - Ser. L 63,031 104 63,031 104
U.S. Commercial Corp. - Ser. B1 16,000 7 16,000 7
----------- -----------
1,026 1,026
Netherlands - 4.2% #
ABN Amro Holding NV * 27,165 635 17,885 418 45,050 1,053
Aegon NV * 27,787 411 15,715 232 43,502 643
Akzo Nobel NV * 5,304 205 3,156 122 8,460 327
ASM Lithography Holding NV 5,100 101 5,335 106 10,435 207
Corio NV * - 500 19 500 19
Dsm NV * - 900 44 900 44
Elsevier NV * 22,877 284 7,276 90 30,153 374
Euronext * - 1,117 28 1,117 28
Getronics NV * - 1,907 4 1,907 4
Hagemeyer NV * - 849 2 849 2
Heineken NV * 2,968 113 2,273 87 5,241 200
IHC Caland NV * - 371 20 371 20
ING Groep NV 31,865 742 20,437 476 52,302 1,218
Koninklijke (Royal) KPN NV * - 933 13 933 13
Koninklijke (Royal) Philips Electronics NV * 22,807 665 15,348 448 38,155 1,113
Koninklijke Ahold NV * - 7,596 58 7,596 58
Koninklijke KPN NV * 36,643 283 24,664 190 61,307 473
Numico Kon NV * - 1,731 48 1,731 48
Oce-Van Der Grinten * - 972 15 972 15
Qiagen NV * - 1,475 18 1,475 18
Rodamco Europe NV * - 500 29 500 29
Royal Dutch Petroleum Co. * 40,573 2,137 24,306 1,280 64,879 3,417
TNT Post Group NV 5,610 131 3,914 92 9,524 223
Unilever NV * 10,965 716 6,663 435 17,628 1,151
Vedior NV * - 992 16 992 16
VNU NV * - 2,606 82 2,606 82
Wereldhave NV * - 257 19 257 19
Wolters Kluwer NV * 4,000 62 3,127 49 7,127 111
----------- ----------- -----------
6,485 4,440 10,925
New Zealand - 0.3% #
Auckland International Airport, Ltd. * - 2,732 12 2,732 12
Carter Holt Harvey, Ltd. 37,800 47 9,831 12 47,631 59
Contact Energy Limited 40,900 144 3,264 11 44,164 155
Fisher & Paykel AP 28,996 73 3,080 8 32,076 81
Fisher & Paykel Industries, Inc. 8,443 70 863 7 9,306 77
Fletcher Building 31,200 87 5,215 14 36,415 101
Fletcher Challenge Forests * - 967 1 967 1
Independent Newspapers, Ltd. * - 2,005 7 2,005 7
NGC Holdings Ltd. * - 1,971 3 1,971 3
Sky City Entertainment Group, Ltd. * - 4,544 14 4,544 14
Sky Network Television, Ltd. * - 1,125 4 1,125 4
Telecom Corp. of New Zealand, Ltd. * - 22,717 80 22,717 80
The Warehouse Group, Ltd. 29,000 97 1,694 6 30,694 103
Tower Ltd. * - 4,813 4 4,813 4
----------- ----------- -----------
518 183 701
Norway - 0.5% #
Aker Kvaerner 380 7 230 4 610 11
Den Norske Bank 18,760 125 8,929 60 27,689 185
Elkem ASA 700 21 - 700 21
Frontline, Ltd. * - 400 10 400 10
Merkantildata ASA 9,800 8 - 9,800 8
Nera ASA * - 700 2 700 2
Norsk Hydro ASA 84 5 1,700 105 1,784 110
Norske Skogindustrier ASA * 5,100 97 1,350 26 6,450 123
Opticom AS 160 2 - 160 2
Orkla SA * - 2,300 51 2,300 51
Schibsted ASA * - 600 10 600 10
Smedvig * 3,600 27 100 1 3,700 28
Smedvig ASA * 4,600 29 200 1 4,800 30
Statoil ASA * 8,908 100 5,000 56 13,908 156
Storebrand ASA 16,140 105 2,200 14 18,340 119
Tandberg ASA 3,920 29 1,400 10 5,320 39
Telenor AS * 22,160 145 8,300 54 30,460 199
Tomra Systems ASA 10,000 60 2,300 14 12,300 74
----------- ----------- -----------
760 418 1,178
Philippines - 0.1% #
Ayala Land, Inc. * 410,460 45 410,460 45
Metro Bank & Trust 65,450 32 65,450 32
Philippine Long Distance Telephone Co. * 3,200 56 3,200 56
SM Prime Holdings, Inc. 48,000 6 48,000 6
----------- -----------
139 139
Portugal - 0.3% #
Banco Comercial Portgues SA 62,300 139 22,491 50 84,791 189
Banco Espirito Santo SA * - 1,272 21 1,272 21
BPI-SGPS SA 33,590 123 4,613 17 38,203 140
Brisa Auto Estrada * - 3,395 23 3,395 23
Cimpor-Cimentos De Portugal, SA * - 2,540 13 2,540 13
Electricidade De Portugal * - 20,775 55 20,775 55
Jeronimo Martins, SGPS * - 185 2 185 2
Part Multimedia SGPS 4,439 86 522 10 4,961 96
Portugal Telecom * - 10,896 110 10,896 110
Sonae SGPS SA 87,600 73 13,165 11 100,765 84
----------- ----------- -----------
421 312 733
Singapore - 0.7% #
Allgreen Properties, Ltd. * - 7,000 5 7,000 5
CapitaLand, Ltd. * - 12,000 11 12,000 11
Chartered Semiconductor Manufacturing 12,000 12 12,000 12 24,000 24
City Developments, Ltd. 15,000 53 5,000 18 20,000 71
Comfortdelgro Corp * - 16,000 8 16,000 8
Creative Technology, Ltd. * - 450 5 450 5
Cycle & Carriage, Ltd. 8,766 30 1,000 3 9,766 33
Datacraft Asia, Ltd. * - 4,000 5 4,000 5
DBS Group Holdings, Ltd. * 17,000 147 13,000 113 30,000 260
Fraser & Neave, Ltd. * - 1,620 12 1,620 12
Guocoland, Ltd. * - 2,000 1 2,000 1
Haw Par Value Corp. , Ltd. 26,876 71 1,490 4 28,366 75
Hotel Properties, Ltd. * - 3,000 2 3,000 2
Keppel Corp., Ltd. * - 6,000 22 6,000 22
Keppel Land, Ltd. * - 3,000 3 3,000 3
NatSteel, Ltd. * - 1,000 1 1,000 1
Neptune Orient Lines, Ltd. 14,000 18 12,000 15 26,000 33
Oversea-Chinese Banking Corp., Ltd. 39,000 278 12,000 85 51,000 363
OverSeas Union Enterprises, Ltd. * - 1,000 4 1,000 4
Parkway Holdings, Ltd. * - 6,000 3 6,000 3
SembCorp Industries, Ltd. * - 9,000 7 9,000 7
SembCorp Logistics, Ltd. * - 5,000 6 5,000 6
SembCorp Marine, Ltd. * - 2,000 1 2,000 1
Singapore Airlines, Ltd. * - 7,000 46 7,000 46
Singapore Exchange, Ltd. * - 8,000 8 8,000 8
Singapore Land, Ltd. * - 1,000 2 1,000 2
Singapore Post Ltd. * - 14,000 6 14,000 6
Singapore Press Holdings, Ltd. * - 4,000 45 4,000 45
Singapore Technologies Engineering, Ltd. * - 15,000 18 15,000 18
Singapore Telecommunications, Ltd. * 101,000 116 73,000 84 174,000 200
SMRT Corporation Ltd. * - 12,000 4 12,000 4
ST Assembly Test Services, Ltd. * - 4,000 5 4,000 5
United Overseas Bank * 42,448 330 14,000 109 56,448 439
United Overseas Land, Ltd. * - 3,000 3 3,000 3
Venture Corp., Ltd. * - 3,000 35 3,000 35
Wing Tai Holdings * - 4,000 2 4,000 2
----------- ----------- -----------
1,055 713 1,768
South Africa - 0.9% #
Anglo American Platinum Corp., Ltd. * 1,200 52 1,200 52
Anglo American plc * 30,000 641 30,000 641
Anglogold * 3,100 145 3,100 145
Barlow, Ltd. * 7,400 78 7,400 78
Dimension Data Holdings plc 79,483 53 79,483 53
FirstRand, Ltd. 94,300 126 94,300 126
Foschini, Ltd. 37,100 109 37,100 109
Gold Fields Mining * 9,600 137 9,600 137
Impala Platinum Holdings, Ltd. 1,000 87 1,000 87
Imperial Holdings, Ltd. 10,091 101 10,091 101
Investec Ltd. 3,051 58 3,051 58
Liberty Life Association of Africa, Ltd. 10,300 83 10,300 83
M-Cell, Ltd. 8,400 36 8,400 36
Nampak, Ltd. 25,500 50 25,500 50
Nedcor, Ltd. * 4,300 40 4,300 40
Sappi, Ltd. * 5,700 78 5,700 78
Sasol, Ltd. * 11,800 168 11,800 168
South African Breweries plc 6,000 61 6,000 61
Standard Bank Investment Corp., Ltd. 18,000 105 18,000 105
------- -------
2,208 2,208
South Korea - 0.9% #
Hyundai Motor Co., Ltd. 3,560 151 3,560 151
KIA Motors Corp. 3,310 30 3,310 30
Kookmin Bank * 6,399 240 6,399 240
Korea Electric Power Corp. * 7,430 133 7,430 133
Korea Telecom Corp. 1,040 39 1,040 39
Korea Telecom Freetel 2,980 48 2,980 48
LG Chemical 2,035 94 2,035 94
LG Electronics, Inc. 1,931 95 1,931 95
LG Investment & Securities Co., Ltd. * 2,460 17 2,460 17
Pohang Iron & Steel Co., Ltd. 1,323 181 1,323 181
Samsung Corp. 6,120 51 6,120 51
Samsung Display Devices Co. 1,000 118 1,000 118
Samsung Electro-Mechanics Co. 1,460 48 1,460 48
Samsung Electronics * 2,159 817 2,159 817
Samsung Fire & Marine Insurance 942 54 942 54
Samsung Securities Co., Ltd. 2,470 53 2,470 53
Shinhan Financial 6,930 111 6,930 111
SK Telecom Co., Ltd. * 820 137 820 137
------- -------
2,417 2,417
Spain - 3.2% #
Abertis Infrastructuras SA * 6,287 95 2,536 38 8,823 133
Acciona SA * - 363 22 363 22
Acerinox SA 1,752 82 559 26 2,311 108
ACS, Actividades de Construccion y Servicios, SA 4,229 206 1,127 55 5,356 261
Aguas De Barcelona * - 695 10 695 10
Altadis SA, Series A * 6,360 180 3,147 89 9,507 269
Amadeus Global Travel 5,240 34 3,055 20 8,295 54
Antena 3 Television SA * - 177 8 177 8
Banco Bilbao Vizcaya SA * 49,959 689 35,328 487 85,287 1,176
Banco Popular Espanol SA 3,070 183 1,846 110 4,916 293
Banco Santander Central Hispano SA * 71,715 848 50,119 593 121,834 1,441
Corporacion Mapfre SA * - 1,026 15 1,026 15
Endesa SA * 15,465 297 10,443 201 25,908 498
Fomento de Construcciones y Contratas SA 1,400 52 578 21 1,978 73
Gas Natural SDG SA * 6,400 150 2,413 56 8,813 206
Grupo Ferrovial SA * 2,312 81 752 26 3,064 107
Iberdrola SA 13,874 274 8,906 176 22,780 450
Iberia Lineas Aereas de Espana SA * - 5,566 16 5,566 16
Inditex 6,292 128 2,499 51 8,791 179
Indra Sistemas SA 6,236 80 1,300 17 7,536 97
NH Hoteles SA * 7,422 85 768 9 8,190 94
Promotora de Informaciones SA * - 897 13 897 13
Repsol SA * 17,332 338 10,683 208 28,015 546
Telefonica Publicidad e Informacion SA * - 1,733 9 1,733 9
Telefonica SA * 82,822 1,215 54,865 805 137,687 2,020
TelePizza SA * - 1,211 2 1,211 2
Union Electrica Fenosa SA 4,900 92 2,249 42 7,149 134
Vallehermoso SA 4,915 74 1,116 17 6,031 91
Zeltia SA * - 1,784 13 1,784 13
------- ------- -------
5,183 3,155 8,338
Sweden - 1.8% #
Alfa Laval AB * - 900 14 900 14
Assa Abloy AB * - 3,400 40 3,400 40
Atlas Copco AB-A Shares * - 1,300 47 1,300 47
Atlas Copco AB-B Shares * - 800 26 800 26
Axfood AB * - 300 7 300 7
Billerud Aktibolag * - 600 9 600 9
Castellum AB * - 400 9 400 9
Drott AB 5,400 103 900 17 6,300 120
Electrolux AB * 4,900 108 3,500 77 8,400 185
Eniro AB * - 2,200 21 2,200 21
Gambro AB, B Shares * - 1,100 9 1,100 9
Getinge Ab * - 1,600 15 1,600 15
Hennes & Mauritz AB * 14,223 338 5,525 131 19,748 469
Hoganas AB, B Shares * - 300 6 300 6
Holmen AB * - 600 21 600 21
Incentive AB, Series A * - 1,900 16 1,900 16
Modern Time Group AB, B Shares * - 550 12 550 12
NetCom Systems, Inc. 1,732 92 1,150 61 2,882 153
Nobel Biocare Holding AG * - 100 10 100 10
Nordic Baltic Holding AB 59,137 444 27,500 206 86,637 650
OM Hex AB - 750 9 750 9
Sandvik AB * 4,350 150 2,600 90 6,950 240
SAS AB * - 1,200 11 1,200 11
Securitas AB * 11,000 148 3,400 46 14,400 194
Skand Enskilda Banken 10,200 150 5,600 83 15,800 233
Skandia Forsakrings AB 13,900 51 10,100 37 24,000 88
Skanska AB 11,000 97 4,300 38 15,300 135
SKF AB-A Shares * - 200 8 200 8
SKF AB-B Shares * - 1,000 39 1,000 39
SSAB Svenskt Stal AB, Series A * - 600 11 600 11
SSAB Svenskt Stal AB, Series B * - 200 3 200 3
Svenska Cellulosa AB 3,100 127 2,300 94 5,400 221
Svenska Handelsbanken AB, B Shares * - 600 12 600 12
Svenska Handelsbanken, Inc. 9,300 190 6,400 131 15,700 321
Swedish Match AB * - 4,000 41 4,000 41
Telefonaktiebolaget LM Ericsson AB 246,500 442 172,700 310 419,200 752
Telia AB 30,044 157 18,900 99 48,944 256
Trelleborg AB * - 800 13 800 13
Volvo AB, A Shares * - 1,100 32 1,100 32
Volvo AB, B Shares * 5,750 176 2,700 83 8,450 259
WM Data AB, B shares * - 2,000 4 2,000 4
------- ------- -------
2,773 1,948 4,721
Switzerland - 6.2% #
ABB, Ltd. 21,138 107 20,155 102 41,293 209
Adecco SA * 2,733 176 1,537 99 4,270 275
Ciba Specialty Chemicals AG * 1,667 129 805 62 2,472 191
Clariant AG * - 1,531 23 1,531 23
Credit Suisse Group * 21,266 778 13,867 507 35,133 1,285
Geberit AG * - 40 20 40 20
Givaudan 224 116 88 46 312 162
Holcim * 3,096 144 1,590 74 4,686 218
Kudelski SA * - 405 13 405 13
Kuoni Reisen Holding AG * - 34 11 34 11
Logitech International SA * - 513 22 513 22
Lonza Group AG 1,604 92 520 30 2,124 122
Nestle SA * 6,988 1,745 4,709 1,176 11,697 2,921
Novartis AG 41,256 1,872 27,769 1,260 69,025 3,132
Richemont 10,552 253 6,071 146 16,623 399
Roche Holdings AG 746 103 367 51 1,113 154
Roche Holdings AG * 11,960 1,206 8,195 826 20,155 2,032
Schindler Holding AG * - 63 15 63 15
Serono SA 156 111 81 58 237 169
SGS Holdings 119 75 50 31 169 106
Sulzer AG * - 38 10 38 10
Swatch Group 1,021 123 394 47 1,415 170
Swatch Group AG * - 573 14 573 14
Swiss Reinsurance Co. * 5,579 377 3,738 252 9,317 629
Swisscom AG * 541 178 306 101 847 279
Syngenta AG 2,037 137 1,226 83 3,263 220
Synthes-Stratec, Inc. 109 108 50 50 159 158
Tecan Group AG * - 79 4 79 4
UBS AG * 20,534 1,406 13,770 943 34,304 2,349
Unaxis Holding AG * - 130 18 130 18
Valora Holding AG 321 80 46 12 367 92
Zurich Finance 2,571 370 1,671 240 4,242 610
------ -------- -------
9,686 6,346 16,032
Taiwan - 0.6% #
Acer Communicaton 22,800 28 22,800 28
Acer, Inc. 44,963 67 44,963 67
Advanced Semiconductor Engineering, Inc. 64,900 67 64,900 67
Arima Computer 49,500 18 49,500 18
Asustek Computer 20,250 45 20,250 45
AU Optronics Corp. 55,650 65 55,650 65
China Dev Fin Holding 144,203 71 144,203 71
China Trust Finance 79,920 80 79,920 80
CMC Magnetics Corp. 51,600 40 51,600 40
Compal Electronics, Inc. 44,160 60 44,160 60
Formosa Chemical & Fibre 32,054 54 32,054 54
Formosa Plastic 52,956 87 52,956 87
Hon Hai Precision Insustry Co., Ltd. 20,700 81 20,700 81
Kinpo Electronics 69,608 40 69,608 40
Lite on Technology 48,056 51 48,056 51
Macronix International Co., Ltd. 59,400 13 59,400 13
Micro Star International 9,176 14 9,176 14
Nan Ya Plastic Corp. 83,824 121 83,824 121
Quanta Computer, Inc. 16,445 40 16,445 40
Realtek Semiconductor Corp. 10,920 19 10,920 19
Ritek Corp. 45,000 28 45,000 28
Siliconware Precision 44,000 45 44,000 45
Taiwan Semiconductor 173,880 325 173,880 325
Tatung 100,000 25 100,000 25
United Microelectronics Corp. 83,525 72 83,525 72
Via Technologies Inc. 14,090 18 14,090 18
Winbond Electronic 69,000 33 69,000 33
--------- -----
1,607 1,607
Thailand - 0.2% #
Advanced Information Services 65,700 140 65,700 140
PTT Exploration & Production Public Co., Ltd. 22,200 150 22,200 150
Siam Cement Co. 31,600 220 31,600 220
--------- -----
510 510
Turkey - 0.1% #
Arcelik AS 6,490,550 36 6,490,550 36
Turkiye Is Bankasi ######### 285 70,216,241 285
--------- -----
321 321
United Kingdom - 21.9% #
3i Group PLC * 11,775 130 7,072 78 18,847 208
Aegis Group PLC * - 13,367 23 13,367 23
Aggreko PLC * - 3,035 8 3,035 8
Alliance Unichem 7,717 71 2,952 27 10,669 98
AMEC PLC * - 3,798 18 3,798 18
Amvescap plc * 13,224 96 7,939 58 21,163 154
ARM Holdings PLC * - 11,849 27 11,849 27
Association British Ports 11,901 95 3,613 29 15,514 124
AstraZeneca Group PLC * 30,224 1,446 19,917 953 50,141 2,399
Barclays 110,773 985 76,452 680 187,225 1,665
Barratt Developments * - 3,002 29 3,002 29
BBA Group PLC * - 5,542 25 5,542 25
BG Group plc 64,498 330 41,085 210 105,583 540
BICC PLC * - 5,099 20 5,099 20
Billiton plc 44,847 391 28,788 251 73,635 642
BOC Group plc * 17,596 268 5,760 88 23,356 356
Boots Group 15,100 186 9,129 113 24,229 299
BP Amoco plc 410,567 3,320 257,874 2,085 668,441 5,405
BPB 12,089 75 6,111 38 18,200 113
Brambles Industries 22,730 83 8,380 30 31,110 113
British Aerospace plc 57,462 173 35,757 107 93,219 280
British Airport Authority plc 21,926 194 12,429 110 34,355 304
British Airways * - 6,466 27 6,466 27
British American Tobacco plc * 29,280 402 18,433 253 47,713 655
British Land Co. plc 9,000 94 5,721 60 14,721 154
British Sky Broadcast plc 23,449 294 14,667 184 38,116 478
BT Group 153,664 516 100,873 339 254,537 855
Bunzl 12,430 95 5,477 42 17,907 137
Cable & Wireless plc * 48,728 116 27,996 67 76,724 183
Cadbury Schweppes plc * 37,586 275 23,980 176 61,566 451
Canary Wharf Group PLC * - 5,703 27 5,703 27
Capita Group plc 17,669 77 8,112 35 25,781 112
Carlton Communications PLC * 13,900 57 7,353 30 21,253 87
Carnival plc 3,303 133 1,813 73 5,116 206
Cattles PLC * - 3,600 21 3,600 21
Celltech Group PLC * - 3,348 23 3,348 23
Centrica plc 76,232 287 49,380 186 125,612 473
CGU plc 37,687 330 26,273 230 63,960 560
Close Brothers Group PLC * - 1,520 20 1,520 20
Cobham PLC * - 1,279 27 1,279 27
Compass Group plc * 39,189 266 25,420 172 64,609 438
Daily Mail & General Trust 7,508 88 3,372 40 10,880 128
Davis Service 11,677 78 2,454 16 14,131 94
De Lousiana Rue PLC * - 1,732 9 1,732 9
Diageo plc * 53,890 707 36,167 474 90,057 1,181
Dixons Group plc 42,741 106 22,056 55 64,797 161
Electrocomponents plc * 12,098 70 5,197 30 17,295 100
EMAP plc * 6,164 94 3,071 47 9,235 141
EMI Group plc 9,000 26 8,998 25 17,998 51
Enterprise Inns PLC * 5,116 93 2,048 37 7,164 130
Exel * 7,462 98 3,413 45 10,875 143
Firstgroup 12,870 63 5,028 25 17,898 88
FKI PLC * - 7,192 14 7,192 14
Friends Provident Ethical Investment Trust * - 19,556 46 19,556 46
George Wimpey PLC * - 4,233 28 4,233 28
GKN * 17,633 84 8,575 41 26,208 125
GlaxoSmithKline plc * 104,018 2,377 69,551 1,589 173,569 3,966
Granada Compass PLC * 57,831 126 32,121 70 89,952 196
Great Portland Estates PLC * - 2,022 8 2,022 8
Hammerson plc 8,028 93 3,372 39 11,400 132
Hanson Building Materials * 8,990 66 7,856 58 16,846 124
Hanson PLC * - 387 3 387 3
Hays plc * 41,349 89 19,215 41 60,564 130
HBOS * 65,987 852 44,752 578 110,739 1,430
HHG Plc * 17,632 13 17,632 13
Hilton Group plc * 27,700 111 18,792 75 46,492 186
HSBC Holdings plc 182,550 2,861 126,924 1,989 309,474 4,850
IMI 11,248 68 3,852 23 15,100 91
Imperial Chemical Industries plc * 26,199 93 13,726 49 39,925 142
Imperial Tobacco Group plc 13,917 273 8,486 167 22,403 440
Intercontinental Hampshire 15,693 148 7,279 69 22,972 217
Invensys PLC * - 37,344 12 37,344 12
J Sainsbury plc 28,966 162 16,844 94 45,810 256
Johnson Matthey 5,434 95 2,543 45 7,977 140
Kelda Group plc 10,845 91 4,576 38 15,421 129
Kesa Electricals PLC * - 6,582 30 6,582 30
Kidde PLC * - 10,723 20 10,723 20
Kingfisher * 42,693 212 24,891 124 67,584 336
Land Securities SGP 7,350 130 5,449 96 12,799 226
Legal & General Group plc 105,588 189 75,519 135 181,107 324
Liberty National 6,968 85 2,800 34 9,768 119
Lloyds TSB Group PLC 118,179 945 65,085 520 183,264 1,465
Logica plc * 16,105 74 8,713 40 24,818 114
Manitoba Group 5,609 146 3,213 84 8,822 230
Marks & Spencer * 42,777 221 26,272 136 69,049 357
MFI Furniture Group * - 6,400 17 6,400 17
Misys plc 13,522 51 6,675 25 20,197 76
Mitchells & Butler 5,981 24 5,962 24 11,943 48
National Grid Group * 53,002 379 35,753 255 88,755 634
National Power PLC 14,200 31 13,485 30 27,685 61
Next Group 6,142 123 3,228 65 9,370 188
Novar PLC * - 4,484 11 4,484 11
Nycomed Amersham plc 14,138 193 8,148 111 22,286 304
Pearson PLC 15,605 173 9,283 103 24,888 276
Peninsular & Oriental Steam Navigation Co. 18,718 77 8,260 34 26,978 111
Persimmon PLC * - 3,308 32 3,308 32
Pilkington PLC * - 11,203 19 11,203 19
Provident Financial 6,656 77 2,957 34 9,613 111
Prudential Corp. 34,647 292 23,352 197 57,999 489
Rank Group PLC 25,300 126 6,786 34 32,086 160
Reckitt Benckiser 11,385 257 7,008 158 18,393 415
Reed International plc 44,446 371 14,719 123 59,165 494
Rentokil Initial plc 39,081 133 21,573 73 60,654 206
Reuters Group plc 29,157 122 16,417 69 45,574 191
Rexam 11,775 90 6,280 48 18,055 138
Rio Tinto plc 18,738 516 12,426 342 31,164 858
RMC Group plc 6,457 80 2,981 37 9,438 117
Rolls Royce Group 30,599 97 15,792 50 46,391 147
Royal & Sun Alliance Insurance Group 60,060 95 33,221 52 93,281 147
Royal Bank of Scotland Group 48,532 1,426 32,593 958 81,125 2,384
Safeway plc 23,118 117 12,614 64 35,732 181
Schroders PLC * - 1,626 18 1,626 18
Scottish & Newcastle 18,779 127 9,340 63 28,119 190
Scottish and Southern Energy 16,614 200 9,965 120 26,579 320
Scottish Power plc 34,695 231 21,568 143 56,263 374
Securicor * - 5,150 9 5,150 9
Serco Group PLC * - 4,450 14 4,450 14
Severn Trent 8,253 110 4,138 55 12,391 165
Shell Transport & Trading Co. plc 189,806 1,408 112,828 837 302,634 2,245
Signet Group 42,561 78 19,627 36 62,188 114
Slough Estates Finance plc 8,000 63 4,788 38 12,788 101
Smith & Nephew 19,151 160 10,791 90 29,942 250
Smiths Group 11,076 131 6,513 77 17,589 208
South African Breweries plc 15,790 163 9,259 96 25,049 259
SSL International PLC * - 2,478 15 2,478 15
Stagecoach Holdings PLC * - 11,469 16 11,469 16
Tate & Lyle 12,545 70 4,898 27 17,443 97
Taylor Woodrow 17,488 83 6,527 31 24,015 114
Tesco plc 127,371 586 85,336 393 212,707 979
The Berkeley Group PLC * - 1,243 19 1,243 19
The Great Universal Stores plc 19,002 262 11,775 163 30,777 425
The Sage Group plc 15,700 49 14,258 45 29,958 94
Tomkins plc 18,702 89 9,260 44 27,962 133
Unilever plc 49,648 462 32,221 300 81,869 762
United Business Media 8,630 75 3,864 34 12,494 109
United Utilities plc 10,400 92 6,616 59 17,016 151
United Utilities PLC, Class A * - 3,432 19 3,432 19
Vodafone AirTouch plc 1,203,067 2,974 795,070 1,966 1,998,137 4,940
Whitbread 7,465 96 3,452 44 10,917 140
William Hill PLC * - 4,885 37 4,885 37
Wolseley 11,481 162 6,819 96 18,300 258
WPP Group plc 22,552 221 13,730 134 36,282 355
Yell Group PLC * - 5,218 28 5,218 28
-------- -------- --------
34,541 22,141 56,682
United States - 1.6% #
Bajaj Auto, Ltd. - GDR 5,900 143 - 5,900 143
Banco Bradesco - ADR 2,918 77 - 2,918 77
Banco Itau SA - ADR 3,960 197 - 3,960 197
Banco Santander Chile - ADR 2,900 69 - 2,900 69
Brasil Telecom Participacoes S.A. 2,426 91 - 2,426 91
Carnival Corp. 180 7 - 180 7
Centrais Electricas Brasileirias SA - ADR Cl.B * 12,874 101 - 12,874 101
Check Point Software Technologies, Ltd. * 4,200 71 - 4,200 71
Companhia De Bebidas ADR 6,850 175 - 6,850 175
Companhia Energetica de Minas Gerias - ADR 7,701 141 - 7,701 141
Companhia Vale do Rio Doce 3,700 189 - 3,700 189
Compania Cervecerias Unidas SA - ADR * 900 19 - 900 19
Compania de Telecomunicaciones de Chile SA * 2,500 37 - 2,500 37
EIH, Ltd. - GDR 6,700 44 - 6,700 44
Embotelladora Andina SA - ADR * 6,100 64 - 6,100 64
Empresa Nacional de Electricidad SA - ADR * 10,100 118 - 10,100 118
Enersis SA - ADR * 28,447 209 - 28,447 209
Gen-Probe, Inc. * - 344 13 344 13
Grasim Industries, Ltd. - GDR 7,100 156 - 7,100 156
Great Eastern Shipping Co. - GDR 9,020 152 - 9,020 152
Hindalco Industries, Ltd. - GDR 4,900 151 - 4,900 151
Huaneng Power International, Inc. - ADR * 400 28 - 400 28
ITC, Ltd. - GDR 5,900 130 - 5,900 130
Lukoil Holding - ADR* 2,700 251 - 2,700 251
Mahindra & Mahindra, Ltd. * 16,500 141 - 16,500 141
Petroleo Brasileiro SA * 5,500 160 - 5,500 160
Petroleo Brasileiro SA - ADR* 6,800 180 - 6,800 180
Ranbaxy Laboratories, Ltd. - GDR 6,560 167 - 6,560 167
Reliance Industries, Ltd. - GDR 11,000 276 - 11,000 276
Surgutneftegaz - ADR 11,581 337 - 11,581 337
Tatneft - ADR 2,400 55 - 2,400 55
Unified Energy Systems Russia - ADR 6,700 187 - 6,700 187
--------- ---------- ---------
4,123 13 4,136
--------- ---------- ---------
TOTAL COMMON STOCK # 54,282 85,433 239,715
PREFERRED STOCK
Australia - 0.2% #
News Corp., Ltd. 53,728 404 23,372 176 77,100 580
Germany - 0.2% #
Fresenius Medical Care AG * - 325 16 325 16
Henkel KGAA 1,112 87 1,112 87
Porsche AG 195 116 90 53 285 169
RWE AG * - 408 14 408 14
Volkswagen AG 2,462 89 1,226 45 3,688 134
--------- ---------- ---------
292 128 420
Italy - 0.0% #
Fiat SPA - PRIV EUR * 849 4 849 4
New Zealand - 0.0% #
Fletcher Challenge * 1,940 2 1,940 2
South Korea - 0.0% #
Samsung Electronics 550 113 550 113
--------- ---------- ---------
TOTAL PREFERRED STOCK # 809 310 1,119
WARRANTS
Mexico - 0.0% #
Cemex SA
expire 12/21/04 (Cost $1) 2,000 1 2,000 1
--------- ---------
TOTAL WARRANTS # 1 1
RIGHTS
Germany - 0.0% #
Muenchener Ruckversage
expires 11/10/03 (Cost $0) 4,360 38 4,360 38
Thailand - 0.0% #
TelecomAsia
expires 04/30/08 (Cost $0) 35,747 - 35,747 -
--------- ---------- ---------
TOTAL RIGHTS # 38 38
PAR VALUE PAR VALUE PAR VALUE
(000'S (000'S (000'S
OMITTED) OMITTED) OMITTED)
COLLATERAL ON LOANED SECURITIES - 7.1%
State Street Navigator Securitiees Lending
Portfolio $ 8,571 8,571 9,718 9,718 18,289 18,289
SHORT TERM INVESTMENTS
Investment in joint trading account
1.061% due 01/02/04 2,955 2,955 2,955 2,955
Federal National Mortgage
Association Discount Notes,
1.05% due 01/07/2004 2,300 2,300 2,300 2,300
1.06% due 02/18/2004 6,700 6,690 6,700 6,690
U.S Treasury Bills
0.00% due 01/22/2004 500 500 500 500
0.99% due 03/11/2004 524 524 524 524
--------- ---------- ---------
TOTAL SHORT TERM INVESTMENTS # 3,479 9,490 12,969
REPURCHASE AGREEMENTS #
Repurchase Agreement with State Street
Corp. dated 12/31/2003 at 0.70%, to be
repurchased at $3,931,153 on 01/02/2004,
col1ateralized by $281,000 U.S. Treasury
Bonds, 8.50% due 02/15/2020 (valued at
$4,013,031, including interest)
TOTAL REPURCHASE AGREEMENTS # 3,931 3,931 3,931 3,931
---------- ---------
3,931 3,931
TOTAL INVESTMENTS AT MARKET # 167,180 108,882 276,062
TOTAL INVESTMENTS AT COST 142,128 87,510 229,638
Payables, less cash and receivables # (8,144) (9,506) (17,650)
--- --------- ---------- ---------
NET ASSETS # 159,036 99,376 258,412
=== ========= ========== =========
* Non-income producing security.
ADR-American Depository Receipt.
GDR-Global Depository Receipt.
PART C
OTHER INFORMATION
Item 15. Indemnification
In response to this item and the requirements of Rule 484 under the
Securities Act of 1933, Registrant incorporates by reference herein its response
to item 25 in Post-Effective Amendment No. 37 to Form N-1A (File No. 33-2081)
filed on May 1, 2003.
Item 16. Exhibits
(1)(a) Declaration of Trust of John Hancock Variable Series Trust I, dated
February 21, 1988, incorporated by reference herein to Pre-Effective Amendment
No. 2 to Form N-14 (File No. 333-47686) filed on December 6, 2000.
(1)(b) Amendment dated May 2, 2003 to the Declaration of Trust,
incorporated by reference herein to Post-Effective Amendment No. 38 to Form N-1A
(File No. 33-2081), filed on June 3, 2003.
(1)(c) Amendments dated September 24 and March 24, 2004 to the Declaration
of Trust (filed herewith).
(2) By-Laws of John Hancock Variable Series Trust I, adopted April 12,
1988, and amended and restated as of September 18, 2002, incorporated by
reference herein to Post-Effective Amendment No. 37 to Form N-1A (File No.
33-2081) filed on May 1, 2003.
(3) Not Applicable.
(4) Form of Agreement and Plan of Reorganization (included as exhibit A to
the proxy statement/prospectus filed as part of this Registration Statement).
(5) Not Applicable.
(6)(a) Investment Management Agreement by and between John Hancock
Variable Series Trust I and John Hancock Life Insurance Company dated April 12,
1988 relating to the Real Estate Equity Fund and the International Equity Index
(formerly "International Equities," formerly "International," originally
"Special Opportunities") Fund, incorporated by reference herein to
Post-Effective Amendment No. 3 to Form N-1A (File No. 33-2081) filed on April,
12 1988.
(6)(b) Amendment No. 1 dated May 1, 1997 to Investment Management
Agreement by and between John Hancock Variable Series Trust I and John Hancock
Life Insurance Company dated April 12, 1988, incorporated by reference herein,
to Post-Effective Amendment No. 16 to Form N-1A (File No. 33-2081) filed on May
1, 1997.
(6)(c) Amendment No. 2 dated May 1, 1998 to Investment Management
Agreement by and between John Hancock Variable Series Trust I and John Hancock
Life Insurance Company dated April 12, 1988 relating to the International Equity
Index Fund, incorporated by reference
herein to Post-Effective Amendment No. 19 to Form N-1A (File No. 33-2081) filed
on May 1, 1998.
(6)(d) Amendment No. 3 dated April 23, 1999 to Investment Management
Agreement by and between John Hancock Variable Series Trust I and John Hancock
Life Insurance Company dated April 12, 1988, incorporated by reference herein to
Post-Effective Amendment No. 33 to Form N-1A (File No. 33-2081 ) filed on April
12, 2002.
(6)(e) Supplement dated June 1, 2004 to Investment Management
Agreement by and between John Hancock Variable Series Trust and John Hancock
Life Insurance Company dated April 12, 1988 (filed herewith).
(6)(f) Form of Amendment No. 6 dated May 1, 2004 to Investment Management
Agreement by and between John Hancock Variable Series Trust and John Hancock
Life Insurance Company dated April 12, 1988 (filed herewith).
(6)(g) Sub-Investment Management Agreement, dated as of May 29, 2004,
among John Hancock Variable Series Trust I, SSgA Funds Management, Inc., and
John Hancock Life Insurance Company relating to the International Equity Index
Fund (filed herewith).
(7)(a) Amended and Restated Underwriting and Indemnity Agreement among
John Hancock Variable Series Trust I, Signator Investors, Inc., and John Hancock
Life Insurance Company, dated March 24, 2004 (filed herewith).
(7)(b) Form of Distribution Agreement dated between John Hancock Variable
Series Trust and Manufacturers Financial Securities, LLC (filed herewith).
(8) Not Applicable.
(9)(a) Custodian Agreement between John Hancock Variable Series Trust I
and State Street Bank and Trust Company, dated January 30, 1995, incorporated by
reference herein to Post-Effective Amendment No. 10 to Form N-1A (File No.
33-2081) filed on March 2, 1995.
(9)(b) Form of Amendment, dated as of April 10, 2003, to Custodian
Agreement dated January 30, 1995, as amended, between John Hancock Variable
Series Trust I and State Street Bank and Trust Company, incorporated by
reference herein to Post-Effective Amendment No. 38 to Form N-1A (File No.
33-2081) filed on June 3, 2003.
(10)(a) Rule 12b-1 Plan dated March 24, 2004 for Series I and II shares
(filed herewith).
(10)(b) Rule 18f-3 Plan dated February 11, 2004 (filed herewith).
(10)(c) Amendment dated March 24, 2004 to Rule 18f-3 Plan dated February
11, 2004 (filed herewith).
(11) Opinion and consent of Ronald J. Bocage, Esq. as to legality of
securities for International Equity Index Fund (to be filed by amendment).
(12) Opinion of Dykema Gossett PLLC on tax matters (to be filed by
amendment).
(13) Not Applicable.
(14)(a) Consent of Dykema Gossett PLLC (to be filed by amendment).
(14)(b) Consent of Ernst & Young LLP (to be filed by amendment).
(14)(c) Consent of PricewaterhouseCoopers, LLP (to be filed by amendment).
(15) Not Applicable.
(16) Powers of Attorney for Elizabeth G. Cook, Kathleen F. Driscoll, Diane
C. Kessler, Michele G. Van Leer, Hassell H. McClellan, and Robert F. Verdonck
(filed herewith).
(17)(a) Form of Prospectus of the International Equity Index Fund of the
John Hancock Variable Series Trust I dated May 1, 2004 (to be filed by
amendment).
(17)(b) Prospectus of Manufacturers Investment Trust dated May 1, 2004 (to
be filed by amendment).
(17)(c) Annual Report of the International Equity Index Fund of John
Hancock Variable Series Trust I for the year ended December 31, 2003 (filed
herewith).
(17)(d) Annual Report of Manufacturers Investment Trust for the year ended
December 31, 2003 (filed herewith).
(17)(e) Form of Participation Agreement between John Hancock Variable
Series Trust I, John Hancock Life Insurance Company, and John Hancock Variable
Life Insurance company (filed herewith).
(17)(f) Form of Participation Agreement between John Hancock Variable
Series Trust I, The Manufacturers Life Insurance Company (U.S.A.), and The
Manufacturers Life Insurance Company of New York (filed herewith).
Item 17. Undertakings
(1) The undersigned Registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is a part of
this registration statement by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c) of the Securities Act [17 CFR
230.145c], the reoffering prospectus will contain the information called for by
the applicable registration form for reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other items of
the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as a part of an amendment to the
registration statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the
securities offered therein, and the offering of the securities at that time
shall be deemed to be the initial bona fide offering of them.
SIGNATURES
As required by the Securities Act of 1933, this registration statement has been
signed on behalf of the Registrant, in the City of Boston and the Commonwealth
of Massachusetts, on the 30th day of March, 2004.
JOHN HANCOCK VARIABLE SERIES TRUST I
By: /s/ Michele Van Leer
---------------------------------
Name: Michele G. Van Leer
Title: Chairman of the Board of
Trustees
As required by the Securities Act of 1933, this registration statement has been
signed by the following persons in the capacities and on the date indicated.
SIGNATURE DATE
By: /s/ Raymond F. Skiba
--------------------------------- March 30, 2004
Raymond F. Skiba
Treasurer (Principal Financial
and Accounting Officer)
By: /s/ Michele Van Leer
--------------------------------- March 30, 2004
Michele G. Van Leer
Chairman of the Board of Trustees
(Principal Executive Officer)
For herself and as attorney-in-fact for:
Elizabeth G. Cook, Trustee
Diane C. Kessler, Trustee
Robert F. Verdonck, Trustee
Hassell H. McClellan, Trustee
Kathleen F. Driscoll, Trustee