-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, ju5NlGTXXMw6QGu/aCrOws2yeolcbLWz0cwXiP2OPzHAuaKUrpWk7DReZ3+oqpMl xV+3nt/gknokrXDGgvFYfQ== 0000017147-95-000001.txt : 19950302 0000017147-95-000001.hdr.sgml : 19950302 ACCESSION NUMBER: 0000017147-95-000001 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19950228 EFFECTIVENESS DATE: 19950228 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAPITAL EXCHANGE FUND INC CENTRAL INDEX KEY: 0000017147 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 042385053 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-01339 FILM NUMBER: 95515924 BUSINESS ADDRESS: STREET 1: 24 FEDERAL ST CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174828260 MAIL ADDRESS: STREET 1: ONE BEACON ST CITY: BOSTON STATE: MA ZIP: 02108 485BPOS 1 CAPITAL EXCHANGE N1A As filed with the Securities and Exchange Commission on February 27, 1995 1940 Act File No. 811-1339 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM N-lA REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X Amendment No. 18 X CAPITAL EXCHANGE FUND, INC. (Exact Name of Registrant as Specified in Charter) 24 Federal Street, Boston, Massachusetts 02110 (Address of Principal Executive Offices) (617) 482-8260 (Registrant's Telephone Number including Area Code) THOMAS OTIS, Clerk 24 Federal Street, Boston, Massachusetts 02110 (Name and address of agent for service) Page 1 of pages. PART A INFORMATION REQUIRED IN A PROSPECTUS Responses to Items 1, 2, 3 and 5(a) have been omitted pursuant to Paragraph 4 of Instruction F of the General Instructions to Form N-1A. Item 4. General Description of Registrant No change from the information set forth in Item 4 of Form N-lA, filed as Amendment No. 8 to the Registration Statement under the Investment Company Act of 1940 (the "1940 Act"), File No. 811-1339, which information is incorporated herein by reference. Item 5. Management of the Fund (b) (i) Eaton Vance Management ("Eaton Vance") 24 Federal Street Boston, Massachusetts 02110 Eaton Vance, its affiliates and its predecessors have more than 60 years experience in the investment management field, and Eaton Vance or its affiliates currently acts as investment adviser and/or provides administrative and management services to investment companies and various individual and institutional clients with combined assets under management of approximately $15 billion. Eaton Vance is a wholly-owned subsidiary of Eaton Vance Corp. ("EVC"), a publicly-held holding company which through subsidiaries and affiliates is engaged in investment management and marketing activities, real estate investment, consulting and management, oil and gas operations, fiduciary and banking services and development of precious metal properties. (ii) Pursuant to the Investment Advisory Agreement, Eaton Vance provides investment advisory and administrative services and is responsible for overall management of Registrant's business affairs subject to the direction of and control by the Board of Directors. (iii) The Registrant pays the adviser a monthly fee of 5/96 of 1% (equivalent to 5/8 of 1% annually) of the average monthly net assets of the Registrant throughout the month. The fee for the fiscal year ended October 31, 1994 was $559,424 (equivalent to 5/8 of 1% of Registrant's average net assets for the year). Item 5. Continued (c) Duncan W. Richardson has acted as the Registrant's portfolio manager since 1990. Mr. Richardson is a Vice President of Eaton Vance and has been employed by Eaton Vance since 1987. (d) Not applicable (e) The transfer and dividend disbursing agent is The Shareholder Services Group, Inc., BOS725, P. 0. Box 1559, Boston, Massachusetts 02104. (f) The Registrant's ratio of expenses to average net assets for the fiscal year ended October 31, 1994 was 0.76%. (g) Not applicable Item 6. Capital Stock and Other Securities No change from the information set forth in Item 6 of Form N-1A, filed as Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herein by reference. Item 7. Purchase of Securities Being Offered Inapplicable. Registrant has not offered its shares for sale subsequent to its initial public offering in 1965. Item 8. Redemption or Repurchase of Registrant's Shares A shareholder has the right to redeem fund shares by delivering to The Shareholder Services Group, Inc., BOS725, P. 0. Box 1559, Boston, MA 02104, either share certificates, or a stock power if no certificates have been issued, in good order for transfer, with a separate written request for redemption. Redemption will be made at the net asset value next computed after such delivery. Good order means that the certificates or stock powers must be endorsed by the record owner(s) exactly as the shares are registered and the signature(s) must be guaranteed by a member of either the Securities Transfer Association's STAMP program or the New York Stock Exchange's Medallion Signature Program, or certain banks, savings and loan institutions, credit unions, securities dealers, securities exchanges, clearing agencies and registered securities associations acceptable to The Shareholder Services Group, Inc. In addition, in some cases, good order may require the furnishing of additional documents such as where shares are registered in the name of a corporation, partnership or fiduciary. Payment will be made within seven days of the receipt of the aforementioned documents. Item 8. Continued In addition to the redemption of shares in the manner described above, the Registrant, for the convenience of its shareholders, has authorized Eaton Vance to act as its agent in the repurchase of shares. Eaton Vance will normally accept orders to repurchase shares by wire or telephone from investment dealers for their customers at the net asset value next computed after receipt of the order by the dealer if such order is received by Eaton Vance prior to its close of business that day. It is the dealer's responsibility to promptly transmit the repurchase order to Eaton Vance. These repurchase arrangements do not involve a charge to the shareholder by either the Registrant or its agent; however, investment dealers may make a charge to the shareholder. Payment will be made within seven days of the receipt of an order to repurchase provided that the certificates, or a stock power if no certificates have been issued, have been delivered to The Shareholder Services Group, Inc. in good order as described above. The Registrant reserves the right to pay the redemption or repurchase price in whole or in part by a distribution of portfolio securities in lieu of cash if, in the opinion of management, it seems advisable to do so; normally, when the redemption or repurchase price equals or exceeds $2,500 portfolio securities will be used by the Registrant. Any portfolio securities so distributed will be valued at the figure at which they were appraised in computing the net asset value of Registrant's shares. If the portfolio securities so distributed are sold by the redeeming shareholder he will incur brokerage commissions or other transaction costs in connection with such sale. The net asset value is determined by Investors Bank & Trust Company ("IBT")(as agent for the Registrant) in the manner authorized by the Directors of the Registrant. Briefly, this determination is made as of the close of trading (normally at 4:00 P.M. New York time) on the New York Stock Exchange (the "Exchange") each business day on which the Exchange is open for trading, and is accomplished by dividing the number of outstanding shares of the Registrant into its net worth (the excess of its assets over its liabilities). Investments listed on national securities exchanges or in the NASDAQ National Market are valued at closing sale prices. Listed or unlisted investments for which closing sale prices are not available are valued at the closing bid prices. Short-term obligations, maturing in sixty days or less, are valued at amortized cost, which approximates value. Item 9. Pending Legal Proceeding Not applicable PART B INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION Item 10. Cover Page Inapplicable Item 11. Table of Contents Inapplicable Item 12. General Information and History Inapplicable Item 13. Investment Objectives and Policies (a) The responses to Item 4 hereof are incorporated herein by reference. (b) No change from the information set forth in Item 13(b) of Form N-1A, filed as Post-Effective Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339 and incorporated herewith by reference. (c) Not applicable (d) The Registrant has not had a significant variation in the portfolio turnover rate for the past two years and does not anticipate there will be any significant variation in the future. Item 14. Management of the Fund The Registrant's Directors and officers are listed below. Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. Unless otherwise noted, the business address of each Director and officer is 24 Federal Street, Boston, Massachusetts, 02110, which is also the address of the Registrant's investment advisor, Eaton Vance Management ("Eaton Vance"); Eaton Vance's wholly-owned subsidiary, Boston Management and Research ("BMR"); Eaton Vance's parent, Eaton Vance Corp. ("EVC"); and of Eaton Vance's and BMR's Trustees, Eaton Vance, Inc. ("EV"). Eaton Vance and EV are both wholly-owned subsidiaries of EVC. Those directors and officers who are "interested persons" of the Registrant, Eaton Vance, BMR, EVC, or EV as defined in the 1940 Act, by virtue of their affiliation with or stockholdings of any one or more of, the registrant, Eaton Vance, BMR, EVC or EV are indicated by an asterisk(*). Item 14. (a) and (b) (1) (2) (3) Position Held Principal Occupations Name and Address with Registrant during Past 5 Years Landon T. Clay* President & Chairman of the Board and Age: 68 Director Director of EVC and EV; Chairman, Eaton Vance, and BMR Donald R. Dwight Director President Dwight Partners, Age: 64 Inc. (since 1988) (a corporate Clover Mill Lane relations and communications Lyme, New Hampshire company); Chairman of the Board of Newspapers of New England, Inc. (since 1983) Samuel L. Hayes, III Director Jacob H. Schiff, Professor Age: 60 of Investment Banking- Harvard Graduate School of Harvard Graduate School of Business Administration Business Administration Soldiers Field Road Boston, Massachusetts Peter F. Kiely* Vice President & Vice President, Eaton Vance, Age: 58 Director (since BMR and EV 12/16/91) Norton H. Reamer Director President and Director, Age: 59 United Asset Management One International Place Corporation, a holding, Boston, Massachusetts company owning institutional investment management firms; Chairman, President and Director, The Regis Fund, Inc. (mutual fund); Trustee, Union College (since January 1990) John L. Thorndike Director Director, Fiduciary Trust Age: 68 Company 175 Federal Street Boston, Massachusetts Jack L. Treynor Director Investment Adviser and Age: 64 Consultant 504 Via Almar Palos Verdes Estates, California Item 14. (a) and (b) Continued (1) (2) (3) Position Held Principal Occupations Name and Address with Registrant during Past 5 Years James B. Hawkes* Vice President Executive Vice President Age: 53 and Director, EVC and EV; Executive Vice President of Eaton Vance and BMR Duncan W. Richardson* Vice President Vice President, Eaton Age: 38 Vance, EV and BMR Thomas Otis* Clerk Vice President and Age: 63 Secretary, EVC, Eaton Vance EV and BMR James L. O'Connor* Treasurer Vice President, Eaton Age: 49 Vance, EV and BMR Janet E. Sanders* Assistant Treasurer Vice President, Eaton Age: 59 & Assistant Clerk Vance, EV and BMR (since 2/26/90) James F. Alban* Assistant Treasurer Assistant Vice President, Age: 33 (since 12/16/91) Eaton Vance and EV (since 1/17/92) and BMR (since 8/11/92; employee of Eaton Vance (since 9/23/91); Tax Consultant and Audit Senior with Deloitte & Touche LLP (1987-1991) Messrs. Thorndike (Chairman), Hayes and Reamer are members of the Special Committee of the Board of Directors of the Registrant. The Special Committee's functions include a continuous review of the Registrant's investment advisory agreement with the investment adviser, making recommendations to the Board regarding the compensation of those Directors who are not members of the investment adviser's organization, and making recommendations to the Board regarding candidates to fill vacancies, as and when they occur, in the ranks of those Directors who are not "interested persons" of the Registrant or the investment adviser. Messrs. Treynor (Chairman) and Dwight are members of the Audit Committee of the Board of Directors. The Audit Committee's functions include making recommendations to the Board regarding the selection of the independent public accountants, and reviewing with such accountants and the Treasurer of the Registrant matters relative to accounting and auditing practices and procedures, accounting records, internal accounting controls, and the functions performed by the custodian, transfer agent and dividend disbursing agent of the Registrant. Item 14. (c) The fees and expenses of the Directors of the Fund who are not members of the Eaton Vance organization are paid by the Fund. During the fiscal year ended October 31, 1994, Directors of the Fund earned the following compensation in their capacities as Directors from the Fund, and during the year ended December 31, 1994, received the following compensation in their capacities as Directors and/or Trustees of the other funds in the Eaton Vance fund complex: Aggregate Retirement Compensation Benefit Accrued Total Compensation Name from Fund from Fund Complex from Fund Complex(1) Donald R. Dwight $ 1,165 $8,750 $135,000 Samuel L. Hayes, III 1,223 8,865 142,500 Norton H. Reamer 1,239 -0- 135,000 John L. Thorndike 1,302 -0- 140,000 Jack L. Treynor 1,238 -0- 140,000 (1) The Eaton Vance fund complex consists of 201 registered investment companies or series thereof. Directors of the Fund that are not affiliated with the Investment Adviser may elect to defer receipt of all or a percentage of their annual fees in accordance with the terms of a Deferred Compensation Plan (the "Plan"). Under the Plan, an eligible Director may elect to have his deferred fees invested by the Fund in the shares of one or more funds in the Eaton Vance Family of Funds, and the amount paid to the Directors under the Plan will be determined based upon the performance of such investments. Deferral of Directors' fees in accordance with the Plan will have a negligible effect on a Fund's assets, liabilities, and net income per share, and will not obligate the Fund to retain the services of any Director or obligate the Fund to pay any particular level of compensation to the Director. Item 15. Control Persons and Principal Holders of Securities (a) Not applicable (b) As of January 31, 1995, the Directors and officers of the Fund, as a group, owned in the aggregate less than 1% of the outstanding shares of the Registrant. To the knowledge of the Registrant no person of record or beneficially owns 5% or more of its stock, except the following shareholders who owned of record the percentages of outstanding shares indicated after their names as of January 31, 1995: Patterson & Co., Philadelphia, PA (10.8%); Leonard G. Carpenter, C. Curtis Lee and David R. Brink, Trustees U/A dated 11/16/79 Geraldine K. Carpenter Living Trust, Wayzata, MN (9.3%); and Arthur F. Albert, Trustee Arthur F. Albert Trust U/A dated 10/3/78, Glenview, IL (6.1%). Item 16. Investment Advisory and Other Services (a)(i) and (ii) Eaton Vance, its affiliates and its predecessors have more than 60 years experience in the investment management field, and currently acts as investment adviser and/or provides administrative and management services to investment companies and various individual and institutional clients with combined assets under management of approximately $15 billion. Eaton Vance and EV are both wholly-owned subsidiaries of EVC. BMR is a wholly-owned subsidiary of Eaton Vance. Eaton Vance and BMR are both Massachusetts business trusts and EV is the trustee of Eaton Vance and BMR. The Directors of EV are Landon T. Clay, H. Day Brigham, Jr., M. Dozier Gardner, James B. Hawkes, and Benjamin A. Rowland, Jr. The Directors of EVC consist of the same persons and John G. L. Cabot and Ralph Z. Sorenson. Mr. Clay is chairman and Mr. Gardner is president and chief executive officer of EVC, Eaton Vance, BMR and EV. All of the issued and outstanding shares of Eaton Vance and of EV stock are owned by EVC. All of the issued and outstanding shares of BMR are owned by Eaton Vance. All shares of the outstanding Voting Common Stock of EVC are deposited in a Voting Trust which expires December 31, 1996, the Voting Trustees of which are Messrs. Clay, Gardner, Hawkes, Rowland and Brigham. The Voting Trustees have unrestricted voting rights for the election of Directors of EVC. All of the outstanding voting trust receipts issued under said Voting Trust are owned by certain of the officers of Eaton Vance and BMR who are also officers and Directors of EVC and EV. As of January 31, 1995, Messrs. Clay, Gardner and Hawkes each owned 24% of such voting trust receipts. Messrs. Rowland and Brigham owned 15% and 13%, respectively, of such voting trust receipts. Messrs. Clay, Hawkes and Otis, who are officers or Directors of the Registrant, are members of the EVC, Eaton Vance, BMR and EV organizations. Mr. Kiely who is an officer and a Director of the Registrant, is also a member of the Eaton Vance, BMR and EV organizations. Messrs. Alban, Richardson and O'Connor, and Ms. Sanders who are officers of the Registrant, are also members of the Eaton Vance, BMR and EV organizations. See Item 14. (iii) No change from the information set forth in Item 16(a)(iii) of Form N-1A, filed as Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herein by reference. (A) The management fees paid by the Registrant for the fiscal years ended October 31, 1994, 1993 and 1992 were $559,424, $556,564 and $550,441, respectively. (B) and (C) Not applicable (b) No change from the information set forth in Item 16(b) of Form N-1A, filed as Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herein by reference. (c)(d)(e)(f) and (g) Not applicable (h) and (i) Investors Bank & Trust Company ("IBT"), 24 Federal Street, Boston, Massachusetts, (a 77.3% owned subsidiary of EVC) has been the custodian of the Registrant since 1985. IBT has custody of all cash and Item 16. Continued securities of the Registrant, maintains the Registrant's general ledger and computes the daily per share net asset value. In such capacity it attends to details in connection with the sale, exchange, substitution, transfer or other dealings with the Registrant's investments, receives and disburses all funds, and performs various other ministerial duties upon receipt of proper instructions from the Registrant. IBT charges fees which are competitive within the industry. A portion of the fee relates to custody, bookkeeping and valuation services and is based upon a percentage of the Registrant's net assets and a portion of the fee relates to activity charges, primarily the number of portfolio transactions. These fees are then reduced by a credit for cash balances of the particular investment company at the custodian equal to 75% of the 91-day, U.S. Treasury Bill auction rate applied to the particular invstment company's average daily collected balances for the week. In view of the ownership of EVC in IBT, the Registrant is treated as a self-custodian pursuant to Rule 17f-2 under the 1940 Act, and the Registrant's investments held by IBT as custodian are thus subject to additional examinations by the Registrant's independent certified public accountants as called for by such Rule. For the fiscal year ended October 31, 1994, IBT was paid $49,061. Deloitte & Touche LLP, 125 Summer Street, Boston, Massachusetts are the independent certified public accountants for the Registrant. As such they provide customary professional services in connection with the audit function for a management investment company, including services leading to the expression of an opinion on the financial statements in the annual report to shareholders and preparation of the Registrant's Federal tax returns. Item 17. Brokerage Allocation and Other Practices Decisions concerning the execution of Fund portfolio security transactions, including the selection of the market and the broker-dealer firm, are made by Eaton Vance. Eaton Vance is also responsible for the execution of transactions for all other accounts managed by it. Eaton Vance places the portfolio security transactions of the Registrant and of all other accounts managed by it for execution with many broker-dealer firms. Eaton Vance uses its best efforts to obtain execution of portfolio security transactions at prices which are advantageous to the Registrant and (when a disclosed commission is being charged) at reasonably competitive commission rates. In seeking such execution, Eaton Vance will use its best judgment in evaluating the terms of a transaction, and will give consideration to various relevant factors, including without limitation the size and type of the transaction, the general execution and operational capabilities of the broker-dealer, the nature and character of the market for the security, the confidentiality, speed and certainty of effective execution required for the transaction, the reputation, reliability, experience and financial condition of the broker-dealer, the value and quality of services rendered by the broker- dealer in other transactions, and the reasonableness of the commission, if any. Transactions on United States stock exchanges and other agency transactions involve the payment by the Registrant of negotiated brokerage commissions. Such commissions vary among different broker-dealer firms, and a particular broker-dealer may charge different commissions according to such factors as the difficulty and size of the transaction and the volume of business done with such broker-dealer. Transactions in foreign securities usually involve the payment of fixed brokerage commissions, which are generally higher than those in the United States. There is generally no stated commission in the case of securities traded in the over-the-counter markets, but the price paid or received by the Registrant usually includes an undisclosed dealer markup or markdown. In an underwritten offering the price paid by the Registrant includes a disclosed fixed commission or discount retained by the underwriter or dealer. Item 17. Continued Although commissions paid on portfolio security transactions will, in the judgment of Eaton Vance, be reasonable in relation to the value of the services provided, commissions exceeding those which another firm might charge may be paid to broker-dealers who were selected to execute transactions on behalf of the Registrant and Eaton Vance's other clients for providing brokerage and research services to Eaton Vance. As authorized in Section 28(e) of the Securities Exchange Act of 1934, a broker or dealer who executes a portfolio transaction on behalf of the Fund may receive a commission which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if Eaton Vance determines in good faith that such commission was reasonable in relation to the value of the brokerage and research services which have been provided. This determination may be made on the basis of either that particular transaction or on the basis of the overall responsibilities which Eaton Vance and its affiliates have for accounts over which they exercise investment discretion. In making any such determination, Eaton Vance will not attempt to place a specific dollar value on the brokerage and research services provided or to determine what portion of the commission should be related to such services. Brokerage and research services may include advice as to the value of securities, the advisability of investing in, purchasing, or selling securities, and the availability of securities or purchasers or sellers of securities; furnishing analyses and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy and the performance of accounts and effecting securities transactions and performing functions incidental thereto (such as clearance and settlement); and the "Research Services" referred to in the next paragraph. It is a common practice in the investment advisory industry for the advisers of investment companies, institutions and other investors to receive research, statistical and quotation services, data, information and other services, products and materials which assist such advisers in the performance of their investment responsibilities ("Research Services") from broker-dealer firms which execute portfolio transactions for the clients of such advisers from third parties with which such broker-dealers have arrangements. Consistent with this practice, Eaton Vance receives Research Services from many broker-dealer firms with which Eaton Vance places the Registrant's portfolio transactions and from third parties with which these broker-dealers have arrangements. These Research Services include such matters as general economic and market reviews, industry and company reviews, evaluations of securities and portfolio strategies and transactions and recommendations as to the purchase and sale of securities and other portfolio transactions, financial, industry and trade publications, news and information services, pricing and quotation equipment and services, and research oriented computer hardware, software, data bases and services. Any such Research Service may be broadly useful and of value to Eaton Vance in rendering investment advisory services to all or a significant portion of its clients, or may be relevant and useful for the management of only one client's account or of a few clients' accounts, or may be useful for the management of merely a segment of certain clients' accounts, regardless of whether any such account or accounts paid commissions to the broker-dealer through which such Research Service was obtained. The advisory fee paid by the Registrant is not reduced because Eaton Vance receives such Research Services. Eaton Vance evaluates the nature and quality of the various Research Services obtained through broker-dealer firms and attempts to allocate sufficient commissions to such firms to ensure the continued receipt of Research Services which Eaton Vance believes are useful or of value to it in rendering investment advisory services to its clients. Item 17. Continued Securities considered as investments for the Registrant may also be appropriate for other investment accounts managed by Eaton Vance or its affiliates. Eaton Vance will attempt to allocate equitably portfolio security transactions among the Registrant and the portfolios of its other investment accounts whenever decisions are made to purchase or sell securities by the Registrant and one or more of such other accounts simultaneously. In making such allocations, the main factors to be considered are the respective investment objectives of the Registrant and such other accounts, the relative size of portfolio holdings of the same or comparable securities, the availability of cash for investment by the Registrant and such accounts, the size of investment commitments generally held by the Registrant and such accounts and the opinions of the persons responsible for recommending investments to the Registrant and such accounts. While this procedure could have a detrimental effect on the price or amount of the securities available to the Registrant from time to time, it is the opinion of the Directors that the benefits available from the Eaton Vance organization outweigh any disadvantage that may arise from exposure to simultaneous transactions. During the Registrant's fiscal years ended October 31, 1994, 1993 and 1992, the Registrant paid brokerage commissions of $5,058, $4,102 and $300, respectively, on portfolio security transactions. Of the total brokerage commission of $5,058, $4,102, and $300, respectively, paid during the fiscal years ended October 31, 1994, 1993, and 1992, approximately $3,857, $4,102 and $300, respectively, was paid in respect of portfolio security transactions aggregating approximately $2,259,497, $2,814,711 and $235,000, respectively, to firms which provided some research services to Eaton Vance (although many of such firms may have been selected in any particular transaction primarily because of their execution capabilities). Item 18. Capital Stock and Other Securities (a) No change from the information set forth in Item 18(a) of Form N-1A, filed as Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herein by reference. (b) Not applicable Item 19. Purchase, Redemption and Pricing of Securities Being Offered (a) No change from the information set forth in Item 19(a) of Form N-1A, filed as Amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herein by reference. (b) The net asset value of each share of the Registrant outstanding is determined by the Board of Directors or its delegate not less frequently than once on each business day (which term means each day on which the net asset value of shares of the Registrant is required to be computed by the provisions of the 1940 Act or rules or regulations promulgated thereunder) and the net asset value as so determined shall become effective at such time as the Board of Directors or its delegate may determine. The Board of Directors may delegate any of its powers and duties with respect to the determination of net asset value and appraisal of assets and liabilities. Currently the net asset value is determined once each business day by IBT, as agent for the Registrant, as of the close of the Exchange. The Board of Directors or its delegate may cause the net asset value per share last determined to be determined again, and may determine the time when such redetermined net asset value may become effective. Any such redetermination may be made by appraisal, or by estimate based upon changes in Item 19. Continued the market value of representative or selected securities or in recognized market averages or in other standard market data since the last determination. The Board of Directors may declare a suspension of the determination of net asset value for the whole or any part of any period with respect to which an open-end investment company may declare such a suspension not inconsistent with the provisions of the 1940 Act or rules or regulations promulgated thereunder. Such suspension shall take effect at such time as the Board of Directors shall specify but not later than the close of business on the business day next following the declaration, and thereafter there shall be no determination of net asset value until the Board of Directors shall declare the suspension at an end, except that the suspension shall terminate in any event when the conditions precedent prescribed by the 1940 Act or rules or regulations promulgated thereunder to the declaration of such a suspension shall have terminated. The net asset value of each share of the Registrant as of any particular time shall be the quotient (adjusted to the nearer cent) obtained by dividing the value, as of such time, of the net assets of the Registrant (i.e. the value of the assets of the Registrant less its actual and accrued liability exclusive of capital and surplus) by the total number of shares outstanding (exclusive of treasury shares) at such time, all as determined by the Board of Directors or its delegate. In appraising the liabilities of the Corporation the Board of Directors or its delegate may include in liabilities such reserves for taxes, estimated expenses and contingencies as the Board or its delegate deems fair and reasonable under the circumstances. All securities for which market quotations are readily available shall be appraised at their market value and all other securities and assets shall be appraised at their fair value, in each case pursuant to methods or procedures authorized or approved by the Board of Directors or any duly authorized committee thereof. All determinations of net asset value and appraisals of assets and liabilities made in good faith by the Board of Directors or its delegate shall be binding and conclusive upon all stockholders and other persons interested. The Registrant may issue shares at net asset value in connection with any merger or consolidation with, or acquisition of the assets of, any investment company or personal holding company, subject to the requirements of the 1940 Act. The information set forth under Item 8 hereof is incorporated herein by reference. (c) and (d) Not applicable Item 20. Tax Status Under the provisions of Subchapter M of the Internal Revenue Code, an investment company, such as the Registrant, which distributes to its shareholders for any year substantially all of its net investment income pays no federal income or excise taxes on such income as to that year. The Registrant met the requirements of Subchapter M for the taxable year ended October 31, 1994 and intends to meet such requirement for the taxable year ending October 31, 1995. Dividends from net investment income are paid at least quarterly. These dividends are paid in shares of the Registrant computed at net asset value, subject to an option to each shareholder to elect to be paid in cash. Such dividends from net investment income are taxable to the shareholders at Item 20. Continued ordinary income rates for federal income tax purposes. Net realized long-term capital gains are normally retained by the Registrant, and the Registrant pays the federal tax thereon on behalf of shareholders. When this is done the shareholder includes in his personal income tax return his proportionate share of such gains, takes a credit for the payment of taxes thereon, and increases the tax cost basis of his shares by an amount equal to such gains less the taxes paid. Due to regulations imposed by the Internal Revenue Service the Registrant is required to distribute net realized long-term capital gains (computed on the basis of the one-year period ending on October 31 of such year) and 100% of any income from the present year that was not paid out during such year and on which the Fund was not taxed. The Registrant therefore reserves the right to distribute such capital gains when required. The Registrant currently plans to continue to pay dividends at least quarterly from its net investment income and retain realized net long-term capital gains as outlined above. However, Registrant reserves the right, in its discretion, to distribute such capital gains in shares of the Registrant at net asset value, or at the option of each shareholder, in cash. Item 21. Underwriters Not applicable, inasmuch as Registrant does not make a continuous offering of its shares. Item 22. Calculation of Performance Data Not applicable Item 23. Financial Statements CAPITAL EXCHANGE FUND, INC. OCTOBER 31, 1994 (UNAUDITED) INVESTMENT CHANGES -- SIX MONTHS ENDED OCTOBER 31, 1994 - --------------------------------------------------------------------------- SHARES OWNED DECREASES APR 30 OCT 31 - --------------------------------------------------------------------------- Albertson's, Inc. 192,048 180,328 - --------------------------------------------------------------------------- Bristol-Myers Squibb Co. 48,430 32,590 - --------------------------------------------------------------------------- Dexter Corp. 73,549 64,019 - --------------------------------------------------------------------------- Dun & Bradstreet Corp. 38,878 31,968 - --------------------------------------------------------------------------- Johnson & Johnson 82,260 81,150 - --------------------------------------------------------------------------- Reuters Holdings PLC, ADR 65,000 58,420 OTHER CHANGES SHARES - --------------------------------------------------------------------------- Lehman Brothers Holding Inc. in a 1 per 5 spinoff from American Express Co. 11,359 - --------------------------------------------------------------------------- Includes investments paid-in kind on redemptions. CAPITAL EXCHANGE FUND, INC. PORTFOLIO OF INVESTMENTS OCTOBER 31, 1994 - -------------------------------------------------------------------------- COMMON STOCKS - 98.9% - -------------------------------------------------------------------------- NAME OF COMPANY SHARES VALUE - -------------------------------------------------------------------------- ADVERTISING - 2.4% Interpublic Group Cos. 66,000 $ 2,178,000 ----------- AEROSPACE - 1.9% Boeing Co. 39,450 $ 1,730,869 ----------- AIR TRANSPORTATION - 0.5% Flightsafety International, Inc. 12,000 $ 484,500 ----------- BUSINESS PRODUCTS AND SERVICES - 8.4% Lotus Development Corp. 45,000 $ 1,721,250 Manpower Inc. 110,000 3,203,750 Reuters Holdings PLC, ADR 58,420 2,753,043 ----------- $ 7,678,043 ----------- CONSTRUCTION AND REAL ESTATE - 3.1% Dover Corp. 50,790 $ 2,818,845 ----------- CONSUMER PRODUCTS - 5.3% Anheuser-Busch Cos., Inc. 35,820 $ 1,817,865 Procter & Gamble Co. 48,000 3,000,000 ----------- $ 4,817,865 ----------- COSMETICS AND TOILETRIES - 4.2% International Flavors & Fragrances, Inc. 88,101 $ 3,865,431 ----------- DRUGS & MEDICAL - 13.4% Bristol-Myers Squibb Co. 32,590 $ 1,902,441 Johnson & Johnson 81,150 4,432,819 Merck & Co., Inc. 56,385 2,015,764 Pfizer Inc. 36,476 2,703,783 SmithKline Beecham PLC 37,520 1,144,360 ----------- $12,199,167 ----------- ELECTRONICS - 16.8% AMP Inc. 45,000 $ 3,403,125 Hewlett-Packard Co. 42,990 4,202,272 Intel Corp. 55,124 3,424,578 Raytheon Co. 40,000 2,550,000 Texas Instruments Inc. 24,000 1,797,000 ----------- $15,376,975 ----------- - -------------------------------------------------------------------------- COMMON STOCKS (Continued) - -------------------------------------------------------------------------- NAME OF COMPANY SHARES VALUE - -------------------------------------------------------------------------- FINANCIAL SERVICES - 4.1% American Express Co. 56,798 $ 1,746,539 Lehman Brothers Holdings Inc. 11,359 176,065 Marsh & McLennan Cos., Inc. 24,000 1,800,000 ----------- $ 3,722,604 ----------- FOOD PROCESSING - 1.5% McCormick & Co., Inc., Nonvoting 68,400 $ 1,350,900 ----------- FOREST PRODUCTS - 3.2% Kimberly-Clark Corp. 57,310 $ 2,951,465 ----------- INSTRUMENTATION AND CONTROLS - 2.0% Dionex Corp. 50,000 $ 1,850,000 ----------- INSURANCE - 3.5% American International Group Inc. 33,750 $ 3,159,844 ----------- MACHINERY AND EQUIPMENT - 6.1% Dexter Corp. 64,019 $ 1,320,392 Goulds Pumps, Inc. 78,830 1,724,406 Tecumseh Products Co. Class B 13,320 626,040 Tecumseh Products Co. Class A 39,960 1,938,060 ----------- $ 5,608,898 ----------- PETROLEUM - 3.8% Atlantic Richfield Co. 6,880 $ 745,620 Exxon Corp. 43,776 2,752,416 ----------- $ 3,498,036 ----------- PETROLEUM SERVICES AND EQUIPMENT - 2.8% Schlumberger Ltd. 42,819 $ 2,515,616 ----------- PHOTOGRAPHIC PRODUCTS - 2.0% Eastman Kodak Co. 37,181 $ 1,789,336 ----------- PUBLISHING AND PRINTING - 4.1% Dun & Bradstreet Corp. 31,968 $ 1,874,124 Harcourt General, Inc. 50,000 1,850,000 ----------- $ 3,724,124 ----------- - -------------------------------------------------------------------------- COMMON STOCKS (Continued) - -------------------------------------------------------------------------- NAME OF COMPANY SHARES VALUE - -------------------------------------------------------------------------- RETAIL - 9.8% Albertson's, Inc. 180,328 $ 5,409,840 Wal-Mart Stores, Inc. 148,700 3,494,450 ----------- $ 8,904,290 ----------- TOTAL COMMON STOCKS (IDENTIFIED COST,$16,369,226) $90,224,808 ----------- - -------------------------------------------------------------------------- FACE AMOUNT (000 OMITTED) - -------------------------------------------------------------------------- SHORT-TERM OBLIGATIONS - 1.0% - -------------------------------------------------------------------------- Ford Motor Credit Corp., 4.72% due 11/01/94 $900 $ 900,000 Salomon Brothers Inc. Repurchase Agreement, dated 10/31/94 due 11/01/94 to pay $52,080 52,080 ----------- TOTAL SHORT-TERM OBLIGATIONS, AT AMORTIZED COST $ 952,080 ----------- TOTAL INVESTMENTS (IDENTIFIED COST, $17,321,306) -99.9% $91,176,888 Other Assets, less Liabilities -0.1% 112,176 ----------- NET ASSETS - 100% $91,289,064 ----------- ----------- Non-income producing security. The repurchase agreement is fully collateralized by U.S.Treasury Notes, 11.25%, 2/15/15 See notes to financial statements FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES - ------------------------------------------------------------------------------ October 31, 1994 - ------------------------------------------------------------------------------ ASSETS: Investments, at value (Note 1A) (identified cost, $17,321,306) $91,176,888 Cash 881 Receivable for investments sold 243,661 Dividends receivable 120,157 ----------- Total assets $91,541,587 LIABILITIES: Payable for capital stock redeemed $244,838 Payable to affiliates -- Custodian fee 2,362 Directors' fees 512 Accrued expenses 4,811 -------- Total liabilities 252,523 ----------- NET ASSETS for 516,910 shares of capital stock outstanding $91,289,064 ----------- ----------- SOURCES OF NET ASSETS: Accumulated net realized gain on investment transactions (computed on the basis of identified cost), less the excess of cost of capital stock redeemed over proceeds from sales of capital stock (including shares issued to shareholders electing to receive payment of distributions in capital stock) $25,709,294 Unrealized appreciation of investments (computed on the basis of identified cost) 73,855,582 Provision for federal tax on undistributed net realized long-term capital gain (8,324,465) Undistributed net investment income 48,653 ----------- Total $91,289,064 ----------- ----------- NET ASSET VALUE AND REDEMPTION PRICE PER SHARE ($91,289,064 / 516,910 shares of capital stock outstanding) $176.61 ------ ------ See notes to financial statements STATEMENT OF OPERATIONS - ------------------------------------------------------------------------------ Year Ended October 31, 1994 - ------------------------------------------------------------------------------ INVESTMENT INCOME: Income -- Dividends $1,978,690 Interest 36,685 ---------- Total income $2,015,375 Expenses -- Investment adviser fee (Note 4) $ 559,424 Compensation of Directors not members of the Investment Adviser's organization 6,174 Custodian fees (Note 4) 49,061 Legal and accounting services 25,496 Printing and postage 20,636 Transfer and dividend disbursing agent fees 15,625 Miscellaneous 5,118 ---------- Total expenses 681,534 ---------- Net investment income $1,333,841 REALIZED AND UNREALIZED GAIN ON INVESTMENTS: Net realized gain on investments, computed on the basis of identified cost ($12,231 net gain as computed for federal income tax purposes) $4,135,350 Increase in unrealized appreciation of investments 2,100,381 ---------- Net realized and unrealized gain on investments 6,235,731 ---------- Net increase in net assets from operations $7,569,572 ---------- ---------- See notes to financial statements STATEMENT OF CHANGES IN NET ASSETS - ------------------------------------------------------------------------------ YEAR ENDED OCTOBER 31, ------------------------- 1994 1993 ----------- ----------- INCREASE (DECREASE) IN NET ASSETS: From operations -- Net investment income $ 1,333,841 $ 1,295,606 Net realized gain on investments 4,135,350 4,414,401 Increase in unrealized appreciation of investments 2,100,381 880,587 ----------- ----------- Increase in net assets from operations $ 7,569,572 $ 6,590,594 Undistributed net investment income included in net asset value of shares redeemed and issued -- (5,468) Distributions to shareholders -- From net investment income (1,319,653) (1,414,378) From net realized gain on investments (81,369) -- Provision for federal tax on undistributed net realized long-term gain (Note 1B) -- (264,828) Net decrease from capital stock transactions (exclusive of amounts allocated to net investment income) (4,472,337) (3,944,681) ----------- ----------- Net increase in net assets $ 1,696,213 $ 961,239 NET ASSETS: At beginning of year 89,592,851 88,631,612 ----------- ----------- At end of year (including undistributed net investment income of $48,653 and $34,465, respectively) $91,289,064 $89,592,851 ----------- ----------- ----------- ----------- See notes to financial statements FINANCIAL HIGHLIGHTS - ------------------------------------------------------------------------------ YEAR ENDED OCTOBER 31, ------------------------------------------------------- 1994 1993 1992 1991 1990 -------- -------- -------- -------- -------- NET ASSET VALUE, beginning of year $164.860 $156.030 $142.810 $106.030 $112.910 -------- -------- -------- -------- -------- INCOME FROM OPERATIONS: Net investment income $ 2.521 $ 2.334 $ 2.178 $ 2.181 $ 2.339 Net realized and unrealized gain (loss) on investments 11.869 9.533 13.332 36.949 (6.769) -------- -------- -------- -------- -------- Total income (loss) from operations $ 14.390 $ 11.867 $ 15.510 $ 39.130 $ (4.430) -------- -------- -------- -------- -------- LESS DISTRIBUTIONS: From net investment income $ (2.490) $ (2.550) $ (2.130) $ (2.350) $ (2.450) From net realized gain on investments (0.150) -- (0.160) -- -- -------- -------- -------- -------- -------- Total distributions $ (2.640) $ (2.550) $ (2.290) $ (2.350) $ (2.450) -------- -------- -------- -------- -------- Provision for federal tax on undistributed net realized long-term gain (Note 1B) $ -- $ (0.487) $ -- $ -- $ -- -------- -------- -------- -------- -------- NET ASSET VALUE, end of year $176.610 $164.860 $156.030 $142.810 $106.030 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- TOTAL RETURN 8.80% 7.33% 10.94% 37.13% (4.05)% RATIOS/SUPPLEMENTAL DATA: Net assets, end of year (000's omitted) $ 91,289 $ 89,593 $ 88,632 $ 86,148 $ 66,528 Ratio of expenses to average net assets 0.76% 0.78% 0.78% 0.79% 0.86% Ratio of net investment income to average net assets 1.49% 1.46% 1.44% 1.64% 2.05% PORTFOLIO TURNOVER 2% 2% 0% 3% 4% See notes to financial statements (1) SIGNIFICANT ACCOUNTING POLICIES The Fund is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end, management investment company. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The policies are in conformity with generally accepted accounting principles. A. INVESTMENT VALUATIONS -- Investments listed on securities exchanges or in the NASDAQ National Market are valued at closing sale prices. Listed or unlisted investments for which closing sale prices are not available are valued at closing bid prices. Short-term obligations, maturing in 60 days or less, are valued at amortized cost, which approximates value. B. FEDERAL TAXES -- The Fund's policy is to comply with the provisions of the Internal Revenue Code available to regulated investment companies and to distribute to shareholders each year all of its taxable income from dividends, interest and net realized short-term capital gain. Accordingly, no provision for federal income or excise tax is necessary on such income. The Fund generally designates as undistributed any taxable net realized long-term gain (but reserves the right to distribute such gain in any year) and pays the federal tax thereon on behalf of shareholders. Provision for such tax is recorded on the Fund's records on the last business day of the Fund's fiscal year because the Internal Revenue Code provides that such tax is allocated among shareholders of record on that date. C. EQUALIZATION -- Prior to November 1, 1993, the Fund followed the accounting practice known as equalization by which a portion of the proceeds from the sales and costs of redemptions of Fund shares was allocated to undistributed net investment income. As of November 1, 1993, the Fund discontinued the use of equalization. This change had no effect on the Fund's net assets, net asset value per share, or its net increase in net assets from operations. Discontinuing the use of equalization will result in a simpler and more meaningful financial statement presentation. D. OTHER -- Investment transactions are accounted for on a trade date basis. Dividend income and dividends to shareholders are recorded on the ex-dividend date. E. DISTRIBUTIONS -- Generally accepted accounting principles require that differences in the recognition or classification of income between the financial statements and tax earnings and profits which result in temporary over-distributions for financial statement purposes, are classified as distributions in excess of net investment income or accumulated net realized gains. - ------------------------------------------------------------------------------ (2) CAPITAL STOCK At October 31, 1994, there were 4,000,000 shares of $1.00 par value capital stock authorized. Transactions in capital stock were as follows: YEAR ENDED OCTOBER 31, ----------------------------------------------- 1994 1993 ----------------------- ---------------------- SHARES AMOUNT SHARES AMOUNT ------ ------ ------ ------ Redemptions (28,431) $(4,795,769) (26,131) $(4,190,319) Issued to shareholders electing to receive payment of dividends in capital stock 1,907 323,432 1,517 245,638 ------- ----------- ------- ----------- Net decrease (26,524) $(4,472,337) (24,614) $(3,944,681) ------- ----------- ------- ----------- ------- ----------- ------- ----------- - ------------------------------------------------------------------------------ (3) INVESTMENT TRANSACTIONS Purchases and sales of investments, other than short-term obligations, aggregated $1,651,790 and $1,412,947, respectively. In addition, investments having an aggregate market value of $4,535,961 at dates of redemption were distributed in payment for capital stock redeemed. - ------------------------------------------------------------------------------ (4) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES The investment adviser fee, computed at the monthly rate of 5/96 of 1% ( 5/8 of 1% annually) of the Fund's average monthly net assets, was paid to Eaton Vance Management (EVM) as compensation for management and investment advisory services rendered to the Fund. Except as to directors of the Fund who are not members of EVM's organization, officers and directors receive remuneration for their services to the Fund out of such investment adviser fee. The custodian fee was paid to Investors Bank & Trust Company (IBT), an affiliate of EVM, for its services as custodian of the Fund. Pursuant to the custodian agreement, IBT receives a fee reduced by credits which are determined based on the average daily cash balances the Fund maintains with IBT. Certain of the officers and directors of the Fund are officers and directors/trustees of the above organizations. - ------------------------------------------------------------------------------ (5) LINE OF CREDIT The Fund participates with other funds managed by EVM in a $120 million unsecured line of credit agreement with a bank. The line of credit consists of a $20 million committed facility and a $100 million discretionary facility. Borrowings will be made by the Fund solely to facilitate the handling of unusual and/or unanticipated short-term cash requirements. Interest is charged to each fund based on its borrowings at an amount above either the bank's adjusted certificate of deposit rate, a variable adjusted certificate of deposit rate, or a federal funds effective rate. In addition, a fee computed at an annual rate of 1/4 of 1% on the $20 million committed facility and on the daily unused portion of the $100 million discretionary facility is allocated among the participating funds at the end of each quarter. The Fund did not have any significant borrowings or allocated fees during the year. - ------------------------------------------------------------------------------ (6) FEDERAL INCOME TAX BASIS OF INVESTMENTS The cost and unrealized appreciation/depreciation in value of the investments owned at October 31, 1994, as computed on a federal income tax basis, are as follows: Aggregate cost $17,321,306 ----------- ----------- Gross unrealized appreciation $73,855,582 Gross unrealized depreciation -- ----------- Net unrealized appreciation $73,855,582 ----------- ----------- INDEPENDENT AUDITORS' REPORT - ------------------------------------------------------------------------------ To the Board of Directors and Shareholders of Capital Exchange Fund, Inc.: We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of Capital Exchange Fund, Inc. as of October 31, 1994, and the related statement of operations for the year then ended, the statement of changes in net assets for the years ended October 31, 1994 and 1993, and the financial highlights for each of the years in the five-year period ended October 31, 1994. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned at October 31, 1994, by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements and financial highlights present fairly, in all material respects, the financial position of Capital Exchange Fund, Inc. at October 31, 1994, the results of its operations, the changes in its net assets, and its financial highlights for the respective stated periods, in conformity with generally accepted accounting principles. DELOITTE & TOUCHE LLP Boston, Massachusetts December 1, 1994 PART C OTHER INFORMATION Item 24. Financial Statements and Exhibits (a) INCLUDED IN ITEM 23 OF THE REGISTRANT'S STATEMENT OF ADDITIONAL INFORMATION (Form N-1A, Part B): Portfolio of Investments, October 31, 1994 Statement of Assets and Liabilities, October 31, 1994 Statement of Operations For The Year Ended October 31, 1994 Statement of Changes In Net Assets For Each of The Two Years In The Period Ended October 31, 1994 Financial Highlights For Each of The Five Years In the Period Ended October 31, 1994 (b) Exhibits: (1) Articles of Organization Filed as Exhibit No. 1.1 to Post- incorporating all Effective Amendment No. 7 to amendements to date Registration Statement on and currently in Form N-1, File No. 811-1339 and effect incorporated herein by reference. (2) By-Laws incorporating all Filed as Exhibit No. 2 to Post- amendments to date and Effective Amendment No. 7 to currently in effect Registration Statement on Form N-1, File No. 811-1339 and incorporated herein by reference. (3) Not Applicable (4) Specimen of each security Filed as Exhibit No. 4a to issued by the Registrant Post-Effective Amendment No. 6 to Registration Statement on Form N-1, File No. 811-1339 and incorporated herein by reference. Item 24. (b) Continued (5) Investment Advisory Filed as Exhibit No. 5 Agreement with Eaton Vance to Post-Effective Amendment Management dated No. 14 to Registration Statement November 1, 1990 on Form N-1A, File No. 811-1339 and incorporated herein by reference. (6) Not Applicable (7) Not Applicable (8) Custodian Agreement dated Filed as Exhibit No. 8 to December 17, 1990 Post-Effective Amendment No. 15 to Registration Statement on Form N-1A, File No. 811-1339 and incorporated herein by reference. (9) Not Applicable (10) Legal Opinion of Gaston, Filed as Exhibit No. 9B to Snow, Motley & Holt, dated Amendment No. 4 to February 14, 1966 Registration Statement on Form S-5, File No. 2-24149 and and incorporated herein by reference. (11) Auditors' Consent Attached as Exhibit No. 11 (12) Not Applicable (13) Not Applicable (14) Not Applicable (15) Not Applicable (16) Not Applicable Item 25. Persons Controlled by or under Common Control with Registrant Not Applicable Item 26. Number of Holders of Securities (1) (2) Number of Record Title of Class Holders Capital Stock 333 $1.00 par value as of January 31, 1995 Item 27. Indemnification No change from the information set forth in Item 27 of Form N-1A, filed as Post-Effective amendment No. 8 to the Registration Statement under the 1940 Act, File No. 811-1339, which information is incorporated herewith by reference. Item 28. Business and Other Connections of Investment Adviser In addition to Eaton Vance acting as investment adviser to the Fund, Eaton Vance or BMR also act as investment adviser under other agreements for the following investment companies and also various individual and institutional clients, with combined assets under management of approximately $15 billion. Such investment companies are: Alabama Tax Free Portfolio Arizona Tax Free Portfolio Arkansas Tax Free Portfolio California Limited Maturity Tax Free Portfolio California Tax Free Portfolio Capital Exchange Fund, Inc. Cash Management Portfolio Colorado Tax Free Portfolio Connecticut Limited Maturity Tax Free Portfolio Connecticut Tax Free Portfolio Depositors Fund of Boston, Inc. Diversification Fund, Inc. EV Marathon Gold & Natural Resources Fund Eaton Vance Equity-Income Trust Eaton Vance Income Fund of Boston Eaton Vance Municipal Bond Fund L.P. Eaton Vance Prime Rate Reserves Eaton Vance Short-Term Treasury Fund Eaton Vance Tax Free Reserves Emerging Markets Portfolio Florida Insured Tax Free Portfolio Fiduciary Exchange Fund, Inc. Florida Limited Maturity Tax Free Portfolio Florida Tax Free Portfolio Georgia Tax Free Portfolio Government Obligations Portfolio Greater China Growth Portfolio Growth Portfolio Hawaii Tax Free Portfolio High Income Portfolio Investors Portfolio Kansas Tax Free Portfolio Kentucky Tax Free Portfolio Louisiana Tax Free Portfolio Maryland Tax Free Portfolio Massachusetts Limited Maturity Tax Free Portfolio Massachusetts Tax Free Portfolio Michigan Limited Maturity Tax Free Portfolio Michigan Tax Free Portfolio Minnesota Tax Free Portfolio Missouri Tax Free Portfolio Mississippi Tax Free Portfolio National Limited Maturity Tax Free Portfolio National Municipals Portfolio New Jersey Limited Maturity Tax Free Portfolio New Jersey Tax Free Portfolio New York Limited Maturity Tax Free Portfolio New York Tax Free Portfolio Item 28. Continued North Carolina Tax Free Portfolio Ohio Limited Maturity Tax Free Portfolio Ohio Tax Free Portfolio Oregon Tax Free Portfolio Pennsylvania Limited Maturity Tax Free Portfolio Pennsylvania Tax Free Portfolio Rhode Island Tax Free Portfolio Second Fiduciary Exchange Fund, Inc. Short-Term Income Portfolio South Asia Portfolio South Carolina Tax Free Portfolio Special Investment Portfolio Stock Portfolio Tennessee Tax Free Portfolio Texas Tax Free Portfolio Total Return Portfolio The Exchange Fund of Boston, Inc. Vance, Sanders Exchange Fund (A California Limited Partnership) Virginia Tax Free Portfolio West Virginia Tax Free Portfolio Eaton Vance owns all of the stock of Eaton Vance Distributors, Inc., which acts as principal underwriter for: EV Classic Alabama Tax Free Fund EV Classic Arizona Tax Free Fund EV Classic Arkansas Tax Free Fund EV Classic California Limited Maturity Tax Free Fund EV Classic California Municipals Fund EV Classic Colorado Tax Free Fund EV Classic Connecticut Limited Maturity Tax Free Fund EV Classic Connecticut Tax Free Fund EV Classic Florida Insured Tax Free Fund EV Classic Florida Limited Maturity Tax Free Fund EV Classic Florida Tax Free Fund EV Classic Georgia Tax Free Fund EV Classic Government Obligations Fund EV Classic Greater China Growth Fund EV Classic Growth Fund EV Classic Hawaii Tax Free Fund EV Classic High Income Fund EV Classic Investors Fund EV Classic Kansas Tax Free Fund EV Classic Kentucky Tax Free Fund EV Classic Louisiana Tax Free Fund EV Classic Maryland Tax Free Fund EV Classic Massachusetts Limited Maturity Tax Free Fund EV Classic Massachusetts Tax Free Fund EV Classic Michigan Limited Maturity Tax Free Fund EV Classic Michigan Tax Free Fund EV Classic Minnesota Tax Free Fund EV Classic Mississippi Tax Free Fund EV Classic Missouri Tax Free Fund EV Classic National Limited Maturity Tax Free Fund EV Classic National Municipals Fund EV Classic New Jersey Limited Tax Free Fund EV Classic New Jersey Tax Free Fund EV Classic New York Limited Maturity Tax Free Fund EV Classic New York Tax Free Fund EV Classic North Carolina Tax Free Fund EV Classic Ohio Limited Maturity Tax Free Fund Item 28. Continued EV Classic Ohio Tax Free Fund EV Classic Oregon Tax Free Fund EV Classic Pennsylvania Limited Maturity Tax Free Fund EV Classic Pennsylvania Tax Free Fund EV Classic Rhode Island Tax Free Fund EV Classic Short-Term Strategic Income Fund EV Classic South Carolina Tax Free Fund EV Classic Special Equities Fund EV Classic Stock Fund EV Classic Tennessee Tax Free Fund EV Classic Texas Tax Free Fund EV Classic Total Return Trust EV Classic Virginia Tax Free Fund EV Classic West Virginia Tax Free Fund EV Marathon Alabama Tax Free Fund EV Marathon Arizona Limited Maturity Tax Free Fund EV Marathon Arizona Tax Free Fund EV Marathon Arkansas Tax Free Fund EV Marathon California Limited Maturity Tax Free Fund EV Marathon California Municipals Fund EV Marathon Colorado Tax Free Fund EV Marathon Connecticut Tax Free Fund EV Marathon Emerging Markets Fund Eaton Vance Equity-Income Trust EV Marathon Florida Insured Tax Free Fund EV Marathon Florida Limited Maturity Tax Free Fund EV Marathon Florida Tax Free Fund EV Marathon Georgia Tax Free Fund EV Marathon Gold & Natural Resources Fund EV Marathon Government Obligations Fund EV Marathon Greater China Growth Fund EV Marathon Greater India Fund EV Marathon Growth Fund EV Marathon Hawaii Tax Free Fund EV Marathon High Income Fund EV Marathon Investors Fund EV Marathon Kansas Tax Free Fund EV Marathon Kentucky Tax Free Fund EV Marathon Louisiana Tax Free Fund EV Marathon Maryland Tax Free Fund EV Marathon Massachusetts Limited Maturity Tax Free EV Marathon Massachusetts Tax Free Fund EV Marathon Michigan Limited Maturity Tax Free Fund EV Marathon Michigan Tax Free Fund EV Marathon Minnesota Tax Free Fund EV Marathon Mississippi Tax Free Fund EV Marathon Missouri Tax Free Fund EV Marathon National Limited Maturity Tax Free Fund EV Marathon National Municipals Fund EV Marathon New Jersey Limited Maturity Tax Free Fund EV Marathon New Jersey Tax Free Fund EV Marathon New York Limited Maturity Tax Free Fund EV Marathon New York Tax Free Fund EV Marathon North Carolina Limited Maturity Tax Free Fund EV Marathon North Carolina Tax Free Fund EV Marathon Ohio Limited Maturity Tax Free Fund EV Marathon Ohio Tax Free Fund EV Marathon Oregon Tax Free Fund EV Marathon Pennsylvania Limited Maturity Tax Free Fund EV Marathon Pennsylvania Tax Free Fund EV Marathon Rhode Island Tax Free Fund Item 28. Continued EV Marathon Short-Term Strategic Income Fund EV Marathon South Carolina Tax Free Fund EV Marathon Special Equities Fund EV Marathon Stock Fund EV Marathon Tennessee Tax Free Fund EV Marathon Texas Tax Free Fund EV Marathon Total Return Fund EV Marathon Virginia Limited Maturity Tax Free Fund EV Marathon Virginia Tax Free Fund EV Marathon West Virginia Tax Free Fund EV Traditional California Municipals Fund EV Traditional Connecticut Tax Free Fund EV Traditional Emerging Markets Fund EV Traditional Florida Insured Tax Free Fund EV Traditional Florida Limited Maturity Tax Free Fund EV Traditional Florida Tax Free Fund EV Traditional Government Obligations Fund EV Traditional Greater China Growth Fund EV Traditional Greater India Fund EV Traditional Growth Fund Eaton Vance Income Fund of Boston EV Traditional Investors Fund Eaton Vance Municipal Bond Fund L.P. EV Traditional National Limited Maturity Tax Free Fund EV Traditional National Municipals Fund EV Traditional New Jersey Tax Free Fund EV Traditional New York Limited Maturity Tax Free Fund EV Traditional New York Tax Free Fund EV Traditional Pennsylvania Tax Free Fund EV Traditional Special Equities Fund EV Traditional Stock Fund EV Traditional Total Return Fund Eaton Vance Cash Management Fund Eaton Vance Liquid Assets Trust Eaton Vance Prime Rate Reserves Eaton Vance Short-Term Treasury Fund Eaton Vance Tax Free Reserves Massachusetts Municipal Bond Portfolio Eaton Vance owns all of the stock of Energex Corporation, which is engaged in oil and gas operations. EVC owns all of the stock of Marblehead Energy Corp. (which is engaged in oil and gas operations) and 77.3% of the stock of Investors Bank & Trust Company, ("IBT"), the Registrant's custodian, which also provides bookkeeping and pricing services to the Registrant. The charges for its services are offset by the value (determined by an agreed-upon formula) of the Registrant's cash balances, which are maintained with it as the Registrant's custodian. The Registrant also pays a fee based on the number and type of portfolio transactions. IBT also provides custodial, trustee and other fiduciary services to investors, including individuals, employee benefit plans, corporations, savings banks, investment companies and other institutions. In addition, Eaton Vance owns all the stock of Northeast Properties, Inc., which is engaged in real estate investment, consulting and management. EVC owns all of the stock of Fulcrum Management, Inc. and MinVen, Inc. which are engaged in the development of precious metal properties. EVC, Eaton Vance, BMR and EV may also enter into other businesses. Item 29. Principal Underwriters Inapplicable inasmuch as Registrant does not make a continuous offering of its shares. Item 30. Location of Accounts and Records All applicable accounts, books, and documents required to be maintained by Registrant by Section 31(a) of the Investment Company Act of 1940 and the Rules promulgated thereunder are in the possession and custody of the Registrant's custodian, Investors Bank & Trust Company, 24 Federal Street, Boston, Massachusetts 02110 and 89 South Street, Boston, MA 02ll0, and the Registrant's transfer agent, The Shareholder Services Group, Inc., 53 State Street, Boston, Massachusetts 02104 with the exception of certain corporate documents and portfolio trading documents as prescribed and listed in Rules 31a- 1(b), (4), (5), (6), (7), (9), (10), and (11) which are in the possession and custody of the Registrant's Treasurer at 24 Federal Street, Boston, Massachusetts 02110. Registrant is informed that all applicable accounts, books and documents required to be maintained by registered investment advisers are in the custody and possession of Registrant's investment adviser Eaton Vance, 24 Federal Street, Boston, Massachusetts 02110. Item 31. Management Services Not Applicable Item 32. Undertakings Not Applicable SIGNATURE Pursuant to the requirements of the Investment Company Act of 1940, the Registrant has duly caused this Amendment to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Boston and Commonwealth of Massachusetts, on the 22nd day of February 1995. CAPITAL EXCHANGE FUND, INC. By /s/James L. O'Connor James L. O'Connor, Treasurer EXHIBIT INDEX The following exhibits are filed as part of this Registration Statement or incorporated herein by reference pursuant to General Instruction E of Form N-1A. Page in Sequential Exhibit No. Description Numbering System 11 Auditors' Consent EX-99.11 2 AUDITORS CONSENT EX-99.11 INDEPENDENT AUDITORS' CONSENT We consent to the use in this Amendment No. 18 to Registration Statement (No. 811-1339 filed under the Investment Company Act of 1940) of Capital Exchange Fund, Inc. of our report, dated December 1, 1994, and to the reference to us under Item 16 in such Registration Statement. /s/Deloitte & Touche LLP Deloitte & Touche LLP February 22, 1995 EX-27 3 FIN DATA SCHED
6 0000017147 CAPITAL EXCHANGE FUND, INC. 1,000 12-MOS OCT-31-1994 OCT-31-1994 73,855 91,177 364 0 0 91,542 245 0 4 253 0 0 0 0 0 0 0 0 25,709 91,289 1,979 37 0 682 1,334 4,135 2,100 7,570 0 0 0 0 0 0 0 1,696 0 0 0 0 559 0 682 91,289 0 0 0 0 0 0 0 0.76 0 0
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