SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement. [ ] Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material under rule
14a-12
AEW Real Estate Income Fund
(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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AEW Real Estate Income Fund
399 Boylston Street
Boston, Massachusetts 02116
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
June 15, 2005
To the Shareholders of the AEW Real Estate Income Fund:
Notice is hereby given that the Annual Meeting of Shareholders (the
"Meeting") of the AEW Real Estate Income Fund (the "Fund") will be held at the
offices of IXIS Asset Management Advisors, L.P., located at 399 Boylston
Street, 10th Floor, Boston, Massachusetts 02116, on Wednesday, June 15, 2005 at
2 p.m., for the following purposes:
1. To elect four Trustees of the Fund, each to hold office for the term
indicated and until their successors shall have been elected and qualified;
and
2. To transact such other business as may properly come before the Meeting or
any adjournments or postponements thereof.
The Board of Trustees of the Fund has fixed the close of business on April
8, 2005 as the record date for the determination of shareholders entitled to
notice of, and to vote at, the Meeting or any postponement or adjournment
thereof. The enclosed proxy is being solicited on behalf of the Board of
Trustees of the Fund.
By order of the Board of Trustees,
Coleen Downs Dinneen,
Secretary
Boston, Massachusetts
April 26, 2005
It is important that your shares be represented at the Meeting in person or by
proxy, no matter how many shares you own. If you do not expect to attend the
Meeting, please complete, date, sign and return the applicable enclosed proxy
or proxies in the accompanying envelope, which requires no postage if mailed in
the United States. Please mark and mail your proxy or proxies promptly in order
to save the Fund any additional costs of further proxy solicitations and in
order for the Meeting to be held as scheduled.
AEW REAL ESTATE INCOME FUND
399 Boylston Street
Boston, Massachusetts 02116
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS
June 15, 2005
Introduction
This Proxy Statement is furnished in connection with the solicitation by the
Board of Trustees (the "Board") of AEW Real Estate Income Fund (the "Fund") of
a proxy to be voted at the Annual Meeting of Shareholders to be held on June
15, 2005, and any adjournment or postponement thereof (the "Meeting"). The
Meeting will be held at the offices of IXIS Asset Management Advisors, L.P.,
399 Boylston Street, 10th Floor, Boston, Massachusetts 02116, on Wednesday,
June 15, 2005 at 2 p.m.
The Meeting is scheduled as a meeting of the respective holders of common
shares (the "Common Shareholders") and preferred shares (the "Preferred
Shareholders" and, together with Common Shareholders, the "Shareholders") of
the Fund because the Shareholders of the Fund are expected to consider and vote
on similar matters.
The Notice of Annual Meeting of Shareholders (the "Notice"), this Proxy
Statement and the enclosed Proxy Card are first being sent to Shareholders on
or about April 26, 2005.
The Board of Trustees of the Fund has fixed the close of business on April
8, 2005 as the record date (the "Record Date") for the determination of
Shareholders of the Fund entitled to notice of, and to vote at, the Meeting,
and any postponement or adjournment thereof. Shareholders of the Fund on the
Record Date will be entitled to one vote for each share held, and a fractional
vote with respect to fractional shares, on each matter to which they are
entitled to vote and that is to be voted on, with no cumulative voting rights.
The following table sets forth the number of shares of common stock, $0.00001
par value per share ("Common Shares"), and shares of preferred stock, $0.00001
par value per share ("Preferred Shares" and, together with the Common Shares,
the "Shares"), of the Fund issued and outstanding at the close of business on
the Record Date:
Outstanding Common Shares Outstanding Preferred Shares
3,833,389.67 1,120
The classes of stock listed above are the only classes of stock currently
authorized by the Fund.
At the Meeting, Preferred Shareholders of the Fund will have equal voting
rights (i.e., one vote per Share) with the Fund's Common Shareholders and,
except as described below, will vote together with Common Shareholders as a
single class on the Proposal to be brought before the Meeting. Under the terms
of the Fund's Bylaws, as amended (the "Bylaws"), the holders of the Preferred
Shares are entitled as a class, to the exclusion of the holders of the Common
Shares, to elect two Trustees of the Fund (one such Trustee is identified in
the chart below). Simply stated, these Trustees are only elected by the holders
of the Fund's Preferred Shares. As summarized in the table below, (i) the
Common Shareholders and Preferred Shareholders, voting as a single class, have
the right to vote with respect to the election of Messrs. Charles D. Baker and
Ms. Cynthia L. Walker and the reelection of Mr. John A. Shane as Trustees, and
(ii) the Preferred Shareholders of the Fund, voting as a separate class, have
the right to vote on the reelection of Ms. Sandra O. Moose as a Trustee. The
Common Shareholders of the Fund do not have the right to vote with respect to
the reelection of Ms. Moose. The following table shows the candidates (the
"Nominees") each of whom has been nominated by the Trustees of the Fund who are
not "interested persons" (as defined in the Investment Company Act of 1940 (the
"1940 Act")) of the Fund.
1
Common Preferred
Proposal--Election of Trustees Shareholders Shareholders
------------------------------ ------------ ------------
Charles D. Baker........ X X
Sandra O. Moose*........ X
John A. Shane*.......... X X
Cynthia L. Walker....... X X
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* Ms. Moose and Mr. Shane currently are Trustees.
You may vote by mailing the enclosed proxy card. Shares represented by duly
executed and timely proxies will be voted as instructed on the proxy. If you
mail the enclosed proxy and no choice is indicated for the Proposal listed in
the attached Notice, your proxy will be voted in favor of the election of all
Nominees. At any time before it has been voted, your proxy may be revoked in
one of the following ways: (i) by sending a signed, written letter of
revocation to the Secretary of the Fund, (ii) by properly executing a
later-dated proxy or (iii) by attending the Meeting, requesting the return of
any previously delivered proxy and voting in person.
I. PROPOSAL: ELECTION OF TRUSTEES
In accordance with the Fund's Amended and Restated Agreement and Declaration
of Trust dated as of October 10, 2002 (the "Declaration"), the Trustees are
divided into the following three classes (each a "Class"): Class I, whose term
will expire at the conclusion of the Fund's 2006 annual meeting; Class II,
whose term will expire at the conclusion of the Fund's 2007 annual meeting; and
Class III, whose term will expire at the conclusion of this Meeting. At each
annual meeting, successors to the Class of Trustees whose term expires at that
annual meeting shall be elected for a three-year term. Accordingly,
shareholders will vote to elect Class III Trustees at the Meeting for an
approximate three-year term expiring at the 2008 annual meeting. A Trustee
elected at an annual meeting shall hold office until the conclusion of the
annual meeting for the year in which his or her term expires and until his or
her successor shall be elected and shall qualify, subject, however, to prior
death, resignation, retirement, disqualification or removal from office.
Under this classified Board structure, generally only those Trustees in a
single Class may be replaced at any one annual meeting, and it would require a
minimum of two annual meetings to change a majority of the Board under normal
circumstances. This structure, which may be regarded as an "anti-takeover"
provision, may make it more difficult for the Fund's Shareholders to change the
majority of Trustees of the Fund and, thus, promotes the continuity of current
management.
The Board, upon recommendation of its Contract Review and Governance
Committee, which makes nominations for Trustee membership, approved the
nomination of Mr. Baker, Ms. Moose, Mr. Shane and Ms. Walker for election at
the Meeting. If elected at the Meeting, they will be Class III Trustees.
All nominees named above (except Mr. Baker and Ms. Walker) are Trustees of
the Fund and have served in that capacity continuously since originally elected
or appointed in 2002.
Unless authority is withheld, it is the intention of the persons named in
the enclosed proxy to vote each proxy for the persons listed above. Each of the
Nominees has indicated he or she will serve if elected, but if he or she should
be unable to serve for the Fund, the proxy holders may vote in favor of such
substitute nominee as the Board may designate (or the Board may determine to
leave a vacancy). A Trustee elected by the Board to fill any vacancy occurring
in the Board of Trustees shall serve until the next annual meeting of
shareholders and until his or her successor shall be elected and shall qualify,
subject, however, to the Trustee's prior death, resignation, retirement,
disqualification or removal from office. Any Trustee elected by shareholders to
fill a vacancy that has arisen since the preceding annual meeting of
shareholders (whether or not any such vacancy has been filled by election of a
new Trustee by the Board) shall hold office for a term that coincides with the
remaining term of the Class of Trustees to which such office was previously
assigned, if such vacancy arose other than by an increase in the number of
Trustees, and until his or her successor shall be elected and shall qualify.
2
Information Regarding Trustees, Nominees and Officers
The following table provides information concerning the Trustees, the
Nominees for election as Trustees and the Officers of the Fund. Unless
otherwise indicated, the address of all persons below is 399 Boylston Street,
Boston, MA 02116.
Position(s) Held with the Number of Portfolios in
Fund, Length of Time Fund Complex
Served and Term of Principal Occupation(s) Overseen/(3)/ and Other
Name and Date of Birth Office/(1)/ During Past 5 Years/(2)/ Directorships Held
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Independent Trustees/(4)/
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Graham T. Allison Trustee, Contract Review Douglas Dillon Professor 37; Director, Taubman
(3/23/40) and Governance and Director for the Belfer Centers, Inc. (real estate
(Class I) Committee Member, since Center of Science and investment trust);
2002 International Affairs, John Advisory Board Member,
F. Kennedy School of USEC Inc. (energy
Government, Harvard supplier)
University
-------------------------------------------------------------------------------------------------------------
Charles D. Baker Nominee President and Chief 37; None
(11/13/56) Executive Officer,
(Class III) Harvard Pilgrim Health
Harvard Pilgrim Health Care Care (health plan)
93 Worcester Street
Wellesley, MA 02481
-------------------------------------------------------------------------------------------------------------
Edward A. Benjamin Trustee, Audit Committee Retired 37; Director, Coal, Energy
(5/30/38) Member, since 2003 Investments &
(Class II) Management, LLC;
Director, Precision Optics
Corporation (optics
manufacturer)
-------------------------------------------------------------------------------------------------------------
Daniel M. Cain* Trustee, Chairman of the President and Chief 37; Trustee, Universal
(2/24/45) Audit Committee, since Executive Officer, Cain Health Realty Income
(Class II) 2002; Co-Chairman of the Brothers & Company, Trust; Director, Sheridan
Board, since 2004 Incorporated (investment Healthcorp (physician
banking) practice management)
-------------------------------------------------------------------------------------------------------------
Paul G. Chenault Trustee, Contract Review Retired; Trustee, First 37; Director, Mailco
(9/12/33) and Governance Variable Life (variable life Office Products, Inc.
(Class I) Committee Member, since insurance) (mailing equipment)
2003
-------------------------------------------------------------------------------------------------------------
Kenneth J. Cowan Trustee, Chairman of the Retired 37; None
(4/5/32) Contract Review and
(Class II) Governance Committee,
since 2002; Co-Chairman
of the Board, since 2004
-------------------------------------------------------------------------------------------------------------
Richard Darman Trustee, Contract Review Partner, The Carlyle 37; Director and Chairman
(5/10/43) and Governance Group (investments); of the Board of Directors,
(Class I) Committee Member, since formerly, Professor, John AES Corporation
2002 F. Kennedy School of (independent power
Government, Harvard company)
University
-------------------------------------------------------------------------------------------------------------
Sandra O. Moose* Trustee and Nominee, President, Strategic 37; Director, Verizon
(2/17/42) Audit Committee Advisory Services Communications;
(Class III) Member, since 2002 (management consulting); Director, Rohm and Haas
formerly, Senior Vice Company (specialty
President and Director, chemicals); Director, AES
The Boston Consulting Corporation
Group, Inc. (management
consulting)
3
Position(s) Held with the Number of Portfolios in
Fund, Length of Time Fund Complex
Served and Term of Principal Occupation(s) Overseen/(3)/ and Other
Name and Date of Birth Office/(1)/ During Past 5 Years/(2)/ Directorships Held
------------------------------------------------------------------------------------------------------
John A. Shane Trustee and Nominee, President, Palmer Service 37; Director, Gensym
(2/22/33) Contract Review and Corporation (venture Corporation (software and
(Class III) Governance Committee capital organization) technology services
Member, since 2002 provider); Director, Abt
Associates Inc. (research
and consulting)
------------------------------------------------------------------------------------------------------
Cynthia L. Walker Nominee Dean for Finance & CFO 37; None
(7/25/56) (formerly, Associate Dean
(Class III) for Finance & CFO),
Harvard Medical School
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Interested Trustees
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Robert J. Blanding/(5)/ Trustee, since 2003 President, Chairman, 37; None
(4/17/47) Director and Chief
555 California Street Executive Officer,
San Francisco, CA 94104 Loomis, Sayles &
(Class I) Company, L.P.; President
and Chief Executive
Officer--Loomis Sayles
Funds I; Chief Executive
Officer--Loomis Sayles
Funds II
------------------------------------------------------------------------------------------------------
John T. Hailer/(6)/ President, Chief Executive President and Chief 37; None
(11/23/60) Officer and Trustee, since Executive Officer, IXIS
(Class II) 2002 Asset Management
Distributors, L.P.;
Executive Vice
President--Loomis Sayles
Funds I; President--
Loomis Sayles Funds II;
President and Chief
Executive Officer--CDC
Nvest Funds Trusts I, II
and III, CDC Nvest Cash
Management Trust and
CDC Nvest Companies
Trust I
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Officers
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Coleen Downs Dinneen Secretary, Clerk and Chief Senior Vice President, Not Applicable
(12/16/60) Legal Officer, since 2004 General Counsel,
Secretary and Clerk
(formerly, Deputy General
Counsel, Assistant
Secretary and Assistant
Clerk), IXIS Asset
Management Distribution
Corporation, IXIS Asset
Management Distributors,
L.P., IXIS Asset
Management Advisors,
L.P. and IXIS Asset
Management Services
Company; Chief
Compliance Officer, IXIS
Asset Management
Advisors, L.P.
4
Position(s) Held with the Number of Portfolios in
Fund, Length of Time Fund Complex
Served and Term of Principal Occupation(s) Overseen/(3)/ and Other
Name and Date of Birth Office/(1)/ During Past 5 Years/(2)/ Directorships Held
---------------------------------------------------------------------------------------------------
James J. Finnegan Executive Vice President, General Counsel, Not Applicable
(4/29/60) since 2004 Managing Director, Vice
Two Seaport Lane President and Clerk, AEW
Boston, MA 02110 Management and
Advisors, L.P.; General
Counsel and Vice
President, AEW Capital
Management, L.P.; Vice
President and Assistant
Clerk, AEW Investment
Group, Inc.; Vice
President and Assistant
Clerk, AEW Real Estate
Advisors, Inc.
---------------------------------------------------------------------------------------------------
Michael C. Kardok Treasurer, Principal Senior Vice President, Not Applicable
(7/17/59) Financial and Accounting IXIS Asset Management
Officer, since 2004 Advisors, L.P. and IXIS
Asset Management
Distributors, L.P.;
formerly, Senior Vice
President, IXIS Asset
Management Services
Company; formerly,
Senior Director, PFPC
Inc; formerly, Vice
President--Division
Manager, First Data
Investor Services, Inc.
---------------------------------------------------------------------------------------------------
Frank A. LoPiccolo Anti-Money Laundering President, Chief Executive Not Applicable
(4/1/53) Officer, since 2003 Officer and Director
(formerly, Executive Vice
President), IXIS Asset
Management Services
Company
---------------------------------------------------------------------------------------------------
John E. Pelletier Chief Operating Officer, Executive Vice President Not Applicable
(6/24/64) since 2004 and Chief Operating
Officer (formerly, General
Counsel, Secretary and
Clerk), IXIS Asset
Management Distributors,
L.P. and IXIS Asset
Management Advisors,
L.P.; Executive Vice
President (formerly,
Senior Vice President,
General Counsel,
Secretary and Clerk), IXIS
Asset Management
Distribution Corporation;
Director (formerly,
President, Chief Executive
Officer, General Counsel,
Secretary and Clerk), IXIS
Asset Management
Services Company
5
Position(s) Held with the Number of Portfolios in
Fund, Length of Time Fund Complex
Served and Term of Principal Occupation(s) Overseen/(3)/ and Other
Name and Date of Birth Office/(1)/ During Past 5 Years/(2)/ Directorships Held
--------------------------------------------------------------------------------------------------
Kristin Vigneaux Chief Compliance Officer, Chief Compliance Officer Not Applicable
(9/25/69) since 2004 for Mutual Funds, IXIS
Asset Management
Distributors, L.P., IXIS
Asset Management
Advisors, L.P. and IXIS
Asset Management
Services Company;
formerly, Vice President,
IXIS Asset Management
Services Company
/(1)/As described above, the Trustees are divided into three Classes and serve
staggered three-year terms, subject to their prior death, retirement,
resignation, disqualification or removal from the Board. It is currently
expected that, in accordance with the Board's current retirement policy,
Mr. Shane will retire as a Trustee prior to the 2008 Annual Meeting. The
current retirement age is 72. At a meeting held on November 19, 2004, the
Trustees voted to suspend the retirement policy until 2006. Officers hold
office at the pleasure of the Fund's Board and until their successors are
appointed and qualified or until their earlier resignation or removal.
/(2)/Previous positions during the past five years with IXIS Asset Management
Distributors, L.P. (the "Distributor"), IXIS Asset Management Advisors,
L.P. or Loomis, Sayles & Company, L.P. are omitted if not materially
different from a Trustee's or officer's current position with such entity.
As indicated, each Trustee is also a trustee of certain other investment
companies for which the Distributor acts as principal underwriter.
/(3)/The Trustees of the Fund serve as Trustees of a fund complex that includes
all series of CDC Nvest Funds Trust I, CDC Nvest Funds Trust II, CDC Nvest
Funds Trust III, CDC Nvest Cash Management Trust, CDC Nvest Companies
Trust I, AEW Real Estate Income Fund, Loomis Sayles Funds I and Loomis
Sayles Funds II. Effective May 1, 2005, certain Trusts will be changing
their names. CDC Nvest Funds Trust I will be changing its name to IXIS
Advisor Funds Trust I. CDC Nvest Funds Trust II will become IXIS Advisor
Funds Trust II. CDC Nvest Funds Trust III will become IXIS Advisor Funds
Trust III. CDC Nvest Companies Trust I will become IXIS Advisor Funds
Trust IV. CDC Nvest Cash Management Trust will become IXIS Advisor Cash
Management Trust.
/(4)/For purposes of this Proxy Statement, the term "Independent Trustees"
means those Trustees who are not "interested persons" (as defined in the
1940 Act) of the Fund, and the term "Interested Trustees" means those
Trustees who are "interested persons" of the Fund.
/(5)/Mr. Blanding is deemed an "interest person" of the Fund because he holds
the following positions with affiliated persons of the Fund: President,
Chairman, Director and Chief Executive Officer of Loomis, Sayles &
Company, L.P.
/(6)/Mr. Hailer is an "interested person" of the Fund because he holds the
following positions with affiliated persons of the Fund: Director and
Executive Vice President of IXIS Asset Management Distribution
Corporation; and President and Chief Executive Officer of IXIS Asset
Management Advisors, L.P.
* The holders of the Fund's Preferred Shares are entitled to elect two
Trustees. Mr. Cain and Ms. Moose are elected by the Preferred Shareholders.
The remaining Trustees are elected by holders of Common Shares and Preferred
Shares, voting together as a single class. As required by the 1940 Act,
Preferred Shareholders may under certain circumstances elect a majority of
the Board of Trustees.
6
The following table states the dollar range of equity securities
beneficially owned as of April 8, 2005 by each Trustee/Nominee of the Fund and,
on an aggregate basis, in any registered investment companies overseen or to be
overseen by the Trustee/Nominee in the Fund's "family of investment companies."
Aggregate Dollar Range of Equity Securities in All
Dollar Range of Equity Registered Investment Companies Overseen by
Name of Trustee or Nominee Securities in the Fund/(1)/ Trustee in Family of Investment Companies/(1),(2)/
-------------------------- -------------------------- --------------------------------------------------
Independent Trustees/Nominees
Graham T. Allison Jr......... A E
Charles D. Baker............. A A
Edward A. Benjamin........... A A
Daniel M. Cain............... A A
Paul G. Chenault............. A A
Kenneth J. Cowan............. A B
Richard Darman............... A A
Sandra O. Moose.............. A A
John A. Shane................ A E
Cynthia L. Walker............ A A
Interested Trustees
Robert J. Blanding........... A A
John T. Hailer............... A A
--------
/(1)/A. None
B. $1-$10,000
C. $10,001-$50,000
D. $50,001-$100,000
E. over $100,000
/(2)/Includes amounts held through the deferred compensation plan.
The Fund does not pay any compensation to its Officers or to its Interested
Trustees. Each Trustee, other than Interested Trustees, of the Fund receives a
fee of $2,000 annually for serving as a Trustee of the Fund, and a fee of $375
and related expenses for each meeting of the Board of Trustees attended. The
Co-Chairmen of the Board each receive an additional annual retainer fee of
$25,000 for serving as Co-Chairmen of the Board of Trustees of the Fund Complex
(as defined on the following page). Each member of a committee of the Board of
Trustees receives a fee of $2,000 annually for service on such committee, and
will also receive a meeting fee of $200 for each additional meeting after the
first four meetings of a committee during a given year. In addition, the
Chairperson of the Contract Review and Governance Committee and the Chairperson
of the Audit Committee receive an additional fee of $1,000 per year.
7
During the Fund's fiscal year ended January 31, 2005, the Trustees of the
Fund received the amounts set forth in the following table for serving as
Trustees of the Fund, CDC Nvest Funds Trust I, CDC Nvest Funds Trust II, CDC
Nvest Funds Trust III, CDC Nvest Companies Trust I, CDC Nvest Cash Management
Trust, Loomis Sayles Funds I and Loomis Sayles Funds II (collectively, the
"Fund Complex").
Aggregate Pension or
Compensation Retirement Estimated Total
from the Fund for Benefits Annual Compensation
the Fiscal Year Accrued as Benefits from the Fund
Ending Part of Fund upon Complex Paid to
Name of Trustee January 31, 2005 Expenses Retirement Trustees/(1),(2)/
--------------- ----------------- ------------ ---------- ----------------
Independent Trustees
Graham T. Allison, Jr. $6,450 $0 $0 $ 95,200
Edward A. Benjamin.... $6,650 $0 $0 $ 99,150
Daniel M. Cain........ $7,650 $0 $0 $115,185
Paul G. Chenault...... $6,450 $0 $0 $ 95,200
Kenneth J. Cowan...... $7,450 $0 $0 $111,235
Richard Darman........ $6,075 $0 $0 $ 90,325
Sandra O. Moose....... $6,650 $0 $0 $ 99,150
John A. Shane......... $6,450 $0 $0 $ 95,200
Interested Trustees
Robert J. Blanding.... $ 0 $0 $0 $ 0
John T. Hailer........ $ 0 $0 $0 $ 0
Peter S. Voss/(3)/.... $ 0 $0 $0 $ 0
--------
/(1)/The Fund does not provide pension or retirement benefits to its Trustees.
CDC Nvest Funds Trust I, CDC Nvest Funds Trust II, CDC Nvest Funds Trust
III, CDC Nvest Companies Trust I, CDC Nvest Cash Management Trust, Loomis
Sayles Funds I and Loomis Sayles Funds II (collectively, the "CDC Nvest and
Loomis Sayles Trusts") have adopted a deferred payment arrangement under
which each Trustee may elect not to receive fees from the CDC Nvest and
Loomis Sayles Trusts on a current basis but to receive in a subsequent
period an amount equal to the value such fees would have been if they had
been invested in a series or series of the CDC Nvest and Loomis Sayles
Trusts selected by the Trustee on a normal payment date for such fees. As a
result of this arrangement, the CDC Nvest and Loomis Sayles Trusts, upon
making the deferred payments, will be in substantially the same financial
position as if the deferred fees had been paid on the normal payment dates
and immediately reinvested in shares of the series selected by the Trustees.
/(2)/Total Compensation represents amounts paid for the fiscal year ended
January 31, 2005 to a Trustee for serving on the board of trustees of 8
trusts. As of January 31, 2005, the 8 trusts had a total of 41 funds.
Amounts include payments deferred by Trustees.
/(3)/Mr. Voss resigned as a Trustee of the Trusts effective August 20, 2004.
Board Committees and Meetings
Contract Review and Governance Committee (the "Governance Committee"). The
Governance Committee is comprised solely of Independent Trustees and considers
matters relating to advisory, subadvisory and distribution arrangements,
potential conflicts of interest between the investment adviser and the Fund,
governance matters relating to the Fund and the effect on Common Shares of the
use of leveraging through the issuance of the Preferred Shares. The Governance
Committee also reviews and recommends to the Independent Trustees potential
candidates for Trustee membership when necessary. The Board has adopted a
written charter for the Governance Committee, a copy of which is included as
Appendix A.
The Governance Committee will, when a vacancy on the Board of the Fund
exists or is anticipated, consider any candidate for Independent Trustee
recommended by a shareholder of the Fund if such recommendation contains
sufficient background information concerning the candidate to enable a proper
judgment to be made as
8
to the candidate's qualifications, and the recommendation is received in
writing no later than the date specified for receipt of shareholder proposals,
as set forth below under "Shareholder Proposals for 2006 Annual Meeting." Any
such recommendations must be sent to the address indicated below under
"Communications with the Board."
The Governance Committee has not established specific, minimum
qualifications that must be met by an individual to be recommended by the
Governance Committee for nomination as an Independent Trustee. When identifying
an individual to potentially fill a vacancy on the Fund's Board, the Governance
Committee may seek referrals from a variety of sources, including current
Trustees, management of the Fund, and counsel to the Trustees. In evaluating
candidates for a position on the Board, the Governance Committee may consider a
variety of factors, including (i) the candidate's knowledge of the mutual fund
industry; (ii) any experience possessed by the candidate as a director or
senior officer of other public companies; (iii) the candidate's educational
background; (iv) the candidate's reputation for high ethical standards and
personal and professional integrity; (v) any specific financial, technical or
other expertise possessed by the candidate, and the extent to which such
expertise would complement the Board's existing mix of skills and
qualifications; (vi) the candidate's perceived ability to contribute to the
ongoing functions of the Board, including the candidate's ability and
commitment to attend meetings regularly and work collaboratively with other
members of the Board; (vii) the candidate's ability to qualify as an
Independent Trustee for purposes of applicable regulations; and (viii) such
other factors as the Governance Committee determines to be relevant in light of
the existing composition of the Board and any anticipated vacancies or other
transitions. Prior to making a final recommendation to the Board, the
Governance Committee may conduct personal interviews with the candidates it
concludes are the most qualified candidates. Any individuals recommended by
shareholders will be evaluated in the same manner as individuals brought to the
Board's attention in some other manner. A shareholder recommendation of a
candidate for Independent Trustee shall be kept on file and considered by the
Board for six (6) months from the date of receipt after which the shareholder
recommendation shall be considered stale and discarded.
Mr. Baker and Ms. Walker, the two proposed new Trustees, were recommended
for approval by the Governance Committee and nominated by the unanimous vote of
the Independent Trustees.
Audit Committee. The Audit Committee is comprised solely of Independent
Trustees and considers matters relating to the scope and results of the Fund's
audits and serves as a forum in which the Fund's independent accountants can
raise any issues or problems identified in the audit with the Board of
Trustees. The Audit Committee also reviews and monitors compliance with stated
investment objectives and policies and certain Securities and Exchange
Commission (the "SEC") and Treasury regulations as well as operational issues
relating to the transfer agent, auction agent, administrator, sub-administrator
and custodian and the Preferred Shares. In addition, the Audit Committee
implements procedures for receipt, retention and treatment of complaints
received by the Fund regarding its accounting, internal accounting controls and
the confidential, anonymous submission by officers of the Fund or employees of
certain service providers of concerns related to such matters.
The Board of Trustees has determined that each member of the Audit Committee
is "independent" under the listing standards of the American Stock Exchange, on
which the Common Shares of the Fund are listed. The Board has adopted a written
charter for its Audit Committee, a copy of which is included as Appendix B. A
report of the Audit Committee, dated March 16, 2005, is attached to this Proxy
Statement as Appendix C.
Committee Membership. The current membership of each committee is as
follows:
Audit Committee Contract Review and Governance Committee
Daniel M. Cain--Chairman Kenneth J. Cowan--Chairman
Sandra O. Moose Graham T. Allison, Jr.
Edward A. Benjamin Richard Darman
John A. Shane
Paul G. Chenault
9
The committee on which Mr. Baker or Ms. Walker will serve if they are
elected as Trustees of the Trusts has not yet been determined.
Board and Committee Meetings. During the Fund's fiscal year ended January
31, 2005, the Board held 5 meetings, the Contract Review and Governance
Committee held 5 meetings and the Audit Committee held 6 meetings. The Trustees
are not required to attend annual shareholder meetings. None of the Trustees
attended the 2004 Annual Meeting of Shareholders.
Communications with the Board. Shareholders may mail written communications
to the Board of Trustees, addressed as follows: To the Attention of the Board
of Trustees of AEW Real Estate Income Fund, c/o Secretary of the Fund, IXIS
Asset Management Advisors, L.P., 399 Boylston Street, Boston, Massachusetts
02116. Shareholders may also email communications to the Board of Trustees to
secretaryofthefunds@ixisag.com, provided however that communications regarding
recommendations for Trustee candidates may not be submitted by email. This
written communication must (i) be signed by the shareholder, (ii) include the
name and address of the shareholder, (iii) identify that the communication
relates to the Fund, and (iv) identify the account number, class and number of
shares held by the shareholder as of a recent date or the intermediary through
which the shares are held. The Secretary is responsible for collecting,
reviewing and organizing all properly submitted shareholder communications.
Except with respect to shareholder recommendations for candidates for
Independent Trustee, the Secretary shall either (i) provide a copy of each
properly submitted shareholder communications to the appropriate Committee of
the Board, as determined by the Secretary, at the next regularly scheduled
Board meeting or (ii) if the Secretary determines that the communication
requires more immediate attention, forward the communication to the appropriate
Board Committee promptly after receipt; in either case, the Secretary may also
provide, in addition to such shareholder communication, a proposed response to
such communication. The Secretary may, in good faith, determine that a
shareholder communication should not be provided to the Board because it does
not reasonably relate to the Fund or its operations, management, activities,
policies, service providers, Board, officers, shareholders or other matters
relating to an investment in the Fund or is otherwise ministerial in nature
(such as a request for Fund literature, share data or financial information).
These procedures shall not apply to (i) any communication from an officer or
Trustee of the Fund, (ii) any communication from an employee or agent (for
example, an employee of the Fund's investment advisor, administrator,
custodian, distributor and transfer agent) of the Fund, unless such
communication is made solely in such employee's or agent's capacity as a
shareholder, or (iii) any shareholder proposal submitted pursuant to Rule 14a-8
under the Securities Exchange Act of 1934, as amended, or any communication
made in connection with such a proposal (i.e., shareholder proxy proposals).
Required Vote. Election of Mr. Baker and Ms. Walker and reelection of Mr.
Shane to the Board of Trustees of the Fund each will require the affirmative
vote of a plurality of the votes of Common Shareholders and Preferred
Shareholders (voting together as a single class) cast in the election of
Trustees at the Meeting, in person or by proxy. Reelection of Ms. Moose to the
Board of Trustees of the Fund will require the affirmative vote of a plurality
of the votes of the Preferred Shareholders (voting as a separate class) cast in
the election of Trustees at the Meeting, in person or by proxy.
THE BOARD OF TRUSTEES OF THE FUND UNANIMOUSLY RECOMMENDS THAT YOU VOTE FOR EACH
OF THE FOUR NOMINEES FOR TRUSTEE.
II. OTHER BUSINESS
As of the date of this Proxy Statement, the only business that management of
the Fund intends to present or knows that others will present is the election
of four Trustees of the Fund. If any other matters properly come before the
Meeting, and on all matters incidental to the conduct of the Meeting, the
persons named as proxies intend to vote in accordance with their judgment,
unless the Secretary of the Fund has previously received written contrary
instructions from the Shareholder entitled to vote the Shares.
10
III. ADDITIONAL INFORMATION
Shareholder Reports. The Fund's annual report to shareholders for the
fiscal year ended January 31, 2005 may be obtained without charge from the Fund
by calling 1-800-862-4863 or by writing to the Fund at 399 Boylston Street,
Boston, Massachusetts 02116.
Investment Manager. AEW Management and Advisors, L.P. (the "Investment
Manager"), located at Two Seaport Lane, World Trade Center East, Boston,
Massachusetts 02210, serves as investment adviser of the Fund.
Transfer Agent, Auction Agent, Custodian and Administrator. EquiServe Trust
Company, N.A., located at 150 Royall Street, Canton, Massachusetts 02021,
serves as the transfer agent, dividend disbursing agent and registrar of the
Fund's Common Shares. Deutsche Bank Trust Company Americas, located at 280 Park
Avenue, New York, New York 10017, serves as the auction agent for the Fund's
Preferred Shares. Investors Bank & Trust Company, located at 200 Clarendon
Street, Boston, Massachusetts 02116, serves as custodian of the Fund's
investments. IXIS Asset Management Advisors, L.P., located at 399 Boylston
Street, Boston, Massachusetts, 02116, serves as administrator to the Fund.
Independent Registered Public Accountant. PricewaterhouseCoopers LLP
("PwC"), located at 125 High Street, Boston, Massachusetts 02110, has been
selected by the Board as the independent registered public accountant of the
Fund for the current fiscal year ending January 31, 2006.
A representative of PwC, if requested by any Shareholder at a reasonable
time before the Meeting, will be present via telephone at the Meeting to
respond to appropriate questions from Shareholders and will have an opportunity
to make a statement if he or she chooses to do so.
The following table sets forth the aggregate fees billed for professional
services rendered by PwC to the Fund in each of the last two fiscal years ended
January 31, 2004 and January 31, 2005.
Audit- All
Audit Related Tax Other
Fees Fees/(1)/ Fees/(2)/ Fees
------- -------- -------- -----
2004 $20,000 $14,000 $7,000 $0
2005 $20,000 $10,000 $1,250 $0
--------
/(1)/Fees associated with the following audit-related services:
Year ended January 31, 2004
. $4,000--July 31, 2003 SAS 100 review procedures performed
for the Fund.
. $10,000--Rating agency agreed-upon procedures reports for
the Fund.
Year ended January 31, 2005
. $5,000--July 31, 2004 SAS 100 review procedures performed
for the Fund.
. $5,000--Rating agency agreed-upon procedures reports for
the Fund.
/(2)/Fees for years ended January 31, 2004 and 2005 are for tax
services for the Fund.
On an annual basis, the Treasurer of the Fund submits to the Audit Committee
information on the audit, audit-related, tax and other non-audit services to be
provided to the Fund that require pre-approval by the Audit Committee. This
information provides a description of each type of service that is expected to
require pre-approval, the maximum fees that can be paid for each service
without further approval and the rationale for engaging the independent auditor
to perform each service. The Audit Committee reviews and approves these
services and reviews the projected fees for the next calendar year.
A report is provided to the Audit Committee at regularly scheduled,
quarterly Audit Committee meetings containing a summary of the services
provided during the prior quarter and the level of fees associated with those
11
services. Any subsequent revisions to already pre-approved services or fees
(including fee increases) are also presented for consideration at the quarterly
meetings as needed. If subsequent to the annual pre-approval of services by the
Audit Committee, the Fund or one of its affiliates determine that they would
like to engage the Fund's independent auditors to perform a service not already
pre-approved, the Fund or such affiliate submits a request to the Treasurer. If
the Treasurer determines that the service fits within the independence
guidelines (e.g., it is not a prohibited service), the Treasurer will arrange
for a discussion of the service to be included on the agenda for the next
regularly scheduled Audit Committee meeting so that pre-approval can be
considered.
If, in the opinion of the Treasurer of the Fund, a proposed engagement needs
to commence before the next regularly scheduled Audit Committee meeting, the
Treasurer shall submit a written summary of the proposed engagement to all
members of the Audit Committee outlining the services, the estimated maximum
cost, the category of the services (e.g., audit, audit-related, tax or other)
and the rationale for engaging the independent auditor to perform the services.
Pursuant to procedures approved by the Board, to the extent the proposed
engagement involves audit, audit-related or tax services, any one individual
member of the Audit Committee who is an Independent Trustee is authorized under
these procedures to pre-approve the engagement. To the extent the proposed
engagement involves non-audit services other than audit, audit-related or tax,
the entire Audit Committee must pre-approve the engagement. The Treasurer will
arrange for this interim review and coordinate with the appropriate member(s)
of the Audit Committee. An independent auditor must not commence the engagement
under consideration until the Treasurer has indicated that the requisite
approval has been obtained. The member of the Audit Committee who pre-approves
any engagements between regularly scheduled Audit Committee meetings must
report, for informational purposes only, any such pre-approval decisions to the
Audit Committee at its next regularly scheduled meeting. The percentage of
"Audit-Related Fees," "Tax Fees" and "All Other Fees" set forth in the table
above that were not pre-approved pursuant to 17 CFR 210.2-01(c)(7)(i)(C) was
zero.
The following table sets forth the aggregate fees billed for non-audit
services rendered by PwC to the Fund and to the Investment Manager, and any
other entity controlling, controlled by or under common control with the
Investment Manager that provides services to the Fund during each of the last
two fiscal years ended January 31, 2004 and January 31, 2005.
Non-Audit
Fees
---------
2004 $216,000
2005 $191,250
In approving the selection of PwC, the Audit Committee considered, in
addition to other practices and requirements relating to the selection of the
Fund's auditors, whether PwC's provision of the non-audit services covered in
the table above under "Non-Audit Fees" for the Fund, the Investment Manager and
for certain related other parties are compatible with maintaining the
independence of PwC as the Fund's principal accountants. Please refer to the
Audit Committee Report in Appendix C to this Proxy Statement.
Section 16(a) Beneficial Ownership Reporting Compliance. Section 16(a) of
the Securities Exchange Act of 1934 and Section 30(f) of the 1940 Act require
the Fund's Trustees and Officers and certain other persons to file within
certain designated time periods certain reports regarding ownership of, and
transactions in, the Fund's securities with the Securities and Exchange
Commission. Copies of the required filings must also be furnished to the Fund.
Based solely upon a review of copies of such reports furnished to the Fund, the
Fund believes Initial Statements of Beneficial Ownership on Form 3 may not have
been filed on a timely basis for Mr. Michael Kardok, Treasurer of the Fund. Mr.
Kardok did not own or dispose of shares of the Fund during the reporting period.
12
Information About Proxies
Solicitation of Proxies and Costs of Solicitation. Proxies will be
solicited primarily by mailing this Proxy Statement and its enclosures. The
cost of soliciting proxies for the Fund will be borne by the Fund. In addition,
certain officers of the Fund and certain officers and employees of the
Investment Manager or its affiliates (none of whom will receive additional
compensation therefor) may solicit proxies by telephone, mail, email and
personal interviews. In addition, D.F. King & Co., Inc. may be engaged to
assist in the solicitation of proxies, the cost of which will be borne by the
Fund and is estimated to be approximately $1,500 in the aggregate, plus
out-of-pocket expenses.
Quorum, Adjournments and Methods of Tabulation. A quorum for the Fund at
the Meeting will consist of the presence in person or by proxy of thirty three
and 1/3 percent (33 1/3%) of the total Shares of the Fund entitled to vote at
the Meeting. In the event that a quorum is not present at the Meeting for the
Fund or, even if a quorum is so present, in the event that sufficient votes to
elect all the Nominees are not received by the time scheduled for the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting with no other notice than announcement at the Meeting, to permit
further solicitation of proxies with respect to the Proposal. In addition, if,
in the judgment of the persons named as proxies, it is advisable to defer
action on the Proposal, the persons named as proxies may propose one or more
adjournments of the Meeting with respect to the Proposal for a reasonable time.
Any adjournments will be decided by a plurality of the Shares entitled to vote
present in person or represented by proxy at the session of the Meeting to be
adjourned. The persons named as proxies will vote in favor of such adjournment
those proxies which they are entitled to vote in favor of any of the Nominees.
They will vote against any such adjournment those proxies required to be voted
against all of the Nominees and will not vote any proxies that withhold
authority to vote on the election of all the Nominees. The costs of any
additional solicitation and of any adjourned session will be borne by the Fund.
Votes cast by proxy or in person at the Meeting will be counted by persons
appointed by the Fund as tellers (the "Tellers") for the Meeting. The Tellers
will count the total number of votes cast "for" approval of each nominee for
purposes of determining whether sufficient affirmative votes have been cast.
The Tellers will count shares represented by proxies that reflect abstentions
and "broker non-votes" (i.e., shares held by brokers or nominees as to which
(i) instructions have not been received from the beneficial owners or the
persons entitled to vote and (ii) the broker or nominee does not have
discretionary voting power on a particular matter) as shares that are present
and entitled to vote on the matter for purposes of determining the presence of
a quorum. With respect to the election of Trustees, assuming a quorum is
present, neither abstentions nor broker non-votes have any effect on the
outcome of the election.
Shareholder Proposals for 2006 Annual Meeting. It is currently anticipated
that the Fund's next annual meeting of Shareholders will be held in May 2006.
Under the Fund's Bylaws, shareholders submitting any proposals for the Fund
intended to be presented at the 2006 annual meeting must ensure that such
proposals are received by the Fund, in good order and in compliance with all
applicable legal requirements, no later than March 12, 2006 and not earlier
than February 25, 2006. Shareholders who wish for the Fund to include a
proposal in the proxy statement for next year's annual meeting of shareholders
pursuant to Rule 14a-8 under the Exchange Act of 1934 must submit their
proposal so that it is received by the Fund no later than December 28, 2005.
The submission by a Shareholder of a proposal for inclusion in the proxy
materials does not guarantee that it will be included. Shareholder proposals
are subject to certain requirements under the federal securities laws and must
be submitted in accordance with the Fund's Bylaws and the Exchange Act of 1934.
Shareholder proposals should be addressed to the attention of the Secretary of
the Fund.
13
Significant Shareholders. As of April 8, 2005, the following shareholders
beneficially or of record owned 5% or more of the outstanding shares of the
noted class of the Fund:
Number of Percentage
Shares of Shares of
Title of Class Name and Address of Record Owner Owned Class Owned
-------------- -------------------------------- ------------ ------------
Common Shares
Cede & Co./(1) (2)/ 3,821,461.00 99.69%
55 Water Street, 25th Floor
New York, New York 10041
Preferred Shares
First Clearing, LLC/(1) (3)/ 89 7.95%
901 East Byrd Street
Richmond, Virginia 23219
Fleet National Bank/(1) (3)/ 400 35.71%
159 East Main Street
Rochester, New York 14638
Merrill Lynch, Pierce, Fenner & Smith Safekeeping/(1) (3)/ 475 42.41%
4 Corporate Place
Piscataway, New Jersey 08854
Merrill Lynch, Pierce, Fenner & Smith Incorporated/(1) (3)/ 83 7.41%
101 Hudson Street 9th Floor
Jersey City, New Jersey 07302
--------
/(1)/Such ownership may be beneficially held by individuals or entities other
than the owner listed. To the extent that any listed shareholder
beneficially owns more than 25% of the Fund, it may be deemed to "control"
the Fund within the meaning of the 1940 Act.
/(2)/A nominee for participants in the Depository Trust Company.
/(3)/Shares held at the Depository Trust Company.
Ownership of Shares by Management. As of April 8, 2005, none of the
Trustees/Nominees and Executive Officers of the Fund owned any of the Fund's
outstanding Common Shares or Preferred Shares.
14
Appendix A
Charter of the Contract Review and Governance Committee
of
CDC Nvest Funds Trust I
CDC Nvest Funds Trust II
CDC Nvest Funds Trust III
CDC Nvest Cash Management Trust
CDC Nvest Companies Trust I
AEW Real Estate Income Fund
Loomis Sayles Funds I
Loomis Sayles Funds II
1) The Contract Review & Governance Committee (the "Committee") of CDC Nvest
Funds Trust I, CDC Nvest Funds Trust II, CDC Nvest Funds Trust III, CDC Nvest
Cash Management Trust, CDC Nvest Companies Trust I, AEW Real Estate Income
Fund, Loomis Sayles Funds I and Loomis Sayles Funds II (the "Trusts") shall be
composed entirely of independent trustees.
2) The purposes of the Committee are:
a) Contract Review Matters:
i) To request and evaluate such information as may reasonably be
necessary to evaluate the terms of the advisory agreements, subadvisory
agreements, distribution agreements and related distribution plans
pursuant to Rule 12b-1 relating to the funds in each Trust on an annual
basis and as needed throughout the year;
ii) To monitor the performance of the advisers and oversee the
performance of the subadvisers to the funds in each Trust on a quarterly
and annual basis, and as needed throughout the year;
iii) To monitor the discount or premium, if any, of the closed end
fund's market price on the American Stock Exchange to its net asset
value;
iv) To monitor the effect of the use of leveraging (through the
issuance of preferred shares) of the closed-end fund on common share
total return;
v) To hold scheduled meetings on a regular basis in order to conduct
such Committee business and report to the full Board of Trustees at
their next regularly scheduled meeting or sooner; and
vi) To submit minutes of such meetings to the full Board on a regular
basis.
b) Governance Matters:
i) The Committee (or a subcommittee established by the Board) shall
make and consider nominations for independent trustee membership on the
Board of Trustees when necessary, pursuant to the procedures set forth
in Appendix A hereto;
ii) The Committee shall, at least annually, review board governance
practices and procedures and shall recommend any appropriate changes to
the full board;
iii) The Committee shall periodically review the composition of the
board to determine whether it may be appropriate to add individuals with
different backgrounds or skill sets from those already on the board;
iv) The Committee shall, at least annually, review trustee
compensation and shall recommend any appropriate changes to the
independent trustees;
v) The Committee shall review committee assignments on an annual
basis; and
A-1
vi) The Committee shall review as necessary the responsibilities of
each committee of the Board, whether there is continuing need for each
committee, whether there is a need for additional committees of the
Board, and whether committees should be combined or reorganized. The
Committee shall make recommendations for any such action to the full
board.
3) Other Powers and Responsibilities:
a) The Committee shall monitor the performance of legal counsel employed
by the Trusts and the independent trustees, and shall be responsible for the
supervision of counsel for the independent trustees;
b) The Committee shall have the resources and authority appropriate to
discharge its responsibilities, including authority to retain special
counsel and other experts or consultants at the expense of the appropriate
Trust;
c) When appropriate the Committee shall review potential conflict of
interest situations; and
d) The Committee shall review this charter at least annually and
recommend any changes to the full board.
--------------------------------------------------------------------------------
Appendix A to the Charter--Procedures with Respect to Nominees to the Board
I. Identification of Candidates. When a vacancy on the Board of the Trusts
exists or is anticipated, the Committee may make nominations for Trustee
membership. When nominating an individual to fill a vacancy on the Trust's
Board, the Committee may seek referrals from a variety of sources, including
current Trustees, management of the Funds, Funds counsel and counsel to the
Independent Trustees, and shareholders of a Fund who submit recommendations
in accordance with these procedures. The Committee has not established
specific, minimum qualifications that must be met by an individual in order
for such person to be considered by the Committee for nomination as an
Independent Trustee.
II.Shareholder Candidates. Except as provided below, the Committee also shall
consider any candidate for Independent Trustee recommended by a shareholder
of a Trust if such recommendation contains sufficient background information
concerning the candidate to enable a proper judgment to be made as to the
candidate's qualifications, and the recommendation is received in a
sufficiently timely manner (and in any event no later than the date
specified for receipt of shareholder proposals in any applicable proxy
statement with respect to a Fund). Shareholders shall be directed to address
any such recommendations to the attention of the Board of Trustees, c/o
Secretary of the Trust. The Trusts may adopt different and/or more detailed
requirements with respect to shareholder nominations of Trustee candidates.
Such requirements may be contained in a Trust's Declaration of Trust or
Bylaws. For example, the Bylaws of the AEW Real Estate Income Fund contain
detailed requirements that must be met by shareholders submitting Trustee
candidates. In such case, any shareholder nominations must meet such
requirements in order to be considered. A recommendation from a shareholder
shall be kept on file and considered by the Board for six (6) months from
the date of receipt, after which the recommendation shall be considered
stale and discarded.
III.Evaluation of Candidates. In evaluating nominees for a position on the
Board, the Committee may consider any factors it deems appropriate,
including, without limitation, (i) the nominee's knowledge of the mutual
fund industry; (ii) any experience possessed by the nominee as a director
or senior officer of other public companies; (iii) the nominee's
educational background; (iv) the nominee's reputation for high ethical
standards and personal and professional integrity; (v) any specific
financial, technical or other expertise possessed by the nominee, and the
extent to which such expertise would complement the Board's existing mix of
skills and qualifications; (vi) the nominee's perceived ability to
contribute to the ongoing functions of the Board, including the nominee's
ability and commitment to attend meetings regularly and work
collaboratively with other members of the Board; (vii) the nominee's
ability to qualify as an Independent Trustee for purposes of applicable
regulations; and (viii) the existing composition of the Board and any
anticipated vacancies or other transitions. Any individuals recommended by
shareholders will be evaluated in the same manner as individuals brought to
the Board's attention in some other manner.
A-2
Appendix B
Audit Committee
of
CDC Nvest Funds Trust I
CDC Nvest Funds Trust II
CDC Nvest Funds Trust III
CDC Nvest Cash Management Trust
CDC Nvest Companies Trust I
AEW Real Estate Income Fund
Loomis Sayles Funds I
Loomis Sayles Funds II
CHARTER
1) The Audit Committee (the "Committee") of CDC Nvest Funds Trust I, CDC
Nvest Funds Trust II, CDC Nvest Funds Trust III, CDC Nvest Cash Management
Trust, CDC Nvest Companies Trust I, AEW Real Estate Income Fund, Loomis Sayles
Funds I and Loomis Sayles Funds II (the "Trusts"):
a) shall be composed entirely of trustees who are not "interested
persons" (as defined for purposes of the Investment Company Act of 1940) of
the Trusts; and
b) with respect to the Audit Committee of the AEW Real Estate Income Fund
only:
i) shall be composed entirely of trustees who (i) meet the
independence standards set forth in Section 121(A) of the American Stock
Exchange Company Guide (Listing Standards, Policies and Requirements)
(the "AMEX Guide") and any additional or different independence
standards adopted by the American Stock Exchange to implement the
standards set forth in Rule 10A-3 under the Securities Exchange Act of
1934 and (ii) the financial literacy requirements set forth in the first
sentence of Section 121(B)(a)(ii) of the AMEX Guide; and
ii) shall include at least one trustee who meets the financial
sophistication and experience requirements set forth in Section
121(B)(a)(ii) of the AMEX Guide.
2) The purposes of the Committee are:
a) to oversee the Trusts' accounting and financial reporting policies and
practices, its internal controls and, as appropriate, the internal controls
of certain service providers;
b) to oversee the quality and objectivity of the Trusts' financial
statements and the independent audit thereof;
c) to review such aspects of the operations of the Trusts as the
Committee or the full Board of Trustees shall deem appropriate;
d) to act as liaison between the Trusts' independent auditors and the
full Board of Trustees;
e) to review operational issues relating to the preferred shares of the
AEW Real Estate Income Fund, including performance by the auction agent of
its duties in connection with the auctions;
f) to oversee any issues in connection with the AEW Real Estate Income
Fund's implementation of a managed dividend policy;
g) to oversee, pursuant to Section 307 of the Sarbanes-Oxley Act of 2002,
the Funds' "reporting up" compliance process for attorneys appearing and
practicing before the Securities and Exchange Commission in the
representation of the Funds, as such process is implemented by the Funds'
Chief Legal Officer;
h) to hold scheduled meetings on a quarterly basis, or more frequently if
the Committee determines that more frequent meetings are necessary for it to
fulfill its responsibilities, in order to conduct such Committee business
and report to the full Board of Trustees at their next regularly scheduled
meeting or sooner; and
B-1
i) to submit minutes of such meetings to the full Board of Trustees on a
regular basis.
The function of the Audit Committee is oversight; it is management's
responsibility to maintain appropriate systems for accounting and internal
control, the auditors' responsibility to plan and carry out a proper audit, and
management's and the auditors' responsibility to determine that the Trusts'
financial statements are complete and accurate and in accordance with generally
accepted accounting principles.
3) Powers and Responsibilities:
a) Audit Matters:
(1) the auditors are ultimately responsible to the Audit Committee
and, with respect to all Trusts other than the AEW Real Estate Income
Fund, the full Board of Trustees, as representatives of the Trusts'
shareholders, and the Audit Committee has the ultimate authority and
responsibility for the selection, evaluation, compensation (at the
expense of the relevant Trust(s)) and, where appropriate, replacement of
the auditors (or, if applicable, to nominate the auditors to be proposed
for shareholder approval in any proxy statement), who will report
directly to the Audit Committee, and, in connection therewith, to
evaluate the independence of the auditors, including, to the extent
required by applicable law, a review of any non-audit services provided
to any entities in the same investment company complex as the Trusts,
and to receive from the auditors a formal written statement delineating
all relationships between the auditors and the Trusts consistent with
Independence Standards Board Standard No. 1, to actively engage in a
dialogue with the auditors with respect to any disclosed relationships
or services that may impact the objectivity and independence of the
auditors, and to take, or recommend that the full Board of Trustees
take, appropriate action to oversee the independence of the auditors;
(2) to meet with the Trusts' independent auditors, including private
meetings, and to request such information as they deem appropriate in
connection therewith, as necessary to discuss the matters required to be
discussed by Statement of Auditing Standards No. 61, including without
limitation, (i) the arrangements for and scope of the annual audit and
any special audits; (ii) any matters of concern relating to the Trusts'
financial statements, including any adjustments to such statements
recommended by the auditors, or other results of said audit(s); (iii)
the auditors' comments with respect to the Trusts' financial policies,
procedures and internal accounting controls and management's response
thereto; and (iv) the form of opinion the auditors propose to render to
the Board of Trustees and shareholders;
(3) to the extent required by applicable law, to approve all audit
and non-audit services rendered to the Trusts and all non-audit services
rendered to the Trusts' investment advisers and certain of their
affiliates; provided, however, that the Audit Committee may implement
policies and procedures pursuant to which services are pre-approved
other than by the full Audit Committee, subject to the requirement that
the full Audit Committee be notified in a timely manner of each such
service;
(4) to consider the effect upon the Trusts of any changes in
accounting principles or practices proposed by management or the
auditors; to review an analysis, if any, prepared by the Trusts'
management and auditors of significant financial reporting issues and
judgments (including issues relating to the valuation of the Trusts'
portfolio securities) made in connection with the preparation of the
Trusts' financial statements; and to resolve disagreements between the
Trusts' management and the auditors regarding financial reporting;
(5) to review the fees charged by the auditors for audit and
non-audit services;
(6) to review and discuss the Trusts' financial statements with
management; and
(7) with respect to the AEW Real Estate Income Fund only, to consider
whether to recommend to the Board of Trustees that the Trusts' audited
financial statements be included in the Trusts' annual reports to
shareholders.
B-2
b) Operational Matters:
(1) to review performance of the transfer agent, sub-transfer agents,
custodian, sub-custodians and other service providers to the Trusts;
(2) to review such operational matters with respect to the advisers
and subadvisers to the Trusts as the Committee shall deem appropriate;
(3) to review the codes of ethics of the advisers and subadvisers to
the Trusts and review and evaluate reports of any violations of such
codes of ethics;
(4) to investigate any improprieties in Trust operations, including
the establishment of procedures for the receipt, retention and treatment
of complaints regarding accounting, internal accounting controls or
auditing matters, including procedures for the confidential, anonymous
submission of concerns regarding questionable accounting or auditing
matters;
(5) to review dividend and capital gain distributions;
(6) to report its activities to the full Board of Trustees on a
regular basis and to make such recommendations with respect to the above
and other matters as the Committee may deem necessary or appropriate; and
(7) to regularly meet with the Treasurer or other officers of the
Trusts, if the Committee deems such meetings are necessary;
4) Additional Powers and Responsibilities.
a) the Committee shall have the resources and authority necessary or
appropriate to discharge its responsibilities, including the authority to
retain independent counsel and other advisers, experts or consultants at the
expense of the appropriate Trust;
b) when appropriate, and to the full extent required by Section 120 of
the AMEX Guide, the Audit Committee shall review potential conflict of
interest situations; and
c) the Committee shall review this Charter at least annually and
recommend any changes to the full Board of Trustees.
B-3
Appendix C
The Audit Committee of the Board of Trustees issued the following report
concerning the financial statements for the Fund's most recent fiscal year.
The Audit Committee reviewed and discussed the audited financial statements
with Fund management. The Audit Committee also discussed with
PricewaterhouseCoopers LLP, the Fund's independent registered public
accountants, the matters required to be discussed by SAS 90 (Audit Committee
Communications), which amends SAS 61 (Communication with Audit Committees). The
Audit Committee received the written disclosures and the letter from
PricewaterhouseCoopers LLP required by Independence Standards Board Standard
No. 1 (Communications with Audit Committees), and discussed with
PricewaterhouseCoopers LLP its independence.
Based on this review and these discussions, the Audit Committee recommended
to the Board of Trustees that the audited financial statements be included in
the Fund's annual report to shareholders for the fiscal year ended January 31,
2005 for filing with the Securities and Exchange Commission.
Edward A. Benjamin
Daniel M. Cain
Sandra O. Moose
C-1
[THIS PAGE INTENTIONALLY LEFT BLANK]
RIFPROXY-0405
*AEW logo**
C/O EQUISERVE TRUST COMPANY, N.A.
P.O. BOX 8694
EDISON, NJ 08818-8694
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
[X] Please mark votes as in this example.
1. Election of trustees.
Nominees: (01) Mr. Charles D. Baker
(02) Mr. John A. Shane
(03) Ms. Cynthia L. Walker
(04) Ms. Sandra O. Moose
FOR ALL NOMINEES [ ] [ ] WITHHELD FROM ALL NOMINEES
[ ]
--------------------------------------------------
(To withhold authority for a nominee, check this box and list the names of such
nominee(s) on the line above. Your shares will be voted for the remaining
nominees.)
Mark box at right if you plan to attend the Annual Meeting. [ ]
Mark box at right if an address change or comment has been noted on the
reverse side of this card. [ ]
Please sign this proxy exactly as name appears hereon. When shares are held by
joint tenants, both should sign. When signing as attorney, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name and indicate the signer's office. If a partnership,
sign in the partnership name.
Signature: Date: Signature: Date:
----------- ---------- ----------- -----------
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
AEW REAL ESTATE INCOME FUND
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF TRUSTEES OF THE FUND
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON
JUNE 15, 2005
The undersigned hereby appoints Michael Kardok, Russell Kane and Coleen Downs
Dinneen, and each of them separately, will full power of substitution, as
proxies for the undersigned, to vote, act and consent with respect to any and
all shares of AEW Real Estate Income Fund (the "Fund"), which the undersigned is
entitled to vote at the Annual Meeting of Shareholders of the Fund (the
"Meeting") to be held at IXIS Asset Management Advisors, L.P., 399 Boylston
Street, 10th Floor, Boston, MA 02116, at 2:00 p.m.., on Wednesday, June 15,
2005, and at any continuation or adjournment thereof, with all powers the
undersigned would possess if personally present, upon such business as may
properly come before the Meeting including the matters indicated on the reverse
side.
THIS PROXY WILL BE VOTED AS DIRECTED. IN THE ABSENCE OF DIRECTION, THIS PROXY
WILL BE VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1.
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Meeting. The Trustees recommend a vote FOR each
nominee.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement.
--------------------------------------------------------------------------------
SHAREHOLDERS ARE URGED TO MARK, SIGN AND RETURN THIS PROXY IN THE ENVELOPE
PROVIDED. PLEASE DO NOT FORGET TO DATE THIS PROXY.
--------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
------------------------- -------------------------
------------------------- -------------------------
------------------------- -------------------------
*AEW logo**
C/O EQUISERVE TRUST COMPANY, N.A.
P.O. BOX 8694
EDISON, NJ 08818-8694
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
[X] Please mark votes as in this example.
1. Election of trustees.
Nominees: (01) Mr. Charles D. Baker
(02) Mr. John A. Shane
(03) Ms. Cynthia L. Walker
FOR ALL NOMINEES [ ] [ ] WITHHELD FROM ALL NOMINEES
[ ]
--------------------------------------------------
(To withhold authority for a nominee, check this box and list the names of such
nominee(s) on the line above. Your shares will be voted for the remaining
nominees.)
Mark box at right if you plan to attend the Annual Meeting. [ ]
Mark box at right if an address change or comment has been noted on the
reverse side of this card. [ ]
Please sign this proxy exactly as name appears hereon. When shares are held by
joint tenants, both should sign. When signing as attorney, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name and indicate the signer's office. If a partnership,
sign in the partnership name.
Signature: Date: Signature: Date:
----------- ---------- ----------- -----------
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
AEW REAL ESTATE INCOME FUND
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF TRUSTEES OF THE FUND
PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS ON
JUNE 15, 2005
The undersigned hereby appoints Michael Kardok, Russell Kane and Coleen Downs
Dinneen, and each of them separately, will full power of substitution, as
proxies for the undersigned, to vote, act and consent with respect to any and
all shares of AEW Real Estate Income Fund (the "Fund"), which the undersigned is
entitled to vote at the Annual Meeting of Shareholders of the Fund (the
"Meeting") to be held at IXIS Asset Management Advisors, L.P., 399 Boylston
Street, 10th Floor, Boston, MA 02116, at 2:00 p.m., on Wednesday, June 15, 2005,
and at any continuation or adjournment thereof, with all powers the undersigned
would possess if personally present, upon such business as may properly come
before the Meeting including the matters indicated on the reverse side.
THIS PROXY WILL BE VOTED AS DIRECTED. IN THE ABSENCE OF DIRECTION, THIS PROXY
WILL BE VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1.
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Meeting. The Trustees recommend a vote FOR each
nominee.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement.
--------------------------------------------------------------------------------
SHAREHOLDERS ARE URGED TO MARK, SIGN AND RETURN THIS PROXY IN THE ENVELOPE
PROVIDED. PLEASE DO NOT FORGET TO DATE THIS PROXY.
--------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
------------------------- -------------------------
------------------------- -------------------------
------------------------- -------------------------