<SEC-DOCUMENT>0000950135-04-005822.txt : 20120828
<SEC-HEADER>0000950135-04-005822.hdr.sgml : 20120828

<ACCEPTANCE-DATETIME>20041221145759

<PRIVATE-TO-PUBLIC>

ACCESSION NUMBER:		0000950135-04-005822

CONFORMED SUBMISSION TYPE:	N-2/A

PUBLIC DOCUMENT COUNT:		16

FILED AS OF DATE:		20041221

DATE AS OF CHANGE:		20050314


FILER:


	COMPANY DATA:	

		COMPANY CONFORMED NAME:			Eaton Vance Enhanced Equity Income Fund II

		CENTRAL INDEX KEY:			0001308335

		IRS NUMBER:				000000000



	FILING VALUES:

		FORM TYPE:		N-2/A

		SEC ACT:		1933 Act

		SEC FILE NUMBER:	333-120421

		FILM NUMBER:		041216975



	BUSINESS ADDRESS:	

		STREET 1:		TWO INTERNATIONAL PLACE

		CITY:			BOSTON

		STATE:			MA

		ZIP:			02110

		BUSINESS PHONE:		617-482-8260



	MAIL ADDRESS:	

		STREET 1:		TWO INTERNATIONAL PLACE

		CITY:			BOSTON

		STATE:			MA

		ZIP:			02110




FILER:


	COMPANY DATA:	

		COMPANY CONFORMED NAME:			Eaton Vance Enhanced Equity Income Fund II

		CENTRAL INDEX KEY:			0001308335

		IRS NUMBER:				000000000



	FILING VALUES:

		FORM TYPE:		N-2/A

		SEC ACT:		1940 Act

		SEC FILE NUMBER:	811-21670

		FILM NUMBER:		041216976



	BUSINESS ADDRESS:	

		STREET 1:		TWO INTERNATIONAL PLACE

		CITY:			BOSTON

		STATE:			MA

		ZIP:			02110

		BUSINESS PHONE:		617-482-8260



	MAIL ADDRESS:	

		STREET 1:		TWO INTERNATIONAL PLACE

		CITY:			BOSTON

		STATE:			MA

		ZIP:			02110



</SEC-HEADER>

<DOCUMENT>
<TYPE>N-2/A
<SEQUENCE>1
<FILENAME>b52674a1nv2za.txt
<DESCRIPTION>EATON VANCE ENHANCED EQUITY INCOME FUND II
<TEXT>
<PAGE>

       As filed with the Securities and Exchange Commission on December 21, 2004
                                                    1933 Act File No. 333-120421
                                                     1940 Act File No. 811-21670

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM N-2

                             REGISTRATION STATEMENT
                      UNDER THE SECURITIES ACT OF 1933    [ ]
                        PRE-EFFECTIVE AMENDMENT NO. 1     [X]
                        POST-EFFECTIVE AMENDMENT NO.      [ ]

                                     AND/OR

                        REGISTRATION STATEMENT UNDER THE
                       INVESTMENT COMPANY ACT OF 1940     [ ]
                               AMENDMENT NO. 1            [X]
                        (CHECK APPROPRIATE BOX OR BOXES)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II
                -------------------------------------------------
               (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

     THE EATON VANCE BUILDING, 255 STATE STREET, BOSTON, MASSACHUSETTS 02109
     -----------------------------------------------------------------------
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

        REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (617) 482-8260
        -----------------------------------------------------------------

                                 ALAN R. DYNNER
     THE EATON VANCE BUILDING, 255 STATE STREET, BOSTON, MASSACHUSETTS 02109
     -----------------------------------------------------------------------
                     NAME AND ADDRESS (OF AGENT FOR SERVICE)

                          COPIES OF COMMUNICATIONS TO:

     MARK P. GOSHKO, ESQ.                        THOMAS A. HALE, ESQ.
  KIRKPATRICK & LOCKHART LLP           SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
       75 STATE STREET                    333 WEST WACKER DRIVE, SUITE 2100
 BOSTON, MASSACHUSETTS 02109                   CHICAGO, ILLINOIS 60606

      APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: As soon as practicable after
the effective date of this Registration Statement.

      If any of the securities being registered on this form are to be offered
on a delayed or continuous basis in reliance on Rule 415 under the Securities
Act of 1933, as amended, other than securities offered in connection with a
dividend reinvestment plan, check the following box. [ ]

      It is proposed that this filing will become effective (check appropriate
box):

     [ ] when declared effective pursuant to Section 8(c)

<PAGE>

CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933

<TABLE>
<CAPTION>
                                                              PROPOSED             PROPOSED
                                         AMOUNT BEING         MAXIMUM               MAXIMUM                 AMOUNT OF
                                          REGISTERED          OFFERING              AGGREGATE            REGISTRATION FEES
TITLE OF SECURITIES BEING REGISTERED          (1)          PRICE PER UNIT(1)     OFFERING PRICE(1)           (1)(2)(3)
------------------------------------     ------------      -----------------     -----------------       -----------------
<S>                                      <C>               <C>                   <C>                     <C>
Common Shares of Beneficial
Interest, $0.01 par value                   50,000             $20.00               $1,000,000                $126.70
                                            ------             ------               ----------                -------
</TABLE>

(1)   Estimated solely for purposes of calculating the registration fee,
      pursuant to Rule 457(o) under the Securities Act of 1933.

(2)   Includes Shares that may be offered to the Underwriters pursuant to an
      option to cover over-allotments.

(3)   A Registration fee of $126.70 was previously paid in connection with the
      initial filing filed on November 12, 2004.

      THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATES AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
<PAGE>

THE INFORMATION IN THIS PROSPECTUS IS INCOMPLETE AND MAY BE CHANGED. WE MAY NOT
SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL
THESE SECURITIES, AND WE ARE NOT SOLICITING OFFERS TO BUY THESE SECURITIES, IN
ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

PRELIMINARY PROSPECTUS          SUBJECT TO COMPLETION          December 27, 2004
--------------------------------------------------------------------------------

                              SHARES

                EATON VANCE ENHANCED EQUITY INCOME FUND II

                COMMON SHARES
[EATON VANCE LOGO]

--------------------------------------------------------------------------------

INVESTMENT OBJECTIVES.  Eaton Vance Enhanced Equity Income Fund II (the "Fund")
is a newly organized, diversified, closed-end management investment company. The
Fund's primary investment objective is to provide current income, with a
secondary objective of capital appreciation. The Fund will pursue its investment
objectives by investing primarily in a portfolio of mid- and
large-capitalization common stocks, seeking to invest primarily in companies
with above-average growth and financial strength. Under normal market
conditions, the Fund will seek to generate current earnings from option premiums
by selling covered call options on a substantial portion of its portfolio
securities. There can be no assurance that the Fund will achieve its investment
objectives.

INVESTMENT ADVISER AND SUB-ADVISER.  The Fund's investment adviser is Eaton
Vance Management ("Eaton Vance" or the "Adviser"). As of October 31, 2004, Eaton
Vance and its subsidiaries managed approximately $94.5 billion on behalf of
funds, institutional clients and individuals, including approximately $55.8
billion in equity assets. Eaton Vance has engaged Rampart Investment Management
Company, Inc. ("Rampart" or the "Sub-Adviser") as a sub-adviser to provide
advice on and execution of the Fund's options strategy. Rampart, founded in
1983, specializes in options management and trading for institutional and high
net worth investors. Rampart managed approximately $1.8 billion in assets as of
November 30, 2004.

PORTFOLIO CONTENTS.  Under normal market conditions, the Fund will invest at
least 80% of its total assets in common stocks. Normally, the Fund will invest
primarily in common stocks of mid- and large-capitalization issuers that meet
the Fund's selection criteria of above-average growth and financial strength.
Initially, the Fund expects to invest between 55% and 65% of its total assets in
mid-capitalization stocks and between 35% and 45% of its total assets in
large-capitalization stocks. Under normal market conditions, the Fund expects to
invest in at least 75 securities, seeking to reduce the Fund's exposure to
individual stock risks. The Fund generally will invest in common stocks on which
exchange traded call options are currently available. The Fund will invest
primarily in common stocks of U.S. issuers, although the Fund may invest up to
25% of its total assets in securities of foreign issuers.   (continued on inside
front cover)

BECAUSE THE FUND IS NEWLY ORGANIZED, ITS COMMON SHARES HAVE NO HISTORY OF PUBLIC
TRADING.

INVESTING IN SHARES INVOLVES CERTAIN RISKS. SEE "INVESTMENT OBJECTIVES, POLICIES
AND RISKS" BEGINNING AT PAGE 13.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<Table>
<Caption>
                                                              PRICE TO PUBLIC   SALES LOAD(1)     PROCEEDS TO FUND
------------------------------------------------------------------------------------------------------------------
<S>                                                           <C>               <C>               <C>
Per share                                                       $20.00           $0.90               $19.10
------------------------------------------------------------------------------------------------------------------
Total                                                           $                $                   $
------------------------------------------------------------------------------------------------------------------
Total assuming full exercise of the over-allotment option       $                $                   $
------------------------------------------------------------------------------------------------------------------
</Table>

(1)  Eaton Vance (not the Fund) will pay certain additional compensation to
     qualifying underwriters. See "Underwriting." Eaton Vance (not the Fund)
     will pay UBS Securities LLC for services provided pursuant to a shareholder
     servicing agreement between UBS Securities LLC and Eaton Vance. See
     "Underwriting."

In addition to the sales load, the Fund will pay offering expenses of up to
$0.04 per share, estimated to total $       , which will reduce the "Proceeds to
Fund" (above). Eaton Vance or an affiliate has agreed to pay the amount by which
the aggregate of all of the Fund's offering costs (other than sales loads)
exceeds $0.04 per share. Eaton Vance or an affiliate has agreed to reimburse all
Fund organizational costs.

<Table>
<Caption>
<S>                            <C>                               <C>
UBS INVESTMENT BANK                   MERRILL LYNCH & CO.                   WACHOVIA SECURITIES
A.G. EDWARDS                     H&R BLOCK FINANCIAL ADVISORS,     J.J.B. HILLIARD, W.L. LYONS,
                                             INC.                                          INC.
OPPENHEIMER & CO.                                                                 RAYMOND JAMES
RBC CAPITAL MARKETS                                                      WELLS FARGO SECURITIES
</Table>
<PAGE>

--------------------------------------------------------------------------------
(continued from previous page)

Under normal market conditions, the Fund intends to pursue its primary
investment objective principally by employing an options strategy of writing
(selling) covered call options on a substantial portion of its portfolio
securities.

The extent of option writing activity will depend upon market conditions and the
Adviser's ongoing assessment of the attractiveness of writing call options on
the Fund's stock holdings. Writing covered call options involves a tradeoff
between the option premiums received and reduced participation in potential
future stock price appreciation. Depending on the Adviser's evaluation, the Fund
may write covered call options on varying percentages of the Fund's common stock
holdings. The Fund seeks to generate current earnings from option writing
premiums and, to a lesser extent, from dividends on stocks held. The Fund's call
option-writing program will seek to achieve a high level of net option premiums,
while maintaining the potential for capital appreciation in each stock on which
options are written up to a defined target price for that stock determined by
the Adviser. The Adviser and Sub-Adviser believe that by coordinating their
activities they will be able to achieve the Fund's investment objectives. In
particular, the Adviser believes its active management style, which incorporates
a research-driven fundamental investment approach, complements the Sub-Adviser's
systematic option methodology, which utilizes a proprietary options analysis and
management system.

The Fund may in certain circumstances purchase put options on the Standard &
Poor's 500 Composite Stock Price Index, the S&P MidCap 400 Index, any other
broad-based securities index deemed suitable for this purpose, and/or on
individual stocks held in its portfolio or use other derivative instruments in
order to help protect against a decline in the value of its portfolio
securities.

EXCHANGE LISTING.  The Fund intends to apply for listing of its common shares on
the New York Stock Exchange under the symbol "EOS." Because the Fund is newly
organized, its common shares have no history of public trading. The shares of
closed-end management investment companies frequently trade at a discount from
their net asset value. The returns earned by holders of the Fund's common shares
("Common Shareholders") who purchase their shares in this offering and sell
their shares below net asset value will be reduced.

The Fund's net asset value and distribution rate will vary and may be affected
by numerous factors, including changes in stock prices, option premiums, market
interest rates, dividend rates and other factors. An investment in the Fund may
not be appropriate for all investors. There is no assurance that the Fund will
achieve its investment objectives.

This Prospectus sets forth concisely information you should know before
investing in the shares of the Fund. Please read and retain this Prospectus for
future reference. A Statement of Additional Information dated           , 2005,
has been filed with the Securities and Exchange Commission ("SEC") and can be
obtained without charge by calling 1-800-225-6265 or by writing to the Fund. A
table of contents to the Statement of Additional Information is located at page
49 of this Prospectus. This Prospectus incorporates by reference the entire
Statement of Additional Information. The Statement of Additional Information is
available along with other Fund-related materials: at the SEC's public reference
room in Washington, DC (call 1-202-942-8090 for information on the operation of
the reference room); from the EDGAR database on the SEC's internet site
(http://www.sec.gov); upon payment of copying fees by writing to the SEC's
public reference section, Washington, DC 20549-0102; or by electronic mail at
publicinfo@sec.gov. The Fund's address is The Eaton Vance Building, 255 State
Street, Boston, Massachusetts 02109 and its telephone number is 1-800-225-6265.

The Fund's shares do not represent a deposit or obligation of, and are not
guaranteed or endorsed by, any bank or other insured depository institution, and
are not federally insured by the Federal Deposit Insurance Corporation, the
Federal Reserve Board or any other government agency.

The underwriters named in the Prospectus may purchase up to        additional
shares from the Fund under certain circumstances.

The underwriters expect to deliver the shares to purchasers on or about
          , 2005.

You should rely only on the information contained or incorporated by reference
in this Prospectus. The Fund has not authorized anyone to provide you with
different information. The Fund is not making an offer of these securities in
any state where the offer is not permitted.

Until           , 2005 (25 days after the date of this Prospectus), all dealers
that buy, sell or trade the shares, whether or not participating in this
offering, may be required to deliver a Prospectus. This is in addition to the
dealers' obligation to deliver a Prospectus when acting as underwriters and with
respect to their unsold allotments or subscriptions.

--------------------------------------------------------------------------------
<PAGE>

TABLE OF CONTENTS
--------------------------------------------------------------------------------

<Table>
<S>                                     <C>
Prospectus summary....................    1
Summary of Fund expenses..............   12
The Fund..............................   13
Use of proceeds.......................   13
Investment objectives, policies and
  risks...............................   13
Management of the Fund................   30
Distributions.........................   33
Dividend reinvestment plan............   38
Description of capital structure......   39
Underwriting..........................   45
Shareholder Servicing Agent, custodian
  and transfer agent..................   48
Legal opinions........................   48
Reports to shareholders...............   48
Independent registered public
  accounting firm.....................   48
Additional information................   48
Table of contents for the Statement of
  Additional Information..............   49
The Fund's privacy policy.............   49
</Table>

--------------------------------------------------------------------------------
<PAGE>

PROSPECTUS SUMMARY

This is only a summary. This summary may not contain all of the information that
you should consider before investing in the Fund's common shares. You should
review the more detailed information contained in this Prospectus and in the
Statement of Additional Information, especially the information set forth under
the heading "Investment objectives, policies and risks."

THE FUND

Eaton Vance Enhanced Equity Income Fund II (the "Fund") is a newly organized,
diversified, closed-end management investment company. The Fund's primary
investment objective is to provide current income, with a secondary objective of
capital appreciation. Investments are based on Eaton Vance Management's ("Eaton
Vance" or the "Adviser") internal research and ongoing company analysis, which
is generally not available to individual investors. Rampart Investment
Management Company, Inc. ("Rampart" or the "Sub-Adviser") has been engaged as a
sub-adviser to provide Eaton Vance with advice on and execution of the Fund's
option writing strategy. An investment in the Fund may not be appropriate for
all investors. There is no assurance that the Fund will achieve its investment
objectives.

THE OFFERING

The Fund is offering      common shares of beneficial interest, par value $0.01
per share, through a group of underwriters (the "Underwriters") led by UBS
Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wachovia
Capital Markets, LLC. The common shares of beneficial interest are called
"Common Shares." The Underwriters have been granted an option by the Fund to
purchase up to           additional Common Shares solely to cover orders in
excess of           Common Shares. The initial public offering price is $20.00
per share. The minimum purchase in this offering is 100 Shares ($2,000). See
"Underwriting." Eaton Vance or an affiliate has agreed to (i) reimburse all
organizational costs and (ii) pay all offering costs (other than sales loads)
that exceed $0.04 per Common Share.

INVESTMENT OBJECTIVES AND POLICIES

The Fund's primary investment objective is to provide current income, with a
secondary objective of capital appreciation. The Fund will pursue its investment
objectives by investing primarily in a portfolio of mid- and
large-capitalization common stocks, seeking to invest primarily in companies
with above-average growth and financial strength. Under normal market
conditions, the Fund will seek to generate current earnings from option premiums
by selling covered call options on a substantial portion of its portfolio
securities. There can be no assurance that the Fund will achieve its investment
objectives.

Under normal market conditions, the Fund will invest at least 80% of its total
assets in common stocks. Normally, the Fund will invest primarily in common
stocks of mid- and large-capitalization issuers that meet the Fund's selection
criteria of above-average growth and financial strength. Initially, the Fund
expects to invest between 55% and 65% of its total assets in mid-capitalization
stocks and between 35% and 45% of its total assets in large-capitalization
stocks. Under normal market conditions, the Fund expects to invest in at least
75 securities, seeking to reduce the Fund's exposure to individual stock risks.
The Fund generally will invest in common stocks on which exchange traded call
options are currently available. The Fund will invest primarily in common stocks
of U.S. issuers, although the Fund may invest up to 25% of its total assets in
securities of foreign issuers, including American Depositary Receipts ("ADRs"),
Global Depositary Receipts ("GDRs") and European Depositary Receipts ("EDRs").

Eaton Vance generally considers mid-capitalization companies to be those
companies having market capitalizations within the range of capitalizations for
the S&P MidCap 400 Index ("S&P MidCap 400"). As of November 30, 2004, the median
market capitalization of companies in the S&P

                                                                               1
<PAGE>

MidCap 400 was approximately $2.2 billion. Eaton Vance generally considers
large-capitalization companies to be those companies having market
capitalizations equal to or greater than the median market capitalization of the
companies included in the Standard & Poor's 500 Composite Stock Price Index
("S&P 500"). As of October 31, 2004, the median capitalization of companies in
the S&P 500 was approximately $10.1 billion.

Under normal market conditions, the Fund intends to pursue its primary
investment objective principally by employing an options strategy of writing
(selling) covered call options on a substantial portion of its portfolio
securities. The extent of option writing activity will depend upon market
conditions and the Adviser's ongoing assessment of the attractiveness of writing
call options on the Fund's stock holdings. Writing covered call options involves
a tradeoff between the option premiums received and reduced participation in
potential future stock price appreciation. Depending on the Adviser's
evaluation, the Fund may write covered call options on varying percentages of
the Fund's common stock holdings. The Fund seeks to generate current earnings
from option writing premiums and, to a lesser extent, from dividends on stocks
held. The Fund may in certain circumstances purchase put options on the S&P 500,
the S&P MidCap 400, any other broad-based securities index deemed suitable for
this purpose, and/or on individual stocks held in its portfolio or use other
derivative instruments in order to help protect against a decline in the value
of its portfolio securities.

The Fund normally expects that its investments will be invested across a broad
range of industries and market sectors. The Fund may not invest 25% or more of
its total assets in the securities of issuers in any single industry or group of
industries.

INVESTMENT STRATEGY

A team of Eaton Vance investment professionals with extensive experience in
equity research and management is responsible for the overall management of the
Fund's investments. Rampart Investment Management Company, Inc. ("Rampart" or
the "Sub-Adviser") has been engaged as a sub-adviser to provide Eaton Vance with
advice on and execution of the Fund's option writing strategy. The Fund's
investments are actively managed, and securities and other investments may be
bought or sold on a daily basis.

The Adviser believes that a strategy combining active equity portfolio
management with a systematic program of covered call option writing can provide
potentially attractive long-term returns. The Adviser further believes that a
strategy of owning common stocks in conjunction with writing covered call
options on a substantial portion of the stocks held should generally provide
returns that are superior to simply owning the same stocks under three different
stock market scenarios: (1) down-trending equity markets; (2) flat market
conditions; and (3) moderately rising equity markets. In the Adviser's opinion,
only in more strongly rising equity markets would the stock-plus-covered calls
strategy generally be expected to underperform the stocks held. For these
purposes, the Adviser considers more strongly rising equity market conditions to
exist whenever the current annual rate of return for U.S. stocks materially
exceeds the long-term historical average of stock market returns. The Adviser
considers moderately rising equity market conditions to exist whenever current
annual returns on U.S. common stocks are positive, but not materially higher
than the long-term historical average of stock market returns.

The Adviser will employ its signature "growth at a reasonable price" investment
style. Investment decisions for the Fund will be made primarily on the basis of
fundamental research. The Eaton Vance portfolio managers will utilize
information provided by, and the expertise of, the Adviser's research staff in
making investment decisions. The Adviser believes that investments in companies
with above average growth and financial strength should provide attractive
opportunities for investment appreciation. The Adviser seeks to identify such
stocks by focusing, without limitation, on issuers with the following
characteristics: (1) sustainable competitive advantages, (2) predictable and
dependable cash flows, (3) high quality management teams and (4) solid balance
sheets. Many of these considerations are subjective. In addition to its careful
research based analysis in selecting investments

 2
<PAGE>

for the Fund, the Adviser will also place a strong emphasis on the ongoing
evaluation of portfolio holdings and the appropriate time and circumstances to
sell or reduce a holding. In this regard, the Adviser may sell a stock when it
believes it is fully valued, the fundamentals of the company deteriorate, the
stock's price falls below its acquisition cost, management fails to execute its
strategy or to pursue other more attractive investment opportunities, among
other reasons.

The Adviser and Sub-Adviser believe that by coordinating their activities, they
will be able to achieve the Fund's investment objectives. In particular, the
Adviser believes its active management style complements the Sub-Adviser's
systematic option methodology. The Fund's call option-writing program will seek
to achieve a high level of net option premiums, while maintaining the potential
for capital appreciation in each stock on which options are written up to a
defined target price for that stock determined by the Adviser. To achieve this
goal, Rampart utilizes proprietary options management and options trading
analytical tools (Rampart Options Management System (ROMS)). Eaton Vance
believes that a long-term investment approach and low core turnover of the
underlying portfolio can support an efficient options program. Transaction costs
associated with the Fund's options strategy will vary depending on market
circumstances and other factors. Although it is not possible to accurately
predict such costs because of this variability, the Adviser estimates that such
costs on an annualized basis may range from between 0.20% and 0.30% of the
Fund's total assets assuming the same offering size assumed for purposes of
presenting the information set forth under "Summary of Fund expenses." There can
be no certainty that upon changing market conditions such costs will fall within
this range.

The Fund expects initially to write primarily exchange-listed call options on
individual stocks held in the Fund's portfolio (rather than S&P 500, S&P MidCap
400, or other index options), primarily with shorter maturities (typically two
to six months until expiration) and primarily at exercise prices approximately
equal to or slightly above the current stock price when written. When an
option-writing program is established for a particular stock, options will
typically be written on a portion of the total stock position, which may allow
for upside potential. If the stock price increases, the Fund will normally look
to buy back the call options written and to sell new call options at higher
exercise prices (up to the target price determined by the Adviser) on a greater
number of shares. When a stock's price moves to or above its target price, the
Adviser will evaluate the stock and option-writing program and determine whether
to raise its target price and continue to hold the stock and write covered call
options or, alternatively, whether to deliver the stock in settlement of the
option position or otherwise exit the position by buying back the options
written and selling the stock. If the stock price declines, the Fund will
normally seek to buy back the call options written and to sell new call options
at lower exercise prices on fewer shares. The Fund will seek to execute option
rolls (as described above) such that the premium received from writing new
options generally exceeds the amounts paid to close the positions being
replaced. The Fund may also write covered call options with different
characteristics and managed differently than described in this paragraph.

In addition to the intended strategy of selling covered call options, the Fund
may invest up to 20% of its total assets in other derivative instruments
acquired for hedging, risk management and investment purposes (to gain exposure
to securities, securities markets, markets indices and/or currencies consistent
with its investment objectives and policies), provided that no more than 10% of
the Fund's total assets may be invested in such derivative instruments acquired
for non-hedging purposes. Among other derivative strategies, the Fund may
purchase put options on the S&P 500, the S&P MidCap 400, any other broad-based
securities index deemed suitable for this purpose, and/or on individual stocks
held in its portfolio or use other derivative instruments in order to help
protect against a decline in the value of its portfolio securities. Derivative
instruments may be used by the Fund to enhance returns or as a substitute for
the purchase or sale of securities.

The foregoing policies relating to investment in common stocks and options
writing are the Fund's primary investment policies. In addition to its primary
investment policies, the Fund may invest to a limited extent in other types of
securities and engage in certain other investment practices.

                                                                               3
<PAGE>

LISTING

The Fund intends to apply for listing of its Common Shares on the New York Stock
Exchange under the symbol "EOS."

INVESTMENT ADVISER, ADMINISTRATOR AND SUB-ADVISER

Eaton Vance, a direct wholly-owned subsidiary of Eaton Vance Corp., is the
Fund's investment adviser and administrator. The Adviser and its subsidiaries
managed approximately $94.5 billion on behalf of funds, institutional clients
and individuals as of October 31, 2004, including approximately $55.8 billion in
equity assets. Twenty-nine of the funds managed by Eaton Vance are closed-end
funds. Eaton Vance has engaged Rampart as a sub-adviser to provide advice on and
execution of the Fund's options strategy. Rampart, founded in 1983, specializes
in option management and trading for institutional and high net worth investors.
Rampart managed approximately $1.8 billion in assets as of November 30, 2004.
See "Management of the Fund."

DISTRIBUTIONS

Commencing with the Fund's first distribution, the Fund intends to make regular
monthly distributions to Common Shareholders based upon the Fund's projected
annual cash available from option premiums and dividends. For distribution
purposes, "cash available from option premiums and dividends" will consist of
the total proceeds of options sales plus dividends and interest received, less
amounts paid to purchase options and Fund expenses. The Fund's distribution rate
may be adjusted from time-to-time. The Board may modify this distribution policy
at any time without obtaining the approval of Common Shareholders. The initial
distribution is expected to be declared approximately 45-60 days and paid
approximately 60-90 days after the completion of this offering, depending on
market conditions.

The Fund's annual cash available from options premiums and dividends will likely
differ from annual net investment income. The investment income of the Fund will
consist of all dividend and interest income accrued on portfolio investments,
short-term capital gain (including short-term gains on terminated option
positions and gains on the sale of portfolio investments held for one year or
less) in excess of long-term capital loss and income from certain hedging
transactions, less all expenses of the Fund. Expenses of the Fund will be
accrued each day. The Fund expects that over time it will distribute all of its
investment company taxable income. In addition, at least annually, the Fund
intends to distribute any net capital gain (which is the excess of net long-term
capital gain over net short-term capital loss). To the extent that that Fund's
net investment income and net capital gain for any taxable year exceed the total
monthly distributions paid during the year, the Fund will make a special
distribution at or near year-end of such excess amount as may be required to
maintain its qualification as a regulated investment company or to avoid income
and excise taxes. If the Fund's total monthly distributions in any taxable year
exceed the amount of its current and accumulated earnings and profits for the
year, any such excess would be characterized as a return of capital. Under the
1940 Act, for any distribution that includes amounts from sources other than net
income, the Fund is required to provide Common Shareholders a written statement
regarding the components of such distribution.

To permit the Fund to maintain more stable distributions, distribution rates
will be based on projected annual cash available from options premiums and
dividends. As a result, the distributions paid by the Fund for any particular
month may be more or less than the amount of cash available from options
premiums and dividends for that month. In such circumstances, the Fund may have
to sell a portion of its investment portfolio to make a distribution at a time
when independent investment judgment might not dictate such action.
Undistributed net investment income is included in the Common Shares' net asset
value, and, correspondingly, distributions from net investment income will
reduce the Common Shares' net asset value.

 4
<PAGE>

Common Shareholders may elect automatically to reinvest some or all of their
distributions in additional Common Shares under the Fund's dividend reinvestment
plan. See "Distributions" and "Dividend reinvestment plan."

DIVIDEND REINVESTMENT PLAN

The Fund has established a dividend reinvestment plan (the "Plan"). Under the
Plan, a Common Shareholder may elect to have all distributions automatically
reinvested in additional Common Shares either purchased in the open market or
newly issued by the Fund if the Common Shares are trading at or above their net
asset value. Common Shareholders may elect to participate in the Plan by
completing the dividend reinvestment plan application form. Common Shareholders
who do not elect to participate in the Plan will receive all distributions in
cash paid by check mailed directly to them by PFPC Inc., as dividend paying
agent. Common Shareholders who intend to hold their Common Shares through a
broker or nominee should contact such broker or nominee to determine whether or
how they may participate in the Plan. See "Dividend reinvestment plan."

CLOSED-END STRUCTURE

Closed-end funds differ from open-end management investment companies (commonly
referred to as mutual funds) in that closed-end funds generally list their
shares for trading on a securities exchange and do not redeem their shares at
the option of the shareholder. By comparison, mutual funds issue securities that
are redeemable at net asset value at the option of the shareholder and typically
engage in a continuous offering of their shares. Mutual funds are subject to
continuous asset in-flows and out-flows that can complicate portfolio
management, whereas closed-end funds generally can stay more fully invested in
securities consistent with the closed-end fund's investment objectives and
policies.

In addition, in comparison to open-end funds, closed-end funds have greater
flexibility in the employment of financial leverage, and in the ability to make
certain types of investments. Shares of closed-end funds listed on an exchange
may be purchased and sold throughout each trading day, whereas purchases and
sales of mutual funds are generally effected as of the close of market trading.
However, shares of closed-end funds frequently trade at a discount from their
net asset value.

In recognition of the possibility that the Common Shares might trade at a
discount to net asset value and that any such discount may not be in the
interest of Common Shareholders, the Fund's Board of Trustees (the "Board"), in
consultation with Eaton Vance, from time to time may review possible actions to
reduce any such discount. The Board might consider open market repurchases or
tender offers for Common Shares at net asset value. There can be no assurance
that the Board will decide to undertake any of these actions or that, if
undertaken, such actions would result in the Common Shares trading at a price
equal to or close to net asset value per Common Share. The Board might also
consider the conversion of the Fund to an open-end mutual fund. The Board
believes, however, that the closed-end structure is desirable, given the Fund's
investment objectives and policies. Investors should assume, therefore, that it
is highly unlikely that the Board would vote to convert the Fund to an open-end
investment company.

Although the Fund has no current intention to issue preferred shares, investors
should note that any possible future issuance of preferred shares to provide
investment leverage could make a conversion to open-end form more difficult
because of the voting rights of preferred shareholders, the costs of redeeming
preferred shares and other factors. See "Description of capital structure."

SPECIAL RISK CONSIDERATIONS

NO OPERATING HISTORY
The Fund is a closed-end investment company with no history of operations and is
designed for long-term investors and not as a trading vehicle.

                                                                               5
<PAGE>

INVESTMENT AND MARKET RISK
An investment in Common Shares is subject to investment risk, including the
possible loss of the entire principal amount invested. An investment in Common
Shares represents an indirect investment in the securities owned by the Fund,
which are generally traded on a securities exchange or in the over-the-counter
markets. The value of these securities, like other market investments, may move
up or down, sometimes rapidly and unpredictably. In addition, by writing
(selling) call options on the equity securities held in the Fund's portfolio,
the capital appreciation potential of such securities will be limited to the
difference between the exercise price of the call options written and the
purchase price of the equity security underlying such options. The Common Shares
at any point in time may be worth less than the original investment, even after
taking into account any reinvestment of distributions.

ISSUER RISK
The value of securities held by the Fund may decline for a number of reasons
that directly relate to the issuer, such as management performance, financial
leverage and reduced demand for the issuer's goods and services.

EQUITY RISK
At least 80% of the Fund's total assets will be invested in common stocks and
therefore a principal risk of investing in the Fund is equity risk. Equity risk
is the risk that securities held by the Fund will fall due to general market or
economic conditions, perceptions regarding the industries in which the issuers
of securities held by the Fund participate, and the particular circumstances and
performance of particular companies whose securities the Fund holds. Although
common stocks have historically generated higher average returns than
fixed-income securities over the long term, common stocks also have experienced
significantly more volatility in returns. An adverse event, such as an
unfavorable earnings report, may depress the value of equity securities of an
issuer held by the Fund; the price of common stock of an issuer may be
particularly sensitive to general movements in the stock market; or a drop in
the stock market may depress the price of most or all of the common stocks and
other equity securities held by the Fund. In addition, common stock of an issuer
in the Fund's portfolio may decline in price if the issuer fails to make
anticipated dividend payments because, among other reasons, the issuer of the
security experiences a decline in its financial condition. Common equity
securities in which the Fund will invest are structurally subordinated to
preferred stocks, bonds and other debt instruments in a company's capital
structure, in terms of priority to corporate income, and therefore will be
subject to greater dividend risk than preferred stocks or debt instruments of
such issuers. Finally, common stock prices may be sensitive to rising interest
rates, as the costs of capital rise and borrowing costs increase.

RISKS ASSOCIATED WITH OPTIONS ON SECURITIES
There are numerous risks associated with transactions in options on securities.
A decision as to whether, when and how to use options involves the exercise of
skill and judgment, and even a well-conceived transaction may be unsuccessful to
some degree because of market behavior or unexpected events. As the writer of a
covered call option, the Fund forgoes, during the option's life, the opportunity
to profit from increases in the market value of the security covering the call
option above the sum of the option premium received and the exercise price of
the call, but has retained the risk of loss, minus the option premium received,
should the price of the underlying security decline. The writer of an option has
no control over when during the exercise period of the option it may be required
to fulfill its obligation as a writer of the option. Once an option writer has
received an exercise notice, it cannot effect a closing purchase transaction in
order to terminate its obligation under the option and must deliver the
underlying security at the exercise price. Thus, the use of options may require
the Fund to sell portfolio securities at inopportune times or for prices other
than current market values, will limit the amount of appreciation the Fund can
realize above the exercise price of an option on a common stock, or may cause
the Fund to hold a security that it might otherwise sell.

 6
<PAGE>

The value of options may also be adversely affected if the market for such
options becomes less liquid or smaller. There can be no assurance that a liquid
market will exist when the Fund seeks to close out an option position either, in
the case of a call option written, by buying the option, or, in the case of a
purchased put option, by selling the option. Reasons for the absence of a liquid
secondary market on an exchange include the following: (i) there may be
insufficient trading interest in certain options; (ii) restrictions may be
imposed by an exchange on opening transactions or closing transactions or both;
(iii) trading halts, suspensions or other restrictions may be imposed with
respect to particular classes or series of options; (iv) unusual or unforeseen
circumstances may interrupt normal operations on an exchange; (v) the facilities
of an exchange or the Options Clearing Corporation (the "OCC") may not at all
times be adequate to handle current trading volume; or (vi) one or more
exchanges could, for economic or other reasons, decide or be compelled to
discontinue the trading of options (or a particular class or series of options)
at some future date. If trading were discontinued, the secondary market on that
exchange (or in that class or series of options) would cease to exist. However,
outstanding options on that exchange that had been issued by the OCC as a result
of trades on that exchange would continue to be exercisable in accordance with
their terms. The Fund's ability to terminate over-the-counter options will be
more limited than with exchange-traded options and may involve the risk that
broker-dealers participating in such transactions will not fulfill their
obligations. If the Fund were unable to close out a covered call option that it
had written on a security, it would not be able to sell the underlying security
unless the option expired without exercise.

The hours of trading for options may not conform to the hours during which the
underlying securities are traded. To the extent that the options markets close
before the markets for the underlying securities, significant price and rate
movements can take place in the underlying markets that would not be reflected
concurrently in the options markets. Call options are marked to market daily and
their value will be affected by changes in the value of and dividend rates of
the underlying common stocks, changes in interest rates, changes in the actual
or perceived volatility of the stock market and the underlying common stocks and
the remaining time to the options' expiration. Additionally, the exercise price
of an option may be adjusted downward before the option's expiration as a result
of the occurrence of certain corporate events affecting the underlying equity
security, such as extraordinary dividends, stock splits, merger or other
extraordinary distributions or events. A reduction in the exercise price of an
option would reduce the Fund's capital appreciation potential on the underlying
security.

The number of call options the Fund can write is limited by the number of shares
of common stock the Fund holds, and further limited by the fact that listed call
options on individual common stocks generally trade in units representing 100
shares of the underlying stock. Furthermore, the Fund's options transactions
will be subject to limitations established by each of the exchanges, boards of
trade or other trading facilities on which such options are traded. These
limitations govern the maximum number of options in each class which may be
written or purchased by a single investor or group of investors acting in
concert, regardless of whether the options are written or purchased on the same
or different exchanges, boards of trade or other trading facilities or are held
or written in one or more accounts or through one or more brokers. Thus, the
number of options which the Fund may write or purchase may be affected by
options written or purchased by other investment advisory clients of the Adviser
or Sub-Adviser. An exchange, board of trade or other trading facility may order
the liquidation of positions found to be in excess of these limits, and may
impose certain other sanctions. The Fund will not write "naked" or uncovered
call options.

If the Fund purchases put options for hedging or risk management purposes, the
Fund will be subject to the following additional risks. A put option acquired by
the Fund and not sold prior to expiration will expire worthless if the price of
the stock or index at expiration exceeds the exercise price of the option,
thereby causing the Fund to lose its entire investment in the option. If
restrictions on exercise were imposed, the Fund might be unable to exercise an
option it had purchased. If the Fund were unable to close out an option that it
had purchased, it would have to exercise the option in order to realize any
profit or the option may expire worthless. Stock market indices on which the
Fund may

                                                                               7
<PAGE>

purchase options positions likely will not mirror the Fund's actual portfolio
holdings. The effectiveness of index put options as hedges against declines in
the Fund's stock portfolio will be limited to the extent that the performance of
the underlying index does not correlate with that of the Fund's holdings.

RISKS OF MID-CAP COMPANIES
The Fund may invest substantially in companies whose market capitalization is
considered middle sized or "mid-cap." Mid-cap companies often are newer or less
established companies than larger companies. Investments in mid-cap companies
carry additional risks because earnings of these companies tend to be less
predictable; they often have limited product lines, markets, distribution
channels or financial resources; and the management of such companies may be
dependent upon one or a few key people. The market movements of equity
securities of mid-cap companies may be more abrupt or erratic than the market
movements of equity securities of larger, more established companies or the
stock market in general. Historically, mid-cap companies have sometimes gone
through extended periods when they did not perform as well as larger companies.
In addition, equity securities of mid-cap companies generally are less liquid
than those of larger companies. This means that the Fund could have greater
difficulty selling such securities at the time and price that the Fund would
like.

RISKS OF GROWTH STOCK INVESTING
The Fund expects to invest substantially in stocks with "growth"
characteristics. Growth stocks can react differently to issuer, political,
market, and economic developments than the market as a whole and other types of
stocks. Growth stocks tend to be more expensive relative to their earnings or
assets compared to other types of stocks. As a result, growth stocks tend to be
sensitive to changes in their earnings and more volatile than other types of
stocks.

DISTRIBUTION RISK
The monthly distributions Common Shareholders receive from the Fund will be
based primarily on the level of net option premiums and the dividends received
by the Fund. Net option premiums and dividend payments the Fund receives in
respect of its portfolio securities can vary widely over the short- and
long-term. If stock prices or stock price volatility declines, the level of
premiums from options writing and the amounts available for distribution from
options activity will likely decrease as well. Payments to purchase put options
and to close written call options will reduce amounts available for distribution
from call option premiums received and proceeds of closing put options.
Dividends on common stocks are not fixed but are declared at the discretion of
the issuer's board of directors. There is no guarantee that the issuers of
common stocks in which the Fund invests will declare dividends in the future or
that if declared they will remain at current levels or increase over time.
Dividends on any preferred stocks in which the Fund may invest are not
guaranteed and certain issues of preferred stock held by the Fund may be called
by the issuer.

FOREIGN SECURITY RISK
The Fund may have substantial exposure to foreign securities. The value of
foreign securities is affected by changes in currency rates, foreign tax laws
(including withholding tax), government policies (in this country or abroad),
relations between nations and trading, settlement, custodial and other
operational risks. In addition, the costs of investing abroad are generally
higher than in the United States, and foreign securities markets may be less
liquid, more volatile and less subject to governmental supervision than markets
in the United States. Foreign investments also could be affected by other
factors not present in the United States, including expropriation, armed
conflict, confiscatory taxation, lack of uniform accounting and auditing
standards, less publicly available financial and other information and potential
difficulties in enforcing contractual obligations. As an alternative to holding
foreign-traded securities, the Fund may invest in dollar-denominated securities
of foreign companies that trade on U.S. exchanges or in the U.S.
over-the-counter market (including depositary receipts, which evidence ownership
in underlying foreign securities). Since the Fund may invest in securities

 8
<PAGE>

denominated or quoted in currencies other than the U.S. dollar, the Fund will be
affected by changes in foreign currency exchange rates (and exchange control
regulations) which affect the value of investments in the Fund and the accrued
income and appreciation or depreciation of the investments in U.S. dollars.
Changes in foreign currency exchange rates relative to the U.S. dollar will
affect the U.S. dollar value of the Fund's assets denominated in that currency
and the Fund's return on such assets as well as any temporary uninvested
reserves in bank deposits in foreign currencies. In addition, the Fund will
incur costs in connection with conversions between various currencies.

Because foreign companies are not subject to uniform accounting, auditing and
financial reporting standards, practices and requirements comparable to those
applicable to U.S. companies, there may be less publicly available information
about a foreign company than about a domestic company. Volume and liquidity in
most foreign debt markets are less than in the United States and securities of
some foreign companies are less liquid and more volatile than securities of
comparable U.S. companies. There is generally less government supervision and
regulation of securities exchanges, broker-dealers and listed companies than in
the United States. Mail service between the United States and foreign countries
may be slower or less reliable than within the United States, thus increasing
the risk of delayed settlements of portfolio transactions for, or loss of
certificates of, portfolio securities. Payment for securities before delivery
may be required. In addition, with respect to certain foreign countries, there
is the possibility of expropriation or confiscatory taxation, political or
social instability, or diplomatic developments, which could affect investments
in those countries. Moreover, individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such respects as growth of gross
national product, rate of inflation, capital reinvestment, resource
self-sufficiency and balance of payments position. Foreign securities markets,
while growing in volume and sophistication, are generally not as developed as
those in the United States, and securities of some foreign issuers (particularly
those located in developing countries) may be less liquid and more volatile than
securities of comparable U.S. companies.

INTEREST RATE RISK
The level of premiums from call options writing and the amounts available for
distribution from the Fund's options activity may decrease in declining interest
rate environments. Any preferred stocks paying fixed dividend rates in which the
Fund invests, will likely change in value as market interest rates change. When
interest rates rise, the market value of such securities generally will fall. To
the extent that the Fund invests in preferred stocks, the net asset value and
price of the Common Shares may decline if market interest rates rise. Interest
rates are currently low relative to historic levels. During periods of declining
interest rates, an issuer of preferred stock may exercise its option to redeem
securities prior to maturity, forcing the Fund to reinvest in lower yielding
securities. This is known as call risk. During periods of rising interest rates,
the average life of certain types of securities may be extended because of
slower than expected payments. This may lock in a below market yield, increase
the security's duration, and reduce the value of the security. This is known as
extension risk. The value of the Fund's common stock investments may also be
influenced by changes in interest rates.

SECTOR RISK
The Fund may invest a significant portion of its assets in securities of issuers
in any single industry or sector of the economy (a broad based economic segment
that may include many distinct industries) if companies in that industry or
sector meet the Fund's investment criteria. If the Fund is focused in an
industry or sector, it may present more risks than if it were broadly
diversified over numerous industries or sectors of the economy. This may make
the Fund more susceptible to adverse economic, political, or regulatory
occurrences affecting these sectors. A "sector" is a broader economic segment
that may include many different industries. As the percentage of the Fund's
assets invested in a particular sector increases, so does the potential for
fluctuation in the net asset value of Common Shares. The Fund may not invest 25%
or more of its total assets in the securities of issuers in any single industry
or group of industries.

                                                                               9
<PAGE>

DERIVATIVES RISK
In addition to writing covered call options, the risks of which are described
above, the Fund may invest up to 20% of its total assets in other derivative
investments acquired for hedging, risk management and investment purposes.
Derivative transactions including options on securities and securities indices
and other transactions in which the Fund may engage (such as futures contracts
and options thereon, swaps and short sales) may subject the Fund to increased
risk of principal loss due to unexpected movements in stock prices, changes in
stock volatility levels and interest rates, and imperfect correlations between
the Fund's securities holdings and indices upon which derivative transactions
are based. The Fund also will be subject to credit risk with respect to the
counterparties to any over-the-counter derivatives contracts purchased by the
Fund. If a counterparty becomes bankrupt or otherwise fails to perform its
obligations under a derivative contract due to financial difficulties, the Fund
may experience significant delays in obtaining any recovery under the derivative
contract in a bankruptcy or other reorganization proceeding. The Fund may obtain
only a limited recovery or may obtain no recovery in such circumstances.

LIQUIDITY RISK
The Fund may invest up to 15% of its total assets in securities for which there
is no readily available trading market or which are otherwise illiquid. The Fund
may not be able readily to dispose of such securities at prices that approximate
those at which the Fund could sell such securities if they were more widely
traded and, as a result of such illiquidity, the Fund may have to sell other
investments or engage in borrowing transactions if necessary to raise cash to
meet its obligations. In addition, the limited liquidity could affect the market
price of the securities, thereby adversely affecting the Fund's net asset value.

INFLATION RISK
Inflation risk is the risk that the purchasing power of assets or income from
investment will be worth less in the future as inflation decreases the value of
money. As inflation increases, the real value of the Common Shares and
distributions thereon can decline.

MARKET PRICE OF COMMON SHARES
The shares of closed-end management investment companies often trade at a
discount from their net asset value, and the Fund's Common Shares may likewise
trade at a discount from net asset value. The trading price of the Fund's Common
Shares may be less than the public offering price. The returns earned by Common
Shareholders who purchased their Common Shares in this offering and sell their
Common Shares below net asset value will be reduced.

FINANCIAL LEVERAGE
Although the Fund has no current intention to do so, the Fund is authorized to
utilize leverage through the issuance of preferred shares and/or borrowings,
including the issuance of debt securities. In the event that the Fund determines
in the future to utilize investment leverage, there can be no assurance that
such a leveraging strategy will be successful during any period in which it is
employed. Leverage creates risks for Common Shareholders, including the
likelihood of greater volatility of net asset value and market price of the
Common Shares and the risk that fluctuations in distribution rates on any
preferred shares or fluctuations in borrowing costs may affect the return to
Common Shareholders. To the extent the income derived from securities purchased
with proceeds received from leverage exceeds the cost of leverage, the Fund's
distributions will be greater than if leverage had not been used. Conversely, if
the income from the securities purchased with such proceeds is not sufficient to
cover the cost of leverage, the amount available for distribution to Common
Shareholders will be less than if leverage had not been used. In the latter
case, Eaton Vance, in its best judgment, may nevertheless determine to maintain
the Fund's leveraged position if it deems such action to be appropriate. The
costs of an offering of preferred shares and/or a borrowing program would be
borne by Common Shareholders and consequently would result in a reduction of the
net asset value of Common Shares. In addition, the fee paid to Eaton Vance will
be calculated on the basis of the Fund's

 10
<PAGE>

average daily gross assets, including proceeds from the issuance of preferred
shares and/or borrowings, so the fees will be higher when leverage is utilized.
In this regard, holders of preferred shares do not bear the investment advisory
fee. Rather, Common Shareholders bear the portion of the investment advisory fee
attributable to the assets purchased with the proceeds of the preferred shares
offering.

MANAGEMENT RISK
The Fund is subject to management risk because it is an actively managed
portfolio. Eaton Vance, Rampart and the individual portfolio managers will apply
investment techniques and risk analyses in making investment decisions for the
Fund, but there can be no guarantee that these will produce the desired results.
The Fund may be subject to additional management risk because the Fund's options
program will require effective coordination between the Adviser and the
Sub-Adviser.

MARKET DISRUPTION
The terrorist attacks in the United States on September 11, 2001 had a
disruptive effect on the securities markets. These terrorist attacks and related
events, including the war in Iraq, its aftermath, and continuing occupation of
Iraq by coalition forces, have raised short-term market risk and may have
adverse long-term effects on U.S. and world economies and markets. A similar
disruption of the financial markets could impact trading in common stocks and
stock options, interest rates, credit risk, inflation and other factors relating
to the Common Shares. The Fund cannot predict the effects of similar events in
the future on the U.S. economy and securities markets.

ANTI-TAKEOVER PROVISIONS
The Fund's Agreement and Declaration of Trust includes provisions that could
have the effect of limiting the ability of other persons or entities to acquire
control of the Fund or to change the composition of its Board. See "Description
of capital structure--Anti-takeover provisions in the Declaration of Trust."

                                                                              11
<PAGE>

Summary of Fund expenses

The purpose of the table below is to help you understand all fees and expenses
that you, as a Common Shareholder, would bear directly or indirectly.

<Table>
<S>                                                           <C>
Shareholder transaction expenses
  Sales load paid by you (as a percentage of offering
     price).................................................  4.50%
  Expenses borne by the Fund................................  0.20%(1)
  Dividend reinvestment plan fees...........................   None(2)
</Table>

<Table>
<Caption>
                                                               PERCENTAGE OF NET ASSETS
                                                                     ATTRIBUTABLE
                                                                   TO COMMON SHARES
---------------------------------------------------------------------------------------
<S>                                                            <C>
Annual expenses
  Management fees...........................................             1.00%
  Other expenses............................................             0.20%(3)
                                                                         ----
  Total annual expenses.....................................             1.20%
                                                                         ====
</Table>

------------
(1) Eaton Vance or an affiliate has agreed to reimburse all organizational costs
    and pay all offering costs (other than sales loads) that exceed $0.04 per
    Common Share (0.20% of the offering price).

(2) You will be charged a $5.00 service charge and pay brokerage charges if you
    direct the plan agent to sell your Common Shares held in a dividend
    reinvestment account.

(3) Estimated expenses based on the current fiscal year.

The expenses shown in the table are based on estimated amounts for the Fund's
first year of operations and assume that the Fund issues approximately
12,500,000 Common Shares. See "Management of the Fund" and "Dividend
reinvestment plan."

EXAMPLE

The following example illustrates the expenses that you would pay on a $1,000
investment in Common Shares (including the sales load of $45, estimated offering
expenses of this offering of $2), assuming (1) total annual expenses of 1.20% of
net assets attributable to Common Shares and (2) a 5% annual return(1):

<Table>
<Caption>
1 YEAR   3 YEARS   5 YEARS   10 YEARS
-------------------------------------
<S>      <C>       <C>       <C>
$59        $83      $110       $186
</Table>

THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF FUTURE EXPENSES. ACTUAL
EXPENSES MAY BE HIGHER OR LOWER.
------------
(1) The example assumes that the estimated Other expenses set forth in the
    Annual expenses table are accurate, and that all dividends and distributions
    are reinvested at net asset value. Actual expenses may be greater or less
    than those assumed. Moreover, the Fund's actual rate of return may be
    greater or less than the hypothetical 5% return shown in the example.

 12
<PAGE>

--------------------------------------------------------------------------------

The Fund

Eaton Vance Enhanced Equity Income Fund II (the "Fund") is a newly organized,
diversified, closed-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act" or the "Investment
Company Act"). The Fund was organized as a Massachusetts business trust on
November 8, 2004 pursuant to a Declaration of Trust governed by the laws of The
Commonwealth of Massachusetts and has no operating history. The Fund's principal
office is located at The Eaton Vance Building, 255 State Street, Boston,
Massachusetts 02109, and its telephone number is 1-800-225-6265.

This Prospectus relates to the initial public offering of the Fund's common
shares of beneficial interest, $0.01 par value (the "Common Shares"). See
"Underwriting."

Use of proceeds

The net proceeds of this offering of Common Shares will be approximately $
(or $     assuming exercise of the Underwriters' over-allotment option in full),
which, after payment of the estimated offering expenses, will be invested in
accordance with the Fund's investment objectives and policies as soon as
practicable, but, in no event, under normal market conditions, later than three
months after the receipt thereof. Pending such investment, the proceeds may be
invested in high-quality, short-term debt securities, cash and/or cash
equivalents. Eaton Vance or an affiliate has agreed to (i) reimburse all
organizational costs and (ii) pay all offering costs of the Fund (other than
sales loads) that exceed $0.04 per Common Share.

Investment objectives, policies and risks

INVESTMENT OBJECTIVES

The Fund's primary investment objective is to provide current income, with a
secondary objective of capital appreciation. The Fund will pursue its investment
objectives by investing primarily in a portfolio of mid- and
large-capitalization common stocks, seeking to invest primarily in companies
with above-average growth and financial strength. Under normal market
conditions, the Fund will seek to generate current earnings from option premiums
by selling covered call options on a substantial portion of its portfolio
securities. There can be no assurance that the Fund will achieve its investment
objectives.

PRIMARY INVESTMENT POLICIES

GENERAL COMPOSITION OF THE FUND
Under normal market conditions, the Fund will invest at least 80% of its total
assets in common stocks. Normally, the Fund will invest primarily in common
stocks of mid- and large-capitalization issuers that meet the Fund's selection
criteria of above-average growth and financial strength. Initially, the Fund
expects to invest between 55% and 65% of its total assets in mid-capitalization
stocks and between 35% and 45% of its total assets in large-capitalization
stocks. Under normal market conditions, the Fund expects to invest in at least
75 securities, seeking to reduce the Fund's exposure to individual stock risks.
The Fund generally will invest in common stocks on which exchange traded call
options are currently available. The Fund will invest primarily in common stocks
of U.S. issuers, although the Fund may invest up to 25% of its total assets in
securities of foreign issuers, including

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American Depositary Receipts ("ADRs"), Global Depositary Receipts ("GDRs") and
European Depositary Receipts ("EDRs").

Eaton Vance generally considers mid-capitalization companies to be those
companies having market capitalizations within the range of capitalizations for
the S&P MidCap 400 Index ("S&P MidCap 400"). As of November 30, 2004, the median
market capitalization of companies in the S&P MidCap 400 was approximately $2.2
billion. Eaton Vance generally considers large-capitalization companies to be
those companies having market capitalizations equal to or greater than the
median capitalization of the companies included in the Standard & Poor's 500
Composite Stock Price Index ("S&P 500"). As of October 31, 2004, the median
market capitalization of companies in the S&P 500 was approximately $10.1
billion.

The Fund's policy of investing, under normal market circumstances, at least 80%
of its total assets in common stocks is not considered to be fundamental by the
Fund and can be changed without a vote of the Fund's shareholders. However, this
policy may only be changed by the Fund's Board of Trustees (the "Board")
following the provision of 60 days prior written notice to the Fund's
shareholders.

Under normal market conditions, the Fund intends to pursue its primary
investment objective principally by employing an options strategy of writing
(selling) covered call options on a substantial portion of its portfolio
securities. The extent of option writing activity will depend upon market
conditions and the Adviser's ongoing assessment of the attractiveness of writing
call options on the Fund's stock holdings. Writing covered call options involves
a tradeoff between the option premiums received and reduced participation in
potential future stock price appreciation. Depending on the Adviser's
evaluation, the Fund may write covered call options on varying percentages of
the Fund's common stock holdings. The Fund seeks to generate current earnings
from option writing premiums and, to a lesser extent, from dividends on stocks
held.

The Fund may in certain circumstances purchase put options on the S&P 500, S&P
MidCap 400, any other broad-based securities index deemed suitable for this
purpose, and/or on individual stocks held in its portfolio or use other
derivative instruments in order to help protect against a decline in the value
of its portfolio securities. The premiums paid to acquire any such put options
will reduce the amounts available for distribution to Common Shareholders from
options activities.

The Fund normally expects that its investments will be invested across a broad
range of industries and market sectors. The Fund may, however, invest up to any
amount less than 25% of its total assets in the securities of issuers in any
single industry or group of industries. See "Risk considerations--Sector risk."

INVESTMENT STRATEGY
A team of Eaton Vance investment professionals with extensive experience in
equity research and management is responsible for the overall management of the
Fund's investments. Rampart Investment Management Company, Inc. ("Rampart" or
the "Sub-Adviser") has been engaged as a sub-adviser to provide the Fund with
advice on and execution of its option writing strategy. The Fund's investments
are actively managed, and securities and other investments may be bought or sold
on a daily basis.

The Adviser believes that a strategy combining active equity portfolio
management with a systematic program of covered call option writing can provide
potentially attractive long-term returns. The Adviser further believes that a
strategy of owning common stocks in conjunction with writing covered call
options on a substantial portion of the stocks held should generally provide
returns that are superior to simply owning the same stocks under three different
stock market scenarios: (1) Down-trending equity markets; (2) flat market
conditions; and (3) moderately rising equity markets. In the Adviser's opinion,
only in more strongly rising equity markets would the stock-plus-covered calls
strategy generally be expected to underperform the stocks held. For these
purposes, the Adviser

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considers more strongly rising equity market conditions to exist whenever the
current annual rate of return for U.S. stocks materially exceeds the long-term
historical average of stock market returns. The Adviser considers moderately
rising equity market conditions to exist whenever current annual returns on U.S.
common stocks are positive, but not materially higher than the long-term
historical average of stock market returns.

The Adviser will employ its signature "growth at a reasonable price" investment
style. Investment decisions for the Fund will be made primarily on the basis of
fundamental research. The Eaton Vance portfolio managers will utilize
information provided by, and the expertise of, the Adviser's research staff in
making investment decisions. The Adviser believes that investments in companies
with above average growth and financial strength should provide attractive
opportunities for investment appreciation. The Adviser seeks to identify such
stocks by focusing, without limitation, on issuers with the following
characteristics: (1) sustainable competitive advantages, (2) predictable and
dependable cash flows, (3) high quality management teams and (4) solid balance
sheets. Many of these considerations are subjective. In addition to its careful
research based analysis in selecting investments for the Fund, the Adviser also
places a strong emphasis on the ongoing evaluation of portfolio holdings and the
appropriate time and circumstances to sell or reduce a holding. In this regard,
the Adviser may sell a stock when it believes it is fully valued, the
fundamentals of a company deteriorate, a stock's price falls below its
acquisition cost, management fails to execute its strategy or to pursue other
more attractive investment opportunities, among other reasons.

The Adviser and Sub-Adviser believe that by coordinating their activities, they
will be able to achieve the Fund's investment objectives. In particular, the
Adviser believes its active management style complements the Sub-Adviser's
systematic option methodology. The Fund's call option-writing program will seek
to achieve a high level of net option premiums, while maintaining the potential
for capital appreciation in each stock on which options are written up to a
defined target price for that stock determined by the Adviser. To achieve this
goal, Rampart utilizes proprietary options management and options trading
analytical tools (Rampart Options Management System (ROMS)). Eaton Vance
believes that a long-term investment approach and low core turnover of the
underlying portfolio can support an efficient options program. Transaction costs
associated with the Fund's options strategy will vary depending on market
circumstances and other factors. Although it is not possible to accurately
predict such costs because of this variability, the Adviser estimates that such
costs on an annualized basis may range from between 0.20% and 0.30% of the
Fund's total assets assuming the same offering size assumed for purposes of
presenting the information set forth under "Summary of Fund expenses." There can
be no certainty that upon changing market conditions such costs will fall within
this range.

The Fund expects initially to write primarily exchange-listed call options on
individual stocks held in the Fund's portfolio (rather than S&P 500, S&P MidCap
400 or other index options), primarily with shorter maturities (typically two to
six months until expiration) and primarily at exercise prices approximately
equal to or slightly above the current stock price when written. When an
option-writing program is established for a particular stock, options will
typically be written on a portion of the total stock position, which may allow
for upside potential. If the stock price increases, the Fund will normally look
to buy back the call options written and to sell new call options at higher
exercise prices (up to the target price determined by the Adviser) on a greater
number of shares. When a stock's price moves to or above its target price, the
Adviser will evaluate the stock and option-writing program and determine whether
to raise its target price and continue to hold the stock and write covered call
options or, alternatively, whether to deliver the stock in settlement of the
option position or otherwise exit the position by buying back the options
written and selling the stock. If the stock price declines, the Fund will
normally seek to buy back the call options written and to sell new call options
at lower exercise prices on fewer shares. The Fund will seek to execute option
rolls (as

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described above) such that the premium received from writing new options
generally exceeds the amounts paid to close the positions being replaced. The
Fund may also write covered call options with different characteristics and
managed differently than described in this paragraph.

In addition to the intended strategy of selling covered call options, the Fund
may invest up to 20% of its total assets in other derivative instruments
acquired for hedging, risk management and investment purposes (to gain exposure
to securities, securities markets, markets indices and/or currencies consistent
with its investment objectives and policies), provided that no more than 10% of
the Fund's total assets may be invested in such derivative instruments acquired
for non-hedging purposes. Among other derivative strategies, the Fund may
purchase put options on the S&P 500, the S&P MidCap 400, any other broad-based
securities index deemed suitable for this purpose, and/or on individual stocks
held in its portfolio in order to help protect against a decline in the value of
its portfolio securities. Derivative instruments may be used by the Fund to
enhance returns or as a substitute for the purchase or sale of securities.

COMMON STOCKS
Under normal market conditions, the Fund will invest at least 80% of its total
assets in common stocks. Common stock represents an equity ownership interest in
the issuing corporation. Holders of common stock generally have voting rights in
the issuer and are entitled to receive common stock dividends when, as and if
declared by the corporation's board of directors. Common stock normally occupies
the most subordinated position in an issuer's capital structure. Returns on
common stock investments consist of any dividends received plus the amount of
appreciation or depreciation in the value of the stock. The Fund will have
substantial exposure to common stocks.

Although common stocks have historically generated higher average returns than
fixed-income securities over the long term and particularly during periods of
high or rising concerns about inflation, common stocks also have experienced
significantly more volatility in returns and may not maintain their real value
during inflationary periods. An adverse event, such as an unfavorable earnings
report, may depress the value of a particular common stock held by the Fund.
Also, the prices of common stocks are sensitive to general movements in the
stock market and a drop in the stock market may depress the price of common
stocks to which the Fund has exposure. Common stock prices fluctuate for many
reasons, including changes in investors' perceptions of the financial condition
of an issuer or the general condition of the relevant stock market, or when
political or economic events affecting the issuers occur. In addition, common
stock prices may be sensitive to rising interest rates, as the costs of capital
rise and borrowing costs increase.

FOREIGN SECURITIES
The Fund may invest up to 25% of its total assets in securities of issuers
located in countries other than the United States. The value of foreign
securities is affected by changes in currency rates, foreign tax laws (including
withholding tax), government policies (in this country or abroad), relations
between nations and trading, settlement, custodial and other operational risks.
In addition, the costs of investing abroad are generally higher than in the
United States, and foreign securities markets may be less liquid, more volatile
and less subject to governmental supervision than markets in the United States.
Foreign investments also could be affected by other factors not present in the
United States, including expropriation, armed conflict, confiscatory taxation,
lack of uniform accounting and auditing standards, less publicly available
financial and other information and potential difficulties in enforcing
contractual obligations. As an alternative to holding foreign-traded securities,
the Fund may invest in dollar-denominated securities of foreign companies that
trade on U.S. exchanges or in the U.S. over-the-counter market (including
depositary receipts, which evidence ownership in underlying foreign securities).

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Because foreign companies are not subject to uniform accounting, auditing and
financial reporting standards, practices and requirements comparable to those
applicable to U.S. companies, there may be less publicly available information
about a foreign company than about a domestic company. Volume and liquidity in
most foreign debt markets are less than in the United States and securities of
some foreign companies are less liquid and more volatile than securities of
comparable U.S. companies. There is generally less government supervision and
regulation of securities exchanges, broker-dealers and listed companies than in
the United States. Mail service between the United States and foreign countries
may be slower or less reliable than within the United States, thus increasing
the risk of delayed settlements of portfolio transactions or loss of
certificates for portfolio securities. Payment for securities before delivery
may be required. In addition, with respect to certain foreign countries, there
is the possibility of expropriation or confiscatory taxation, political or
social instability, or diplomatic developments, which could affect investments
in those countries. Moreover, individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such respects as growth of gross
national product, rate of inflation, capital reinvestment, resource
self-sufficiency and balance of payments position. Foreign securities markets,
while growing in volume and sophistication, are generally not as developed as
those in the United States, and securities of some foreign issuers (particularly
those located in developing countries) may be less liquid and more volatile than
securities of comparable U.S. companies.

Since the Fund will invest in securities denominated or quoted in currencies
other than the U.S. dollar, the Fund will be affected by changes in foreign
currency exchange rates (and exchange control regulations) which affect the
value of investments in the Fund and the accrued income and appreciation or
depreciation of the investments in U.S. dollars. Changes in foreign currency
exchange rates relative to the U.S. dollar will affect the U.S. dollar value of
the Fund's assets denominated in that currency and the Fund's return on such
assets as well as any temporary uninvested reserves in bank deposits in foreign
currencies. In addition, the Fund will incur costs in connection with
conversions between various currencies.

The Fund may invest in ADRs, EDRs and GDRs. ADRs, EDRs and GDRs are certificates
evidencing ownership of shares of foreign issuers and are alternatives to
purchasing directly the underlying foreign securities in their national markets
and currencies. However, they continue to be subject to many of the risks
associated with investing directly in foreign securities. These risks include
foreign exchange risk as well as the political and economic risks of the
underlying issuer's country. ADRs, EDRs and GDRs may be sponsored or
unsponsored. Unsponsored receipts are established without the participation of
the issuer. Unsponsored receipts may involve higher expenses, they may not pass-
through voting or other shareholder rights, and they may be less liquid.

OPTIONS--GENERALLY
The Fund's principal options activity will consist of writing (selling) covered
call options on common stocks held. Among other potential options strategies,
the Fund may purchase put options on the S&P 500, the S&P MidCap 400, any other
broad-based securities index deemed suitable for this purpose, and/or on
individual stocks held in its portfolio to help protect against a decline in the
value of its portfolio securities. An option on a security is a contract that
gives the holder of the option, in return for a premium, the right to buy from
(in the case of a call) or sell to (in the case of a put) the writer of the
option the security underlying the option at a specified exercise or "strike"
price. The writer of an option on a security has the obligation upon exercise of
the option to deliver the underlying security upon payment of the exercise price
or to pay the exercise price upon delivery of the underlying security. Certain
options, known as "American style" options may be exercised at any time during
the term of the option. Other options, known as "European style" options, may be
exercised only on the expiration date of the option. Since listed options on
individual stocks in the United States are generally American style options, the
Adviser believes that substantially all of the

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single-stock options written or acquired by the Fund will be American style
options. Exchange-traded options on stock indices are generally European style
options.

The Fund will write call options only if they are "covered." A call option on a
common stock or other security is covered if the Fund owns the security
underlying the call or has an absolute and immediate right to acquire that
security without additional cash consideration (or, if additional cash
consideration is required, cash or other assets determined to be liquid by the
Adviser (in accordance with procedures established by the Board) in such amount
are segregated by the Fund's custodian) upon conversion or exchange of other
securities held by the Fund. A call option is also covered if the Fund holds a
call on the same security as the call written where the exercise price of the
call held is (i) equal to or less than the exercise price of the call written,
or (ii) greater than the exercise price of the call written, provided the
difference is maintained by the Fund in segregated assets determined to be
liquid by the Adviser as described above.

If an option written by the Fund expires unexercised, the Fund realizes on the
expiration date a capital gain equal to the premium received by the Fund at the
time the option was written. If an option purchased by the Fund expires
unexercised, the Fund realizes a capital loss equal to the premium paid. Prior
to the earlier of exercise or expiration, an exchange-traded option may be
closed out by an offsetting purchase or sale of an option of the same series
(type, underlying security, exercise price, and expiration). There can be no
assurance, however, that a closing purchase or sale transaction can be effected
when the Fund desires. The Fund may sell put or call options it has previously
purchased, which could result in a net gain or loss depending on whether the
amount realized on the sale is more or less than the premium and other
transaction costs paid on the put or call option when purchased. The Fund will
realize a capital gain from a closing purchase transaction if the cost of the
closing option is less than the premium received from writing the option, or, if
it is more, the Fund will realize a capital loss. If the premium received from a
closing sale transaction is more than the premium paid to purchase the option,
the Fund will realize a capital gain or, if it is less, the Fund will realize a
capital loss. In most cases, net gains from the Fund's option strategy will be
short-term capital gains which, for federal income tax purposes, will constitute
net investment company taxable income. See "Distributions--Federal income tax
matters."

The principal factors affecting the market value of an option include supply and
demand, interest rates, the current market price of the underlying security in
relation to the exercise price of the option, the actual or perceived volatility
of the underlying security, and the time remaining until the expiration date.
The premium paid for an option purchased by the Fund is an asset of the Fund.
The premium received for an option written by the Fund is recorded as an asset
and equivalent liability. The Fund then adjusts over time the liability to the
market value of the option. The value of an option purchased or written is
marked to market daily and is valued at the closing price on the exchange on
which it is traded or, if not traded on an exchange or no closing price is
available, at the mean between the last bid and asked prices or otherwise at
fair value as determined by the Board of the Fund.

The transaction costs of buying and selling options consist primarily of
commissions (which are imposed in opening, closing, exercise and assignment
transactions), but may also include margin and interest costs in particular
transactions. The impact of transaction costs on the profitability of a
transaction may often be greater for options transactions than for transactions
in the underlying securities because these costs are often greater in relation
to options premiums than in relation to the prices of underlying securities.
Transaction costs may be especially significant in option strategies calling for
multiple purchases and sales of options, such as spreads or straddles.
Transaction costs may be different for transactions effected in foreign markets
than for transactions effected in U.S. markets.

Transaction costs associated with the Fund's options strategy will vary
depending on market circumstances and other factors. Although it is not possible
to accurately predict such costs because of

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this variability, the Adviser estimates that such costs on an annualized basis
may range from between 0.20% and 0.30% of the Fund's total assets assuming the
same offering size assumed for purposes of presenting the information set forth
under "Summary of Fund expenses." There can be no certainty that upon changing
market conditions such costs will fall within this range.

CALL OPTIONS AND COVERED CALL WRITING
The Fund does not intend to purchase call options as an investment. It will
follow a principal options strategy known as "covered call option writing,"
which is a strategy designed to generate earnings and offset a portion of a
market decline in the underlying common stock. The Fund will only write (sell)
options on common stocks held in the Fund's portfolio. It may not sell "naked"
call options, i.e., options representing more shares of the stock than are held
in the portfolio.

The standard contract size for an exchange-listed single-stock option is 100
shares of the common stock. There are four items needed to identify a particular
option contract: (1) the underlying security, (2) the expiration month, (3) the
exercise (or strike) price and (4) the type (call or put). For example, 20 ABC
Corp. January 40 call options provide the right to purchase 2,000 shares of ABC
Corp. common stock on or before January 22, 2005 at $40 per share. A call option
whose strike price is above the current price of the underlying stock is called
"out-of-the-money," a call option whose strike price is equal to the current
price of the underlying stock is called "at-the-money" and a call option whose
strike price is below the current price of the underlying stock is called
"in-the-money."

The following is a conceptual example of the returns that may be achieved from a
stock-plus-covered-call position, making the following assumptions: ABC common
stock trades at $36.36 per share and ABC January 40 call options (10%
out-of-the-money) trade at $1.82 per underlying share (5% option premium). This
example is not meant to represent the performance of any actual common stock,
option contract or the Fund itself.

The return over the period until option expiration earned by a holder of ABC
stock who writes ABC January 40 call options and maintains the position until
expiration will be as follows: (1) if the stock price declines 5%, the option
will expire worthless and the holder will have a net return of zero (option
premium offsets loss in stock); (2) if the stock price is flat, the option will
again expire worthless and the holder will have a net return of 5% (option
premium plus no gain or loss on stock); (3) if the stock price rises 10% (to the
$40 strike price), the option will again expire with no value and the holder
will have a net return of 15% (option premium plus 10% stock return); and (4) if
the stock rises 20%, the exercise of the option would limit stock gain to 10%
and total net return to 15%. If the stock price at exercise exceeds the strike
price, returns from the position are capped at 15%.

As demonstrated in the example, writing covered call options on common stocks
lowers the variability of potential returns and can enhance returns in three of
four stock price performance scenarios (down, flat or moderately up). Only when
the stock price at expiration exceeds the sum of the premium received and the
option exercise price would the stock-plus-covered-call strategy be expected to
provide lower returns than the underlying stock. The amount of downside
protection afforded by the strategy in declining stock scenarios is limited,
however, to the amount of option premium received. If the stock price declines
in an amount greater than the option premium, the Fund will incur a net loss.

For conventional listed call options, the option's expiration date can be up to
nine months from the date the call options are first listed for trading.
Longer-term call options can have expiration dates up to three years from the
date of listing. It is anticipated that many options that are written by the
Fund against its stock holdings will be repurchased prior to the option's
expiration date, generating a gain or loss in the options. Options that are not
repurchased prior to expiration are subject to exercise by the option holder if
the stock price at expiration is above the strike price.

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Exchange listed options contracts are originated and standardized by an
independent entity called the Options Clearing Corporation (the "OCC").
Currently, listed options are available on over 2,300 stocks with new listings
added periodically. The Fund will write (sell) call options that are generally
issued, guaranteed and cleared by the OCC. Listed call options are traded on the
American Stock Exchange, Chicago Board Options Exchange International Securities
Exchange, New York Stock Exchange, Pacific Stock Exchange and Philadelphia Stock
Exchange. With multiple exercise prices and expiration dates for options on
different stocks, the Adviser and Sub-Adviser believe that there exist
sufficient opportunities in the options market to meet the needs of the Fund's
investment program.

PUT OPTIONS
Put options are contracts that give the holder of the option, in return for a
premium, the right to sell to the writer of the option the security/index
underlying the option at a specified exercise price at any time during the term
of the option. As discussed above, the Fund may in certain circumstances
purchase put options on the S&P 500, S&P MidCap 400, any other broad-based
securities index deemed suitable for this purpose, and/or on individual stocks
held in the portfolio to help protect against a decline in the value of the
Fund's portfolio securities. The premiums paid to acquire put options will
reduce amounts available for distribution from the Fund's options activity.

ADDITIONAL INVESTMENT PRACTICES

In addition to its primary investment policies, the Fund may engage in the
following investment practices to a limited extent. Under normal market
conditions, the Fund will invest at least 80% of its total assets in common
stocks, including stocks of foreign issuers. The Fund may invest in the
aggregate up to 20% of its total assets in all investments described below.

PREFERRED STOCKS
Preferred stock, like common stock, represents an equity ownership in an issuer.
Generally, preferred stock has a priority of claim over common stock in dividend
payments and upon liquidation of the issuer. Unlike common stock, preferred
stock does not usually have voting rights. Preferred stock in some instances is
convertible into common stock. Although they are equity securities, preferred
stocks have certain characteristics of both debt and common stock. They are
debt-like in that their promised income is contractually fixed. They are common
stock-like in that they do not have rights to precipitate bankruptcy proceedings
or collection activities in the event of missed payments. Furthermore, they have
many of the key characteristics of equity due to their subordinated position in
an issuer's capital structure and because their quality and value are heavily
dependent on the profitability of the issuer rather than on any legal claims to
specific assets or cash flows. The Fund will only invest in preferred stocks
that are rated investment grade at the time of investment or, if unrated,
determined by the Adviser to be of comparable quality. Standard & Poor's Ratings
Group and Fitch Ratings consider securities rated BBB -- and above to be
investment grade and Moody's Investors Service, Inc. considers securities rated
Baa3 and above to be investment grade.

WARRANTS
The Fund may invest in equity and index warrants of domestic and international
issuers. Equity warrants are securities that give the holder the right, but not
the obligation, to subscribe for equity issues of the issuing company or a
related company at a fixed price either on a certain date or during a set
period. Changes in the value of a warrant do not necessarily correspond to
changes in the value of its underlying security. The price of a warrant may be
more volatile than the price of its underlying security, and a warrant may offer
greater potential for capital appreciation as well as capital loss. Warrants do
not entitle a holder to dividends or voting rights with respect to the
underlying security and do not represent any rights in the assets of the issuing
company. A warrant ceases to have value if it is not exercised prior to its
expiration date. These factors can make warrants more speculative than

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other types of investments. The sale of a warrant results in a long- or
short-term capital gain or loss depending on the period for which a warrant is
held.

CONVERTIBLE SECURITIES AND BONDS WITH WARRANTS ATTACHED
The Fund may invest in preferred stocks and fixed-income obligations that are
convertible into common stocks of domestic and foreign issuers, and bonds issued
as a unit with warrants. Convertible securities in which the Fund may invest,
comprised of both convertible debt and convertible preferred stock, may be
converted at either a stated price or at a stated rate into underlying shares of
common stock. Because of this feature, convertible securities generally enable
an investor to benefit from increases in the market price of the underlying
common stock. Convertible securities often provide higher yields than the
underlying equity securities, but generally offer lower yields than
non-convertible securities of similar quality. The value of convertible
securities fluctuates in relation to changes in interest rates like bonds, and,
in addition, fluctuates in relation to the underlying common stock.

SHORT SALES
The Fund may sell a security short if it owns at least an equal amount of the
security sold short or another security convertible or exchangeable for an equal
amount of the security sold short without payment of further compensation (a
short sale against-the-box). In a short sale against-the-box, the short seller
is exposed to the risk of being forced to deliver stock that it holds to close
the position if the borrowed stock is called in by the lender, which would cause
gain or loss to be recognized on the delivered stock. The Fund expects normally
to close its short sales against-the-box by delivering newly acquired stock.

The ability to use short sales against-the-box, certain equity swaps and certain
equity collar strategies as a tax-efficient management technique with respect to
holdings of appreciated securities is limited to circumstances in which the
hedging transaction is closed out not later than thirty days after the end of
the Fund's taxable year in which the transaction was initiated, and the
underlying appreciated securities position is held unhedged for at least the
next sixty days after the hedging transaction is closed. Not meeting these
requirements would trigger the recognition of gain on the underlying appreciated
securities position under the federal tax laws applicable to constructive sales.

TEMPORARY INVESTMENTS
Cash equivalents are highly liquid, short-term securities such as commercial
paper, time deposits, certificates of deposit, short-term notes and short-term
U.S. government obligations. During unusual market circumstances, the Fund may
temporarily invest a substantial portion of its assets in cash or cash
equivalents, which may be inconsistent with the Fund's investment objectives. In
moving to a substantial temporary investments position and in transitioning from
such a position back into full conformity with the Fund's normal investment
objectives and policies, the Fund may incur transaction costs that would not be
incurred if the Fund had remained fully invested in accordance with such normal
policies. The transition to and back from a substantial temporary investments
position may also result in the Fund having to sell common stocks and/or close
out options positions and then later purchase common stocks and open new options
positions in circumstances that might not otherwise be optimal.

WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS
Securities may be purchased on a "forward commitment" or "when-issued" basis
(meaning securities are purchased or sold with payment and delivery taking place
in the future) in order to secure what is considered to be an advantageous price
and yield at the time of entering into the transaction. However, the return on a
comparable security when the transaction is consummated may vary from the return
on the security at the time that the forward commitment or when-issued
transaction was made. From the time of entering into the transaction until
delivery and payment is made at a later

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date, the securities that are the subject of the transaction are subject to
market fluctuations. In forward commitment or when-issued transactions, if the
seller or buyer, as the case may be, fails to consummate the transaction, the
counterparty may miss the opportunity of obtaining a price or yield considered
to be advantageous. Forward commitment or when-issued transactions may occur a
month or more before delivery is due. However, no payment or delivery is made
until payment is received or delivery is made from the other party to the
transaction. Forward commitment or when-issued transactions will not be entered
into for the purpose of investment leverage.

ILLIQUID SECURITIES
The Fund may invest up to 15% of its total assets in securities for which there
is no readily available trading market or are otherwise illiquid. Illiquid
securities include securities legally restricted as to resale, such as
commercial paper issued pursuant to Section 4(2) of the Securities Act of 1933,
as amended, and securities eligible for resale pursuant to Rule 144A thereunder.
Section 4(2) and Rule 144A securities may, however, be treated as liquid by the
Adviser pursuant to procedures adopted by the Board, which require consideration
of factors such as trading activity, availability of market quotations and
number of dealers willing to purchase the security. If the Fund invests in Rule
144A securities, the level of portfolio illiquidity may be increased to the
extent that eligible buyers become uninterested in purchasing such securities.

It may be difficult to sell illiquid securities at a price representing their
fair value until such time as such securities may be sold publicly. Where
registration is required, a considerable period may elapse between a decision to
sell the securities and the time when it would be permitted to sell. Thus, the
Fund may not be able to obtain as favorable a price as that prevailing at the
time of the decision to sell. The Fund may also acquire securities through
private placements under which it may agree to contractual restrictions on the
resale of such securities. Such restrictions might prevent their sale at a time
when such sale would otherwise be desirable.

OTHER DERIVATIVE INSTRUMENTS
In addition to the intended strategy of selling covered call options, the Fund
may invest up to 20% of its total assets in derivative instruments (which are
instruments that derive their value from another instrument, security or index)
acquired for hedging, risk management and investment purposes (to gain exposure
to securities, securities markets, markets indices and/or currencies consistent
with its investment objectives and policies), provided that no more than 10% of
the Fund's total assets may be invested in such derivative instruments acquired
for non-hedging purposes. These strategies may be executed through the use of
derivative contracts in the United States or abroad. In the course of pursuing
these investment strategies, the Fund may purchase and sell equity and
fixed-income indices and other instruments, purchase and sell futures contracts
and options thereon, and enter into various transactions such as swaps, caps,
floors or collars. In addition, derivatives may also include new techniques,
instruments or strategies that are permitted as regulatory changes occur.
Derivative instruments may be used by the Fund to enhance returns or as a
substitute for the purchase or sale of securities.

SWAPS
Swap contracts may be purchased or sold to hedge against fluctuations in
securities prices, interest rates or market conditions, to mitigate non-payment
or default risk, or to gain exposure to particular securities, baskets of
securities, indices or currencies. In a standard "swap" transaction, two parties
agree to exchange the returns (or differentials in rates of return) to be
exchanged or "swapped" between the parties, which returns are calculated with
respect to a "notional amount," i.e., the return on or increase in value of a
particular dollar amount invested at a particular interest rate, or in a
particular security, "basket" of securities or index. The Fund will enter into
swaps only on a net basis, i.e., the two payment streams are netted out, with
the Fund receiving or paying, as the case may be,

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only the net amount of the two payments. If the other party to a swap defaults,
the Fund's risk of loss consists of the net amount of payments that the Fund is
contractually entitled to receive. The net amount of the excess, if any, of the
Fund's obligations over its entitlements will be maintained in a segregated
account by the Fund's custodian. The Fund will not enter into any swap unless
the claims-paying ability of the other party thereto is considered to be
investment grade by the Adviser. If there is a default by the other party to
such a transaction, the Fund will have contractual remedies pursuant to the
agreements related to the transaction. Swaps are traded in the over-the-counter
market. The use of swaps is a highly specialized activity, which involves
investment techniques and risks different from those associated with ordinary
portfolio securities transactions. If the Adviser is incorrect in its forecasts
of market values, interest rates and other applicable factors, the investment
performance of the Fund would be unfavorably affected.

Total return swaps.  Total return swaps are contracts in which one party agrees
to make payments of the total return from the underlying asset(s), which may
include securities, baskets of securities, or securities indices during the
specified period, in return for payments equal to a fixed or floating rate of
interest or the total return from other underlying asset(s).

Interest rate swaps.  Interest rate swaps involve the exchange by the Fund with
another party of their respective commitments to pay or receive interest (e.g.,
an exchange of fixed rate payments for floating rate payments).

FUTURES AND OPTIONS ON FUTURES
The Fund may purchase and sell various kinds of financial futures contracts and
options thereon to seek to hedge against changes in stock prices or interest
rates, for other risk management purposes or to gain exposure to certain
securities, indices and currencies. Futures contracts may be based on various
securities indices and securities. Such transactions involve a risk of loss or
depreciation due to adverse changes in securities prices, which may exceed the
Fund's initial investment in these contracts. The Fund will only purchase or
sell futures contracts or related options in compliance with the rules of the
Commodity Futures Trading Commission. These transactions involve transaction
costs. Sales of futures contracts and related options generally result in
realization of short-term or long-term capital gain depending on the period for
which the investment is held. To the extent that any futures contract or options
on futures contract held by the Fund is a "Section 1256 contract" under the
Internal Revenue Code of 1986, as amended (the "Code"), the contract will be
marked-to-market annually and any gain or loss will be treated as 60% long-term
and 40% short-term, regardless of the holding period for such contract.

SECURITIES LENDING
The Fund may seek to earn income by lending portfolio securities to
broker-dealers or other institutional borrowers. As with other extensions of
credit, there are risks of delay in recovery or even loss of rights in the
securities loaned if the borrower of the securities fails financially. Loans
will be made only to organizations whose credit quality or claims paying ability
is considered by the Adviser to be at least investment grade and when the
expected returns, net of administrative expenses and any finders' fees,
justifies the attendant risk. Securities loans currently are required to be
secured continuously by collateral in cash, cash equivalents (such as money
market instruments) or other liquid securities held by the custodian and
maintained in an amount at least equal to the market value of the securities
loaned. The financial condition of the borrower will be monitored by the Adviser
on an ongoing basis. The Fund will not lend portfolio securities subject to a
written covered call contract.

BORROWINGS
The Fund may borrow money to the extent permitted under the 1940 Act as
interpreted, modified or otherwise permitted by the regulatory authority having
jurisdiction. Although there is no current

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intention to do so, the Fund may in the future from time to time borrow money to
add leverage to the portfolio. The Fund may also borrow money for temporary
administrative purposes.

REVERSE REPURCHASE AGREEMENTS
The Fund may enter into reverse repurchase agreements. Under a reverse
repurchase agreement, the Fund temporarily transfers possession of a portfolio
instrument to another party, such as a bank or broker-dealer, in return for
cash. At the same time, the Fund agrees to repurchase the instrument at an
agreed upon time (normally within seven days) and price, which reflects an
interest payment. The Fund may enter into such agreements when it is able to
invest the cash acquired at a rate higher than the cost of the agreement, which
would increase earned income. Income realized on reverse repurchase agreements
will be taxable as ordinary income.

When the Fund enters into a reverse repurchase agreement, any fluctuations in
the market value of either the securities transferred to another party or the
securities in which the proceeds may be invested would affect the market value
of the Fund's assets. As a result, such transactions may increase fluctuations
in the market value of the Fund's assets. While there is a risk that large
fluctuations in the market value of the Fund's assets could affect net asset
value, this risk is not significantly increased by entering into reverse
repurchase agreements, in the opinion of the Adviser. Because reverse repurchase
agreements may be considered to be the practical equivalent of borrowing funds,
they constitute a form of leverage and may be subject to leverage risks. Such
agreements will be treated as subject to investment restrictions regarding
"borrowings." If the Fund reinvests the proceeds of a reverse repurchase
agreement at a rate lower than the cost of the agreement, entering into the
agreement will lower the Fund's yield.

PORTFOLIO TURNOVER
The Fund will buy and sell securities to seek to accomplish it investment
objectives. Portfolio turnover generally involves some expense to the Fund,
including brokerage commissions and other transaction costs on the sale of
securities and reinvestment in other securities. Higher portfolio turnover may
decrease the after-tax return to Common Shareholders to the extent it results in
a decrease of the long-term capital gains portion of distributions to Common
Shareholders. Although the Fund cannot accurately predict its portfolio turnover
rate, under normal market conditions it expects to maintain relatively low core
turnover of its stock portfolio, not considering purchases and sales of stock
and options in connection with the Fund's options program. On an overall basis,
the Fund's annual turnover rate may exceed 100%. A high turnover rate (100% or
more) necessarily involves greater trading costs to the Fund and may result in
greater realization of taxable capital gains.

RISK CONSIDERATIONS

NO OPERATING HISTORY
The Fund is a closed-end investment company with no history of operations and is
designed for long-term investors and not as a trading vehicle.

INVESTMENT AND MARKET RISK
An investment in Common Shares is subject to investment risk, including the
possible loss of the entire principal amount invested. An investment in Common
Shares represents an indirect investment in the securities owned by the Fund,
which are generally traded on a securities exchange or in the over-the-counter
markets. The value of these securities, like other market investments, may move
up or down, sometimes rapidly and unpredictably. In addition, by writing
(selling) call options on the equity securities held in the Fund's portfolio,
the capital appreciation potential of such securities will be limited to the
difference between the exercise price of the call options written and the
purchase price of the equity security underlying such options. The Common Shares
at any point in time may be worth less than the original investment, even after
taking into account any reinvestment of distributions.

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ISSUER RISK
The value of securities held by the Fund may decline for a number of reasons
that directly relate to the issuer, such as management performance, financial
leverage and reduced demand for the issuer's goods and services.

EQUITY RISK
At least 80% of the Fund's total assets will be invested in common stocks and
therefore a principal risk of investing in the Fund is equity risk. Equity risk
is the risk that securities held by the Fund will fall due to general market or
economic conditions, perceptions regarding the industries in which the issuers
of securities held by the Fund participate, and the particular circumstances and
performance of particular companies whose securities the Fund holds. Although
common stocks have historically generated higher average returns than
fixed-income securities over the long term, common stocks also have experienced
significantly more volatility in returns. An adverse event, such as an
unfavorable earnings report, may depress the value of equity securities of an
issuer held by the Fund; the price of common stock of an issuer may be
particularly sensitive to general movements in the stock market; or a drop in
the stock market may depress the price of most or all of the common stocks and
other equity securities held by the Fund. In addition, common stock of an issuer
in the Fund's portfolio may decline in price if the issuer fails to make
anticipated dividend payments because, among other reasons, the issuer of the
security experiences a decline in its financial condition. Common equity
securities in which the Fund will invest are structurally subordinated to
preferred stocks, bonds and other debt instruments in a company's capital
structure, in terms of priority to corporate income, and therefore will be
subject to greater dividend risk than preferred stocks or debt instruments of
such issuers. Finally, common stock prices may be sensitive to rising interest
rates, as the costs of capital rise and borrowing costs increase.

RISKS ASSOCIATED WITH OPTIONS ON SECURITIES
There are numerous risks associated with transactions in options on securities.
A decision as to whether, when and how to use options involves the exercise of
skill and judgment, and even a well-conceived transaction may be unsuccessful to
some degree because of market behavior or unexpected events. As the writer of a
covered call option, the Fund forgoes, during the option's life, the opportunity
to profit from increases in the market value of the security covering the call
option above the sum of the option premium received and the exercise price of
the call, but has retained the risk of loss, minus the option premium received,
should the price of the underlying security decline. The writer of an option has
no control over when during the exercise period of the option it may be required
to fulfill its obligation as a writer of the option. Once an option writer has
received an exercise notice, it cannot effect a closing purchase transaction in
order to terminate its obligation under the option and must deliver the
underlying security at the exercise price. Thus, the use of options may require
the Fund to sell portfolio securities at inopportune times or for prices other
than current market values, will limit the amount of appreciation the Fund can
realize above the exercise price of an option on a common stock, or may cause
the Fund to hold a security that it might otherwise sell.

The value of options may be adversely affected if the market for such options
becomes less liquid or smaller. There can be no assurance that a liquid market
will exist when the Fund seeks to close out an option position either, in the
case of a call option written, by buying the option, or, in the case of a
purchased put option, by selling the option. Reasons for the absence of a liquid
secondary market on an exchange include the following: (i) there may be
insufficient trading interest in certain options; (ii) restrictions may be
imposed by an exchange on opening transactions or closing transactions or both;
(iii) trading halts, suspensions or other restrictions may be imposed with
respect to particular classes or series of options; (iv) unusual or unforeseen
circumstances may interrupt normal operations on an exchange; (v) the facilities
of an exchange or the OCC may not at all times be adequate to

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handle current trading volume; or (vi) one or more exchanges could, for economic
or other reasons, decide or be compelled to discontinue the trading of options
(or a particular class or series of options) at some future date. If trading
were discontinued, the secondary market on that exchange (or in that class or
series of options) would cease to exist. However, outstanding options on that
exchange that had been issued by the OCC as a result of trades on that exchange
would continue to be exercisable in accordance with their terms. The Fund's
ability to terminate over-the-counter options will be more limited than with
exchange-traded options and may involve the risk that broker-dealers
participating in such transactions will not fulfill their obligations. If the
Fund were unable to close out a covered call option that it had written on a
security, it would not be able to sell the underlying security unless the option
expired without exercise.

The hours of trading for options may not conform to the hours during which the
underlying securities are traded. To the extent that the options markets close
before the markets for the underlying securities, significant price and rate
movements can take place in the underlying markets that would not be reflected
concurrently in the options markets. Call options are marked to market daily and
their value will be affected by changes in the value of and dividend rates of
the underlying common stocks, changes in interest rates, changes in the actual
or perceived volatility of the stock market and the underlying common stocks and
the remaining time to the options' expiration. Additionally, the exercise price
of an option may be adjusted downward before the option's expiration as a result
of the occurrence of certain corporate events affecting the underlying equity
security, such as extraordinary dividends, stock splits, merger or other
extraordinary distributions or events. A reduction in the exercise price of an
option would reduce the Fund's capital appreciation potential on the underlying
security.

The number of call options the Fund can write is limited by the number of shares
of common stock the Fund holds, and further limited by the fact that listed call
options on individual common stocks generally trade in units representing 100
shares of the underlying stock. Furthermore, the Fund's options transactions
will be subject to limitations established by each of the exchanges, boards of
trade or other trading facilities on which such options are traded. These
limitations govern the maximum number of options in each class which may be
written or purchased by a single investor or group of investors acting in
concert, regardless of whether the options are written or purchased on the same
or different exchanges, boards of trade or other trading facilities or are held
or written in one or more accounts or through one or more brokers. Thus, the
number of options which the Fund may write or purchase may be affected by
options written or purchased by other investment advisory clients of the Adviser
or Sub-Adviser. An exchange, board of trade or other trading facility may order
the liquidation of positions found to be in excess of these limits, and may
impose certain other sanctions. The Fund will not write "naked" or uncovered
call options.

If the Fund purchases put options for hedging or risk management purposes, the
Fund will be subject to the following additional risks. A put option acquired by
the Fund and not sold prior to expiration will expire worthless if the price of
the stock or index at expiration exceeds the exercise price of the option,
thereby causing the Fund to lose its entire investment in the option. If
restrictions on exercise were imposed, the Fund might be unable to exercise an
option it had purchased. If the Fund were unable to close out an option that it
had purchased, it would have to exercise the option in order to realize any
profit or the option may expire worthless. Stock market indices on which the
Fund may purchase options positions likely will not mirror the Fund's actual
portfolio holdings. The effectiveness of index put options as hedges against
declines in the Fund's stock portfolio will be limited to the extent that the
performance of the underlying index does not correlate with that of the Fund's
holdings.

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RISKS OF MID-CAP COMPANIES
The Fund may invest substantially in companies whose market capitalization is
considered middle sized or "mid-cap." Mid-cap companies often are newer or less
established companies than larger companies. Investments in mid-cap companies
carry additional risks because earnings of these companies tend to be less
predictable; they often have limited product lines, markets, distribution
channels or financial resources; and the management of such companies may be
dependent upon one or a few key people. The market movements of equity
securities of mid-cap companies may be more abrupt or erratic than the market
movements of equity securities of larger, more established companies or the
stock market in general. Historically, mid-cap companies have sometimes gone
through extended periods when they did not perform as well as larger companies.
In addition, equity securities of mid-cap companies generally are less liquid
than those of larger companies. This means that the Fund could have greater
difficulty selling such securities at the time and price that the Fund would
like.

RISKS OF GROWTH STOCK INVESTING
The Fund expects to invest substantially in stocks with "growth"
characteristics. Growth stocks can react differently to issuer, political,
market, and economic developments than the market as a whole and other types of
stocks. Growth stocks tend to be more expensive relative to their earnings or
assets compared to other types of stocks. As a result, growth stocks tend to be
sensitive to changes in their earnings and more volatile than other types of
stocks.

DISTRIBUTION RISK
The monthly distributions Common Shareholders receive from the Fund will be
based primarily on the level of net option premiums and the dividends received
by the Fund. Net option premiums and dividend payments the Fund receives in
respect of its portfolio securities can vary widely over the short- and
long-term. If stock prices or stock price volatility declines, the level of
premiums from options writing and the amounts available for distribution from
options activity will likely decrease as well. Payments to purchase put options
and to close written call options will reduce amounts available for distribution
from call option premiums received and proceeds of closing put options.
Dividends on common stocks are not fixed but are declared at the discretion of
the issuer's board of directors. There is no guarantee that the issuers of
common stocks in which the Fund invests will declare dividends in the future or
that if declared they will remain at current levels or increase over time.
Dividends on any preferred stocks in which the Fund may invest are not
guaranteed and certain issues of preferred stock held by the Fund may be called
by the issuer.

FOREIGN SECURITY RISK
The Fund may have substantial exposure to foreign securities. The value of
foreign securities is affected by changes in currency rates, foreign tax laws
(including withholding tax), government policies (in this country or abroad),
relations between nations and trading, settlement, custodial and other
operational risks. In addition, the costs of investing abroad are generally
higher than in the United States, and foreign securities markets may be less
liquid, more volatile and less subject to governmental supervision than markets
in the United States. Foreign investments also could be affected by other
factors not present in the United States, including expropriation, armed
conflict, confiscatory taxation, lack of uniform accounting and auditing
standards, less publicly available financial and other information and potential
difficulties in enforcing contractual obligations. As an alternative to holding
foreign-traded securities, the Fund may invest in dollar-denominated securities
of foreign companies that trade on U.S. exchanges or in the U.S.
over-the-counter market (including depositary receipts, which evidence ownership
in underlying foreign securities). Since the Fund may invest in securities
denominated or quoted in currencies other than the U.S. dollar, the Fund will be
affected by changes in foreign currency exchange rates (and exchange control
regulations) which affect the value of

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investments in the Fund and the accrued income and appreciation or depreciation
of the investments in U.S. dollars. Changes in foreign currency exchange rates
relative to the U.S. dollar will affect the U.S. dollar value of the Fund's
assets denominated in that currency and the Fund's return on such assets as well
as any temporary uninvested reserves in bank deposits in foreign currencies. In
addition, the Fund will incur costs in connection with conversions between
various currencies.

Because foreign companies are not subject to uniform accounting, auditing and
financial reporting standards, practices and requirements comparable to those
applicable to U.S. companies, there may be less publicly available information
about a foreign company than about a domestic company. Volume and liquidity in
most foreign debt markets are less than in the United States and securities of
some foreign companies are less liquid and more volatile than securities of
comparable U.S. companies. There is generally less government supervision and
regulation of securities exchanges, broker-dealers and listed companies than in
the United States. Mail service between the United States and foreign countries
may be slower or less reliable than within the United States, thus increasing
the risk of delayed settlements of portfolio transactions for, or loss of
certificates of, portfolio securities. Payment for securities before delivery
may be required. In addition, with respect to certain foreign countries, there
is the possibility of expropriation or confiscatory taxation, political or
social instability, or diplomatic developments, which could affect investments
in those countries. Moreover, individual foreign economies may differ favorably
or unfavorably from the U.S. economy in such respects as growth of gross
national product, rate of inflation, capital reinvestment, resource
self-sufficiency and balance of payments position. Foreign securities markets,
while growing in volume and sophistication, are generally not as developed as
those in the United States, and securities of some foreign issuers (particularly
those located in developing countries) may be less liquid and more volatile than
securities of comparable U.S. companies.

INTEREST RATE RISK
The level of premiums from call options writing and the amounts available for
distribution from the Fund's options activity may decrease in declining interest
rate environments. Any preferred stocks paying fixed dividend rates in which the
Fund invests, will likely change in value as market interest rates change. When
interest rates rise, the market value of such securities generally will fall. To
the extent that the Fund invests in preferred stocks, the net asset value and
price of the Common Shares may decline if market interest rates rise. Interest
rates are currently low relative to historic levels. During periods of declining
interest rates, an issuer of preferred stock may exercise its option to redeem
securities prior to maturity, forcing the Fund to reinvest in lower yielding
securities. This is known as call risk. During periods of rising interest rates,
the average life of certain types of securities may be extended because of
slower than expected payments. This may lock in a below market yield, increase
the security's duration, and reduce the value of the security. This is known as
extension risk. The value of the Fund's common stock investments may also be
influenced by changes in interest rates.

SECTOR RISK
The Fund may invest a significant portion of its assets in securities of issuers
in any single industry or sector of the economy (a broad based economic segment
that may include many distinct industries) if companies in that industry or
sector meet the Fund's investment criteria. If the Fund is focused in an
industry or sector, it may present more risks than if it were broadly
diversified over numerous industries or sectors of the economy. This may make
the Fund more susceptible to adverse economic, political, or regulatory
occurrences affecting these sectors. A "sector" is a broader economic segment
that may include many different industries. As the percentage of the Fund's
assets invested in a particular sector increases, so does the potential for
fluctuation in the net asset value of Common Shares. The Fund may not invest 25%
or more of its total assets in the securities of issuers in any single industry
or group of industries.

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DERIVATIVES RISK
In addition to writing covered call options, the risks of which are described
above, the Fund may invest up to 20% of its total assets in other derivative
investments acquired for hedging, risk management and investment purposes.
Derivative transactions including options on securities and securities indices
and other transactions in which the Fund may engage (such as futures contracts
and options thereon, swaps and short sales) may subject the Fund to increased
risk of principal loss due to unexpected movements in stock prices, changes in
stock volatility levels and interest rates, and imperfect correlations between
the Fund's securities holdings and indices upon which derivative transactions
are based. The Fund also will be subject to credit risk with respect to the
counterparties to any over-the-counter derivatives contracts purchased by the
Fund. If a counterparty becomes bankrupt or otherwise fails to perform its
obligations under a derivative contract due to financial difficulties, the Fund
may experience significant delays in obtaining any recovery under the derivative
contract in a bankruptcy or other reorganization proceeding. The Fund may obtain
only a limited recovery or may obtain no recovery in such circumstances.

LIQUIDITY RISK
The Fund may invest up to 15% of its total assets in securities for which there
is no readily available trading market or which are otherwise illiquid. The Fund
may not be able readily to dispose of such securities at prices that approximate
those at which the Fund could sell such securities if they were more widely
traded and, as a result of such illiquidity, the Fund may have to sell other
investments or engage in borrowing transactions if necessary to raise cash to
meet its obligations. In addition, the limited liquidity could affect the market
price of the securities, thereby adversely affecting the Fund's net asset value.

INFLATION RISK
Inflation risk is the risk that the purchasing power of assets or income from
investment will be worth less in the future as inflation decreases the value of
money. As inflation increases, the real value of the Common Shares and
distributions thereon can decline.

MARKET PRICE OF COMMON SHARES
The shares of closed-end management investment companies often trade at a
discount from their net asset value, and the Fund's Common Shares may likewise
trade at a discount from net asset value. The trading price of the Fund's Common
Shares may be less than the public offering price. The returns earned by Common
Shareholders who purchased their Common Shares in this offering and sell their
Common Shares below net asset value will be reduced.

FINANCIAL LEVERAGE
Although the Fund has no current intention to do so, the Fund is authorized to
utilize leverage through the issuance of preferred shares and/or borrowings,
including the issuance of debt securities. In the event that the Fund determines
in the future to utilize investment leverage, there can be no assurance that
such a leveraging strategy will be successful during any period in which it is
employed. Leverage creates risks for Common Shareholders, including the
likelihood of greater volatility of net asset value and market price of the
Common Shares and the risk that fluctuations in distribution rates on any
preferred shares or fluctuations in borrowing costs may affect the return to
Common Shareholders. To the extent the income derived from securities purchased
with proceeds received from leverage exceeds the cost of leverage, the Fund's
distributions will be greater than if leverage had not been used. Conversely, if
the income from the securities purchased with such proceeds is not sufficient to
cover the cost of leverage, the amount available for distribution to Common
Shareholders will be less than if leverage had not been used. In the latter
case, Eaton Vance, in its best judgment, may nevertheless determine to maintain
the Fund's leveraged position if it deems such action to be

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appropriate. The costs of an offering of preferred shares and/or a borrowing
program would be borne by Common Shareholders and consequently would result in a
reduction of the net asset value of Common Shares. In addition, the fee paid to
Eaton Vance will be calculated on the basis of the Fund's average daily gross
assets, including proceeds from the issuance of preferred shares and/or
borrowings, so the fees will be higher when leverage is utilized. In this
regard, holders of preferred shares do not bear the investment advisory fee.
Rather, Common Shareholders bear the portion of the investment advisory fee
attributable to the assets purchased with the proceeds of the preferred shares
offering.

MANAGEMENT RISK
The Fund is subject to management risk because it is an actively managed
portfolio. Eaton Vance, Rampart and the individual portfolio managers will apply
investment techniques and risk analyses in making investment decisions for the
Fund, but there can be no guarantee that these will produce the desired results.
The Fund may be subject to additional management risk because the Fund's options
program will require effective coordination between the Adviser and the
Sub-Adviser.

MARKET DISRUPTION
The terrorist attacks in the United States on September 11, 2001 had a
disruptive effect on the securities markets. These terrorist attacks and related
events, including the war in Iraq, its aftermath, and continuing occupation of
Iraq by coalition forces, have raised short-term market risk and may have
adverse long-term effects on U.S. and world economies and markets. A similar
disruption of the financial markets could impact trading in common stocks and
stock options, interest rates, credit risk, inflation and other factors relating
to the Common Shares. The Fund cannot predict the effects of similar events in
the future on the U.S. economy and securities markets.

ANTI-TAKEOVER PROVISIONS
The Fund's Agreement and Declaration of Trust includes provisions that could
have the effect of limiting the ability of other persons or entities to acquire
control of the Fund or to change the composition of its Board. See "Description
of capital structure--Anti-takeover provisions in the Declaration of Trust."

Management of the Fund

BOARD OF TRUSTEES

The management of the Fund, including general supervision of the duties
performed by the Adviser under the Advisory Agreement (as defined below) and the
Sub-Adviser under the Sub-Advisory Agreement (as defined below), is the
responsibility of the Fund's Board under the laws of The Commonwealth of
Massachusetts and the 1940 Act.

THE ADVISER

Eaton Vance acts as the Fund's investment adviser under an Investment Advisory
Agreement (the "Advisory Agreement"). The Adviser's principal office is located
at The Eaton Vance Building, 255 State Street, Boston, Massachusetts 02109.
Eaton Vance, its affiliates and predecessor companies have been managing assets
of individuals and institutions since 1924 and of investment funds since 1931.
Eaton Vance (or its affiliates) currently serves as the investment adviser to
investment funds and various individual and institutional clients with combined
assets under management of approximately $94.5 billion as of October 31, 2004,
including approximately $55.8 billion in equity assets. Eaton Vance is a direct,
wholly-owned subsidiary of Eaton Vance Corp., a publicly-held holding company,
which through its subsidiaries and affiliates engages primarily in investment
management, administration and marketing activities.

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MANAGEMENT OF THE FUND
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Under the general supervision of the Fund's Board, the Adviser will carry out
the investment and reinvestment of the assets of the Fund, will furnish
continuously an investment program with respect to the Fund, will determine
which securities should be purchased, sold or exchanged, and will implement such
determinations. The Adviser will furnish to the Fund investment advice and
office facilities, equipment and personnel for servicing the investments of the
Fund. The Adviser will compensate all Trustees and officers of the Fund who are
members of the Adviser's organization and who render investment services to the
Fund, and will also compensate all other Adviser personnel who provide research
and investment services to the Fund. In return for these services, facilities
and payments, the Fund has agreed to pay the Adviser as compensation under the
Advisory Agreement an annual fee in the amount of 1.00% of the average daily
gross assets of the Fund. Gross assets of the Fund means total assets of the
Fund, including any form of investment leverage that the Fund may in the future
determine to utilize, minus all accrued expenses incurred in the normal course
of operations, but not excluding any liabilities or obligations attributable to
any future investment leverage obtained through (i) indebtedness of any type
(including, without limitation, borrowing through a credit facility/commercial
paper program or the issuance debt securities), (ii) the issuance of preferred
shares or other similar preference securities, (iii) the reinvestment of
collateral received for securities loaned in accordance with the Fund's
investment objectives and policies, and/or (iv) any other means. During any
future periods in which the Fund is using leverage, the fees paid to Eaton Vance
for investment advisory services will be higher than if the Fund did not use
leverage because the fees paid will be calculated on the basis of the Fund's
gross assets, including proceeds from any borrowings and from the issuance of
preferred shares.

Walter A. Row, Lewis R. Piantedosi and other Eaton Vance investment
professionals comprise the investment team responsible for the overall
management of the Fund's investments. Mr. Row and Mr. Piantedosi are the
portfolio managers responsible for the day-to-day management of the Fund's
investment portfolio.

Mr. Row is a Vice President and the Director of Equity Research at Eaton Vance.
He is a member of Eaton Vance's Equity Strategy Committee, manages another Eaton
Vance registered investment company and has been an equity analyst and member of
Eaton's Vance's equity research team since 1996.

Mr. Piantedosi is a Vice President of Eaton Vance. He is a member of Eaton
Vance's Equity Strategy Committee and co-manager of another Eaton Vance
registered investment company. He first joined Eaton Vance's equity group in
1996.

THE SUB-ADVISER

Eaton Vance has engaged Rampart Investment Management Company, Inc. to serve as
a sub-adviser to the Fund to provide advice on and execution of the Fund's
options strategy. The Sub-Adviser's principal office is located at One
International Place, Boston, Massachusetts 02110. Rampart Investment Management
Company, Inc. was founded in 1983 by its current principals Ronald M. Egalka and
David R. Fraley. The Sub-Adviser provides customized investment management
services within its core competency in options program management to a spectrum
of institutional and high net worth clients. Since its inception, the
Sub-Adviser has continuously expanded its computer modeling and analytical
capabilities and created tools to identify and capitalize on opportunities in
the options markets. Rampart managed approximately $1.8 billion in assets as of
November 30, 2004.

Mr. Egalka and Mr. Fraley are responsible for the development and implementation
of Rampart's options strategy utilized in managing the Fund.

Mr. Egalka is President and CEO of Rampart. He is also President of Rampart
Securities, Inc., an affiliate of the Sub-Adviser and a NASD member
broker/dealer. Mr. Egalka oversees the development

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MANAGEMENT OF THE FUND
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and implementation of investment strategies and tactics for Rampart. He has
created a variety of analytical and management tools including the Rampart Time
Premium Index, published each week in Barron's, the Rampart Volatility Indexes
and the Rampart Options Management System (ROMS), the technological platform
from which Rampart's portfolio managers deliver the company's equity options
management expertise.

As one of the early pioneers in personal computers and quantitative hedging, Mr.
Egalka was a founding director of the Boston Computer Society, charter member of
the National Options and Futures Society, a founder of the Boston Options
Society and a guest lecturer on derivatives at Boston College. From 1973 to
1981, he was a portfolio manager and senior research officer at The Boston
Company, specializing in hedged equity strategies. In 1981, Mr. Egalka joined
Colonial Management Associates where he developed and managed a corporate cash
management mutual fund and many of the company's portfolio hedging capabilities.

A long time proponent of hedged equities as an asset class, Mr. Egalka has
focused on helping create an industry benchmark for options programs. The
creation and subsequent launch of the CBOE/ S&P 500 BuyWrite Index (BXM) in 2002
was the realization of that objective. In 2003, the CBOE announced that it had
licensed the BXM to Rampart as the strategic basis for new options investment
vehicles.

Mr. Fraley is Managing Director/Manager of Marketing and Client Service at
Rampart. He manages Rampart's new product development and customization of
existing investment strategies for specific client needs. Prior to joining
Rampart, Mr. Fraley served in a number of management roles with Merrill Lynch
Capital Markets in Boston from 1975 through 1983.

Under the terms of the Sub-Advisory Agreement (the "Sub-Advisory Agreement")
between Eaton Vance and the Sub-Adviser, Eaton Vance (and not the Fund) will pay
the Sub-Adviser a fee at a annual rate equal to 0.235% of the average daily
gross assets of the Fund. Pursuant to the terms of the Advisory Agreement, Eaton
Vance, upon approval by the Board, may terminate the Sub-Advisory Agreement and
Eaton Vance may assume full responsibility for the services provided by the
Sub-Adviser without the need for approval by shareholders of the Fund. Rampart
has agreed to reimburse Eaton Vance in certain circumstances for a portion of
the payments that Eaton Vance makes to UBS Securities LLC under a shareholder
servicing agreement. See "Underwriting."

The Fund, the Adviser and the Sub-Adviser have adopted codes of ethics relating
to personal securities transactions (the "Codes of Ethics"). The Codes of Ethics
permit Adviser and Sub-Adviser personnel to invest in securities (including
securities that may be purchased or held by the Fund) for their own accounts,
subject to certain pre-clearance, reporting and other restrictions and
procedures contained in such Codes of Ethics.

THE ADMINISTRATOR

Eaton Vance serves as administrator of the Fund, but currently receives no
compensation for providing administrative services to the Fund. Under an
Administration Agreement with the Fund (the "Administration Agreement"), Eaton
Vance is responsible for managing the business affairs of the Fund, subject to
the supervision of the Fund's Board. Eaton Vance will furnish to the Fund all
office facilities, equipment and personnel for administering the affairs of the
Fund. Eaton Vance's administrative services include recordkeeping, preparation
and filing of documents required to comply with federal and state securities
laws, supervising the activities of the Fund's custodian and transfer agent,
providing assistance in connection with the Board and shareholders' meetings,
providing service in connection with any repurchase offers and other
administrative services necessary to conduct the Fund's business.

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Distributions

Commencing with the Fund's first distribution, the Fund intends to make regular
monthly distributions to Common Shareholders based upon the Fund's projected
annual cash available from option premiums and dividends. For distribution
purposes, "cash available from option premiums and dividends" will consist of
the total proceeds of options sales plus dividends and interest received, less
amounts paid to purchase options and Fund expenses. The Fund's distribution rate
may be adjusted from time-to-time. The Board may modify this distribution policy
at any time without obtaining the approval of Common Shareholders. The initial
distribution is expected to be declared approximately 45-60 days and paid
approximately 60-90 days after the completion of this offering, depending on
market conditions.

The Fund's annual cash available from options premiums and dividends will likely
differ from annual net investment income. The investment income of the Fund will
consist of all dividend and interest income accrued on portfolio investments,
short-term capital gain (including, short-term gains on terminated option
positions and gains on the sale of portfolio investments held for one year or
less) in excess of long-term capital loss and income from certain hedging
transactions, less all expenses of the Fund. Expenses of the Fund will be
accrued each day. The Fund expects that over time it will distribute all of its
investment company taxable income. In addition, at least annually, the Fund
intends to distribute any net capital gain (which is the excess of net long-term
capital gain over net short-term capital loss).

To the extent that that Fund's net investment income and net capital gain (which
is the excess of net long-term capital gain over net short-capital loss) for any
taxable year exceed the total monthly income distributions paid during the year,
the Fund will make a special distribution at or near year-end of such excess
amount as may be required to maintain its qualification as a regulated
investment company or to avoid income and excise taxes. If the Fund's total
monthly distributions in any taxable year exceed the amount of its net
investment income and net capital gain for the year, any such excess would be
characterized as a return of capital. Under the 1940 Act, for any distribution
that includes amounts from sources other than net income, the Fund is required
to provide Common Shareholders a written statement regarding the components of
such distribution.

If, for any taxable year, as discussed above, the total distributions made under
the Fund's policy exceed the Fund's current and accumulated earnings and
profits, the excess will be treated as a tax-free return of capital to each
Common Shareholder (up to the amount of the Common Shareholder's basis in his or
her Common Shares) and thereafter as gain from the sale of Common Shares. The
amount treated as a tax-free return of capital will reduce the Common
Shareholder's adjusted basis in his or her Common Shares, thereby increasing his
or her potential gain or reducing his or her potential loss on the subsequent
sale of his or her Common Shares. To the extent the Fund's distribution policy
results in distributions in excess of its net investment taxable income and net
capital gain, such distributions will decrease its total assets and increase its
expense ratio to a greater extent than would have been the case if distributions
were limited to these amounts. Distributions in any year may or may not include
a substantial return of capital component.

To permit the Fund to maintain more stable distributions, distribution rates
will be based on projected annual cash available from options premiums and
dividends. As a result, the distributions paid by the Fund for any particular
month may be more or less than the amount of cash available from options
premiums and dividends for that month. In such circumstances, the Fund may have
to sell a portion of its investment portfolio to make a distribution at a time
when independent investment judgment might not dictate such action.
Undistributed net investment income is included in the Common Shares' net asset
value, and, correspondingly, distributions from net investment income will
reduce the Common Shares' net asset value.

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Common Shareholders may elect automatically to reinvest some or all of their
distributions in additional Common Shares under the Fund's dividend reinvestment
plan. See "Dividend reinvestment plan."

The Fund has applied for an order from the SEC granting exemption from Section
19(b) of the Investment Company Act, and Rule 19b-1 thereunder to permit the
Fund to include realized long-term capital gains as a part of its regular
distributions to Common Shareholders more frequently than would otherwise be
permitted by the Investment Company Act. The Fund will not pursue this
distribution policy until it receives such an exemptive order. There is no
guarantee that the SEC will grant such exemptive relief. However, if the Fund
fails to receive the requested relief and the Fund is unable to include realized
capital gains in regular distributions more frequently than would otherwise be
permitted by the Investment Company Act, the Adviser does not believe that the
distribution policy, as set forth above, will otherwise be adversely affected.

FEDERAL INCOME TAX MATTERS

The following discussion of federal income tax matters is based on the advice of
Kirkpatrick & Lockhart LLP, counsel to the Fund. The Fund intends to elect to be
treated and to qualify each year as a regulated investment company under the
Code. Accordingly, the Fund intends to satisfy certain requirements relating to
sources of its income and diversification of its assets and to distribute
substantially all of its net income and net short-term and long-term capital
gains (after reduction by any available capital loss carryforwards) in
accordance with the timing requirements imposed by the Code, so as to maintain
its regulated investment company status and to avoid paying any federal income
or excise tax. To the extent it qualifies for treatment as a regulated
investment company and satisfies the above-mentioned distribution requirements,
the Fund will not be subject to federal income tax on income paid to its
shareholders in the form of dividends or capital gains distributions.

The Fund's transactions in options are subject to special and complex federal
income tax provisions that may, among other things, (i) convert dividends that
would otherwise constitute qualified dividend income into higher taxed
short-term capital gain or ordinary income, (ii) treat dividends that would
otherwise be eligible for the corporate dividends received deduction as
ineligible for such treatment, (iii) disallow, suspend or otherwise limit the
allowance of certain losses or deductions, (iv) convert long-term capital gain
into short-term capital gain or ordinary income, (v) convert an ordinary loss or
deduction into a capital loss (the deductibility of which is more limited) and
(vi) cause the Fund to recognize income or gain without a corresponding receipt
of cash.

The taxation of equity options such as the Fund expects to write and purchase is
governed by Code Section 1234. Pursuant to Code Section 1234, the premium
received by the Fund for writing a call option is not included in income at the
time of receipt. If the option expires, the premium is short-term capital gain
to the Fund. If the Fund enters into a closing transaction, the difference
between the amount paid to close out its position and the premium received for
writing the option is short-term capital gain or loss. If a call option written
by the Fund is exercised, thereby requiring the Fund to sell the underlying
security, the premium will increase the amount realized upon the sale of the
security and any resulting gain or loss will be long-term or short-term,
depending upon the Fund's holding period of the security. With respect to a put
on a stock that is purchased by the Fund, if the option is sold, any resulting
gain or loss will be a capital gain or loss, and will be short-term or
long-term, depending upon the Fund's holding period for the option. If the
option expires, the resulting loss is a capital loss and is short-term or
long-term, depending upon the Fund's holding period for the option. If the
option is exercised, the amount paid to acquire the put option reduces the
amount realized on the underlying security in determining gain or loss. Because
the Fund does not have control over the exercise of the call options it writes,
such exercise or other required sales of the underlying securities may cause the
Fund to realize capital gains or losses at inopportune times.

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In the case of Fund transactions in so-called "Section 1256 Contracts," such as
many listed index options and any listed non-equity options, Code Section 1256
generally will require any gain or loss arising from the lapse, closing out or
exercise of such positions to be treated as 60% long-term and 40% short-term
capital gain or loss, although foreign currency gains or losses arising from
certain of these positions may be treated as ordinary income or loss. In
addition, the Fund generally will be required to "mark to market" (i.e., treat
as sold for fair market value) each such position which it holds at the close of
each taxable year. If a Section 1256 Contract held by the Fund at the end of a
taxable year is sold in the following year, the amount of any gain or loss
realized on such sale will be adjusted to reflect the gain or loss previously
taken into account under the "mark to market" rules. Section 1256 Contracts
include certain options contracts, certain regulated futures contracts, and
certain other financial contracts.

Notwithstanding any of the foregoing, the Fund may recognize gain (but not loss)
from a constructive sale of certain "appreciated financial positions" if the
Fund enters into a short sale, offsetting notional principal contract, or
forward contract transaction with respect to the appreciated position or
substantially identical property. Appreciated financial positions subject to
this constructive sale treatment are interests (including options and forward
contracts and short sales) in stock and certain other instruments. Constructive
sale treatment does not apply to certain transactions closed in the 90-day
period ending with the 30th day after the close of the taxable year, if certain
conditions are met.

The Code contains special rules that apply to "straddles," defined generally as
the holding of "offsetting positions with respect to personal property." For
example, the straddle rules normally apply when a taxpayer holds stock and an
offsetting option with respect to such stock or substantially identical stock or
securities. In general, investment positions will be offsetting if there is a
substantial diminution in the risk of loss from holding one position by reason
of holding one or more other positions. The Fund expects that the call options
it writes on portfolio securities will generally be "qualified covered calls"
that are exempt from the straddle rules. To meet the qualified covered call
option exemption, a stock-plus-covered-call position cannot be part of a larger
straddle and must meet a number of other conditions, including that the option
is written more than 30 days prior to expiration and is not "deep-in-the-money"
as defined in the Code. The Fund may enter into certain investments that may
constitute positions in a straddle. If two or more positions constitute a
straddle, recognition of a realized loss from one position must be deferred to
the extent of unrecognized gain in an offsetting position. In addition,
long-term capital gain may be recharacterized as short-term capital gain, or
short-term capital loss as long-term capital loss. Interest and other carrying
charges allocable to personal property that is part of a straddle are not
currently deductible but must instead be capitalized. Similarly, "wash sale"
rules apply to prevent the recognition of loss by the Fund from the disposition
of stock or securities at a loss in a case in which identical or substantially
identical stock or securities (or an option to acquire such property) is or has
been acquired within a prescribed period.

The Code allows a taxpayer to elect to offset gains and losses from positions
that are part of a "mixed straddle." A "mixed straddle" is any straddle in which
one or more but not all positions are Section 1256 Contracts. The Fund may be
eligible to elect to establish one or more mixed straddle accounts for certain
of its mixed straddle trading positions. The mixed straddle account rules
require a daily "marking to market" of all open positions in the account and a
daily netting of gains and losses from positions in the account. At the end of a
taxable year, the annual net gains or losses from the mixed straddle account are
recognized for tax purposes. The application of the mixed straddle account rules
is not entirely clear. Therefore, there is no assurance that a mixed straddle
account election by the Fund will be accepted by the Internal Revenue Service
(the "IRS").

Gain or loss from a short sale of property is generally considered as capital
gain or loss to the extent the property used to close the short sale constitutes
a capital asset in the Fund's hands. Except with

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respect to certain situations where the property used to close a short sale has
a long-term holding period on the date the short sale is entered into, gains on
short sales generally are short-term capital gains. A loss on a short sale will
be treated as a long-term capital loss if, on the date of the short sale,
"substantially identical property" has been held by the Fund for more than one
year. In addition, these rules may also terminate the running of the holding
period of "substantially identical property" held by the Fund.

Gain or loss on a short sale will generally not be realized until such time as
the short sale is closed. However, as described above in the discussion of
constructive sales, if the Fund holds a short sale position that would result in
gain if it were closed, and it then acquires property that is the same as or
substantially identical to the property sold short, the Fund generally will
recognize gain on the date it acquires such property as if the short sale were
closed on such date with such property. Similarly, if the Fund holds an
appreciated financial position with respect to securities and then enters into a
short sale with respect to the same or substantially identical property, the
Fund generally will recognize gain as if the appreciated financial position were
sold at its fair market value on the date it enters into the short sale. The
subsequent holding period for any appreciated financial position that is subject
to these constructive sale rules will be determined as if such position were
acquired on the date of the constructive sale.

The Fund intends to make regular monthly distributions to Common Shareholders
based upon its projected annual cash available from option premiums and
dividends. The Fund expects that over time it will distribute all of its
investment company taxable income. The Fund intends to distribute annually any
net capital gain (which is the excess of net long-term capital gain over net
short-term capital loss). Distributions of the Fund's net capital gain ("capital
gain distributions"), if any, are taxable to Common Shareholders as long-term
capital gain, regardless of the length of time Common Shares have been held by
Common Shareholders. All other distributions paid by the Fund (including
dividends from short-term capital gains) from its current or accumulated
earnings and profits are generally subject to tax as ordinary income. If, for
any taxable year, the total distributions exceed the Fund's current and
accumulated earnings and profits, the excess will be treated as a tax-free
return of capital to each Common Shareholder (up to the amount of the Common
Shareholder's basis in his or her Common Shares) and thereafter as gain from the
sale of Shares (assuming the Common Shares are held as a capital asset). The
amount treated as a tax-free return of capital will reduce the Common
Shareholder's adjusted basis in his or her Shares, thereby increasing his or her
potential gain or reducing his or her potential loss on the subsequent sale or
other disposition of his or her Common Shares. See below for a summary of the
maximum tax rates applicable to capital gain (including capital gain
distributions). A corporation that owns Fund shares generally will not be
entitled to the dividends received deduction with respect to all (or any
prescribed percentage) of the distributions it receives from the Fund.

Under the Jobs and Growth Tax Relief Reconciliation Act of 2003 (the "Tax Act"),
certain dividend distributions paid by the Fund (whether paid in cash or
reinvested in additional Fund shares) to individual taxpayers are taxed at rates
applicable to net long-term capital gains (15%, or 5% for individuals in the 10%
or 15% tax brackets). This tax treatment applies only if certain holding period
and other requirements are satisfied by the Common Shareholder with respect to
his or her Common Shares and the dividends are attributable to qualified
dividend income received by the Fund itself. For this purpose, "qualified
dividend income" means dividends received by the Fund from United States
corporations and "qualified foreign corporations," provided that the Fund
satisfies certain holding period and other requirements in respect of the stock
of such corporations. Dividends received on shares of stock that are subject to
a covered call option that is not a qualified covered call option, will not
constitute qualified dividend income. Gains on option positions and other
short-term gains, interest income and non-qualified dividends are not eligible
for the lower tax rate. The special rules relating to

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the taxation of ordinary income dividends paid by the Fund generally apply to
taxable years beginning before January 1, 2009. Thereafter, the Fund's
distributions that are characterized as dividends, other than capital gain
distributions, will be fully taxable at ordinary income tax rates unless further
Congressional action is taken. There can be no assurance as to what portion of
the Fund's dividend distributions will qualify for favorable treatment under the
Tax Act.

Common Shareholders receiving dividends or distributions in the form of
additional Common Shares pursuant to the Plan will be treated for U.S. federal
income tax purposes as receiving a distribution in an amount equal to the amount
of money that the shareholders receiving cash dividends or distributions will
receive, and will have a cost basis in the Common Shares received equal to such
amount. The Fund will inform Common Shareholders of the source and tax status of
all distributions promptly after the close of each calendar year.

Selling Common Shareholders will generally recognize gain or loss in an amount
equal to the difference between the Common Shareholder's adjusted tax basis in
the Common Shares sold and the amount received. If the Common Shares are held as
a capital asset, the gain or loss will be a capital gain or loss. The maximum
tax rate applicable to net capital gains recognized by individuals and other
non-corporate taxpayers is (i) the same as the maximum ordinary income tax rate
for gains recognized on the sale of capital assets held for one year or less, or
(ii) 15% for gains recognized on the sale of capital assets held for more than
one year (as well as certain capital gain distributions) (5% for individuals in
the 10% or 15% tax brackets). Any loss on a disposition of Common Shares held
for six months or less will be treated as a long-term capital loss to the extent
of any capital gain distributions received with respect to those Common Shares.
For purposes of determining whether Common Shares have been held for six months
or less, the holding period is suspended for any periods during which the Common
Shareholder's risk of loss is diminished as a result of holding one or more
other positions in substantially similar or related property, or through certain
options or short sales. Any loss realized on a sale or exchange of Common Shares
will be disallowed to the extent those Common Shares are replaced by other
Common Shares within a period of 61 days beginning 30 days before and ending 30
days after the date of disposition of the Common Shares (whether through the
reinvestment of distributions, which could occur, for example, if the Common
Shareholder is a participant in the Plan (as defined below) or otherwise). In
that event, the basis of the replacement Common Shares will be adjusted to
reflect the disallowed loss.

An investor should be aware that, if Common Shares are purchased shortly before
the record date for any taxable distribution (including a capital gain
distribution), the purchase price likely will reflect the value of the
distribution and the investor then would receive a taxable distribution likely
to reduce the trading value of such Common Shares, in effect resulting in a
taxable return of some of the purchase price.

The Fund may be required to withhold, for U.S. federal backup withholding tax
purposes, a portion of the dividends, distributions and redemption proceeds
payable to Common Shareholders who fail to provide the Fund (or its agent) with
their correct taxpayer identification number or to make required certifications,
or who have been notified by the IRS that they are subject to backup
withholding. Certain Common Shareholders are exempt from backup withholding.
Backup withholding is not an additional tax and any amount withheld may be
credited against a Common Shareholder's U.S. federal income tax liability.

An investor should also be aware that the benefits of the reduced tax rate
applicable to long-term capital gains and qualified dividend income may be
impacted by the application of the alternative minimum tax to individual
shareholders.

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The foregoing briefly summarizes some of the important federal income tax
consequences to Common Shareholders of investing in Common Shares, reflects the
federal tax law as of the date of this Prospectus, and does not address special
tax rules applicable to certain types of investors, such as corporate and
foreign investors. Unless otherwise noted, this discussion assumes that an
investor is a U.S. person and holds Common Shares as a capital asset. This
discussion is based upon current provisions of the Code, the regulations
promulgated thereunder, and judicial and administrative ruling authorities, all
of which are subject to change or differing interpretations by the courts or the
IRS retroactively or prospectively. Investors should consult their tax advisors
regarding the federal, state or local tax considerations that may be applicable
in their particular circumstances.

Dividend reinvestment plan

Pursuant to the Fund's dividend reinvestment plan (the "Plan"), a Common
Shareholder may elect to have all distributions (including all capital gain
dividends) automatically reinvested in Common Shares. Common Shareholders may
elect to participate in the Plan by completing the dividend reinvestment plan
application form. Common Shareholders electing not to participate in the Plan
will receive all distributions in cash paid by check mailed directly to them by
PFPC Inc., as dividend paying agent.

PFPC Inc. (the "Plan Agent") serves as agent for the Common Shareholders in
administering the Plan. Common Shareholders who elect not to participate in the
Plan will receive all Fund distributions in cash paid by check mailed directly
to the Common Shareholder of record (or if the Common Shares are held in street
or other nominee name, then to the nominee) by PFPC Inc., as disbursing agent.
Participation in the Plan is completely voluntary and may be terminated or
resumed at any time without penalty by written notice if received by the Plan
Agent prior to any distribution record date.

Common Shares will be acquired by the Plan Agent or an independent broker-dealer
for the participants' accounts, depending upon the circumstances described
below, either (i) through receipt of additional previously authorized but
unissued Common Shares from the Fund ("newly issued Common Shares") or (ii) by
purchase of outstanding Common Shares on the open market ("open-market
purchases") on the New York Stock Exchange or elsewhere. If, on the payment date
for the distribution, the net asset value per Common Share is equal to or less
than the market price per Common Share plus estimated brokerage commissions
(such condition being referred to herein as "market premium"), the Plan Agent
will invest the distribution amount in newly issued Common Shares on behalf of
the participants. The number of newly issued Common Shares to be credited to
each participant's account will be determined by dividing the dollar amount of
the distribution by the net asset value per Common Share on the date the Common
Shares are issued, provided that the maximum discount from the then current
market price per Common Share on the date of issuance may not exceed 5%. If on
the distribution payment date the net asset value per Common Share is greater
than the market value plus estimated brokerage commissions (such condition being
referred to herein as "market discount"), the Plan Agent will invest the
distribution amount in Common Shares acquired on behalf of the participants in
open-market purchases.

In the event of a market discount on the distribution payment date, the Plan
Agent will have up to 30 days after the distribution payment date to invest the
distribution amount in Common Shares acquired in open-market purchases. If,
before the Plan Agent has completed its open-market purchases, the market price
of a Common Share exceeds the net asset value per Common Share, the average per
Common Share purchase price paid by the Plan Agent may exceed the net asset
value of the Fund's Common Shares, resulting in the acquisition of fewer Common
Shares than if the distribution had been paid in newly issued Common Shares on
the distribution payment date. Therefore, the Plan provides that if the Plan
Agent is unable to invest the full distribution amount in open-market purchases
during the purchase period or if the market discount shifts to a market premium
during the

--------------------------------------------------------------------------------
 38
<PAGE>
DIVIDEND REINVESTMENT PLAN
--------------------------------------------------------------------------------

purchase period, the Plan Agent will cease making open-market purchases and will
invest the uninvested portion of the distribution amount in newly issued Common
Shares.

The Plan Agent maintains all Common Shareholders' accounts in the Plan and
furnishes written confirmation of all transactions in the accounts, including
information needed by Common Shareholders for tax records. Common Shares in the
account of each Plan participant will be held by the Plan Agent on behalf of the
Plan participant, and each Common Shareholder proxy will include those Common
Shares purchased or received pursuant to the Plan. The Plan Agent will forward
all proxy solicitation materials to participants and vote proxies for Common
Shares held pursuant to the Plan in accordance with the instructions of the
participants. In the case of Common Shareholders such as banks, brokers or
nominees that hold Common Shares for others who are the beneficial owners, the
Plan Agent will administer the Plan on the basis of the number of Common Shares
certified from time to time by the record Common Shareholder's name and held for
the account of beneficial owners who participate in the Plan.

There will be no brokerage charges with respect to Common Shares issued directly
by the Fund as a result of distributions payable either in Common Shares or in
cash. However, each participant will pay a pro rata share of brokerage
commissions incurred with respect to the Plan Agent's open-market purchases in
connection with the reinvestment of distributions.

Common Shareholders participating in the Plan may receive benefits not available
to Common Shareholders not participating in the Plan. If the market price (plus
commissions) of the Fund's Common Shares is above their net asset value,
participants in the Plan will receive Common Shares of the Fund at less than
they could otherwise purchase them and will have Common Shares with a cash value
greater than the value of any cash distribution they would have received on
their Common Shares. If the market price plus commissions is below the net asset
value, participants will receive distributions in Common Shares with a net asset
value greater than the per Common Share value of any cash distribution they
would have received on their Common Shares. However, there may be insufficient
Common Shares available in the market to make distributions in Common Shares at
prices below the net asset value. Also, since the Fund does not redeem its
Common Shares, the price on resale may be more or less than the net asset value.

Experience under the Plan may indicate that changes are desirable. Accordingly,
upon 30 days' notice to Plan participants, the Fund reserves the right to amend
or terminate the Plan. A Plan participant will be charged a $5.00 service charge
and pay brokerage charges whenever he or she directs the Plan Agent to sell
Common Shares held in a dividend reinvestment account.

All correspondence concerning the Plan should be directed to the Plan Agent at
PFPC Inc., P.O. Box 43027, Providence, Rhode Island 02940-3027. Please call
1-800-331-1710 between the hours of 9:00 a.m. and 5:00 p.m. Eastern Standard
Time if you have questions regarding the Plan.

Description of capital structure

The Fund is an unincorporated business trust established under the laws of The
Commonwealth of Massachusetts by an Agreement and Declaration of Trust dated
November 8, 2004 and filed with the Secretary of The Commonwealth on November 9,
2004 (the "Declaration of Trust"). The Declaration of Trust provides that the
Board may authorize separate classes of shares of beneficial interest. The Board
has authorized an unlimited number of Common Shares. The Fund intends to hold
annual meetings of Common Shareholders in compliance with the requirements of
the New York Stock Exchange.

--------------------------------------------------------------------------------
                                                                              39
<PAGE>
DESCRIPTION OF CAPITAL STRUCTURE
--------------------------------------------------------------------------------

COMMON SHARES

The Declaration of Trust permits the Fund to issue an unlimited number of full
and fractional common shares of beneficial interest, $0.01 par value per share.
Each Common Share represents an equal proportionate interest in the assets of
the Fund with each other Common Share in the Fund. Holders of Common Shares will
be entitled to the payment of distributions when, as and if declared by the
Board. The 1940 Act or the terms of any future borrowings or issuance of
preferred shares may limit the payment of distributions to the holders of Common
Shares. Each whole Common Share shall be entitled to one vote as to matters on
which it is entitled to vote pursuant to the terms of the Declaration of Trust
on file with the SEC. Upon liquidation of the Fund, after paying or adequately
providing for the payment of all liabilities of the Fund and the liquidation
preference with respect to any outstanding preferred shares, and upon receipt of
such releases, indemnities and refunding agreements as they deem necessary for
their protection, the Board may distribute the remaining assets of the Fund
among the holders of the Common Shares. The Declaration of Trust provides that
Common Shareholders are not liable for any liabilities of the Fund, and permits
inclusion of a clause to that effect in agreements entered into by the Fund and
in coordination with the Fund's By-laws indemnifies shareholders against any
such liability. Although shareholders of an unincorporated business trust
established under Massachusetts law, in certain limited circumstances, may be
held personally liable for the obligations of the business trust as though they
were general partners, the provisions of the Fund's Declaration of Trust and
By-laws described in the foregoing sentence make the likelihood of such personal
liability remote.

The Fund has no current intention to issue preferred shares or to borrow money.
However, if at some future time, there are any borrowings or preferred shares
outstanding, the Fund may not be permitted to declare any cash distribution on
its Common Shares, unless at the time of such declaration, (i) all accrued
distributions on preferred shares or accrued interest on borrowings have been
paid and (ii) the value of the Fund's total assets (determined after deducting
the amount of such distribution), less all liabilities and indebtedness of the
Fund not represented by senior securities, is at least 300% of the aggregate
amount of such securities representing indebtedness and at least 200% of the
aggregate amount of securities representing indebtedness plus the aggregate
liquidation value of the outstanding preferred shares (expected to equal the
aggregate original purchase price of the outstanding preferred shares plus
redemption premium, if any, together with any accrued and unpaid distributions
thereon, whether or not earned or declared and on a cumulative basis). In
addition to the requirements of the 1940 Act, the Fund may be required to comply
with other asset coverage requirements as a condition of the Fund obtaining a
rating of preferred shares from a nationally recognized statistical rating
agency (a "Rating Agency"). These requirements may include an asset coverage
test more stringent than under the 1940 Act. This limitation on the Fund's
ability to make distributions on its Common Shares could in certain
circumstances impair the ability of the Fund to maintain its qualification for
taxation as a regulated investment company for federal income tax purposes. If
the Fund were in the future to issue preferred shares or borrow money, it would
intend, however, to the extent possible to purchase or redeem preferred shares
or reduce borrowings from time to time to maintain compliance with such asset
coverage requirements and may pay special distributions to the holders of the
preferred shares in certain circumstances in connection with any potential
impairment of the Fund's status as a regulated investment company. See
"Distributions-Federal income tax matters." Depending on the timing of any such
redemption or repayment, the Fund may be required to pay a premium in addition
to the liquidation preference of the preferred shares to the holders thereof.

The Fund has no present intention of offering additional Common Shares, except
as described herein. Other offerings of its Common Shares, if made, will require
approval of the Board. Any additional offering will not be sold at a price per
Common Share below the then current net asset value (exclusive of underwriting
discounts and commissions) except in connection with an offering to

--------------------------------------------------------------------------------
 40
<PAGE>
DESCRIPTION OF CAPITAL STRUCTURE
--------------------------------------------------------------------------------

existing Common Shareholders or with the consent of a majority of the Fund's
outstanding Common Shares. The Common Shares have no preemptive rights.

The Fund generally will not issue Common Share certificates. However, upon
written request to the Fund's transfer agent, a share certificate will be issued
for any or all of the full Common Shares credited to an investor's account.
Common Share certificates that have been issued to an investor may be returned
at any time.

REPURCHASE OF COMMON SHARES AND OTHER DISCOUNT MEASURES

Because shares of closed-end management investment companies frequently trade at
a discount to their net asset values, the Board has determined that from time to
time it may be in the interest of Common Shareholders for the Fund to take
corrective actions. The Board, in consultation with Eaton Vance, will review at
least annually the possibility of open market repurchases and/or tender offers
for the Common Shares and will consider such factors as the market price of the
Common Shares, the net asset value of the Common Shares, the liquidity of the
assets of the Fund, the effect on the Fund's expenses, whether such transactions
would impair the Fund's status as a regulated investment company or result in a
failure to comply with applicable asset coverage requirements, general economic
conditions and such other events or conditions, which may have a material effect
on the Fund's ability to consummate such transactions. There are no assurances
that the Board will, in fact, decide to undertake either of these actions or, if
undertaken, that such actions will result in the Common Shares trading at a
price equal to or approximates their net asset value. In recognition of the
possibility that the Common Shares might trade at a discount to net asset value
and that any such discount may not be in the interest of Common Shareholders,
the Board, in consultation with Eaton Vance, from time to time may review
possible actions to reduce any such discount.

PREFERRED SHARES

The Fund has no current intention of issuing any shares other than the Common
Shares. However, the Declaration of Trust authorizes the issuance of an
unlimited number of shares of beneficial interest with preference rights (the
"preferred shares") in one or more series, with rights as determined by the
Board, by action of the Board without the approval of the Common Shareholders.

Under the requirements of the 1940 Act, the Fund must, immediately after the
issuance of any preferred shares, have an "asset coverage" of at least 200%.
Asset coverage means the ratio which the value of the total assets of the Fund,
less all liability and indebtedness not represented by senior securities (as
defined in the 1940 Act), bears to the aggregate amount of senior securities
representing indebtedness of the Fund, if any, plus the aggregate liquidation
preference of the preferred shares. If the Fund seeks a rating of preferred
shares, asset coverage requirements, in addition to those set forth in the 1940
Act, may be imposed. The liquidation value of any preferred shares would be
expected to equal their aggregate original purchase price plus redemption
premium, if any, together with any accrued and unpaid distributions thereon (on
a cumulative basis), whether or not earned or declared. The terms of any
preferred shares, including their distribution rate, voting rights, liquidation
preference and redemption provisions, will be determined by the Board (subject
to applicable law and the Fund's Declaration of Trust) if and when it authorizes
preferred shares. The Fund may issue preferred shares that provide for the
periodic redetermination of the dividend rate at relatively short intervals
through an auction or remarketing procedure, although the terms of such
preferred shares may also enable the Fund to lengthen such intervals. At times,
the distribution rate as redetermined on any preferred shares could approach or
exceed the Fund's return after expenses on the investment of proceeds from the
preferred shares and the Fund's leveraged capital structure would result in a
lower rate of return to Common Shareholders than if the Fund were not so
structured.

--------------------------------------------------------------------------------
                                                                              41
<PAGE>
DESCRIPTION OF CAPITAL STRUCTURE
--------------------------------------------------------------------------------

In the event of any voluntary or involuntary liquidation, dissolution or winding
up of the Fund, the terms of any preferred shares may entitle the holders of
preferred shares to receive a preferential liquidating distribution (expected to
equal the original purchase price per share plus redemption premium, if any,
together with accrued and unpaid dividends, whether or not earned or declared
and on a cumulative basis) before any distribution of assets is made to holders
of Common Shares. After payment of the full amount of the liquidating
distribution to which they are entitled, the preferred shareholders would not be
entitled to any further participation in any distribution of assets by the Fund.
Holders of preferred shares, voting as a class, shall be entitled to elect two
of the Fund's Trustees, if any preferred shares are issued. Under the 1940 Act,
if at any time dividends on the preferred shares are unpaid in an amount equal
to two full years' dividends thereon, the holders of all outstanding preferred
shares, voting as a class, will be allowed to elect a majority of the Board
until all dividends in default have been paid or declared and set apart for
payment. In addition, if required by a Rating Agency rating the preferred shares
or if the Board determines it to be in the best interests of the Common
Shareholders, issuance of the preferred shares may result in more restrictive
provisions than required by the 1940 Act being imposed. In this regard, holders
of the preferred shares may be entitled to elect a majority of the Fund's Board
in other circumstances, for example, if one payment on the preferred shares is
in arrears.

In the event of any future issuance of preferred shares, the Fund likely would
seek a credit rating for such preferred shares from a Rating Agency. In such
event, as long as preferred shares are outstanding, the composition of its
portfolio will reflect guidelines established by such Rating Agency. Based on
previous guidelines established by such Rating Agencies for the securities of
other issuers, the Fund anticipates that the guidelines with respect to any
preferred shares would establish a set of tests for portfolio composition and
asset coverage that supplement (and in some cases are more restrictive than) the
applicable requirements under the 1940 Act. Although, at this time, no assurance
can be given as to the nature or extent of the guidelines, which may be imposed
in connection with obtaining a rating of any preferred shares, the Fund
anticipates that such guidelines would include asset coverage requirements that
are more restrictive than those under the 1940 Act, restrictions on certain
portfolio investments and investment practices, requirements that the Fund
maintain a portion of its assets in short-term, high-quality, fixed-income
securities and certain mandatory redemption requirements relating to any
preferred shares. No assurance can be given that the guidelines actually imposed
with respect to any preferred shares by such Rating Agency would be more or less
restrictive than as described in this Prospectus.

CREDIT FACILITY/COMMERCIAL PAPER PROGRAM

The Fund has no current intention to borrow money for the purpose of obtaining
investment leverage. In the event the Fund in the future determines to engage in
investment leverage, in whole or in part, through borrowings, the Fund may enter
into definitive agreements with respect to a credit facility/ commercial paper
program or other borrowing program. The Fund may negotiate with commercial banks
to arrange a credit facility/commercial paper program pursuant to which the Fund
would expect to be entitled to borrow up to a specified amount. Any such
borrowings would constitute financial leverage. Such a facility/commercial paper
program would not be expected to be convertible into any other securities of the
Fund, outstanding amounts would be expected to be prepayable by the Fund prior
to final maturity without significant penalty and there are not expected to be
any sinking fund or mandatory retirement provisions. Outstanding amounts would
be payable at maturity or such earlier times as required by the agreement. The
Fund may be required to prepay outstanding amounts under the facility/program or
incur a penalty rate of interest in the event of the occurrence of certain
events of default. The Fund would be expected to indemnify the lenders under the
facility/program against liabilities they may incur in connection with the
facility/program.

--------------------------------------------------------------------------------
 42
<PAGE>
DESCRIPTION OF CAPITAL STRUCTURE
--------------------------------------------------------------------------------

In addition, the Fund expects that any such credit facility/program would
contain covenants that, among other things, likely would limit the Fund's
ability to pay distributions in certain circumstances, incur additional debt,
change its fundamental investment policies and engage in certain transactions,
including mergers and consolidations, and may require asset coverage ratios in
addition to those required by the 1940 Act. The Fund may be required to pledge
its assets and to maintain a portion of its assets in cash or high-grade
securities as a reserve against interest or principal payments and expenses. The
Fund expects that any credit facility/program would have customary covenant,
negative covenant and default provisions. There can be no assurance that the
Fund will enter into an agreement for a credit facility/program on terms and
conditions representative of the foregoing, or that additional material terms
will not apply. In addition, if entered into, any such credit facility/program
may in the future be replaced or refinanced by one or more credit facilities
having substantially different terms or by the issuance of preferred shares or
debt securities.

EFFECTS OF POSSIBLE FUTURE LEVERAGE

As discussed above, the Fund has no current intention to issue preferred shares
or to borrow money for the purpose of obtaining investment leverage. In the
event that the Fund determines in the future to utilize investment leverage,
there can be no assurance that such a leveraging strategy would be successful
during any period in which it is employed. Leverage creates risks for Common
Shareholders, including the likelihood of greater volatility of net asset value
and market price of the Common Shares and the risk that fluctuations in
distribution rates on any preferred shares or fluctuations in borrowing costs
may affect the return to Common Shareholders. To the extent the amounts
available for distribution derived from securities purchased with proceeds
received from leverage exceed the cost of leverage, the Fund's distributions
would be greater than if leverage had not been used. Conversely, if the amounts
available for distribution derived from securities purchased with such proceeds
are not sufficient to cover the cost of leverage, distributions to Common
Shareholders would be less than if leverage had not been used. In the latter
case, Eaton Vance, in its best judgment, may nevertheless determine to maintain
the Fund's leveraged position if it deems such action to be appropriate. The
costs of an offering of preferred shares and/or a borrowing program would be
borne by Common Shareholders and consequently would result in a reduction of the
net asset value of Common Shares.

In addition, the fee paid to Eaton Vance will be calculated on the basis of the
Fund's average daily gross assets, including proceeds from the issuance of
preferred shares and/or borrowings, so the fees would be higher if leverage is
utilized. In this regard, holders of preferred shares would not bear the
investment advisory fee. Rather, Common Shareholders would bear the portion of
the investment advisory fee attributable to the assets purchased with the
proceeds of the preferred shares offering.

ANTI-TAKEOVER PROVISIONS IN THE DECLARATION OF TRUST

The Declaration of Trust includes provisions that could have the effect of
limiting the ability of other entities or persons to acquire control of the Fund
or to change the composition of its Board and could have the effect of depriving
Common Shareholders of an opportunity to sell their Common Shares at a premium
over prevailing market prices by discouraging a third party from seeking to
obtain control of the Fund. These provisions may have the effect of discouraging
attempts to acquire control of the Fund, which attempts could have the effect of
increasing the expenses of the Fund and interfering with the normal operation of
the Fund. The Board is divided into three classes, with the term of one class
expiring at each annual meeting of Common Shareholders. At each annual meeting,
one class of Trustees is elected to a three-year term. This provision could
delay for up to two years the replacement of a majority of the Board. A Trustee
may be removed from office only for cause by a written instrument signed by the
remaining Trustees or by a vote of the holders of at least two-thirds of the
class of shares of the Fund that elected such Trustee and are entitled to vote
on the matter.

--------------------------------------------------------------------------------
                                                                              43
<PAGE>
DESCRIPTION OF CAPITAL STRUCTURE
--------------------------------------------------------------------------------

In addition, the Declaration of Trust requires the favorable vote of the holders
of at least 75% of the outstanding shares of each class of the Fund, voting as a
class, then entitled to vote to approve, adopt or authorize certain transactions
with 5%-or-greater holders of a class of shares and their associates, unless the
Board shall by resolution have approved a memorandum of understanding with such
holders, in which case normal voting requirements would be in effect. For
purposes of these provisions, a 5%-or-greater holder of a class of shares (a
"Principal Shareholder") refers to any person who, whether directly or
indirectly and whether alone or together with its affiliates and associates,
beneficially owns 5% or more of the outstanding shares of any class of
beneficial interest of the Fund. The transactions subject to these special
approval requirements are: (i) the merger or consolidation of the Fund or any
subsidiary of the Fund with or into any Principal Shareholder; (ii) the issuance
of any securities of the Fund to any Principal Shareholder for cash; (iii) the
sale, lease or exchange of all or any substantial part of the assets of the Fund
to any Principal Shareholder (except assets having an aggregate fair market
value of less than $1,000,000, aggregating for the purpose of such computation
all assets sold, leased or exchanged in any series of similar transactions
within a twelve-month period); or (iv) the sale, lease or exchange to the Fund
or any subsidiary thereof, in exchange for securities of the Fund, of any assets
of any Principal Shareholder (except assets having an aggregate fair market
value of less than $1,000,000, aggregating for the purposes of such computation
all assets sold, leased or exchanged in any series of similar transactions
within a twelve-month period).

The Board has determined that provisions with respect to the Board and the 75%
voting requirements described above, which voting requirements are greater than
the minimum requirements under Massachusetts law or the 1940 Act, are in the
best interest of Common Shareholders generally. Reference should be made to the
Declaration of Trust on file with the SEC for the full text of these provisions.

CONVERSION TO OPEN-END FUND

The Fund may be converted to an open-end management investment company at any
time if approved by the lesser of (i) two-thirds or more of the Fund's then
outstanding Common Shares and preferred shares (if any), each voting separately
as a class, or (ii) more than 50% of the then outstanding Common Shares and
preferred shares (if any), voting separately as a class if such conversion is
recommended by at least 75% of the Trustees then in office. If approved in the
foregoing manner, conversion of the Fund could not occur until 90 days after the
shareholders' meeting at which such conversion was approved and would also
require at least 30 days' prior notice to all shareholders. Conversion of the
Fund to an open-end management investment company also would require the
redemption of any outstanding preferred shares and could require the repayment
of borrowings, which would eliminate any future leveraged capital structure of
the Fund with respect to the Common Shares. In the event of conversion, the
Common Shares would cease to be listed on the New York Stock Exchange or other
national securities exchange or market system. The Board believes that the
closed-end structure is desirable, given the Fund's investment objectives and
policies. Investors should assume, therefore, that it is unlikely that the Board
would vote to convert the Fund to an open-end management investment company.
Shareholders of an open-end management investment company may require the
company to redeem their shares at any time (except in certain circumstances as
authorized by or under the 1940 Act) at their net asset value, less such
redemption charge, if any, as might be in effect at the time of a redemption. If
the Fund were to convert to an open-end investment company, the Fund expects it
would pay all such redemption requests in cash, but would likely reserve the
right to pay redemption requests in a combination of cash or securities. If such
partial payment in securities were made, investors may incur brokerage costs in
converting such securities to cash. If the Fund were converted to an open-end
fund, it is likely that new Common Shares would be sold at net asset value plus
a sales load.

--------------------------------------------------------------------------------
 44
<PAGE>

--------------------------------------------------------------------------------

Underwriting

The underwriters named below (the "Underwriters"), acting through UBS Securities
LLC, 299 Park Avenue, New York, New York, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, 4 World Financial Center, New York, New York, and Wachovia Capital
Markets, LLC, 7 St. Paul Street, 1st Floor, Baltimore, Maryland, as lead
managers and A.G. Edwards & Sons, Inc., H&R Block Financial Advisors, Inc.,
J.J.B. Hilliard, W.L. Lyons, Inc., Oppenheimer & Co. Inc., Raymond James &
Associates, Inc., RBC Capital Markets Corporation and Wells Fargo Securities,
LLC, as their representatives (together with the lead managers, the
"Representatives"), have severally agreed, subject to the terms and conditions
of the Underwriting Agreement with the Fund, Eaton Vance and Rampart (the
"Underwriting Agreement"), to purchase from the Fund the number of Common Shares
set forth opposite their respective names. The Underwriters are committed to
purchase and pay for all of such Common Shares (other than those covered by the
over-allotment option described below) if any are purchased.

<Table>
<Caption>
                                                                NUMBER OF
                        UNDERWRITERS                          COMMON SHARES
---------------------------------------------------------------------------
<S>                                                           <C>
UBS Securities LLC..........................................
Merrill Lynch, Pierce, Fenner & Smith
             Incorporated...................................
Wachovia Capital Markets, LLC...............................
A.G. Edwards & Sons, Inc. ..................................
H&R Block Financial Advisors, Inc. .........................
J.J.B. Hilliard, W.L. Lyons, Inc. ..........................
Oppenheimer & Co. Inc. .....................................
Raymond James & Associates, Inc. ...........................
RBC Capital Markets Corporation.............................
Wells Fargo Securities, LLC.................................
                                                              -------------
  Total.....................................................
                                                              =============
</Table>

The Fund has granted to the Underwriters an option, exercisable for 45 days from
the date of this Prospectus, to purchase up to an additional           Common
Shares to cover over-allotments, if any, at the initial offering price. The
Underwriters may exercise such option solely for the purpose of covering
underwriting over-allotments incurred in the sale of the Common Shares offered
hereby. To the extent that the Underwriters exercise this option, each of the
Underwriters will have a firm commitment, subject to certain conditions, to
purchase an additional number of Common Shares proportionate to such
Underwriter's initial commitment.

The Fund has agreed to pay a commission to the Underwriters in the amount of
$0.90 per Common Share (4.50% of the public offering price per Common Share).
The Representatives have advised the Fund that the Underwriters may pay up to
$     per Common Share from such commission to selected dealers who sell the
Common Shares and that such dealers may reallow a concession of up to $     per
Common Share to certain other dealers who sell Common Shares. Eaton Vance or an
affiliate has agreed to (i) reimburse all organizational costs and (ii) pay all
offering costs of the Fund (other than sales loads) that exceed $0.04 per Common
Share. Investors must pay for any Common Shares purchased on or before
          , 2005.

Prior to this offering, there has been no public market for the Common Shares or
any other securities of the Fund. Consequently, the offering price for the
Common Shares was determined by negotiation

--------------------------------------------------------------------------------
                                                                              45
<PAGE>
UNDERWRITING
--------------------------------------------------------------------------------

among the Fund and the Representatives. There can be no assurance, however, that
the price at which Common Shares sell after this offering will not be lower than
the price at which they are sold by the Underwriters or that an active trading
market in the Common Shares will develop and continue after this offering. The
minimum investment requirement is 100 Common Shares ($2,000).

The Fund, Eaton Vance and Rampart have each agreed to indemnify the several
Underwriters for or to contribute to the losses arising out of certain
liabilities, including liabilities under the Securities Act of 1933, as amended.

The Fund has agreed not to offer, sell or register with the Securities and
Exchange Commission any additional equity securities of the Fund, other than
issuances of Common Shares, including pursuant to the Fund's Plan, and issuances
in connection with any preferred shares, each as contemplated in this
Prospectus, for a period of 180 days after the date of the Underwriting
Agreement without the prior written consent of the Representatives.

The Representatives have informed the Fund that the Underwriters do not intend
to confirm sales to any accounts over which they exercise discretionary
authority.

In connection with this offering, the Underwriters may purchase and sell Common
Shares in the open market. These transactions may include over-allotment and
stabilizing transactions and purchases to cover syndicate short positions
created in connection with this offering. Stabilizing transactions consist of
certain bids or purchases for the purpose of preventing or retarding a decline
in the market price of the Common Shares and syndicate short positions involve
the sale by the Underwriters of a greater number of Common Shares than they are
required to purchase from the Fund in this offering. The Underwriters also may
impose a penalty bid, whereby selling concessions allowed to syndicate members
or other broker-dealers in respect of the Common Shares sold in this offering
for their account may be reclaimed by the syndicate if such Common Shares are
repurchased by the syndicate in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
Common Shares, which may be higher than the price that might otherwise prevail
in the open market; and these activities, if commenced, may be discontinued at
any time without notice. These transactions may be effected on the New York
Stock Exchange or otherwise.

The Fund anticipates that the Representatives and certain other Underwriters may
from time to time act as brokers or dealers in connection with the execution of
its portfolio transactions after they have ceased to be Underwriters and,
subject to certain restrictions, may act as such brokers while they are
Underwriters.

In connection with the offering, certain of the Underwriters or selected dealers
may distribute prospectuses electronically.

Eaton Vance (and not the Fund) has agreed pursuant to an additional compensation
agreement (the "Additional Compensation Agreement") to pay to certain qualifying
Underwriters who meet specified sales targets ("Qualifying Underwriters"),
quarterly in arrears, an annual fee of up to 0.15% of the Fund's average daily
gross assets attributable to Common Shares sold by such Qualifying Underwriters
(including a proportionate share of assets that may in the future be acquired
using leverage). Such sales targets may be waived or lowered with respect to any
Underwriter in the sole discretion of Eaton Vance. These fee payments will
remain in effect only so long as the Advisory Agreement remains in effect
between the Fund and Eaton Vance or any successor in interest or affiliate of
Eaton Vance, as and to the extent that such Advisory Agreement is renewed
periodically in accordance with the 1940 Act. The sum of the additional
compensation payable to the Qualifying Underwriters will not exceed      % of
the aggregate initial offering price of the Common Shares offered hereby.
will receive additional compensation which will not exceed      % of the
aggregate initial offering price of the Common Shares offered hereby.

--------------------------------------------------------------------------------
 46
<PAGE>
UNDERWRITING
--------------------------------------------------------------------------------

Pursuant to a shareholder servicing agreement (the "Shareholder Servicing
Agreement") between UBS Securities LLC (the "Shareholder Servicing Agent") and
Eaton Vance, the Shareholder Servicing Agent will (i) at the request of and as
specified by Eaton Vance, undertake to make available public information
pertaining to the Fund on an ongoing basis and to communicate to investors and
prospective investors the Fund's features and benefits (including arranging
periodic seminars or conference calls for Eaton Vance to communicate to
investors, responding to questions from current or prospective shareholders and
contacting specific shareholders, where appropriate), provided that services
shall not include customary market research information provided by the
Shareholder Servicing Agent or its registered broker-dealer affiliates in the
ordinary course of their business; (ii) at the request of and as specified by
Eaton Vance, make available to investors and prospective investors market price,
net asset value, yield and other information regarding the Fund (provided that
services shall not include customary market research information provided by the
Shareholder Servicing Agent or its registered broker-dealer affiliates in the
ordinary course of their business), if reasonably obtainable, for the purpose of
maintaining the visibility of the Fund in the investor community; (iii) at the
request of Eaton Vance or the Fund, provide certain economic research and
statistical information and reports, if reasonably obtainable, to Eaton Vance or
the Fund and consult with representatives of Eaton Vance and/or the Board in
connection therewith, which information and reports shall include: (a)
statistical and financial market information with respect to the Fund's market
performance; and (b) comparative information regarding the Fund and other
closed-end management investment companies with respect to (1) the net asset
value of their respective shares, (2) the respective market performance of the
Fund and such other companies, and (3) other relevant performance indicators.
Except as legally required, such information and reports may not be quoted or
referred to, orally or in writing, reproduced or disseminated by the Fund or any
of its affiliates or any of their agents, without the prior written consent of
the Shareholder Servicing Agent, which consent will not be unreasonably
withheld; and (iv) at the request of Eaton Vance or the Fund, provide
information to and consult with Eaton Vance and/or the Board with respect to
applicable strategies designed to address market value discounts, which may
include share repurchases, tender offers, modifications to dividend policies or
capital structure, repositioning or restructuring of the Fund, conversion of the
Fund to an open-end investment company, liquidation or merger; including
providing information concerning the use and impact of the above strategic
alternatives by other market participants; provided, however, that under the
terms of the Shareholder Servicing Agreement, the Shareholder Servicing Agent is
not obligated to render any opinions, valuations or recommendations of any kind
or to perform any such similar services. For these services, Eaton Vance will
pay the Shareholder Servicing Agent a fee computed daily and payable quarterly
equal, on an annual basis, to 0.10% of the Fund's average daily gross assets.
The total of all of the payments payable to the Shareholder Servicing Agent
under the Shareholder Servicing Agreement will not exceed      % of the
aggregate initial offering price of the Common Shares offered hereby. Under the
terms of the Shareholder Servicing Agreement, the Shareholder Servicing Agent is
relieved from liability to Eaton Vance, or the Fund for any act or omission to
act in the course of its performance under the Shareholder Servicing Agreement
in the absence of bad faith, gross negligence or willful misconduct on the part
of the Shareholder Servicing Agent. The Shareholder Servicing Agreement will
continue so long as the Advisory Agreement remains in effect between the Fund
and the Adviser or any successor in interest or affiliate of the Adviser, as and
to the extent that such Advisory Agreement is renewed periodically in accordance
with the 1940 Act.

The total compensation received by the Underwriters will not exceed 9.00% of the
aggregate initial offering price of the Common Shares offered hereby.

--------------------------------------------------------------------------------
                                                                              47
<PAGE>

--------------------------------------------------------------------------------

Shareholder Servicing Agent, custodian and transfer agent

As described above under "Underwriting," UBS Securities LLC will provide
shareholder services to the Fund pursuant to the Shareholder Servicing Agreement
with Eaton Vance.

Investors Bank & Trust Company ("IBT"), 200 Clarendon Street, Boston,
Massachusetts 02116 is the custodian of the Fund and will maintain custody of
the securities and cash of the Fund. IBT maintains the Fund's general ledger and
computes net asset value per share daily. IBT also attends to details in
connection with the sale, exchange, substitution, transfer and other dealings
with the Fund's investments and receives and disburses all funds. IBT also
assists in preparation of shareholder reports and the electronic filing of such
reports with the SEC.

PFPC Inc., P.O. Box 43027, Providence, Rhode Island 02940-3027 is the transfer
agent and dividend disbursing agent of the Fund.

Legal opinions

Certain legal matters in connection with the Common Shares will be passed upon
for the Fund by Kirkpatrick & Lockhart LLP, Boston, Massachusetts, and for the
Underwriters by Skadden, Arps, Slate, Meagher & Flom LLP, Chicago, Illinois.

Reports to shareholders

The Fund will send to Common Shareholders unaudited semi-annual and audited
annual reports, including a list of investments held.

Independent registered public accounting firm

Deloitte & Touche, LLP, Boston, Massachusetts are the independent registered
public accounting firm for the Fund and will audit the Fund's financial
statements.

Additional information

The Prospectus and the Statement of Additional Information do not contain all of
the information set forth in the Registration Statement that the Fund has filed
with the SEC. The complete Registration Statement may be obtained from the SEC
upon payment of the fee prescribed by its rules and regulations. The Statement
of Additional Information can be obtained without charge by calling 1-800-
225-6265.

Statements contained in this Prospectus as to the contents of any contract or
other documents referred to are not necessarily complete, and, in each instance,
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement of which this Prospectus forms a part,
each such statement being qualified in all respects by such reference.

--------------------------------------------------------------------------------
 48
<PAGE>

--------------------------------------------------------------------------------

Table of contents for the
Statement of Additional Information

<Table>
<S>                                                           <C>
Additional investment information and restrictions..........    2
Trustees and officers.......................................    7
Investment advisory and other services......................   15
Determination of net asset value............................   18
Portfolio trading...........................................   20
Taxes.......................................................   22
Other information...........................................   27
Independent registered public accounting firm...............   27
Statement of assets and liabilities.........................   29
Notes to financial statements...............................   30
</Table>

The Fund's privacy policy

The Fund is committed to ensuring your financial privacy. This notice is being
sent to comply with privacy regulations of the Securities and Exchange
Commission. The Fund has in effect the following policy with respect to
nonpublic personal information about its customers:

- Only such information received from you, through application forms or
  otherwise, and information about your Fund transactions will be collected.

- None of such information about you (or former customers) will be disclosed to
  anyone, except as permitted by law (which includes disclosure to employees
  necessary to service your account).

- Policies and procedures (including physical, electronic and procedural
  safeguards) are in place that are designed to protect the confidentiality of
  such information.

For more information about the Fund's privacy policies call 1-800-262-1122.

--------------------------------------------------------------------------------
                                                                              49
<PAGE>

                               [EATON VANCE LOGO]

                                                                     CE-EEIFIIRH
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION    SUBJECT TO COMPLETION   December 27, 2004
--------------------------------------------------------------------------------

STATEMENT OF ADDITIONAL INFORMATION
              , 2004

EATON VANCE ENHANCED EQUITY INCOME FUND II

THE EATON VANCE BUILDING
255 STATE STREET
BOSTON, MASSACHUSETTS 02109
(800) 225-6265

TABLE OF CONTENTS
--------------------------------------------------------------------------------

<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Additional investment information and restrictions..........    2
Trustees and officers.......................................    7
Investment advisory and other services......................   15
Determination of net asset value............................   18
Portfolio trading...........................................   20
Taxes.......................................................   22
Other information...........................................   27
Independent registered public accounting firm...............   27
Statement of assets and liabilities.........................   29
Notes to financial statements...............................   30
</Table>

THIS STATEMENT OF ADDITIONAL INFORMATION ("SAI") IS NOT A PROSPECTUS AND IS
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED OR
ACCOMPANIED BY THE PROSPECTUS OF EATON VANCE ENHANCED EQUITY INCOME FUND II (THE
"FUND") DATED [          ], 2004 (THE "PROSPECTUS"), AS SUPPLEMENTED FROM TIME
TO TIME, WHICH IS INCORPORATED HEREIN BY REFERENCE. THIS SAI SHOULD BE READ IN
CONJUNCTION WITH SUCH PROSPECTUS, A COPY OF WHICH MAY BE OBTAINED WITHOUT CHARGE
BY CONTACTING YOUR FINANCIAL INTERMEDIARY OR CALLING THE FUND AT 1-800-225-6265.

THE INFORMATION IN THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT COMPLETE AND
MAY BE CHANGED. THESE SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
STATEMENT OF ADDITIONAL INFORMATION, WHICH IS NOT A PROSPECTUS, IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>

Capitalized terms used in this SAI and not otherwise defined have the meanings
given them in the Fund's Prospectus.

Additional investment information and restrictions

Primary investment strategies are described in the Prospectus. The following is
a description of the various investment policies that may be engaged in, whether
as a primary or secondary strategy, and a summary of certain attendant risks.
Eaton Vance may not buy any of the following instruments or use any of the
following techniques unless it believes that doing so will help to achieve the
Fund's investment objectives.

Equity investments.  As described in the Prospectus, the Fund invests primarily
in common stocks.

Emerging Markets.  The Fund may invest up to 5% of its total assets in
securities of issuers located in emerging markets. The risks of foreign
investments described above apply to an even greater extent to investments in
emerging markets. The securities markets of emerging countries are generally
smaller, less developed, less liquid, and more volatile than the securities
markets of the U.S. and developed foreign markets. Disclosure and regulatory
standards in many respects are less stringent than in the U.S. and developed
foreign markets. There also may be a lower level of monitoring and regulation of
securities markets in emerging market countries and the activities of investors
in such markets and enforcement of existing regulations has been extremely
limited. Many emerging countries have experienced substantial, and in some
periods extremely high, rates of inflation for many years. Inflation and rapid
fluctuations in inflation rates have had and may continue to have very negative
effects on the economies and securities markets of certain emerging countries.
Economies in emerging markets generally are heavily dependent upon international
trade and, accordingly, have been and may continue to be affected adversely by
trade barriers, exchange controls, managed adjustments in relative currency
values, and other protectionist measures imposed or negotiated by the countries
with which they trade. The economies of these countries also have been and may
continue to be adversely affected by economic conditions in the countries in
which they trade. The economies of countries with emerging markets may also be
predominantly based on only a few industries or dependent on revenues from
particular commodities. In addition, custodial services and other costs relating
to investment in foreign markets may be more expensive in emerging markets than
in many developed foreign markets, which could reduce the Fund's income from
such securities.

In many cases, governments of emerging countries continue to exercise
significant control over their economies, and government actions relative to the
economy, as well as economic developments generally, may affect the Fund's
investments in those countries. In addition, there is a heightened possibility
of expropriation or confiscatory taxation, imposition of withholding taxes on
interest payments, or other similar developments that could affect investments
in those countries. There can be no assurance that adverse political changes
will not cause the Fund to suffer a loss of any or all of its investments.

Preferred Stocks.  The Fund may invest in preferred stocks of both domestic and
foreign issuers. Under normal market conditions, the Fund expects, with respect
to that portion of its total assets invested in preferred stocks, to invest only
in preferred stocks of investment grade quality as determined by S&P, Fitch or
Moody's or, if unrated, determined to be of comparable quality by Eaton Vance.
The foregoing credit quality policies apply only at the time a security is
purchased, and the Fund is not required to dispose of a security in the event of
a downgrade of an assessment of credit quality or the withdrawal of a rating.
Preferred stocks involve credit risk, which is the risk that a preferred stock
will decline in price, or fail to pay dividends when expected, because the
issuer experiences a decline in its financial status. In addition to credit
risk, investment in preferred stocks involves certain other risks as more fully
described in the Prospectus.

Derivative instruments.  Derivative instruments (which are instruments that
derive their value from another instrument, security or index) may be purchased
or sold to enhance return (which may be

--------------------------------------------------------------------------------
 2
<PAGE>
ADDITIONAL INVESTMENT INFORMATION AND RESTRICTIONS
--------------------------------------------------------------------------------

considered speculative), to hedge against fluctuations in securities prices or
market conditions, or as a substitute for the purchase or sale of securities or
currencies. These strategies may be executed through the use of derivative
contracts in the United States. or abroad. In the course of pursuing these
investment strategies, the Fund may purchase and sell exchange-listed and
over-the-counter put and call options on securities, equity and fixed-income
indices and other instruments, purchase and sell futures contracts and options
thereon, and enter into various transactions such as swaps, caps, floors or
collars. In addition, derivatives may also include new techniques, instruments
or strategies that are permitted as regulatory changes occur. Transactions in
derivative instruments involve a risk of loss or depreciation due to:
unanticipated adverse changes in securities prices, interest rates, indices, or
the other financial instruments' prices; the inability to close out a position;
default by the counterparty; imperfect correlation between a position and the
desired hedge; tax constraints on closing out positions; and portfolio
management constraints on securities subject to such transactions. The loss on
derivative instruments (other than purchased options) may substantially exceed
an investment in these instruments. In addition, the entire premium paid for
purchased options may be lost before they can be profitably exercised.
Transaction costs are incurred in opening and closing positions. Derivative
instruments may sometimes increase or leverage exposure to a particular market
risk, thereby increasing price volatility. Over-the-counter ("OTC") derivative
instruments, equity swaps and forward sales of stocks involve an enhanced risk
that the issuer or counterparty will fail to perform its contractual
obligations. Some derivative instruments are not readily marketable or may
become illiquid under adverse market conditions. In addition, during periods of
market volatility, a commodity exchange may suspend or limit trading in an
exchange-traded derivative instrument, which may make the contract temporarily
illiquid and difficult to price. Commodity exchanges may also establish daily
limits on the amount that the price of a futures contract or futures option can
vary from the previous day's settlement price. Once the daily limit is reached,
no trades may be made that day at a price beyond the limit. This may prevent the
closing out of positions to limit losses. The staff of the SEC takes the
position that certain purchased OTC options, and assets used as cover for
written OTC options, are illiquid. The ability to terminate OTC derivative
instruments may depend on the cooperation of the counterparties to such
contracts. For thinly traded derivative instruments, the only source of price
quotations may be the selling dealer or counterparty. In addition, certain
provisions of the Internal Revenue Code of 1986, as amended (the "Code") limit
the use of derivative instruments. The Fund has claimed an exclusion from the
definition of a Commodity Pool Operator ("CPO") under the Commodity Exchange Act
and therefor is not subject to registration or regulation as a CPO. There can be
no assurance that the use of derivative instruments will be advantageous.

Foreign exchange traded futures contracts and options thereon may be used only
if the Adviser determines that trading on such foreign exchange does not entail
risks, including credit and liquidity risks, that are materially greater than
the risks associated with trading on CFTC-regulated exchanges.

SHORT SALES
The Fund may sell a security short if it owns at least an equal amount of the
security sold short or another security convertible or exchangeable for an equal
amount of the security sold short without payment of further compensation (a
short sale against-the-box).

Purchasing securities to close out the short position can itself cause the price
of the securities to rise further, thereby exacerbating the loss. Short-selling
exposes the Fund to unlimited risk with respect to that security due to the lack
of an upper limit on the price to which an instrument can rise. Although the
Fund reserves the right to utilize short sales, the Adviser is under no
obligation to utilize short sales at all.

SECURITIES LENDING
As described in the Prospectus, the Fund may lend a portion of its portfolio
securities to broker-dealers or other institutional borrowers. Loans will be
made only to organizations whose credit quality or

--------------------------------------------------------------------------------
                                                                               3
<PAGE>
ADDITIONAL INVESTMENT INFORMATION AND RESTRICTIONS
--------------------------------------------------------------------------------

claims paying ability is considered by the Adviser to be at least investment
grade. All securities loans will be collateralized on a continuous basis by cash
or U.S. government securities having a value, marked to market daily, of at
least 100% of the market value of the loaned securities. The Fund may receive
loan fees in connection with loans that are collateralized by securities or on
loans of securities for which there is special demand. The Fund may also seek to
earn income on securities loans by reinvesting cash collateral in securities
consistent with its investment objectives and policies, seeking to invest at
rates that are higher than the "rebate" rate that it normally will pay to the
borrower with respect to such cash collateral. Any such reinvestment will be
subject to the investment policies, restrictions and risk considerations
described in the Prospectus and in this SAI.

Securities loans may result in delays in recovering, or a failure of the
borrower to return, the loaned securities. The defaulting borrower ordinarily
would be liable to the Fund for any losses resulting from such delays or
failures, and the collateral provided in connection with the loan normally would
also be available for that purpose. Securities loans normally may be terminated
by either the Fund or the borrower at any time. Upon termination and the return
of the loaned securities, the Fund would be required to return the related cash
or securities collateral to the borrower and it may be required to liquidate
longer term portfolio securities in order to do so. To the extent that such
securities have decreased in value, this may result in the Fund realizing a loss
at a time when it would not otherwise do so. The Fund also may incur losses if
it is unable to reinvest cash collateral at rates higher than applicable rebate
rates paid to borrowers and related administrative costs. These risks are
substantially the same as those incurred through investment leverage, and will
be subject to the investment policies, restrictions and risk considerations
described in the Prospectus and in this SAI.

The Fund will receive amounts equivalent to any interest or other distributions
paid on securities while they are on loan, and the Fund will not be entitled to
exercise voting or other beneficial rights on loaned securities. The Fund will
exercise its right to terminate loans and thereby regain these rights whenever
the Adviser considers it to be in the Fund's interest to do so, taking into
account the related loss of reinvestment income and other factors.

TEMPORARY INVESTMENTS
The Fund may invest temporarily in cash or cash equivalents. Cash equivalents
are highly liquid, short-term securities such as commercial paper, time
deposits, certificates of deposit, short-term notes and short-term U.S.
government obligations.

INVESTMENT RESTRICTIONS
The following investment restrictions of the Fund are designated as fundamental
policies and as such cannot be changed without the approval of the holders of a
majority of the Fund's outstanding voting securities, which as used in this SAI
means the lesser of (a) 67% of the shares of the Fund present or represented by
proxy at a meeting if the holders of more than 50% of the outstanding shares are
present or represented at the meeting or (b) more than 50% of outstanding shares
of the Fund. As a matter of fundamental policy the Fund may not:

(1) Borrow money, except as permitted by the Investment Company Act of 1940, as
    amended (the "1940 Act"). The 1940 Act currently requires that any
    indebtedness incurred by a closed-end investment company have an asset
    coverage of at least 300%;

(2) Issue senior securities, as defined in the 1940 Act, other than (a)
    preferred shares which immediately after issuance will have asset coverage
    of at least 200%, (b) indebtedness which immediately after issuance will
    have asset coverage of at least 300%, or (c) the borrowings permitted by
    investment restriction (1) above. The 1940 Act currently defines "senior
    security" as any bond, debenture, note or similar obligation or instrument
    constituting a security and evidencing indebtedness and any stock of a class
    having priority over any other class as to distribution of assets or payment
    of dividends. Debt and equity securities issued by a closed-end

--------------------------------------------------------------------------------
 4
<PAGE>
ADDITIONAL INVESTMENT INFORMATION AND RESTRICTIONS
--------------------------------------------------------------------------------

    investment company meeting the foregoing asset coverage provisions are
    excluded from the general 1940 Act prohibition on the issuance of senior
    securities;

(3) Purchase securities on margin (but the Fund may obtain such short-term
    credits as may be necessary for the clearance of purchases and sales of
    securities). The purchase of investment assets with the proceeds of a
    permitted borrowing or securities offering will not be deemed to be the
    purchase of securities on margin;

(4) Underwrite securities issued by other persons, except insofar as it may
    technically be deemed to be an underwriter under the Securities Act of 1933,
    as amended, in selling or disposing of a portfolio investment;

(5) Make loans to other persons, except by (a) the acquisition of loan
    interests, debt securities and other obligations in which the Fund is
    authorized to invest in accordance with its investment objectives and
    policies, (b) entering into repurchase agreements, and (c) lending its
    portfolio securities;

(6) Purchase or sell real estate, although it may purchase and sell securities
    which are secured by interests in real estate and securities of issuers
    which invest or deal in real estate. The Fund reserves the freedom of action
    to hold and to sell real estate acquired as a result of the ownership of
    securities;

(7) Purchase or sell physical commodities or contracts for the purchase or sale
    of physical commodities. Physical commodities do not include futures
    contracts with respect to securities, securities indices, currencies,
    interest or other financial instruments;

(8) With respect to 75% of its total assets, invest more than 5% of its total
    assets in the securities of a single issuer or purchase more than 10% of the
    outstanding voting securities of a single issuer, except obligations issued
    or guaranteed by the U.S. government, its agencies or instrumentalities and
    except securities of other investment companies; and

(9) Invest 25% or more of its total assets in any single industry or group of
    industries (other than securities issued or guaranteed by the U.S.
    government or its agencies or instrumentalities).

The Fund may borrow money as a temporary measure for extraordinary or emergency
purposes, including the payment of dividends and the settlement of securities
transactions which otherwise might require untimely dispositions of Fund
securities. The 1940 Act currently requires that the Fund have 300% asset
coverage with respect to all borrowings other than temporary borrowings.

For purposes of construing restriction (9), a large economic or market sector
shall not be construed as a group of industries.

The Fund has adopted the following nonfundamental investment policy which may be
changed by the Board without approval of the Fund's shareholders. As a matter of
nonfundamental policy, the Fund may not make short sales of securities or
maintain a short position, unless at all times when a short position is open it
either owns an equal amount of such securities or owns securities convertible
into or exchangeable, without payment of any further consideration, for
securities of the same issue as, and equal in amount to, the securities sold
short.

Upon the Board's approval, the Fund may invest more than 10% of its total assets
in one or more other management investment companies (or may invest in
affiliated investment companies) to the extent permitted by the 1940 Act and
rules thereunder.

Whenever an investment policy or investment restriction set forth in the
Prospectus or this SAI states a maximum percentage of assets that may be
invested in any security or other assets or describes a policy regarding quality
standards, such percentage limitation or standard shall be determined
immediately after and as a result of the Fund's acquisition of such security or
asset. Accordingly, any

--------------------------------------------------------------------------------
                                                                               5
<PAGE>
ADDITIONAL INVESTMENT INFORMATION AND RESTRICTIONS
--------------------------------------------------------------------------------

later increase or decrease resulting from a change in values, assets or other
circumstances or any subsequent rating change made by a rating service (or as
determined by the Adviser if the security is not rated by a rating agency) will
not compel the Fund to dispose of such security or other asset. Notwithstanding
the foregoing, the Fund must always be in compliance with the borrowing policies
set forth above.

--------------------------------------------------------------------------------
 6
<PAGE>

--------------------------------------------------------------------------------

Trustees and officers

The Trustees of the Fund are responsible for the overall management and
supervision of the affairs of the Fund. The Trustees and officers of the Fund
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. The "noninterested
Trustees" consist of those Trustees who are not "interested persons" of the
Fund, as that term is defined under the 1940 Act. The business address of each
Trustee and officer is The Eaton Vance Building, 255 State Street, Boston,
Massachusetts 02109. As used in this SAI, "EVC" refers to Eaton Vance Corp.,
"EV" refers to Eaton Vance, Inc., "BMR" refers to Boston Management and
Research, and "EVD" refers to Eaton Vance Distributors Inc. EVC and EV are the
corporate parent and trustee, respectively, of Eaton Vance and BMR. Eaton Vance
has engaged Rampart Investment Management Company, Inc. ("Rampart" or the
"Sub-Adviser") to serve as sub-adviser to the Fund to provide advice on and
execution of the construction of the Fund's equity portfolio and options
strategy, pursuant to an investment sub-advisory agreement (the "Sub-Advisory
Agreement") among the Fund, the Adviser and Rampart.

<Table>
<Caption>
                                                                                   NUMBER OF
                                                                               PORTFOLIOS IN
                                      TERM OF OFFICE                            FUND COMPLEX               OTHER
NAME AND                 POSITION(S)      AND LENGTH  PRINCIPAL OCCUPATION(S)    OVERSEEN BY       DIRECTORSHIPS
DATE OF BIRTH          WITH THE FUND      OF SERVICE   DURING PAST FIVE YEARS     TRUSTEE(1)                HELD
----------------------------------------------------------------------------------------------------------------
<S>                   <C>             <C>             <C>                      <C>            <C>
INTERESTED TRUSTEES
James B. Hawkes       Trustee(2) and  Since 12/20/04  Chairman, President and       197       Director of EVC
11/9/41               Vice President  Three Years     Chief Executive Officer
                                                      of BMR, Eaton Vance,
                                                      EVC and EV; Director of
                                                      EV; Vice President and
                                                      Director of EVD.
                                                      Trustee and/or officer
                                                      of 197 registered
                                                      investment companies in
                                                      the Eaton Vance Fund
                                                      Complex. Mr. Hawkes is
                                                      an interested person
                                                      because of his
                                                      positions with BMR,
                                                      Eaton Vance, EVC and
                                                      EV, which are
                                                      affiliates of the Fund.
NON-INTERESTED TRUSTEES
Samuel L. Hayes, III  Trustee(2)      Since 12/20/04  Jacob H. Schiff               197       Director of
2/23/35                               Three Years     Professor of Investment                 Tiffany & Co.
                                                      Banking Emeritus,                       (specialty
                                                      Harvard University                      retailer) and
                                                      Graduate School of                      Telect, Inc.
                                                      Business                                (telecommunication
                                                      Administration.                         services company)
William H. Park       Trustee(3)      Since 12/20/04  President and Chief           194       None
9/19/47                               Three Years     Executive Officer,
                                                      Prizm Capital
                                                      Management, LLC
                                                      (investment management
                                                      firm) (since 2002).
                                                      Executive Vice
                                                      President and Chief
                                                      Financial Officer,
                                                      United Asset Management
                                                      Corporation (a holding
                                                      company owning
                                                      institutional
                                                      investment management
                                                      firms) (1982-2001).
</Table>

--------------------------------------------------------------------------------
                                                                               7
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

<Table>
<Caption>
                                                                                   NUMBER OF
                                                                               PORTFOLIOS IN
                                      TERM OF OFFICE                            FUND COMPLEX               OTHER
NAME AND                 POSITION(S)      AND LENGTH  PRINCIPAL OCCUPATION(S)    OVERSEEN BY       DIRECTORSHIPS
DATE OF BIRTH          WITH THE FUND      OF SERVICE   DURING PAST FIVE YEARS     TRUSTEE(1)                HELD
----------------------------------------------------------------------------------------------------------------
<S>                   <C>             <C>             <C>                      <C>            <C>
Ronald A. Pearlman    Trustee(3)      Since 12/20/04  Professor of Law,             194                     None
7/10/40                               Three Years     Georgetown University
                                                      Law Center (since
                                                      1999). Tax Partner,
                                                      Covington & Burling,
                                                      Washington, DC (1991-
                                                      2000).
Norton H. Reamer      Trustee(4)      Since 12/20/04  President, Chief              197                     None
9/21/35                               Three Years     Executive Officer and a
                                                      Director of Asset
                                                      Management Finance
                                                      Corp. (a specialty
                                                      finance company serving
                                                      the investment
                                                      management industry)
                                                      (since October 2003).
                                                      President, Unicorn
                                                      Corporation (an
                                                      investment and
                                                      financial advisory
                                                      services company)
                                                      (since September 2000).
                                                      Formerly, Chairman,
                                                      Hellman, Jordan
                                                      Management Co., Inc.
                                                      (an investment
                                                      management company)
                                                      (2000-2003). Formerly,
                                                      Advisory Director of
                                                      Berkshire Capital
                                                      Corporation (investment
                                                      banking firm) (2002-
                                                      2003). Formerly,
                                                      Chairman of the Board,
                                                      United Asset Management
                                                      Corporation (a holding
                                                      company owning
                                                      institutional
                                                      investment management
                                                      firms) and Chairman,
                                                      President and Director,
                                                      UAM Funds (mutual
                                                      funds) (1980-2000).
Lynn A. Stout         Trustee(4)      Since 12/20/04  Professor of Law,             197                     None
                                      Three Years     University of
                                                      California at Los
                                                      Angeles School of Law
                                                      (since July 2001).
                                                      Formerly, Professor of
                                                      Law, Georgetown
                                                      University Law Center.
</Table>

------------
(1)  Includes both master and feeder funds in master-feeder structure.
(2)  Class I Trustees whose term expires in 2005.
(3)  Class II Trustees whose term expires in 2006.
(4)  Class III Trustees whose term expires in 2007.

--------------------------------------------------------------------------------
 8
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

PRINCIPAL OFFICERS WHO ARE NOT TRUSTEES

<Table>
<Caption>
                                            TERM OF OFFICE
                               POSITION(S)      AND LENGTH
NAME AND DATE OF BIRTH       WITH THE FUND      OF SERVICE  PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS
----------------------------------------------------------------------------------------------------------
<S>                     <C>                 <C>             <C>
Duncan W. Richardson    President and       Since 11/8/04   Senior Vice President and Chief Equity
10/26/57                Chief Executive                     Investment Officer of Eaton Vance and BMR.
                        Officer                             Officer of 43 registered investment companies
                                                            managed by Eaton Vance or BMR.
Thomas E. Faust Jr.     Vice President      Since 11/8/04   Executive Vice President of Eaton Vance, BMR,
5/31/58                                                     EVC and EV; Chief Investment Officer of Eaton
                                                            Vance and BMR and Director of EVC. Chief
                                                            Executive Officer of Belair Capital Fund LLC,
                                                            Belcrest Capital Fund LLC, Belmar Capital Fund
                                                            LLC; Belport Capital Fund LLC and Belrose
                                                            Capital Fund LLC (private investment companies
                                                            sponsored by Eaton Vance). Officer of 57
                                                            registered investment companies managed by
                                                            Eaton Vance or BMR.
Lewis R. Piantedosi     Vice President      Since 11/8/04   Vice President of Eaton Vance and BMR. Equity
8/10/65                                                     Analyst at Eaton Vance since May 1999.
                                                            Previously, Partner, Portfolio Manager and
                                                            Equity Analyst for Freedom Capital Management
                                                            (1996-1999). Officer of 2 registered
                                                            investment companies managed by Eaton Vance or
                                                            BMR.
James L. O'Connor       Treasurer and       Since 11/8/04   Vice President of BMR, Eaton Vance and EVD.
4/1/45                  Principal                           Officer of 118 registered investment companies
                        Financial and                       managed by Eaton Vance or BMR.
                        Accounting Officer
Alan R. Dynner          Secretary           Since 11/8/04   Vice President, Secretary And Chief Legal
10/10/40                                                    Officer of BMR, Eaton Vance, EVD, EV and EVC.
                                                            Officer of 197 registered investment companies
                                                            managed by Eaton Vance or BMR.
Bryan Doddy             Assistant           Since 11/8/04
                        Treasurer
Janet E. Sanders        Assistant           Since 11/8/04
                        Treasurer and
                        Assistant
                        Secretary
A. John Murphy          Assistant           Since 11/8/04
                        Secretary
Frederick S. Marius     Assistant           Since 11/8/04
                        Secretary
</Table>

The Board of Trustees of the Fund has several standing Committees, including the
Governance Committee, the Audit Committee, and the Special Committee. Each such
Committee is comprised of only noninterested Trustees.

The Governance Committee of the Board of Trustees of the Fund is comprised of
the non-interested Trustees. Ms. Stout currently serves as chairperson of the
Governance Committee. The purpose of the Governance Committee is to consider,
evaluate and make recommendations to the Board of Trustees with respect to the
structure, membership and operation of the Board of Trustees and the Committees

--------------------------------------------------------------------------------
                                                                               9
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

thereof, including the nomination and selection of non-interested Trustees and
the compensation of non-interested Trustees.

The Governance Committee will, when a vacancy exists or is anticipated, consider
any nominee for noninterested Trustee recommended by a shareholder if such
recommendation is submitted to the Governance Committee, contains sufficient
background information concerning the candidate and is received in a
sufficiently timely manner.

Messrs. Reamer (Chairman), Hayes and Park and Ms. Stout are members of the Audit
Committee of the Board of Trustees of the Fund. The Board of Trustees has
designated Messrs. Hayes, Park and Reamer, each a non-interested Trustee, as
audit committee financial experts. The Audit Committee's purposes are to (i)
oversee the Fund's accounting and financial reporting processes, its internal
control over financial reporting, and, as appropriate, the internal control over
financial reporting of certain service providers; (ii) oversee or, as
appropriate, assist Board oversight of the quality and integrity of the Fund's
financial statements and the independent audit thereof; (iii) oversee, or, as
appropriate, assist Board oversight of, the Fund's compliance with legal and
regulatory requirements that relate to the Fund's accounting and financial
reporting, internal control over financial reporting and independent audits;
(iv) approve prior to appointment the engagement and, when appropriate,
replacement of the independent registered public accounting firm, and, if
applicable, nominate the independent registered public accounting firm to be
proposed for shareholder ratification in any proxy statement of the Fund; (v)
evaluate the qualifications, independence and performance of the independent
registered public accounting firm and the audit partner in charge of leading the
audit; and (vi) prepare, as necessary, audit committee reports consistent with
the requirements of Rule 306 of Regulation S-K for inclusion in the proxy
statement of the Fund.

Messrs. Hayes (Chairman), Park, Pearlman, Reamer and Ms. Stout are currently
members of the Special Committee of the Board of Trustees of the Fund. The
purposes of the Special Committee are to consider, evaluate and make
recommendations to the Board of Trustees concerning the following matters: (i)
contractual arrangements with each service provider to the Fund, including
advisory, sub-advisory, transfer agency, custodial and fund accounting,
distribution services and administrative services; (ii) any and all other
matters in which any of the Fund service providers (including Eaton Vance or any
affiliated entity thereof) has an actual or potential conflict of interest with
the interests of the Fund, or investors therein; and (iii) any other matter
appropriate for review by the non-interested Trustees, unless the matter is
within the responsibilities of the Audit Committee or the Governance Committee
of the Fund.

As of the date of this SAI, the Governance Committee has           times, the
Audit Committee and Special Committee have met times.

When considering approval of the Advisory Agreement between the Fund and the
Adviser, and the Sub-Advisory Agreement between the Adviser and Rampart, the
Special Committee considered, among other things, the following:

+  A report comparing the fees and expenses of the Fund and certain
   profitability analyses prepared by Eaton Vance and Rampart;

+  Information on the relevant peer group(s) of funds;

+  The economic outlook and the general investment outlook in the relevant
   investment markets;

+  Eaton Vance's and Rampart's results and financial condition and the overall
   organization of the Adviser and the Sub-Adviser;

+  Arrangements regarding the distribution of Fund shares;

--------------------------------------------------------------------------------
 10
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

+  The procedures used to determine the fair value of the Fund's assets;

+  The allocation of brokerage and the benefits received by the Adviser as the
   result of brokerage allocation; including allocations to soft dollar
   brokerage and allocations to firms that sell Eaton Vance fund shares;

+  Eaton Vance's management of the relationship with the custodian,
   subcustodians and fund accountants;

+  The resources devoted to Eaton Vance's compliance efforts undertaken on
   behalf of the funds it manages and the record of compliance with the
   investment policies and restrictions and with policies on personal securities
   transactions;

+  Rampart's compliance efforts with respect to the accounts it manages;

+  The quality, nature, cost and character of the administrative and other
   non-investment management services provided by Eaton Vance and its affiliates
   and of Rampart;

+  The terms of the Advisory Agreement and the Sub-Advisory Agreement, and the
   reasonableness and appropriateness of the particular fee paid by the Fund for
   the services described therein;

+  Operating expenses (including transfer agency expenses) to be paid to third
   parties; and

+  Information to be provided to investors, including the Fund's shareholders.

In evaluating the Advisory Agreement between the Fund and Eaton Vance, and the
Sub-Advisory Agreement between the Adviser and Rampart, the Special Committee
reviewed material furnished by Eaton Vance and Rampart at the initial Board
meeting held on December 20, 2004, including the above referenced considerations
and information relating to the education, experience and number of investment
professionals and other personnel who would provide services under the Advisory
Agreement and under the Sub-Advisory Agreement. The Special Committee also took
into account the time and attention to be devoted by senior management to the
Fund and the other funds in the complex. The Special Committee evaluated the
level of skill required to manage the Fund and concluded that the human
resources available at Eaton Vance were appropriate to fulfill effectively the
duties of the Adviser on behalf of the Fund. The Special Committee also
considered the business reputation of the Adviser, its financial resources and
professional liability insurance coverage and concluded that Eaton Vance would
be able to meet any reasonably foreseeable obligations under the Advisory
Agreement. The Special Committee also considered the business reputation of
Rampart and its options strategy and its past experience in implementing this
strategy.

The Special Committee received information concerning the investment philosophy
and investment process to be applied by Eaton Vance and Rampart in managing the
Fund. In this regard, the Special Committee considered Eaton Vance's in-house
research capabilities as well as other resources available to Eaton Vance
personnel, including research services that may be available to Eaton Vance as a
result of securities transactions effected for the Fund and other investment
advisory clients. The Special Committee concluded that Eaton Vance's and
Rampart's investment process, research capabilities and philosophy were well
suited to the Fund, given the Fund's investment objectives and policies.

In addition to the factors mentioned above, the Special Committee also reviewed
the level of the Adviser's profits in respect of the management of the Eaton
Vance funds, including the Fund. The Special Committee considered the other
profits realized by Eaton Vance and its affiliates in connection with the
operation of the Fund. The Special Committee also considered profit margins of
Eaton Vance in comparison with available industry data. In addition, the Special
Committee considered the fiduciary duty assumed by the Adviser in connection
with the service rendered to the Fund and the business reputation of the
Adviser, its financial resources and its professional liability insurance
coverage. In

--------------------------------------------------------------------------------
                                                                              11
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

evaluating the fees to be paid to Rampart, the Special Committee considered and
discussed fees paid to other investment sub-advisers in similar circumstances,
as well as fees charged by Rampart to other clients.

The Special Committee did not consider any single factor as controlling in
determining whether or not to approve the Advisory Agreement and the
Sub-Advisory Agreement. Nor are the items described herein all encompassing of
the matters considered by the Special Committee. In assessing the information
provided by Eaton Vance and its affiliates and Rampart, the Special Committee
also took into consideration the benefits to shareholders of investing in a fund
that is part of a large family of funds which provides a large variety of
shareholder services.

Based on its consideration of all factors that it deemed material and assisted
by the advice of its independent counsel, the Special Committee concluded that
the approval of the Advisory Agreement and the Sub-Advisory Agreement, including
the fee structure (described herein) is in the interests of shareholders. The
Special Committee also considered that the Adviser would enter into a
Shareholder Services Agreement with UBS Securities LLC, whereby the Adviser (and
not the Fund) would pay UBS Securities LLC to provide upon request certain
market data and reports to support shareholder services pursuant to the
agreement.

SHARE OWNERSHIP
The following table shows the dollar range of equity securities beneficially
owned by each Trustee in the Fund and all Eaton Vance Funds overseen by the
Trustee as of December 31, 2003.

<Table>
<Caption>
                                                                 AGGREGATE DOLLAR RANGE OF EQUITY
                                            DOLLAR RANGE OF    SECURITIES OWNED IN ALL REGISTERED
                                          EQUITY SECURITIES      FUNDS OVERSEEN BY TRUSTEE IN THE
NAME OF TRUSTEE                           OWNED IN THE FUND              EATON VANCE FUND COMPLEX
-------------------------------------------------------------------------------------------------
<S>                                       <C>                  <C>
INTERESTED TRUSTEE
  James B. Hawkes.......................        None                     Over $100,000
NON-INTERESTED TRUSTEES
  Samuel L. Hayes, III..................        None                     Over $100,000
  William H. Park.......................        None                     Over $100,000
  Ronald A. Pearlman....................        None                     Over $100,000
  Norton H. Reamer......................        None                     Over $100,000
</Table>

As of December 31, 200[ ], no noninterested Trustee or any of their immediate
family members owned beneficially or of record any class of securities of EVC,
EVD, Rampart or any person controlling, controlled by or under common control
with EVC, EVD or Rampart.

During the calendar years ended December 31, 200 and December 31, 200 , no
noninterested Trustee (or their immediate family members) had:

1.  Any direct or indirect interest in Eaton Vance, EVC, EVD, Rampart or any
    person controlling, controlled by or under common control with EVC, EVD or
    Rampart;

2.  Any direct or indirect material interest in any transaction or series of
    similar transactions with (i) the Fund; (ii) another fund managed by EVC or
    Rampart, distributed by EVD or a person controlling, controlled by or under
    common control with EVC, EVD or Rampart; (iii) EVC, EVD or Rampart; (iv) a
    person controlling, controlled by or under common control with EVC, EVD or
    Rampart; or (v) an officer of any of the above; or

3.  Any direct or indirect relationship with (i) the Fund; (ii) another fund
    managed by EVC or Rampart, distributed by EVD or a person controlling,
    controlled by or under common control

--------------------------------------------------------------------------------
 12
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

    with EVC, EVD or Rampart; (iii) EVC, EVD or Rampart; (iv) a person
    controlling, controlled by or under common control with EVC, EVD or Rampart;
    or (v) an officer of any of the above.

During the calendar years ended December 31, 200 and December 31, 200 , no
officer of EVC, EVD, Rampart or any person controlling, controlled by or under
common control with EVC, EVD or Rampart served on the Board of Directors of a
company where a noninterested Trustee of the Fund or any of their immediate
family members served as an officer.

Trustees of the Fund who are not affiliated with the Adviser may elect to defer
receipt of all or a percentage of their annual fees in accordance with the terms
of a Trustees Deferred Compensation Plan (the "Trustees' Plan"). Under the
Trustees' Plan, an eligible Trustee 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 Trustees under the Trustees' Plan will be
determined based upon the performance of such investments. Deferral of Trustees'
fees in accordance with the Trustees' Plan will have a negligible effect on the
Fund's assets, liabilities, and net income per share, and will not obligate the
Fund to retain the services of any Trustee or obligate the Fund to pay any
particular level of compensation to the Trustee. The Fund does not have a
retirement plan for its Trustees.

The fees and expenses of the Trustees of the Fund are paid by the Fund. (A
Trustee of the Fund who is a member of the Eaton Vance organization receives no
compensation from the Fund.) For the Fund's fiscal year ending December 31,
2006, it is anticipated that the Trustees of the Fund will earn the following
compensation in their capacities as Trustees. For the year ended December 31,
2004, the Trustees earned the compensation set forth below in their capacities
as Trustees from the funds in the Eaton Vance fund complex(1).

<Table>
<Caption>
SOURCE OF COMPENSATION
---------------------------------------------------------------------------------------------
<S>                                  <C>        <C>          <C>         <C>         <C>
Fund*..............................
Fund Complex.......................
</Table>

---------------

 *  Estimated

(1)  As of         , 2004, the Eaton Vance fund complex consisted of
     registered investment companies or series thereof.

(2)  Includes $    of deferred compensation.

(3)  Includes $    of deferred compensation.

PROXY VOTING POLICY.  The Fund is subject to the Eaton Vance Funds Proxy Voting
Policy and Procedures (the "Fund Policy"), pursuant to which the Trustees have
delegated proxy voting responsibility to the Adviser and adopted the Adviser's
proxy voting policies and procedures (the "Policies") which are described below.
The Trustees will review the Fund's proxy voting records from time to time and
will annually consider approving the Policies for the upcoming year. In the
event that a conflict of interest arises between the Fund's shareholders and the
Adviser or any of its affiliates or any affiliate of the Fund, the Adviser will
generally refrain from voting the proxies related to the companies giving rise
to such conflict until it consults with the Board of the Fund, except as
contemplated under the Fund Policy. The Board's Special Committee will instruct
the Adviser on the appropriate course of action.

The Policies are designed to promote accountability of a company's management to
its shareholders and to align the interests of management with those
shareholders. The Adviser will generally support company management on proposals
relating to environmental and social policy issues, on matters regarding the
state of organization of the company and routine matters related to corporate
administration which are not expected to have a significant economic impact on
the company or its shareholders. On all other matters, the Adviser will review
each matter on a case-by-case basis and reserves the right to deviate from the
Policies' guidelines when it believes the situation warrants such a

--------------------------------------------------------------------------------
                                                                              13
<PAGE>
TRUSTEES AND OFFICERS
--------------------------------------------------------------------------------

deviation. The Policies include voting guidelines for matters relating to, among
other things, the election of directors, approval of independent auditors,
executive compensation, corporate structure and anti-takeover defenses. The
Adviser may abstain from voting from time to time where it determines that the
costs associated with voting a proxy outweigh the benefits derived from
exercising the right to vote.

In addition, the Adviser will monitor situations that may result in a conflict
of interest between the Fund's shareholders and the Adviser or any of its
affiliates or any affiliate of the Fund by maintaining a list of significant
existing and prospective corporate clients. The Adviser's personnel responsible
for reviewing and voting proxies on behalf of the Fund will report any proxy
received or expected to be received from a company included on that list to
members of senior management of the Adviser identified in the Policies. Such
members of senior management will determine if a conflict exists. If a conflict
does exist, the proxy will either be voted strictly in accordance with the
Policies or the Adviser will seek instruction on how to vote from the Special
Committee. Information on how the Fund voted proxies relating to portfolio
securities during the 12 month period ended June 30, 2005 will be available (1)
without charge, upon request, by calling 1-800-262-1122, and (2) on the
Securities and Exchange Commission's website at http://www.sec.gov.

--------------------------------------------------------------------------------
 14
<PAGE>

Investment advisory and other services

The Investment Adviser.  Eaton Vance, its affiliates and its predecessor
companies have been managing assets of individuals and institutions since 1924
and of investment companies since 1931. They maintain a large staff of
experienced fixed-income, senior loan and equity investment professionals to
service the needs of their clients. The equity group covers stocks ranging from
blue chip to emerging growth companies. Eaton Vance and its affiliates act as
adviser to a family of mutual funds, and individual and various institutional
accounts. The fixed-income group focuses on all kinds of taxable
investment-grade and high-yield securities, tax-exempt investment-grade and
high-yield securities, and U.S. government securities. The senior loan group
focuses on senior floating rate loans, unsecured loans and other floating rate
debt securities such as notes, bonds and asset backed securities, including
corporations, hospitals, retirement plans, universities, foundations and trusts.

The Fund will be responsible for all of its costs and expenses not expressly
stated to be payable by Eaton Vance under the Advisory Agreement or
Administration Agreement. Such costs and expenses to be borne by the Fund
include, without limitation: custody and transfer agency fees and expenses,
including those incurred for determining net asset value and keeping accounting
books and records; expenses of pricing and valuation services; the cost of share
certificates; membership dues in investment company organizations; expenses of
acquiring, holding and disposing of securities and other investments; fees and
expenses of registering under the securities laws, stock exchange listing fees
and governmental fees; rating agency fees and preferred share remarketing
expenses; expenses of reports to shareholders, proxy statements and other
expenses of shareholders' meetings; insurance premiums; printing and mailing
expenses; interest, taxes and corporate fees; legal and accounting expenses;
compensation and expenses of Trustees not affiliated with Eaton Vance; expenses
of conducting repurchase offers for the purpose of repurchasing Fund shares; and
investment advisory and administration fees. The Fund will also bear expenses
incurred in connection with any litigation in which the Fund is a party and any
legal obligation to indemnify its officers and Trustees with respect thereto, to
the extent not covered by insurance.

The Advisory Agreement with the Adviser continues in effect to December 20, 2006
and from year to year so long as such continuance is approved at least annually
(i) by the vote of a majority of the noninterested Trustees of the Fund or of
the Adviser cast in person at a meeting specifically called for the purpose of
voting on such approval and (ii) by the Board of Trustees of the Fund or by vote
of a majority of the outstanding Shares of the Fund. The Fund's Administration
Agreement continues in effect from year to year so long as such continuance is
approved at least annually by the vote of a majority of the Fund's Trustees.
Each agreement may be terminated at any time without penalty on sixty (60) days'
written notice by the Trustees of the Fund or Eaton Vance, as applicable, or by
vote of the majority of the outstanding shares of the Fund. Each agreement will
terminate automatically in the event of its assignment. Each agreement provides
that, in the absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of its obligations or duties to the Fund under such
agreements on the part of Eaton Vance, Eaton Vance shall not be liable to the
Fund for any loss incurred, to the extent not covered by insurance.

The Advisory Agreement provides that Eaton Vance may engage one or more
investment sub-advisers to assist with some or all aspects of the management of
the Fund's investments subject to such approvals as are required under the 1940
Act. Pursuant to these provisions, Eaton Vance has engaged Rampart as a
sub-adviser to provide assistance with the development, implementation and
execution of the Fund's options strategy. The Advisory Agreement provides that
Eaton Vance may terminate any sub-advisory agreement entered into and directly
assume any functions performed by the sub-adviser, upon approval of the Board of
Trustees, without the need for approval of the shareholders of the Fund.

Eaton Vance is a business trust organized under Massachusetts law. EV serves as
trustee of Eaton Vance. Eaton Vance and EV are subsidiaries of EVC, a Maryland
corporation and publicly-held

--------------------------------------------------------------------------------
                                                                              15
<PAGE>
INVESTMENT ADVISORY AND OTHER SERVICES
--------------------------------------------------------------------------------

holding company. EVC through its subsidiaries and affiliates engages primarily
in investment management, administration and marketing activities. The Directors
of EVC are James B. Hawkes, John G. L. Cabot, Thomas E. Faust Jr., Leo I.
Higdon, Jr., John M. Nelson, Vincent M. O'Reilly, Winthrop H. Smith, Jr., and
Ralph Z. Sorenson. All shares of the outstanding Voting Common Stock of EVC are
deposited in a voting trust, the voting trustees of which are Messrs. Hawkes,
Faust, Jeffrey P. Beale, Alan R. Dynner, Thomas J. Fetter, Scott H. Page, Duncan
W. Richardson, William M. Steul, Payson F. Swaffield, Michael W. Weilheimer and
Wharton P. Whitaker (all of whom are officers of Eaton Vance). 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 BMR and Eaton Vance who are also officers,
or officers and Directors of EVC and EV. As indicated under "Trustees and
officers", all of the officers of the Fund (as well as Mr. Hawkes who is also a
Trustee) hold positions in the Eaton Vance organization.

EVC and its affiliates and their officers and employees from time to time have
transactions with various banks, including the custodian of the Fund, IBT. It is
Eaton Vance's opinion that the terms and conditions of such transactions were
not and will not be influenced by existing or potential custodial or other
relationships between the Fund and such banks.

The Sub-Adviser.  Rampart acts as the Fund's investment sub-adviser and provides
advice and assistance in pursuing the Fund's options strategy pursuant to a
sub-advisory agreement between the Adviser and Rampart (the "Sub-Advisory
Agreement"). Rampart, a Massachusetts corporation, was founded in 1983 by its
current owners Ronald M. Egalka and David R. Fraley. The Sub-Adviser provides
customized investment management services within a core competency in options to
a spectrum of institutional clients. Since its inception, the Sub-Adviser has
continuously expanded its computer modeling and analytical capabilities and
created tools to capitalize on opportunities in the capital markets. Rampart's
principal office is located at One International Place, Boston, MA 02110. As of
[     ], 2004 Rampart had approximately $[     ] billion of assets under
management.

Under the terms of the Sub-Advisory Agreement, Rampart provides advice and
assistance with the development, implementation and execution of the Fund's
options strategy, all subject to the supervision and direction of the Fund's
Board of Trustees and the Adviser. For services rendered by Rampart under the
Sub-Advisory Agreement, Eaton Vance pays Rampart a fee, payable monthly, in an
annual amount equal to 0.20% of the average daily gross assets of the Fund.

The Sub-Advisory Agreement continues until December 20, 2006 and from year to
year thereafter if approved annually (i) by the Fund's Board of Trustees or by
the holders of a majority of its outstanding voting securities and (ii) by a
majority of the Trustees who are not "interested persons" (as defined in the
1940 Act) of any party to the Sub-Advisory Agreement, by vote cast in person at
a meeting called for the purpose of voting on such approval. The Sub-Advisory
Agreement terminates automatically on its assignment and may be terminated
without penalty on 60 days written notice at the option of either the Adviser,
by the Fund's Board of Trustees or by a vote of a majority (as defined in the
1940 Act) of the Fund's outstanding shares or by Rampart upon 3 months notice.
As discussed above, Eaton Vance may terminate the Sub-Advisory Agreement and
directly assume responsibility for the services provided by Rampart upon
approval by the Board of Trustees without the need for approval of the
shareholders of the Fund.

The Sub-Advisory Agreement provides that in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard for its obligations and duties
thereunder, the Rampart is not liable for any error or judgment or mistake of
law or for any loss suffered by the Fund.

--------------------------------------------------------------------------------
 16
<PAGE>
INVESTMENT ADVISORY AND OTHER SERVICES
--------------------------------------------------------------------------------

CODES OF ETHICS

The Adviser, Rampart and the Fund have adopted Codes of Ethics governing
personal securities transactions. Under the Codes of Ethics, Eaton Vance and
Rampart employees may purchase and sell securities (including securities held or
eligible for purchase by the Fund) subject to the provisions of the Codes of
Ethics and certain employees are also subject to pre-clearance, reporting
requirements and other procedures.

The Codes of Ethics can be reviewed and copied at the Securities and Exchange
Commission's public reference room in Washington, DC (call 1-202-942-8090 for
information on the operation of the public reference room); on the EDGAR
Database on the SEC's Internet site (http://www.sec.gov); or, upon payment of
copying fees, by writing the SEC's public reference section, Washington, DC
20549-0102, or by electronic mail at publicinfo@sec.gov.

INVESTMENT ADVISORY SERVICES

Under the general supervision of the Fund's Board of Trustees, Eaton Vance will
carry out the investment and reinvestment of the assets of the Fund, will
furnish continuously an investment program with respect to the Fund, will
determine which securities should be purchased, sold or exchanged, and will
implement such determinations. Eaton Vance will furnish to the Fund investment
advice and provide related office facilities and personnel for servicing the
investments of the Fund. Eaton Vance will compensate all Trustees and officers
of the Fund who are members of the Eaton Vance organization and who render
investment services to the Fund, and will also compensate all other Eaton Vance
personnel who provide research and investment services to the Fund.

ADMINISTRATIVE SERVICES

Under the Administration Agreement, Eaton Vance is responsible for managing the
business affairs of the Fund, subject to the supervision of the Fund's Board of
Trustees. Eaton Vance will furnish to the Fund all office facilities, equipment
and personnel for administering the affairs of the Fund. Eaton Vance will
compensate all Trustees and officers of the Fund who are members of the Eaton
Vance organization and who render executive and administrative services to the
Fund, and will also compensate all other Eaton Vance personnel who perform
management and administrative services for the Fund. Eaton Vance's
administrative services include recordkeeping, preparation and filing of
documents required to comply with federal and state securities laws, supervising
the activities of the Fund's custodian and transfer agent, providing assistance
in connection with the Trustees' and shareholders' meetings, providing services
in connection with repurchase offers, if any, and other administrative services
necessary to conduct the Fund's business.

--------------------------------------------------------------------------------
                                                                              17
<PAGE>

--------------------------------------------------------------------------------

Determination of net asset value

The net asset value per share of the Fund is determined no less frequently than
daily, on each day that the New York Stock Exchange (the "Exchange") is open for
trading, as of the close of regular trading on the Exchange (normally 4:00 p.m.
New York time). The Fund's net asset value per share is determined by IBT, in
the manner authorized by the Trustees of the Fund. Net asset value is computed
by dividing the value of the Fund's total assets, less its liabilities by the
number of shares outstanding.

The Trustees of the Fund have established the following procedures for fair
valuation of the Fund's assets under normal market conditions. Marketable
securities listed on foreign or U.S. securities exchanges generally are valued
at closing sale prices or, if there were no sales, at the mean between the
closing bid and asked prices therefor on the exchange where such securities are
principally traded (such prices may not be used, however, where an active
over-the-counter market in an exchange listed security better reflects current
market value). Marketable securities listed in the NASDAQ National Market System
are valued at the NASDAQ official closing price. Unlisted or listed securities
for which closing sale prices are not available are valued at the mean between
the latest bid and asked prices. An option is valued at the last sale price as
quoted on the principal exchange or board of trade on which such option or
contract is traded, or in the absence of a sale, at the mean between the last
bid and asked prices. When the Fund writes a call option it records the premium
as an asset and equivalent liability and thereafter adjusts the liability to the
market value of the option determined in accordance with the preceding sentence.

The Adviser and the Valuation Committee may implement new pricing methodologies
or expand mark-to-market valuation of debt securities whose market prices are
not readily available in the future, which may result in a change in the Fund's
net asset value per share. The Fund's net asset value per share will also be
affected by fair value pricing decisions and by changes in the market for such
debt securities. In determining the fair value of a debt security, the Adviser
will consider relevant factors, data, and information, including: (i) the
characteristics of and fundamental analytical data relating to the debt
security, including the cost, size, current interest rate, period until next
interest rate reset, maturity and base lending rate of the debt security, the
terms and conditions of the debt security and any related agreements, and the
position of the debt security in the borrower's debt structure; (ii) the nature,
adequacy and value of the collateral, including the Fund's rights, remedies and
interests with respect to the collateral; (iii) the creditworthiness of the
borrower, based on an evaluation of its financial condition, financial
statements and information about the borrower's business, cash flows, capital
structure and future prospects; (iv) information relating to the market for the
debt security, including price quotations for and trading in the debt security
and interests in similar debt securities and the market environment and investor
attitudes towards the debt security and interests in similar debt securities;
(v) the experience, reputation, stability and financial condition of the agent
and any intermediate participants in the debt security; and (vi) general
economic and market conditions affecting the fair value of the debt security.
The fair value of each debt security is reviewed and approved by the Adviser's
Valuation Committee and the Fund's Trustees.

Debt securities for which the over-the-counter market is the primary market are
normally valued on the basis of prices furnished by one or more pricing services
at the mean between the latest available bid and asked prices. OTC options are
valued at the mean between the bid and asked prices provided by dealers.
Financial futures contracts listed on commodity exchanges and exchange-traded
options are valued at closing settlement prices. Short-term obligations having
remaining maturities of less than 60 days are valued at amortized cost, which
approximates value, unless the Trustees determine that under particular
circumstances such method does not result in fair value. As authorized by the
Trustees, debt securities (other than short-term obligations) may be valued on
the basis of valuations furnished by a pricing service which determines
valuations based upon market transactions for normal,

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DETERMINATION OF NET ASSET VALUE
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institutional-size trading units of such securities. Securities for which there
is no such quotation or valuation and all other assets are valued at fair value
as determined in good faith by or at the direction of the Fund's Trustees
considering relevant factors, data and information, including the market value
of freely tradable securities of the same class in the principal market on which
such securities are normally traded.

All other securities are valued at fair value as determined in good faith by or
at the direction of the Trustees.

The daily valuation of foreign equity securities held by the Fund generally is
determined as of the close of trading on the principal exchange on which such
securities trade. Events occurring after the close of trading on foreign
exchanges may result in adjustments to the valuation of foreign securities to
more accurately reflect their fair value as of the close of regular trading on
the Exchange. The Fund may rely on an independent fair valuation service in
making any such adjustment. Foreign securities held by the Fund will be valued
in U.S. dollars; such values will be computed by the custodian based on foreign
currency exchange rate quotations supplied by an independent quotation service.

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Portfolio trading

Decisions concerning the execution of portfolio security transactions, including
the selection of the market and the executing firm, are made by Eaton Vance, the
Fund's Adviser or, Rampart as the Sub-Adviser. As used below, "Adviser" refers
to Eaton Vance and Rampart, as applicable. The Adviser is also responsible for
the execution of transactions for all other accounts managed by it. The Adviser
places the portfolio security transactions for execution with many firms. The
Adviser uses its best efforts to obtain execution of portfolio security
transactions at prices which are advantageous to the Fund and at reasonably
competitive spreads or (when a disclosed commission is being charged) at
reasonably competitive commission rates. In seeking such execution, the Adviser
will use its best judgment in evaluating the terms of a transaction, and will
give consideration to various relevant factors, including without limitation the
full range and quality of the executing firm's services, the value of the
brokerage and research services provided, the responsiveness of the firm to the
Adviser, the size and type of the transaction, the nature and character of the
market for the security, the confidentiality, speed and certainty of effective
execution required for the transaction, the general execution and operational
capabilities of the executing firm, the reputation, reliability, experience and
financial condition of the firm, the value and quality of the services rendered
by the firm in this and other transactions, and the reasonableness of the spread
or commission, if any.

Transactions on stock exchanges and other agency transactions involve the
payment 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 often involve the payment of brokerage
commissions, which may be 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 usually includes an undisclosed
dealer markup or markdown. In an underwritten offering the price paid often
includes a disclosed fixed commission or discount retained by the underwriter or
dealer.

Although spreads or commissions paid on portfolio security transactions will, in
the judgment of the Adviser, 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 Adviser's clients in part for providing brokerage and research
services to the Adviser.

As authorized in Section 28(e) of the Securities Exchange Act of 1934, as
amended, 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
the Adviser determines in good faith that such compensation was reasonable in
relation to the value of the brokerage and research services provided. This
determination may be made on the basis of that particular transaction or on the
basis of overall responsibilities which the Adviser and its affiliates have for
accounts over which they exercise investment discretion. 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; 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 of the investment advisory industry and of the advisers
of investment companies, institutions and other investors to receive research,
analytical, statistical and quotation

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PORTFOLIO TRADING
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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 and from affiliates of executing
broker-dealers. Advisers also commonly receive Research Services from research
providers that are not affiliated with an executing broker-dealer, but which
have entered into payment arrangements involving an executing broker-dealer
("Third Party Research Services"). Under a typical Third Party Research Services
payment arrangement, the research provider agrees to provide services to an
Adviser in exchange for specified payments to the research provider by a
broker-dealer that executes portfolio transactions for clients of the Adviser.
The Adviser and the executing broker-dealer enter into a related agreement
specifying the amount of brokerage business the Adviser will direct to the
executing broker-dealer to offset payments made by the executing broker-dealer
for Third Party Research Services received by the Adviser. For example, the
Adviser may agree to direct brokerage business generating $45,000 in commissions
on portfolio transactions to a broker-dealer firm as consideration for the
executing broker-dealer making payments of $30,000 to a provider of Third Party
Research Services. The ratio of the commissions to be paid to an executing
broker-dealer as consideration for Third Party Research Services over the cost
borne by the executing broker-dealer in connection with providing such services
to the Adviser is referred to herein as the "Third Party Research Services
Payment Ratio."

Consistent with the foregoing practices, the Adviser receives Research Services
from many broker-dealer firms with which the Adviser places the Fund's
transactions and from third parties with which these broker-dealers have
arrangements. The Fund and the Adviser may also receive Research Services from
underwriters and dealers in fixed-price offerings, which Research Services are
reviewed and evaluated by the Adviser in connection with its investment
responsibilities.

These Research Services include such matters as general economic, political,
business and market information, industry and company reviews, evaluations of
securities and portfolio strategies and transactions, proxy voting data and
analysis services, technical analysis of various aspects of the securities
market, 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, databases and services. Any particular
Research Service obtained through a broker-dealer may be used by the Adviser in
connection with client accounts other than those accounts which pay commissions
to such broker-dealer. Any such Research Service may be broadly useful and of
value to the Adviser 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 Fund is not reduced because the Adviser receives such Research
Services. The Adviser evaluates the nature and quality of the various Research
Services obtained through broker-dealer firms and attempts to allocate
sufficient portfolio security transactions to such firms to ensure the continued
receipt of Research Services which the Adviser believes are useful or of value
to it in rendering investment advisory services to its clients.

In the event that the Adviser executes Fund securities transactions with a
broker-dealer and the associated commission is consideration for Third Party
Research Services (as described above), the Adviser has agreed to reduce the
advisory fee payable by the Fund by an amount equal to the commission payment
associated with the transaction divided by the applicable Third Party Research
Services Payment Ratio.

Some executing broker-dealers develop and make available directly to their
brokerage customers proprietary Research Services ("Proprietary Research
Services"). As a general matter, broker-dealers bundle the cost of Proprietary
Research Services with trade execution services rather than charging separately
for each. In such circumstances, the cost or other value of the Proprietary
Research Services

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cannot be determined. The advisory fee paid by the Fund will not be reduced in
connection with the receipt of Proprietary Research Services by the Adviser.

The investment companies sponsored by the Adviser or its affiliates may allocate
brokerage commissions to acquire information relating to the performance, fees
and expenses of such companies and other mutual funds, which information is used
by the Trustees of such companies to fulfill their responsibility to oversee the
quality of the services provided by various entities, including the Adviser.
Such companies may also pay cash for such information.

Subject to the requirement that the Adviser shall use its best efforts to seek
and execute Fund security transactions at advantageous prices and at reasonably
competitive spreads or commission rates, the Adviser is authorized to consider
as a factor in the selection of any broker-dealer firm with whom Fund orders may
be placed the fact that such firm has sold or is selling Fund shares or shares
of other investment companies sponsored by the Adviser or its affiliates. This
policy is not inconsistent with a rule of the NASD, which rule provides that no
firm which is a member of the NASD shall favor or disfavor the distribution of
shares of any particular investment company or group of investment companies on
the basis of brokerage commissions received or expected by such firm from any
source.

The Fund and the Adviser may also receive Research Services from underwriters
and dealers in fixed-price offerings, which Research Services are reviewed and
evaluated by the Adviser in connection with its investment responsibilities. The
investment companies sponsored by the Adviser or its affiliates may allocate
trades in such offerings to acquire information relating to the performance,
fees and expenses of such companies and other mutual funds, which information is
used by the Trustees of such companies to fulfill their responsibility to
oversee the quality of the services provided by various entities, including the
Adviser, to such companies. Such companies may also pay cash for such
information.

Securities considered as investments for the Fund may also be appropriate for
other investment accounts managed by the Adviser or its affiliates. Whenever
decisions are made to buy or sell securities by the Fund and one or more of such
other accounts simultaneously, the Adviser will allocate the security
transactions (including "hot" issues) in a manner which it believes to be
equitable under the circumstances. As a result of such allocations, there may be
instances where the Fund will not participate in a transaction that is allocated
among other accounts. If an aggregated order cannot be filled completely,
allocations will generally be made on a pro rata basis. An order may not be
allocated on a pro rata basis where, for example: (i) consideration is given to
portfolio managers who have been instrumental in developing or negotiating a
particular investment; (ii) consideration is given to an account with
specialized investment policies that coincide with the particulars of a specific
investment; (iii) pro rata allocation would result in odd-lot or de minimis
amounts being allocated to a portfolio or other client; or (iv) where the
Adviser reasonably determines that departure from a pro rata allocation is
advisable. While these aggregation and allocation policies could have a
detrimental effect on the price or amount of the securities available to the
Fund from time to time, it is the opinion of the Trustees of the Fund that the
benefits from the Adviser's organization outweigh any disadvantage that may
arise from exposure to simultaneous transactions.

Taxes

The following discussion of federal income tax matters is based on the advice of
Kirkpatrick & Lockhart LLP, counsel to the Fund. The Fund intends to elect to be
treated and to qualify each year as a regulated investment company ("RIC") under
the Code. Accordingly, the Fund intends to satisfy certain requirements relating
to sources of its income and diversification of its assets and to distribute
substantially all of its net income and net short-term and long-term capital
gains (after reduction by any available capital loss carryforwards) in
accordance with the timing requirements imposed by the Code, so as to maintain
its RIC status and to avoid paying any federal income or excise tax. To the

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<PAGE>
TAXES
--------------------------------------------------------------------------------

extent it qualifies for treatment as a RIC and satisfies the above-mentioned
distribution requirements, the Fund will not be subject to federal income tax on
income paid to its shareholders in the form of dividends or capital gain
distributions.

In order to avoid incurring a nondeductible 4% federal excise tax obligation,
the Code requires that the Fund distribute (or be deemed to have distributed) by
December 31 of each calendar year an amount at least equal to the sum of (i) 98%
of its ordinary income for such year, (ii) 98% of its capital gain net income
(which is the excess of its realized net long-term capital gain over its
realized net short-term capital loss), generally computed on the basis of the
one-year period ending on October 31 of such year, after reduction by any
available capital loss carryforwards, and (iii) 100% of any ordinary income and
capital gain net income from the prior year (as previously computed) that were
not paid out during such year and on which the Fund paid no federal income tax.
Under current law, provided that the Fund qualifies as a RIC for federal income
tax purposes, the Fund should not be liable for any income, corporate excise or
franchise tax in The Commonwealth of Massachusetts.

If the Fund does not qualify as a RIC for any taxable year, the Fund's taxable
income will be subject to corporate income taxes, and all distributions from
earnings and profits, including distributions of net capital gain (if any), will
be taxable to the shareholder as ordinary income. In addition, in order to
requalify for taxation as a RIC, the Fund may be required to recognize
unrealized gains, pay substantial taxes and interest, and make certain
distributions.

The taxation of equity options that the Fund expects to write is governed by
Code Section 1234. Pursuant to Code Section 1234, the premium received by the
Fund for selling a call option is not included in income at the time of receipt.
If the option expires, the premium is short-term capital gain to the Fund. If
the Fund enters into a closing transaction, the difference between the amount
paid to close out its position and the premium received is short-term capital
gain or loss. If a call option written by the Fund is exercised, thereby
requiring the Fund to sell the underlying security, the premium will increase
the amount realized upon the sale of the security and any resulting gain or loss
will be long-term or short-term, depending upon the holding period of the
security. With respect to a put or call option that is purchased by the Fund, if
the option is sold, any resulting gain or loss will be a capital gain or loss,
and will be short-term or long-term, depending upon the holding period for the
option. If the option expires, the resulting loss is a capital loss and is
short-term or long-term, depending upon the holding period for the option. If
the option is exercised, the cost of the option, in the case of a call option,
is added to the basis of the purchased security and, in the case of a put
option, reduces the amount realized on the underlying security in determining
gain or loss. Because the Fund does not have control over the exercise of the
call options it writes, such exercise or other required sales of the underlying
securities may cause the Fund to realize capital gains or losses at inopportune
times.

Under the Jobs and Growth Tax Relief Reconciliation Act of 2003 (the "Tax Act"),
certain income distributions paid by the Fund (whether paid in cash or
reinvested in additional Fund Shares) to individual taxpayers are taxed at rates
applicable to net long-term capital gains (15%, or 5% for individuals in the 10%
or 15% tax brackets). This tax treatment applies only if certain holding period
requirements and other requirements are satisfied by the Common Shareholder with
respect to his or her Common Shares and the dividends are attributable to
qualified dividend income received by the Fund itself. For this purpose,
"qualified dividend income" means dividends received by the Fund from U.S.
corporations and "qualified foreign corporations," provided that the Fund
satisfies certain holding period and other requirements in respect of the stock
of such corporations. These special rules relating to the taxation of ordinary
income dividends paid by RICs generally applies to taxable years beginning
before January 1, 2009. Thereafter, the Fund's dividends, other than capital
gain dividends, will be fully taxable at ordinary income tax rates unless
further Congressional action is taken. There can be no assurance as to what
portion of the Fund's dividend distributions will qualify for favorable
treatment under the Tax Act.

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TAXES
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Common Shareholders receiving dividends or distributions in the form of
additional Common Shares pursuant to the Plan will be treated for U.S. federal
income tax purposes as receiving a distribution in an amount equal to the amount
of money that the shareholders receiving cash dividends or distributions will
receive, and will have a cost basis in the Common Shares received equal to such
amount. The Fund will inform shareholders of the source and tax status of all
distributions promptly after the close of each calendar year.

The benefits of the reduced tax rates applicable to long-term capital gains and
qualified dividend income may be impacted by the application of the alternative
minimum tax to individual shareholders.

The Fund's investment in zero coupon, payment in kind and certain other
securities will cause it to realize income prior to the receipt of cash payments
with respect to these securities. Such income will be accrued daily by the Fund
and, in order to avoid a tax payable by the Fund, the Fund may be required to
liquidate securities that it might otherwise have continued to hold in order to
generate cash so that the Fund may make required distributions to its
shareholders.

Investments in lower rated or unrated securities may present special tax issues
for the Fund to the extent that the issuers of these securities default on their
obligations pertaining thereto. The Code is not entirely clear regarding the
federal income tax consequences of the Fund's taking certain positions in
connection with ownership of such distressed securities.

Any recognized gain or income attributable to market discount on long-term debt
obligations (i.e., obligations with a term of more than one year except to the
extent of a portion of the discount attributable to original issue discount)
purchased by the Fund is taxable as ordinary income. A long-term debt obligation
is generally treated as acquired at a market discount if purchased after its
original issue at a price less than (i) the stated principal amount payable at
maturity, in the case of an obligation that does not have original issue
discount or (ii) in the case of an obligation that does have original issue
discount, the sum of the issue price and any original issue discount that
accrued before the obligation was purchased, subject to a de minimis exclusion.

The Fund's transactions in futures contracts and options will be subject to
special provisions of the Code that, among other things, may affect the
character of gains and losses realized by the Fund (i.e., may affect whether
gains or losses are ordinary or capital, or short-term or long-term), may
accelerate recognition of income to the Fund and may defer Fund losses. These
rules could, therefore, affect the character, amount and timing of distributions
to shareholders. These provisions also (a) will require the Fund to
mark-to-market certain types of the positions in its portfolio (i.e., treat them
as if they were closed out), and (b) may cause the Fund to recognize income
without receiving cash with which to make distributions in amounts necessary to
satisfy the 90% distribution requirement for qualifying to be taxed as a
regulated investment company and the 98% distribution requirement for avoiding
excise taxes. The Fund will monitor its transactions, will make the appropriate
tax elections and will make the appropriate entries in its books and records
when it acquires any futures contract, option or hedged investment in order to
mitigate the effect of these rules and prevent disqualification of the Fund from
being taxed as a regulated investment company.

In particular, the Fund expects to write call options with respect to certain
securities held by the Fund. Depending on whether such options are exercised or
lapse, or whether the securities or options are sold, the existence of these
options will affect the amount and timing of the recognition of income and
whether the income qualifies as long-term capital gain.

Further, the Fund's transactions in options are subject to special and complex
federal income tax provisions that may, among other things, (i) convert
dividends that would otherwise constitute qualified dividend income into
short-term capital gain or ordinary income taxed at the higher rate applicable
to ordinary income, (ii) treat dividends that would otherwise be eligible for
the corporate

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TAXES
--------------------------------------------------------------------------------

dividends received deduction as ineligible for such treatment, (iii) disallow,
suspend or otherwise limit the allowance of certain losses or deductions, (iv)
convert long-term capital gain into short-term capital gain or ordinary income,
(v) convert an ordinary loss or deduction into a capital loss (the deductibility
of which is more limited) and (vi) cause the Fund to recognize income or gain
without a corresponding receipt of cash.

Any loss realized upon the sale or exchange of Fund shares with a holding period
of six months or less will be treated as a long-term capital loss to the extent
of any capital gain distributions received with respect to such shares. In
addition, all or a portion of a loss realized on a sale or other disposition of
Fund shares may be disallowed under "wash sale" rules to the extent the
shareholder acquires other shares of the same Fund (whether through the
reinvestment of distributions or otherwise) within a period of 61 days beginning
30 days before and ending 30 days after the date of disposition of the Common
Shares. Any disallowed loss will result in an adjustment to the shareholder's
tax basis in some or all of the other shares acquired.

Sales charges paid upon a purchase of shares cannot be taken into account for
purposes of determining gain or loss on a sale of the shares before the 91st day
after their purchase to the extent a sales charge is reduced or eliminated in a
subsequent acquisition of shares of the Fund (or of another fund) pursuant to
the reinvestment or exchange privilege. Any disregarded amounts will result in
an adjustment to the shareholder's tax basis in some or all of any other shares
acquired.

Dividends and distributions on the Fund's shares are generally subject to
federal income tax as described herein to the extent they do not exceed the
Fund's realized income and gains, even though such dividends and distributions
may economically represent a return of a particular shareholder's investment.
Such distributions are likely to occur in respect of shares purchased at a time
when the Fund's net asset value reflects gains that are either unrealized, or
realized but not distributed. Such realized gains may be required to be
distributed even when the Fund's net asset value also reflects unrealized
losses. Certain distributions declared in October, November or December and paid
in the following January will be taxed to shareholders as if received on
December 31 of the year in which they were declared. In addition, certain other
distributions made after the close of a taxable year of the Fund may be "spilled
back" and treated as paid by the Fund (except for purposes of the non-
deductible 4% federal excise tax) during such taxable year. In such case,
shareholders will be treated as having received such dividends in the taxable
year in which the distributions were actually made.

Dividends and interest received, and gains realized, by the Fund on foreign
securities may be subject to income, withholding or other taxes imposed by
foreign countries and U.S. possessions (collectively "foreign taxes") that would
reduce the return on its securities. Tax conventions between certain countries
and the United States, however, may reduce or eliminate foreign taxes, and many
foreign countries do not impose taxes on capital gains in respect of investments
by foreign investors. If more than 50% of the value of the Fund's total assets
at the close of its taxable year consists of securities of foreign issuers, the
Fund will be eligible to, and may, file an election with the Internal Revenue
Service (the "Service") that will enable its shareholders, in effect, to receive
the benefit of the foreign tax credit with respect to any foreign taxes paid by
it. Pursuant to the election, the Fund would treat those taxes as dividends paid
to its shareholders and each shareholder (1) would be required to include in
gross income, and treat as paid by such shareholder, a proportionate share of
those taxes, (2) would be required to treat such share of those taxes and of any
dividend paid by the Fund that represents income from foreign or U.S.
possessions sources as such shareholder's own income from those sources, and (3)
could either deduct the foreign taxes deemed paid in computing taxable income
or, alternatively, use the foregoing information in calculating the foreign tax
credit against federal income tax. The Fund will report to its shareholders
shortly after each taxable year their respective shares of foreign taxes paid
and the income from sources within, and taxes paid to, foreign countries and
U.S. possessions if it makes this election. An individual who has no more than
$300 ($600 for married

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persons filing jointly) of creditable foreign taxes included on Forms 1099 and
all of whose foreign source income is "qualified passive income" may elect each
year to be exempt from the complicated foreign tax credit limitation, in which
event such individual would be able to claim a foreign tax credit without
needing to file the detailed Form 1116 that otherwise is required.

The Fund may invest in the stock of "passive foreign investment companies"
("PFICs"). A PFIC is any foreign corporation (with certain exceptions) that, in
general, meets either of the following tests: (1) at least 75% of its gross
income is passive or (2) an average of at least 50% of its assets produce, or
are held for the production of, passive income. Under certain circumstances, the
Fund will be subject to federal income tax on a portion of any "excess
distribution" received on the stock of a PFIC or of any gain from disposition of
that stock (collectively "PFIC income"), plus interest thereon, even if the Fund
distributes the PFIC income as a taxable dividend to its shareholders. The
balance of the PFIC income will be included in the Fund's investment company
taxable income and, accordingly, will not be taxable to it to the extent it
distributes that income to its shareholders.

If the Fund invests in a PFIC and elects to treat the PFIC as a "qualified
electing fund" ("QEF"), then in lieu of the foregoing tax and interest
obligation, the Fund will be required to include in income each year its pro
rata share of the QEF's annual ordinary earnings and net capital gain--which it
may have to distribute to satisfy the distribution requirement and avoid
imposition of the excise tax--even if the QEF does not distribute those earnings
and gain to the Fund. In most instances it will be very difficult, if not
impossible, to make this election because of certain of its requirements.

The Fund may elect to "mark to market" its stock in any PFIC.
"Marking-to-market," in this context, means including in ordinary income each
taxable year the excess, if any, of the fair market value of a PFIC's stock over
the Fund's adjusted basis therein as of the end of that year. Pursuant to the
election, the Fund also would be allowed to deduct (as an ordinary, not capital,
loss) the excess, if any, of its adjusted basis in PFIC stock over the fair
market value thereof as of the taxable year-end, but only to the extent of any
net mark-to-market gains (reduced by any prior deductions) with respect to that
stock included by the Fund for prior taxable years under the election. The
Fund's adjusted basis in each PFIC's stock with respect to which it has made
this election will be adjusted to reflect the amounts of income included and
deductions taken thereunder.

Amounts paid by the Fund to individuals and certain other shareholders who have
not provided the Fund with their correct taxpayer identification number ("TIN")
and certain certifications required by the Service as well as shareholders with
respect to whom the Fund has received certain information from the Service or a
broker may be subject to "backup" withholding of federal income tax arising from
the Fund's taxable dividends and other distributions as well as the gross
proceeds of sales of shares, at a rate of 28% for amounts paid during 2004. An
individual's TIN is generally his or her social security number. Backup
withholding is not an additional tax. Any amounts withheld under the backup
withholding rules from payments made to a shareholder may be refunded or
credited against such shareholder's federal income tax liability, if any,
provided that the required information is furnished to the Service.

The foregoing briefly summarizes some of the important federal income tax
consequences to Common Shareholders of investing in Common Shares, reflects the
federal tax law as of the date of this Statement of Additional Information, and
does not address special tax rules applicable to certain types of investors,
such as corporate and foreign investors. Unless otherwise noted, this discussion
assumes that an investor is a U.S. shareholder and holds Common Shares as a
capital asset. This discussion is based upon current provisions of the Code, the
regulations promulgated thereunder, and judicial and administrative ruling
authorities, all of which are subject to change or differing interpretations by
the courts or the Service retroactively or prospectively. Investors should
consult their tax advisors regarding the federal, state or local tax
considerations that may be applicable to their particular circumstances.

--------------------------------------------------------------------------------
 26
<PAGE>

--------------------------------------------------------------------------------

Other information

The Fund is an organization of the type commonly known as a "Massachusetts
business trust." Under Massachusetts law, shareholders of such a trust may, in
certain circumstances, be held personally liable as partners for the obligations
of the trust. The Declaration of Trust contains an express disclaimer of
shareholder liability in connection with the Fund property or the acts,
obligations or affairs of the Fund. The Declaration of Trust in coordination
with the Fund's By-laws also provides for indemnification out of the Fund
property of any shareholder held personally liable for the claims and
liabilities to which a shareholder may become subject by reason of being or
having been a shareholder. Thus, the risk of a shareholder incurring financial
loss on account of shareholder liability is limited to circumstances in which
the Fund itself is unable to meet its obligations. The Fund has been advised by
its counsel that the risk of any shareholder incurring any liability for the
obligations of the Fund is remote.

The Declaration of Trust provides that the Trustees will not be liable for
errors of judgment or mistakes of fact or law; but nothing in the Declaration of
Trust protects a Trustee against any liability to the Fund or its shareholders
to which he or she would otherwise be subject by reason of willful misfeasance,
bad faith, gross negligence, or reckless disregard of the duties involved in the
conduct of his or her office. Voting rights are not cumulative, which means that
the holders of more than 50% of the shares voting for the election of Trustees
can elect 100% of the Trustees and, in such event, the holders of the remaining
less than 50% of the shares voting on the matter will not be able to elect any
Trustees.

The Declaration of Trust provides that no person shall serve as a Trustee if
shareholders holding two-thirds of the outstanding shares have removed him from
that office either by a written declaration filed with the Fund's custodian or
by votes cast at a meeting called for that purpose. The Declaration of Trust
further provides that the Trustees of the Fund shall promptly call a meeting of
the shareholders for the purpose of voting upon a question of removal of any
such Trustee or Trustees when requested in writing to do so by the record
holders of not less than 10 per centum of the outstanding shares.

The Fund's Prospectus and this SAI do not contain all of the information set
forth in the Registration Statement that the Fund has filed with the SEC. The
complete Registration Statement may be obtained from the SEC upon payment of the
fee prescribed by its Rules and Regulations.

Independent registered public accounting firm

Deloitte & Touche LLP, Boston, Massachusetts are the independent registered
public accounting firm for the Fund, providing audit services, tax return
preparation, and assistance and consultation with respect to the preparation of
filings with the SEC.

--------------------------------------------------------------------------------
                                                                              27
<PAGE>

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM REPORT

[TO BE ADDED BY AMENDMENT]

--------------------------------------------------------------------------------
 28
<PAGE>

--------------------------------------------------------------------------------

Eaton Vance Enhanced Equity Income Fund II

STATEMENT OF ASSETS AND LIABILITIES
[          ], 2004

<Table>
<S>                                                           <C>
ASSETS
  Cash......................................................  $
  Offering costs............................................
  Receivable from Adviser...................................
                                                              --------
  Total assets..............................................  $
                                                              ========
LIABILITIES
  Accrued offering costs....................................  $
  Accrued organizational costs..............................
  Total liabilities.........................................  $
                                                              ========
Net assets applicable to [    ] common shares of beneficial
  interest issued and outstanding...........................  $
                                                              ========
NET ASSET VALUE AND OFFERING PRICE PER SHARE................  $
                                                              ========
</Table>

STATEMENT OF OPERATIONS
PERIOD FROM [          ], 2004 (DATE OF ORGANIZATION) THROUGH [          ], 2004

<Table>
<S>                                                           <C>
INVESTMENT INCOME...........................................  $     --
                                                              --------
EXPENSES
  Organization costs........................................  $
  Expense reimbursement.....................................      (  )
                                                              --------
     Net expenses...........................................  $     --
                                                              --------
NET INVESTMENT INCOME.......................................  $     --
                                                              ========
</Table>

                       See notes to financial statements.

--------------------------------------------------------------------------------
                                                                              29
<PAGE>

Notes to financial statements

NOTE 1:  ORGANIZATION

The Eaton Vance Enhanced Equity Income Fund II (the "Fund") was organized as a
Massachusetts business trust on [     ], 2004, and has been inactive since that
date except for matters relating to its organization and registration as a
diversified, closed-end management investment company under the Investment
Company Act of 1940, as amended, and the Securities Act of 1933, as amended, and
the sale of [     ] common shares to Eaton Vance Management, the Fund's
Investment Adviser.

Eaton Vance Management, or an affiliate, has agreed to reimburse all
organizational costs, estimated at approximately $[     ].

Eaton Vance Management, or an affiliate, has agreed to pay all offering costs
(other than sales loads) that exceed $0.04 per common share. Based on an
offering size of $[     ] the Fund has estimated the cost of the offering to be
approximately $[     ] all of which would be paid by the Fund. Any amount in
excess of $[     ] would be paid by Eaton Vance Management.

The Fund's primary investment objective is to provide current income, with a
secondary objective of capital appreciation. The Fund will pursue its investment
objectives by investing primarily in a portfolio of mid- and
large-capitalization common stocks, seeking to invest primarily in components
with above-average growth and financial strength . Under normal market
conditions, the Fund will seek to generate current earnings from option premiums
by selling covered call options on a substantial portion of its portfolio
securities. There can be no assurance that the Fund will achieve its investment
objectives.

NOTE 2:  ACCOUNTING POLICIES

The Fund's financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America which require the
use of management estimates. Actual results may differ from those estimates.

The Fund's share of offering costs will be recorded within paid in capital as a
reduction of the proceeds from the sale of common shares upon the commencement
of Fund operations. The offering costs reflected above assume the sale of
[          ] common shares.

NOTE 3:  INVESTMENT MANAGEMENT AGREEMENT

Pursuant to an investment advisory agreement between the Adviser and the Fund,
the Fund has agreed to pay an investment advisory fee, payable on a monthly
basis, at an annual rate of [     ]% of the average daily gross assets of the
Fund. Gross assets of the Fund shall be calculated by deducting accrued
liabilities of the Fund not including the amount of any preferred shares
outstanding or the principal amount of any indebtedness for money borrowed.

Pursuant to a sub-advisory agreement among the Fund, the Adviser and Rampart
Investment Management Company, Inc., the Adviser has agreed to pay a
sub-advisory fee, in an annual amount equal to [     ]% of the average daily
gross assets of the Fund.

NOTE 4:  FEDERAL INCOME TAXES

The Fund intends to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its
taxable income, including any net realized gain on investments.

--------------------------------------------------------------------------------
 30
<PAGE>

                   EATON VANCE ENHANCED EQUITY INCOME FUND II

                      STATEMENT OF ADDITIONAL INFORMATION
                              [          ], 200[ ]

                             ---------------------

                      INVESTMENT ADVISER AND ADMINISTRATOR
                             Eaton Vance Management
                                255 State Street
                                Boston, MA 02109

                                  SUB-ADVISER
                  Rampart Investment Management Company, Inc.
                            One International Place
                                Boston, MA 02110

                                   CUSTODIAN
                         Investors Bank & Trust Company
                              200 Clarendon Street
                                Boston, MA 02116

                                 TRANSFER AGENT
                                   PFPC Inc.
                                 P.O. Box 43027
                           Providence, RI 02940-3027
                                 (800) 331-1710

                 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                             Deloitte & Touche LLP
<PAGE>

                                     PART C

                                OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(1)      FINANCIAL STATEMENTS:

         Included in Part A:
         Not applicable.

         Included in Part B:
         Independent Auditor's Report*
         Statement of Assets and Liabilities*
         Notes to Financial Statement*

----------------------------
*To be added by amendment.

(2)   EXHIBITS:

      (a)   Agreement and Declaration of Trust dated November 8, 2004 is
            incorporated herein by reference to the Registrant's initial
            Registration Statement on Form N-2 (File Nos. 333-120421 and
            811-21670) as to the Registrant's common shares of beneficial
            interest ("Common Shares") filed with the Securities and Exchange
            Commission on November 12, 2004 (Accession No. 0000898432-04-000944)
            ("Initial Common Shares Registration Statement").

      (b)   By-Laws are incorporated herein by reference to the Registrant's
            Initial Common Shares Registration Statement.

      (c)   Not applicable.

      (d)   Form of Specimen Certificate for Common Shares of Beneficial
            Interest filed herein.

      (e)   Dividend Reinvestment Plan filed herein.

      (f)   Not applicable.

      (g)   (1)   Investment Advisory Agreement dated December 20, 2004, filed
                  herein.

            (2)   Sub-Advisory Agreement dated December 20, 2004, filed herein.

      (h)   (1)   Form of Underwriting Agreement filed herein.

            (2)   Form of Master Agreement Among Underwriters filed herein.

            (3)   Form of Master Selected Dealers Agreement filed herein.

<PAGE>

      (i)   The Securities and Exchange Commission has granted the Registrant an
            exemptive order that permits the Registrant to enter into deferred
            compensation arrangements with its independent Trustees. See in the
            matter of Capital Exchange Fund, Inc., Release No. IC- 20671
            (November 1, 1994).

      (j)   (1)   Master Custodian Agreement with Investors Bank & Trust Company
                  dated December 20, 2004 filed herein.

            (2)   Extension Agreement dated August 31, 2000 to Master Custodian
                  Agreement with Investors Bank & Trust Company filed as Exhibit
                  (g)(4) to Post-Effective Amendment No. 85 of Eaton Vance
                  Municipals Trust (File Nos. 33-572, 811-4409) filed with the
                  Commission on January 23, 2001 (Accession No.
                  0000940394-01-500027) and incorporated herein by reference.

            (3)   Delegation Agreement dated December 11, 2000, with Investors
                  Bank & Trust Company filed as Exhibit (j)(e) to the Eaton
                  Vance Prime Rate Reserves N-2, Amendment No. 5 (File Nos.
                  333-32267, 811-05808) filed April 3, 2002 (Accession No.
                  0000940394-01-500126) and incorporated herein by reference.

      (k)   (1)   Supplement to the Transfer Agency and Services Agreement dated
                  December 20, 2004 filed herein.

            (2)   Transfer Agency and Services Agreement as amended and restated
                  on June 16, 2003, filed as Exhibit (k)(2) to the Registration
                  Statement of Eaton Vance Tax-Advantaged Dividend Income Fund
                  (File Nos. 333- 107050 and 811-21400) filed July 15, 2003
                  (Accession No. 0000898432- 03- 000638) and incorporated herein
                  by reference.

            (3)   Administration Agreement dated December 20, 2004 filed herein.

            (4)   Form of Shareholder Servicing Agreement filed herein.

            (5)   Form of Additional Compensation Agreement filed herein.

      (l)   Opinion and Consent of Kirkpatrick & Lockhart LLP as to Registrant's
            Common Shares to be filed by amendment.

      (m)   Not applicable.

      (n)   Consent of Independent Registered Public Accounting Firm filed
            herein.

      (o)   Not applicable.

      (p)   Letter Agreement with Eaton Vance Management to be filed by
            amendment.

      (q)   Not applicable.

<PAGE>

      (r)   (1)   Code of Ethics adopted by Eaton Vance Corp., Eaton Vance
                  Management, Boston Management and Research, Eaton Vance
                  Distributors, Inc. and the Eaton Vance Funds effective
                  September 1, 2000, as revised June 4, 2002, filed as Exhibit
                  (p) to Post- Effective Amendment No. 45 of Eaton Vance
                  Investment Trust (File Nos. 33-1121, 811-4443) filed July 24,
                  2002 (Accession No. 0000940394-02-000462) and incorporated
                  herein by reference.

      (2)   Code of Ethics adopted by Rampart Investment Management Company,
            Inc. Code of Ethics adopted by Rampart Investment Management
            Company, Inc. effective September 1, 2004 filed as Exhibit (r)(2) to
            Pre-Effective Amendment No.1 of Eaton Vance Enhanced Equity Income
            Fund (File Nos. 333-118180 and 811-21614) filed September 24, 2004
            (Accession No. 0000950135-04-004565 and incorporated herein by
            reference.

      (s)   Power of Attorney dated December 20, 2004 filed herein.

ITEM 25. MARKETING ARRANGEMENTS

      See Form of Underwriting Agreement filed herein.

ITEM 26. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

      The approximate expenses in connection with the offering are as follows:

<TABLE>
<S>                                                     <C>
Registration and Filing Fees                            $_________________
National Association of Securities Dealers, Inc. Fees
New York Stock Exchange Fees
Costs of Printing and Engraving
Accounting Fees and Expenses
Legal Fees and Expenses                                         250,000.00
                                                        ==================
Total                                                   $_________________
</TABLE>

ITEM 27  PERSONS CONTROLLED BY OR UNDER COMMON CONTROL

      None.

ITEM 28. NUMBER OF HOLDERS OF SECURITIES

      Set forth below is the number of record holders as of [       ], 2004,
of each class of securities of the Registrant:

<TABLE>
<CAPTION>
                Title of Class                               Number of Record Holders
-----------------------------------------------              ------------------------
<S>                                                          <C>
Common Shares of Beneficial interest, par value                         0
$0.01 per share
</TABLE>

<PAGE>

ITEM 29. INDEMNIFICATION

      The Registrant's By-Laws filed in the Registrant's Initial Common Shares
Registration Statement contain and the form of Underwriting Agreement filed
herein contains provisions limiting the liability, and providing for
indemnification, of the Trustees and officers under certain circumstances.

      Registrant's Trustees and officers are insured under a standard investment
company errors and omissions insurance policy covering loss incurred by reason
of negligent errors and omissions committed in their official capacities as
such. Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act"), may be permitted to directors,
officers and controlling persons of the Registrant pursuant to the provisions
described in this Item 29, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

ITEM 30. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

      Reference is made to: (i) the information set forth under the caption
Investment advisory and other services" in the Statement of Additional
Information; (ii) the Eaton Vance Corp. 10-K filed under the Securities Exchange
Act of 1934 (File No. 001-8100); (iii) the Form ADV of Eaton Vance Management
(File No. 801-15930); and (iv) the Form ADV of Rampart Investment Management
Company, Inc. (File No. 801-20657) filed with the Commission, all of which are
incorporated herein by reference.

ITEM 31. LOCATION OF ACCOUNTS AND RECORDS

      All applicable accounts, books and documents required to be maintained by
the 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, 200 Clarendon Street,
16th Floor, Boston, MA 02116, and its transfer agent, PFPC Inc., 4400 Computer
Drive, Westborough, MA 01581-5120, with the exception of certain corporate
documents and portfolio trading documents which are in the possession and
custody of Eaton Vance Management, The Eaton Vance Building, 255 State Street,
Boston, MA 02109. 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 Eaton Vance Management.

ITEM 32. MANAGEMENT SERVICES

      Not applicable.

<PAGE>

ITEM 33. UNDERTAKINGS

      1. The Registrant undertakes to suspend offering of Common Shares until
the prospectus is amended if (1) subsequent to the effective date of this
Registration Statement, the net asset value declines more than 10 percent from
its net asset value as of the effective date of this Registration Statement or
(2) the net asset value increases to an amount greater than its net proceeds as
stated in the prospectus.

      2. Not applicable.

      3. Not applicable.

      4. Not applicable.

      5. The Registrant undertakes that:

            a. for the purpose of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in the form of
prospectus filed by the Registrant pursuant to 497(h) under the Securities Act
shall be deemed to be part of the Registration Statement as of the time it was
declared effective; and

            b. for the purpose of determining any liability under the Securities
Act, each post- effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

      6. The Registrant undertakes to send by first class mail or other means
designed to ensure equally prompt delivery, within two business days of receipt
of an oral or written request, its Statement of Additional Information.

                  [Remainder of page left intentionally blank]

<PAGE>

                                     NOTICE

      A copy of the Agreement and Declaration of Trust of Eaton Vance Enhanced
Equity Income Fund II is on file with the Secretary of the Commonwealth of
Massachusetts and notice is hereby given that this instrument is executed on
behalf of the Registrant by an officer of the Registrant as an officer and not
individually and that the obligations of or arising out of this instrument are
not binding upon any of the Trustees, officers or shareholders individually, but
are binding only upon the assets and property of the Registrant.

                  [Remainder of page left intentionally blank]

<PAGE>

                                   SIGNATURES

      Pursuant to the requirements of the Securities Act of 1933, as amended and
the Investment Company Act of 1940, as amended the Registrant has duly caused
this Pre-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Boston and
the Commonwealth of Massachusetts, on the 21st day of December 2004.

                              EATON VANCE ENHANCED
                              EQUITY INCOME FUND II

                              By:   /s/ Duncan W. Richardson
                                    -------------------------------------------
                                    Duncan W. Richardson
                                    President and Chief Executive Officer

      Pursuant to the requirements of the Securities Act of 1933, as amended
this Pre-Effective Amendment to the Registration Statement has been signed by
the following persons in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
       Signature                                            Title                                    Date
-------------------------                     -------------------------------------           -----------------
<S>                                           <C>                                             <C>
/s/ Duncan W. Richardson                      President and Chief Executive Officer           December 21, 2004
------------------------
Duncan W. Richardson

/s/ James L. O'Connor                         Treasurer and Principal Financial and           December 21, 2004
---------------------                         Accounting Officer
James L. O'Connor

/s/ James B. Hawkes                           Trustee                                         December 21, 2004
-------------------
James B. Hawkes

Samuel L. Hayes III*                          Trustee                                         December 21, 2004
--------------------
Samuel L. Hayes

William H. Park*                              Trustee                                         December 21, 2004
----------------
William H. Park

Ronald A. Pearlman*                           Trustee                                         December 21, 2004
-------------------
Ronald A. Pearlman

Norton H. Reamer*                             Trustee                                         December 21, 2004
-----------------
Norton H. Reamer

Lynn A. Stout*                                Trustee                                         December 21, 2004
--------------
Lynn A. Stout
</TABLE>

*By: /s/Alan R. Dynner.
------------------------
Alan R. Dynner
(As Attorney-in-Fact)


<PAGE>

                                INDEX TO EXHIBITS

      (d)    Form of Specimen Certificate

      (e)    Dividend Reinvestment Plan

      (g)(1) Investment Advisory Agreement

      (g)(2) Sub-Advisory Agreement

      (h)(1) Form of Underwriting Agreement

      (h)(2) Form of Master Agreement Among Underwriters

      (h)(3) Form of Master Selected Dealers Agreement

      (j)(1) Master Custodian Agreement

      (k)(1) Supplement to the Transfer Agency and Services Agreement

      (k)(3) Administration Agreement

      (k)(4) Form of Shareholder Servicing Agreement

      (k)(5) Form of Additional Compensation Agreement

      (n)    Consent of Independent Registered Public Accounting Firm

      (s)    Power of Attorney dated December 20, 2004

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(D)
<SEQUENCE>2
<FILENAME>b52674a1exv99wxdy.txt
<DESCRIPTION>EX-(D) FORM OF SPECIMEN CERTIFICATE
<TEXT>
<PAGE>
                                                                     Exhibit (d)



SPECIMEN CERTIFICATE ONLY

CERTIFICATE                                                          NUMBER OF
  NUMBER                                                               SHARES


-----------                                                          -----------


                   EATON VANCE ENHANCED EQUITY INCOME FUND II
          Organized Under the Laws of The Commonwealth of Massachusetts
                                  Common Shares
                            $.01 Par Value Per Share

                                                     Cusip No.
                                                               -----------------


         This certifies that                          is the owner of
                             ------------------------
                         fully paid and non-assessable shares of Common Shares,
------------------------
$.01 par value per share, of Eaton Vance Enhanced Equity Income Fund II (the
"Fund") transferable only on the books of the Fund by the holder thereof in
person or by duly authorized Attorney upon surrender of this Certificate
properly endorsed. This Certificate is not valid unless countersigned by the
transfer agent and registrar.

         A statement in full, of all the designations, preferences,
qualifications, limitations, restrictions and special or relative rights of the
shares of each class authorized to be issued, will be furnished by the Fund to
any shareholders upon request and without charge.

         IN WITNESS WHEREOF, the Fund has caused this Certificate to be signed
by its duly authorized officers and its Seal to be hereunto affixed this
        day of                           A.D. 2005.
-------        -------------------------

INVESTORS BANK & TRUST COMPANY         EATON VANCE ENHANCED EQUITY INCOME FUNDII
As Transfer Agent and Registrar


By:                                    By:
      --------------------------               ---------------------------------
      Authorized Signature                     President

                                       Attest:
                                               ---------------------------------
                                               Secretary


<PAGE>

         FOR VALUE RECEIVED,                                      hereby sells,
                             ------------------------------------
assigns and transfers unto                               Shares represented by
                           -----------------------------
this Certificate, and do hereby irrevocably constitute and appoint
                                                                   -------------
Attorney to transfer the said Shares on the books of the within named Fund with
full power of substitution in the premises.

Dated                          ,
      -------------------------  ----------
In presence of

------------------------------------        ------------------------------------

                                    Shares of Common Shares evidenced by this
                                    Certificate may be sold, transferred, or
                                    otherwise disposed of only pursuant to the
                                    provisions of the Fund's Agreement and
                                    Declaration of Trust, as amended, a copy of
                                    which may be at the office of the Secretary
                                    of the Commonwealth of Massachusetts.

                                    The Fund will furnish to any shareholder,
                                    upon request and without charge, a full
                                    statement of the designations, preferences,
                                    limitations and relative rights of the
                                    shares of each class of series of capital
                                    stock of the Fund authorized to be issued,
                                    so far as they have been determined, and the
                                    authority of the Board of Trustees to
                                    determine the relative rights and
                                    preferences of subsequent classes or series.
                                    Any such request should be addressed to the
                                    Secretary of the Fund.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(E)
<SEQUENCE>3
<FILENAME>b52674a1exv99wxey.txt
<DESCRIPTION>EX-(E) DIVIDEND REINVESTMENT PLAN
<TEXT>
<PAGE>
                                                                     EXHIBIT (e)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II
               TERMS AND CONDITIONS OF DIVIDEND REINVESTMENT PLAN

     Holders of common  shares (the  "Shares")  of Eaton Vance  Enhanced  Equity
Income Fund II (the "Fund") who participate (the  "Participants")  in the Fund's
Dividend Reinvestment Plan (the "Plan") are advised as follows:

     1. THE PLAN  AGENT.  PFPC  Inc.  (the  "Agent")  will act as Agent for each
Participant.  The Agent will open an account for each Participant under the Plan
in the same name as his or her outstanding Shares are registered.

     2.  ELECTION  TO  PARTICIPATE.  A  Shareholder  may  elect to  receive  all
distributions  ("Distributions")  payable  with  respect to his or her Shares in
additional  Shares.  To participate in the Plan and receive all Distributions in
Shares,  a Shareholder  must indicate his or her election to do so by completing
and returning to the Plan Agent a Dividend  Reinvestment  Plan Application Form.
Shareholders  who do not  elect to  participate  in the Plan by  completing  and
returning such Form will receive Distributions in cash paid directly by the Plan
Agent as dividend disbursing agent for the applicable Fund.

     3. MARKET PREMIUM ISSUANCES. If on the payment date for a Distribution, the
net asset  value per Share is equal to or less than the  market  price per Share
plus  estimated  brokerage  commissions,  the Agent shall  receive  newly issued
Shares,  including fractions,  from the Fund for each Participant's account. The
number of additional  Shares to be credited  shall be determined by dividing the
dollar  amount of the  Distribution  by the  greater of the net asset  value per
Share on the payment date, or 95% of the then current market price per Share.

     4. MARKET DISCOUNT PURCHASES.  If the net asset value per Share exceeds the
market  price plus  estimated  brokerage  commissions  on the payment date for a
Distribution,  the  Agent  (or a  broker-dealer  selected  by the  Agent)  shall
endeavor,  for a  purchase  period  of 30 days,  to  apply  the  amount  of such
Distribution  on each  Participant's  Shares  (less  their  pro  rata  share  of
brokerage  commissions  incurred)  to purchase  Shares on the open  market.  The
weighted average price (including brokerage commissions) of all Shares purchased
by  the  Agent  as  Agent  shall  be the  price  per  Share  allocable  to  each
Participant.  If, at the close of business on any day during the purchase period
on which net asset value per Share is calculated  such net asset value equals or
is less than the market price per Share plus  estimated  brokerage  commissions,
the Agent will cease open-market  purchases,  and the uninvested portion of such
Distribution shall be filled through the issuance of new Shares from the Fund at
the price set forth in Paragraph 3 above.  Open-market  purchases may be made on
any securities exchange where Shares are traded, in the over-the-counter  market
or in negotiated  transactions,  and may be on such terms as to price,  delivery
and otherwise as the Agent shall determine.

     5. VALUATION.  The market price of Shares on a particular date shall be the
last sales price on the Exchange  where the Shares are listed on that date,  or,
if there is no sale on such  Exchange  on that date,  then the mean  between the
closing bid and asked  quotations on such  Exchange on such date.  The net asset
value  per  Share  on a  particular  date  shall  be the  amount  most  recently
calculated by or on behalf of the Fund as required by law.

     6.  LIABILITY OF AGENT.  The Agent shall at all times act in good faith and
agree to use its best efforts within reasonable limits to ensure the accuracy of
all services  performed  under this Agreement and to comply with applicable law,
but assumes no responsibility  and shall not be liable for loss or damage due to
errors  unless such error is caused by the  Agent's  negligence,  bad faith,  or
willful misconduct or that of its employees. Each Participant's uninvested funds
held by the Agent will not bear  interest.  The Agent shall have no liability in
connection  with any inability to purchase  Shares within the time provided,  or
<PAGE>
with  the  timing  of  any   purchases   effected.   The  Agent  shall  have  no
responsibility  for the  value  of  Shares  acquired.  For the  purpose  of cash
investments, the Agent may commingle Participants' funds (of the same Fund).

     7.  RECORDKEEPING.  The Agent may hold each  Participant's  Shares acquired
pursuant to the Plan together with the Shares of other  shareholders of the Fund
acquired  pursuant to the Plan in  noncertificated  form in the Agent's  name or
that of the Agent's nominee.  Upon a Participant's  written  request,  the Agent
will deliver to the  Participant,  without charge, a certificate or certificates
for the full shares.  Each  Participant will be sent a confirmation by the Agent
of each acquisition made for their account as soon as practicable, but not later
than 60 days after the date thereof.  Although each Participant may from time to
time  have  an  undivided  fractional  interest  in a  share  of  the  Fund,  no
certificates for a fractional share will be issued.  Distributions on fractional
shares  will  be  credited  to  each  Participant's  account.  In the  event  of
termination of a Participant's account under the Plan, the Agent will adjust for
any such undivided  fractional interest in cash at the market value of Shares at
the time of termination.

     Any share dividends or split shares  distributed by the Fund on Shares held
by the Agent for Participants  will be credited to their accounts.  In the event
that the Fund makes available to its shareholders  rights to purchase additional
shares of other securities,  the Shares held for each Participant under the Plan
will be added to other shares held by the  Participant in calculating the number
of rights to be issued to each Participant.

     8. PROXY  MATERIALS.  The Agent will forward to each  Participant any proxy
solicitation  material  and will vote any  shares  so held for each  Participant
first in accordance with the  instructions  set forth on proxies returned by the
Participant  to the Fund,  and then with  respect to any proxies not returned by
the  Participant  to the Fund in the same  portion  as the Agent  votes  proxies
returned by the Participants to the Fund.

     9. FEES. The Agent's service fee for handling Distributions will be paid by
the Fund.  Each  Participant  will be charged  their pro rata share of brokerage
commissions on all open-market  purchases.  If a Participant elects by notice to
the Agent to have the Agent  sell part or all of his or her Shares and remit the
proceeds,  the  Agent  is  authorized  to  deduct  a $5.00  fee  plus  brokerage
commissions from the proceeds.

     10. TERMINATION IN THE PLAN. Each registered  Participant may terminate his
or her  account  under the Plan by  notifying  the Agent in writing at P.O.  Box
43027,  Providence,  RI  02940-3027,  or  by  telephone  at  800-331-1710.  Such
termination   will  be  effective  with  respect  to  a   Distribution   if  the
Participant's  notice is received by the Agent prior to the Distribution  record
date. The Plan may be terminated by the Agent or the Fund upon notice in writing
mailed to each  Participant  at least 30 days prior to any  record  date for the
payment  of any  Distribution.  Upon any  termination,  the Agent  will  cause a
certificate  or  certificates  to be issued  for the full  shares  held for each
Participant  under the Plan and cash adjustment for any fraction to be delivered
to them without charge.

     11. AMENDMENT OF THE PLAN. These terms and conditions may be amended by the
Agent,  or the  Fund  at any  time  or  times  but,  except  when  necessary  or
appropriate  to  comply  with  applicable  law or the rules or  policies  of the
Securities and Exchange  Commission or any other regulatory  authority,  only by
mailing to each Participant appropriate written notice at least 30 days prior to
the effective date thereof. The amendment shall be deemed to be accepted by each
Participant  unless,  prior to the effective  date thereof,  the Agent  receives
notice of the termination of the Participant's  account under the Plan. Any such
amendment may include an appointment by the Agent of a successor Agent.

     12.  APPLICABLE  LAW. These terms and  conditions  shall be governed by the
laws of The Commonwealth of Massachusetts.


                                       2

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(G)(1)
<SEQUENCE>4
<FILENAME>b52674a1exv99wxgyx1y.txt
<DESCRIPTION>EX-(G)(1)INVESTMENT ADVISORY AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (g)(1)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II
                          INVESTMENT ADVISORY AGREEMENT

     AGREEMENT  made  this  20th day of  December,  2004,  between  Eaton  Vance
Enhanced  Equity Income Fund II, a  Massachusetts  business trust (the "Trust"),
and Eaton Vance Management, a Massachusetts business trust (the "Adviser").

     1. DUTIES OF THE ADVISER.  The Trust  hereby  employs the Adviser to act as
investment  adviser for and to manage the  investment  and  reinvestment  of the
assets of the Trust and to administer its affairs, subject to the supervision of
the  Trustees  of the  Trust,  for the period and on the terms set forth in this
Agreement.

     The Adviser hereby accepts such employment, and undertakes to afford to the
Trust the advice and assistance of the Adviser's  organization  in the choice of
investments  and in the  purchase  and sale of  securities  for the Trust and to
furnish  for  the  use of the  Trust  office  space  and  all  necessary  office
facilities,  equipment and personnel for servicing the  investments of the Trust
and to pay the  salaries  and fees of all officers and Trustees of the Trust who
are  members of the  Adviser's  organization  and all  personnel  of the Adviser
performing services relating to research and investment activities.  The Adviser
shall for all  purposes  herein be deemed to be an  independent  contractor  and
shall, except as otherwise  expressly provided or authorized,  have no authority
to act for or represent  the Trust in any way or otherwise be deemed an agent of
the Trust.

     The Adviser shall  provide the Trust with such  investment  management  and
supervision as the Trust may from time to time consider necessary for the proper
supervision of the Trust. As investment  adviser to the Trust, the Adviser shall
furnish continuously an investment program and shall determine from time to time
what  securities  and  other  investments  shall  be  acquired,  disposed  of or
exchanged  and what  portion of the  Trust's  assets  shall be held  uninvested,
subject  always to the  applicable  restrictions  of the  Declaration  of Trust,
By-Laws and  registration  statement  of the Trust.  Should the  Trustees of the
Trust at any time,  however,  make any specific  determination  as to investment
policy for the Trust and notify the  Adviser  thereof in  writing,  the  Adviser
shall be bound by such  determination for the period, if any,  specified in such
notice or until similarly notified that such determination has been revoked. The
Adviser shall take, on behalf of the Trust,  all actions that it deems necessary
or desirable to implement the investment policies of the Trust.

     The Adviser  shall place all orders for the  purchase or sale of  portfolio
securities for the account of the Trust either  directly with the issuer or with
brokers or dealers  selected by the  Adviser,  and, to that end,  the Adviser is
authorized,  as the agent of the Trust, to give instructions to the custodian of
the Trust as to deliveries of securities and payments of cash for the account of
the Trust.  In connection  with the selection of such brokers or dealers and the
placing of such orders,  the Adviser shall adhere to  procedures  adopted by the
Board of Trustees of the Trust.

     The  Adviser  shall  not  be  responsible  for  providing  certain  special
administrative  services  to  the  Trust  under  this  Agreement.   Eaton  Vance
Management,  in its capacity as Administrator of the Trust, shall be responsible
for  providing   such   services  to  the  Trust  under  the  Trust's   separate
Administration Agreement.
<PAGE>
     2. COMPENSATION OF THE ADVISER.  For the services,  payments and facilities
to be  furnished  hereunder  by the  Adviser,  the Adviser  shall be entitled to
receive from the Trust  compensation in an amount equal to 1.00% annually of the
average  daily gross  assets of the Trust.  (For  purposes of this  calculation,
"gross assets" of the Trust shall mean total assets of the Trust,  including any
form of investment  leverage,  minus all accrued expenses incurred in the normal
course  of  operations,   but  not  excluding  any  liabilities  or  obligations
attributable to investment  leverage  obtained  through (i)  indebtedness of any
type (including, without limitation,  borrowing through a credit facility or the
issuance debt securities), (ii) the issuance of preferred stock or other similar
preference  securities,  (iii)  the  reinvestment  of  collateral  received  for
securities  loaned in  accordance  with the Trust's  investment  objectives  and
policies, and/or (iv) any other means.)

     Such compensation shall be paid monthly in arrears on the last business day
of each month.  The Trust's net assets shall be computed in accordance  with the
Declaration of Trust of the Trust and any applicable votes and determinations of
the Trustees of the Trust.

     In case of initiation or termination of the Agreement during any month, the
fee for that month shall be reduced  proportionately  on the basis of the number
of calendar  days during  which the  Agreement is in effect and the fee shall be
computed  upon the basis of the average  gross assets for the business  days the
Agreement is so in effect for that month.

     The  Adviser  may,  from  time to time,  waive  all or a part of the  above
compensation.

     3. ALLOCATION OF CHARGES AND EXPENSES. It is understood that the Trust will
pay all expenses other than those expressly  stated to be payable by the Adviser
hereunder,  which expenses  payable by the Trust shall include,  without implied
limitation (i) expenses of  maintaining  the Trust and continuing its existence;
(ii)  registration of the Trust under the Investment  Company Act of 1940; (iii)
commissions,  spreads,  fees and other expenses  connected with the acquisition,
holding and  disposition  of securities  and other  investments;  (iv) auditing,
accounting and legal expenses;  (v) taxes and interest;  (vi) governmental fees;
(vii)  expenses  of  listing  shares of the  Trust  with a stock  exchange,  and
expenses of issue, sale,  repurchase and redemption (if any) of interests in the
Trust,  including  expenses  of  conducting  tender  offers  for the  purpose of
repurchasing Trust interests;  (viii) expenses of registering and qualifying the
Trust and its shares under  federal and state  securities  laws and of preparing
and filing  registration  statements  and  amendments  for such  purposes;  (ix)
expenses of reports and notices to shareholders  and of meetings of shareholders
and proxy  solicitations  therefore;  (x)  expenses  of reports to  governmental
officers and commissions;  (xi) insurance expenses; (xii) association membership
dues;  (xiii) fees,  expenses and  disbursements of custodians and subcustodians
for all services to the Trust  (including,  without  limitation,  safekeeping of
funds, securities and other investments, keeping of books, accounts and records,
and determination of net asset values);  (xiv) fees,  expenses and disbursements
of transfer agents, dividend disbursing agents, shareholder servicing agents and
registrars  for  all  services  to  the  Trust;   (xv)  expenses  for  servicing
shareholder  accounts;  (xvi) any direct charges to shareholders approved by the
Trustees of the Trust; (xvii) compensation and expenses of Trustees of the Trust
who are not members of the Adviser's organization; (xviii) pricing and valuation
services  employed by the Trust;  (xix) all expenses incurred in connection with
leveraging  of  Trust's  assets  through  a  line  of  credit,  or  issuing  and
maintaining  preferred shares; and (xx) such  non-recurring  items as may arise,
including  expenses  incurred in connection  with  litigation,  proceedings  and
claims and the  obligation of the Trust to indemnify its Trustees,  officers and
shareholders with respect thereto.

                                       2
<PAGE>
     4. OTHER  INTERESTS.  It is  understood  that  Trustees and officers of the
Trust and  shareholders  of the Trust are or may be or become  interested in the
Adviser as trustees,  officers,  employees,  shareholders  or otherwise and that
trustees,  officers  and  shareholders  of the  Adviser  are or may be or become
similarly  interested  in the  Trust,  and that  the  Adviser  may be or  become
interested in the Trust as a shareholder  or  otherwise.  It is also  understood
that trustees,  officers,  employees and  shareholders  of the Adviser may be or
become interested (as directors, trustees, officers, employees,  shareholders or
otherwise) in other companies or entities (including,  without limitation, other
investment companies) that the Adviser may organize, sponsor or acquire, or with
which it may merge or consolidate, and which may include the words "Eaton Vance"
or any  combination  thereof as part of their name,  and that the Adviser or its
subsidiaries  or affiliates may enter into advisory or management  agreements or
other contracts or relationships with such other companies or entities.

     5.  LIMITATION OF LIABILITY OF THE ADVISER.  The services of the Adviser to
the Trust are not to be deemed to be exclusive, the Adviser being free to render
services to others and engage in other  business  activities.  In the absence of
willful  misfeasance,  bad faith,  gross  negligence  or reckless  disregard  of
obligations  or duties  hereunder on the part of the Adviser,  the Adviser shall
not be subject to liability to the Trust or to any  shareholder of the Trust for
any act or  omission in the course of, or  connected  with,  rendering  services
hereunder or for any losses that may be sustained in the acquisition, holding or
disposition  of any interest in a Loan or of any  security,  investment or other
asset.

     6.   SUB-INVESTMENT   ADVISERS.   The   Adviser  may  employ  one  or  more
sub-investment  advisers  from  time to time to  perform  such of the  acts  and
services of the Adviser provided for by this Agreement,  including the selection
of brokers or dealers to execute the Trust's  portfolio  security  transactions,
and upon such terms and conditions as may be agreed upon between the Adviser and
such  sub-investment  adviser and approved by the Trustees of the Trust,  all as
permitted by the Investment  Company Act of 1940.  This provision does not limit
the  Adviser's  ability,  pursuant to this  Agreement,  to provide the  services
contemplated  without the  assistance  of a  sub-investment  adviser.  Moreover,
subject to approval  of the  Trust's  Board of  Trustees,  the  Adviser  retains
complete  authority at any time immediately to assume direct  responsibility for
any function  delegated to a  sub-investment  adviser pursuant to this Section 6
without the need for any approval by the holders of the voting securities of the
Trust.

     7. DURATION AND TERMINATION OF THIS AGREEMENT.  This Agreement shall become
effective  upon the date of its  execution,  and,  unless  terminated  as herein
provided,  shall remain in full force and effect through and including  December
20, 2006 and shall  continue in full force and effect  indefinitely  thereafter,
but only so long as such  continuance  after  December 20, 2006 is  specifically
approved at least  annually (i) by the Board of Trustees of the Trust or by vote
of a majority of the outstanding  voting securities of the Trust and (ii) by the
vote of a majority of those Trustees of the Trust who are not interested persons
of the  Adviser or the Trust cast in person at a meeting  called for the purpose
of voting on such approval.

     Either  party  hereto may,  at any time on sixty (60) days'  prior  written
notice to the  other,  terminate  this  Agreement  without  the  payment  of any
penalty,  by action of Trustees of the Trust or the trustees of the Adviser,  as
the case may be, and the Trust may, at any time upon such written  notice to the
Adviser,  terminate  this  Agreement  by vote of a majority  of the  outstanding
voting securities of the Trust. This Agreement shall terminate  automatically in
the event of its assignment.

     8. AMENDMENTS OF THE AGREEMENT.  This Agreement may be amended by a writing
signed by both parties  hereto,  provided  that no  amendment to this  Agreement
shall  be  effective  until  approved  (i) by the  vote of a  majority  of those
Trustees of the Trust who are not interested persons of the Adviser or the Trust
cast in person at a meeting  called for the purpose of voting on such  approval,
and (ii) by vote of a  majority  of the  outstanding  voting  securities  of the
Trust,  except for any such  amendment as may be effected in the absence of such
approval without violating the Investment Company Act of 1940.

                                       3
<PAGE>
     9.  LIMITATION  OF  LIABILITY.   The  Adviser  expressly  acknowledges  the
provision  in the  Declaration  of  Trust of the  Trust  limiting  the  personal
liability of the  Trustees,  officers  and  shareholders  of the Trust,  and the
Adviser  hereby  agrees that it shall have  recourse to the Trust for payment of
claims or obligations  as between the Trust and the Adviser  arising out of this
Agreement  and  shall  not  seek  satisfaction  from  any  Trustee,  officer  or
shareholders of the Trust.

     10. USE OF THE NAME "EATON VANCE".  The Adviser hereby  consents to the use
by the Trust of the name "Eaton  Vance" as part of the Trust's  name;  provided,
however,  that such consent  shall be  conditioned  upon the  employment  of the
Adviser or one of its  affiliates as the  investment  adviser of the Trust.  The
name  "Eaton  Vance" or any  variation  thereof may be used from time to time in
other  connections  and for other purposes by the Adviser and its affiliates and
other  investment  companies  that have obtained  consent to the use of the name
"Eaton  Vance".  The Adviser  shall have the right to require the Trust to cease
using the name "Eaton  Vance" as part of the Trust's  name if the Trust  ceases,
for any reason,  to employ the Adviser or one of its  affiliates  as the Trust's
investment  adviser.  Future names  adopted by the Trust for itself,  insofar as
such names include identifying words requiring the consent of the Adviser, shall
be the  property  of the  Adviser  and shall be  subject  to the same  terms and
conditions.

     11. CERTAIN  DEFINITIONS.  The terms "assignment" and "interested  persons"
when used herein shall have the respective  meanings specified in the Investment
Company Act of 1940 as now in effect or as hereafter  amended subject,  however,
to such  exemptions as may be granted by the Securities and Exchange  Commission
by  any  rule,  regulation  or  order.  The  term  "vote  of a  majority  of the
outstanding   voting   securities"   shall  mean  the  vote,  at  a  meeting  of
shareholders,  of the  lesser of (a) 67 per  centum or more of the shares of the
Trust present or represented by proxy at the meeting if the shareholders of more
than 50 per centum of the  shares of the Trust are  present  or  represented  by
proxy at the meeting, or (b) more than 50 per centum of the shares of the Trust.

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
executed on the day and year first above written.

                                      EATON VANCE ENHANCED EQUITY INCOME FUND II


                                      By: /s/ Duncan W. Richardson
                                          -------------------------------------
                                          President, and not Individually


                                      EATON VANCE MANAGEMENT


                                      By: /s/ Alan R. Dynner
                                          -------------------------------------
                                          Vice President, and not Individually




                                       4

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(G)(2)
<SEQUENCE>5
<FILENAME>b52674a1exv99wxgyx2y.txt
<DESCRIPTION>EX-(G)(2) SUB-ADVISORY AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (g)(2)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II
                        INVESTMENT SUB-ADVISORY AGREEMENT

AGREEMENT  effective  this  20th  day of  December,  2004  between  Eaton  Vance
Management,  a  Massachusetts  business  trust  (the  "Adviser"),   and  Rampart
Investment   Management   Company,   Inc.,  a  Massachusetts   corporation  (the
"Sub-Adviser").

WHEREAS,  Eaton Vance Enhanced Equity Income Fund II (the "Trust") is registered
under the  Investment  Company Act of 1940,  as amended (the "1940  Act"),  as a
closed-end, management investment company; and

WHEREAS,  pursuant to an Investment Advisory Agreement,  dated December 20, 2004
(the  "Advisory  Agreement"),   a  copy  of  which  has  been  provided  to  the
Sub-Adviser,  the  Trust  has  retained  the  Adviser  to  render  advisory  and
management services with regard to the Trust's options strategy; and

WHEREAS, pursuant to authority granted to the Adviser in the Advisory Agreement,
the Adviser  wishes to retain the  Sub-Adviser  to furnish  investment  advisory
services  to the  Trust  related  to  the  Trust's  options  strategy,  and  the
Sub-Adviser is willing to furnish such services to the Trust and the Adviser.

NOW,  THEREFORE,  in  consideration  of the premises and the promises and mutual
covenants herein contained, it is agreed between the Adviser and the Sub-Adviser
as follows:

     1.  APPOINTMENT.  The Adviser hereby appoints the Sub-Adviser to act as the
investment  adviser for and to manage the  investment  and  reinvestment  of the
assets of the Trust  related to the  Trust's  option  strategy  on the terms set
forth in this Agreement.  The Sub-Adviser accepts such appointment and agrees to
furnish  the  services  herein  set forth  herein  for the  compensation  herein
provided.  The  Sub-Adviser  shall not be responsible for aspects of the Trust's
investment program other than its option strategy,  including without limitation
purchases  and sales of securities  other than options,  selection of brokers to
conduct such  purchases and sales of securities  other than options,  compliance
with investment  policies and restrictions other than those concerning  options,
or proxy voting.

     2. SUB-ADVISER  DUTIES.  Subject to the supervision of the Trust's Board of
Trustees  (the  "Board")  and  the  Adviser,  the  Sub-Adviser  will  provide  a
continuous  investment  program  relating  to the  Trust's  purchase  or sale of
options for the Trust's portfolio.  Subject to approval of the Trust's Board and
notice to the Sub-Adviser, the Adviser retains complete authority immediately to
assume direct responsibility for any function delegated to the Sub-Adviser under
this Agreement.  Subject to the foregoing,  the Sub-Adviser will provide options
investment  research  and conduct a  continuous  program of options  evaluation,
investment,  sales,  and  reinvestment  of the Trust's assets by determining the
options  strategy that the Trust shall pursue,  including which options shall be
purchased,  entered into, sold,  closed,  or exchanged for the Trust, when these
transactions  should be  executed,  and what  portion of the assets of the Trust
shall have options written  against.  The Sub-Adviser  will provide the services
under this  Agreement in  accordance  with the Trust's  investment  objective or
objectives,  policies,  and  restrictions as stated in the Trust's  Registration
Statement filed with the Securities and Exchange  Commission ("SEC"), as amended
(the "Registration Statement"), copies of which shall be sent to the Sub-Adviser
by the  Adviser  prior  to the  commencement  of  this  Agreement  and  promptly
following any such amendment.  The Adviser and the Sub-Adviser  further agree as
follows:

     a. Each of the Adviser and the  Sub-Adviser  will conform with the 1940 Act
     and all rules and regulations thereunder,  all other applicable federal and
     state laws and regulations,  with any applicable  procedures adopted by the
<PAGE>
     Trust's  Board of which  the  Sub-Adviser  has  been  sent a copy,  and the
     provisions of the  Registration  Statement,  of which the  Sub-Adviser  has
     received  a copy and with the  Sub-Adviser's  portfolio  manager  operating
     policies and procedures as are approved by the Adviser. Each of the Adviser
     and the  Sub-Adviser  shall exercise  reasonable care in the performance of
     its duties under the Agreement.

     b. In  connection  with any purchase and sale of  securities  for the Trust
     related to the  implementation  of the options  strategy  developed  by the
     Sub-Adviser,  the  Sub-Adviser  will  arrange for the  transmission  to the
     custodian  for  the  Trust  (the   "Custodian")   on  a  daily  basis  such
     confirmation,   trade  tickets,   and  other  documents  and   information,
     including, but not limited to, Cusip, Cedel, or other numbers that identify
     options  to be  purchased  or  sold  on  behalf  of  the  Trust,  as may be
     reasonably  necessary to enable the Custodian to perform its administrative
     and recordkeeping  responsibilities with respect to the Trust. With respect
     to options to be settled  through the Trust's  Custodian,  the  Sub-Adviser
     will  arrange  for the  prompt  transmission  of the  confirmation  of such
     options trades to the Trust's Custodian.

     c. The Sub-Adviser  will assist the Custodian in determining or confirming,
     consistent  with the  procedures  and policies  stated in the  Registration
     Statement or adopted by the Board, the value of any options or other assets
     of the Trust for which the  Sub-Adviser  is  responsible  and for which the
     Custodian   seeks   assistance   from  or  identifies  for  review  by  the
     Sub-Adviser;  provided  that  the  Sub-Adviser  shall  be  responsible  for
     determining  in good faith,  consistent  with the  procedures  and policies
     stated in the  Registration  Statement  or adopted  by the Board,  the fair
     value of the  Trust's  portfolio  of options for which the  Sub-Adviser  is
     responsible  and shall obtain at its own expense  pricing  services for the
     Trust's portfolio of options from Interactive Data ("IDS"),  Bloomberg,  or
     another pricing service to be mutually agreed. The parties acknowledge that
     the  Sub-Adviser is not a custodian of the Trust's assets and will not take
     possession or custody of such assets.

     d. Following the end of the Trust's semi-annual period and fiscal year, the
     Sub-Adviser  will assist the Adviser in preparing a letter to  shareholders
     containing a discussion of relevant  investment  factors in respect of both
     the prior quarter and the fiscal year to date.

     e. The  Sub-Adviser  will  complete  and  deliver to the  Adviser  for each
     quarter  by the  5th  business  day  of the  following  quarter  a  written
     compliance  checklist  in a form  provided by the  Adviser  relating to the
     performances of the Sub-Adviser under this Agreement.

     f. The  Sub-Adviser  will make  available  to the  Trust  and the  Adviser,
     promptly upon request,  any of the Trust's  investment  records and ledgers
     maintained  by the  Sub-Adviser  (which  shall not  include the records and
     ledgers  maintained by the Custodian or portfolio  accounting agent for the
     Trust) as are  necessary to assist the Trust and the Adviser to comply with
     requirements  of the 1940 Act and the  Investment  Advisers Act of 1940, as
     amended (the  "Advisers  Act"),  and the rules under each, as well as other
     applicable  laws. The  Sub-Adviser  will furnish to regulatory  authorities
     having the  requisite  authority any  information  or reports in connection
     with such  services in respect to the Trust which may be  requested by such
     authorities  in order to ascertain  whether the operations of the Trust are
     being   conducted  in  a  manner   consistent   with  applicable  laws  and
     regulations.

     g. The Sub-Adviser  will provide reports to the Board for  consideration at
     meetings of the Board on the options portion of the investment  program for
     the Trust and the options purchased and sold for the Trust's portfolio, and
     will furnish the Board with such periodic and special  reports as the Board
     and the Adviser may reasonably request.

                                       2
<PAGE>
     h. The Adviser  shall assure that the Trust  complies  with its  investment
     policies  and  restrictions  as set  forth in the  Registration  Statement,
     except for  policies  and  restrictions  concerning  implementation  of the
     Trust's options strategy, and the Adviser acknowledges that the Sub-Adviser
     shall not be  responsible  for the Trust's  compliance  with its investment
     policies and restrictions other than those concerning implementation of the
     Trust's option strategy.

     i. The Adviser  acknowledges  that the Sub-Adviser shall not be responsible
     for   meeting  or   monitoring   compliance   with  the  income  and  asset
     diversification  requirements of Section 851 of the Internal  Revenue Code,
     and the Adviser acknowledges that the Adviser is responsible for the same.

     3. BROKER-DEALER SELECTION. The Sub-Adviser is authorized to make decisions
to buy and sell options for the Trust's portfolio,  and to select broker-dealers
and to negotiate brokerage  commission rates in effecting an option transaction.
The Sub-Adviser's  primary consideration in effecting an option transaction will
be to obtain the best  execution for the Trust,  taking into account the factors
specified in the prospectus  and/or statement of additional  information for the
Trust,  and  determined in  consultation  with the Adviser,  which include price
(including the applicable  brokerage  commission or dollar spread),  the size of
the  order,  the  nature  of the  market  for  the  option,  the  timing  of the
transaction,   the  reputation,   experience  and  financial  stability  of  the
broker-dealer involved, the quality of the service, the difficulty of execution,
and the execution  capabilities and operational facilities of the firm involved,
and the firm's risk in positioning a block of options. Accordingly, the price to
the Trust in any  transaction  may be less  favorable  than that  available from
another broker-dealer if the difference is reasonably justified, in the judgment
of the Sub-Adviser in the exercise of its fiduciary obligations to the Trust, by
other aspects of the portfolio execution services offered. The Sub-Adviser shall
not receive any research service from any  broker-dealer or from any third party
that is paid by such  broker-dealer  in return for placing  trades  through such
broker-dealer  on behalf of the Trust.  The  Sub-Adviser  will  consult with the
Adviser  to  ensure  that  portfolio  transactions  on  behalf  of the Trust are
directed  to  broker-dealers  on the  basis of  criteria  reasonably  considered
appropriate by the Adviser.  To the extent consistent with these standards,  the
Sub-Adviser is further  authorized to allocate the orders placed by it on behalf
of the Trust to an affiliated  broker-dealer.  Such allocation  shall be in such
amounts and proportions as the Sub-Adviser  shall determine  consistent with the
above standards, and the Sub-Adviser will report on said allocation regularly to
the Trust's Board indicating the  broker-dealers  to which such allocations have
been made and the basis therefore.

     4.  DISCLOSURE  ABOUT  SUB-ADVISER.  The  Sub-Adviser has reviewed the most
recent Amendment to the Registration  Statement for the Trust filed with the SEC
(the  "Registration  Statement") that contain  disclosure about the Sub-Adviser,
and represents and warrants that, with respect only to the disclosure  expressly
concerning  the  Sub-Adviser,  its  business,  operations,  or  employees,  such
Registration  Statement contains,  as of the date hereof, no untrue statement of
any material  fact and do not omit any  statement  of a material  fact which was
required to be stated  therein or  necessary  to make the  statements  contained
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.  The Sub-Adviser  further  represents and warrants that it is a duly
registered  investment  adviser  under the Advisers Act and will  maintain  such
registration  so long as this  Agreement  remains in effect.  The Adviser hereby
acknowledges that it has received a copy of the Sub-Adviser's  Form ADV, Part II
at least 48 hours prior to entering into this Agreement.

     5. EXPENSES.  During the term of this Agreement,  the Sub-Adviser  will pay
all expenses incurred by it and its staff and for their activities in connection
with its duties under this Agreement  including,  but not limited to, rental and
overhead expenses, expenses of the Sub-Adviser's personnel,  pricing services in
accordance  with Section 2,  insurance  of the  Sub-Adviser  and its  personnel,
research services, and taxes of the Sub-Adviser.  The Adviser or the Trust shall
be  responsible  for  all  other  expenses  of  the  Trust's  or  the  Adviser's
operations,  including  without  limitation  costs of marketing or  distributing

                                       3
<PAGE>
shares of the Trust,  brokerage  expenses and  commissions,  custody and banking
expenses, administration expenses, legal, audit and other professional expenses,
governmental filing fees, and costs of communications with shareholders.

     6.  COMPENSATION.  For the services provided to the Trust, the Adviser will
pay the  Sub-Adviser  an annual fee equal to the amount  specified in Schedule A
hereto,  payable monthly in arrears on the last business day of each month.  The
fee will be  appropriately  prorated to reflect any portion of a calendar  month
that this  Agreement is not in effect  among the parties.  The Adviser is solely
responsible  for the  payment of fees to the  Sub-Adviser,  and the  Sub-Adviser
agrees to seek payment of its fees solely from the Adviser. The Trust shall have
no liability for Sub-Adviser's fee hereunder.

     7.  MATERIALS.  During the term of this  Agreement,  the Adviser  agrees to
furnish  the  Sub-Adviser  at  its  principal  office  all  prospectuses,  proxy
statements,   and  reports  to   shareholders   prepared  for   distribution  to
shareholders of the Trust, all sales literature or advertisements for the Trust,
and all other  communications  with the public of the Trust, or the Adviser that
refer to the  Sub-Adviser in any way, prior to the use thereof,  and the Adviser
shall  not use any such  materials  if the  Sub-Adviser  reasonably  objects  in
writing within 2 business days (or such other period as may be mutually  agreed)
after receipt thereof.  The  Sub-Adviser's  right to object to such materials is
limited to reasonable  objections related to the portions of such materials that
expressly relate to the Sub-Adviser,  its services and its clients.  The Adviser
agrees to use its reasonable  best efforts to ensure that materials  prepared by
its employees or agents or its affiliates  that refer to the  Sub-Adviser or its
clients in any way are consistent  with those materials  previously  approved by
the Sub-Adviser as referenced in the first sentence of this paragraph.

     8. COMPLIANCE.

     a. As required by Rule 206(4)-2 under the Advisers Act, the Sub-Adviser has
     adopted  written  policies and  procedures  reasonably  designed to prevent
     violation by it, or any of its supervised  persons, of the Advisers Act and
     the  rules  under  the  Advisers  Act and all  other  laws and  regulations
     relevant  to the  performance  of its  duties  under  this  Agreement.  The
     Sub-Adviser  has  designated a chief  compliance  officer  responsible  for
     administering   these  compliance   policies  and  procedures.   The  chief
     compliance officer at the Sub-Adviser's  expense shall provide such written
     compliance reports relating to the operations and compliance  procedures of
     the Sub-Adviser to the Adviser and/or the Trust and their  respective chief
     compliance  officers  as may be  required  by law or  regulation  or as are
     otherwise  reasonably  requested.  Moreover,  the Sub-Adviser agrees to use
     such other or additional  compliance techniques as the Adviser or the Board
     may reasonably adopt or approve, including written compliance procedures.

     b.  The  Sub-Adviser  agrees  that it shall  promptly  notify,  if  legally
     permitted,  the  Adviser  and the Trust  (1) in the event  that the SEC has
     censured the Sub-Adviser; placed limitations upon its activities, functions
     or  operations;  suspended  or revoked its  registration  as an  investment
     adviser; commenced proceedings or an investigation (formally or informally)
     that  may  result  in  any of  these  actions;  or  corresponded  with  the
     Sub-Adviser  on a non-routine  basis  concerning  either the  Sub-Adviser's
     performances under this Agreement or any other matter that might materially
     affect the  ability of the  Sub-Adviser  to perform  its duties  under this
     Agreement,  including  sending a deficiency  letter or raising issues about
     the business, operations, or practices of the Sub-Adviser, (2) in the event
     of any notice of investigation,  examination, inquiry, audit or subpoena of
     the Sub-Adviser or any of its officers or employees by any federal,  state,
     municipal or other  governmental  department,  commission,  bureau,  board,
     agency or  instrumentality.  If legally  permitted,  the  Sub-Adviser  will
     furnish the Adviser, upon request, copies of any and all documents relating
     to the foregoing.  The Sub-Adviser further agrees to notify the Adviser and
     the Trust promptly of any material fact known to the Sub-Adviser respecting
     or relating to the  Sub-Adviser  that is not contained in the  Registration

                                       4
<PAGE>
     Statement or  prospectus  for the Trust,  or any  amendment  or  supplement
     thereto that is required to be so contained,  or if any statement contained
     therein  concerning  the  Sub-Adviser  that becomes  untrue in any material
     respect.

     c. The Adviser agrees that it shall promptly notify, if legally  permitted,
     the  Sub-Adviser  (1) in the event that the SEC has censured the Adviser or
     the Trust;  placed limitations upon either of their activities,  functions,
     or  operations;  suspended  or revoked  the  Adviser's  registration  as an
     investment adviser; suspended or revoked the Trust's registration under the
     1940 Act,  issued any stop order  concerning  any  offering  of the Trust's
     securities,  or has  commenced  proceedings  or an  investigation  that may
     result in any of these  actions,  or  corresponded  with the Adviser or the
     Trust on a non-routine basis concerning the management or operations of the
     Trust or the  advisory  services  provided by the Adviser to the Trust that
     would have a material  adverse impact on the Sub-Adviser or (2) upon having
     a reasonable  basis for  believing  that the Trust has ceased to qualify or
     might not qualify as a regulated  investment  company under Subchapter M of
     the Internal Revenue Code. If legally  permitted,  the Adviser will furnish
     the Sub-Adviser,  upon request, copies of any and all documents relating to
     the foregoing.

     d.  The   Sub-Adviser   will  provide  the  Adviser   with  such   reports,
     presentations,  certifications  and other  information  as the  Adviser may
     reasonably request from time to time concerning the business and operations
     of the Sub-Adviser in performing services hereunder or generally concerning
     the  Sub-Adviser's   investment   advisory   services,   the  Sub-Adviser's
     compliance with applicable  federal,  state and local law and  regulations,
     and changes in the  Sub-Adviser's  key  personnel,  investment  strategies,
     policies  and  procedures,  and  other  matters  that are  likely to have a
     material impact on the Sub-Advisers  duties hereunder.  The Adviser and the
     Trust shall provide the  Sub-Adviser  with such reports as the  Sub-Adviser
     may from time to time reasonably  request  concerning their compliance with
     applicable federal, state and local law and regulations.

     9. BOOKS AND RECORDS.  The Sub-Adviser hereby agrees that all records which
it maintains  for the Trust are the property of the Trust and further  agrees to
surrender  promptly  to the Trust any of such  records  upon the  Trust's or the
Adviser's  request in compliance  with the  requirements of Rule 31a-3 under the
1940 Act,  although the Sub-Adviser  may, at its own expense,  make and retain a
copy of such records. The Sub-Adviser further agrees to preserve for the periods
prescribed  by Rule  31a-2  under  the  1940  Act  the  records  required  to be
maintained by Rule 31a-l under the 1940 Act.

     10.  COOPERATION;  CONFIDENTIALITY;  PROPRIETARY RIGHTS. Each party to this
Agreement  agrees to  cooperate  with the other  party and with all  appropriate
governmental authorities having the requisite jurisdiction  (including,  but not
limited to, the SEC) in connection with any investigation or inquiry relating to
this Agreement or the Trust.  Subject to the foregoing,  the  Sub-Adviser  shall
treat as  confidential  and use only in connection  with the Trust in accordance
with this  Agreement all  information  pertaining  to the Trust,  actions of the
Trust or the Adviser,  and the Adviser shall treat as confidential  and use only
in connection  with the Trust in accordance  with this Agreement all information
furnished  to the Trust or the Adviser by the  Sub-Adviser  (and all  derivative
works produced  therefrom),  in connection  with its duties under this Agreement
except that the aforesaid  information  need not be treated as  confidential  if
required to be disclosed  under  applicable  law, if generally  available to the
public  through  means  that do not  involve  a breach  of this  section  by the
Sub-Adviser  or the  Adviser,  or if  available  from a  source  other  than the
Adviser,  Sub-Adviser or the Trust.  The parties  acknowledge that any breach of
the undertaking in the immediately preceding sentence might result in immediate,
irreparable injury to another party and that,  accordingly,  equitable remedies,
including  ex parte  remedies,  are  appropriate  in the  event  of any  actual,
apparent, or threatened breach of such undertaking.

     The  Adviser  acknowledges  that the  Sub-Adviser  is the sole owner of the
names "Rampart Investment  Management" and "ROMS", and all related names, marks,
and trade dress (the "Rampart Marks") and all associated  goodwill.  The Adviser
shall not take any action inconsistent with such ownership,  including,  without

                                       5
<PAGE>
limitation, contesting the Sub-Adviser's ownership of or validity of the Rampart
Marks. The Adviser agrees that all use of the Rampart Marks under this Agreement
inures to the benefit of the Sub-Adviser.  Apart from the license granted in the
next  paragraph,  the Adviser shall  acquire no right,  title or interest of any
kind or nature  whatsoever  in the  Rampart  Marks and the  goodwill  associated
therewith by virtue of this  Agreement.  The Adviser shall upon request  execute
and deliver such documents as the Sub-Adviser may reasonably  require to further
evidence,  assure,  and  confirm  the rights of the  Sub-Adviser  in the Rampart
Marks.

     The Sub-Adviser  hereby grants to the Adviser and the Trust a non-exclusive
worldwide license to use, publish, reproduce, modify, and distribute the Rampart
Marks solely in connection  with the conduct of the business of the Trust and in
accordance with this Agreement (the "License").  The Adviser and the Trust shall
not use,  publish,  reproduce,  modify or  distribute  any Rampart Marks for any
other  purpose.  The  Adviser and the Trust  shall  comply  with the  reasonable
written instructions of the Sub-Adviser  concerning the use of the Rampart Marks
under the  License,  including  instructions  concerning  trademark  notices and
updates of the Rampart Marks.  The  Sub-Adviser  shall have the right to monitor
and observe the Adviser's  and the Trust's use of the Rampart Marks  pursuant to
the License for the purpose of protecting and  maintaining  its control over the
nature and quality of the Rampart  Marks,  and the  Adviser  shall upon  request
supply Rampart with a written accounting of such use.

     The  Adviser  acknowledges  that the  Sub-Adviser  is the sole owner of the
Rampart  Options  Management  System  ("ROMS").  The Adviser  shall not take any
action  inconsistent  with  such  ownership,   including,   without  limitation,
contesting  the  Sub-Adviser's  ownership of ROMS.  The Adviser shall acquire no
right,  title or  interest of any kind or nature  whatsoever  in ROMS under this
Agreement.  This section  does not prohibit the Advisor,  for the Trust or other
clients,  or the Trust from either (1) contesting what constitutes part of ROMS;
(2) from  using any  systems,  methods or  processes  for  selecting  or trading
options that are not  proprietary to the  Sub-Adviser;  or (3)without the use of
any proprietary processes, methods, or systems of the Sub-Adviser,  managing the
options  strategy  of the Trust  where a portion of the stocks in the  portfolio
have options written on them with the intention of generating income.

     11. CONTROL.  Notwithstanding  any other provision of the Agreement,  it is
understood  and agreed  that the Trust  shall at all times  retain the  ultimate
responsibility  for and  control of all  functions  performed  pursuant  to this
Agreement and has reserved the right to reasonably  direct any action  hereunder
taken on its behalf by the Sub-Adviser.

     12. LIABILITY.

     a.  Except  as may  otherwise  be  required  by the 1940  Act or the  rules
     thereunder  or  other   applicable   law,  the  Adviser   agrees  that  the
     Sub-Adviser,  any affiliated person of the Sub-Adviser, and each person, if
     any, who,  within the meaning of Section 15 of the  Securities Act of 1933,
     as amended (the "1933 Act"),  controls the Sub-Adviser  shall not be liable
     for, or subject to, any damages,  expenses,  or losses in connection  with,
     any act or omission  connected with or arising out of any services rendered
     under this Agreement,  except by reason of willful misfeasance,  bad faith,
     or gross negligence in the performance of the Sub-Adviser's  duties, or any
     breach  by  the  Sub-Adviser  of  its  obligations  or  duties  under  this
     Agreement.

     b.  Except  as may  otherwise  be  required  by the 1940  Act or the  rules
     thereunder  or  other  applicable  law,  the  Sub-Adviser  agrees  that the
     Adviser,  any affiliated  person of the Adviser,  and each person,  if any,
     who, within the meaning of Section 15 of the 1933 Act, controls the Adviser
     shall not be liable for, or subject to, any damages, expenses, or losses in
     connection  with, any act or omission  connected with or arising out of any
     services  rendered  under  this  Agreement,  except by  reason  of  willful

                                        6
<PAGE>
     misfeasance,  bad faith,  or gross  negligence  in the  performance  of the
     Adviser's duties, or any breach by the Adviser of its obligations or duties
     under this Agreement.

     13. INDEMNIFICATION.

     a. The Adviser agrees to indemnify and hold harmless the  Sub-Adviser,  any
     affiliated person of the Sub-Adviser,  and each person, if any, who, within
     the meaning of Section 15 of the 1933 Act controls  ("controlling  person")
     the  Sub-Adviser  (all of such persons  being  referred to as  "Sub-Adviser
     Indemnified  Persons")  against  any  and  all  losses,  claims,   damages,
     liabilities,  or litigation (including legal and other expenses) to which a
     Sub-Adviser  Indemnified  Person may become subject under the 1933 Act, the
     1940 Act,  the  Advisers  Act,  under any other  statute,  at common law or
     otherwise, arising out of the Adviser's responsibilities to the Sub-Adviser
     which  (1) may be  based  upon  the  Adviser's  gross  negligence,  willful
     misfeasance, or bad faith in the performance of its duties, or by reason of
     the Adviser's  disregard of its obligations and duties under this Agreement
     and to the Trust, or (2) may be based upon any untrue  statement or alleged
     untrue statement of a material fact contained in the Registration Statement
     or prospectus covering shares of the Trust, or any amendment thereof or any
     supplement  thereto, or the omission or alleged omission to state therein a
     material  fact  required  to be stated  therein  or  necessary  to make the
     statements  therein not  misleading,  unless such statement or omission was
     made in reliance  upon and  conformity  with  information  furnished by the
     Sub-Adviser  to the Adviser or the Trust  expressly  for  inclusion in such
     Registration Statements, prospectuses, amendments, or supplements either in
     writing or orally with a subsequent  confirmation by the Sub-Adviser of the
     information  as it appears in the  Registration  Statement  or  prospectus;
     provided  however,  that in no case  shall  the  indemnity  in favor of the
     Sub-Adviser Indemnified Person be deemed to protect such person against any
     liability  to which such  person  would  otherwise  be subject by reason of
     willful  misfeasance,  bad faith, or gross negligence in the performance of
     its  duties,  or by  reason  of its  breach or  reckless  disregard  of its
     obligations or duties under this Agreement.

     b. Notwithstanding Section 12 of this Agreement,  the Sub-Adviser agrees to
     indemnify  and hold  harmless the  Adviser,  any  affiliated  person of the
     Adviser,  and any  controlling  person of the Adviser  (all of such persons
     being  referred to as "Adviser  Indemnified  Persons")  against any and all
     losses, claims,  damages,  liabilities,  or litigation (including legal and
     other expenses) to which an Adviser  Indemnified  Person may become subject
     under the 1933 Act, 1940 Act, the Advisers Act, under any other statute, at
     common law or otherwise, arising out of the Sub-Adviser's  responsibilities
     as Sub-Adviser  of the Trust which (1) may be based upon the  Sub-Adviser's
     gross negligence,  willful misfeasance,  or bad faith in the performance of
     its duties, or by reason of the Sub-Adviser's  disregard of its obligations
     or  duties  under  this  Agreement,  or (2) may be based  upon  any  untrue
     statement or alleged  untrue  statement of a material fact contained in the
     Registration  Statement or prospectus  covering the shares of the Trust, or
     any amendment or supplement thereto, or the omission or alleged omission to
     state  therein a material fact known or which should have been known to the
     Sub-Adviser  and was required to be stated therein or necessary to make the
     statements therein not misleading, if such a statement or omission was made
     in  reliance  upon  and  conformity  with  information   furnished  by  the
     Sub-Adviser  to the Adviser or the Trust  expressly  for  inclusion in such
     Registration Statements, prospectuses, amendments, or supplements either in
     writing or orally with a subsequent  confirmation by the Sub-Adviser of the
     information  as it appears in the  Registration  Statement  or  prospectus;
     provided,  however,  that in no case  shall  the  indemnity  in favor of an
     Adviser  Indemnified  Person be deemed to protect  such person  against any
     liability  to which such  person  would  otherwise  be subject by reason of
     willful misfeasance,  bad faith, gross negligence in the performance of its
     duties, or by reason of its breach or reckless disregard of its obligations
     and duties under this Agreement.

                                       7
<PAGE>
     c. The Adviser  shall not be liable under  Paragraph (a) of this Section 13
     with respect to any claim made  against a  Sub-Adviser  Indemnified  Person
     unless such Sub-Adviser  Indemnified Person shall have notified the Adviser
     in writing within a reasonable  time after the summons or other first legal
     process  giving  information  of the  nature of the claim  shall  have been
     served upon such Sub-Adviser  Indemnified Person (or after such Sub-Adviser
     Indemnified  Person  shall  have  received  notice of such  service  on any
     designated  agent),  but  failure to notify  the  Adviser of any such claim
     shall not relieve the Adviser from any  liability  which it may have to the
     Sub-Adviser  Indemnified  Person against whom such action is brought except
     to the extent the Adviser is  prejudiced  by the failure or delay in giving
     such  notice.  In case any such action is brought  against the  Sub-Adviser
     Indemnified Person, the Adviser will be entitled to participate, at its own
     expense,  in the  defense  thereof  or,  after  notice  to the  Sub-Adviser
     Indemnified   Person,   to  assume  the  defense   thereof,   with  counsel
     satisfactory to the Sub-Adviser  Indemnified Person. If the Adviser assumes
     the defense of any such action and the  selection of counsel by the Adviser
     to  represent  the Adviser and the  Sub-Adviser  Indemnified  Person  would
     result  in a  conflict  of  interests  and  therefore,  would  not,  in the
     reasonable  judgment  of the  Sub-Adviser  Indemnified  Person,  adequately
     represent the interests of the Sub-Adviser  Indemnified Person, the Adviser
     will,  at its own  expense,  assume the defense with counsel to the Adviser
     and,  also at its own expense,  with  separate  counsel to the  Sub-Adviser
     Indemnified Person,  which counsel shall be satisfactory to the Adviser and
     to the Sub-Adviser  Indemnified Person. The Sub-Adviser  Indemnified Person
     shall bear the fees and expenses of any additional  counsel retained by it,
     and the Adviser shall not be liable to the Sub-Adviser  Indemnified  Person
     under this Agreement for any legal or other expenses  subsequently incurred
     by the Sub-Adviser  Indemnified Person independently in connection with the
     defense  thereof other than  reasonable  costs of  investigation;  provided
     however,  the Adviser shall be responsible  for the  additional  counsel of
     Sub-Adviser  in the  event  the  Adviser  is  determined  to have  made the
     fraudulent  representations,  by the final decision of a court of competent
     jurisdiction  (that is not  subject  to  appeal or as to which the time for
     appeal  has  elapsed),  and such  representations  are the  basis for which
     Sub-Adviser's  liability is based.  The Adviser shall not have the right to
     compromise on or settle the litigation without the prior written consent of
     the Sub-Adviser Indemnified Person if the compromise or settlement results,
     or may result in a finding  of  wrongdoing  on the part of the  Sub-Adviser
     Indemnified Person.

     d. The Sub-Adviser  shall not be liable under Paragraph (b) of this Section
     13 with  respect to any claim made  against an Adviser  Indemnified  Person
     unless such Adviser  Indemnified Person shall have notified the Sub-Adviser
     in writing within a reasonable  time after the summons or other first legal
     process  giving  information  of the  nature of the claim  shall  have been
     served  upon  such  Adviser  Indemnified  Person  (or  after  such  Adviser
     Indemnified  Person  shall  have  received  notice of such  service  on any
     designated  agent), but failure to notify the Sub-Adviser of any such claim
     shall not relieve the  Sub-Adviser  from any liability which it may have to
     the Adviser  Indemnified  Person against whom such action is brought except
     to the extent the  Sub-Adviser  is  prejudiced  by the  failure or delay in
     giving such notice.  In case any such action is brought against the Adviser
     Indemnified Person, the Sub-Adviser will be entitled to participate, at its
     own  expense,  in the  defense  thereof  or,  after  notice to the  Adviser
     Indemnified   Person,   to  assume  the  defense   thereof,   with  counsel
     satisfactory to the Adviser  Indemnified Person. If the Sub-Adviser assumes
     the  defense  of any  such  action  and the  selection  of  counsel  by the
     Sub-Adviser to represent both the Sub-Adviser  and the Adviser  Indemnified
     Person would result in a conflict of interests and therefore, would not, in
     the  reasonable  judgment of the  Adviser  Indemnified  Person,  adequately
     represent the interests of the Adviser  Indemnified Person, the Sub-Adviser
     will,  at  its  own  expense,  assume  the  defense  with  counsel  to  the
     Sub-Adviser  and,  also at its own expense,  with  separate  counsel to the
     Adviser  Indemnified  Person,  which counsel shall be  satisfactory  to the
     Sub-Adviser and to the Adviser  Indemnified Person. The Adviser Indemnified
     Person shall bear the fees and expenses of any additional  counsel retained
     by it, and the Sub-Adviser  shall not be liable to the Adviser  Indemnified
     Person under this  Agreement for any legal or other  expenses  subsequently
     incurred by the Adviser Indemnified Person independently in connection with
     the defense  thereof  other than  reasonable  costs of  investigation.  The
     Sub-Adviser  shall  not  have the  right to  compromise  on or  settle  the

                                       8
<PAGE>
     litigation  without the prior  written  consent of the Adviser  Indemnified
     Person if the compromise or settlement  results, or may result in a finding
     of wrongdoing on the part of the Adviser Indemnified Person.

     14. DURATION AND TERMINATION.

     a. This Agreement shall become effective on the date first indicated above,
     subject to the condition  that the Trust's  Board,  including a majority of
     those Trustees who are not  interested  persons (as such term is defined in
     the  1940  Act) of the  Adviser  or the  Sub-Adviser,  and the  Holders  of
     Interests in the Trust,  shall have approved  this  Agreement in the manner
     required  by the 1940 Act.  Unless  terminated  as  provided  herein,  this
     Agreement  shall  remain in full force and  effect  through  and  including
     September 24, 2006 and shall continue in full force and affect indefinitely
     thereafter,  but only so long as such continuance is specifically  approved
     at least  annually  by (a) the Board,  or by the vote of a majority  of the
     outstanding  voting  securities  (as defined in the 1940 Act) of the Trust,
     and (b) the vote of a majority  of those  Trustees  who are not  interested
     persons (as such term is defined in the 1940 Act) of any such party to this
     Agreement  cast in person at a meeting  called for the purpose of voting on
     such approval.

     b. Notwithstanding the foregoing, this Agreement may be terminated:  (a) by
     the Adviser at any time without payment of any penalty, upon 60 days' prior
     written notice to the  Sub-Adviser  and the Trust;  (b) at any time without
     payment of any penalty by the Trust,  by the Trust's Board or a majority of
     the outstanding voting securities of the Trust, upon 60 days' prior written
     notice to the Adviser and the Sub-Adviser, or (c) by the Sub-Adviser upon 3
     months'  prior  written  notice  unless the Trust or the  Adviser  requests
     additional  time to find a replacement for the  Sub-Adviser,  in which case
     the  Sub-Adviser  shall allow the additional time requested by the Trust or
     Adviser not to exceed 3 additional  months  beyond the initial  three-month
     notice period;  provided,  however, that the Sub-Adviser may terminate this
     Agreement at any time without penalty, effective upon written notice to the
     Adviser and the Trust, in the event either the Sub-Adviser  (acting in good
     faith) or the Adviser  ceases to be  registered  as an  investment  adviser
     under the Advisers Act or otherwise  becomes legally incapable of providing
     investment management services pursuant to its respective contract with the
     Trust.

     c. In the event of  termination  for any  reason,  all records of the Trust
     shall promptly be returned to the Adviser or the Trust, free from any claim
     or  retention  of rights in such record by the  Sub-Adviser,  although  the
     Sub-Adviser  may,  at its  own  expense,  make  and  retain  a copy of such
     records.  This Agreement shall automatically  terminate in the event of its
     assignment  (as such term is described in the 1940 Act).  In the event this
     Agreement is terminated or is not approved in the manner  described  above,
     the Sections or Paragraphs numbered 9, 10, 11, 12, and 13 of this Agreement
     shall remain in effect, as well as any applicable provision of this Section
     14 and, to the extent  that only  amounts  are owed to the  Sub-Adviser  as
     compensation  for  services  rendered  while the  agreement  was in effect,
     Section 6.

     15. NOTICES.  Any notice must be in writing and shall be sufficiently given
(1)  when  delivered  in  person,  (2) when  dispatched  by  electronic  mail or
electronic  facsimile  transfer  (confirmed in writing by postage  prepaid first
class air mail  simultaneously  dispatched),  (3) when  sent by  internationally
recognized  overnight  courier service (with receipt confirmed by such overnight
courier service), or (4) when sent by registered or certified mail, to the other
party at the address of such party set forth  below or at such other  address as
such party may from time to time specify in writing to the other party.

                                       9
<PAGE>
                  If to the Trust:

                  Eaton Vance Enhanced Equity Income Fund II
                  The Eaton Vance Building
                  255 State Street
                  Boston, Massachusetts 02109
                  Attn: Chief Legal Officer

                  If to the Adviser:

                  Eaton Vance Management
                  The Eaton Vance Building
                  255 State Street
                  Boston, Massachusetts 02109
                  Attn: Chief Legal Officer

                  If to the Sub-Adviser:

                  Rampart Investment Management, Inc.
                  One International Place, 14th Floor
                  Boston, Massachusetts 02110
                  Attn:  Ronald M. Egalka

     16.  AMENDMENTS.  No provision of this  Agreement  may be changed,  waived,
discharged or terminated  orally, but only by an instrument in writing signed by
the  party  against  which  enforcement  of the  change,  waiver,  discharge  or
termination  is sought,  and no amendment of this  Agreement  shall be effective
until approved as required by applicable law.

     17. MISCELLANEOUS.

     a. This  Agreement  shall be  governed by the laws of the  Commonwealth  of
     Massachusetts,  provided that nothing herein shall be construed in a manner
     inconsistent  with the 1940 Act, the Advisers Act or rules or orders of the
     SEC  thereunder,  and without  regard for the conflicts of laws  principles
     thereof.  The  term  "affiliate"  or  "affiliated  person"  as used in this
     Agreement shall mean  "affiliated  person" as defined in Section 2(a)(3) of
     the 1940 Act.

     b. The Adviser and the  Sub-Adviser  acknowledge  that the Trust enjoys the
     rights of a third-party  beneficiary under this Agreement,  and the Adviser
     acknowledges  that the  Sub-Adviser  enjoys  the  rights  of a third  party
     beneficiary under the Advisory Agreement.

     c. The Sub-Adviser expressly  acknowledges the provision in the Declaration
     of Trust of the Adviser limiting the personal  liability of the Trustee and
     officers of the Adviser,  and the  Sub-Adviser  hereby agrees that it shall
     have  recourse  to the  Adviser  for  payment of claims or  obligations  as
     between the Adviser and the  Sub-Adviser  arising out of this Agreement and
     shall not seek satisfaction from the Trustee or any officer of the Adviser.

     d. The captions of this Agreement are included for convenience  only and in
     no way define or limit any of the  provisions  hereof or  otherwise  affect
     their construction or effect.

                                       10
<PAGE>
     e.  To the  extent  permitted  under  Section  14 of this  Agreement,  this
     Agreement may only be assigned by any party with the prior written  consent
     of the other party. This Agreement shall terminate upon its assignment, and
     for purposes of this section the term  "assignment"  shall have the meaning
     assigned to it in the 1940 Act.

     f. If any  provision of this  Agreement  shall be held or made invalid by a
     court decision, statute, rule or otherwise, the remainder of this Agreement
     shall not be affected thereby,  and to this extent,  the provisions of this
     Agreement shall be deemed to be severable.

     g. Nothing herein shall be construed as constituting  the Sub-Adviser as an
     agent or co-partner of the Adviser, or constituting the Adviser as an agent
     or co-partner of the Sub-Adviser.

     h. This Agreement may be executed in counterparts.

     i. The Sub-Adviser  shall not be responsible for any failure to perform its
     duties under this Agreement as a result of war, acts of terrorism,  natural
     disasters,  failures of  electricity,  telephone  lines,  and other utility
     services,  closures of  securities  and options  markets,  and other events
     beyond the reasonable  control of the Sub-Adviser  provided the Sub-Adviser
     has maintained contingency procedures reasonably designed,  where possible,
     to prevent and mitigate the effect of such events.

                            [Signature page follows.]






                                       11
<PAGE>
     IN WITNESS  WHEREOF,  the parties hereto have caused this  instrument to be
executed as of the day and year first above written.

                                Eaton Vance Management


                                By:
                                        ----------------------------------------
                                Name:   Alan R. Dynner
                                        Vice President, and not individually



                                 RAMPART INVESTMENT MANAGEMENT COMPANY, INC.


                                 By:
                                         --------------------------------------
                                 Name:   Ronald M. Egalka
                                 Title:  President







                                       12
<PAGE>
                                   SCHEDULE A

                       Annual Investment Sub-Advisory Fee
                        0.235% of Assets under Management


The  Trust's  daily  net  assets  shall  be  computed  in  accordance  with  the
Declaration of Trust of the Trust and any applicable votes and determinations of
the Board of the Trust.









                                       13

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(H)(1)
<SEQUENCE>6
<FILENAME>b52674a1exv99wxhyx1y.txt
<DESCRIPTION>EX-99.(H)(1) FORM OF UNDERWRITING AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (H)(1)

                   Eaton Vance Enhanced Equity Income Fund II



                    [ ] Common Shares of Beneficial Interest

                            Par Value $0.01 Per Share

                                      FORM

                                       OF

                             UNDERWRITING AGREEMENT

<PAGE>

January [ ], 2005


                                       2
<PAGE>


                             UNDERWRITING AGREEMENT

                                                   January [ ], 2005
UBS Securities LLC
[Co-Managers]

   as Representatives

c/o UBS Securities LLC
299 Park Avenue
New York, New York  10171-0026

Ladies and Gentlemen:

      Eaton Vance Enhanced Equity Income Fund II, a voluntary association with
transferable shares organized and existing under and by virtue of the laws of
The Commonwealth of Massachusetts (commonly referred to as a Massachusetts
business trust) (the "Fund"), proposes to issue and sell to the underwriters
named in Schedule A annexed hereto (the "Underwriters") an aggregate of [ ]
common shares of beneficial interest (the "Firm Shares"), par value $0.01 per
share (the "Common Shares"), of the Fund. In addition, solely for the purpose of
covering over-allotments, the Fund proposes to grant to the Underwriters the
option to purchase from the Fund up to an additional [ ] Common Shares (the
"Additional Shares"). The Firm Shares and the Additional Shares are hereinafter
collectively sometimes referred to as the "Shares." The Shares are described in
the Prospectus which is defined below.

            The Fund has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively called the "Securities Act"), and with the provisions of the
Investment Company Act of 1940, as amended, and the rules and regulations
thereunder (collectively called the "Investment Company Act"), with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form N-2 (File Nos. 333-120421 and 811-21670), including a prospectus and a
statement of additional information, relating to the Shares. The Fund has
furnished to the Representatives, for use by the Underwriters and by dealers,
copies of one or more preliminary prospectuses (including a preliminary
statement of additional information) (each thereof, including such preliminary
statement of additional information, being herein called a "Preliminary
Prospectus") relating to the Shares. Except where the context otherwise
requires, the registration statement, as amended when it becomes effective (the
"Effective Date"), including all documents filed as a part thereof or
incorporated by reference therein, and including any information contained in a
prospectus subsequently filed with the Commission pursuant to Rule 497


                                       3
<PAGE>

under the Securities Act and deemed to be part of the registration statement at
the time of effectiveness pursuant to Rule 430A under the Securities Act is
herein called the "Registration Statement," and the prospectus (including the
statement of additional information), in the form filed by the Fund with the
Commission pursuant to Rule 497 under the Securities Act or, if no such filing
is required, the form of final prospectus (including the form of final statement
of additional information) included in the Registration Statement at the time it
became effective, is herein called the "Prospectus." In addition, the Fund has
filed a Notification of Registration on Form N-8A (the "Notification") pursuant
to Section 8 of the Investment Company Act. UBS Securities LLC ("UBS Securities"
or the "Managing Representative") will act as managing representative for the
Underwriters.

Eaton Vance Management, a Massachusetts business trust ("Eaton Vance" or the
"Investment Adviser") will act as the Fund's investment adviser pursuant to an
Investment Advisory Agreement by and between the Fund and the Investment
Adviser, dated as of [ ], 2005 (the "Investment Advisory Agreement"). Rampart
Investment Management Company, Inc. (the "Sub-Adviser" and together with the
Investment Adviser the "Advisers") will act as the Fund's investment sub-adviser
pursuant to an Investment Sub-Advisory Agreement among the Fund, the Investment
Adviser and the Sub-Adviser, dated as of [ ], 2005 (the "Sub-Advisory
Agreement"). Investors Bank & Trust Company will act as the custodian (the
"Custodian") of the Fund's cash and portfolio assets pursuant to a Custodian
Agreement, dated as of [ ], 2005 (the "Custodian Agreement"). PFPC Inc. will act
as the Fund's transfer agent, registrar, and dividend disbursing agent (the
"Transfer Agent") pursuant to a Transfer Agency Services Agreement, dated as of
[ ], 2005 (the "Transfer Agency Agreement"). Eaton Vance will act as the
administrator of the Fund pursuant to an Administration Agreement, dated as of [
], 2005 (the "Administration Agreement"). The Investment Adviser and UBS
Securities LLC have entered into a Shareholder Servicing Agreement dated [ ],
2005 (the "Shareholder Servicing Agreement"). The Investment Adviser has also
entered into an Additional Compensation Agreement with [ ] and [ ], dated [ ],
2005 (the "Additional Compensation Agreement"). In addition, the Fund has
adopted a dividend reinvestment plan (the "Dividend Reinvestment Plan") pursuant
to which holders of Shares may have their dividends automatically reinvested in
additional Common Shares of the Fund if so elected.

            The Fund, the Investment Adviser, the Sub-Adviser and the
Underwriters agree as follows:

1.    SALE AND PURCHASE. Upon the basis of the warranties and representations
      and subject to the terms and conditions herein set forth, the Fund agrees
      to sell to the respective Underwriters and each of the Underwriters,
      severally and not jointly, agrees to purchase from the Fund the aggregate
      number of Firm Shares set forth opposite the name of such Underwriter in
      Schedule A attached hereto in each case at a purchase price of $19.10 per
      Share. The Fund is advised that the Underwriters intend (i) to make a
      public offering of their respective portions of the Firm Shares as soon
      after the effective date of the Registration Statement as is advisable and
      (ii) initially to offer the Firm Shares upon the terms set forth in the
      Prospectus. The Underwriters may from time to time increase or decrease
      the public offering price after the initial public offering to such extent
      as they may determine.


                                       4
<PAGE>

            In addition, the Fund hereby grants to the several Underwriters the
      option to purchase, and upon the basis of the warranties and
      representations and subject to the terms and conditions herein set forth,
      the Underwriters shall have the right to purchase, severally and not
      jointly, from the Fund, ratably in accordance with the number of Firm
      Shares to be purchased by each of them, all or a portion of the Additional
      Shares as may be necessary to cover over-allotments made in connection
      with the offering of the Firm Shares, at the same purchase price per Share
      to be paid by the Underwriters to the Fund for the Firm Shares. This
      option may be exercised by the Representatives on behalf of the several
      Underwriters at any time and from time to time on or before the
      forty-fifth day following the date hereof, by written notice to the Fund.
      Such notice shall set forth the aggregate number of Additional Shares as
      to which the option is being exercised, and the date and time when the
      Additional Shares are to be delivered (such date and time being herein
      referred to as the "Additional Time of Purchase"); provided, however, that
      the Additional Time of Purchase shall not be earlier than the Time of
      Purchase (as defined below) nor earlier than the second business day after
      the date on which the option shall have been exercised. The number of
      Additional Shares to be sold to each Underwriter shall be the number which
      bears the same proportion to the aggregate number of Additional Shares
      being purchased as the number of Firm Shares set forth opposite the name
      of such Underwriter on Schedule A hereto bears to the total number of Firm
      Shares (subject, in each case, to such adjustment as the Representatives
      may determine to eliminate fractional shares).

2.    PAYMENT AND DELIVERY. Payment of the purchase price for the Firm Shares
      shall be made by the Underwriters to the Fund by Federal Funds wire
      transfer, against delivery of the certificates for the Firm Shares to the
      Representatives through the facilities of the Depository Trust Company for
      the respective accounts of the Underwriters. Such payment and delivery
      shall be made at a time mutually agreed upon by the parties on the third
      business day following the date of this Underwriting Agreement (unless
      another date shall be agreed to by the Representatives and the Fund). The
      time at which such payment and delivery are actually made is hereinafter
      sometimes called the Time of Purchase. Certificates for the Firm Shares
      shall be delivered to the Representatives in definitive form in such names
      and in such denominations as the Representatives shall specify on the
      second business day preceding the Time of Purchase. For the purpose of
      expediting the checking of the certificates for the Firm Shares by the
      Representatives, the Fund agrees to make such certificates available to
      the Representatives for such purpose at least one full business day
      preceding the Time of Purchase.

            Payment of the purchase price for the Additional Shares shall be
      made at the Additional Time of Purchase in the same manner and at the same
      office as the payment for the Firm Shares. Certificates for the Additional
      Shares shall be delivered to the Representatives in definitive form in
      such names and in such denominations as the Representatives shall specify
      no later than the second business day preceding the Additional Time of
      Purchase. For the purpose of


                                       5
<PAGE>

      expediting the checking of the certificates for the Additional Shares by
      the Representatives, the Fund agrees to make such certificates available
      to the Representatives for such purpose at least one full business day
      preceding the Additional Time of Purchase. The Time of Purchase and the
      Additional Time of Purchase are sometimes referred to herein as the
      Closing Dates.

3.    REPRESENTATIONS AND WARRANTIES OF THE FUND, THE INVESTMENT ADVISER AND THE
      SUB-ADVISER. Each of the Fund, the Investment Adviser and the Sub-Adviser
      jointly and severally represents and warrants to each Underwriter as
      follows:

      (a)   On (i) the Effective Date and the date on which the Prospectus is
            first filed with the Commission pursuant to Rule 497(b), (h) or (j)
            under the Securities Act, as the case may be, (ii) the date on which
            any post-effective amendment to the Registration Statement (except
            any post-effective amendment which is filed with the Commission
            after the later of (x) one year from the date of this Underwriting
            Agreement or (y) the date on which the distribution of the Shares is
            completed) became or becomes effective or any amendment or
            supplement to the Prospectus was or is filed with the Commission and
            (iii) the Closing Dates, the Registration Statement, the Prospectus
            and any such amendment or supplement thereto and the Notification
            complied or will comply in all material respects with the
            requirements of the Securities Act and the Investment Company Act,
            as the case may be. On the Effective Date and on the date that any
            post-effective amendment to the Registration Statement (except any
            post-effective amendment which is filed with the Commission after
            the later of (x) one year from the date of this Underwriting
            Agreement or (y) the date on which the distribution of the Shares is
            completed) became or becomes effective, neither the Registration
            Statement nor any such amendment did or will contain any untrue
            statement of a material fact or omit to state a material fact
            required to be stated in it or necessary to make the statements in
            it not misleading. Except as permitted under Rule 430 under the
            Securities Act (and other applicable rules under Regulation C under
            the Securities Act), the Preliminary Prospectus dated December [ ],
            2004 did not, as of such date, contain any untrue statement of a
            material fact or omit to state a material fact required to be stated
            in it or necessary to make the statements in it, in light of the
            circumstances under which they were made, not misleading. At the
            Effective Date and, if applicable, the date the Prospectus or any
            amendment or supplement to the Prospectus was or is filed with the
            Commission and at the Closing Dates, the Prospectus did not or will
            not, as the case may be, contain any untrue statement of a material
            fact or omit to state a material fact required to be stated in it or
            necessary to make the statements in it, in light of the
            circumstances under which they were made, not misleading. The
            foregoing representations in this Section 3(a) do not apply to
            statements or omissions relating to the Underwriters made in
            reliance on and in conformity with information furnished in writing
            to the Fund by the Underwriters expressly for use in


                                       6
<PAGE>

            the Registration Statement, the Prospectus, or any amendments or
            supplements thereto, as described in Section 9(f) hereof.

      (b)   The Fund has been duly formed, is validly existing a business trust
            under the laws of the Commonwealth of Massachusetts, with full power
            and authority to conduct all the activities conducted by it, to own
            or lease all assets owned or leased by it and to conduct its
            business as described in the Registration Statement and Prospectus,
            and the Fund is duly licensed and qualified to do business and in
            good standing in each jurisdiction in which its ownership or leasing
            of property or its conducting of business requires such
            qualification, except where the failure to be so qualified or be in
            good standing would not have a material adverse effect on the Fund,
            and the Fund owns, possesses or has obtained and currently maintains
            all governmental licenses, permits, consents, orders, approvals and
            other authorizations, whether foreign or domestic, necessary to
            carry on its business as contemplated in the Prospectus. The Fund
            has no subsidiaries.

      (c)   The capitalization of the Fund is as set forth in the Registration
            Statement and the Prospectus. The Common Shares conform in all
            material respects to the description of them in the Prospectus. All
            the outstanding Common Shares have been duly authorized and are
            validly issued, fully paid and nonassessable (except as described in
            the Registration Statement). The Shares to be issued and delivered
            to and paid for by the Underwriters in accordance with this
            Underwriting Agreement against payment therefor as provided by this
            Underwriting Agreement have been duly authorized and when issued and
            delivered to the Underwriters will have been validly issued and will
            be fully paid and nonassessable (except as described in the
            Registration Statement). No person is entitled to any preemptive or
            other similar rights with respect to the Shares.

      (d)   The Fund is duly registered with the Commission under the Investment
            Company Act as a diversified, closed-end management investment
            company, and, subject to the filing of any final amendment to the
            Registration Statement (a "Final Amendment"), if not already filed,
            all action under the Securities Act and the Investment Company Act,
            as the case may be, necessary to make the public offering and
            consummate the sale of the Shares as provided in this Underwriting
            Agreement has or will have been taken by the Fund.

      (e)   The Fund has full power and authority to enter into each of this
            Underwriting Agreement, the Investment Advisory Agreement, the
            Sub-Advisory Agreement, the Custodian Agreement, the Transfer Agency
            Agreement, the Administration Agreement, and the Dividend
            Reinvestment Plan (collectively, the "Fund Agreements") and to
            perform all of the terms and provisions hereof and thereof to be
            carried out by it and (i) each Fund Agreement has been duly and
            validly authorized, executed and delivered by or on behalf of the
            Fund, (ii) each Fund


                                       7
<PAGE>

            Agreement does not violate in any material respect any of the
            applicable provisions of the Investment Company Act or the
            Investment Advisers Act of 1940, as amended, and the rules and
            regulations thereunder (collectively called the "Advisers Act"), as
            the case may be, and (iii) assuming due authorization, execution and
            delivery by the other parties thereto, each Fund Agreement
            constitutes the legal, valid and binding obligation of the Fund
            enforceable in accordance with its terms, (A) subject, as to
            enforcement, to applicable bankruptcy, insolvency and similar laws
            affecting creditors' rights generally and to general equitable
            principles (regardless of whether enforcement is sought in a
            proceeding in equity or at law) and (B) except as rights to
            indemnity thereunder may be limited by federal or state securities
            laws.

      (f)   None of (i) the execution and delivery by the Fund of the Fund
            Agreements, (ii) the issue and sale by the Fund of the Shares as
            contemplated by this Underwriting Agreement and (iii) the
            performance by the Fund of its obligations under any of the Fund
            Agreements or consummation by the Fund of the other transactions
            contemplated by the Fund Agreements conflicts with or will conflict
            with, or results or will result in a breach of, the Declaration of
            Trust or the By-laws of the Fund or any agreement or instrument to
            which the Fund is a party or by which the Fund is bound, or any law,
            rule or regulation, or order of any court, governmental
            instrumentality, securities exchange or association or arbitrator,
            whether foreign or domestic, applicable to the Fund, other than
            state securities or "blue sky" laws applicable in connection with
            the purchase and distribution of the Shares by the Underwriters
            pursuant to this Underwriting Agreement.

      (g)   The Fund is not currently in breach of, or in default under, any
            written agreement or instrument to which it is a party or by which
            it or its property is bound or affected.

      (h)   No person has any right to the registration of any securities of the
            Fund because of the filing of the registration statement.

      (i)   No consent, approval, authorization or order of any court or
            governmental agency or body or securities exchange or association,
            whether foreign or domestic, is required by the Fund for the
            consummation by the Fund of the transactions to be performed by the
            Fund or the performance by the Fund of all the terms and provisions
            to be performed by or on behalf of it in each case as contemplated
            in the Fund Agreements, except such as (i) have been obtained under
            the Securities Act, the Investment Company Act, or the Advisers Act,
            and (ii) may be required by the New York Stock Exchange or under
            state securities or "blue sky" laws, in connection with the purchase
            and distribution of the Shares by the Underwriters pursuant to this
            Underwriting Agreement.


                                                                               8
<PAGE>

      (j)   The Shares are duly authorized for listing, subject to official
            notice of issuance, on the New York Stock Exchange and the Fund's
            Registration Statement on Form 8-A, under the Securities Exchange
            Act of 1934, as amended, and the rules and regulations thereunder
            (collectively called the "Exchange Act"), has become effective.

      (k)   Deloitte & Touche LLP, whose report appears in the Prospectus, are
            independent public auditors with respect to the Fund as required by
            the Securities Act and the Investment Company Act.

      (l)   The statement of assets and liabilities included in the Registration
            Statement and the Prospectus presents fairly in all material
            respects, in accordance with generally accepted accounting
            principles in the United States applied on a consistent basis, the
            financial position of the Fund as of the date indicated.

      (m)   The Fund will maintain a system of internal accounting controls
            sufficient to provide reasonable assurances that (i) transactions
            are executed in accordance with management's general or specific
            authorization; (ii) transactions are recorded as necessary to permit
            preparation of financial statements in conformity with generally
            accepted accounting principles and to maintain accountability for
            assets; (iii) access to assets is permitted only in accordance with
            management's general or specific authorization; and (iv) the
            recorded accountability for assets is compared with existing assets
            through an asset reconciliation procedure or otherwise at reasonable
            intervals and appropriate action is taken with respect to any
            differences.

      (n)   Since the date as of which information is given in the Registration
            Statement and the Prospectus, except as otherwise stated therein,
            (i) there has been no material adverse change in the condition,
            financial or otherwise, business affairs or business of the Fund,
            whether or not arising in the ordinary course of business, (ii)
            there have been no transactions entered into by the Fund other than
            those in the ordinary course of its business and (iii) there has
            been no dividend or distribution of any kind declared, paid or made
            on any class of its capital shares.

      (o)   There is no action, suit or proceeding before or by any court,
            commission, regulatory body, administrative agency or other
            governmental agency or body, foreign or domestic, now pending, or,
            to the knowledge of the Fund, threatened against or affecting the
            Fund, which (i) might result in any material adverse change in the
            condition, financial or otherwise, business affairs or business
            prospects of the Fund or might materially adversely affect the
            properties or assets of the Fund or (ii) is of a character required
            to be described in the Registration Statement or the Prospectus; and
            there are no contracts, franchises or other documents that are of a
            character required to be described in, or that are required to be
            filed as exhibits to,


                                       9
<PAGE>

            the Registration Statement that have not been described or filed as
            required.

      (p)   Except for stabilization transactions conducted by the Underwriters,
            and except for tender offers, Share repurchases and the issuance or
            purchase of Shares pursuant to the Fund's Dividend Reinvestment Plan
            effected following the date on which the distribution of the Shares
            is completed in accordance with the policies of the Fund as set
            forth in the Prospectus, the Fund has not taken and will not take,
            directly or indirectly, any action designed or which might be
            reasonably expected to cause or result in, or which will constitute,
            stabilization or manipulation of the price of the Common Shares in
            violation of applicable federal securities laws.

      (q)   The Fund intends to direct the investment of the proceeds of the
            offering of the Shares in such a manner as to comply with the
            requirements of Subchapter M of the Internal Revenue Code of 1986,
            as amended (the "Code").

      (r)   To the knowledge of the Fund after due inquiry, no advertising,
            sales literature or other promotional materials (excluding road show
            slides or road show tapes) were authorized or prepared by or on
            behalf of the Fund, the Investment Adviser or the Sub-Adviser or any
            representative thereof for use in connection with the public
            offering or sale of the Shares other than the definitive client
            brochure and the broker selling memo which were filed with the NASD
            on December [ ], 2004, a draft prospecting letter which was filed
            with the NASD on December [ ], 2004, a draft of a prospecting letter
            made available on a password-protected Internet web site maintained
            by the Investment Adviser and a road show tape made available for
            broker use on an Intranet web site maintained by the Investment
            Adviser (collectively, the "sales materials"); the sales materials
            and any road show slides or road show tapes complied and comply in
            all material respects with the applicable requirements of the
            Securities Act and the rules and interpretations of the NASD; and no
            broker kits, road show slides, road show tapes or sales materials
            authorized or prepared by the Fund or authorized or prepared on
            behalf of the Fund by the Investment Adviser or the Sub-Adviser or
            any representative thereof for use in connection with the public
            offering or sale of the Shares contained or contains any untrue
            statement of a material fact or omitted or omits to state any
            material fact required to be stated therein or necessary in order to
            make the statements therein not misleading.

            In addition, any certificate signed by any officer of the Fund and
      delivered to the Underwriters or counsel for the Underwriters in
      connection with the offering of the Share shall be deemed to be a
      representation and warranty by the Fund as to matters covered thereby, to
      each Underwriter


                                       10
<PAGE>

4.    REPRESENTATIONS AND WARRANTIES OF THE INVESTMENT ADVISER AND THE
      SUB-ADVISER. Each of the Investment Adviser and the Sub-Adviser represents
      to each Underwriter as follows:

      (a)   Such Adviser has been duly formed, is validly existing as a business
            trust under the laws of the Commonwealth of Massachusetts, in the
            case of the Investment Adviser, or as a corporation under the laws
            of the Commonwealth of Massachusetts, in the case of the
            Sub-Adviser, with full power and authority to conduct all of the
            activities conducted by it, to own or lease all of the assets owned
            or leased by it and to conduct its business as described in the
            Registration Statement and Prospectus, and such Adviser is duly
            licensed and qualified to do business and in good standing in each
            jurisdiction in which it is required to be so qualified, except to
            the extent that failure to be so qualified or be in good standing
            would not have a material adverse affect on the such Adviser's
            ability to provide services to the Fund; and such Adviser owns,
            possesses or has obtained and currently maintains all governmental
            licenses, permits, consents, orders, approvals and other
            authorizations, whether foreign or domestic, necessary to carry on
            its business as contemplated in the Registration Statement and the
            Prospectus.

      (b)   Such Adviser is (i) duly registered as an investment adviser under
            the Advisers Act and (ii) not prohibited by the Advisers Act or the
            Investment Company Act from acting as the investment adviser for the
            Fund as contemplated by the Investment Advisory Agreement, the
            Sub-Advisory Agreement, the Registration Statement and the
            Prospectus.

      (c)   Such Adviser has full power and authority to enter into each of this
            Underwriting Agreement, the Investment Advisory Agreement, the
            Sub-Advisory Agreement, the Administration Agreement, the
            Shareholder Servicing Agreement, and the Additional Compensation
            Agreement, to which such Adviser is a party (collectively, the
            "Adviser Agreements"), and to carry out all the terms and provisions
            hereof and thereof to be carried out by it; and each Adviser
            Agreement has been duly and validly authorized, executed and
            delivered by such Adviser; none of the Adviser Agreements violate in
            any material respect any of the applicable provisions of the
            Investment Company Act or the Advisers Act; and assuming due
            authorization, execution and delivery by the other parties thereto,
            each Adviser Agreement constitutes a legal, valid and binding
            obligation of such Adviser, enforceable in accordance with its
            terms, (i) subject, as to enforcement, to applicable bankruptcy,
            insolvency and similar laws affecting creditors' rights generally
            and to general equitable principles (regardless of whether
            enforcement is sought in a proceeding in equity or at law) and (ii)
            except as rights to indemnity thereunder may be limited by federal
            or state securities laws.


                                       11
<PAGE>

      (d)   Neither (i) the execution and delivery by such Adviser of any
            Adviser Agreement nor (ii) the consummation by such Adviser of the
            transactions contemplated by, or the performance of its obligations
            under any Adviser Agreement conflicts or will conflict with, or
            results or will result in a breach of, the Declaration of Trust, in
            the case of the Investment Adviser, or Articles of Incorporation, in
            the case of the Sub-Adviser, or By-Laws of such Adviser or any
            agreement or instrument to which such Adviser is a party or by which
            such Adviser is bound, or any law, rule or regulation, or order of
            any court, governmental instrumentality, securities exchange or
            association or arbitrator, whether foreign or domestic, applicable
            to such Adviser.

      (e)   No consent, approval, authorization or order of any court,
            governmental agency or body or securities exchange or association,
            whether foreign or domestic, is required for the consummation of the
            transactions contemplated in, or the performance by such Adviser of
            its obligations under, any Adviser Agreement, as the case may be,
            except such as (i) have been obtained under the Securities Act, the
            Investment Company Act, or the Advisers Act, and (ii) may be
            required by the New York Stock Exchange or under state securities or
            "blue sky" laws, in connection with the purchase and distribution of
            the Shares by the Underwriters pursuant to this Underwriting
            Agreement.

      (f)   The description of such Adviser and its business and the statements
            attributable to such Adviser in the Registration Statement and the
            Prospectus comply with the requirements of the Securities Act and
            the Investment Company Act and do not contain any untrue statement
            of a material fact or omit to state any material fact required to be
            stated therein or necessary in order to make the statements therein
            not misleading.

      (g)   Except as disclosed, there is no action, suit or proceeding before
            or by any court, commission, regulatory body, administrative agency
            or other governmental agency or body, foreign or domestic, now
            pending or, to the knowledge of such Adviser, threatened against or
            affecting such Adviser of a nature required to be disclosed in the
            Registration Statement or Prospectus or that might reasonably be
            expected to result in any material adverse change in the condition,
            financial or otherwise, business affairs or business prospects of
            such Adviser or the ability of such Adviser to fulfill its
            respective obligations under any Adviser Agreement.

      (h)   Except for stabilization activities conducted by the Underwriters
            and except for tender offers, Share repurchases and the issuance or
            purchase of Shares pursuant to the Fund's Dividend Reinvestment Plan
            effected following the date on which the distribution of the Shares
            is completed in accordance with the policies of the Fund as set
            forth in the Prospectus, such Adviser has not taken and will not
            take, directly or indirectly, any action designed, or which might
            reasonably be expected to cause or result


                                       12
<PAGE>

            in, or which will constitute, stabilization or manipulation of the
            price of the Common Shares in violation of applicable federal
            securities laws.

            In the event that the Fund or such Adviser makes available any
            promotional materials (other than the sales materials) intended for
            use only by qualified broker-dealers and registered representatives
            thereof by means of an Internet web site or similar electronic
            means, such Adviser will install and maintain pre-qualification and
            password-protection or similar procedures which will effectively
            prohibit access to such promotional materials by persons other than
            qualified broker-dealers and registered representatives thereof.

            In addition, any certificate signed by any officer of the Investment
      Adviser or the Sub-Adviser and delivered to the Underwriters or counsel
      for the Underwriters in connection with the offering of the Shares shall
      be deemed to be a representation and warranty by the Investment Adviser or
      the Sub-Adviser, as applicable, as to matters covered thereby, to each
      Underwriter.

5.    AGREEMENTS OF THE PARTIES.

      (a)   If the registration statement relating to the Shares has not yet
            become effective, the Fund will promptly file a Final Amendment, if
            not previously filed, with the Commission, and will use its best
            efforts to cause such registration statement to become effective
            and, as soon as the Fund is advised, will advise the Managing
            Representative when the Registration Statement or any amendment
            thereto has become effective. If the Registration Statement has
            become effective and the Prospectus contained therein omits certain
            information at the time of effectiveness pursuant to Rule 430A under
            the Securities Act, the Fund will file a 430A Prospectus pursuant to
            Rule 497(h) under the Securities Act as promptly as practicable, but
            no later than the second business day following the earlier of the
            date of the determination of the offering price of the Shares or the
            date the Prospectus is first used after the Effective Date. If the
            Registration Statement has become effective and the Prospectus
            contained therein does not so omit such information, the Fund will
            file a Prospectus pursuant to Rule 497(b) or a certification
            pursuant to Rule 497(j) under the Securities Act as promptly as
            practicable, but no later than the fifth business day following the
            date of the later of the Effective Date or the commencement of the
            public offering of the Shares after the Effective Date. In either
            case, the Fund will provide the Managing Representative satisfactory
            evidence of the filing. The Fund will not file with the Commission
            any Prospectus or any other amendment (except any post-effective
            amendment which is filed with the Commission after the later of (x)
            one year from the date of this Underwriting Agreement or (y) the
            date on which distribution of the Shares is completed) or supplement
            to the Registration Statement or the Prospectus unless a copy has
            first been submitted to the Managing Representative a reasonable
            time before its


                                       13
<PAGE>

            filing and the Managing Representative has not objected to it in
            writing within a reasonable time after receiving the copy.

      (b)   For the period of three years from the date hereof, the Fund will
            advise the Managing Representative promptly (i) of the issuance by
            the Commission of any order in respect of the Fund, the Investment
            Adviser or the Sub-Adviser, which relates to the Fund, or which
            relates to any material arrangements or proposed material
            arrangements involving the Fund, the Investment Adviser or the
            Sub-Adviser, (ii) of the initiation or threatening of any
            proceedings for, or receipt by the Fund of any notice with respect
            to, any suspension of the qualification of the Shares for sale in
            any jurisdiction or the issuance of any order by the Commission
            suspending the effectiveness of the Registration Statement, (iii) of
            receipt by the Fund, or any representative or attorney of the Fund,
            of any other communication from the Commission relating in any
            material way to the Fund, the Registration Statement, the
            Notification, any Preliminary Prospectus, the Prospectus or to the
            transactions contemplated by this Underwriting Agreement and (iv)
            the issuance by any court, regulatory body, administrative agency or
            other governmental agency or body, whether foreign or domestic, of
            any order, ruling or decree, or the threat to initiate any
            proceedings with respect thereto, regarding the Fund, which relates
            in any material way to the Fund or any material arrangements or
            proposed material arrangements involving the Fund. The Fund will
            make every reasonable effort to prevent the issuance of any order
            suspending the effectiveness of the Registration Statement and, if
            any such order is issued, to obtain its lifting as soon as possible.

      (c)   If not delivered prior to the date of this Underwriting Agreement,
            the Fund will deliver to the Managing Representative, without
            charge, a signed copy of the Registration Statement and the
            Notification and of any amendments (except any post-effective
            amendment which is filed with the Commission after the later of (x)
            one year from the date of this Underwriting Agreement or (y) the
            date on which the distribution of the Shares is completed) to either
            the Registration Statement or the Notification (including all
            exhibits filed with any such document) and as many conformed copies
            of the Registration Statement and any amendments thereto (except any
            post-effective amendment which is filed with the Commission after
            the later of (x) one year from the date of this Underwriting
            Agreement or (y) the date on which the distribution of the Shares is
            completed) (excluding exhibits) as the Managing Representative may
            reasonably request.

      (d)   During such period as a prospectus is required by law to be
            delivered by an underwriter or a dealer, the Fund will deliver,
            without charge, to the Representatives, the Underwriters and any
            dealers, at such office or offices as the Representatives may
            designate, as many copies of the Prospectus as the Representatives
            may reasonably request, and, if any event occurs


                                       14
<PAGE>

            during such period as a result of which it is necessary to amend or
            supplement the Prospectus, in order to make the statements therein,
            in light of the circumstances under which they were made, not
            misleading in any material respect, or if during such period it is
            necessary to amend or supplement the Prospectus to comply with the
            Securities Act or the Investment Company Act, the Fund promptly will
            prepare, submit to the Managing Representative, file with the
            Commission and deliver, without charge, to the Underwriters and to
            dealers (whose names and addresses the Managing Representative will
            furnish to the Fund) to whom Shares may have been sold by the
            Underwriters, and to other dealers on request, amendments or
            supplements to the Prospectus so that the statements in such
            Prospectus, as so amended or supplemented, will not, in light of the
            circumstances under which they were made, be misleading in any
            material respect and will comply with the Securities Act and the
            Investment Company Act. Delivery by the Underwriters of any such
            amendments or supplements to the Prospectus will not constitute a
            waiver of any of the conditions in Section 6 hereof.

      (e)   The Fund will make generally available to holders of the Fund's
            securities, as soon as practicable but in no event later than the
            last day of the 18th full calendar month following the calendar
            quarter in which the Effective Date falls, an earnings statement, if
            applicable, satisfying the provisions of the last paragraph of
            Section 11(a) of the Securities Act and, at the option of the Fund,
            Rule 158 under the Securities Act.

      (f)   If the transactions contemplated by this Underwriting Agreement are
            consummated, the Fund shall pay all costs and expenses incident to
            the performance of the obligations of the Fund under this
            Underwriting Agreement (to the extent such expenses do not, in the
            aggregate, exceed $0.04 per Share), including but not limited to
            costs and expenses of or relating to (i) the preparation, printing
            and filing of the Registration Statement and exhibits to it, each
            Preliminary Prospectus, the Prospectus and all amendments and
            supplements thereto, (ii) the issuance of the Shares and the
            preparation and delivery of certificates for the Shares, (iii) the
            registration or qualification of the Shares for offer and sale under
            the securities or "blue sky" laws of the jurisdictions referred to
            in the foregoing paragraph, including the fees and disbursements of
            counsel for the Underwriters in that connection, and the preparation
            and printing of any preliminary and supplemental "blue sky"
            memoranda, (iv) the furnishing (including costs of design,
            production, shipping and mailing) to the Underwriters and dealers of
            copies of each Preliminary Prospectus relating to the Shares, the
            sales materials, the Prospectus, and all amendments or supplements
            to the Prospectus, and of the other documents required by this
            Section to be so furnished, (v) the filing requirements of the NASD,
            in connection with its review of the financing, including filing
            fees paid by counsel for the Underwriters in that connection, (vi)
            all transfer taxes, if any, with respect to the sale and delivery of
            the Shares to


                                       15
<PAGE>

            the Underwriters, (vii) the listing of the Shares on the New York
            Stock Exchange and (viii) the transfer agent for the Shares. To the
            extent the foregoing costs and expenses incident to the performance
            of the obligations of the Fund under this Underwriting Agreement
            exceed, in the aggregate, $0.04 per Share, Eaton Vance or an
            affiliate will pay all such excess costs and expenses. The Fund, the
            Investment Adviser and the Sub-Adviser may otherwise agree among
            themselves as to the payment of the foregoing expenses, whether or
            not the transactions contemplated by this Underwriting Agreement are
            consummated, provided, however, that in no event shall the
            Underwriters be obligated to pay any of the foregoing expenses.

      (g)   If the transactions contemplated by this Underwriting Agreement are
            not consummated, except as otherwise provided herein, no party will
            be under any liability to any other party, except that (i) if this
            Underwriting Agreement is terminated by (x) the Fund, the Investment
            Adviser or the Sub-Adviser pursuant to any of the provisions hereof
            or (y) by the Representatives or the Underwriters because of any
            inability, failure or refusal on the part of the Fund, the
            Investment Adviser or the Sub-Adviser to comply with any material
            terms or because any of the conditions in Section 6 are not
            satisfied, the Investment Adviser or the Sub-Adviser or such
            Adviser's affiliates and the Fund, jointly and severally, will
            reimburse the Underwriters for all out-of-pocket expenses (including
            the reasonable fees, disbursements and other charges of their
            counsel) reasonably incurred by them in connection with the proposed
            purchase and sale of the Shares and (ii) no Underwriter who has
            failed or refused to purchase the Shares agreed to be purchased by
            it under this Underwriting Agreement, in breach of its obligations
            pursuant to this Underwriting Agreement, will be relieved of
            liability to the Fund, the Investment Adviser, the Sub-Adviser and
            the other Underwriters for damages occasioned by its default.

      (h)   Without the prior written consent of the Managing Representative,
            the Fund will not offer, sell or register with the Commission, or
            announce an offering of, any equity securities of the Fund, within
            180 days after the Effective Date, except for the Shares as
            described in the Prospectus and any issuances of Common Shares
            pursuant to the Dividend Reinvestment Plan and except in connection
            with any offering of preferred shares of beneficial interest as
            contemplated by the Prospectus.

      (i)   The Fund will use its best efforts to list the Shares on the New
            York Stock Exchange prior to the date the Shares are issued and
            comply with the rules and regulations of such exchange.

      (j)   The Fund will direct the investment of the net proceeds of the
            offering of the Shares in such a manner as to comply with the
            investment objective and policies of the Fund as described in the
            Prospectus.


                                       16
<PAGE>

6.    CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
      Underwriters to purchase the Shares are subject to the accuracy on the
      date of this Underwriting Agreement, and on each of the Closing Dates, of
      the representations of the Fund, the Investment Adviser and the
      Sub-Adviser in this Underwriting Agreement, to the accuracy and
      completeness of all material statements made by the Fund, the Investment
      Adviser or the Sub-Adviser or any of their respective officers in any
      certificate delivered to the Managing Representative or its counsel
      pursuant to this Underwriting Agreement, to performance by the Fund, the
      Investment Adviser and the Sub-Adviser of their respective obligations
      under this Underwriting Agreement and to each of the following additional
      conditions:

      (a)   The Registration Statement must have become effective by 5:30 p.m.,
            New York City time, on the date of this Underwriting Agreement or
            such later date and time as the Managing Representative consents to
            in writing. The Prospectus must have been filed in accordance with
            Rule 497(b) or (h) or a certificate must have been filed in
            accordance with Rule 497(j), as the case may be, under the
            Securities Act.

      (b)   No order suspending the effectiveness of the Registration Statement
            may be in effect and no proceedings for such purpose may be pending
            before or, to the knowledge of counsel to the Underwriters,
            threatened by the Commission, and any requests for additional
            information on the part of the Commission (to be included in the
            Registration Statement or the Prospectus or otherwise) must be
            complied with or waived to the reasonable satisfaction of the
            Managing Representative.

      (c)   Since the dates as of which information is given in the Registration
            Statement and the Prospectus, (i) there must not have been any
            material change in the Common Shares or liabilities of the Fund
            except as set forth in or contemplated by the Prospectus; (ii) there
            must not have been any material adverse change in the general
            affairs, prospects, management, business, financial condition or
            results of operations of the Fund, the Investment Adviser or the
            Sub-Adviser whether or not arising from transactions in the ordinary
            course of business as set forth in or contemplated by the Prospectus
            which in the judgment of the Managing Representative would
            materially adversely affect the market for the Shares; (iii) the
            Fund must not have sustained any material loss or interference with
            its business from any court or from legislative or other
            governmental action, order or decree, whether foreign or domestic,
            or from any other occurrence not described in the Registration
            Statement and Prospectus; and (iv) there must not have occurred any
            event that makes untrue or incorrect in any material respect any
            statement or information contained in the Registration Statement or
            Prospectus or that is not reflected in the Registration Statement or
            Prospectus but should be reflected therein in order to make the
            statements or information therein (in the case of the Prospectus, in
            light of the circumstances in which they were made) not misleading
            in any material respect; if, in the judgment of


                                       17
<PAGE>

            the Managing Representative, any such development referred to in
            clause (i), (ii), (iii), or (iv) of this paragraph (c) makes it
            impracticable or inadvisable to consummate the sale and delivery of
            the Shares pursuant to this Underwriting Agreement by the
            Underwriters, at the initial public offering price of the Shares.

      (d)   The Managing Representative must have received on each Closing Date
            a certificate, dated such date, of the President or a Vice-President
            and the chief financial or accounting officer of each of the Fund,
            the Investment Adviser and the Sub-Adviser certifying (in their
            capacity as such officers and, with respect to clauses (ii), (iii)
            and (vi) below, on behalf of the Fund and such Adviser, as the case
            may be) that (i) the signers have carefully examined the
            Registration Statement, the Prospectus, and this Underwriting
            Agreement, (ii) the representations of the Fund (with respect to the
            certificates from such Fund officers), the representations of the
            Investment Adviser (with respect to the certificates from such
            officers of the Investment Adviser) and the representations of the
            Sub-Adviser (with respect to the certificates from such officers of
            the Sub-Adviser) in this Underwriting Agreement are accurate on and
            as of the date of the certificate, (iii) there has not been any
            material adverse change in the general affairs, prospects,
            management, business, financial condition or results of operations
            of the Fund (with respect to the certificates from such Fund
            officers), the Investment Adviser (with respect to the certificates
            from such officers of the Investment Adviser) or the Sub-Adviser
            (with respect to the certificates from such officers of the
            Sub-Adviser), which change would materially and adversely affect the
            ability of the Fund, the Investment Adviser or the Sub-Adviser, as
            the case may be, to fulfill its obligations under this Underwriting
            Agreement, the Investment Advisory Agreement (with respect to the
            certificates from such officers of the Investment Adviser) or the
            Sub-Advisory Agreement, whether or not arising from transactions in
            the ordinary course of business, (iv) with respect to the Fund only,
            to the knowledge of such officers after reasonable investigation, no
            order suspending the effectiveness of the Registration Statement,
            prohibiting the sale of any of the Shares or otherwise having a
            material adverse effect on the Fund has been issued and no
            proceedings for any such purpose are pending before or threatened by
            the Commission or any other regulatory body, whether foreign or
            domestic, (v) to the knowledge of the officers of each of the
            Investment Adviser and the Sub-Adviser, after reasonable
            investigation, no order having a material adverse effect on the
            ability of such Adviser to fulfill its obligations under this
            Underwriting Agreement, the Shareholder Servicing Agreement, the
            Additional Compensation Agreement, the Investment Advisory Agreement
            or the Sub-Advisory Agreement (with respect to the certificates from
            such officers of the Investment Adviser) and this Underwriting
            Agreement or the Sub-Advisory Agreement, (with respect to the
            certificates from such officers of the Sub-Adviser), as the case may
            be, has been issued and no proceedings for any such purpose are
            pending


                                       18
<PAGE>

            before or threatened by the Commission or any other regulatory body,
            whether foreign or domestic, and (vi) each of the Fund (with respect
            to the certificates from such Fund officers), the Investment Adviser
            (with respect to the certificates from such officers of the
            Investment Adviser) and the Sub-Adviser (with respect to the
            certificates from such officers of the Sub-Adviser) has performed
            all of its respective agreements that this Underwriting Agreement
            requires it to perform by such Closing Date (to the extent not
            waived in writing by the Managing Representative). (e) The Managing
            Representative must have received on each Closing Date the opinions
            dated such Closing Date substantially in the form of Schedules B, C,
            and D to this Underwriting Agreement from the counsel identified in
            each such Schedules.

      (f)   The Managing Representative must have received on each Closing Date
            from Skadden, Arps, Slate, Meagher & Flom LLP and its affiliated
            entities an opinion dated such Closing Date with respect to the
            Fund, the Shares, the Registration Statement and the Prospectus,
            this Underwriting Agreement and the form and sufficiency of all
            proceedings taken in connection with the sale and delivery of the
            Shares. Such opinion and proceedings shall fulfill the requirements
            of this Section 6(f) only if such opinion and proceedings are
            satisfactory in all respects to the Managing Representative. The
            Fund, the Investment Adviser and the Sub-Adviser must have furnished
            to such counsel such documents as counsel may reasonably request for
            the purpose of enabling them to render such opinion.

      (g)   The Managing Representative must have received on the date this
            Underwriting Agreement is signed and delivered by you a signed
            letter, dated such date, substantially in the form of Schedule E to
            this Underwriting Agreement from the firm of accountants designated
            in such Schedule. The Managing Representative also must have
            received on each Closing Date a signed letter from such accountants,
            dated as of such Closing Date, confirming on the basis of a review
            in accordance with the procedures set forth in their earlier letter
            that nothing has come to their attention during the period from a
            date not more than five business days before the date of this
            Underwriting Agreement, specified in the letter, to a date not more
            than five business days before such Closing Date, that would require
            any change in their letter referred to in the foregoing sentence.

            All opinions, letters, evidence and certificates mentioned above or
      elsewhere in this Underwriting Agreement will comply only if they are in
      form and scope reasonably satisfactory to counsel for the Underwriters,
      provided that any such documents, forms of which are annexed hereto, shall
      be deemed satisfactory to such counsel if substantially in such form.


                                       19
<PAGE>

7.    TERMINATION. This Underwriting Agreement may be terminated by the Managing
      Representative by notifying the Fund at any time:

      (a)   before the later of the effectiveness of the Registration Statement
            and the time when any of the Shares are first generally offered
            pursuant to this Underwriting Agreement by the Managing
            Representative to dealers by letter or telegram;

      (b)   at or before any Closing Date if, in the sole judgment of the
            Managing Representative, payment for and delivery of any Shares is
            rendered impracticable or inadvisable because (i) trading in the
            equity securities of the Fund is suspended by the Commission or by
            the principal exchange that lists the Shares, (ii) trading in
            securities generally on the New York Stock Exchange, the New York
            Stock Exchange or the Nasdaq Stock Market shall have been suspended
            or limited or minimum or maximum prices shall have been generally
            established on such exchange or over-the-counter market, (iii)
            additional material governmental restrictions, not in force on the
            date of this Underwriting Agreement, have been imposed upon trading
            in securities or trading has been suspended on any U.S. securities
            exchange, (iv) a general banking moratorium has been established by
            U.S. federal or New York authorities or (v) any material adverse
            change in the financial or securities markets in the United States
            or in political, financial or economic conditions in the United
            States or any outbreak or material escalation of hostilities or
            declaration by the United States of a national emergency or war or
            other calamity, terrorist activity or crisis shall have occurred the
            effect of any of which is such as to make it, in the sole judgment
            of the Managing Representative, impracticable or inadvisable to
            market the Shares on the terms and in the manner contemplated by the
            Prospectus; or

      (c)   at or before any Closing Date, if any of the conditions specified in
            Section 6 have not been fulfilled when and as required by this
            Underwriting Agreement.

8.    SUBSTITUTION OF UNDERWRITERS. If one or more of the Underwriters fails
      (other than for a reason sufficient to justify the termination of this
      Underwriting Agreement) to purchase on any Closing Date the Shares agreed
      to be purchased on such Closing Date by such Underwriter or Underwriters,
      the Managing Representative may find one or more substitute underwriters
      to purchase such Shares or make such other arrangements as the Managing
      Representative deems advisable, or one or more of the remaining
      Underwriters may agree to purchase such Shares in such proportions as may
      be approved by the Managing Representative, in each case upon the terms
      set forth in this Underwriting Agreement. If no such arrangements have
      been made within 36 hours after such Closing Date, and


                                       20
<PAGE>

      (a)   the number of Shares to be purchased by the defaulting Underwriters
            on such Closing Date does not exceed 10% of the Shares that the
            Underwriters are obligated to purchase on such Closing Date, each of
            the nondefaulting Underwriters will be obligated to purchase such
            Shares on the terms set forth in this Underwriting Agreement in
            proportion to their respective obligations under this Underwriting
            Agreement, or

      (b)   the number of Shares to be purchased by the defaulting Underwriters
            on such Closing Date exceeds 10% of the Shares to be purchased by
            all the Underwriters on such Closing Date, the Fund will be entitled
            to an additional period of 24 hours within which to find one or more
            substitute underwriters reasonably satisfactory to the Managing
            Representative to purchase such Shares on the terms set forth in
            this Underwriting Agreement.

            Upon the occurrence of the circumstances described in the foregoing
      paragraph (b), either the Managing Representative or the Fund will have
      the right to postpone the applicable Closing Date for not more than five
      business days in order that necessary changes and arrangements (including
      any necessary amendments or supplements to the Registration Statement or
      the Prospectus) may be effected by the Managing Representative and the
      Fund. If the number of Shares to be purchased on such Closing Date by such
      defaulting Underwriter or Underwriters exceeds 10% of the Shares that the
      Underwriters are obligated to purchase on such Closing Date, and none of
      the nondefaulting Underwriters or the Fund makes arrangements pursuant to
      this Section within the period stated for the purchase of the Shares that
      the defaulting Underwriters agreed to purchase, this Underwriting
      Agreement will terminate without liability on the part of any
      nondefaulting Underwriter, the Fund, the Investment Adviser, or the
      Sub-Adviser except as provided in Sections 5(g) and 9 hereof. Any action
      taken under this Section will not affect the liability of any defaulting
      Underwriter to the Fund, the Investment Adviser or the Sub-Adviser or to
      any nondefaulting Underwriters arising out of such default. A substitute
      underwriter will become an Underwriter for all purposes of this
      Underwriting Agreement.

9.    INDEMNITY AND CONTRIBUTION.

      (a)   Each of the Fund, the Investment Adviser and the Sub-Adviser,
            jointly and severally, agrees to indemnify, defend and hold harmless
            each Underwriter, its partners, directors and officers, and any
            person who controls any Underwriter within the meaning of Section 15
            of the Securities Act or Section 20 of the Exchange Act, and their
            successors and assigns of all of the foregoing persons from and
            against any loss, damage, expense, liability or claim (including the
            reasonable cost of investigation) which, jointly or severally, any
            such Underwriter or any such person may incur under the Securities
            Act, the Exchange Act, the Investment


                                       21
<PAGE>

            Company Act, the Advisers Act, the common law or otherwise, insofar
            as such loss, damage, expense, liability or claim arises out of or
            is based upon any untrue statement or alleged untrue statement of a
            material fact contained in the Registration Statement (or in the
            Registration Statement as amended by any post-effective amendment
            thereof by the Fund) or in a Prospectus (the term "Prospectus" for
            the purpose of this Section 9 being deemed to include any
            Preliminary Prospectus, the sales materials, the Prospectus and the
            Prospectus as amended or supplemented by the Fund), or arises out of
            or is based upon any omission or alleged omission to state a
            material fact required to be stated in either such Registration
            Statement or Prospectus or necessary to make the statements made
            therein (with respect to the Prospectus, in light of the
            circumstances under which they were made) not misleading, except
            insofar as any such loss, damage, expense, liability or claim arises
            out of or is based upon any untrue statement or alleged untrue
            statement of a material fact contained in and in conformity with
            information furnished in writing by or on behalf of any Underwriter
            to the Fund, the Investment Adviser or the Sub-Adviser expressly for
            use with reference to any Underwriter in such Registration Statement
            or such Prospectus or arises out of or is based upon any omission or
            alleged omission to state a material fact in connection with such
            information required to be stated in such Registration Statement or
            such Prospectus or necessary to make such information (with respect
            to the Prospectus, in light of the circumstances under which they
            were made) not misleading, provided, however, that the indemnity
            agreement contained in this subsection (a) with respect to any
            Preliminary Prospectus or amended Preliminary Prospectus shall not
            inure to the benefit of any Underwriter (or to the benefit of any
            person controlling such Underwriter) from whom the person asserting
            any such loss, damage, expense, liability or claim purchased the
            Shares which is the subject thereof if the Prospectus corrected any
            such alleged untrue statement or omission and if such Underwriter
            failed to send or give a copy of the Prospectus to such person at or
            prior to the written confirmation of the sale of such Shares to such
            person, unless the failure is the result of noncompliance by the
            Fund with Section 5(d) hereof.

                  If any action, suit or proceeding (together, a "Proceeding")
            is brought against an Underwriter or any such person in respect of
            which indemnity may be sought against the Fund, the Investment
            Adviser or the Sub-Adviser pursuant to the foregoing paragraph, such
            Underwriter or such person shall promptly notify the Fund, the
            Investment Adviser or the Sub-Adviser in writing of the institution
            of such Proceeding and the Fund, the Investment Adviser or the
            Sub-Adviser shall assume the defense of such Proceeding, including
            the employment of counsel reasonably satisfactory to such
            indemnified party and payment of all fees and expenses; provided,
            however, that the omission to so notify the Fund, the Investment
            Adviser or the Sub-Adviser shall not relieve the Fund, the
            Investment Adviser or the Sub-Adviser from any liability which the
            Fund,


                                       22
<PAGE>

            the Investment Adviser or the Sub-Adviser may have to any
            Underwriter or any such person or otherwise. Such Underwriter or
            such person shall have the right to employ its or their own counsel
            in any such case, but the reasonable fees and expenses of such
            counsel shall be at the expense of such Underwriter or of such
            person unless the employment of such counsel shall have been
            authorized in writing by the Fund, the Investment Adviser or the
            Sub-Adviser, as the case may be, in connection with the defense of
            such Proceeding or the Fund, the Investment Adviser or the
            Sub-Adviser shall not have, within a reasonable period of time in
            light of the circumstances, employed counsel to have charge of the
            defense of such Proceeding or such indemnified party or parties
            shall have reasonably concluded that there may be defenses available
            to it or them, which are different from, additional to or in
            conflict with those available to the Fund, the Investment Adviser or
            the Sub-Adviser (in which case the Fund, the Investment Adviser or
            the Sub-Adviser shall not have the right to direct the defense of
            such Proceeding on behalf of the indemnified party or parties), in
            any of which events such reasonable fees and expenses shall be borne
            by the Fund, the Investment Adviser or the Sub-Adviser and paid as
            incurred (it being understood, however, that the Fund, the
            Investment Adviser or the Sub-Adviser shall not be liable for the
            expenses of more than one separate counsel (in addition to any local
            counsel) in any one Proceeding or series of related Proceedings in
            the same jurisdiction representing the indemnified parties who are
            parties to such Proceeding). Neither the Fund, the Investment
            Adviser nor the Sub-Adviser shall be liable for any settlement of
            any Proceeding effected without its written consent but if settled
            with the written consent of the Fund, the Investment Adviser or the
            Sub-Adviser, the Fund, the Investment Adviser or the Sub-Adviser, as
            the case may be, agrees to indemnify and hold harmless any
            Underwriter and any such person from and against any loss or
            liability by reason of such settlement. Notwithstanding the
            foregoing sentence, if at any time an indemnified party shall have
            requested an indemnifying party to reimburse the indemnified party
            for reasonable fees and expenses of counsel as contemplated by the
            second sentence of this paragraph, then the indemnifying party
            agrees that it shall be liable for any settlement of any Proceeding
            effected without its written consent if (i) such settlement is
            entered into more than 60 business days after receipt by such
            indemnifying party of the aforesaid request, (ii) such indemnifying
            party shall not have reimbursed the indemnified party in accordance
            with such request prior to the date of such settlement and (iii)
            such indemnified party shall have given the indemnifying party at
            least 30 days' prior notice of its intention to settle. No
            indemnifying party shall, without the prior written consent of the
            indemnified party, effect any settlement of any pending or
            threatened Proceeding in respect of which any indemnified party is
            or could have been a party and indemnity could have been sought
            hereunder by such indemnified party, unless such settlement includes
            an unconditional release of such indemnified party from all
            liability on claims


                                       23
<PAGE>

            that are the subject matter of such Proceeding and does not include
            an admission of fault, culpability or a failure to act, by or on
            behalf of such indemnified party.

      (b)   Each Underwriter severally agrees to indemnify, defend and hold
            harmless the Fund, the Investment Adviser and the Sub-Adviser, and
            each of their respective shareholders, partners, managers, members,
            trustees, directors and officers, and any person who controls the
            Fund, the Investment Adviser or the Sub-Adviser within the meaning
            of Section 15 of the Securities Act or Section 20 of the Exchange
            Act, and the successors and assigns of all of the foregoing persons
            from and against any loss, damage, expense, liability or claim
            (including the reasonable cost of investigation), which, jointly or
            severally, the Fund, the Investment Adviser or the Sub-Adviser or
            any such person may incur under the Securities Act, the Exchange
            Act, the Investment Company Act, the Advisers Act, the common law or
            otherwise, insofar as such loss, damage, expense, liability or claim
            arises out of or is based upon any untrue statement or alleged
            untrue statement of a material fact contained in and in conformity
            with information furnished in writing by or on behalf of such
            Underwriter to the Fund, the Investment Adviser or the Sub-Adviser
            expressly for use with reference to such Underwriter in the
            Registration Statement (or in the Registration Statement as amended
            by any post-effective amendment thereof by the Fund) or in a
            Prospectus, or arises out of or is based upon any omission or
            alleged omission to state a material fact in connection with such
            information required to be stated in such Registration Statement or
            such Prospectus or necessary to make such information not misleading
            (with respect to the Prospectus, in light of the circumstances under
            which they were made).

                  If any Proceeding is brought against the Fund, the Investment
            Adviser, the Sub-Adviser or any such person in respect of which
            indemnity may be sought against any Underwriter pursuant to the
            foregoing paragraph, the Fund, the Investment Adviser, the
            Sub-Adviser or such person shall promptly notify such Underwriter in
            writing of the institution of such Proceeding and such Underwriter
            shall assume the defense of such Proceeding, including the
            employment of counsel reasonably satisfactory to such indemnified
            party and payment of all fees and expenses; provided, however, that
            the omission to so notify such Underwriter shall not relieve such
            Underwriter from any liability which such Underwriter may have to
            the Fund, the Investment Adviser, the Sub-Adviser or any such person
            or otherwise. The Fund, the Investment Adviser, the Sub-Adviser or
            such person shall have the right to employ its own counsel in any
            such case, but the fees and expenses of such counsel shall be at the
            expense of the Fund, the Investment Adviser, the Sub-Adviser or such
            person, as the case may be, unless the employment of such counsel
            shall have been authorized in writing by such Underwriter in
            connection with the defense of such Proceeding or such Underwriter
            shall


                                       24
<PAGE>

            not have, within a reasonable period of time in light of the
            circumstances, employed counsel to have charge of the defense of
            such Proceeding or such indemnified party or parties shall have
            reasonably concluded that there may be defenses available to it or
            them, which are different from or additional to or in conflict with
            those available to such Underwriter (in which case such Underwriter
            shall not have the right to direct the defense of such Proceeding on
            behalf of the indemnified party or parties, but such Underwriter may
            employ counsel and participate in the defense thereof but the fees
            and expenses of such counsel shall be at the expense of such
            Underwriter), in any of which events such fees and expenses shall be
            borne by such Underwriter and paid as incurred (it being understood,
            however, that such Underwriter shall not be liable for the expenses
            of more than one separate counsel (in addition to any local counsel)
            in any one Proceeding or series of related Proceedings in the same
            jurisdiction representing the indemnified parties who are parties to
            such Proceeding). No Underwriter shall be liable for any settlement
            of any such Proceeding effected without the written consent of such
            Underwriter but if settled with the written consent of such
            Underwriter, such Underwriter agrees to indemnify and hold harmless
            the Fund, the Investment Adviser, the Sub-Adviser and any such
            person from and against any loss or liability by reason of such
            settlement. Notwithstanding the foregoing sentence, if at any time
            an indemnified party shall have requested an indemnifying party to
            reimburse the indemnified party for fees and expenses of counsel as
            contemplated by the second sentence of this paragraph, then the
            indemnifying party agrees that it shall be liable for any settlement
            of any Proceeding effected without its written consent if (i) such
            settlement is entered into more than 60 business days after receipt
            by such indemnifying party of the aforesaid request, (ii) such
            indemnifying party shall not have reimbursed the indemnified party
            in accordance with such request prior to the date of such settlement
            and (iii) such indemnified party shall have given the indemnifying
            party at least 30 days' prior notice of its intention to settle. No
            indemnifying party shall, without the prior written consent of the
            indemnified party, effect any settlement of any pending or
            threatened Proceeding in respect of which any indemnified party is
            or could have been a party and indemnity could have been sought
            hereunder by such indemnified party, unless such settlement includes
            an unconditional release of such indemnified party from all
            liability on claims that are the subject matter of such Proceeding
            and does not include an admission of fault, culpability or a failure
            to act, by or on behalf of such indemnified party.

      (c)   If the indemnification provided for in this Section 9 is unavailable
            to an indemnified party under subsections (a) and (b) of this
            Section 9 in respect of any losses, damages, expenses, liabilities
            or claims referred to therein, then each applicable indemnifying
            party, in lieu of indemnifying such indemnified party, shall
            contribute to the amount paid or payable by such indemnified party
            as a result of such losses, damages, expenses, liabilities


                                       25
<PAGE>

            or claims (i) in such proportion as is appropriate to reflect the
            relative benefits received by the Fund, the Investment Adviser and
            the Sub-Adviser on the one hand and the Underwriters on the other
            hand from the offering of the Shares or (ii) if the allocation
            provided by clause (i) above is not permitted by applicable law, in
            such proportion as is appropriate to reflect not only the relative
            benefits referred to in clause (i) above but also the relative fault
            of the Fund, the Investment Adviser and the Sub-Adviser on the one
            hand and of the Underwriters on the other in connection with the
            statements or omissions, which resulted in such losses, damages,
            expenses, liabilities or claims, as well as any other relevant
            equitable considerations. The relative benefits received by the
            Fund, the Investment Adviser and the Sub-Adviser on the one hand and
            the Underwriters on the other shall be deemed to be in the same
            respective proportions as the total proceeds from the offering (net
            of underwriting discounts and commissions but before deducting
            expenses) received by the Fund and the total underwriting discounts
            and commissions received by the Underwriters, bear to the aggregate
            public offering price of the Shares. The relative fault of the Fund,
            the Investment Adviser and the Sub-Adviser on the one hand and of
            the Underwriters on the other shall be determined by reference to,
            among other things, whether the untrue statement or alleged untrue
            statement of a material fact or omission or alleged omission relates
            to information supplied by the Fund, the Investment Adviser or the
            Sub-Adviser or by the Underwriters and the parties' relative intent,
            knowledge, access to information and opportunity to correct or
            prevent such statement or omission. The amount paid or payable by a
            party as a result of the losses, damages, expenses, liabilities and
            claims referred to in this subsection shall be deemed to include any
            legal or other fees or expenses reasonably incurred by such party in
            connection with investigating, preparing to defend or defending any
            Proceeding.

      (d)   The Fund, the Investment Adviser, the Sub-Adviser and the
            Underwriters agree that it would not be just and equitable if
            contribution pursuant to this Section 9 were determined by pro rata
            allocation (even if the Underwriters were treated as one entity for
            such purpose) or by any other method of allocation that does not
            take account of the equitable considerations referred to in
            subsection (c) above. Notwithstanding the provisions of this Section
            9, no Underwriter shall be required to contribute any amount in
            excess of the fees and commissions received by such Underwriter. No
            person guilty of fraudulent misrepresentation (within the meaning of
            Section 11(f) of the Securities Act) shall be entitled to
            contribution from any person who was not guilty of such fraudulent
            misrepresentation. The Underwriters' obligations to contribute
            pursuant to this Section 9 are several in proportion to their
            respective underwriting commitments and not joint.


                                       26
<PAGE>

      (e)   The indemnity and contribution agreements contained in this Section
            9 and the covenants, warranties and representations of the Fund
            contained in this Agreement shall remain in full force and effect
            regardless of any investigation made by or on behalf of any
            Underwriter, its partners, directors or officers or any person
            (including each partner, officer or director of such person) who
            controls any Underwriter within the meaning of Section 15 of the
            Securities Act or Section 20 of the Exchange Act, or by or on behalf
            of the Fund, the Investment Adviser or the Sub-Adviser, its
            shareholders, partners, advisers, members, trustees, directors or
            officers or any person who controls the Fund, the Investment Adviser
            or the Sub-Adviser within the meaning of Section 15 of the
            Securities Act or Section 20 of the Exchange Act, and shall survive
            any termination of this Agreement or the issuance and delivery of
            the Shares. The Fund, the Investment Adviser, the Sub-Adviser and
            each Underwriter agree promptly to notify each other of the
            commencement of any Proceeding against it and, in the case of the
            Fund, the Investment Adviser or the Sub-Adviser, against any of the
            Fund's, the Adviser's or the Sub-Adviser's shareholders, partners,
            managers, members, trustees, directors or officers in connection
            with the issuance and sale of the Shares, or in connection with the
            Registration Statement or Prospectus.

      (f)   The Fund, the Investment Adviser and the Sub-Adviser each
            acknowledge that the statements with respect to (1) the public
            offering of the Shares as set forth on the cover page of and (2)
            stabilization and selling concessions and reallowances of selling
            concessions and payment of fees to Underwriters that meet certain
            minimum sales thresholds under the caption "Underwriting" in the
            Prospectus constitute the only information furnished in writing to
            the Fund by the Underwriters expressly for use in such document. The
            Underwriters severally confirm that these statements are correct in
            all material respects and were so furnished by or on behalf of the
            Underwriters severally for use in the Prospectus.

      (g)   Notwithstanding any other provisions in this Section 9, no party
            shall be entitled to indemnification or contribution under this
            Underwriting Agreement against any loss, claim, liability, expense
            or damage arising by reason of such person's willful misfeasance,
            bad faith, gross negligence or reckless disregard of its duties in
            the performance of its duties hereunder. The parties hereto
            acknowledge that the foregoing provision shall be applicable solely
            as to matters arising under Section 17(i) of the Investment Company
            Act, and shall not be construed to impose any duties or obligations
            upon any such parties under this Agreement other than as
            specifically set forth herein (it being understood that the
            Underwriters have no duty hereunder to the Fund to perform any due
            diligence investigation).

10.   NOTICES. Except as otherwise herein provided, all statements, requests,
      notices and agreements shall be in writing or by telegram and, if to the
      Underwriters,


                                       27
<PAGE>

      shall be sufficient in all respects if delivered or sent to UBS Securities
      LLC, 299 Park Avenue, New York, NY 10171-0026, Attention: Syndicate
      Department, if to the Fund or the Investment Adviser, shall be sufficient
      in all respects if delivered or sent to the Fund or the Investment
      Adviser, as the case may be, at the offices of the Fund and the Investment
      Adviser at Eaton Vance Management, 255 State Street, Boston, MA 02109,
      and, if to the Sub-Adviser, shall be sufficient in all respects if
      delivered or sent to Rampart Investment Management Company Inc., One
      International Place, Boston, MA 02110.

11.   GOVERNING LAW; CONSTRUCTION. This Agreement and any claim, counterclaim or
      dispute of any kind or nature whatsoever arising out of or in any way
      relating to this Agreement ("Claim"), directly or indirectly, shall be
      governed by, and construed in accordance with, the laws of the State of
      New York. The Section headings in this Agreement have been inserted as a
      matter of convenience of reference and are not a part of this Agreement.

12.   SUBMISSION TO JURISDICTION. Except as set forth below, no Claim may be
      commenced, prosecuted or continued in any court other than the courts of
      the State of New York located in the City and County of New York or in the
      United States District Court for the Southern District of New York, which
      courts shall have jurisdiction over the adjudication of such matters, and
      the Fund and UBS Securities each consent to the jurisdiction of such
      courts and personal service with respect thereto. The Fund and UBS
      Securities hereby consent to personal jurisdiction, service and venue in
      any court in which any Claim arising out of or in any way relating to this
      Agreement is brought by any third party against UBS Securities or any
      indemnified party. Each of UBS Securities, the Fund (on its behalf and, to
      the extent permitted by applicable law, on behalf of its stockholders and
      affiliates), the Investment Adviser (on its behalf and, to the extent
      permitted by applicable law, on behalf of its unitholders and affiliates)
      and the Sub-Adviser (on its behalf and, to the extent permitted by
      applicable law, on behalf of its shareholders and affiliates) waives all
      right to trial by jury in any action, proceeding or counterclaim (whether
      based upon contract, tort or otherwise) in any way arising out of or
      relating to this Agreement. Each of the Fund, the Investment Adviser and
      the Sub-Adviser agrees that a final judgment in any such action,
      proceeding or counterclaim brought in any such court shall be conclusive
      and binding upon the Fund, the Investment Adviser and the Sub-Adviser, as
      the case may be, and may be enforced in any other courts in the
      jurisdiction of which the Fund, the Investment Adviser and the
      Sub-Adviser, as the case may be, is or may be subject, by suit upon such
      judgment.

13.   PARTIES AT INTEREST. The Agreement herein set forth has been and is made
      solely for the benefit of the Underwriters, the Fund, the Investment
      Adviser and the Sub-Adviser and to the extent provided in Section 9 hereof
      the controlling persons, shareholders, partners, members, trustees,
      managers, directors and officers referred to in such section, and their
      respective successors, assigns, heirs, personal representatives and
      executors and administrators. No other person, partnership, association or
      corporation (including a purchaser, as such purchaser, from any of


                                       28
<PAGE>

      the Underwriters) shall acquire or have any right under or by virtue of
      this Agreement.

14.   COUNTERPARTS. This Agreement may be signed by the parties in one or more
      counterparts which together shall constitute one and the same agreement
      among the parties.

15.   SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
      Underwriters, the Fund, the Investment Adviser, the Sub-Adviser and any
      successor or assign of any substantial portion of the Fund's, the
      Investment Adviser's, the Sub-Adviser's, or any of the Underwriters'
      respective businesses and/or assets.

16.   DISCLAIMER OF LIABILITY OF TRUSTEES AND BENEFICIARIES. A copy of the
      Agreement and Declaration of Trust of each of the Fund and Eaton Vance is
      on file with the Secretary of State of The Commonwealth of Massachusetts,
      and notice hereby is given that this Underwriting Agreement is executed on
      behalf of the Fund and Eaton Vance, respectively, by an officer or Trustee
      of the Fund or Eaton Vance, as the case may be, in his or her capacity as
      an officer or Trustee of the Fund or Eaton Vance, as the case may be, and
      not individually and that the obligations under or arising out of this
      Underwriting Agreement are not binding upon any of the Trustees, officers
      or shareholders individually but are binding only upon the assets and
      properties of the Fund or Eaton Vance, as the case may be.


                                       29
<PAGE>


      If the foregoing correctly sets forth the understanding among the Fund,
the Investment Adviser, the Sub-Adviser and the Underwriters, please so indicate
in the space provided below, whereupon this letter and your acceptance shall
constitute a binding agreement among the Fund, the Investment Adviser, the
Sub-Adviser and the Underwriters, severally.

                                       Very truly yours,

                                       EATON VANCE ENHANCED EQUITY INCOME
                                       FUND II


                                       -----------------------------------------
                                       By:
                                       Title:


                                       EATON VANCE MANAGEMENT


                                       -----------------------------------------
                                       By:
                                       Title:


                                       RAMPART INVESTMENT MANAGEMENT COMPANY,
                                       INC.


                                       -----------------------------------------
                                       By:
                                       Title:


                                       30
<PAGE>



Accepted and agreed to as of the
date first above written, on behalf
of themselves and the other several
Underwriters named in Schedule A


UBS SECURITIES LLC


--------------------------
By:
Title:


--------------------------
By:
Title:


                                       31
<PAGE>


SCHEDULE A

<TABLE>
<CAPTION>
Underwriters                                                    Number of Shares
------------                                                    ----------------
<S>                                                             <C>
UBS Securities LLC..........................................           [ ]
[Other Underwriters]                                                   [ ]
  Total.....................................................           [ ]
                                                                     ======
</TABLE>


                                  Schedule A-1
<PAGE>


                                   SCHEDULE B

                               FORM OF OPINION OF
                  KIRKPATRICK & LOCKHART LLP REGARDING THE FUND

            1. The Registration Statement and all post-effective amendments, if
any, are effective under the Securities Act and no stop order with respect
thereto has been issued and no proceeding for that purpose has been instituted
or, to the best of our knowledge, is threatened by the Commission. Any filing of
the Prospectus or any supplements thereto required under Rule 497 of the
Securities Act Rules prior to the date hereof have been made in the manner and
within the time required by such rule.

            2. The Fund has been duly formed and is validly existing as a
Massachusetts business trust under the laws of the Commonwealth of
Massachusetts, with full power and authority to conduct all the activities
conducted by it, to own or lease all assets owned (or to be owned) or leased (or
to be leased) by it and to conduct its business as described in the Registration
Statement and Prospectus, and the Fund is duly licensed and qualified to do
business and in good standing in each jurisdiction in which its ownership or
leasing of property or its conducting of business requires such qualification,
and the Fund owns, possesses or has obtained and currently maintains all
governmental licenses, permits, consents, orders, approvals and other
authorizations, whether foreign or domestic, necessary to carry on its business
as contemplated in the Prospectus. The Fund has no subsidiaries.

            3. The capitalization of the Fund is as set forth in the
Registration Statement and the Prospectus. The Shares of Beneficial Interest of
the Fund conform in all respects to the description of them in the Prospectus.
All the outstanding Shares of Beneficial Interest have been duly authorized and
are validly issued, fully paid and nonassessable (except as described in the
Registration Statement). The Shares to be issued and delivered to and paid for
by the Underwriters in accordance with the Underwriting Agreement against
payment therefor as provided by the Underwriting Agreement have been duly
authorized and when issued and delivered to the Underwriters will have been
validly issued and will be fully paid and nonassessable (except as described in
the Registration Statement). No person is entitled to any preemptive or other
similar rights with respect to the Shares.

            4. The Fund is duly registered with the Commission under the
Investment Company Act as a diversified, closed-end management investment
company and all action under the Securities Act, the Investment Company Act, the
Securities Act Rules and the Investment Company Act Rules, as the case may be,
necessary to make the public offering and consummate the sale of the Shares as
provided in the Underwriting Agreement has or will have been taken by the Fund.

            5. The Fund has full power and authority to enter into each of the
Underwriting Agreement, the Investment Advisory Agreement, the Sub-Advisory
Agreement, the Custodian Agreement, the Administration Agreement, and the
Transfer Agency Agreement (collectively, the "Fund Agreements") and to perform
all of the terms


                                  Schedule B-1
<PAGE>

and provisions thereof to be carried out by it and (A) each Fund Agreement has
been duly and validly authorized, executed and delivered by the Fund, (B) each
Fund Agreement complies in all material respects with all applicable provisions
of the Investment Company Act, the Advisers Act , the Investment Company Act
Rules and the Advisers Act Rules, as the case may be, and (C) assuming due
authorization, execution and delivery by the other parties thereto, each Fund
Agreement constitutes the legal, valid and binding obligation of the Fund
enforceable in accordance with its terms, (1) subject, as to enforcement, to
applicable bankruptcy, insolvency and similar laws affecting creditors' rights
generally and to general equitable principles (regardless of whether enforcement
is sought in a proceeding in equity or at law) and (2) as rights to indemnity
thereunder may be limited by federal or state securities laws.

            6. None of (A) the execution and delivery by the Fund of the Fund
Agreements, (B) the issue and sale by the Fund of the Shares as contemplated by
the Underwriting Agreement and (C) the performance by the Fund of its
obligations under the Fund Agreements or consummation by the Fund of the other
transactions contemplated by the Fund Agreements conflicts with or will conflict
with, or results or will result in a breach of, the Declaration of Trust or the
By-laws of the Fund or any agreement or instrument to which the Fund is a party
or by which the Fund is bound, or any law, rule or regulation, or order of any
court, governmental instrumentality, securities exchange or association or
arbitrator, whether foreign or domestic, applicable to the Fund, except that we
express no opinion as to the securities or "blue sky" laws applicable in
connection with the purchase and distribution of the Shares by the Underwriters
pursuant to the Underwriting Agreement.

            7. The Fund is not currently in breach of, or in default under, any
written agreement or instrument to which it is a party or by which it or its
property is bound or affected.

            8. No consent, approval, authorization or order of any court or
governmental agency or body or securities exchange or association, whether
foreign or domestic, is required by the Fund for the consummation by the Fund of
the transactions to be performed by the Fund or the performance by the Fund of
all the terms and provisions to be performed by or on behalf of it in each case
as contemplated in the Fund Agreements, except such as (A) have been obtained
under the Securities Act, the Investment Company Act, the Advisers Act, the
Securities Act Rules, the Investment Company Act Rules and the Advisers Act
Rules and (B) may be required by the New York Stock Exchange or under state
securities or "blue sky" laws in connection with the purchase and distribution
of the Shares by the Underwriters pursuant to the Underwriting Agreement.

            9. The Shares have been approved for listing on the New York Stock
Exchange, subject to official notice of issuance, and the Fund's Registration
Statement on Form 8-A under the 1934 Act is effective.


                                  Schedule B-2
<PAGE>

            10. There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other governmental agency
or body, foreign or domestic, now pending or, to our knowledge, threatened
against or affecting the Fund, which is required to be disclosed in the
Prospectus that is not disclosed in the Prospectus, and there are no contracts,
franchises or other documents that are of a character required to be described
in, or that are required to be filed as exhibits to, the Registration Statement
that have not been described or filed as required.

            11. The Fund does not require any tax or other rulings to enable it
to qualify as a regulated investment company under Subchapter M of the Code.

            12. Each of the section in the Prospectus entitled "Distributions --
Federal Income Tax Matters" and the section in the Statement of Additional
Information entitled "Taxes" is a fair summary of the principal United States
federal income tax rules currently in effect applicable to the Fund and to the
purchase, ownership and disposition of the Shares.

            13. The Registration Statement (except the financial statements and
schedules and other financial data included therein as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, complied as to form in all material respects
to the requirements of the Securities Act, the Investment Company Act and the
rules and regulations of the Commission thereunder.

            In rendering our opinion, we have relied, as to factual matters,
upon the attached written certificates and statements of officers of the Fund.

            In connection with the registration of the Shares, we have advised
the Fund as to the requirements of the Securities Act, the Investment Company
Act and the applicable rules and regulations of the Commission thereunder and
have rendered other legal advice and assistance to the Fund in the course of its
preparation of the Registration Statement and the Prospectus. Rendering such
assistance involved, among other things, discussions and inquiries concerning
various legal and related subjects and reviews of certain corporate records,
documents and proceedings. We also participated in conferences with
representatives of the Fund and its accountants at which the contents of the
Registration Statement and Prospectus and related matters were discussed. With
your permission, we have not undertaken, except as otherwise indicated herein,
to determine independently, and do not assume any responsibility for, the
accuracy, completeness or fairness of the statements in the Registration
Statement or Prospectus. On the basis of the information which was developed in
the course of the performance of the services referred to above, no information
has come to our attention that would lead us to believe that the Registration
Statement, at the time it became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the date hereof, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements


                                  Schedule B-3
<PAGE>

therein, in the light of the circumstances under which they were made, not
misleading or that any amendment or supplement to the Prospectus, as of its
respective date, and as of the date hereof, contained any untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements in the Prospectus, in the light of the circumstances under
which they were made, not misleading (except the financial statements, schedules
and other financial data included therein, as to which we express no view).


                                  Schedule B-4
<PAGE>


                                   SCHEDULE C

                       FORM OF OPINION OF INTERNAL COUNSEL
                        REGARDING EATON VANCE MANAGEMENT

            1. Eaton Vance has been duly formed and is validly existing as a
Massachusetts business trust under the laws of its jurisdiction of incorporation
with full power and authority to conduct all of the activities conducted by it,
to own or lease all of the assets owned or leased by it and to conduct its
business as described in the Registration Statement and Prospectus, and Eaton
Vance is duly licensed and qualified and in good standing in each other
jurisdiction in which it is required to be so qualified and Eaton Vance owns,
possesses or has obtained and currently maintains all governmental licenses,
permits, consents, orders, approvals and other authorizations, whether foreign
or domestic, necessary for Eaton Vance to carry on its business as contemplated
in the Registration Statement and the Prospectus.

            2. Eaton Vance is duly registered as an investment adviser under the
Advisers Act and is not prohibited by the Advisers Act, the Investment Company
Act, the Advisers Act Rules or the Investment Company Act Rules from acting as
investment adviser for the Fund as contemplated by the Investment Advisory
Agreement, the Registration Statement and the Prospectus.

            3. Eaton Vance has full power and authority to enter into each of
the Underwriting Agreement, the Investment Advisory Agreement, the Sub-Advisory
Agreement, the Administration Agreement, the Additional Compensation Agreement,
and the Shareholder Servicing Agreement (collectively, the "Eaton Vance
Agreements") and to carry out all the terms and provisions thereof to be carried
out by it, and each such agreement has been duly and validly authorized,
executed and delivered by Eaton Vance; each Eaton Vance Agreement complies in
all material respects with all provisions of the Investment Company Act, the
Advisers Act, the Investment Company Act Rules and the Advisers Act Rules; and
assuming due authorization, execution and delivery by the other parties thereto,
each Eaton Vance Agreement constitutes a legal, valid and binding obligation of
Eaton Vance, enforceable in accordance with its terms, (1) subject, as to
enforcement, to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general equitable principles (regardless of
whether enforcement is sought in a proceeding in equity or at law) and (2) as
rights to indemnity thereunder may be limited by federal or state securities
laws.

            4. Neither (A) the execution and delivery by Eaton Vance of any
Eaton Vance Agreement nor (B) the consummation by Eaton Vance of the
transactions contemplated by, or the performance of its obligations under any
Eaton Vance Agreement conflicts or will conflict with, or results or will result
in a breach of, the Agreement and Declaration of Trust or By-Laws of Eaton Vance
or any agreement or instrument to which Eaton Vance is a party or by which Eaton
Vance is bound, or any law, rule or regulation, or order of any court,
governmental instrumentality, securities


                                  Schedule C-1
<PAGE>

exchange or association or arbitrator, whether foreign or domestic, applicable
to Eaton Vance.

            5. No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or association, whether
foreign or domestic, is required for the consummation of the transactions
contemplated in, or the performance by Eaton Vance of its obligations under, any
Eaton Vance Agreement, except such as have been obtained under the Investment
Company Act, the Advisers Act, the Securities Act, the Investment Company Act
Rules, the Advisers Act Rules and the Securities Act Rules.

            6. The description of Eaton Vance and its business, and the
statements attributable to Eaton Vance, in the Registration Statement and the
Prospectus complies with the requirements of the Securities Act, the Investment
Company Act, the Securities Act Rules and the Investment Company Act Rules and
do not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading.

            7. There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other governmental agency
or body, foreign or domestic, now pending or, to our knowledge, threatened
against or affecting Eaton Vance of a nature required to be disclosed in the
Registration Statement or Prospectus or that might reasonably result in any
material adverse change in the condition, financial or otherwise, business
affairs or business prospects of Eaton Vance or the ability of Eaton Vance to
fulfill its respective obligations under any Eaton Vance Agreement.

            8. The Registration Statement (except the financial statements and
schedules and other financial data included therein as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act,
the Investment Company Act and the rules and regulations of the Commission
thereunder.

            In rendering our opinion, we have relied, as to factual matters,
upon the attached written certificates and statements of officers of Eaton
Vance.

            In connection with the registration of the Shares, we have advised
Eaton Vance as to the requirements of the Securities Act, the Investment Company
Act and the applicable rules and regulations of the Commission thereunder and
have rendered other legal advice and assistance to Eaton Vance in the course of
the preparation of the registration Statement and the Prospectus. Rendering such
assistance involved, among other things, discussions and inquiries concerning
various legal and related subjects and reviews of certain corporate records,
documents and proceedings. We also participated in conferences with
representatives of the Fund and its accountants and Eaton Vance at which the
contents of the registration and Prospectus and related matters were discussed.


                                  Schedule C-2
<PAGE>

With your permission, we have not undertaken, except as otherwise indicated
herein, to determine independently, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements in the Registration
Statement or Prospectus. On the basis of the information which was developed in
the course of the performance of the services referred to above, no information
has come to our attention that would lead us to believe that the Registration
Statement, at the time it became effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the date hereof, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that any amendment
or supplement to the Prospectus, as of its respective date, and as of the date
hereof, contained any untrue statement of a material fact or omitted or omits to
state a material fact necessary in order to make the statements in the
Prospectus, in the light of the circumstances under which they were made, not
misleading (except the financial statements, schedules and other financial data
included therein, as to which we express no view).


                                  Schedule C-3
<PAGE>


                                   SCHEDULE D

                  FORM OF OPINION OF KIRKPATRICK & LOCKHART LLP
              REGARDING RAMPART INVESTMENT MANAGEMENT COMPANY, INC.

            1. Rampart Investment Management Company, Inc. (the "Sub-Adviser")
has been duly formed and is validly existing as a Massachusetts corporation
under the laws of its jurisdiction of incorporation with full power and
authority to conduct all of the activities conducted by it, to own or lease all
of the assets owned or leased by it and to conduct its business as described in
the Registration Statement and Prospectus, and the Sub-Adviser is duly licensed
and qualified and in good standing in each other jurisdiction in which it is
required to be so qualified and the Sub-Adviser owns, possesses or has obtained
and currently maintains all governmental licenses, permits, consents, orders,
approvals and other authorizations, whether foreign or domestic, necessary for
the Sub-Adviser to carry on its business as contemplated in the Registration
Statement and the Prospectus.

            2. The Sub-Adviser is duly registered as an investment adviser under
the Advisers Act and is not prohibited by the Advisers Act, the Investment
Company Act, the Advisers Act Rules or the Investment Company Act Rules from
acting as investment adviser for the Fund as contemplated by the Sub-Advisory
Agreement, the Registration Statement and the Prospectus.

            3. The Sub-Adviser has full power and authority to enter into each
of the Underwriting Agreement and the Sub-Advisory Agreement (collectively, the
"Sub-Adviser Agreements") and to carry out all the terms and provisions thereof
to be carried out by it, and each such agreement has been duly and validly
authorized, executed and delivered by the Sub-Adviser; each Sub-Adviser
Agreement complies in all material respects with all provisions of the
Investment Company Act, the Advisers Act, the Investment Company Act Rules and
the Advisers Act Rules; and assuming due authorization, execution and delivery
by the other parties thereto, each Sub-Adviser Agreement constitutes a legal,
valid and binding obligation of the Sub-Adviser, enforceable in accordance with
its terms, (1) subject, as to enforcement, to applicable bankruptcy, insolvency
and similar laws affecting creditors' rights generally and to general equitable
principles (regardless of whether enforcement is sought in a proceeding in
equity or at law) and (2) as rights to indemnity thereunder may be limited by
federal or state securities laws.

            4. Neither (A) the execution and delivery by the Sub-Adviser of any
Sub-Adviser Agreement nor (B) the consummation by the Sub-Adviser of the
transactions contemplated by, or the performance of its obligations under any
Sub-Adviser Agreement conflicts or will conflict with, or results or will result
in a breach of, the Articles of Incorporation or By-Laws of the Sub-Adviser or
any agreement or instrument to which the Sub-Adviser is a party or by which the
Sub-Adviser is bound, or any law, rule or regulation, or order of any court,
governmental instrumentality, securities exchange or association or arbitrator,
whether foreign or domestic, applicable to the Sub-Adviser.


                                  Schedule D-1
<PAGE>

            5. No consent, approval, authorization or order of any court,
governmental agency or body or securities exchange or association, whether
foreign or domestic, is required for the consummation of the transactions
contemplated in, or the performance by the Sub-Adviser of its obligations under,
any Sub-Adviser Agreement, except such as have been obtained under the
Investment Company Act, the Advisers Act, the Securities Act, the Investment
Company Act Rules, the Advisers Act Rules and the Securities Act Rules.

            6. The description of the Sub-Adviser and its business, and the
statements attributable to the Sub-Adviser, in the Registration Statement and
the Prospectus complies with the requirements of the Securities Act, the
Investment Company Act, the Securities Act Rules and the Investment Company Act
Rules and do not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein not misleading.

            7. There is no action, suit or proceeding before or by any court,
commission, regulatory body, administrative agency or other governmental agency
or body, foreign or domestic, now pending or, to our knowledge, threatened
against or affecting the Sub-Adviser of a nature required to be disclosed in the
Registration Statement or Prospectus or that might reasonably result in any
material adverse change in the condition, financial or otherwise, business
affairs or business prospects of the Sub-Adviser or the ability of the
Sub-Adviser to fulfill its respective obligations under any Sub-Adviser
Agreement.

            8. The Registration Statement (except the financial statements and
schedules and other financial data included therein as to which we express no
view), at the time it became effective, and the Prospectus (except as
aforesaid), as of the date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act,
the Investment Company Act and the rules and regulations of the Commission
thereunder.

            In rendering our opinion, we have relied, as to factual matters,
upon the attached written certificates and statements of officers of the
Sub-Adviser.

            In connection with the registration of the Shares, we have advised
the Sub-Adviser as to the requirements of the Securities Act, the Investment
Company Act and the applicable rules and regulations of the Commission
thereunder and have rendered other legal advice and assistance to the
Sub-Adviser in the course of the preparation of the registration Statement and
the Prospectus. Rendering such assistance involved, among other things,
discussions and inquiries concerning various legal and related subjects and
reviews of certain corporate records, documents and proceedings. We also
participated in conferences with representatives of the Fund and its accountants
and the Sub-Adviser at which the contents of the registration and Prospectus and
related matters were discussed. With your permission, we have not undertaken,
except as otherwise indicated herein, to determine independently, and do not
assume any responsibility for, the accuracy, completeness or fairness of the
statements in the Registration Statement or


                                  Schedule D-2
<PAGE>

Prospectus. On the basis of the information which was developed in the course of
the performance of the services referred to above, no information has come to
our attention that would lead us to believe that the Registration Statement, at
the time it became effective, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, or that the Prospectus, as of its
date and as of the date hereof, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading or that any amendment or supplement to the Prospectus,
as of its respective date, and as of the date hereof, contained any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements in the Prospectus, in the light of the
circumstances under which they were made, not misleading (except the financial
statements, schedules and other financial data included therein, as to which we
express no view).


                                  Schedule D-3
<PAGE>


                                   SCHEDULE E

                           FORM OF ACCOUNTANT'S LETTER

              , 2005

The Board of Trustees of
Eaton Vance Enhanced Equity Income Fund II
The Eaton Vance Building
255 State Street
Boston, Massachusetts 02109

UBS Securities LLC
299 Park Avenue
New York, New York  10171
         as Managing Representative of the Underwriters

Ladies and Gentlemen:

            We have audited the statement of assets and liabilities of Eaton
Vance Enhanced Equity Income Fund II (the "Fund") as of [ ], 2005 included in
the Registration Statement on Form N-2 filed by the Fund under the Securities
Act of 1933 (the "Securities Act") (File No. 333-[ ]) and under the Investment
Company Act of 1940 (the "Investment Company Act") (File No. 811-[ ]); such
statement and our report with respect to such statement are included in the
Registration Statement.

In connection with the Registration Statement:

            1. We are independent public accountants with respect to the Fund
within the meaning of the Securities Act and the applicable rules and
regulations thereunder.

            2. In our opinion, the statement of assets and liabilities included
in the Registration Statement and audited by us complies as to form in all
respects with the applicable accounting requirements of the Securities Act, the
Investment Company Act and the respective rules and regulations thereunder.

            3. For purposes of this letter we have read the minutes of all
meetings of the Shareholders, the Board of Trustees and all Committees of the
Board of Trustees of the Fund as set forth in the minute books at the offices of
the Fund, officials of the Fund having advised us that the minutes of all such
meetings through [ ], 2005, were set forth therein.

            4. Fund officials have advised us that no financial statements as of
any date subsequent to [ ], 2005, are available. We have made inquiries of
certain officials of the Fund who have responsibility for financial and
accounting matters


                                  Schedule E-1
<PAGE>

regarding whether there was any change at [ ], 2005, in the capital shares or
net assets of the Fund as compared with amounts shown in the [ ], 2005,
statement of assets and liabilities included in the Registration Statement,
except for changes that the Registration Statement discloses have occurred or
may occur. On the basis of our inquiries and our reading of the minutes as
described in Paragraph 3, nothing came to our attention that caused us to
believe that there were any such changes.

            The foregoing procedures do not constitute an audit made in
accordance with generally accepted auditing standards. Accordingly, we make no
representations as to the sufficiency of the foregoing procedures for your
purposes.

            This letter is solely for the information of the addressees and to
assist the underwriters in conducting and documenting their investigation of the
affairs of the Fund in connection with the offering of the securities covered by
the Registration Statement, and is not to be used, circulated, quoted or
otherwise referred to within or without the underwriting group for any other
purpose, including but not limited to the registration, purchase or sale of
securities, nor is it to be filed with or referred to in whole or in part in the
Registration Statement or any other document, except that reference may be made
to it in the underwriting agreement or in any list of closing documents
pertaining to the offering of the securities covered by the Registration
Statement.

                                          Very truly yours,




                                  Schedule E-2



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(H)(2)
<SEQUENCE>7
<FILENAME>b52674a1exv99wxhyx2y.txt
<DESCRIPTION>EX-99.(H)(2) FORM OF MASTER AGREEMENT AMONG UNDERWRITERS
<TEXT>
<PAGE>
                                                                  Exhibit (h)(2)

                       Master Agreement Among Underwriters

UBS Securities LLC
299 Park Avenue
New York, New York 10171-0026

Ladies and Gentlemen:

We hereby agree that this Master Agreement Among Underwriters (this "Agreement")
will apply to our participation in offerings of securities where you act as
Manager or one of the Managers of the underwriting syndicate (including
offerings subject to competitive bidding where you act as Representative of a
group of bidders or purchasers). The issuer of the securities is referred to as
the "Company", the seller of any such securities other than the Company is
referred to as the "Seller" and such securities are referred to as the
"Securities".

1.    Applicability

This Agreement as amended or supplemented by the Terms Communication (as defined
below) will apply to any offering of Securities, pursuant to a registration
statement filed under the Securities Act of 1933, as amended, and the rules and
regulations thereunder (collectively, the "Securities Act"), or exempt from such
registration, where you have informed us that this Agreement applies. Any such
offering in which we participate as an Underwriter is referred to as an
"Offering".

You may, from time to time, invite us to participate in an Offering by sending a
wire, telex, facsimile or other means of invitation relating to that Offering
(an "Invitation"). As to any such Offering, you will promptly advise us of the
following as applicable: the amount of Securities to be underwritten by us, the
expected offering and closing dates, the offering price and the purchase price,
the interest or dividend rate (or the method by which such rate is to be
determined), the conversion price, the underwriting discount, the management
fee, the concession and the reallowance. If the offering price is to be
determined by a formula based upon the market price of certain securities
("Formula Pricing"), you will so indicate and specify the maximum underwriting
discount, management fee and concession. You will also advise us if the Offering
includes Delayed Delivery Contracts or if the Underwriting Agreement (as defined
below) grants the Underwriters an option to purchase additional Securities (the
"Option Securities"). The foregoing information may be conveyed in the
Invitation or in a Terms Wire substantially in the forms of Exhibits A and B
hereto, respectively (collectively, the "Terms Communication"). The Terms
Communication may also supplement or amend the terms of this Agreement
applicable to an Offering.
<PAGE>
Receipt of our acceptance substantially in the form set forth in Exhibit A
without receipt of our written revocation before the time specified in the Terms
Communication constitutes our "Final Acceptance". By our Final Acceptance, we
agree that this Agreement will be incorporated by reference in such Terms
Communication as though set forth in its entirety and will govern our
participation in such Offering.

2.    Underwriting Agreement and Master Underwriters' Questionnaire

For each Offering, the Company, any Seller and/or any guarantor of such
Securities will enter into an underwriting or purchase agreement or similar
agreement (the "Underwriting Agreement"), which will be sent to us, available
for review in your office or in publicly available form with the Securities and
Exchange Commission (the "Commission"). By our Final Acceptance, we authorize
you to purchase on our behalf the amount of the Securities set forth in the
Terms Communication (our "Initial Commitment") plus our share of any Option
Securities less any amount of our Securities to be sold pursuant to Delayed
Delivery Contracts under Section 7 below. The Securities we are obligated to
purchase after any such adjustment are referred to as "Our Securities." If the
Securities are debt obligations maturing serially, our allocation of the
maturities will be proportionate to our underwriting obligation.

Our Final Acceptance will also constitute (i) our representation that our
commitment with respect to the Offering will not violate any applicable capital
requirements of the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder (collectively, the "Exchange Act"), the National
Association of Securities Dealers, Inc. ("NASD") or any securities exchange and
(ii) our confirmation that the information given or deemed given in response to
the Master Underwriters' Questionnaire attached as Exhibit C is correct. We will
notify you immediately whenever such information becomes inaccurate or
incomplete during an Offering.

3.    Offering Documents

Registered Offerings. For an Offering of Securities registered under the
Securities Act ("Registered Offering"), you will provide the file number(s) of
the Registration Statement (as defined below) filed with the Commission or, to
the extent made available by the Company, send us or make available for our
review in your office a copy of such Registration Statement except for any
exhibits and documents incorporated therein by reference. As soon as practicable
after sufficient quantities of the final prospectus (excluding documents
incorporated by reference therein) are made available to you by the Company to
be used in connection with the Offering of the Securities, you will furnish to
us sufficient copies thereof or arrange to have such copies furnished to us. We
understand that we are not authorized to give any information or make any
representation not contained in the Prospectus (including documents incorporated
by reference therein), as amended or supplemented, in connection with the
Offering.

Our Final Acceptance will constitute (i) our acknowledgment that we are familiar
with such Registration Statement, as amended to the date of the Offering,
including any exhibits or


                                       2
<PAGE>
documents incorporated therein by reference (the "Registration Statement"), and
with any preliminary prospectus, final prospectus, or prospectus supplement
filed with the Commission (collectively, the "Prospectus") and the forms of
Underwriting Agreement and indenture or other document describing the terms of
the Securities filed as exhibits thereto or otherwise made available to us, (ii)
our representation that the information relating to us in such Registration
Statement and Prospectus is correct and not misleading, (iii) our consent to be
named as an Underwriter therein, and (iv) our representation that we will
furnish a Prospectus to each person to whom we sell Securities or to whom we
furnished a previous Prospectus as required by applicable regulation or as
requested by you. We will maintain accurate records of our distribution of the
Registration Statement and the Prospectus.

Where specified in the Terms Communication, we will not without your consent
sell any of the Securities to an account over which we have investment
discretion.

Offerings Pursuant to Offering Circular. For other than a Registered Offering,
you will provide or make available to us for our review in your office, to the
extent made available by the Company, copies of any preliminary and final
offering circulars or other offering materials and any amendments thereto (the
"Offering Circular"). As soon as practicable after sufficient quantities of the
final offering circular (excluding documents incorporated by reference therein)
are made available to you by the Company to be used in connection with the
Offering of the Securities, you will furnish to us sufficient copies thereof or
arrange to have such copies furnished to us. We understand that we are not
authorized to give any information or make any representation not contained in
the Offering Circular (including documents incorporated by reference therein),
as amended or supplemented, in connection with the Offering.

Our Final Acceptance will also constitute (i) our acknowledgment that we are
familiar with the Offering Circular, and the forms of Underwriting Agreement and
indenture or other document describing the terms of the Securities made
available to us (ii) our representation that the information relating to us in
the Offering Circular is correct and not misleading, (iii) our consent to being
named as an Underwriter therein, and (iv) our representation that we will
furnish an Offering Circular to each person to whom we sell Securities or to
whom we furnish a previous Offering Circular as required by any regulation or as
requested by you. We will maintain accurate records of our distribution of the
Offering Circular.

4.    Manager's Authority

We authorize you, acting as Manager, to (i) negotiate, execute and deliver the
Underwriting Agreement, (ii) exercise all authority and discretion granted by
the Underwriting Agreement and take all action you deem desirable in connection
with this Agreement and the Underwriting Agreement including, but not limited
to, waiving performance or satisfaction by the Company, any selling security
holder or any other party to the Underwriting Agreement of its or their
obligations or conditions included in the Underwriting Agreement or the Terms
Communication (including this Agreement), if in your judgment such waiver will
not have a material adverse effect upon the interests of the Underwriters and
exercising any right of cancellation or


                                       3
<PAGE>
termination, (iii) modify, vary or waive any provision in the Underwriting
Agreement except the amount of Our Securities or the purchase price (except you
may determine the price by Formula Pricing where applicable), (iv) determine the
timing and the terms of the Offering (including varying the offering terms and
the concessions and discounts to dealers), (v) exercise any option relating to
the purchase of Option Securities, and (vi) take all action you deem desirable
in connection with the Offering and the purchase, carrying, sale and
distribution of the Securities. If there are other Managers with respect to an
Offering, you may take any action hereunder alone on behalf of the Managers, and
our representations, agreements and authorizations given herein shall also be
for the benefit of such other Manager to whom you may grant any of your
authority to act hereunder.

You may arrange for the purchase by others, who may include your or other
Underwriters, of any Securities not taken up by an Underwriter in respect of its
obligations hereunder who defaults under this Agreement and/or the Underwriting
Agreement. We will assume our proportionate share of all defaulted obligations
not assumed by others and any Securities so assumed shall be included in Our
Securities. However, nothing in this paragraph will affect our liability or
obligations in the event of a default by us or any other Underwriter(s).

You may advertise the Offering as you determine and determine all matters
relating to communications with dealers or others. We will not advertise the
Offering without your consent, and we assume all expense and risk with respect
to any advertising by us.

Notwithstanding any information you furnish as to jurisdictions where you
believe the Securities may be sold, you have no obligation for qualification of
the Securities for sale under the laws of any jurisdiction. You may file a New
York Further State Notice. You have no liability to us except for your own lack
of good faith in meeting obligations expressly assumed by you hereunder.

5.    Management Fee

We will pay and authorize you to charge our account with our share of the
Management Fee set forth in the Terms Communication and calculated without
deduction in respect of any Delayed Delivery Securities. Such compensation may
be divided among the Managers as you decide.

6.    Offering

We will comply with any applicable requirement of the Securities Act, the
Exchange Act and any other applicable Federal or state statute and the rules and
regulations thereunder. We will make no sales of Securities until you release us
to do so. Any Securities released to us for public offering will be promptly
offered in conformity with the Prospectus or Offering Circular and we will not
allow any discount except as permitted by this Agreement. If we offer Securities
outside the United States, its territories or possessions, we will take all
action necessary to comply with all applicable laws at our own expense and risk.
You may reserve for sale, sell and deliver for our account any of Our Securities
(i) to customers, (ii) to dealers (including Underwriters) who


                                       4
<PAGE>
are members of the NASD and agree to comply with the terms of Section 16 below
and (iii) to foreign dealers or other institutions (including Underwriters) not
eligible for NASD membership who agree to comply with the terms of Section 16
below. Sales of Securities to customers for the account of Underwriters will be
as nearly as practicable in proportion to their respective Initial Commitments,
and sales of Securities to dealers for the account of Underwriters will be as
nearly as practicable in proportion to each Underwriter's pro rata share of
Securities reserved for such sales. You will advise us of the amount of Our
Securities which we will retain for direct sale. Any Securities reserved by you
for sale for our account but not sold may be released by you to us for direct
sale, in which event the amount of Securities so reserved shall be
correspondingly reduced. We will obtain an agreement containing the
representations in Section 16 below from dealers to whom we sell Securities.

In connection with any Offering of Securities that are registered under the Act
and issued by a company that was not, immediately prior to the filing of the
Registration Statement, subject to the requirements of Section 13(a) or 15(d) of
the Exchange Act, we agree that unless otherwise advised by you and disclosed in
the Prospectus we will not make sales to any account over which we exercise
discretionary authority with respect to that sale (discretionary accounts). We
will advise you on request of the unsold amount of Our Securities. You may at
any time (i) reserve such Securities for sale by you for our account, (ii)
purchase any such Securities to make deliveries for the Underwriters (at the
public offering price or at such price less all or part of the concession) or
(iii) reserve such Securities for sale by the Company pursuant to Delayed
Delivery Contracts. If the total of the unsold Securities does not exceed 15% of
all Securities, you may sell the unsold Securities for the Underwriters as you
determine.

If prior to the termination of this Agreement with respect to the offering of
the Securities, you shall purchase or contract to purchase any of Our Securities
sold or loaned directly by us, in your discretion you may (i) sell for our
account the Securities so purchased and debit or credit our account for the loss
or profit resulting from such sale, (ii) charge our account with an amount not
in excess of the concession to dealers with respect thereto and credit such
amount against the cost thereof or (iii) require us to purchase such Securities
at a price equal to the total cost of such purchase, including commissions,
accrued interest, amortization of original issue discount or dividends and
transfer taxes on redelivery.

7.    Arrangements for Delayed Delivery

Arrangements for Delayed Delivery Securities will be made only through you
directly, or through dealers (which may be Underwriters) to whom you may pay a
commission. Our Initial Commitment will be reduced by the Delayed Delivery
Securities attributed to us. Delayed Delivery Securities will be attributed in
the same manner and proportions as provided in Section 6 above.

The fee payable to us will be credited to our account based on the amount by
which our Initial Commitment is reduced in accordance with the above paragraph,
less the commission paid on Delayed Delivery Securities that are sold through
dealers and attributed to us. We will be treated


                                       5
<PAGE>
as only a dealer and receive only the concession with respect to the Securities,
if any, by which the aggregate of the Delayed Delivery Securities attributable
to us exceeds our Initial Commitment.

8.    Stabilization and Over-Allotment

During an Offering, and longer if necessary to cover any short position, you may
buy and sell for either long or short account in the open market or otherwise
(i) the Securities, (ii) if the Securities are common stock or a security
convertible into or exchangeable or exercisable for common stock (including any
option on common stock), the common stock of the Company and any security
convertible into or exchangeable or exercisable for common stock including any
option on such common stock (referred to as "Equivalent Securities"), and (iii)
any other securities that you may designate in the Terms Communication. In
arranging for sales of Securities, you may also over-allot and cover such
over-allotment on such terms as you deem advisable. At no time (except for
over-allotments which may be covered by an over-allotment option and except as a
result of a default by an Underwriter) shall our net commitment pursuant to this
Section exceed 20% of our Initial Commitment. All transactions pursuant to this
Section shall be made for the respective accounts of the Underwriters as nearly
as practicable in proportion to their Initial Commitments. Any securities
purchased by you for stabilizing purposes prior to our Final Acceptance will
also be subject to this Section. On demand, we will (x) pay for any Securities
purchased, deliver any Securities sold or over-allotted, or pay any losses or
expenses incurred for our account pursuant to this Section and (y) advise you of
the Securities retained by us and unsold and will sell to you for the account of
one or more of the Underwriters such of our unsold Securities at such price, not
less than the net price to selected dealers nor more than the public offering
price, as you determine.

You will notify us promptly of any transaction which in your judgment may be a
"stabilizing purchase" within the meaning of the applicable rules of the
Commission and will also notify us of the date and time when any such
stabilizing was terminated. If stabilization is effected we will provide you not
later than the fifth full business day following the termination of
stabilization, with such information and reports as are required in relation to
such stabilization pursuant to the rules and regulations of the Commission under
the Exchange Act.

9.    Open Market Transactions

Until notified by you to the contrary, we will not buy, sell, deal or trade in
Securities, any Equivalent Securities, or any other securities designated in the
Terms Communication. However, such restrictions will not apply to unsolicited
brokerage orders received in the ordinary course of business. We may, with your
prior consent, make purchases of the Securities from and sales to other
Underwriters at the public offering price, less all or any part of the
concession to dealers. We will also comply with the provisions of Regulation M
under the Exchange Act if applicable to us.

10.   Payment, Delivery and Settlement


                                       6
<PAGE>
In payment for the Securities we are obligated to purchase, we will deliver a
federal funds wire transfer to your order in accordance with your instructions
as to time and place of delivery and amount of funds. As our agent you may pay
the Company and any Seller the amount due against delivery of the Securities.
Unless we promptly provide contrary instructions, transactions may be settled
through The Depository Trust Company if we or our correspondent is a member. If
you do not receive our payment as instructed, you may make payment for our
account without relieving us of our obligations under this Agreement and, we
will repay promptly on demand the amount advanced plus interest at current
rates.

You may deliver to us from time to time against payment, for carrying purposes
only, the unsold amount of Our Securities except that if the aggregate amount of
reserved but unsold Securities upon termination in accordance with the second
paragraph of Section 13 below does not exceed 10% of the total amount of
Securities, you may in your discretion sell such Securities for the accounts of
the Underwriters, at such prices and in such manner as you determine. On demand,
we will redeliver against payment any Securities so delivered.

As soon as practicable after any Offering, the net credit or debit balance in
our account shall be paid to or collected from us; provided, however, that you
may reserve any amount for possible additional expenses chargeable to the
Underwriters. No statement by you regarding a balance in our account or the
establishment of any reserve shall constitute a representation as to the
existence or nonexistence of amounts chargeable to us. Notwithstanding any
distribution to us, we will remain liable for and pay on demand (i) any transfer
taxes paid after settlement of our account, and (ii) our proportionate share
based on our Initial Commitment of all expenses and liability incurred for the
Underwriters, including any liability based on the claim that the Underwriters
constitute an association, unincorporated business, partnership or any separate
entity. You may at any time make partial distribution of credit balances or
require partial payment of debit balances.


                                       7
<PAGE>
11.   Authority to Borrow

In carrying out this Agreement, you may arrange loans from yourself or others
for our account. In connection with any such loan, you may hold or pledge the
Securities or any other securities and execute and deliver any notes, agreements
or other instruments you deem appropriate. Any lender is authorized to accept
your instructions as Manager in all matters relating to such loans. Any
Securities or such other securities held by you for our account may be delivered
to us for carrying purposes, and if so delivered will be redelivered to you upon
demand.

12.   Expenses

All expenses incurred by you in connection with an Offering and with this
Agreement are to be charged to the Underwriters' accounts in proportion to their
respective Initial Commitments except that any transfer taxes on sales made by
you to dealers are to be charged to the Underwriter for whose account such sales
were made. Any of our funds may be held with your general funds without
interest. Your determination, apportionment and distribution of profits, losses
and expenses will be final and conclusive.

13.   Termination

This Agreement may be terminated by either party on five business days' prior
written notice except that our notice is not effective as to any Offering where
such notice is received by you after our Final Acceptance. Further, the third
paragraph of Section 10 and Sections 12, 14, 15, and 17 and your representations
hereunder will in all circumstances survive as to all Offerings.

Except as otherwise provided in the foregoing paragraph, with respect to any
Offering this Agreement will terminate at the close of business on the thirtieth
day after the Securities are released for public sale, unless you either
terminate this Agreement earlier or extend it for up to thirty additional days.

This Agreement will continue in full force and effect regardless of (i) any
termination of any Underwriting Agreement, (ii) any investigation relating to
any Securities or any Offering and (iii) the delivery of and payment for any
Securities. No termination pursuant to this Section will affect your authority
or our obligations under Sections 8 and 10. No termination will relieve any
defaulting Underwriter.


                                       8
<PAGE>
14.   Underwriters' Status

Nothing herein is to constitute any of the Underwriters a partnership,
association, unincorporated business or other separate entity or is to render
you or us liable (except as provided herein or in the Underwriting Agreement)
for any obligation of any other Underwriters; and the obligations and
liabilities of each of the Underwriters are several and not joint. In no event
will the Underwriters elect to be treated as a partnership for Federal income
tax purposes, and will not take any position inconsistent with this sentence. If
for Federal income tax purposes the Underwriters should be deemed to constitute
a partnership, then each Underwriter elects to be excluded from the application
of Subchapter K, Chapter 1, Subtitle A of the Internal Revenue Code and
authorizes UBS Securities LLC, in its discretion, on behalf of such Underwriter,
to execute such evidence of such election as may be required by the Internal
Revenue Services.

15.   Default by Underwriters

Default by one or more Underwriters hereunder or under the Underwriting
Agreement will not release the other Underwriters from their respective
obligations or affect the liability of any defaulting Underwriters to the other
Underwriters for damages resulting from such default.

16.   Indemnity and Contribution

We will indemnify, hold harmless and reimburse you and each other Underwriter
(and your respective controlling persons within the meaning of the Securities
Act or the Exchange Act) and the successors and assigns of all of the foregoing
persons to the extent and on the terms that each Underwriter agrees to indemnify
any person in the Underwriting Agreement.

If any inquiry or investigation is initiated or if any claim is asserted against
you as Manager or otherwise involves the Underwriters generally, or relates to
any Prospectus, Registration Statement, Offering Circular, the offering of the
Securities, or any transaction contemplated by this Agreement or any
Underwriting Agreement, you may make such investigation, retain such counsel and
take any other action you deem desirable, including settlement of any claim if
recommended by counsel retained by you. Upon your request, we will pay our
proportionate share of all expenses incurred by you or with your consent
(including, but not limited to, fees and disbursements of counsel) in
investigating and defending against such inquiry, investigation, claim or
otherwise, and, as contributions, our proportionate share of any related
liability incurred whether such liability results from a judgment, settlement or
otherwise. A claim against or liability incurred by a person who controls an
Underwriter within the meaning of the Securities Act or Exchange Act shall be
deemed incurred by such Underwriter. You may consent to being named as the
representative of a defendant class of Underwriters. If any Underwriter or
Underwriters default in their obligation to make any payments under Section 15,
each nondefaulting Underwriter shall be obligated to pay its proportionate share
of all defaulted payments, based upon such Underwriter's underwriting obligation
as related to the underwriting obligations of all nondefaulting Underwriters,
without relieving the defaulting Underwriter or Underwriters of liability
therefor. No person guilty of fraudulent misrepresentation (within the


                                       9
<PAGE>
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

17.   NASD

We understand that you are a member in good standing of the NASD. We represent
that (i) we are a member in good standing of the NASD and will comply with all
applicable rules of the NASD, including the NASD's Interpretation with respect
to Free Riding and Withholding and Rule 2740 of the Conduct Rules, or (ii) we
are a foreign bank, broker, dealer or other institutions not eligible for such
membership and will not make sales within the United States, its territories or
possessions or to persons who are citizens or residents thereof except through
you (except that we may participate in group sales pursuant to Section 6 above)
and that in making sales outside the United States, we will comply with the
requirements of the NASD's Interpretation with respect to Free Riding and
Withholding and comply as though a member with Rules 2420, 2730, 2740 and 2750
of the Conduct Rules of the NASD.

18.   Miscellaneous

This Agreement and any claim, counterclaim or dispute of any kind or nature
whatsoever arising out of or in any way relating to this Agreement ("Claim"),
directly or indirectly, shall be governed by, and construed in accordance with,
the laws of the State of New York without regard to the conflicts of law
provisions thereof. Except as set forth below, no Claim may be commenced,
prosecuted or continued in any court other than the courts of the State of New
York located in the City and County of New York or in the United States District
Court for the Southern District of New York, which courts shall have
jurisdiction over the adjudication of such matters, and we and you consent to
the jurisdiction of such courts and personal service with respect thereto. We
and you waive all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. We agree that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon us and may be enforced in any other courts to the jurisdiction
of which we are, or may be subject, by suit upon such judgment. The Section
headings in this Agreement have been inserted as a matter of convenience of
reference and are not a part of this Agreement. This Agreement may be
supplemented or amended by you by written notice to us and, except for
supplements or amendments set forth in a Terms Communication, any such
supplement or amendment to this Agreement shall be effective with respect to any
Offering to which this Agreement applies after the date of such supplement or
amendment. Each reference to "Agreement" herein shall, as appropriate, be to
this Agreement as so amended and supplemented. This Agreement may be signed by
the parties in one or more counterparts which together shall constitute one and
the same agreement among the parties.

19.   Notices


                                       10
<PAGE>
Any notice hereunder is duly given if sent from you by registered mail, telegram
or telex, to us as set forth below or if sent to you at UBS Securities LLC, 299
Park Avenue, New York, New York 10171-0026, Attention: Corporate Syndicate
Department.

Very truly yours,

__________________________________
(Name of Firm)

__________________________________
(Address of Firm)

__________________________________
(Name and Title of Signatory)

By:____________________________

(Signature)

Facsimile No.:____________


                                       11
<PAGE>
Confirmed as of the date first above written.

UBS Securities LLC

By: ______________________________

Executive Director

UBS Securities LLC

By: ______________________________

Managing Director


                                       12
<PAGE>
FORM OF INVITATION TO BE USED WITH MASTER AGREEMENT AMONG UNDERWRITERS

(The following form of Invitation, adapted as appropriate for debt securities,
convertible securities, stock or units, is designed for use in all offerings to
which UBS Securities LLC Master Agreement Among Underwriters (the "Master AAU")
will apply. In certain cases, all or a part of the following form will be
combined with the form of Terms Wire.)

(Date)

(Name and address of prospective Underwriter)

Attention:        Corporate Syndicate Department

                  Invitation Wire

(Name of Issuer)

(Title of Securities) (principal amount or number shares)

(Name of Guarantor, if any)

Registration form or application filed with (name of regulatory authority)

Seller(s): (Insert if other than or in addition to Company)

The anticipated terms are as follows:

--------------------------------------------------------------------------------

<TABLE>
<S>                                                   <C>
Call Protection:                                      (insert if applicable)
Sinking Fund:                                         (insert if applicable)  Starts in        and
                                                      retires $     per annum through
Optional Redemption Schedule:                         Redeemable at     %, beginning      declining
                                                      (straight-line) to 100%, beginning
Over-allotment Option:                                (insert amount, if applicable)
Ratings:                                              (expected-confirmed)
Listing:                                              (insert if applicable) Application has been
                                                      made to list (insert name(s) of exchange(s))
Delayed Delivery:                                     (insert if applicable)
Name of Trustee:                                      (insert if applicable)
Name of Parent of Trustee:                            (insert if applicable)
Name of Parent of Company:                            (insert if applicable)
Equivalent Securities and other securities subject
to stabilization pursuant to Section 8 of Master
AAU and restricted pursuant to Section 9 of Master
AAU:
                                                      (insert if applicable)

Other terms of the Offering or the Securities:        (insert if applicable)
</TABLE>


                                       13
<PAGE>
[The issuer is not subject to the requirements of Section 13(a) or 15(d) of the
Securities Exchange Act of 1934. We call your attention to the final paragraph
of Section 3(a) of our Master Agreement Among Underwriters and advise you that,
without our consent, Securities should not be sold to an account over which you
have investment discretion.] (insert if applicable)

You are hereby invited to participate as one of the several Underwriters in the
above-referenced Offering for (amount). Your participation as an Underwriter
shall be subject to the provisions of the Master Agreement Among Underwriters
between you and UBS Securities LLC, as amended.

If you wish to accept this Invitation and thereby agree to its terms, the
Corporate Syndicate Department of UBS Securities LLC : must receive a telegram,
telex or Graphic Scanning communication from you not later than _____________
M., New York City time, on ____________, ___, in substantially the following
form:

"We accept the Invitation dated _____________, ____, to participate as an
Underwriter in the Offering of Securities of (insert name of issuer). We confirm
that we agree to be bound by the Master Agreement Among Underwriters as it
relates to this Offering and that there are no exceptions to your Master
Underwriters' Questionnaire (or state exceptions)."

(Signature of firm)

UBS Securities LLC

[Name of Co-Manager(s), if any]


FORM OF TERMS WIRE TO BE USED WITH UBS SECURITIES LLC MASTER AGREEMENT AMONG
UNDERWRITERS

(The following form, adapted as appropriate for debt securities, convertible
securities, stock or units, will be used in connection with offerings to which
the UBS Securities LLC Master Agreement Among Underwriters will apply. In
certain cases all or part of the following form will be combined with the form
of Invitation.)


                                       14
<PAGE>
(Date)

(Name and address of prospective Underwriter)

Attention:        Corporate Syndicate Department
                  Terms Wire

(Name of Issuer)

(Title of Securities) (principal amount or number of shares)

(Name of Guarantor, if any)

Your underwriting commitment shall be ____________________

<TABLE>
<S>                                                       <C>
Coupon [dividend rate]                                    (insert if applicable)
Initial offering price[s] (1)                             (or specify formula pricing is being used)
Yield to Maturity:
Conversion price and other terms:                         (insert if applicable)
Expected Offering Date:
Expected Closing Date:
Delivery of Securities:
Type of Funds:
Gross spread:                                             (unless formula pricing is being used)
Management fee:                                           (or maximum amount thereof)
Underwriting:                                             (unless formula pricing is being used)
Selling concession:                                       (unless formula pricing is being used)
Reallowance:                                              (unless formula pricing is being used)
Other terms of the Offering or the Securities:            (insert if applicable)
</TABLE>

NOTE: Plus accrued interest/dividends from (insert date for fixed income
      securities).

Unless a telex from you revoking your previous Acceptance of our Invitation with
respect to this offering is received by the UBS Securities LLC Corporate
Syndicate Department, prior to New York City time on ___________, your
Acceptance will become final and our Master Agreement Among Underwriters will
become effective as to you with respect to this Offering.

UBS Securities LLC

[Name of Co-Manager(s), if any]

By: UBS Securities LLC


                                       15
<PAGE>
UBS Securities LLC

MASTER UNDERWRITERS' QUESTIONNAIRE

Unless otherwise defined herein, capitalized terms used herein shall have the
meaning assigned thereto in the Master Agreement Among Underwriters between UBS
Securities LLC and us (such agreement as amended or supplemented from time to
time being hereinafter referred to as the "Agreement"). Reference will be made
to this Master Underwriters' Questionnaire in the Terms Communication described
in Section 1 of the Agreement received by us in connection with the offerings
of securities in which UBS Securities LLC is acting as manager of the several
underwriters. Our acceptance of any Terms Communication should respond to this
Master Underwriters' Questionnaire, and state that there are "no exceptions" or,
if there are exceptions, provide details thereof. We authorize you to furnish
such information and make such representations to appropriate authorities based
on the information provided by us pursuant to this Questionnaire.

In connection with the Offering, we advise you and the Company that, except as
indicated in our acceptance of the Terms Communication:

neither we nor any of our directors, officers or partners has, nor have we or
they had within the last three years, a "material" relationship (as the term
"material" is defined in Regulation C promulgated under the Securities Act) with
the Company, its parent, if any, any Seller or Guarantor;

neither we nor any of our officers, directors or partners, separately or as a
"group" (as that term is used in Section 13(d)(3) of the Exchange Act), owns of
record or beneficially (determined in accordance with Rule 13d-3 under the
Exchange Act) more than 5% of any class of voting securities of the Company, its
parent or any Seller or Guarantor or is affiliated (as that term is defined in
the Rules and Regulations under the Exchange Act) with any person who owns of
record or beneficially more than 5% of any such class of securities or has
knowledge that more than 5% of any such class is or is to be held subject to any
voting trust or similar arrangement;

other than as may be stated in the Agreement, the Terms Communication or the
Underwriting Agreement relating to the proposed offering or the UBS Securities
LLC Master Dealer Agreement, we do not know of, or have any reason to believe
that there are, any arrangements (i) for any discounts or commissions to be
allowed or paid to underwriters or any other items that would be deemed by the
NASD to constitute underwriting compensation for purposes of Rule 2710 of the
NASD's Conduct Rules; (ii) for any discounts or commissions to be allowed or
paid to dealers or any cash, securities, contracts or other consideration to
be received by any dealer in connection with the sale of the Securities; (iii)
for limiting or restricting the sale of any securities of the Company or the
Guarantor for the period of distribution; (iv) for stabilizing the market for
any securities of the Company or the Guarantor; or (v) for withholding
commissions or otherwise holding each underwriter or dealer responsible for
the distribution of his participation;


                                       16
<PAGE>
neither we nor any of our directors, officers, partners or "persons associated
with" us (as defined in the By-laws of the NASD) within the last 12 months have
purchased (or intends within six months after the commencement of the offering
of the Securities to purchase) in private transactions any securities of the
Company or the Guarantor or any parent or subsidiary thereof or have had any
dealings with the Company or the Guarantor or any parent or controlling
stockholder thereof (other than relating to the proposed Underwriting
Agreement), as to which documents or information are required to be filed with
the NASD pursuant to its Conduct Rules;

no report or memorandum has been prepared by or for us for external use in
connection with the Offering, and if the Registration Statement is on Form S-1,
no engineering, management or similar report or memorandum relating to broad
aspects of the business, operations or products of the Company, the Guarantor or
any parent thereof has been prepared for or by you within the past twelve months
(except for reports solely comprised of recommendations to buy, sell or hold the
securities of the Company, the Guarantor or any parent thereof, unless such
recommendations have changed within the last six months).

If the Securities are to be issued under an Indenture qualified under the Trust
Indenture Act of 1939:

we (if a corporation) do not have outstanding nor have we assumed or guaranteed
any securities issued otherwise than in our present corporate name and neither
the Trustee nor its parent is a holder of any of our securities;

neither we nor any of our directors, officers or partners is an "affiliate," as
defined in Rule 0-2 under the Trust Indenture Act of 1939, of the Trustee or its
parent, and neither the Trustee nor its parent, nor any of their directors or
executive officers is a director, officer, partner, employee, appointee or
representative of us as those terms are defined in said Act or in the relevant
instructions to the Trustee's Statement of Eligibility and Qualification on Form
T-1; and

      In the event of an exception to the type of materials referred to, three
      complies of each item of such material, together with a statement
      describing the actual or proposed use, the distribution thereof, and
      identifying the classes of recipients, the number of copies of such
      materials distributed to each such class and the period of distribution
      must be sent to UBS Securities LLC, 299 Park Avenue, New York, New York
      10171-0026, Attention: Corporate Syndicate Department.

neither we nor any of our directors, executive officers, partners or parents,
separately or as a group, owns beneficially 1% or more of any class of voting
securities of the Trustee or its parent; and

if the issuer is a public utility, we are not a "holding company" or a
"subsidiary company" or an "affiliate" of a "holding company" or of a "public
utility company," each as defined in the Public Utility Holding Company Act of
1935.


                                       17


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(H)(3)
<SEQUENCE>8
<FILENAME>b52674a1exv99wxhyx3y.txt
<DESCRIPTION>EX-99.(H)(3) FORM OF MASTER SELECTED DEALERS AGREEMENT
<TEXT>
<PAGE>
                                                                  Exhibit (h)(3)

                        MASTER SELECTED DEALERS AGREEMENT

                                             , 2004

UBS Securities LLC
299 Park Avenue
New York, New York  10171

Gentlemen:

      1. General. We understand that UBS Securities LLC ("UBS Securities") is
entering into this Agreement with us and other firms who may be offered the
right to purchase as principal a portion of securities being distributed to the
public. The terms and conditions of this Agreement shall be applicable to any
public offering of securities ("Securities") wherein UBS Securities (acting for
its own account or for the account of any underwriting or similar group or
syndicate) is responsible for managing or other wise implementing the sale of
the Securities to selected dealers ("Selected Dealers") and has expressly
informed us that such terms and conditions shall be applicable. Any such
offering of Securities to us as a Selected Dealer is hereinafter called an
"Offering." In the case of any Offering in which you are acting for the account
of any underwriting or similar group or syndicate ("Underwriters"), the terms
and conditions of this Agreement shall be for the benefit of, and binding upon
such Underwriters, including, in the case of any Offering in which you are
acting with others as representatives of Underwriters, such other
representatives. The term "preliminary prospectus" means, in the case of an
Offering registered under the Securities Act of 1933 (the "Securities Act"),
any preliminary prospectus relating to an Offering of Securities or any
preliminary prospectus supplement together with a prospectus relating to an
Offering of Securities and, in the case of an Offering not registered under the
Securities Act, any preliminary offering circular relating to an Offering of
Securities or any preliminary offering circular supplement together with an
offering circular relating to an Offering of Securities; the term "Prospectus"
means, in the case of an Offering registered under the Securities Act of 1933
(the "Securities Act"), the prospectus, together with the final prospectus
supplement, if any, relating to such Offering of Securities, filed pursuant to
Rule 424(b) or Rule 424(c) under the Securities Act and, in the case of an
Offering not registered under the Securities Act, the final offering circular,
including any supplements, relating to such Offering of Securities.


<PAGE>





      2. Conditions of Offering; Acceptance and Purchase. Any Offering will be
subject to delivery of the Securities and their acceptance by you and any other
Underwriters, may be subject to the approval of all legal matters by counsel and
the satisfaction of other conditions, and may be made on the basis of
reservation of Securities or an allotment against subscription. You will advise
us by telegram, telex or other form of writ ten communication ("Written
Communication") of the particular method and supplementary terms and conditions
(including, without limitation, the information as to prices and offering date
referred to in Section 3(b)) of any Offering in which we are invited to
participate. To the extent such supplementary terms and conditions are
inconsistent with any provision herein, such terms and conditions shall
supersede any such provision. Unless otherwise indicated in any such Written
Communication, acceptances and other communications by us with respect to any
Offering should be sent to UBS Securities LLC, 299 Park Avenue, New York, New
York 10171. You reserve the right to reject any acceptance in whole or in part.
Payment for Securities purchased by us is to be made at such office as you may
designate, at the public offering price, or, if you shall so advise us, at such
price less the concession to dealers or at the price set forth or indicated in a
Written Communication, on such date as you shall determine, on one day's prior
notice to us, by certified or official bank check in New York Clearing House
funds payable to the order of PaineWebber Incorporated, against delivery of
certificates evidencing such Securities. If payment is made for Securities
purchased by us at the public offering price, the concession to which we shall
be entitled will be paid to us upon termination of the provisions of Section
3(b) with respect to such Securities.

      Unless we promptly give you written instructions otherwise, if
transactions in the Securities may be settled through the facilities of The
Depository Trust Company, payment for and delivery of Securities purchased by us
will be made through such facilities if we are a member, or if we are not a
member, settlement may be made through our ordinary correspondent who is a
member.

      3. Representations, Warranties and Agreements. (a) Prospectuses. You shall
provide us with such number of copies of each preliminary prospectus, the
Prospectus and any supplement thereto relating to each Offering as we may
reasonably request. If the Securities will be registered under the Securities
Act, we represent that we are familiar with Rule 15c2-8 under the Exchange Act
relating to the distribution of preliminary and final prospectuses and agree
that we will comply therewith; we agree to keep an accurate record of our
distribution (including dates, number of copies and persons to whom sent) of
copies of the Prospectus or any preliminary prospectus (or any amendment or
supplement to any thereof), and

<PAGE>

promptly upon request by you, to bring all subsequent changes to the attention
of anyone to whom such material shall have been furnished, and we agree to
furnish to persons who receive a confirmation of sale a copy of the Prospectus
filed pursuant to Rule 424(b) or Rule 424(c) under the Securities Act. If the
Securities will not be registered under the Securities Act, we agree that we
will deliver all preliminary and final offering circulars required for
compliance with the applicable laws and regulations governing the use and
distribution of offering circulars by underwriters, and, to the extent
consistent with such laws and regulations, we confirm that we have delivered and
agree that we will deliver all preliminary and final offering circulars which
would be required if the provisions of Rule 15c2-8 under the Exchange Act
applied to this offering. We agree that in purchasing Securities in an Offering
we will rely upon no statements whatsoever, written or oral, other than the
statements in the Prospectus delivered to us by you. We will not be authorized
by the issuer or other seller of Securities offered pursuant to a Prospectus or
by any Underwriters to give any information or to make any representation not
contained in the Prospectus in connection with the sale of such Securities.

      (b) Offer and Sale to the Public. With respect to any Offering of
Securities, you will inform us by a Written Communication of the public offering
price, the selling concession, the relaunch (if any) to dealers and the time
when we may commence selling Securities to the public. After such public
offering has commenced, you may change the public offering price, the selling
concession and the relaunch to dealers. With respect to each Offering of
Securities, until the provisions of this Section 3(b) shall be terminated
pursuant to Section 4, we agree to offer Securities to the public only at the
public offering price, except that if a relaunch is in effect, a relaunch from
the public offering price not in excess of such relaunch may be allowed as
consideration for services rendered in distribution to dealers who are actually
engaged in the investment banking or securities business, who execute the
written agreement prescribed by Section 24(c) of Article III of the Rules of
Fair Practice of the National Association of Securities Dealers, Inc. (the
"NASD"), and who are either members in good standing of the NASD or foreign
brokers or dealers not eligible for membership in the NASD who represent to us
that they will promptly rafter such Securities at the public offering price and
will abide by the conditions with respect to foreign brokers and dealers set
forth in Section 3(e).

      (c) Stabilization and Over-Allotment. You may, with respect to any
Offering, be authorized to over-allot in arranging sales to Selected Dealers, to
purchase and sell Securities, any other securities of the issuer of the
Securities of the same class and series and any other securities of such issuer
that you may designate for long or short account and to stabilize or maintain
the market price of the

                                       3
<PAGE>

Securities. We agree to advise you from time to time upon request, prior to the
termination of the provisions of Section 3(b) with respect to any Offering, of
the amount of Securities purchased by us hereunder remaining unsold and we will,
upon your request, sell to you, for the accounts of the Underwriters, such
amount of Securities as you may designate, at the public offering price thereof
less an amount to be deter mined by you not in excess of the concession to
dealers. In the event that prior to the later of (i) the termination of the
provisions of Section 3(b) with respect to any Offering, or (ii) the covering by
you of any short position created by you in connection with such Offering for
your account or the account of one or more Underwriters, you purchase or
contract to purchase for the account of any of the Underwriters, in the open
market or other wise, any Securities theretofore delivered to us, you reserve
the right to withhold the above-mentioned concession to dealers on such
Securities if sold to us at the public offering price, or if such concession has
been allowed to us through our purchase at a net price, we agree to repay such
concession upon your demand, plus in each case any taxes on redeliver,
commissions, accrued interest and dividends paid in connection with such
purchase or contract to purchase.

      (d) Open Market Transactions. We agree not to bid for, purchase, attempt
to purchase, or sell, directly or indirectly, any Securities, any other
securities of the issuer of the Securities of the same class and series or any
other securities of such issuer as you may designate, except as brokers pursuant
to unsolicited orders and as otherwise provided in this Agreement. If the
Securities are common stock or securities convertible into common stock, we
agree not to effect, or attempt to induce others to effect, directly or
indirectly, any transactions in or relating to put or call options on any stock
of such issuer, except to the extent permitted by Rule 10b-6 under the Exchange
Act as interpreted by the Securities and Exchange Commission. An opening
uncovered writing transaction in options to acquire Securities for our account
or for the account of any customer shall be deemed, for purposes of the
preceding sentence, to be a transaction effected by us in or relating to put or
call options on stock of the Company not permitted by Rule 10b-6. The term
"opening uncovered writing transaction" means an opening sale transaction where
the seller in tends to become a writer of an option to purchase stock which it
does not own or have the right to acquire upon exercise of conversion or option
rights.

      (e) NASD. We represent that we are actually engaged in the investment
banking or securities business and we are either a member in good standing of
the NASD, or, if not such a member, a foreign dealer not eligible for
membership. If we are such a member we agreed that in making sales of the
Securities we will comply with all applicable rules of the NASD, including,
without limitation, the NASD's

                                       4
<PAGE>

Interpretation with Respect to Free-Riding and Withholding and Section 24 of
Article III of the Rules of Fair Practice. If we are such a foreign dealer, we
agree not to offer or sell any Securities in the United States of America except
through you and in making sales of Securities outside the United States of
America, we agree to comply, as though we were a member with such Interpretation
and Sections 8, 24 and 36 of Article III of the NASD's Rules of Fair Practice
and to comply with Section 23 of such Article III as it applies to a nonmember
broker or dealer in a foreign country.

      (f) Relationship among Underwriters and Selected Dealers. You may buy
Securities from or sell Securities to any Underwriter or Selected Dealer and,
with your consent, the Underwriters (if any) and the Selected Dealers may
purchase Securities from and sell Securities to each other at the public
offering price less all or any part of the concession. We are not authorized to
act as agent for you or any Underwriter or the issuer or other seller of any
Securities in offering Securities to the public or otherwise. Nothing contained
herein or in any Written Communication from you shall constitute the Selected
Dealers partners with you or any Underwriter or with one another. Neither you
nor any Underwriter shall be under any obligation to us except for obligations
assumed hereby or in any Written Communication from you in connection with any
Offering. In connection with any Offering, we agree to pay our proportionate
share of any claim, demand or liability asserted against us, and the other
Selected Dealers or any of them, or against you or the Underwriters, if any,
based on any claim that such Selected Dealers or any of them constitute an
association, unincorporated business or other separate entity, including in each
case our proportionate share of any expense incurred in defending against any
such claim, demand or liability.

      (g) Blue Sky Laws. Upon application to you, you will inform us as to the
jurisdictions in which you believe the Securities have been qualified for sale
under the respective securities of "blue sky" laws of such jurisdictions. We
understand and agree that compliance with the securities or "blue sky" laws in
each jurisdiction in which we shall offer or sell any of the Securities shall be
our sole responsibility and that you assume no responsibility or obligations as
to the eligibility of the Securities for sale or our right to sell the
Securities in any jurisdiction.

      (h) Compliance with Law. We agree that in selling Securities pursuant to
any Offering (which agreement shall also be for the benefit of the issuer or
other seller of such Securities) we will comply with the applicable provisions
of the Securities Act and the Exchange Act, the applicable rules and regulations
of the Securities and Exchange Commission thereunder, the applicable rules and


                                       5
<PAGE>

regulations of the NASD and the applicable rules and regulations of any
securities exchange having jurisdiction over the Offering. You shall have full
authority to take such action as you may deem advisable in respect of all
matters pertaining to any Offering. Neither you nor any Underwriter shall be
under any liability to us, except for lack of good faith and for obligations
expressly assumed by you in this Agreement; provided, however, that nothing in
this sentence shall be deemed to relieve you from any liability imposed by the
Securities Act.

      4. Termination; Supplements and Amendments. This agreement may be
terminated by either party herein upon five business days' written notice to the
other party; provided that with respect to any Offering for which a Written
Communication was sent and accepted prior to such notice, this Agreement as it
applies to such Offering shall remain in full force and effect and shall
terminate with respect to such Offering in accordance with the last sentence of
this Section. This Agreement may be supplemented or amended by you by written
notice thereof to us, and any such supplement or amendment to this Agreement
shall be effective with respect to any Offering to which this Agreement applies
after the date of such supplement or amendment. Each reference to "this
Agreement" herein shall, as appropriate, be to this Agreement as so amended and
supplemented. The terms and conditions set forth in Sections 3(b) and (d) with
regard to any Offering will terminate at the close of business on the thirtieth
day after the date of the initial public offering of the Securities to which
such Offering relates, but such terms and conditions, upon notice to us, may be
terminated by you at any time.

      5. Successors and Assigns. This Agreement shall be binding on, and inure
to the benefit of, the parties hereto and other persons specified or indicated
in Section 1, and the respective successors and assigns of each of them.

      6. Governing Law. This Agreement and the terms and conditions set forth
herein with respect to any Offering together with such supplementary terms and
conditions with respect to such Offering as may be contained in any Written
Communication from you to us in connection therewith shall be governed by, and
construed in accordance with, the laws of the State of New York.

         By signing this Agreement we confirm that our subscription to, or our
acceptance of any reservation of, any Securities pursuant to an Offering shall
constitute (i) acceptance of and agreement to other terms and conditions of this
Agreement (as supplemented and amended pursuant to Section 4) together with the
subject to any supplementary terms and conditions contained in any Written
Communication from you in connection with such Offering, all of which shall


                                       6
<PAGE>

constitute a binding agreement between us and you, individually or as
representative of any Underwriters, (ii) confirmation that our representations
and warranties set forth in Section 3 are true and correct at that time and
(iii) confirmation that our agreements set forth in Sections 2 and 3 have been
and will be fully performed by us to the extent and at the times required
thereby.

                                    Very truly yours,



                                    ---------------------------
                                    (Name of Firm)

                                    By_________________________
                                    Title______________________


Confirmed, as of the date
first above written.

UBS Securities LLC

By_______________________
Title:


                                       7

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(J)(1)
<SEQUENCE>9
<FILENAME>b52674a1exv99wxjyx1y.txt
<DESCRIPTION>EX-99.(J)(1) MASTER CUSTODIAN AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (j)(1)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II




                                                December 20, 2004



Eaton Vance Enhanced  Equity Income Fund II hereby adopts and agrees to become a
party to the attached Custodian Agreement as amended and extended with Investors
Bank & Trust Company.


                                      EATON VANCE ENHANCED EQUITY INCOME FUND II


                                      By:  /s/ Duncan W. Richardson
                                           ------------------------------------
                                           Duncan W. Richardson
                                           President, and not Individually



Accepted and agreed to:

INVESTORS BANK & TRUST COMPANY


By:  /s/ Andrew M. Nesvet
     ----------------------------------
     Andrew M. Nesvet
     Managing Director

<PAGE>







                           MASTER CUSTODIAN AGREEMENT

                                     between

                           EATON VANCE GROUP OF FUNDS

                                       and

                         INVESTORS BANK & TRUST COMPANY

                                TABLE OF CONTENTS



1.   Definitions............................................................1-2

2.   Employment of Custodian and Property to be held by it..................2-3

3.   Duties of the Custodian with Respect to Property of the Fund.............3

     A.  Safekeeping and Holding of Property..................................3
     B.  Delivery of Securities.............................................3-6
     C.  Registration of Securities...........................................6
     D.  Bank Accounts........................................................6
     E.  Payments for Shares of the Fund....................................6-7
     F.  Investment and Availability of Federal Funds.........................7
     G.  Collections........................................................7-8
     H.  Payment of Fund Moneys.............................................8-9
     I.  Liability for Payment in Advance of Receipt of
         Securities Purchased.................................................9
     J.  Payments for Repurchases of Redemptions of Shares
         of the Fund.......................................................9-10
     K.  Appointment of Agents by the Custodian..............................10
     L.  Deposit of Fund Portfolio Securities in Securities Systems.......10-12
     M.  Deposit of Fund Commercial Paper in an Approved Book-Entry
           System for Commercial Paper....................................12-13
     N.  Segregated Account..................................................14
     O.  Ownership Certificates for Tax Purposes.............................14
     P.  Proxies.............................................................14
     Q.  Communications Relating to Fund Portfolio Securities................14
     R.  Exercise of Rights;  Tender Offers..................................15


                                       -i-
<PAGE>
     S.  Depository Receipts.................................................15
     T.  Interest Bearing Call or Time Deposits...........................15-16
     U.  Options, Futures Contracts and Foreign Currency Transactions.....16-17
     V.  Actions Permitted Without Express Authority.........................17
     W.  Advances by the Bank................................................18

 4.  Duties of Bank with Respect to Books of Account and Calucations
     of Net Asset Value......................................................18

 5.  Records and Miscellaneous Duties.....................................18-19

 6.  Opinion of Fund's Independent Public Accountants........................19

 7.  Compensation and Expenses of Bank.......................................19

 8.  Responsibility of Bank...............................................19-20

 9.  Persons Having Access to Assets of the Fund.............................20

10.  Effective Period, Termination and Amendment; Successor Custodian.....20-21

11.  Interpretive and Additional Provisions..................................21

12.  Notices.................................................................21

13.  Massachusetts Law to Apply..............................................22

14.  Adoption of the Agreement by the Fund...................................22


                                      -ii-
<PAGE>
                           MASTER CUSTODIAN AGREEMENT

     This  Agreement is made between each  investment  company  advised by Eaton
Vance  Management which has adopted this Agreement in the manner provided herein
and Investors Bank & Trust Company  (hereinafter called "Bank",  "Custodian" and
"Agent"),  a trust company  established  under the laws of Massachusetts  with a
principal place of business in Boston, Massachusetts.

     Whereas,  each such investment  company is registered  under the Investment
Company  Act of 1940  and has  appointed  the  Bank to act as  Custodian  of its
property and to perform certain duties as its Agent,  as more fully  hereinafter
set forth; and

     Whereas,  the  Bank is  willing  and  able to act as each  such  investment
company's Custodian and Agent,  subject to and in accordance with the provisions
hereof;

     Now,  therefore,  in  consideration  of the  premises  and  of  the  mutual
covenants and agreements herein contained,  each such investment company and the
Bank agree as follows:

1. DEFINITIONS

     Whenever used in this Agreement,  the following  words and phrases,  unless
the context otherwise requires, shall have the following meanings:

     (a)  "Fund"  shall  mean the  investment  company  which has  adopted  this
Agreement.  If the Fund is a Massachusetts  business trust, it may in the future
establish and designate  other separate and distinct  series of shares,  each of
which may be called a  "portfolio";  in such case,  the term  "Fund"  shall also
refer to each such separate series or portfolio.

     (b)  "Board"  shall mean the board of  directors/trustees/managing  general
partners/director general partners of the Fund, as the case may be.

     (c) "The Depository Trust Company",  a clearing agency  registered with the
Securities and Exchange  Commission under Section 17A of the Securities Exchange
Act  of  1934  which  acts  as  a  securities  depository  and  which  has  been
specifically approved as a securities depository for the Fund by the Board.

     (d)  "Participants  Trust Company",  a clearing agency  registered with the
Securities and Exchange  Commission under Section 17A of the Securities Exchange
Act  of  1934  which  acts  as  a  securities  depository  and  which  has  been
specifically approved as a securities depository for the Fund by the Board.

     (e)  "Approved  Clearing  Agency"  shall mean any other  domestic  clearing
agency registered with the Securities and Exchange  Commission under Section 17A
of the Securities Exchange Act of 1934 which acts as a securities depository BUT
ONLY if the  Custodian  has  received  a  certified  copy of a vote of the Board
approving such clearing agency as a securities depository for the Fund.

     (f) "Federal  Book-Entry  System" shall mean the book-entry system referred
to in Rule 17f-4(b) under the  Investment  Company Act of 1940 for United States
and  federal  agency  securities  (i.e.,  as  provided  in Subpart O of Treasury
Circular No. 300, 31 CFR 306,  Subpart B of 31 CFR Part 350, and the  book-entry
regulations of federal agencies substantially in the form of Subpart O).
<PAGE>
     (g)  "Approved  Foreign   Securities   Depository"  shall  mean  a  foreign
securities  depository  or clearing  agency  referred to in Rule 17f-4 under the
Investment  Company Act of 1940 for foreign securities BUT ONLY if the Custodian
has received a certified copy of a vote of the Board  approving such  depository
or clearing agency as a foreign securities depository for the Fund.

     (h) "Approved  Book-Entry  System for Commercial Paper" shall mean a system
maintained by the Custodian or by a subcustodian  employed pursuant to Section 2
hereof for the holding of commercial  paper in  book-entry  form BUT ONLY if the
Custodian  has received a certified  copy of a vote of the Board  approving  the
participation by the Fund in such system.

     (i) The Custodian shall be deemed to have received "proper instructions" in
respect of any of the matters  referred  to in this  Agreement  upon  receipt of
written or facsimile  instructions  signed by such one or more person or persons
as the Board  shall  have from time to time  authorized  to give the  particular
class of instructions in question.  Electronic instructions for the purchase and
sale of  securities  which are  transmitted  by Eaton  Vance  Management  to the
Custodian  through the Eaton  Vance  equity  trading  system and the Eaton Vance
fixed income trading system shall be deemed to be proper instructions;  the Fund
shall cause all such instructions to be confirmed in writing.  Different persons
may be authorized to give instructions for different purposes.  A certified copy
of a vote  of the  Board  may be  received  and  accepted  by the  Custodian  as
conclusive  evidence  of the  authority  of any  such  person  to act and may be
considered  as in full force and effect until  receipt of written  notice to the
contrary.  Such  instructions  may be general or  specific  in terms and,  where
appropriate, may be standing instructions.  Unless the vote delegating authority
to any person or persons to give a particular class of instructions specifically
requires that the approval of any person,  persons or committee shall first have
been obtained before the Custodian may act on  instructions  of that class,  the
Custodian  shall be under no  obligation  to question the right of the person or
persons  giving  such  instructions  in so  doing.  Oral  instructions  will  be
considered proper instructions if the Custodian reasonably believes them to have
been given by a person  authorized to give such instructions with respect to the
transaction involved. The Fund shall cause all oral instructions to be confirmed
in  writing.  The Fund  authorizes  the  Custodian  to tape  record  any and all
telephonic or other oral instructions given to the Custodian.  Upon receipt of a
certificate  signed by two officers of the Fund as to the  authorization  by the
President and the Treasurer of the Fund accompanied by a detailed description of
the communication  procedures approved by the President and the Treasurer of the
Fund, "proper  instructions" may also include  communications  effected directly
between  electromechanical or electronic devices provided that the President and
Treasurer  of the Fund and the  Custodian  are  satisfied  that such  procedures
afford  adequate  safeguards  for the Fund's  assets.  In performing  its duties
generally,  and more  particularly  in connection  with the  purchase,  sale and
exchange  of  securities  made  by or for  the  Fund,  the  Custodian  may  take
cognizance  of  the  provisions  of the  governing  documents  and  registration
statement of the Fund as the same may from time to time be in effect (and votes,
resolutions or proceedings of the shareholders or the Board), but, nevertheless,
except as otherwise  expressly  provided herein, the Custodian may assume unless
and until notified in writing to the contrary that so-called proper instructions
received by it are not in conflict with or in any way contrary to any provisions
of such governing documents and registration statement, or votes, resolutions or
proceedings of the shareholders or the Board.

2. EMPLOYMENT OF CUSTODIAN AND PROPERTY TO BE HELD BY IT

     The Fund hereby appoints and employs the Bank as its Custodian and Agent in
accordance  with and  subject  to the  provisions  hereof,  and the Bank  hereby
accepts  such  appointment  and  employment.  The Fund  agrees to deliver to the
Custodian all securities,  participation interests,  cash and other assets owned

                                      -2-
<PAGE>
by  it,  and  all  payments  of  income,   payments  of  principal  and  capital
distributions and adjustments  received by it with respect to all securities and
participation  interests  owned by the  Fund  from  time to  time,  and the cash
consideration  received by it for such new or treasury shares  ("Shares") of the
Fund as may be  issued or sold from  time to time.  The  Custodian  shall not be
responsible  for any property of the Fund held by the Fund and not  delivered by
the Fund to the  Custodian.  The Fund will also deliver to the Bank from time to
time  copies of its  currently  effective  charter (or  declaration  of trust or
partnership agreement,  as the case may be), by-laws,  prospectus,  statement of
additional   information   and   distribution   agreement   with  its  principal
underwriter,  together with such resolutions, votes and other proceedings of the
Fund as may be necessary for or convenient to the Bank in the performance of its
duties hereunder.

     The  Custodian  may from time to time employ one or more  subcustodians  to
perform  such acts and  services  upon such  terms  and  conditions  as shall be
approved from time to time by the Board of Directors.  Any such  subcustodian so
employed by the Custodian shall be deemed to be the agent of the Custodian,  and
the  Custodian   shall  remain   primarily   responsible   for  the  securities,
participation  interests,  moneys  and other  property  of the Fund held by such
subcustodian. Any foreign subcustodian shall be a bank or trust company which is
an  eligible  foreign  custodian  within the  meaning  of Rule  17f-5  under the
Investment  Company Act of 1940, and the foreign custody  arrangements  shall be
approved by the Board of Directors and shall be in  accordance  with and subject
to the provisions of said Rule. For the purposes of this Agreement, any property
of the Fund held by any such subcustodian  (domestic or foreign) shall be deemed
to be held by the Custodian under the terms of this Agreement.

3. DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE FUND

     A.   FEKEEPING AND HOLDING OF PROPERTY. The Custodian shall keep safely all
          property of the Fund and on behalf of the Fund shall from time to time
          receive delivery of Fund property for safekeeping. The Custodian shall
          hold,  earmark and  segregate on its books and records for the account
          of the  Fund all  property  of the  Fund,  including  all  securities,
          participation  interests  and other assets of the Fund (1)  physically
          held by the  Custodian,  (2) held by any  subcustodian  referred to in
          Section 2 hereof or by any agent  referred  to in  Paragraph K hereof,
          (3)  held by or  maintained  in The  Depository  Trust  Company  or in
          Participants Trust Company or in an Approved Clearing Agency or in the
          Federal  Book-Entry  System  or  in  an  Approved  Foreign  Securities
          Depository, each of which from time to time is referred to herein as a
          "Securities  System",  and  (4)  held  by  the  Custodian  or  by  any
          subcustodian  referred  to in Section 2 hereof and  maintained  in any
          Approved Book-Entry System for Commercial Paper.

     B.   DELIVERY  OF  SECURITIES.  The  Custodian  shall  release  and deliver
          securities  or  participation  interests  owned by the  Fund  held (or
          deemed to be held) by the  Custodian  or  maintained  in a  Securities
          System  account or in an  Approved  Book-Entry  System for  Commercial
          Paper account only upon receipt of proper  instructions,  which may be
          continuing  instructions when deemed  appropriate by the parties,  and
          only in the following cases:

               1)   Upon sale of such securities or participation  interests for
                    the account of the Fund, BUT ONLY against receipt of payment
                    therefor;  if  delivery  is made in Boston or New York City,
                    payment  therefor shall be made in accordance with generally
                    accepted  clearing  house  procedures  or by use of  Federal

                                      -3-
<PAGE>
                    Reserve  Wire  System   procedures;   if  delivery  is  made
                    elsewhere  payment  therefor shall be in accordance with the
                    then current "street  delivery" custom or in accordance with
                    such  procedures  agreed to in writing  from time to time by
                    the  parties  hereto;  if the  sale is  effected  through  a
                    Securities  System,  delivery and payment  therefor shall be
                    made in  accordance  with  the  provisions  of  Paragraph  L
                    hereof;  if the sale of  commercial  paper is to be effected
                    through an Approved  Book-Entry System for Commercial Paper,
                    delivery and payment  therefor  shall be made in  accordance
                    with the provisions of Paragraph M hereof; if the securities
                    are to be sold  outside the United  States,  delivery may be
                    made in accordance with procedures agreed to in writing from
                    time to time by the parties hereto; for the purposes of this
                    subparagraph,  the term "sale" shall include the disposition
                    of a portfolio  security  (i) upon the exercise of an option
                    written by the Fund and (ii) upon the failure by the Fund to
                    make a successful bid with respect to a portfolio  security,
                    the continued holding of which is contingent upon the making
                    of such a bid;

               2)   Upon  the  receipt  of  payment  in   connection   with  any
                    repurchase   agreement  or  reverse   repurchase   agreement
                    relating to such securities and entered into by the Fund;

               3)   To the depository  agent in connection  with tender or other
                    similar offers for portfolio securities of the Fund;

               4)   To the issuer  thereof or its agent when such  securities or
                    participation  interests  are called,  redeemed,  retired or
                    otherwise  become payable;  PROVIDED that, in any such case,
                    the cash or other  consideration  is to be  delivered to the
                    Custodian or any subcustodian employed pursuant to Section 2
                    hereof;

               5)   To the issuer thereof,  or its agent,  for transfer into the
                    name of the  Fund or into  the  name of any  nominee  of the
                    Custodian  or into the  name or  nominee  name of any  agent
                    appointed pursuant to Paragraph K hereof or into the name or
                    nominee  name  of  any  subcustodian  employed  pursuant  to
                    Section 2 hereof;  or for exchange for a different number of
                    bonds,  certificates or other evidence representing the same
                    aggregate face amount or number of units;  PROVIDED that, in
                    any such case, the new securities or participation interests
                    are to be  delivered to the  Custodian  or any  subcustodian
                    employed pursuant to Section 2 hereof;

               6)   To the broker selling the same for examination in accordance
                    with  the  "street  delivery"  custom;   PROVIDED  that  the
                    Custodian  shall adopt such procedures as the Fund from time
                    to time shall  approve to ensure their prompt  return to the
                    Custodian  by the broker in the event the broker  elects not
                    to accept them;

               7)   For exchange or  conversion  pursuant to any plan of merger,
                    consolidation,    recapitalization,     reorganization    or
                    readjustment  of  the  securities  of  the  Issuer  of  such
                    securities, or pursuant to provisions for conversion of such
                    securities,  or pursuant to any deposit agreement;  provided

                                      -4-
<PAGE>
                    that, in any such case, the new securities and cash, if any,
                    are to be  delivered to the  Custodian  or any  subcustodian
                    employed pursuant to Section 2 hereof;

               8)   In the case of warrants,  rights or similar securities,  the
                    surrender  thereof in  connection  with the exercise of such
                    warrants,  rights or similar securities, or the surrender of
                    interim  receipts or  temporary  securities  for  definitive
                    securities;  PROVIDED  that,  in  any  such  case,  the  new
                    securities  and cash,  if any,  are to be  delivered  to the
                    Custodian or any subcustodian employed pursuant to Section 2
                    hereof;

               9)   For delivery in connection with any loans of securities made
                    by the Fund (such loans to be made  pursuant to the terms of
                    the Fund's current registration statement), BUT ONLY against
                    receipt of adequate  collateral  as agreed upon from time to
                    time by the Custodian and the Fund, which may be in the form
                    of  cash  or   obligations   issued  by  the  United  States
                    government,  its agencies or instrumentalities;  except that
                    in connection with any securities loans for which collateral
                    is  to  be  credited  to  the  Custodian's  account  in  the
                    book-entry  system  authorized  by the  U.S.  Department  of
                    Treasury,   the  Custodian   will  not  be  held  liable  or
                    responsible  for the  delivery of  securities  loaned by the
                    Fund prior to the receipt of such collateral;

               10)  For delivery as security in connection  with any  borrowings
                    by the Fund requiring a pledge or hypothecation of assets by
                    the Fund (if then permitted under circumstances described in
                    the current registration  statement of the Fund),  provided,
                    that the  securities  shall be released only upon payment to
                    the Custodian of the monies  borrowed,  except that in cases
                    where   additional   collateral  is  required  to  secure  a
                    borrowing already made,  further  securities may be released
                    for that purpose;  upon receipt of proper instructions,  the
                    Custodian may pay any such loan upon redelivery to it of the
                    securities   pledged  or  hypothecated   therefor  and  upon
                    surrender of the note or notes evidencing the loan;

               11)  When required for delivery in connection with any redemption
                    or repurchase  of Shares of the Fund in accordance  with the
                    provisions of Paragraph J hereof;

               12)  For  delivery  in  accordance  with  the  provisions  of any
                    agreement between the Custodian (or a subcustodian  employed
                    pursuant to Section 2 hereof) and a broker-dealer registered
                    under the Securities Exchange Act of 1934 and, if necessary,
                    the  Fund,  relating  to  compliance  with the  rules of The
                    Options Clearing  Corporation or of any registered  national
                    securities  exchange,  or of  any  similar  organization  or
                    organizations,   regarding   deposit   or  escrow  or  other
                    arrangements in connection with options  transactions by the
                    Fund;

                                      -5-
<PAGE>
               13)  For  delivery  in  accordance  with  the  provisions  of any
                    agreement  among the Fund,  the Custodian (or a subcustodian
                    employed  pursuant  to  Section  2  hereof),  and a  futures
                    commissions merchant,  relating to compliance with the rules
                    of the Commodity  Futures Trading  Commission  and/or of any
                    contract   market  or   commodities   exchange   or  similar
                    organization,  regarding  futures margin account deposits or
                    payments in  connection  with  futures  transactions  by the
                    Fund;

               14)  For any  other  proper  corporate  purpose,  BUT  ONLY  upon
                    receipt of, in addition to proper instructions,  a certified
                    copy of a vote of the Board  specifying the securities to be
                    delivered, setting forth the purpose for which such delivery
                    is to be made, declaring such purpose to be proper corporate
                    purpose,  and naming the person or persons to whom  delivery
                    of such securities shall be made.

     C.   REGISTRATION OF SECURITIES.  Securities  held by the Custodian  (other
          than  bearer  securities)  for  the  account  of  the  Fund  shall  be
          registered  in the name of the Fund or in the name of any  nominee  of
          the Fund or of any nominee of the Custodian, or in the name or nominee
          name of any agent appointed  pursuant to Paragraph K hereof, or in the
          name or nominee name of any subcustodian  employed pursuant to Section
          2  hereof,  or in the name or  nominee  name of The  Depository  Trust
          Company or Participants  Trust Company or Approved  Clearing Agency or
          Federal Book-Entry System or Approved Book-Entry System for Commercial
          Paper;  provided,  that  securities  are  held  in an  account  of the
          Custodian  or of such agent or of such  subcustodian  containing  only
          assets of the Fund or only assets held by the  Custodian or such agent
          or such  subcustodian as a custodian or subcustodian or in a fiduciary
          capacity for customers.  All certificates  for securities  accepted by
          the Custodian or any such agent or  subcustodian on behalf of the Fund
          shall be in "street" or other good  delivery form or shall be returned
          to the  selling  broker or dealer  who shall be  advised of the reason
          thereof.

     D.   BANK ACCOUNTS.  The Custodian  shall open and maintain a separate bank
          account or accounts in the name of the Fund,  subject only to draft or
          order  by the  Custodian  acting  in  pursuant  to the  terms  of this
          Agreement, and shall hold in such account or accounts,  subject to the
          provisions  hereof, all cash received by it from or for the account of
          the Fund  other  than cash  maintained  by the Fund in a bank  account
          established   and  used  in  accordance  with  Rule  17f-3  under  the
          Investment  Company Act of 1940.  Funds held by the  Custodian for the
          Fund may be  deposited by it to its credit as Custodian in the Banking
          Department of the Custodian or in such other banks or trust  companies
          as the Custodian may in its  discretion  deem  necessary or desirable;
          provided,  however,  that  every such bank or trust  company  shall be
          qualified to act as a custodian  under the  Investment  Company Act of
          1940 and that  each  such  bank or trust  company  and the funds to be
          deposited  with each such bank or trust  company  shall be approved in
          writing by two officers of the Fund.  Such funds shall be deposited by
          the  Custodian in its  capacity as  Custodian  and shall be subject to
          withdrawal only by the Custodian in that capacity.

     E.   PAYMENT FOR SHARES OF THE FUND. The Custodian  shall make  appropriate
          arrangements with the Transfer Agent and the principal  underwriter of
          the Fund to enable the Custodian to make certain it promptly  receives
          the  cash or  other  consideration  due to the  Fund  for  such new or
          treasury  Shares  as may be  issued  or sold  from time to time by the

                                      -6-
<PAGE>
          Fund,  in  accordance  with  the  governing   documents  and  offering
          prospectus  and statement of additional  information  of the Fund. The
          Custodian will provide prompt  notification to the Fund of any receipt
          by it of payments for Shares of the Fund.

     F.   INVESTMENT AND AVAILABILITY OF FEDERAL FUNDS.  Upon agreement  between
          the Fund and the Custodian,  the Custodian shall,  upon the receipt of
          proper instructions,  which may be continuing instructions when deemed
          appropriate by the parties,

               1)   invest  in such  securities  and  instruments  as may be set
                    forth in such  instructions  on the same day as received all
                    federal funds  received after a time agreed upon between the
                    Custodian and the Fund; and

               2)   make  federal  funds  available  to the Fund as of specified
                    times  agreed  upon  from  time to time by the  Fund and the
                    Custodian  in the amount of checks  received  in payment for
                    Shares  of the Fund  which  are  deposited  into the  Fund's
                    account.

     G.   COLLECTIONS. The Custodian shall promptly collect all income and other
          payments with respect to registered securities held hereunder to which
          the Fund shall be entitled  either by law or pursuant to custom in the
          securities  business,  and shall promptly collect all income and other
          payments with respect to bearer  securities if, on the date of payment
          by the issuer,  such  securities  are held by the  Custodian  or agent
          thereof and shall  credit such  income,  as  collected,  to the Fund's
          custodian account.

          The Custodian  shall do all things  necessary and proper in connection
          with such prompt  collections  and, without limiting the generality of
          the foregoing, the Custodian shall

               1)   Present  for payment  all  coupons  and other  income  items
                    requiring presentations;

               2)   Present for payment  all  securities  which may mature or be
                    called, redeemed, retired or otherwise become payable;

               3)   Endorse and deposit for collection, in the name of the Fund,
                    checks, drafts or other negotiable instruments;

               4)   Credit  income from  securities  maintained  in a Securities
                    System or in an Approved  Book-Entry  System for  Commercial
                    Paper at the time funds become  available to the  Custodian;
                    in the case of securities maintained in The Depository Trust
                    Company  funds  shall be  deemed  available  to the Fund not
                    later than the opening of business on the first business day
                    after receipt of such funds by the Custodian.

          The Custodian shall notify the Fund as soon as reasonably  practicable
          whenever income due on any security is not promptly collected.  In any
          case in which the Custodian does not receive any due and unpaid income
          after it has made demand for the same, it shall  immediately so notify
          the Fund in  writing,  enclosing  copies  of any  demand  letter,  any

                                      -7-
<PAGE>
          written response thereto,  and memoranda of all oral responses thereto
          and to telephonic  demands,  and await instructions from the Fund; the
          Custodian  shall in no case have any liability  for any  nonpayment of
          such income  provided  the  Custodian  meets the  standard of care set
          forth in Section 8 hereof.  The  Custodian  shall not be  obligated to
          take  legal  action  for  collection   unless  and  until   reasonably
          indemnified to its satisfaction.

          The  Custodian  shall also  receive and  collect all stock  dividends,
          rights and other items of like nature, and deal with the same pursuant
          to proper instructions relative thereto.

     H.   PAYMENT OF FUND MONEYS. Upon receipt of proper instructions, which may
          be continuing instructions when deemed appropriate by the parties, the
          Custodian  shall  pay out  moneys of the Fund in the  following  cases
          only:

               1)   Upon the purchase of  securities,  participation  interests,
                    options, futures contracts, forward contracts and options on
                    futures contracts  purchased for the account of the Fund but
                    only (a) against the receipt of

                    (i) such  securities  registered  as provided in Paragraph C
                    hereof or in proper form for transfer or

                    (ii) detailed  instructions signed by an officer of the Fund
                    regarding the participation interests to be purchased or

                    (iii)  written  confirmation  of the purchase by the Fund of
                    the options, futures contracts, forward contracts or options
                    on futures contracts

                    by the Custodian (or by a subcustodian  employed pursuant to
                    Section 2 hereof or by a clearing  corporation of a national
                    securities exchange of which the Custodian is a member or by
                    any  bank,  banking   institution  or  trust  company  doing
                    business in the United  States or abroad  which is qualified
                    under  the  Investment  Company  Act  of  1940  to  act as a
                    custodian and which has been  designated by the Custodian as
                    its agent  for this  purpose  or by the  agent  specifically
                    designated  in  such   instructions  as   representing   the
                    purchasers of a new issue of privately  placed  securities);
                    (b) in the case of a purchase  effected through a Securities
                    System,  upon receipt of the  securities  by the  Securities
                    System  in  accordance  with  the  conditions  set  forth in
                    Paragraph  L  hereof;  (c)  in the  case  of a  purchase  of
                    commercial  paper  effected  through an Approved  Book-Entry
                    System for  Commercial  Paper,  upon receipt of the paper by
                    the  Custodian  or   subcustodian  in  accordance  with  the
                    conditions set forth in Paragraph M hereof;  (d) in the case
                    of repurchase  agreements  entered into between the Fund and
                    another  bank or a  broker-dealer,  against  receipt  by the
                    Custodian  of  the  securities   underlying  the  repurchase
                    agreement  either in  certificate  form or  through an entry
                    crediting  the   Custodian's   segregated,   non-proprietary
                    account  at the  Federal  Reserve  Bank of Boston  with such
                    securities  along with written  evidence of the agreement by

                                      -8-
<PAGE>
                    the bank or broker-dealer to repurchase such securities from
                    the  Fund;  or (e)  with  respect  to  securities  purchased
                    outside of the United  States,  in  accordance  with written
                    procedures  agreed  to from time to time in  writing  by the
                    parties hereto;

               2)   When required in connection with the conversion, exchange or
                    surrender  of  securities  owned by the Fund as set forth in
                    Paragraph B hereof;

               3)   When required for the  redemption or repurchase of Shares of
                    the Fund in  accordance  with the  provisions of Paragraph J
                    hereof;

               4)   For the payment of any expense or liability  incurred by the
                    Fund,  including but not limited to the  following  payments
                    for the  account of the Fund:  advisory  fees,  distribution
                    plan payments,  interest, taxes, management compensation and
                    expenses,  accounting,  transfer  agent and legal fees,  and
                    other  operating  expenses  of the Fund  whether or not such
                    expenses are to be in whole or part  capitalized  or treated
                    as deferred expenses;

               5)   For the payment of any dividends or other  distributions  to
                    holders of Shares declared or authorized by the Board; and

               6)   For any  other  proper  corporate  purpose,  BUT  ONLY  upon
                    receipt of, in addition to proper instructions,  a certified
                    copy of a vote of the Board,  specifying  the amount of such
                    payment, setting forth the purpose for which such payment is
                    to be made,  declaring such purpose to be a proper corporate
                    purpose,  and  naming  the  person or  persons  to whom such
                    payment is to be made.

     I.   LIABILITY FOR PAYMENT IN ADVANCE OF RECEIPT OF  SECURITIES  PURCHASED.
          In any and every case where payment for purchase of securities for the
          account of the Fund is made by the  Custodian in advance of receipt of
          the   securities   purchased  in  the  absence  of  specific   written
          instructions  signed by two officers of the Fund to so pay in advance,
          the  Custodian  shall  be  absolutely  liable  to the  Fund  for  such
          securities to the same extent as if the  securities  had been received
          by the  Custodian;  EXCEPT that in the case of a repurchase  agreement
          entered  into by the Fund with a bank which is a member of the Federal
          Reserve  System,  the Custodian  may transfer  funds to the account of
          such bank prior to the receipt of (i) the  securities  in  certificate
          form subject to such  repurchase  agreement  or (ii) written  evidence
          that the  securities  subject to such  repurchase  agreement have been
          transferred by book-entry into a segregated non-proprietary account of
          the Custodian  maintained  with the Federal  Reserve Bank of Boston or
          (iii) the safekeeping  receipt,  PROVIDED that such securities have in
          fact been so  transferred  by  book-entry  and the written  repurchase
          agreement is received by the Custodian in due course;  AND EXCEPT that
          if the  securities  are to be  purchased  outside  the United  States,
          payment may be made in accordance with procedures agreed to in writing
          from time to time by the parties hereto.

     J.   PAYMENTS FOR  REPURCHASES OR  REDEMPTIONS OF SHARES OF THE FUND.  From
          such funds as may be  available  for the  purpose,  but subject to any
          applicable  votes  of  the  Board  and  the  current   redemption  and
          repurchase  procedures of the Fund, the Custodian shall,  upon receipt
          of  written  instructions  from the Fund or from the  Fund's  transfer
          agent or from the principal  underwriter,  make funds and/or portfolio

                                      -9-
<PAGE>
          securities  available for payment to holders of Shares who have caused
          their  Shares to be  redeemed  or  repurchased  by the Fund or for the
          Fund's account by its transfer agent or principal underwriter.

          The  Custodian  may  maintain a special  checking  account  upon which
          special checks may be drawn by shareholders of the Fund holding Shares
          for which certificates have not been issued. Such checking account and
          such special checks shall be subject to such rules and  regulations as
          the Custodian and the Fund may from time to time adopt.  The Custodian
          or the Fund may suspend or terminate use of such  checking  account or
          such special checks (either generally or for one or more shareholders)
          at any  time.  The  Custodian  and the Fund  shall  notify  the  other
          immediately of any such suspension or termination.

     K.   APPOINTMENT OF AGENTS BY THE CUSTODIAN.  The Custodian may at any time
          or times in its  discretion  appoint  (and may at any time remove) any
          other bank or trust  company  (provided  such bank or trust company is
          itself qualified under the Investment  Company Act of 1940 to act as a
          custodian  or is itself  an  eligible  foreign  custodian  within  the
          meaning of Rule 17f-5 under said Act) as the agent of the Custodian to
          carry out such of the duties and functions of the Custodian  described
          in this  Section  3 as the  Custodian  may from  time to time  direct;
          providED,  however,  that the  appointment of any such agent shall not
          relieve the Custodian of any of its  responsibilities  or  liabilities
          hereunder,  and as between the Fund and the  Custodian  the  Custodian
          shall be fully  responsible  for the  acts and  omissions  of any such
          agent.  For the purposes of this  Agreement,  any property of the Fund
          held by any such  agent  shall be deemed  to be held by the  Custodian
          hereunder.

     L.   DEPOSIT  OF  FUND  PORTFOLIO  SECURITIES  IN  SECURITIES  SYSTEMS  The
          Custodian may deposit and/or maintain securities owned by the Fund

                   (1)  in The Depository Trust Company;

                   (2)  in Participants Trust Company;

                   (3)  in any other Approved Clearing Agency;

                   (4)  in the Federal Book-Entry System; or

                   (5)  in an Approved Foreign Securities Depository

          in each case only in accordance with applicable  Federal Reserve Board
          and Securities and Exchange  Commission rules and regulations,  and at
          all times subject to the following provisions:


          (a)  The  Custodian  may  (either  directly  or  through  one or  more
          subcustodians  employed  pursuant to Section 2 keep  securities of the
          Fund  in  a  Securities  System  provided  that  such  securities  are
          maintained in a non-proprietary  account  ("Account") of the Custodian

                                      -10-
<PAGE>
          or such  subcustodian in the Securities System which shall not include
          any assets of the Custodian or such  subcustodian  or any other person
          other than  assets held by the  Custodian  or such  subcustodian  as a
          fiduciary, custodian, or otherwise for its customers.

          (b) The records of the  Custodian  with respect to  securities  of the
          Fund which are  maintained  in a Securities  System shall  identify by
          book-entry those  securities  belonging to the Fund, and the Custodian
          shall  be  fully  and  completely   responsible   for   maintaining  a
          recordkeeping  system capable of accurately and currently  stating the
          Fund's holdings maintained in each such Securities System.

          (c) The  Custodian  shall pay for  securities  purchased in book-entry
          form for the  account  of the Fund only upon (i)  receipt of notice or
          advice  from the  Securities  System  that such  securities  have been
          transferred  to the  Account,  and (ii) the making of any entry on the
          records of the  Custodian to reflect such payment and transfer for the
          account of the Fund. The Custodian shall transfer  securities sold for
          the account of the Fund only upon (i) receipt of notice or advice from
          the  Securities  System  that  payment  for such  securities  has been
          transferred  to the  Account,  and (ii) the  making of an entry on the
          records of the  Custodian to reflect such transfer and payment for the
          account  of the  Fund.  Copies  of all  notices  or  advices  from the
          Securities  System of transfers of  securities  for the account of the
          Fund  shall  identify  the  Fund,  be  maintained  for the Fund by the
          Custodian  and be promptly  provided to the Fund at its  request.  The
          Custodian  shall  promptly  send  to the  Fund  confirmation  of  each
          transfer  to or from the  account of the Fund in the form of a written
          advice or notice of each such  transaction,  and shall  furnish to the
          Fund  copies  of  daily  transaction   sheets  reflecting  each  day's
          transactions  in the Securities  System for the account of the Fund on
          the next business day.

          (d) The Custodian  shall promptly send to the Fund any report or other
          communication  received or obtained by the  Custodian  relating to the
          Securities System's  accounting system,  system of internal accounting
          controls or procedures for  safeguarding  securities  deposited in the
          Securities  System;  the Custodian shall promptly send to the Fund any
          report or other  communication  relating to the  Custodian's  internal
          accounting   controls  and  procedures  for  safeguarding   securities
          deposited in any  Securities  System;  and the Custodian  shall ensure
          that any  agent  appointed  pursuant  to  Paragraph  K  hereof  or any
          subcustodian employed pursuant to Section 2 hereof shall promptly send
          to the Fund and to the  Custodian  any  report or other  communication
          relating  to  such  agent's  or sub  custodian's  internal  accounting
          controls and procedures for safeguarding  securities  deposited in any
          Securities  System.  The Custodian's books and records relating to the
          Fund's  participation  in each  Securities  System  will at all  times
          during regular  business hours be open to the inspection of the Fund's
          authorized officers, employees or agents.

          (e) The Custodian  shall not act under this Paragraph L in the absence
          of receipt of a  certificate  of an officer of the Fund that the Board
          has approved the use of a particular  Securities System; the Custodian
          shall also obtain appropriate  assurance from the officers of the Fund
          that the Board has annually  reviewed the continued use by the Fund of
          each  Securities  System,  and the  Fund  shall  promptly  notify  the
          Custodian if the use of a Securities System is to be discontinued;  at
          the request of the Fund,  the Custodian  will terminate the use of any
          such Securities System as promptly as practicable.

                                      -11-
<PAGE>
          (f) Anything to the contrary in this  Agreement  notwithstanding,  the
          Custodian  shall be  liable  to the Fund for any loss or damage to the
          Fund  resulting  from use of the  Securities  System  by reason of any
          negligence,  misfeasance  or misconduct of the Custodian or any of its
          agents or  subcustodians  or of any of its or their  employees or from
          any  failure of the  Custodian  or any such agent or  subcustodian  to
          enforce  effectively such rights as it may have against the Securities
          System or any other  person;  at the election of the Fund, it shall be
          entitled to be subrogated to the rights of the Custodian  with respect
          to any claim against the  Securities  System or any other person which
          the Custodian may have as a consequence  of any such loss or damage if
          and to the  extent  that the Fund has not been made whole for any such
          loss or damage.

     M.   DEPOSIT OF FUND COMMERCIAL PAPER IN AN APPROVED  BOOK-ENTRY SYSTEM FOR
          COMMERCIAL PAPER. Upon receipt of proper  instructions with respect to
          each issue of direct issue commercial paper purchased by the Fund, the
          Custodian may deposit and/or  maintain direct issue  commercial  paper
          owned by the Fund in any  Approved  Book-Entry  System for  Commercial
          Paper, in each case only in accordance with applicable  Securities and
          Exchange Commission rules, regulations,  and no-action correspondence,
          and at all times subject to the following provisions:

          (a)  The  Custodian  may  (either  directly  or  through  one or  more
          subcustodians employed pursuant to Section 2) keep commercial paper of
          the  Fund in an  Approved  Book-Entry  System  for  Commercial  Paper,
          provided that such paper is issued in book entry form by the Custodian
          or  subcustodian  on behalf of an issuer with which the  Custodian  or
          subcustodian  has entered  into a  book-entry  agreement  and provided
          further that such paper is  maintained  in a  non-proprietary  account
          ("Account")  of the  Custodian  or such  subcustodian  in an  Approved
          Book-Entry  System for  Commercial  Paper  which shall not include any
          assets of the Custodian or such subcustodian or any other person other
          than assets held by the Custodian or such subcustodian as a fiduciary,
          custodian, or otherwise for its customers.

          (b) The records of the Custodian  with respect to commercial  paper of
          the Fund which is  maintained  in an  Approved  Book-Entry  System for
          Commercial  Paper shall identify by book-entry  each specific issue of
          commercial paper purchased by the Fund which is included in the System
          and  shall at all  times  during  regular  business  hours be open for
          inspection  by authorized  officers,  employees or agents of the Fund.
          The  Custodian   shall  be  fully  and  completely   responsible   for
          maintaining a recordkeeping system capable of accurately and currently
          stating the Fund's  holdings of  commercial  paper  maintained in each
          such System.

          (c)  The  Custodian  shall  pay  for  commercial  paper  purchased  in
          book-entry form for the account of the Fund only upon  contemporaneous
          (i)  receipt of notice or advice  from the issuer  that such paper has
          been issued, sold and transferred to the Account,  and (ii) the making
          of an entry on the records of the Custodian to reflect such  purchase,
          payment and transfer for the account of the Fund. The Custodian  shall
          transfer such commercial paper which is sold or cancel such commercial
          paper  which  is  redeemed  for the  account  of the  Fund  only  upon
          contemporaneous  (i) receipt of notice or advice that payment for such
          paper has been  transferred to the Account,  and (ii) the making of an
          entry on the  records of the  Custodian  to reflect  such  transfer or
          redemption  and  payment  for the  account of the Fund.  Copies of all


                                      -12-
<PAGE>
          notices,  advices and  confirmations  of transfers of commercial paper
          for the account of the Fund shall identify the Fund, be maintained for
          the Fund by the Custodian and be promptly  provided to the Fund at its
          request. The Custodian shall promptly send to the Fund confirmation of
          each  transfer  to or from  the  account  of the Fund in the form of a
          written advice or notice of each such  transaction,  and shall furnish
          to the Fund copies of daily  transaction  sheets reflecting each day's
          transactions  in the  System  for the  account of the Fund on the next
          business day.

          (d) The Custodian  shall promptly send to the Fund any report or other
          communication  received or obtained by the Custodian  relating to each
          System's accounting system,  system of internal accounting controls or
          procedures for safeguarding  commercial paper deposited in the System;
          the  Custodian  shall  promptly  send to the Fund any  report or other
          communication relating to the Custodian's internal accounting controls
          and  procedures for  safeguarding  commercial  paper  deposited in any
          Approved  Book-Entry  System for Commercial  Paper;  and the Custodian
          shall ensure that any agent  appointed  pursuant to Paragraph K hereof
          or any  subcustodian  employed  pursuant  to  Section  2 hereof  shall
          promptly  send to the Fund and to the  Custodian  any  report or other
          communication  relating to such  agent's or sub  custodian's  internal
          accounting   controls  and  procedures  for  safeguarding   securities
          deposited in any Approved Book-Entry System for Commercial Paper.

          (e) The Custodian  shall not act under this Paragraph M in the absence
          of receipt of a  certificate  of an officer of the Fund that the Board
          has approved the use of a particular  Approved  Book-Entry  System for
          Commercial   Paper;  the  Custodian  shall  also  obtain   appropriate
          assurance  from the  officers of the Fund that the Board has  annually
          reviewed the  continued  use by the Fund of each  Approved  Book-Entry
          System for Commercial  Paper,  and the Fund shall promptly  notify the
          Custodian if the use of an Approved  Book-Entry  System for Commercial
          Paper is to be discontinued; at the request of the Fund, the Custodian
          will terminate the use of any such System as promptly as practicable.

          (f) The Custodian (or subcustodian,  if the Approved Book-Entry System
          for Commercial  Paper is maintained by the  subcustodian)  shall issue
          physical commercial paper or promissory notes whenever requested to do
          so by the Fund or in the event of an electronic  system  failure which
          impedes issuance, transfer or custody of direct issue commercial paper
          by book-entry.

          (g) Anything to the contrary in this  Agreement  notwithstanding,  the
          Custodian  shall be  liable  to the Fund for any loss or damage to the
          Fund  resulting  from  use  of  any  Approved  Book-Entry  System  for
          Commercial   Paper  by  reason  of  any  negligence,   misfeasance  or
          misconduct of the Custodian or any of its agents or  subcustodians  or
          of any of its or their  employees or from any failure of the Custodian
          or any such agent or subcustodian to enforce  effectively  such rights
          as it may have against the System,  the issuer of the commercial paper
          or any other person; at the election of the Fund, it shall be entitled
          to be subrogated  to the rights of the  Custodian  with respect to any
          claim against the System,  the issuer of the  commercial  paper or any
          other person which the Custodian may have as a consequence of any such
          loss or  damage if and to the  extent  that the Fund has not been made
          whole for any such loss or damage.

                                      -13-
<PAGE>
     N.   SEGREGATED  ACCOUNT.  The  Custodian  shall  upon  receipt  of  proper
          instructions  establish and maintain a segregated  account or accounts
          for and on behalf of the Fund,  into which  account or accounts may be
          transferred cash and/or securities, including securities maintained in
          an account by the  Custodian  pursuant to  Paragraph L hereof,  (i) in
          accordance  with the  provisions of any agreement  among the Fund, the
          Custodian and any registered  broker-dealer (or any futures commission
          merchant),  relating  to  compliance  with the  rules  of the  Options
          Clearing   Corporation  and  of  any  registered  national  securities
          exchange (or of the  Commodity  Futures  Trading  Commission or of any
          contract   market  or  commodities   exchange),   or  of  any  similar
          organization or  organizations,  regarding  escrow or deposit or other
          arrangements  in connection  with  transactions  by the Fund, (ii) for
          purposes  of  segregating  cash  or  U.S.  Government   securities  in
          connection  with  options  purchased,  sold or  written by the Fund or
          futures  contracts or options  thereon  purchased or sold by the Fund,
          (iii) for the purposes of compliance  by the Fund with the  procedures
          required  by  Investment   Company  Act  Release  No.  10666,  or  any
          subsequent   release  or  releases  of  the  Securities  and  Exchange
          Commission  relating  to the  maintenance  of  segregated  accounts by
          registered  investment  companies and (iv) for other proper  purposes,
          BUT ONLY, in the case of clause (iv),  upon receipt of, in addition to
          proper instructions, a certificate signed by two officers of the Fund,
          setting forth the purpose such  segregated  account and declaring such
          purpose to be a proper purpose.

     O.   OWNERSHIP  CERTIFICATES FOR TAX PURPOSES.  The Custodian shall execute
          ownership and other  certificates  and  affidavits for all federal and
          state tax  purposes  in  connection  with  receipt  of income or other
          payments  with  respect  to  securities  of the Fund held by it and in
          connection with transfers of securities.

     P.   PROXIES.  The Custodian shall,  with respect to the securities held by
          it hereunder,  cause to be promptly delivered to the Fund all forms of
          proxies  and  all  notices  of  meetings  and  any  other  notices  or
          announcements  or other written  information  affecting or relating to
          the securities,  and upon receipt of proper instructions shall execute
          and deliver or cause its nominee to execute and deliver  such  proxies
          or other authorizations as may be required.  Neither the Custodian nor
          its nominee shall vote upon any of the securities or execute any proxy
          to vote  thereon  or give any  consent or take any other  action  with
          respect thereto (except as otherwise  herein  provided) unless ordered
          to do so by proper instructions.

     Q.   COMMUNICATIONS  RELATING TO FUND PORTFOLIO  SECURITIES.  The Custodian
          shall deliver promptly to the Fund all written information (including,
          without limitation,  pendency of call and maturities of securities and
          participation  interests  and  expirations  of  rights  in  connection
          therewith  and notices of exercise of call and put options  written by
          the Fund and the  maturity of futures  contracts  purchased or sold by
          the Fund)  received by the  Custodian  from issuers and other  persons
          relating to the securities and participation  interests being held for
          the Fund.  With respect to tender or exchange  offers,  the  Custodian
          shall deliver promptly to the Fund all written information received by
          the  Custodian  from  issuers  and  other  persons   relating  to  the
          securities  and  participation  interests  whose tender or exchange is
          sought  and from the  party  (or his  agents)  making  the  tender  or
          exchange offer.

                                      -14-
<PAGE>
     R.   EXERCISE  OF  RIGHTS;  TENDER  OFFERS.  In the case of tender  offers,
          similar  offers to  purchase or exercise  rights  (including,  without
          limitation,  pendency  of  calls  and  maturities  of  securities  and
          participation  interests  and  expirations  of  rights  in  connection
          therewith  and  notices of  exercise  of call and put  options and the
          maturity of futures contracts) affecting or relating to securities and
          participation  interests held by the Custodian  under this  Agreement,
          the Custodian  shall have  responsibility  for promptly  notifying the
          Fund of all such offers in accordance  with the standard of reasonable
          care set forth in Section 8 hereof.  For all such offers for which the
          Custodian  is  responsible  as provided in this  Paragraph R, the Fund
          shall  have  responsibility  for  providing  the  Custodian  with  all
          necessary  instructions  in timely  fashion.  Upon  receipt  of proper
          instructions,  the  Custodian  shall  timely  deliver to the issuer or
          trustee thereof,  or to the agent of either,  warrants,  puts,  calls,
          rights or similar  securities  for the purpose of being  exercised  or
          sold upon  proper  receipt  therefor  and upon  receipt of  assurances
          satisfactory  to the Custodian  that the new  securities  and cash, if
          any,  acquired by such action are to be delivered to the  Custodian or
          any subcustodian  employed pursuant to Section 2 hereof.  Upon receipt
          of proper instructions,  the Custodian shall timely deposit securities
          upon  invitations  for  tenders  of  securities  upon  proper  receipt
          therefor and upon receipt of assurances  satisfactory to the Custodian
          that  the  consideration  to be  paid  or  delivered  or the  tendered
          securities  are  to be  returned  to  the  Custodian  or  subcustodian
          employed pursuant to Section 2 hereof.  Notwithstanding  any provision
          of this  Agreement  to the  contrary,  the  Custodian  shall  take all
          necessary action,  unless otherwise directed to the contrary by proper
          instructions,  to comply with the terms of all mandatory or compulsory
          exchanges, calls, tenders,  redemptions, or similar rights of security
          ownership, and shall thereafter promptly notify the Fund in writing of
          such action.

     S.   DEPOSITORY  RECEIPTS.  The  Custodian  shall,  upon  receipt of proper
          instructions,  surrender or cause to be surrendered foreign securities
          to the depository used by an issuer of American Depository Receipts or
          International  Depository Receipts (hereinafter  collectively referred
          to as "ADRs") for such securities,  against a written receipt therefor
          adequately   describing   such   securities   and   written   evidence
          satisfactory  to the Custodian that the  depository  has  acknowledged
          receipt of  instructions to issue with respect to such securities ADRs
          in the name of a nominee  of the  Custodian  or in the name or nominee
          name of any subcustodian  employed  pursuant to Section 2 hereof,  for
          delivery to the  Custodian or such  subcustodian  at such place as the
          Custodian or such  subcustodian  may from time to time designate.  The
          Custodian shall, upon receipt of proper  instructions,  surrender ADRs
          to the issuer thereof  against a written receipt  therefor  adequately
          describing the ADRs surrendered and written  evidence  satisfactory to
          the Custodian that the issuer of the ADRs has acknowledged  receipt of
          instructions  to  cause  its  depository  to  deliver  the  securities
          underlying  such ADRs to the Custodian or to a  subcustodian  employed
          pursuant to Section 2 hereof.

     T.   INTEREST  BEARING CALL OR TIME  DEPOSITS.  The Custodian  shall,  upon
          receipt of proper instructions,  place interest bearing fixed term and
          call deposits with the banking department of such banking  institution
          (other  than  the  Custodian)  and in such  amounts  as the  Fund  may
          designate.  Deposits  may be  denominated  in U.S.  Dollars  or  other
          currencies. The Custodian shall include in its records with respect to
          the  assets of the Fund  appropriate  notation  as to the  amount  and
          currency of each such deposit,  the accepting banking  institution and
          other  appropriate  details  and shall  retain such forms of advice or

                                      -15-
<PAGE>
          receipt  evidencing  the  deposit,  if any, as may be forwarded to the
          Custodian by the banking  institution.  Such deposits  shall be deemed
          portfolio  securities of the applicable  Fund for the purposes of this
          Agreement,  and the Custodian  shall be responsible for the collection
          of income from such accounts and the  transmission of cash to and from
          such accounts.

     U.   OPTIONS, FUTURES CONTRACTS AND FOREIGN CURRENCY TRANSACTIONS.

               1.  OPTIONS.   The  Custodians  shall,  upon  receipt  of  proper
               instructions  and  in  accordance  with  the  provisions  of  any
               agreement  between the Custodian,  any  registered  broker-dealer
               and, if  necessary,  the Fund,  relating to  compliance  with the
               rules of the Options  Clearing  Corporation  or of any registered
               national   securities   exchange  or  similar   organization   or
               organizations,   receive  and  retain   confirmations   or  other
               documents,  if any,  evidencing  the  purchase  or  writing of an
               option  on a  security  or  securities  index or other  financial
               instrument  or index  by the  Fund;  deposit  and  maintain  in a
               segregated account for each Fund separately, either physically or
               by book-entry  in a Securities  System,  securities  subject to a
               covered  call  option  written by the Fund;  and  release  and/or
               transfer such  securities or other assets only in accordance with
               a  notice  or  other  communication  evidencing  the  expiration,
               termination or exercise of such covered  option  furnished by the
               Options Clearing Corporation,  the securities or options exchange
               on which such covered option is traded or such other organization
               as may be responsible for handling such options transactions. The
               Custodian  and the  broker-dealer  shall be  responsible  for the
               sufficiency of assets held in each Fund's  segregated  account in
               compliance with applicable margin maintenance requirements.

               2. FUTURES CONTRACTS. The Custodian shall, upon receipt of proper
               instructions,   receive  and  retain   confirmations   and  other
               documents,  if any,  evidencing the purchase or sale of a futures
               contract or an option on a futures contract by the Fund;  deposit
               and  maintain  in a  segregated  account,  for the benefit of any
               futures  commission  merchant,  assets  designated by the Fund as
               initial,  maintenance or variation  "margin" deposits  (including
               mark-to-market   payments)   intended   to  secure   the   Fund's
               performance  of  its  obligations  under  any  futures  contracts
               purchased or sold or any options on futures  contracts written by
               Fund,  in  accordance  with the  provisions  of any  agreement or
               agreements  among  the  Fund,  the  Custodian  and  such  futures
               commission  merchant,  designed  to comply  with the rules of the
               Commodity  Futures  Trading  Commission  and/or  of any  contract
               market or commodities exchange or similar organization  regarding
               such margin  deposits or payments;  and release  and/or  transfer
               assets in such margin  accounts only in accordance  with any such
               agreements or rules.  The  Custodian  and the futures  commission
               merchant shall be responsible  for the sufficiency of assets held
               in the  segregated  account  in  compliance  with the  applicable
               margin maintenance and mark-to-market payment requirements.

                                      -16-
<PAGE>
               3. FOREIGN EXCHANGE  TRANSACTIONS.  The Custodian shall, pursuant
               to proper  instructions,  enter into or cause a  subcustodian  to
               enter into foreign exchange  contracts or options to purchase and
               sell foreign  currencies  for spot and future  delivery on behalf
               and  for  the  account  of the  Fund.  Such  transactions  may be
               undertaken by the Custodian or subcustodian  with such banking or
               financial institutions or other currency brokers, as set forth in
               proper instructions. Foreign exchange contracts and options shall
               be  deemed  to  be  portfolio   securities   of  the  Fund;   and
               accordingly,  the  responsibility of the Custodian therefor shall
               be the same as and no greater than the Custodian's responsibility
               in  respect  of  other  portfolio  securities  of the  Fund.  The
               Custodian shall be responsible for the transmittal to and receipt
               of  cash  from  the  currency  broker  or  banking  or  financial
               institution  with  which the  contract  or  option  is made,  the
               maintenance of proper records with respect to the transaction and
               the maintenance of any segregated  account required in connection
               with the  transaction.  The  Custodian  shall  have no duty  with
               respect to the  selection of the  currency  brokers or banking or
               financial  institutions  with  which the Fund  deals or for their
               failure  to comply  with the  terms of any  contract  or  option.
               Without limiting the foregoing, it is agreed that upon receipt of
               proper  instructions  and insofar as funds are made  available to
               the Custodian for the purpose,  the Custodian may (if  determined
               necessary by the Custodian to consummate a particular transaction
               on behalf and for the  account  of the Fund)  make free  outgoing
               payments of cash in the form of U.S.  dollars or foreign currency
               before receiving  confirmation of a foreign exchange  contract or
               confirmation  that the  counter  value  currency  completing  the
               foreign  exchange  contact has been  delivered or  received.  The
               Custodian  shall not be  responsible  for any costs and  interest
               charges  which may be incurred by the Fund or the  Custodian as a
               result  of the  failure  or  delay of third  parties  to  deliver
               foreign exchange;  provided that the Custodian shall nevertheless
               be held to the standard of care set forth in, and shall be liable
               to the Fund in accordance with, the provisions of Section 8.

     V.        ACTIONS PERMITTED WITHOUT EXPRESS AUTHORITY. The Custodian may in
               its discretion, without express authority from the Fund:

               1)   make  payments  to itself or others  for minor  expenses  of
                    handling  securities or other similar items  relating to its
                    duties  under  this  Agreement,   PROVIDED,  that  all  such
                    payments  shall be  accounted  for by the  Custodian  to the
                    Treasurer of the Fund;

               2)   surrender  securities  in temporary  form for  securities in
                    definitive form;

               3)   endorse  for  collection,  in the name of the Fund,  checks,
                    drafts and other negotiable instruments; and

               4)   in  general,  attend  to  all  nondiscretionary  details  in
                    connection with the sale, exchange, substitution,  purchase,
                    transfer and other dealings with the securities and property
                    of the Fund except as otherwise directed by the Fund.

                                      -17-
<PAGE>
     W.   ADVANCES BY THE BANK.  The Bank may, in its sole  discretion,  advance
          funds on  behalf  of the Fund to make any  payment  permitted  by this
          Agreement  upon receipt of any proper  authorization  required by this
          Agreement  for such  payments  by the Fund.  Should  such a payment or
          payments,  with  advanced  funds,  result  in  an  overdraft  (due  to
          insufficiencies  of the Fund's account with the Bank, or for any other
          reason)   this   Agreement   deems  any  such   overdraft  or  related
          indebtedness  a loan made by the Bank to the Fund  payable  on demand.
          Such overdraft  shall bear interest at the current rate charged by the
          Bank for such  secured  loans  unless the Fund shall  provide the Bank
          with agreed upon compensating  balances. The Fund agrees that the Bank
          shall have a continuing  lien and  security  interest to the extent of
          any overdraft or indebtedness or the extent required by law, whichever
          is  greater,  in and to any  property  at any time  held by it for the
          Fund's  benefit or in which the Fund has an interest and which is then
          in the Bank's  possession or control (or in the  possession or control
          of any third party acting on the Bank's  behalf).  The Fund authorizes
          the Bank,  in the Bank's  sole  discretion,  at any time to charge any
          overdraft or indebtedness, together with interest due thereon, against
          any  balance  of  account  standing  to the  credit of the Fund on the
          Bank's books.

4. DUTIES OF BANK WITH RESPECT TO BOOKS OF ACCOUNT AND CALCULATIONS OF NET ASSET
   VALUE

     The Bank  shall as Agent  (or as  Custodian,  as the case may be) keep such
books of account (including records showing the adjusted tax costs of the Fund's
portfolio  securities)  and  render  as at the close of  business  on each day a
detailed  statement  of the  amounts  received  or paid  out  and of  securities
received or delivered for the account of the Fund during said day and such other
statements,  including  a  daily  trial  balance  and  inventory  of the  Fund's
portfolio  securities;  and shall furnish such other  financial  information and
data as from time to time requested by the Treasurer or any executive officer of
the Fund;  and shall compute and  determine,  as of the close of business of the
New York  Stock  Exchange,  or at such  other  time or times  as the  Board  may
determine,  the net asset  value of a Share in the Fund,  such  computation  and
determination to be made in accordance with the governing  documents of the Fund
and the votes and instructions of the Board at the time in force and applicable,
and promptly  notify the Fund and its investment  adviser and such other persons
as the Fund may request of the result of such computation and determination.  In
computing the net asset value the  Custodian  may rely upon security  quotations
received by telephone or otherwise from sources or pricing  services  designated
by the Fund by  proper  instructions,  and may  further  rely  upon  information
furnished  to it  by  any  authorized  officer  of  the  Fund  relative  (a)  to
liabilities  of the Fund not  appearing  on its  books  of  account,  (b) to the
existence,  status and proper  treatment of any reserve or reserves,  (c) to any
procedures  established  by the  Board  regarding  the  valuation  of  portfolio
securities,  and (d) to the value to be assigned to any bond,  note,  debenture,
Treasury bill, repurchase agreement, subscription right, security, participation
interests or other asset or property for which market quotations are not readily
available.

5. RECORDS AND MISCELLANEOUS DUTIES

     The Bank shall  create,  maintain and preserve all records  relating to its
activities and obligations  under this Agreement in such manner as will meet the
obligations  of  the  Fund  under  the  Investment  Company  Act of  1940,  with
particular attention to Section 31 thereof and Rules 31a-1 and 31a-2 thereunder,
applicable federal and state tax laws and any other law or administrative  rules
or  procedures  which may be  applicable  to the Fund.  All books of account and
records  maintained by the Bank in connection with the performance of its duties
under  this  Agreement  shall be the  property  of the Fund,  shall at all times
during  the  regular  business  hours  of the  Bank be open  for  inspection  by
authorized  officers,  employees  or  agents  of the  Fund,  and in the event of

                                      -18-
<PAGE>
termination  of this  Agreement  shall be delivered to the Fund or to such other
person or persons as shall be designated by the Fund. Disposition of any account
or record after any required period of preservation  shall be only in accordance
with  specific  instructions  received  from the  Fund.  The Bank  shall  assist
generally in the preparation of reports to  shareholders,  to the Securities and
Exchange  Commission,  including  Forms  N-SAR and  N-1Q,  to state  "blue  sky"
authorities and to others, audits of accounts,  and other ministerial matters of
like nature;  and,  upon  request,  shall  furnish the Fund's  auditors  with an
attested  inventory  of  securities  held  with  appropriate  information  as to
securities  in transit or in the process of purchase or sale and with such other
information as said auditors may from time to time request.  The Custodian shall
also  maintain  records  of all  receipts,  deliveries  and  locations  of  such
securities,  together  with a  current  inventory  thereof,  and  shall  conduct
periodic   verifications   (including  sampling  counts  at  the  Custodian)  of
certificates representing bonds and other securities for which it is responsible
under this Agreement in such manner as the Custodian  shall  determine from time
to time to be advisable in order to verify the accuracy of such  inventory.  The
Bank  shall  not  disclose  or use any  books  or  records  it has  prepared  or
maintained  by reason  of this  Agreement  in any  manner  except  as  expressly
authorized  herein or directed by the Fund, and the Bank shall keep confidential
any information obtained by reason of this Agreement.

6. OPINION OF FUND'S INDEPENDENT PUBLIC ACCOUNTANTS

     The Custodian shall take all reasonable  action,  as the Fund may from time
to time  request,  to  enable  the Fund to obtain  from  year to year  favorable
opinions  from the Fund's  independent  public  accountants  with respect to its
activities   hereunder  in  connection   with  the  preparation  of  the  Fund's
registration  statement  and  Form  N-SAR  or  other  periodic  reports  to  the
Securities and Exchange Commission and with respect to any other requirements of
such Commission.

7. COMPENSATION AND EXPENSES OF BANK

     The Bank shall be entitled to reasonable  compensation  for its services as
Custodian  and Agent,  as agreed upon from time to time between the Fund and the
Bank.   The  Bank  shall  be  entitled  to  receive  from  the  Fund  on  demand
reimbursement  for its  cash  disbursements,  expenses  and  charges,  including
counsel fees, in  connection  with its duties as Custodian and Agent  hereunder,
but excluding salaries and usual overhead expenses.

8. RESPONSIBILITY OF BANK

     So long as and to the extent that it is in the exercise of reasonable care,
the Bank as  Custodian  and Agent  shall be held  harmless  in  acting  upon any
notice, request, consent, certificate or other instrument reasonably believed by
it to be genuine and to be signed by the proper party or parties.

     The Bank as  Custodian  and Agent  shall be entitled to rely on and may act
upon  advice of counsel  (who may be counsel for the Fund) on all  matters,  and
shall be without  liability for any action  reasonably taken or omitted pursuant
to such advice.

     The Bank as Custodian and Agent shall be held to the exercise of reasonable
care in carrying out the  provisions of this  Agreement but shall be liable only
for its own negligent or bad faith acts or failures to act.  Notwithstanding the
foregoing,  nothing  contained in this  paragraph is intended to nor shall it be
construed  to  modify  the  standards  of care and  responsibility  set forth in
Section  2  hereof  with  respect  to  subcustodians  and in  subparagraph  f of
Paragraph  L of Section 3 hereof  with  respect  to  Securities  Systems  and in

                                      -19-
<PAGE>
subparagraph  g of  Paragraph M of Section 3 hereof with  respect to an Approved
Book-Entry System for Commercial Paper.

     The  Custodian  shall be  liable  for the acts or  omissions  of a  foreign
banking   institution   to  the  same  extent  as  set  forth  with  respect  to
subcustodians  generally  in  Section 2 hereof,  provided  that,  regardless  of
whether assets are maintained in the custody of a foreign banking institution, a
foreign  securities  depository or a branch of a U.S. bank, the Custodian  shall
not be liable for any loss, damage, cost, expense,  liability or claim resulting
from,  or caused by, the direction of or  authorization  by the Fund to maintain
custody of any securities or cash of the Fund in a foreign county including, but
not limited to, losses resulting from nationalization,  expropriation,  currency
restrictions,  acts of war,  civil war or terrorism,  insurrection,  revolution,
military or usurped powers,  nuclear fission,  fusion or radiation,  earthquake,
storm or other disturbance of nature or acts of God.

     If the Fund  requires  the Bank in any  capacity  to take any  action  with
respect to  securities,  which  action  involves  the  payment of money or which
action  may,  in the  opinion  of the Bank,  result  in the Bank or its  nominee
assigned  to the Fund  being  liable  for the  payment  of  money  or  incurring
liability of some other form,  the Fund,  as a  prerequisite  to  requiring  the
Custodian to take such action,  shall  provide  indemnity to the Custodian in an
amount and form satisfactory to it.

9. PERSONS HAVING ACCESS TO ASSETS OF THE FUND

     (i) No trustee,  director,  general partner,  officer, employee or agent of
the Fund  shall  have  physical  access  to the  assets  of the Fund held by the
Custodian or be authorized or permitted to withdraw any investments of the Fund,
nor shall the  Custodian  deliver any assets of the Fund to any such person.  No
officer or director,  employee or agent of the  Custodian  who holds any similar
position with the Fund or the  investment  adviser of the Fund shall have access
to the assets of the Fund.

     (ii) Access to assets of the Fund held hereunder shall only be available to
duly authorized officers, employees,  representatives or agents of the Custodian
or  other  persons  or  entities  for  whose  actions  the  Custodian  shall  be
responsible  to the extent  permitted  hereunder,  or to the Fund's  independent
public  accountants in connection with their auditing duties performed on behalf
of the Fund.

     (iii)  Nothing in this Section 9 shall  prohibit  any officer,  employee or
agent  of the  Fund  or of  the  investment  adviser  of the  Fund  from  giving
instructions  to the Custodian or executing a certificate so long as it does not
result in delivery of or access to assets of the Fund  prohibited  by  paragraph
(i) of this Section 9.

10. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT; SUCCESSOR CUSTODIAN

     This Agreement shall become  effective as of its execution,  shall continue
in full force and effect until  terminated by either party after August 31, 2000
by an instrument in writing  delivered or mailed,  postage  prepaid to the other
party, such termination to take effect not sooner than sixty (60) days after the
date of such  delivery  or mailing;  PROVIDED,  that the Fund may at any time by
action of its  Board,  (i)  substitute  another  bank or trust  company  for the
Custodian by giving notice as described  above to the Custodian in the event the
Custodian  assigns  this  Agreement  to  another  party  without  consent of the
noninterested  Trustees  of  the  Funds,  or  (ii)  immediately  terminate  this
Agreement in the event of the  appointment  of a conservator or receiver for the
Custodian  by the  Federal  Deposit  Insurance  Corporation  or by  the  Banking
Commissioner  of The  Commonwealth of  Massachusetts  or upon the happening of a
like event at the  direction  of an  appropriate  regulatory  agency or court of
competent jurisdiction. Upon termination of the Agreement, the Fund shall pay to

                                      -20-
<PAGE>
the Custodian such compensation as may be due as of the date of such termination
(and  shall  likewise  reimburse  the  Custodian  for its  costs,  expenses  and
disbursements).

     This  Agreement may be amended at any time by the written  agreement of the
parties hereto. If a majority of the non-interested trustees of any of the Funds
determines  that the  performance  of the Custodian has been  unsatisfactory  or
adverse to the interests of  shareholders of any Fund or Funds or that the terms
of the  Agreement are no longer  consistent  with  publicly  available  industry
standards,  then the Fund or Funds shall give written notice to the Custodian of
such  determination  and the  Custodian  shall have 60 days to (1) correct  such
performance  to  the  satisfaction  of  the   non-interested   trustees  or  (2)
renegotiate terms which are satisfactory to the  non-interested  trustees of the
Funds. If the conditions of the preceding  sentence are not met then the Fund or
Funds may terminate this Agreement on sixty (60) days written notice.

     The Board of the Fund shall, forthwith,  upon giving or receiving notice of
termination of this Agreement,  appoint as successor custodian,  a bank or trust
company having the qualifications required by the Investment Company Act of 1940
and the Rules  thereunder.  The Bank, as Custodian,  Agent or otherwise,  shall,
upon  termination of the Agreement,  deliver to such  successor  custodian,  all
securities  then held  hereunder  and all funds or other  properties of the Fund
deposited  with or held by the  Bank  hereunder  and all  books of  account  and
records kept by the Bank pursuant to this  Agreement,  and all documents held by
the Bank  relative  thereto.  In the event that no written  order  designating a
successor  custodian shall have been delivered to the Bank on or before the date
when such termination  shall become  effective,  then the Bank shall not deliver
the  securities,  funds and other  properties  of the Fund to the Fund but shall
have the right to deliver to a bank or trust company  doing  business in Boston,
Massachusetts  of its own selection  meeting the above required  qualifications,
all funds,  securities  and properties of the Fund held by or deposited with the
Bank,  and all books of account  and records  kept by the Bank  pursuant to this
Agreement, and all documents held by the Bank relative thereto.  Thereafter such
bank or trust  company  shall  be the  successor  of the  Custodian  under  this
Agreement.

11. INTERPRETIVE AND ADDITIONAL PROVISIONS

     In connection with the operation of this  Agreement,  the Custodian and the
Fund  may  from  time to time  agree on such  provisions  interpretive  of or in
addition to the  provisions  of this  Agreement as may in their joint opinion be
consistent  with the general tenor of this Agreement.  Any such  interpretive or
additional  provisions shall be in a writing signed by both parties and shall be
annexed  hereto,  PROVIDED that no such  interpretive  or additional  provisions
shall contravene any applicable federal or state regulations or any provision of
the governing  instruments of the Fund. No interpretive or additional provisions
made as provided in the preceding sentence shall be deemed to be an amendment of
this Agreement.

12. NOTICES

     Notices and other writings  delivered or mailed postage prepaid to the Fund
addressed to 24 Federal Street,  Boston,  Massachusetts  02110, or to such other
address as the Fund may have designated to the Bank, in writing, or to Investors
Bank & Trust Company, 24 Federal Street,  Boston,  Massachusetts 02110, shall be
deemed to have been  properly  delivered or given  hereunder  to the  respective
addressees.

13. MASSACHUSETTS LAW TO APPLY

     This Agreement  shall be construed and the provisions  thereof  interpreted
under and in accordance with the laws of The Commonwealth of Massachusetts.

                                      -21-
<PAGE>
     If the Fund is a  Massachusetts  business  trust,  the Custodian  expressly
acknowledges  the  provision  in the Fund's  declaration  of Trust  limiting the
personal  liability  of the  trustees  and  shareholders  of the  Fund;  and the
Custodian  agrees that it shall have recourse only to the assets of the Fund for
the  payment of claims or  obligations  as between  the  Custodian  and the Fund
arising out of this Agreement,  and the Custodian shall not seek satisfaction of
any such claim or obligation from the trustees or shareholders of the Fund.

14. ADOPTION OF THE AGREEMENT BY THE FUND

     The Fund represents that its Board has approved this Agreement and has duly
authorized the Fund to adopt this Agreement,  such adoption to be evidenced by a
letter agreement  between the Fund and the Bank reflecting such adoption,  which
letter  agreement shall be dated and signed by a duly authorized  officer of the
Fund and duly authorized  officer of the Bank. This Agreement shall be deemed to
be duly  executed and delivered by each of the parties in its name and behalf by
its duly authorized  officer as of the date of such letter  agreement,  and this
Agreement  shall be deemed to supersede  and  terminate,  as of the date of such
letter agreement, all prior agreements between the Fund and the Bank relating to
the custody of the Fund's assets.




                                    * * * * *














                                      -22-




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(K)(1)
<SEQUENCE>10
<FILENAME>b52674a1exv99wxkyx1y.txt
<DESCRIPTION>EX-99.(K)(1) SUPPLEMENT TO THE TRANSFER AGENCY AND SERVICES AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (k)(1)

                                                December 20, 2004

PFPC Inc.
4400 Computer Drive
Westborough, MA 01581-5120
Attn:  President

     Re:  Eaton Vance Enhanced Equity Income Fund II

Dear Sirs:

Please be advised that,  pursuant to Trustee  action taken on December 20, 2004,
your firm was appointed  transfer and dividend  disbursing agent for Eaton Vance
Enhanced  Equity  Income Fund II.  Accordingly,  pursuant to Sections  10(e) and
12(a)  of that  certain  Amended  and  Restated  Transfer  Agency  and  Services
Agreement  dated as of June 16,  2003,  by and between PFPC Inc. and each of the
various Eaton Vance Funds listed on Exhibit 1 thereto (the "Agreement"), you are
hereby  notified that Eaton Vance Enhanced  Equity Income Fund II has been added
as a party to the  Agreement  and that Exhibit 1 and Schedule B to the Agreement
(as attached hereto) are hereby restated in their entirety.

                                    Eaton Vance Enhanced Equity Income Fund II


                                    By:  /s/ Duncan W. Richardson
                                         --------------------------------------
                                         President








Accepted and Acknowledged:

PFPC Inc.


By:  /s/ Michael G. McCarthy
     ----------------------------------
     Authorized Officer
<PAGE>
                                                                       EXHIBIT 1

                                  LIST OF FUNDS
                           Restated December 20, 2004

Eaton Vance Municipal Income Trust
Eaton Vance California Municipal Income Trust
Eaton Vance Florida Municipal Income Trust
Eaton Vance Massachusetts Municipal Income Trust
Eaton Vance Michigan Municipal Income Trust
Eaton Vance New Jersey Municipal Income Trust
Eaton Vance New York Municipal Income Trust
Eaton Vance Ohio Municipal Income Trust
Eaton Vance Pennsylvania Municipal Income Trust

Eaton Vance Insured Municipal Bond Fund
Eaton Vance Insured California Municipal Bond Fund
Eaton Vance Insured New York Municipal Bond Fund

Eaton Vance Insured Municipal Bond Fund II
Eaton Vance Insured California Municipal Bond Fund II
Eaton Vance Insured Florida Municipal Bond Fund
Eaton Vance Insured Massachusetts Municipal Bond Fund
Eaton Vance Insured Michigan Municipal Bond Fund
Eaton Vance Insured New Jersey Municipal Bond Fund
Eaton Vance Insured New York Municipal Bond Fund II
Eaton Vance Insured Ohio Municipal Bond Fund
Eaton Vance Pennsylvania Municipal Bond Fund

Eaton Vance Limited Duration Income Fund

Eaton Vance Tax-Advantaged Dividend Income Fund

Eaton Vance Senior Floating-Rate Trust

Eaton Vance Tax-Advantaged Global Dividend Income Fund

Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund

Eaton Vance Floating-Rate Income Trust

Eaton Vance Enhanced Equity Income Fund

Eaton Vance Enhanced Equity Income Fund II
<PAGE>
                                   SCHEDULE B
                                   ----------

                              Restated May 21, 2004

                                  FEE SCHEDULE


1. Initial Public Offering Fees
   ----------------------------

   IPO Project Administration Fee:             $3,000 per Fund

   IPO Project Administration Fee covers:

          Issuance of up to 1,000  certificates  - Issuance of  certificates  in
          excess of 1,000 to be billed at $2.00 per certificate

          Administration  coordination  with IPO client,  underwriter  and legal
          representatives

          Attendance  at closing (out of pocket  expenses  associated  with such
          attendance will be billed as incurred)

          Set-up,  testing  and  implementation  of  electronic  settlement  and
          delivery of shares through The Depository Trust Company

2. Over-allotment Fee: $1,000 per Fund:
   ------------------------------------

                  Applies in the event that the underwriters elect to exercise
                  an over-allotment option which requires a second closing


3. Standard Service Fee:
   --------------------

   (a)    The  following  standard  service fees shall apply with respect to the
          shares offered by: Eaton Vance Insured Municipal Bond Fund;

                Eaton Vance Insured California Municipal Bond Fund;
                Eaton Vance Insured New York Municipal Bond Fund;
                Eaton Vance Limited Duration Income Fund;
                Eaton Vance Tax-Advantaged Dividend Income Fund;
                Eaton Vance Senior Floating-Rate Trust;
                Eaton Vance Tax-Advantaged Global Dividend Income Fund;
                Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund;
                Eaton Vance Floating-Rate Income Trust;
                Eaton Vance Enhanced Equity Income Fund; and
                Eaton Vance Enhanced Equity Income Fund II

          Annual Service Fee:                         $15.00 Per Account

          Monthly Minimum Fee:                        $5,000.00
<PAGE>
   (b)    The  following  standard  service fees shall apply with respect to the
          shares offered by:

                Eaton Vance Municipal Income Trust;
                Eaton Vance California Municipal Income Trust;
                Eaton Vance Florida Municipal Income Trust;
                Eaton Vance Massachusetts Municipal Income Trust;
                Eaton Vance Michigan Municipal Income Trust;
                Eaton Vance New Jersey Municipal Income Trust;
                Eaton Vance New York Municipal Income Trust;
                Eaton Vance Ohio Municipal Income Trust; and
                Eaton Vance Pennsylvania Municipal Income Trust.

          Each Fund shall pay 9 basis points  annually on the average  daily net
          assets, paid monthly,  in arrears,  with respect to the shares offered
          by the Fund.

   (c)    The  following  standard  service fees shall apply with respect to the
          shares offered by:

                Eaton Vance Insured Municipal Bond Fund II;
                Eaton Vance Insured California Municipal Bond Fund II;
                Eaton Vance Insured Florida Municipal Bond Fund;
                Eaton Vance Insured Massachusetts Municipal Bond Fund;
                Eaton Vance Insured Michigan Municipal Bond Fund;
                Eaton Vance Insured New Jersey Municipal Bond Fund;
                Eaton Vance Insured New York Municipal Bond Fund II;
                Eaton Vance Insured Ohio Municipal Bond Fund; and
                Eaton Vance Insured Pennsylvania Municipal Bond Fund.

          Each Fund shall pay 7.5 basis points annually on the average daily net
          assets, paid monthly,  in arrears,  with respect to the shares offered
          by the Fund.

After the one year anniversary of the effective date of this Agreement, PFPC may
adjust  the above  fees once per  calendar  year,  upon  thirty  (30) days prior
written notice in an amount not to exceed the cumulative  percentage increase in
the Consumer Price Index for All Urban Consumers (CPI-U) U.S. City Average,  All
items  (unadjusted) - (1982-84=100),  published by the U.S.  Department of Labor
since the last such adjustment in the Fund's monthly fees (or the Effective Date
absent a prior such adjustment).

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(K)(3)
<SEQUENCE>11
<FILENAME>b52674a1exv99wxkyx3y.txt
<DESCRIPTION>EX-99.(K)(3) ADMINISTRATION AGREEMENT
<TEXT>
<PAGE>
                                                                  EXHIBIT (k)(3)

                   EATON VANCE ENHANCED EQUITY INCOME FUND II
                            ADMINISTRATION AGREEMENT

     AGREEMENT  made  this  20th day of  December,  2004,  between  Eaton  Vance
Enhanced Equity Income Fund II, a Massachusetts business trust (the "Fund"), and
Eaton Vance Management, a Massachusetts business trust (the "Administrator").

     1. DUTIES OF THE  ADMINISTRATOR.  The Fund hereby employs the Administrator
to act as administrator  for and to administer the affairs of the Fund,  subject
to the  supervision  of the Trustees of the Fund for the period and on the terms
set forth in this Agreement.

     The Administrator hereby accepts such employment,  and agrees to administer
the Fund's business affairs and, in connection therewith, to furnish for the use
of the Fund office space and all  necessary  office  facilities,  equipment  and
personnel for  administering  the affairs of the Fund. The  Administrator  shall
also pay the salaries and  compensation of all officers and Trustees of the Fund
who are members of the Administrator's organization and who render executive and
administrative  services to the Fund, and the salaries and  compensation  of all
other personnel of the Administrator  performing  management and  administrative
services for the Fund. The Administrator shall for all purposes herein be deemed
to be an  independent  contractor  and  shall,  except  as  otherwise  expressly
provided or  authorized,  have no authority to act for or represent  the Fund in
any way or otherwise be deemed an agent of the Fund.

     In connection with its  responsibilities  as Administrator of the Fund, the
Administrator  (i) will assist in preparing  all annual,  semi-annual  and other
reports required to be sent to Fund  shareholders,  and arrange for the printing
and  dissemination  of such  reports  to  shareholders;  (ii) will  prepare  and
assemble all reports  required to be filed by the Fund with the  Securities  and
Exchange  Commission  ("SEC") on Forms N-SAR and N-CSR, or on such other form as
the SEC may substitute  for Form N-SAR or N-CSR,  and file such reports with the
SEC;  (iii) will review the  provision  of  services  by the Fund's  independent
accountants,  including, but not limited to, the preparation by such accountants
of audited  financial  statements of the Fund and the Fund's federal,  state and
local tax returns;  and make such reports and recommendations to the Trustees of
the Fund  concerning  the  performance  of the  independent  accountants  as the
Trustees deem appropriate; (iv) will arrange for the filing with the appropriate
authorities all required federal,  state and local tax returns; (v) will arrange
for the  dissemination to shareholders of the Fund's proxy  materials,  and will
oversee the  tabulation  of proxies by the Fund's  transfer  agent or other duly
authorized  proxy  tabulator;  (vi) will review and  supervise  the provision of
custodian services to the Fund; and make such reports and recommendations to the
Trustees  concerning  the  provision  of  such  services  as the  Trustees  deem
appropriate; (vii) will value all such portfolio investments and other assets of
the  Fund as may be  designated  by the  Trustees  (subject  to any  guidelines,
directions  and  instructions  of the  Trustees),  and review and  supervise the
calculation of the net asset value of the Fund's shares by the custodian; (viii)
will negotiate the terms and conditions under which transfer agency and dividend
disbursing services will be provided to the Fund, and the fees to be paid by the
Fund in  connection  therewith;  review and  supervise the provision of transfer
agency and dividend  disbursing  services to the Fund; and make such reports and
recommendations  to the  Trustees  concerning  the  performance  of  the  Fund's
transfer and dividend  disbursing agent as the Trustees deem  appropriate;  (ix)
will establish the accounting policies of the Fund;  reconcile accounting issues
which may arise with  respect to the Fund's  operations;  and  consult  with the
Fund's  independent  accountants,  legal  counsel,  custodian,   accounting  and
bookkeeping  agents and transfer and dividend  disbursing  agent as necessary in
connection  therewith;  (x) will determine the amount of all distributions to be
paid by the Fund to its  shareholders;  prepare and arrange for the  printing of
notices to  shareholders  regarding  such  distributions  and provide the Fund's
transfer and dividend disbursing agent and custodian with such information as is
required  for such  parties  to  effect  the  payment  of  distributions  and to
implement the Fund's  dividend  reinvestment  plan;  (xi) will review the Fund's
<PAGE>
bills and authorize  payments of such bills by the Fund's custodian;  (xii) will
make  recommendations  to the  Trustees  as to  whether  the  Fund  should  make
repurchase or tender offers for its own shares;  arrange for the preparation and
filing of all documents  required to be filed by the Fund with the SEC;  arrange
for the preparation and  dissemination  of all appropriate  repurchase or tender
offer  documents and papers on behalf of the Fund; and supervise and conduct the
Fund's periodic  repurchase or tender offers for its own shares;  (xiii) monitor
any  variance  between  the  market  value and net asset  value per  share,  and
periodically  report to the  Trustees  available  actions  that may conform such
values; (xiv) monitor the activities of any shareholder servicing agent retained
by the  Administrator  and  periodically  report  to  the  Trustees  about  such
activities;  (xv)  will  arrange  for the  preparation  and  filing of all other
reports,  forms,  registration  statements and documents required to be filed by
the Fund with the SEC, the National Association of Securities Dealers,  Inc. and
any securities  exchange where Fund shares are listed; and (xvi) will provide to
the Fund such  other  internal  legal,  auditing  and  accounting  services  and
internal executive  management and administrative  services as the Trustees deem
appropriate to conduct the Fund's business affairs.

     Notwithstanding  the foregoing,  the  Administrator  shall not be deemed to
have assumed any duties with respect to, and shall not be  responsible  for, the
management  of the  Fund's  assets or the  rendering  of  investment  advice and
supervision  with respect thereto or the distribution of shares of the Fund, nor
shall the  Administrator  be deemed to have  assumed or have any  responsibility
with respect to functions  specifically assumed by any transfer agent, custodian
or shareholder servicing agent of the Fund.

     SUB-ADMINISTRATORS.    The   Administrator   may   employ   one   or   more
sub-administrators from time to time to perform such of the acts and services of
the  Administrator  and upon such  terms and  conditions  as may be agreed  upon
between  the  Administrator  and such  sub-administrators  and  approved  by the
Trustees of the Fund.

     2.  COMPENSATION  OF THE  ADMINISTRATOR.  The Board of Trustees of the Fund
have  currently  determined  that,  based on the current  level of  compensation
payable  to  Eaton  Vance  Management  by the  Fund  under  the  Fund's  present
Investment  Advisory  Agreement with Eaton Vance  Management,  the Administrator
shall  receive no  compensation  from the Fund in respect of the  services to be
rendered  and the  facilities  to be  provided by the  Administrator  under this
Agreement.   If  the  Trustees  subsequently  determine  that  the  Fund  should
compensate the Administrator for such services and facilities, such compensation
shall be set forth in a new agreement or in an amendment to this Agreement to be
entered into by the parties hereto.

     3. ALLOCATION OF CHARGES AND EXPENSES.  It is understood that the Fund will
pay all its  expenses  other  than those  expressly  stated to be payable by the
Administrator  hereunder,  which  expenses  payable by the Fund  shall  include,
without implied limitation,  (i) expenses of maintaining the Fund and continuing
its existence; (ii) registration of the Fund under the Investment Company Act of
1940; (iii) commissions, fees and other expenses connected with the acquisition,
holding and  disposition  of securities  and other  investments;  (iv) auditing,
accounting and legal expenses;  (v) taxes and interest;  (vi) governmental fees;
(vii) expenses of repurchase  and  redemption (if any) of shares,  including all
expenses incurred in conducting  repurchase and tender offers for the purpose of
repurchasing Fund shares; (viii) expenses of registering and qualifying the Fund
and its  shares  under  federal  and  state  securities  laws  and of  preparing
registration  statements  and  amendments  for such  purposes;  (ix) expenses of
reports and notices to shareholders  and of meetings of  shareholders  and proxy
solicitations  therefor;  (x) expenses of reports to  governmental  officers and
commissions;  (xi) insurance expenses; (xii) association membership dues; (xiii)
fees,  expenses  and  disbursements  of  custodians  and  subcustodians  for all
services to the Fund  (including  without  limitation  safekeeping  of funds and
securities, keeping of books and accounts and determination of net asset value);
(xiv) fees,  expenses and disbursements of transfer agents,  dividend disbursing
agents,  shareholder  servicing  agents and  registrars  for all services to the
Fund;  (xv) expenses of listing shares with a stock  exchange;  (xvi) any direct

                                       2
<PAGE>
charges  to  shareholders   approved  by  the  Trustees  of  the  Fund;   (xvii)
compensation  of and any expenses of Trustees of the Fund who are not members of
the Administrator's  organization;  (xviii) all payments to be made and expenses
to be assumed by the Fund in connection  with the  distribution  of Fund shares;
(xix)  any  pricing  and  valuation  services  employed  by the  Fund;  (xx) any
investment  advisory fee payable to an  investment  adviser;  (xxi) all expenses
incurred in  connection  with  leveraging  the Fund's  assets  through a line of
credit,  or  issuing  and  maintaining   preferred   shares;   and  (xxii)  such
non-recurring items as may arise, including expenses incurred in connection with
litigation,  proceedings and claims and obligations of the Fund to indemnify its
shareholders, Trustees, officers and employees with respect thereto.

     4.  OTHER  INTERESTS.   It  is  understood  that  Trustees,   officers  and
shareholders of the Fund are or may be or become interested in the Administrator
as trustees, officers,  employees,  shareholders or otherwise and that trustees,
officers,  employees  and  shareholders  of the  Administrator  are or may be or
become similarly  interested in the Fund, and that the  Administrator  may be or
become  interested  in the  Fund  as a  shareholder  or  otherwise.  It is  also
understood  that  trustees,   officers,   employees  and   shareholders  of  the
Administrator  may be or become  interested (as directors,  trustees,  officers,
employees, stockholders or otherwise) in other companies or entities (including,
without  limitation,  other  investment  companies) that the  Administrator  may
organize,  sponsor or acquire,  or with which it may merge or  consolidate,  and
that  the  Administrator  or its  subsidiaries  or  affiliates  may  enter  into
advisory,   management  or  administration  agreements  or  other  contracts  or
relationship with such other companies or entities.

     5.  LIMITATION  OF  LIABILITY  OF THE  ADMINISTRATOR.  The  services of the
Administrator  to  the  Fund  are  not  to  be  deemed  to  be  exclusive,   the
Administrator  being  free to  render  services  to others  and  engage in other
business  activities.  In the absence of willful  misfeasance,  bad faith, gross
negligence or reckless  disregard of obligations or duties hereunder on the part
of the Administrator, the Administrator shall not be subject to liability to the
Fund or to any shareholder of the Fund for any act or omission in the course of,
or connected with,  rendering  services hereunder or for any losses which may be
sustained in the  acquisition,  holding or  disposition of any security or other
investment.

     6. DURATION AND TERMINATION OF THIS AGREEMENT.  This Agreement shall become
effective  upon the date of its  execution,  and,  unless  terminated  as herein
provided,  shall remain in full force and effect through and including  December
20, 2006 and shall  continue in full force and effect  indefinitely  thereafter,
but only so long as such  continuance  after  December 20, 2006 is  specifically
approved at least annually (i) by the Board of Trustees of the Fund, and (ii) by
the vote of a  majority  of those  Trustees  of the Fund who are not  interested
persons of the Administrator or the Fund.

     Either  party  hereto may,  at any time on sixty (60) days'  prior  written
notice to the other,  terminate  this Agreement by action of the Trustees of the
Fund or the  trustees of the  Administrator,  and the Fund may, at any time upon
such written notice to the  Administrator,  terminate the Agreement by vote of a
majority of the outstanding  voting securities of the Fund. This Agreement shall
terminate automatically in the event of its assignment.

     7. AMENDMENTS OF THE AGREEMENT.  This Agreement may be amended by a writing
signed by both parties  hereto,  provided  that no  amendment to this  Agreement
shall  be  effective  until  approved  (i) by the  vote of a  majority  of those
Trustees of the Fund who are not interested  persons of the Administrator or the
Fund, and (ii) by vote of the Board of Trustees of the Fund.

                                       3
<PAGE>
     8. LIMITATION OF LIABILITY. Each party expressly acknowledges the provision
in the other party's  Agreement and  Declaration  of Trust limiting the personal
liability of its  shareholders  officers,  and  Trustees,  and each party hereby
agrees  that it shall have  recourse to the other party for payment of claims or
obligations  as  between  the Fund  and the  Administrator  arising  out of this
Agreement  and  shall  not seek  satisfaction  from the  Trustees,  officers  or
shareholders of the other party.

     9. USE OF THE NAME "EATON VANCE." The Administrator  hereby consents to the
use by the Fund of the name "Eaton Vance" as part of the Fund's name;  provided,
however,  that such consent  shall be  conditioned  upon the  employment  of the
Administrator  or one of its  affiliates as the  administrator  of the Fund. The
name  "Eaton  Vance" or any  variation  thereof may be used from time to time in
other connections and for other purposes by the Administrator and its affiliates
and other investment companies that have obtained consent to the use of the name
"Eaton  Vance."  The  Administrator  shall have the right to require the Fund to
cease  using  the name  "Eaton  Vance"  as part of the  Fund's  name if the Fund
ceases,  for any reason, to employ the Administrator or one of its affiliates as
the Fund's administrator.  Future names adopted by the Fund for itself,  insofar
as  such  names  include   identifying   words  requiring  the  consent  of  the
Administrator,  shall be the property of the  Administrator and shall be subject
to the same terms and conditions.

     10. CERTAIN  DEFINITIONS.  The terms "assignment" and "interested  persons"
when used herein shall have the respective  meanings specified in the Investment
Company Act of 1940 as now in effect or as hereafter  amended subject,  however,
to such  exemptions as may be granted by the Securities and Exchange  Commission
by  any  rule,  regulation  or  order.  The  term  "vote  of a  majority  of the
outstanding  voting  securities" shall mean the vote of the lesser of (a) 67 per
centum or more of the shares of the Fund present or  represented by proxy at the
meeting if the holders of more than 50 per centum of the  outstanding  shares of
the Fund are present or represented by proxy at the meeting, or (b) more than 50
per centum of the outstanding shares of the Fund.


EATON VANCE ENHANCED EQUITY            EATON VANCE MANAGEMENT
INCOME FUND II


By: /s/ Duncan W. Richardson           By: /s/ Jeffrey P. Beale
    -------------------------------        -----------------------------------
    President, and not Individually        Vice President, and not Individually






                                       4

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(K)(4)
<SEQUENCE>12
<FILENAME>b52674a1exv99wxkyx4y.txt
<DESCRIPTION>EX-99.(K)(4) SHAREHOLDER SERVICING AGREEMENT
<TEXT>
<PAGE>

                                                                  EXHIBIT (K)(4)

                                      FORM

                                       OF

                         SHAREHOLDER SERVICING AGREEMENT

                  SHAREHOLDER SERVICING AGREEMENT (the "Agreement"), dated as of
[ ], 2005, between Eaton Vance Management ("Eaton Vance") and UBS Securities LLC
("UBS Securities").

                  WHEREAS, Eaton Vance Enhanced Equity Income Fund II (the
"Fund") is a closed-end, diversified management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), and its
shares of beneficial interest are registered under the Securities Act of 1933,
as amended; and

                  WHEREAS, Eaton Vance is the investment adviser and the
administrator of the Fund; and

                  WHEREAS, Eaton Vance desires to retain UBS Securities to
provide shareholder servicing and market information with respect to the Fund,
and UBS Securities is willing to render such services;

                  NOW, THEREFORE, in consideration of the mutual terms and
conditions set forth below, the parties hereto agree as follows:

         1.       Eaton Vance hereby employs UBS Securities, for the period and
                  on the terms and conditions set forth herein, to provide the
                  following services (the "Services"):

                  (a)      At the request of and as specified by Eaton Vance,
                           undertake to make available public information
                           pertaining to the Fund on an ongoing basis and to
                           communicate to investors and prospective investors
                           the Fund's features and benefits (including arranging
                           periodic seminars or conference calls for Eaton Vance
                           to communicate to investors, responding to questions
                           from current or prospective shareholders and
                           contacting specific shareholders, where appropriate),
                           provided that Services shall not include customary
                           market research information provided by UBS
                           Securities or its registered broker-dealer affiliates
                           in the ordinary course of their business.

                  (b)      At the request of and as specified by Eaton Vance,
                           make available to investors and prospective investors
                           market price, net asset value, yield and other
                           information regarding the Fund (provided that
                           Services shall not include customary market research
                           information provided by UBS Securities or its
                           registered broker-dealer affiliates in the ordinary
                           course of their business), if reasonably
<PAGE>
                           obtainable, for the purpose of maintaining the
                           visibility of the Fund in the investor community.

                  (c)      At the request of Eaton Vance or the Fund, provide
                           certain economic research and statistical information
                           and reports, if reasonably obtainable, to Eaton Vance
                           or the Fund and consult with representatives of Eaton
                           Vance and/or Trustees of the Fund in connection
                           therewith, which information and reports shall
                           include: (i) statistical and financial market
                           information with respect to the Fund's market
                           performance; and (ii) comparative information
                           regarding the Fund and other closed-end management
                           investment companies with respect to (x) the net
                           asset value of their respective shares, (y) the
                           respective market performance of the Fund and such
                           other companies, and (z) other relevant performance
                           indicators. Except as legally required, such
                           information and reports may not be quoted or referred
                           to, orally or in writing, reproduced or disseminated
                           by the Fund or any of its affiliates or any of their
                           agents, without the prior written consent of UBS
                           Securities, which consent will not be unreasonably
                           withheld.

                  (d)      At the request of Eaton Vance or the Fund, provide
                           information to and consult with Eaton Vance and/or
                           the Board of Trustees of the Fund with respect to
                           applicable strategies designed to address market
                           value discounts, which may include share repurchases,
                           tender offers, modifications to dividend policies or
                           capital structure, repositioning or restructuring of
                           the Fund, conversion of the Fund to an open-end
                           investment company, liquidation or merger; including
                           providing information concerning the use and impact
                           of the above strategic alternatives by other market
                           participants.

                  (e)      At the request of Eaton Vance or the Fund, UBS
                           Securities shall limit or cease any action or service
                           provided hereunder to the extent and for the time
                           period requested by Eaton Vance or the Fund;
                           provided, however, that pending termination of this
                           Agreement as provided for in Section 5 hereof, any
                           such limitation or cessation shall not relieve Eaton
                           Vance of its payment obligations pursuant to Section
                           2 hereof.

                  (f)      UBS Securities will promptly notify Eaton Vance or
                           the Fund, as the case may be, if it learns of any
                           material inaccuracy or misstatement in, or material
                           omission from, any written information provided by
                           UBS Securities to Eaton Vance or the Fund in
                           connection with the performance of Services by UBS
                           Securities under this Agreement. UBS Securities
                           acknowledges that in performing the Services under
                           this Agreement, it will
<PAGE>
                           comply in all material respects with all applicable
                           laws, rules and regulations.

         2.       Eaton Vance will pay UBS Securities a fee computed daily and
                  payable quarterly at an annualized rate of 0.10% of the
                  average daily gross assets of the Fund; provided, however,
                  that the fee payable hereunder by Eaton Vance to UBS
                  Securities shall be reduced for the duration of any period
                  during which Eaton Vance voluntarily agrees to reduce or limit
                  the management fee payable to it by the Fund under any
                  management contract with the Fund from time-to-time in effect
                  (provided, however, that the fee payable by Eaton Vance shall
                  not be reduced in connection with any contractual fee waiver
                  or expense reimbursement, which is disclosed in the prospectus
                  of the Fund). The reduced fee payable hereunder during any
                  such period shall be the percentage of the usual fee payable
                  hereunder equal to the percentage of the usual management fee
                  received by Eaton Vance after giving effect to the fee waiver
                  or limitation (i.e., if the management fee is effectively
                  reduced by 40% the fee hereunder also shall be reduced by
                  40%); provided further, that under no circumstances shall the
                  fee hereunder be reduced to less than zero for any period.
                  Fees payable hereunder shall be subject to the sales charge
                  limits of the National Association of Securities Dealer, Inc.,
                  and the total of all such fees shall not exceed [ ]% of the
                  aggregate offering price in the initial public offering of the
                  common shares of the Fund (the "Offering") (the "Maximum Fee
                  Amount").

         3.       Eaton Vance acknowledges that the Services of UBS Securities
                  provided for hereunder do not include any advice as to the
                  value of securities or regarding the advisability of
                  purchasing or selling any securities for the Fund's portfolio.
                  No provision of this Agreement shall be considered as
                  creating, nor shall any provision create, any obligation on
                  the part of UBS Securities, and UBS Securities is not hereby
                  agreeing, to: (i) furnish any advice or make any
                  recommendations regarding the purchase or sale of portfolio
                  securities or (ii) render any opinions, valuations or
                  recommendations of any kind or to perform any such similar
                  services in connection with providing the Services described
                  in Section 1 hereof, it being understood between the parties
                  hereto that any such advice, recommendations or such similar
                  activities if, and to the extent, agreed to be performed by
                  UBS Securities shall be the subject of a separate agreement
                  with Eaton Vance, including, but not limited to, separate
                  agreements with respect to any indemnification of UBS
                  Securities.

                  Except to the extent legally required (after consultation with
                  UBS Securities and its counsel, if reasonably possible),
                  neither (i) the name of UBS Securities nor (ii) any advice
                  rendered by UBS Securities to Eaton Vance or the Fund in
                  connection with the services performed by UBS Securities
                  pursuant to this Agreement will be quoted or referred to
                  orally or in writing, or in the case of (ii), reproduced or
                  disseminated, by the
<PAGE>
                  Fund or any of its affiliates or any of their agents, without
                  the prior written consent of UBS Securities, which consent
                  will not be unreasonably withheld.

         4.       Nothing herein shall be construed as prohibiting UBS
                  Securities or its affiliates from providing similar or other
                  services to any other clients (including other registered
                  investment companies or other investment advisers), so long as
                  Services provided by UBS Securities to Eaton Vance and the
                  Fund are not impaired thereby. In addition, nothing herein
                  shall be construed as prohibiting UBS Securities and its
                  affiliates, in the ordinary course of business, from trading
                  the securities of the Fund for its own account and for the
                  accounts of customers or from holding at any time a long or
                  short position in such securities. Neither this Agreement nor
                  the performance of the Services hereunder shall be considered
                  to constitute a partnership, association or joint venture
                  between UBS Securities and Eaton Vance. In addition, nothing
                  herein shall be construed to constitute UBS Securities as the
                  agent or employee of Eaton Vance or Eaton Vance as the agent
                  or employee of UBS Securities, and neither party shall make
                  any representation to the contrary.

         5.       This Agreement shall continue coterminously with and so long
                  as the Investment Advisory Agreement, dated [ ], 2005, remains
                  in effect between the Fund and Eaton Vance, or any similar
                  investment advisory agreement with a successor in interest or
                  affiliate of Eaton Vance remains in effect, as, and to the
                  extent, that such investment advisory agreement is renewed
                  periodically in accordance with the 1940 Act; provided,
                  however, that this Agreement shall automatically terminate if
                  further payments to UBS Securities would cause the total
                  amount of underwriting compensation in connection with the
                  Offering to exceed the Maximum Fee Amount. This Agreement may
                  not be assigned, except by operation of law or in connection
                  with the sale of all or substantially all of the assets or of
                  the equity securities of one of the parties hereto, without
                  the other party's prior consent.

         6.       Eaton Vance will furnish UBS Securities with such information
                  as UBS Securities believes appropriate to its assignment
                  hereunder (all such information so furnished being the
                  "Information"). Eaton Vance recognizes and confirms that UBS
                  Securities (a) will use and rely primarily on the Information
                  and on information available from generally recognized public
                  sources in performing the Services contemplated by this
                  Agreement without having independently verified the same and
                  (b) does not assume responsibility for the accuracy or
                  completeness of the Information and such other information.
                  The Information to be furnished by Eaton Vance when delivered,
                  will be true and correct in all material respects and will not
                  contain any material misstatement of fact or omit to state any
                  material fact necessary to make the statements contained
                  therein not misleading. Eaton Vance will promptly notify UBS
                  Securities if it
<PAGE>
                  learns of any material inaccuracy or misstatement in, or
                  material omission from, any Information delivered to UBS
                  Securities. UBS Securities acknowledges that certain of the
                  Information provided by Eaton Vance may be proprietary to
                  Eaton Vance and hereby agrees that it will not disclose (other
                  than as may be required by applicable law or regulatory
                  proceeding) to any third party any Information provided to UBS
                  Securities by Eaton Vance and specifically identified in
                  writing by Eaton Vance, prior to or at the time of its
                  delivery, as confidential or proprietary.

         7.       It is understood that UBS Securities is being engaged
                  hereunder as an independent contractor solely to provide the
                  Services described above to Eaton Vance and to the Fund and
                  that UBS Securities is not acting as a fiduciary of any
                  person, and shall have no duties or liability to the current
                  or future shareholders of Eaton Vance or any other third party
                  in connection with its engagement hereunder, all of which are
                  hereby expressly waived.

         8.       Eaton Vance agrees that UBS Securities shall have no liability
                  to Eaton Vance or the Fund for any act or omission to act by
                  UBS Securities in the course of its performance under this
                  Agreement, in the absence of bad faith, gross negligence or
                  willful misconduct on the part of UBS Securities. Eaton Vance
                  agrees to the indemnification and other agreements set forth
                  in the Indemnification Agreement attached hereto, the
                  provisions of which are incorporated herein by reference and
                  shall survive the termination, expiration or supersession of
                  this Agreement.

         9.       THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
                  OF THE STATE OF NEW YORK FOR CONTRACTS TO BE PERFORMED
                  ENTIRELY THEREIN AND WITHOUT REGARD TO THE CHOICE OF LAW
                  PRINCIPLES THEREOF.

         10.      EACH OF EATON VANCE AND UBS SECURITIES AGREE THAT ANY ACTION
                  OR PROCEEDING BASED HEREON, OR ARISING OUT OF UBS SECURITIES'
                  ENGAGEMENT HEREUNDER, SHALL BE BROUGHT AND MAINTAINED
                  EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK LOCATED IN
                  THE CITY AND COUNTY OF NEW YORK OR IN THE UNITED STATES
                  DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. EATON
                  VANCE AND UBS SECURITIES EACH HEREBY IRREVOCABLY SUBMIT TO THE
                  JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK LOCATED IN
                  THE CITY AND COUNTY OF NEW YORK AND OF THE UNITED STATES
                  DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE
                  PURPOSE OF ANY SUCH ACTION OR PROCEEDING AS SET FORTH ABOVE
                  AND IRREVOCABLY AGREE TO BE BOUND BY ANY JUDGMENT RENDERED
<PAGE>
                  THEREBY IN CONNECTION WITH SUCH ACTION OR PROCEEDING. EACH OF
                  EATON VANCE AND UBS SECURITIES HEREBY IRREVOCABLY WAIVE, TO
                  THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT
                  MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY
                  SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH REFERRED TO
                  ABOVE AND ANY CLAIM THAT ANY SUCH ACTION OR PROCEEDING HAS
                  BEEN BROUGHT IN AN INCONVENIENT FORUM.

         11.      Eaton Vance and UBS Securities each hereby irrevocably waive
                  any right they may have to a trial by jury in respect of any
                  claim based upon or arising out of this Agreement or the
                  transactions contemplated hereby.

         12.      This Agreement (including the attached Indemnification
                  Agreement) embodies the entire agreement and understanding
                  between the parties hereto and supersedes all prior agreements
                  and understandings relating to the subject matter hereof. If
                  any provision of this Agreement is determined to be invalid or
                  unenforceable in any respect, such determination will not
                  affect such provision in any other respect or any other
                  provision of this Agreement, which will remain in full force
                  and effect. This Agreement may not be amended or otherwise
                  modified or waived except by an instrument in writing signed
                  by both UBS Securities and Eaton Vance.

         13.      All notices required or permitted to be sent under this
                  Agreement shall be sent, if to Eaton Vance:

                                    Eaton Vance Corporation
                                    255 State Street
                                    Boston, MA  02109

                                    Attention: Chief Legal Officer

                  or if to UBS Securities:

                                    UBS Securities LLC
                                    299 Park Avenue
                                    New York, New York  10171

                                    Attention:  Syndicate Department

                  or such other name or address as may be given in writing to
                  the other parties. Any notice shall be deemed to be given or
                  received on the third day after deposit in the U.S. mail with
                  certified postage prepaid or when actually received, whether
                  by hand,
<PAGE>
                  express delivery service or facsimile transmission, whichever
                  is earlier.

         14.      This Agreement may be exercised on separate counterparts, each
                  of which is deemed to be an original and all of which taken
                  together constitute one and the same agreement.

         15.      A copy of the Agreement and Declaration of Trust of Eaton
                  Vance is on file with the Secretary of State of The
                  Commonwealth of Massachusetts, and notice hereby is given that
                  this Agreement is executed on behalf of the Trustees of Eaton
                  Vance as Trustees and not individually and that the
                  obligations or arising out of this Agreement are not binding
                  upon any of the Trustees or beneficiaries individually but are
                  binding only upon the assets and properties of Eaton Vance.
<PAGE>
                  IN WITNESS WHEREOF, the parties hereto have duly executed this
Shareholder Servicing Agreement as of the date first above written.

                                        EATON VANCE MANAGEMENT


                                        By: _____________________________
                                        Name:
                                        Title:


                                        UBS SECURITIES LLC


                                        By: _____________________________
                                        By:
                                        Title:

                                        By:  _____________________________
                                        By:
                                        Title:
<PAGE>
                  UBS Securities LLC Indemnification Agreement

                                                                       [ ], 2005

UBS Securities LLC
299 Park Avenue
New York, New York 10171

         In connection with the engagement of UBS Securities LLC ("UBS
Securities") to provide the Services to the undersigned (the "Company") as set
forth in the Shareholder Servicing Agreement dated [ ], 2005, between the
Company and UBS Securities (the "Agreement"), in the event that UBS Securities
becomes involved in any capacity in any claim, suit, action, proceeding,
investigation or inquiry (including, without limitation, any shareholder or
derivative action or arbitration proceeding) (collectively, a "Proceeding") (i)
in connection with or arising out of any untrue statement or alleged untrue
statement of a material fact contained in information with respect to the Fund
made public by or as authorized by the Fund (and not provided by UBS Securities)
or any omission or alleged omission to state therein a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading or (ii) otherwise in connection with or arising out of
the Agreement or the Services to be provided thereunder, the Company agrees to
indemnify, defend and hold UBS Securities harmless to the fullest extent
permitted by law, from and against any losses, claims, damages, liabilities and
expenses in connection with or arising out of the Agreement or the Services to
be provided thereunder (a "Covered Claim"), except, in the case of clause (ii)
above only, to the extent that it shall be determined by a court of competent
jurisdiction in a judgment that has become final in that it is no longer subject
to appeal or other review, that such losses, claims, damages, liabilities and
expenses resulted solely from the gross negligence, bad faith or willful
misconduct of UBS Securities. In addition, in the event that UBS Securities
becomes involved in any capacity in any Proceeding which relates to a Covered
Claim, the Company will reimburse UBS Securities for its legal and other
expenses (including the reasonable cost of any investigation and preparation) as
such expenses are incurred by UBS Securities in connection therewith. If such
indemnification were not to be available for any reason, the Company agrees to
contribute to the losses, claims, damages, liabilities and expenses involved (i)
in the proportion appropriate to reflect the relative benefits received or
sought to be received by the Company and its stockholders, on the one hand, and
UBS Securities, on the other hand, in the matters contemplated by the Agreement
or (ii) if (but only if and to the extent) the allocation provided for in clause
(i) is for any reason held unenforceable, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) but also the
relative fault of the Company and its stockholders, on the one hand, and the
party entitled to contribution, on the other hand, as well as any other relevant
equitable considerations; provided, that in no event shall the Company
contribute less than the amount necessary to assure that UBS Securities is not
liable for losses, claims, damages, liabilities and expenses in excess of the
amount of fees actually received by UBS Securities pursuant to the Agreement.
Relative fault shall be determined by reference to, among other things, whether
any alleged untrue statement or omission or
<PAGE>
any other alleged conduct relates to information provided by the Company or
other conduct by the Company (or its employees or other agents), on the one
hand, or by UBS Securities, on the other hand. The Company will not settle any
Proceeding in respect of which indemnity may be sought hereunder, whether or not
UBS Securities is an actual or potential party to such Proceeding, without UBS
Securities's prior written consent. For purposes of this Indemnification
Agreement, UBS Securities shall include UBS Securities LLC, any of its
affiliates, each other person, if any, controlling UBS Securities or any of its
affiliates, their respective officers, current and former directors, employees
and agents, and the successors and assigns of all of the foregoing persons. The
foregoing indemnity and contribution agreement shall be in addition to any
rights that any indemnified party may have at common law or otherwise.

         If any Proceeding is brought against UBS Securities in respect of which
indemnity may be sought against the Company pursuant to the foregoing paragraph,
UBS Securities shall promptly notify the Company in writing of the institution
of such Proceeding and the Company shall assume the defense of such Proceeding,
including the employment of counsel reasonably satisfactory to UBS Securities
and payment of all fees and expenses; provided, however, that the omission to so
notify the Company shall not relieve the Company from any liability which the
Company may have to UBS Securities or otherwise, unless and only to the extent
that, such omission results in the forfeiture of substantive rights or defenses
by the Company. UBS Securities shall have the right to employ its own counsel in
any such case, but the fees and expenses of such counsel shall be at the expense
of UBS Securities unless the employment of such counsel shall have been
authorized in writing by the Company in connection with the defense of such
Proceeding or the Company shall not have, within a reasonable period of time in
light of the circumstances, employed counsel to have charge of the defense of
such Proceeding or UBS Securities shall have reasonably concluded that there may
be defenses available to it which are different from, additional to or in
conflict with those available to the Company (in which case the Company shall
not have the right to direct the defense of such Proceeding on behalf of UBS
Securities), in any of which events such fees and expenses shall be borne by the
Company and paid as incurred (it being understood, however, that the Company
shall not be liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction). The Company shall not be liable for any
settlement of any Proceeding effected without its written consent but if settled
with the written consent of the Company, the Company agrees to indemnify and
hold harmless UBS Securities from and against any loss or liability by reason of
such settlement. Notwithstanding the foregoing sentence, if at any time UBS
Securities shall have requested the Company to reimburse UBS Securities for fees
and expenses of counsel as contemplated by the second sentence of this
paragraph, then the Company agrees that it shall be liable for any settlement of
any Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by the Company of the
aforesaid request, (ii) the Company shall not have reimbursed UBS Securities in
accordance with such request prior to the date of such settlement and (iii) UBS
Securities shall have given the Company at least 30 days' prior notice of its
intention to settle.
<PAGE>
         The Company agrees that neither UBS Securities nor any of its
affiliates, directors, agents, employees or controlling persons shall have any
liability to the Company or any person asserting claims on behalf of or in right
of the Company in connection with or as a result of a Covered Claim, except to
the extent that it shall be determined by a court of competent jurisdiction in a
judgment that has become final in that it is no longer subject to appeal or
other review that any losses, claims, damages, liabilities or expenses incurred
by the Company resulted solely from the gross negligence, bad faith or willful
misconduct of UBS Securities in performing the Services.

                  THIS INDEMNIFICATION AGREEMENT AND ANY CLAIM, COUNTERCLAIM OR
DISPUTE OF ANY KIND OR NATURE WHATSOEVER ARISING OUT OF OR IN ANY WAY RELATING
TO THIS AGREEMENT ("CLAIM"), DIRECTLY OR INDIRECTLY, SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS SET
FORTH BELOW, NO CLAIM MAY BE COMMENCED, PROSECUTED OR CONTINUED IN ANY COURT
OTHER THAN THE COURTS OF THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF
NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK, WHICH COURTS SHALL HAVE EXCLUSIVE JURISDICTION OVER THE ADJUDICATION OF
SUCH MATTERS, AND THE COMPANY AND UBS SECURITIES CONSENT TO THE JURISDICTION OF
SUCH COURTS AND PERSONAL SERVICE WITH RESPECT THERETO. THE COMPANY HEREBY
CONSENTS TO PERSONAL JURISDICTION, SERVICE AND VENUE IN ANY COURT IN WHICH ANY
CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT IS BROUGHT BY AND
THIRD PARTY AGAINST UBS SECURITIES OR ANY INDEMNIFIED PARTY. EACH OF UBS
SECURITIES AND THE COMPANY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING
OR CLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR IN
ANY WAY RELATING TO THIS AGREEMENT. THE COMPANY AGREES THAT A FINAL JUDGMENT IN
ANY PROCEEDING OR CLAIM ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT
BROUGHT IN ANY SUCH COURT SHALL BE CONCLUSIVE AND BINDING UPON THE COMPANY AND
MAY BE ENFORCED IN ANY OTHER COURTS TO THE JURISDICTION OF WHICH THE COMPANY IS
OR MAY BE SUBJECT, BY SUIT UPON SUCH JUDGMENT.
<PAGE>
                  The foregoing Indemnification Agreement shall remain in full
force and effect notwithstanding any termination of UBS Securities's engagement.
This Indemnification Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which shall constitute one and
the same agreement.

                                       Very truly yours,

                                       EATON VANCE MANAGEMENT


                                       By:      ___________________________
                                       Name:
                                       Title:


Accepted and agreed to as of the date first above written:

UBS SECURITIES LLC

By:      ___________________________
By:
Title:


By:      ___________________________
By:
Title:

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(K)(5)
<SEQUENCE>13
<FILENAME>b52674a1exv99wxkyx5y.txt
<DESCRIPTION>EX-99.(K)(5) FORM OF ADDITIONAL COMPENSATION AGREEMENT
<TEXT>
<PAGE>
                                                                  Exhibit (K)(5)


                                      FORM

                                       OF

                        ADDITIONAL COMPENSATION AGREEMENT



                                                               January [ ], 2005


Eaton Vance Management
255 State Street
Boston, MA  02109


Ladies and Gentlemen:

            Reference is made to the Underwriting Agreement dated January [ ],
2005 (the "Underwriting Agreement"), by and among Eaton Vance Enhanced Equity
Income Fund II a closed-end management investment company (the "Fund"), Eaton
Vance Management ("Eaton Vance" or the "Investment Adviser"), Rampart Investment
Management Company, Inc. and each of the respective Underwriters named therein,
with respect to the issue and sale of the Fund's common shares of beneficial
interest, par value $0.01 per share (the "Common Shares"), as described therein.
Reference is also made to (i) the Investment Advisory Agreement, dated [ ], 2005
(the "Investment Advisory Agreement") between Eaton Vance and the Fund and (ii)
the registration statement on Form N-2 regarding the Common Shares of the Fund
(the "Registration Statement"). Capitalized terms used herein and not otherwise
defined shall have the meanings given to them in the Underwriting Agreement.

            Eaton Vance hereby confirms its agreement with each Qualifying
Underwriter (as defined in Section 1 hereof) with respect to the additional
compensation referred to in the "Underwriting" section of the Registration
Statement, payable by Eaton Vance to each of the Qualifying Underwriters. Eaton
Vance agrees to pay to each Qualifying Underwriter additional compensation
(collectively, the "Additional Compensation") as provided for in Section 3
hereof; provided, however, that such Additional Compensation shall not exceed an
amount equal to 0.15% per annum of the aggregate average daily gross assets of
the Fund (including assets attributable to any preferred shares of the Fund that
may be outstanding); and provided, further, that such payments shall not exceed
the "Maximum Additional Compensation Amount" (as defined in Section 4 hereof).
The Additional Compensation shall be payable as set forth in Section 3 hereof.

            SECTION 1. Qualifying Underwriters. For the purposes of this
Additional Compensation Agreement, each Underwriter (other than UBS Securities
LLC), which sells Common Shares of the Fund with an aggregate purchase price to
the public of at least $50,000,000 shall be a "Class I Qualifying Underwriter"
and each Underwriter (other than UBS Securities LLC), which sells Common Shares
of the Fund with an aggregate purchase price to the public of at least
$100,000,000 shall be a "Class II Qualifying Underwriter;" provided, however,
that the amounts required to qualify as a Class I Qualifying Underwriter or a
Class II
<PAGE>
Qualifying Underwriter may be reduced with respect to any Underwriter in the
sole discretion of Eaton Vance. Class I Qualifying Underwriters and Class II
Qualifying Underwriters are referred to collectively herein as "Qualifying
Underwriters." A Qualifying Underwriter which qualifies as a Class II Qualifying
Underwriter shall not also be a Class I Qualifying Underwriter. Within 60 days
following the Closing Date, the Qualifying Underwriters shall prepare or cause
to be prepared and provide to Eaton Vance a chart listing each of the Qualifying
Underwriters, which chart shall indicate the aggregate purchase price to the
public of the Common Shares sold by each Qualifying Underwriter and the Pro Rata
Percentage (as defined in Section 2 hereof) of each Qualifying Underwriter and
shall be appended as Schedule A to this Additional Compensation Agreement. Such
Schedule A shall be prepared in good faith by the Qualifying Underwriters and
subject to verification by Eaton Vance.

            SECTION 2. Pro Rata Percentage. Each Qualifying Underwriter shall be
assigned a "Pro Rata Percentage," the numerator of which shall equal the
aggregate purchase price to the public of the Common Shares sold by such
Underwriter as set forth on Schedule A hereto and the denominator of which shall
equal the aggregate purchase price to the public of all of the Common Shares
purchased by the Underwriters pursuant to the Underwriting Agreement.

            SECTION 3. Payment of Additional Compensation.

      (a) Eaton Vance shall pay the Additional Compensation, quarterly in
arrears, to each Class I Qualifying Underwriter in an amount equal to the
product of such Qualifying Underwriter's Pro Rata Percentage multiplied by
0.0250% of the aggregate average daily gross assets of the Fund for such
quarter.

      (b) Eaton Vance shall pay the Additional Compensation, quarterly in
arrears, to each Class II Qualifying Underwriter in an amount equal to the
product of such Qualifying Underwriter's Pro Rata Percentage multiplied by
0.0375% of the aggregate average daily gross assets of the Fund for such
quarter.

      (c) All fees payable hereunder shall be paid to each Qualifying
Underwriter by wire transfer of immediately available funds within 15 days
following the end of each calendar quarter to a bank account designated by such
Qualifying Underwriter. At the time of each payment of Additional Compensation
hereunder, Eaton Vance shall deliver to each Qualifying Underwriter receiving an
installment of Additional Compensation a statement indicating the amount of the
of the aggregate average daily gross asset value of the Fund for such quarter
(including assets attributable to any preferred shares of the Fund that may be
outstanding) on which such payment was based.

      (d) The initial payments of Additional Compensation hereunder shall be
paid with respect to the calendar quarter ending March 31, 2005. In the event
that this Additional Compensation Agreement terminates prior to the end of a
calendar quarter, the Additional Compensation required to be paid hereunder
shall be due and payable within 15 days following the termination hereof and
shall be pro-rated in respect of the period prior to such termination.
Notwithstanding the foregoing, if any payment hereunder would otherwise fall on
a day which is not a business day, it shall be due on the next day which is a
business day. All fees payable
<PAGE>
hereunder shall be in addition to any fees paid by the Investment Adviser
pursuant to the Underwriting Agreement.

            SECTION 4. Maximum Additional Compensation Amount. The "Maximum
Additional Compensation Amount" payable by the Investment Adviser hereunder
shall be [ ]% of the aggregate offering price of the Common Shares. [ ] will
receive additional compensation which will not exceed [ ]% of the aggregate
initial offering price of the Common Shares and [ ] will received additional
compensation which will not exceed [ ]% of the aggregate initial offering price
of the Common Shares.

            SECTION 5. Term. This Additional Compensation Agreement shall
continue coterminously with and so long as the Investment Advisory Agreement,
dated [ ], 2005, remains in effect between the Fund and Eaton Vance, or any
similar investment advisory agreement with a successor in interest or affiliate
of Eaton Vance remains in effect, as, and to the extent, that such investment
advisory agreement is renewed periodically in accordance with the Investment
Company Act of 1940, as amended. This Additional Compensation Agreement shall
terminate on the earliest to occur of (a) with respect to any Qualifying
Underwriter, the payment by Eaton Vance to such Qualifying Underwriter of the
Maximum Additional Compensation Amount, (b) with respect to the Fund, the
dissolution and winding up of the Fund and (c) with respect to the Fund, the
date on which the Investment Advisory Agreement or other investment advisory
agreement between the Fund and Eaton Vance or any successor in interest to Eaton
Vance, including but not limited to an affiliate of Eaton Vance, shall
terminate.

            SECTION 6. Not an Investment Adviser. Eaton Vance acknowledges that
the Underwriters are not providing any advice hereunder as to the value of
securities or regarding the advisability of purchasing or selling any securities
for the Fund. No provision of this Additional Compensation Agreement shall be
considered as creating, nor shall any provision create, any obligation on the
part of any Underwriter, and the Underwriters are not hereby agreeing, to: (i)
furnish any advice or make any recommendations regarding the purchase or sale of
portfolio securities or (ii) render any opinions, valuations or recommendations
of any kind or to perform any such similar services.

            SECTION 7. Not Exclusive. Nothing herein shall be construed as
prohibiting any Underwriter or its respective affiliates from acting as such for
any other clients (including other registered investment companies or other
investment advisers).

            SECTION 8. No Liability. Eaton Vance agrees that no Underwriter
shall have liability to Eaton Vance or the Fund for any act or omission to act
by such Underwriter in the course of its performance under this Additional
Compensation Agreement, in the absence of gross negligence or willful misconduct
on the part of such Underwriter. Eaton Vance agrees to indemnify and hold
harmless each Underwriter and its respective officers, directors, agents and
employees against any loss or expense arising out of or in connection with such
Underwriter's performance under this Additional Compensation Agreement. This
provision shall survive the termination, expiration or supersession of this
Additional Compensation Agreement.
<PAGE>
            SECTION 9. Assignment. This Additional Compensation Agreement may
not be assigned by any party without the prior written consent of each other
party.

            SECTION 10. Amendment; Waiver. No provision of this Additional
Compensation Agreement may be amended or waived except by an instrument in
writing signed by the parties hereto.

            SECTION 11. Governing Law. This Additional Compensation Agreement
shall be governed by, and construed in accordance with, the laws of the State of
New York.

            SECTION 12. Counterparts. This Additional Compensation Agreement may
be executed in any number of counterparts, each of which shall be an original,
and all of which, when taken together, shall constitute one agreement. Delivery
of an executed signature page of this Additional Compensation Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof.
<PAGE>
            If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
Eaton Vance and the Qualifying Underwriters in accordance with its terms.

                                    Very truly yours,



                                    [ ]

                                    By:
                                          --------------------------------------
                                          Name:
                                          Title:


                                    [ ]

                                    By:
                                          --------------------------------------
                                          Name:
                                          Title:


CONFIRMED AND ACCEPTED,
as of the date first above written:


EATON VANCE MANAGEMENT


By:
      -----------------------------
      Name:
      Title:
<PAGE>
                                   SCHEDULE A




<TABLE>
<CAPTION>
                                                 AGGREGATE
                                          PURCHASE PRICE TO PUBLIC    PRO RATA
NAME OF QUALIFYING UNDERWRITER   CLASS     OF COMMON SHARES SOLD     PERCENTAGE
------------------------------   -----    ------------------------   ----------
<S>                              <C>      <C>                        <C>
[ ]                               [ ]               [ ]                   %
[ ]                               [ ]               [ ]                   %
</TABLE>






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(N)
<SEQUENCE>14
<FILENAME>b52674a1exv99wxny.txt
<DESCRIPTION>EX-99.(N) CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
<TEXT>
<PAGE>

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM'S CONSENT

We consent to the reference to our Firm under the heading "Independent
registered public accounting firm" in the Prospectus and Statement of Additional
Information in this Pre-Effective Amendment No. 1 to the Registration Statement
of Eaton Vance Enhanced Equity Income Fund II on Form N-2 filed by the Fund
under the Securities Act of 1933, as amended (Registration No. 333-120421) and
under the Investment Company Act of 1940, as amended (Registration No. 811
-21670).

/s/ Deloitte & Touche LLP
--------------------------
Boston, Massachusetts
December 20, 2004


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(S)
<SEQUENCE>15
<FILENAME>b52674a1exv99wxsy.txt
<DESCRIPTION>EX-99.(S) POWER OF ATTORNEY DATED DECEMBER 20, 2004
<TEXT>
<PAGE>
                                                                     EXHIBIT (s)

                                POWER OF ATTORNEY

     We, the  undersigned  officers and Trustees of Eaton Vance Enhanced  Equity
Income Fund II, a Massachusetts  business trust, do hereby severally  constitute
and appoint  Alan R.  Dynner,  Thomas E. Faust Jr.,  James B. Hawkes or James L.
O'Connor,  or any of them,  to be true,  sufficient  and  lawful  attorneys,  or
attorney  for each of us,  to sign for each of us,  in the name of each of us in
the  capacities  indicated  below,  Registration  Statements  and  any  and  all
amendments (including post-effective amendments) to such Registration Statements
on Form  N-2  filed by  Eaton  Vance  Enhanced  Equity  Income  Fund II with the
Securities  and  Exchange  Commission  in  respect  of any  class of  shares  of
beneficial interest and other documents and papers relating thereto.

     IN WITNESS WHEREOF we have hereunto set our hands on the dates set opposite
our respective signatures.

         Signature                        Title                        Date
         ---------                        -----                        ----

/s/ Duncan W. Richardson          President and Principal      December 20, 2004
-----------------------------       Executive Officer
Duncan W. Richardson

/s/ James L. O'Connor             Treasurer and Principal      December 20, 2004
------------------------------    Financial and Accounting
James L. O'Connor                         Officer

/s/ James B. Hawkes                       Trustee              December 20, 2004
------------------------------
James B. Hawkes

/s/ Samuel L. Hayes, III                  Trustee              December 20, 2004
------------------------------
Samuel L. Hayes, III

/s/ William H. Park                       Trustee              December 20, 2004
-----------------------------
William H. Park

/s/ Ronald A. Pearlman                    Trustee              December 20, 2004
-----------------------------
Ronald A. Pearlman

/s/ Norton H. Reamer                      Trustee              December 20, 2004
-----------------------------
Norton H. Reamer

/s/ Lynn A. Stout                         Trustee              December 20, 2004
-----------------------------
Lynn A. Stout

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>COVER
<SEQUENCE>16
<FILENAME>filename16.txt
<TEXT>
<PAGE>

Kirkpatrick & Lockhart LLP
75 State Street
Boston, MA 02109
Tel.: (617) 261-3187
Fax.: (617) 261-3175


December 21, 2004

VIA EDGAR

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C.  20549

       Re:      Eaton Vance Enhanced Equity Income Fund II
                Registration Statement on Form N-2 (333-120421; 811-21670)

Dear Mr. Di Stefano:

      Transmitted electronically with this letter for filing pursuant to the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, on behalf of Eaton Vance Enhanced Equity Income Fund II (the "Fund") is
Pre-Effective Amendment No. 1 to the Fund's registration statement on Form N-2
relating to Registrant's initial issuance of common shares of beneficial
interest, par value $.01 per share ("Pre-Effective Amendment No. 1").

      It is expected that the Fund will file a pre-effective amendment
responding to any comments and registering additional shares promptly after the
resolution of any comments, along with a request for acceleration of
effectiveness of the Registration Statement.

      Questions should be directed to the undersigned at (617) 261-3246.

                                                            Sincerely,

                                                            /s/ Clair E. Pagnano
                                                            --------------------
                                                            Clair E. Pagnano

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
