Taxable Fixed Income (Long-term)

Legg Mason Funds Sales Charge and Breakpoint Information

The information below relates to Class A, Class A2, Class B, Class C and Class C1 shares of Legg Mason funds. Please note that certain funds may not offer any or all of these share classes.

You should review the fund's prospectus before choosing your share class.

You may buy shares:

  • Through banks, brokers, dealers, insurance companies, investment advisers, financial consultants or advisers, mutual fund supermarkets and other financial intermediaries that have entered into an agreement with the distributor, Legg Mason Investor Services, LLC ("LMIS"), to sell shares of the fund (each called a "Service Agent")
  • Directly from the fund

Your Service Agent may provide shareholder services that differ from the services provided by other Service Agents. Services provided by your Service Agent may vary by class. You should ask your Service Agent to explain the shareholder services it provides for each class and the compensation it receives in connection with each class. Remember that your Service Agent may receive different compensation for selling one class of shares than for selling another class, which may depend on the policies, procedures and trading platforms of the Service Agent. Your Service Agent may not offer all classes of shares. You should contact your Service Agent for further information.


Legg Mason Funds Sales Charge and Breakpoint Schedules

The schedule below sets forth sales charge and, where applicable, breakpoint information for Class A, Class A2, Class B, Class C and Class C1 shares. Class B shares are not available for purchase by new or existing investors. Class C1 shares are not available for purchase by new or existing investors (except for certain retirement plan programs authorized by LMIS prior to August 1, 2012). Class B shares and Class C1 shares are available for dividend reinvestment and incoming exchanges. Class C shares and, as applicable, Class C1 and Class P shares are not available for purchases through or incoming exchanges from accounts where LMIS is the broker-dealer of record (“LMIS Accounts”).

 

 Value of sharesSales charge as a % of offering priceSales charge as a % of net amount investedService Agent commision as a % of offering priceMaximun portion of annual distribution and/or service fee paid to Service Agent

Contingent deferred sales charge (CSDC) (%)
(%)Timing
Class A & A2Less than $100,0004.254.444.000.25At purchaseNone
$100,000 - $249,9993.503.633.000.25At purchaseNone
$250,000 - $499,9992.502.562.000.25At purchaseNone
$500,000 - $749,9992.002.041.600.25At purchaseNone
$750,000 - $999,9991.501.521.200.25At purchaseNone
$1,000,000 - $4,999,999NoneNone0.750.2513th month after purchase1.00 (if redeemed within 18 months)
$5,000,000 - $14,999,999NoneNone0.500.2513th month after purchase1.00 (if redeemed within 18 months)
$15,000,000 - and overNoneNone0.250.2513th month after purchase1.00 (if redeemed within 18 months)
Class C1AnyNoneNone0.750.7013th month after purchase1.00 (if redeemed within 12 months)
Class CAnyNoneNone1.001.0013th month after purchase1.00 (if redeemed within 12 months)
Exception to schedule for Class C1 shares of Western Asset Global High Yield Bond Fund
Class C1AnyNoneNone1.000.7513th month after purchase1.00 (if redeemed within 12 months)
Exception to schedule for Class C1 shares of Western Asset Inflation Indexed Plus Bond Fund
Class C1AnyNoneNoneNone0.75At purchaseNone

More about sales charges

Class A and Class A2 shares

You buy Class A or Class A2 shares at the offering price, which is the net asset value plus a sales charge. You pay a lower rate as the size of your investment increases to certain levels called breakpoints. You do not pay a sales charge on the fund's distributions or dividends that you reinvest in additional Class A or Class A2 shares. As of December 1, 2015, sales charges on Class A shares will be waived for LMIS Accounts.

The schedule above shows the rate of sales charge you pay, depending on the amount you purchase. It also shows the amount of broker/dealer compensation that will be paid out of the sales charge if you buy shares from a Service Agent. For Class A or Class A2 shares sold by the distributor, the distributor will receive the sales charge imposed on purchases of Class A or Class A2 shares (or any contingent deferred sales charge paid on redemptions) and will retain the full amount of such sales charge. Service Agents will receive a distribution and/or service fee payable on Class A or Class A2 shares at an annual rate of up to 0.25% of the average daily net assets represented by the Class A or Class A2 shares serviced by them.


Qualifying for a reduced Class A or Class A2 sales charge

There are several ways you can combine multiple purchases of Class A or Class A2 shares of funds sold by the distributor to take advantage of the breakpoints in the sales charge schedule. In order to take advantage of reductions in sales charges that may be available to you when you purchase fund shares, you must inform your Service Agent or the fund if you are eligible for a letter of intent or a right of accumulation and if you own shares of other funds that are eligible to be aggregated with your purchases. Certain records, such as account statements, may be necessary in order to verify your eligibility for a reduced sales charge.


Accumulation Privilege

Sales charges are calculated based on the aggregate of purchases of Class A or Class A2 shares of a fund made at one time by any "person," which includes an individual and his or her spouse and children under the age of 21.

If you hold fund shares in accounts at two or more Service Agents, please contact your Service Agents to determine which shares may be combined.

Shares of money market funds sold by the distributor acquired by exchange from other funds offered with a sales charge may be combined. Shares of money market funds sold by the distributor that were not acquired by exchange from other funds offered with a sales charge may not be combined. Please contact your Service Agent or the fund for additional information.

Certain trustees and other fiduciaries may be entitled to combine accounts in determining their sales charge.


Letter of Intent

A Letter of Intent allows you to purchase Class A or Class A2 shares of funds sold by the distributor over a 13-month period and pay the same sales charge, if any, as if all shares had been purchased at once. At the time you enter into the letter of intent, you select your Asset Level Goal.

If you hold shares of funds sold by the distributor in accounts at two or more Service Agents, please contact your Service Agents to determine which shares may be credited toward your asset goal amount.

Each time you make a Class A or Class A2 purchase under a Letter of Intent, you will be entitled to the sales charge that is applicable to the amount of your Asset Level Goal.

Shares of money market funds sold by the distributor acquired by exchange from other funds offered with a sales charge may be credit toward your asset goal amount.

When you enter into a Letter of Intent, you agree to purchase in Eligible Accounts, as defined below, over a thirteen (13) month period Eligible Fund Purchases in an amount equal to the Asset Level Goal you have selected, less any Eligible Prior Purchases. For this purpose, shares are valued at the public offering price (including any sales charge paid) calculated as of the date of purchase, plus any appreciation in the value of the shares as of the date of calculation, except for Eligible Prior Purchases, which are valued at current value as of the date of calculation. Your commitment will be met if at any time during the 13-month period the value, as so determined, of eligible holdings is at least equal to your Asset Level Goal. All reinvested dividends and distributions on shares acquired under the Letter of Intent will be credited towards your Asset Level Goal. You may include any Eligible Fund Purchases towards the Letter of Intent, including shares of classes other than Class A or Class A2 shares. However, a Letter of Intent will not entitle you to a reduction in the sales charge payable on any shares other than Class A or Class A2 shares, and if the shares are subject to a contingent deferred sales charge, you will still be subject to that contingent deferred sales charge with respect to those shares. You must make reference to the Letter of Intent each time you make a purchase under the Letter of Intent.


Eligible Fund Purchases

Generally, any shares of a fund sold by the distributor may be credited towards your Asset Level Goal. Shares of certain money market funds acquired by exchange from other funds offered with a sales charge and sold by the distributor may be credited toward your Asset Level Goal.

The eligible funds may change from time to time. Investors should check with their Service Agent to see which funds may be eligible.


Eligible Accounts

Purchases may be made through any account in your name, or in the name of your spouse or your children under the age of 21. You may need to provide certain records, such as account statements, in order to verify your eligibility for reduced sales charges. Contact your Service Agent to see which accounts may be credited toward your Asset Level Goal.


Eligible Prior Purchases

You may also credit towards your Asset Level Goal any Eligible Fund Purchases made in Eligible Accounts at any time prior to entering into the Letter of Intent that have not been sold or redeemed, based on the current price of those shares as of the date of calculation.


Increasing the Amount of the Letter of Intent

You may at any time increase your Asset Level Goal. You must, however, contact your Service Agent, or if you purchase your shares directly through the transfer agent, contact the transfer agent, prior to making any purchases in an amount in excess of your current Asset Level Goal. Upon such an increase, you will be credited by way of additional shares at the then-current offering price for the difference between: (a) the aggregate sales charges actually paid for shares already purchased under the Letter of Intent and (b) the aggregate applicable sales charges for the increased Asset Level Goal. The 13-month period during which the Asset Level Goal must be achieved will remain unchanged.


Sales and Exchanges

Shares acquired pursuant to a Letter of Intent, other than Escrowed Shares as defined below, may be redeemed or exchanged at any time, although any shares that are redeemed prior to meeting your Asset Level Goal will no longer count towards meeting your Asset Level Goal. However, complete liquidation of purchases made under a Letter of Intent prior to meeting the Asset Level Goal will result in the cancellation of the Letter of Intent. See "Failure to Meet Asset Level Goal" below. Exchanges in accordance with the fund's Prospectus are permitted, and shares so exchanged will continue to count towards your Asset Level Goal, as long as the exchange results in an Eligible Fund Purchase.


Cancellation of the Letter of Intent

You may cancel a Letter of Intent by notifying your Service Agent in writing, or if you purchase your shares directly through the transfer agent, by notifying the transfer agent in writing. The Letter of Intent will be automatically cancelled if all shares are sold or redeemed as set forth above. See "Failure to Meet Asset Level Goal" below.

 

Escrowed Shares

Shares equal in value to five percent (5%) of your Asset Level Goal as of the date your Letter of Intent (or the date of any increase in the amount of the Letter of Intent) is accepted, will be held in escrow during the term of your Letter of Intent. The Escrowed Shares will be included in the total shares owned as reflected in your account statement and any dividends and capital gains distributions applicable to the Escrowed Shares will be credited to your account and counted towards your Asset Level Goal or paid in cash upon request. The Escrowed Shares will be released from escrow if all the terms of your Letter of Intent are met.


Failure to Meet Asset Level Goal

If the total assets under your Letter of Intent within its 13-month term are less than your Asset Level Goal whether because you made insufficient Eligible Fund Purchases, redeemed all of your holdings or cancelled the Letter of Intent before reaching your Asset Level Goal, you will be liable for the difference between: (a) the sales charge actually paid and (b) the sales charge that would have applied if you had not entered into the Letter of Intent. You may, however, be entitled to any breakpoints that would have been available to you under the accumulation privilege. An appropriate number of shares in your account will be redeemed to realize the amount due. For these purposes, by entering into a Letter of Intent, you irrevocably appoint your Service Agent, or if you purchase your shares directly through the transfer agent, the transfer agent, as your attorney-in-fact for the purposes of holding the Escrowed Shares and surrendering shares in your account for redemption. If there are insufficient assets in your account, you will be liable for the difference. Any Escrowed Shares remaining after such redemption will be released to your account.


Waivers for certain Class A or Class A2 investors

Initial Sales Charge Waivers 

Purchases of Class A or Class A2 shares may be made at NAV without an initial sales charge in the following circumstances:

  1. sales to (i) current and retired Board Members of any Legg Mason-sponsored fund, (ii) current employees of Legg Mason and its subsidiaries, (iii) the "immediate families" of such persons ("immediate families" are such person's spouse, including the surviving spouse of a deceased Board Member and children under the age of 21) and (iv) a pension, profit-sharing or other benefit plan for the benefit of such persons;
  2. sales to any employees of Service Agents having dealer, service or other selling agreements with the fund's distributor or otherwise having an arrangement with any such Service Agent with respect to sales of fund shares, and by the immediate families of such persons or by a pension, profit-sharing or other benefit plan for the benefit of such persons (providing the purchase is made for investment purposes and such securities will not be resold except through redemption or repurchase);
  3. offers of Class A or Class A2 shares to any other investment company to effect the combination of such company with the fund by merger, acquisition of assets or otherwise;
  4. purchases by shareholders who have redeemed Class A or Class A2 shares in the fund (or Class A or Class A2 shares of another fund sold by the distributor that is offered with a sales charge) and who wish to reinvest their redemption proceeds in the fund, provided the reinvestment is made within 60 calendar days of the redemption;
  5. purchases by certain separate accounts used to fund unregistered variable annuity contracts;
  6. purchases by investors participating in "wrap fee" or asset allocation programs or other fee-based arrangements sponsored by broker/dealers and other financial institutions that have entered into agreements with the distributor; 
  7. purchases by direct retail investment platforms through mutual fund "supermarkets," where the sponsor links its client's account (including IRA accounts on such platforms) to a master account in the sponsor's name; 
  8. sales through Service Agents who have entered into an agreement with LMIS to offer shares to self-directed investment brokerage accounts that may or may not charge a transaction fee to their customers;
  9. investors investing through certain retirement plans;
  10. investors who rollover fund shares from a qualified retirement plan into an individual retirement account administered on the same retirement plan platform; and 
  11. purchases of Class A shares by shareholders investing through LMIS Accounts.

For more information, please see the Appendix titled “Waivers and Discounts Available from Certain Service Agents” below. 

If you qualify for a waiver of the Class A or Class A2 initial sales charge, you must notify your Service Agent or the fund at 1-877-721-1926 at the time of purchase and provide sufficient information at the time of purchase to permit verification that the purchase qualifies for the initial sales charge waiver.

All existing retirement plan shareholders who purchased Class A shares at NAV prior to November 20, 2006, are permitted to purchase additional Class A shares at NAV. Certain existing programs for current and prospective retirement plan investors sponsored by financial intermediaries approved by the distributor prior to November 20, 2006 will also remain eligible to purchase Class A shares at NAV.

Appendix: Waivers and Discounts Available from Certain Service Agents

The availability of certain sales charge waivers and discounts will depend on whether you purchase your shares directly from the fund or through a financial intermediary. Intermediaries may have different policies and procedures regarding the availability of front-end sales load waivers or contingent deferred (back-end) sales load waivers, which are discussed below. In all instances, it is the purchaser’s responsibility to notify the fund or the purchaser’s financial intermediary at the time of purchase of any relationship or other facts qualifying the purchaser for sales charge waivers or discounts. For waivers and discounts not available through a particular intermediary, shareholders will have to purchase fund shares directly from the fund or through another intermediary to receive these waivers or discounts.  Effective April 10, 2017, shareholders purchasing fund shares through a Merrill Lynch platform or account will be eligible only for the following load waivers (front-end sales charge waivers and contingent deferred, or back-end, sales charge waivers) and discounts, which may differ from those disclosed elsewhere in the Prospectus or SAI. 

MERRILL LYNCH (EFFECTIVE APRIL 10, 2017)

Initial sales charge waivers on Class A shares

Investors purchasing Class A shares of the fund through a Merrill Lynch, Pierce, Fenner & Smith Incorporated platform or account (“Merrill Lynch Accounts”) are eligible for a waiver of the initial sales load on certain purchases of Class A shares that may differ from others described in the Prospectus. Merrill Lynch Accounts that are eligible for the waiver include: (i) employer-sponsored retirement, deferred compensation and employee benefit plans (including health savings accounts) and trusts used to fund those plans, provided that the shares are not held in a commission-based brokerage account and shares are held for the benefit of the plan; (ii) shares purchased by or through a Section 529 plan; (iii) shares purchased through a Merrill Lynch affiliated investment advisory program; (iv) shares purchased by third-party investment advisers on behalf of their advisory clients through Merrill Lynch’s platform; (v) shares of funds purchased through the Merrill Edge Self-Directed platform; (vi) shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family); (vii) shares exchanged from Class C (i.e., level-load) shares of the same fund in the month of or following the 10-year anniversary of the purchase date; (viii) employees and registered representatives of Merrill Lynch or its affiliates and their family members; (ix) Directors or Trustees of the fund, and employees of the fund’s investment adviser or any of its affiliates, as described in the Prospectus; and (x) shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement).

Contingent deferred sales charge waivers on Class A and C Shares available at Merrill Lynch

Investors holding shares subject to a contingent deferred sales charge through Merrill Lynch Accounts are eligible for a waiver of the contingent deferred sales charge on the redemption of shares: (i) due to the death or disability of the shareholder; (ii) as part of a systematic withdrawal plan as described in the Prospectus; (iii) due to the return of excess contributions from an IRA Account; (iv) as part of a required minimum distribution for IRAs and retirement accounts due to the shareholder reaching age 70 1/2; (v) sold to pay Merrill Lynch fees but only if the transaction is initiated by Merrill Lynch; (vi) acquired through the Right of Reinstatement; and (vii) held in retirement brokerage accounts that are exchanged for a lower cost share class due to transfer to certain fee based accounts or platforms (applicable only to Class A shares and Class C shares).

Front-end load discounts on Class A shares

The following discounts are available on purchases of Class A shares through Merrill Lynch Accounts: (i) breakpoints in the Class A sales charge schedule described in the Prospectus; (ii) rights of accumulation (ROA), which entitle shareholders to breakpoint discounts, will be automatically calculated based on the aggregated holdings of fund family assets held by accounts within the purchaser’s household at Merrill Lynch; eligible fund family assets not held at Merrill Lynch may be included in the ROA calculation only if the shareholder notifies his or her financial adviser about such assets; and (iii) letters of intent (LOI), which allow for breakpoint discounts based on anticipated purchases within a fund family, through Merrill Lynch, over a 13-month period of time.

Class A or Class A2 (as applicable) Sales Charge Waivers Available Only Through Certain Service Agents

Class A or Class A2 shares may be purchased at net asset without a sales charge by employees of any Service Agents that offer this waiver to their employees or employee-related accounts.

Class B shares

Class B shares are not available for purchase by new or existing investors. If you own Class B shares, you may continue to hold those shares, but you may not add to your Class B share position except through dividend reinvestment. Class B shares are also available for incoming exchanges. Class B shares are issued at net asset value with no initial sales charge. If you redeem your Class B shares within five years of your purchase payment, you will pay a contingent deferred sales charge based on the schedule of the fund that you originally purchased. The contingent deferred sales charge decreases as the number of years since your purchase payment increases.

 

Year after purchaseAsset Class1st2nd3rd4th5th6th through 8th
Contingent deferred sales charge (%)Fixed income4.543210
Equity543210

Class B shares conversion

After approximately 8 years, Class B shares automatically convert into Class A shares. This helps you because Class A shares have lower annual expenses. Your Class B shares will convert to Class A shares as follows:

 

Shares issued: at initial purchaseShares issued: on reinvestment of dividends and distributionsShares issued: upon exchange from another fund sold by the distributor
Approximately 8 years after the date of purchaseIn same proportion as the number of Class B shares converting is to total Class B shares you own (excluding shares issued as dividends)On the date the shares originally acquired would have converted into Class A shares

Class C shares

You buy Class C shares at net asset value with no initial sales charge. However, if you redeem your Class C shares within one year of purchase, you will pay the contingent deferred sales charge, if any, noted in the Class C schedule above. Class C shares are not available for purchase through LMIS Accounts.

The distributor generally will pay Service Agents selling Class C shares the commission, if any, noted in the Class C schedule above. Commissions are a percentage of the purchase price of the Class C shares they sell. The distributor will retain the contingent deferred sales charges, if any, and the annual distribution and/or service fee, if any, noted in the Class C schedule above. Distribution and/or service fees are a percentage of the average daily net assets represented by the Class C shares serviced by these Service Agents until the thirteenth month after purchase. Starting in the thirteenth month after purchase, these Service Agents will receive the annual distribution and/or service fee, if any, noted in the Class C schedule above, which is based on a percentage of the average daily net assets represented by the Class C shares serviced by them.


Class C1 shares

Class C1 shares are not available for purchase by new or existing investors (except for certain retirement plan programs authorized by the distributor prior to August 1, 2012). Class C1 shares are available for dividend reinvestment and incoming exchanges, except from LMIS Accounts. You buy Class C1 shares at net asset value with no initial sales charge. However, if you redeem your Class C1 shares within one year of purchase, you will pay the contingent deferred sales charge, if any, noted in the Class C1 schedule above.

Prior to August 1, 2012, the distributor generally paid Service Agents selling Class C1 shares the commission, if any, noted in the Class C1 schedule above. Commissions were a percentage of the purchase price of the Class C1 shares they sold. The distributor will retain the contingent deferred sales charges, if any, and the annual distribution and/or service fee, if any, noted in the Class C1 schedule above. Distribution and/or service fees are a percentage of the average daily net assets represented by the Class C1 shares serviced by these Service Agents until the thirteenth month after purchase. Starting in the thirteenth month after purchase, these Service Agents will receive the annual distribution and/or service fee, if any, noted in the Class C1 schedule above, which is based on a percentage of the average daily net assets represented by the Class C1 shares serviced by them.


More about contingent deferred sales charges

The contingent deferred sales charge is based on the net asset value at the time of purchase or redemption, whichever is less, and therefore you do not pay a sales charge on amounts representing appreciation or depreciation.

In addition, you do not pay a contingent deferred sales charge:

  • When you exchange shares for shares of another fund sold by the distributor
  • On shares representing reinvested distributions and dividends
  • On shares no longer subject to the contingent deferred sales charge

In determining the applicability of any contingent deferred sales charge, it will be assumed that a redemption is made first of shares representing capital appreciation, next of shares representing the reinvestment of dividends and capital gain distributions, next of shares that are not subject to the contingent deferred sales charge and finally of other shares held by the shareholder for the longest period of time. The length of time that contingent deferred sales charge shares acquired through an exchange have been held will be calculated from the date the shares exchanged were initially acquired in one of the other funds sold by the distributor. For federal income tax purposes, the amount of the contingent deferred sales charge will reduce the gain or increase the loss, as the case may be, on the amount realized on redemption.

If you redeem shares of a fund sold by the distributor and pay a contingent deferred sales charge, you may, under certain circumstances, reinvest all or part of the redemption proceeds within 60 days and receive pro rata credit for any contingent deferred sales charge imposed on the prior redemption. Please contact your Service Agent for additional information. The distributor receives contingent deferred sales charges as partial compensation for its expenses in selling shares, including the payment of compensation to your Service Agent.

The contingent deferred sales charge will be waived on:

  • exchanges;
  • automatic cash withdrawals in amounts equal to or less than 2.00% per month of the shareholder's account balance at the time the withdrawals commence, up to a maximum of 12.00% in one year;
  • redemptions of shares within 12 months following the death or disability (as defined by the Internal Revenue Code of 1986, as amended) of the shareholder;
  • mandatory post-retirement distributions from retirement plans or IRAs commencing on or after attainment of age 70 1 /2 (except that shareholders who had opened accounts prior to May 23, 2005, will be "grandfathered" and will be eligible to obtain the waiver at age 59 1 /2 by demonstrating such eligibility at the time of redemption);
  • involuntary redemptions;
  • redemptions of shares to effect a combination of the fund with any investment company by merger, acquisition of assets or otherwise;
  • tax-free returns of an excess contribution to any retirement plan; 
  • certain redemptions of shares of the fund in connection with lump-sum or other distributions made by eligible retirement plans or redemption of shares by participants in certain "wrap fee" or asset allocation programs sponsored by broker/dealers and other financial institutions that have entered into agreements with the distributor or the manager; and
  • Class A shares held through LMIS Accounts.

Other things to know

Buying shares

Generally You may buy shares at their net asset value next determined after receipt by your Service Agent or the transfer agent of your purchase request in good order, plus any applicable sales charge.  The fund may not be available for sale in certain states. 

Prospective investors should inquire as to whether the fund is available for sale in their state of residence.

Buying shares through a systematic investment plan

Shareholders may purchase additional Class A, Class A2 and Class C shares of the fund through a service known as the Systematic Investment Plan. You may authorize your Service Agent or the transfer agent to transfer funds automatically from (i) a regular bank account, (ii) cash held in a brokerage account with a Service Agent or (iii) certain money market funds, in order to buy shares on a regular basis. Amounts transferred must meet the applicable minimums. Amounts may be transferred monthly, every alternate month, quarterly, semiannually or annually. A shareholder who has insufficient funds to complete a pre-authorized transfer may be charged a fee by a Service Agent or the transfer agent. Additional information is available from the fund or a Service Agent.


Exchanging shares

Generally You may exchange shares of the fund for the same class of shares of other funds sold by the distributor on any day that both the fund and the fund into which you are exchanging are open for business. For investors who qualify as Clients of Eligible Financial Intermediaries (as defined in the fund's prospectus) and participate in Eligible Investment Programs (as defined in the fund's prospectus) made available through their financial intermediaries (such as investors in fee-based advisory or mutual fund "wrap" programs), an exchange may be made from Class A, Class A2, Class C or Class C1 shares to Class I shares of the same fund under certain limited circumstances. 

If you hold Class C1 shares, you may exchange those shares for Class C1 shares of other funds sold by the distributor, or if a fund does not offer Class C1, for Class C shares. However, once you exchange Class C1 shares for Class C shares, you would not be permitted to exchange from Class C shares back to Class C1 shares.

Investors that hold Class A2 shares may exchange those shares for Class A2 shares of other funds sold by a Service Agent with a direct transfer agent relationship with such funds, or if such fund does not offer Class A2, for Class A shares.

An exchange of shares of one fund for shares of another fund is considered a sale and generally results in a capital gain or loss for federal income tax purposes, unless you are investing through an IRA, 401(k) or other tax-advantaged account. An exchange of shares of one class directly for shares of another class of the same fund normally should not be taxable for federal income tax purposes. You should talk to your tax advisor before making an exchange.

The exchange privilege is not intended as a vehicle for short-term trading. The fund may suspend or terminate your exchange privilege if you engage in a pattern of excessive exchanges.

You may exchange shares at their net asset value next determined after receipt by your Service Agent or the transfer agent of your exchange request in good order.

  • If you bought shares through a Service Agent, contact your Service Agent to learn which funds your Service Agent makes available to you for exchanges
  • If you bought shares directly from the fund, contact the fund at 1-877-721-1926 to learn which funds are available to you for exchanges
  • Exchanges may be made only between accounts that have identical registrations
  • Not all funds offer all classes
  • Funds that offer Class B shares may continue to make them available for incoming exchanges
  • Some funds are offered only in a limited number of states. Your Service Agent or the fund will provide information about the funds offered in your state

Always be sure to read the prospectus of the fund into which you are exchanging shares.


Investment minimums, sales charges and other requirements

In most instances, your shares will not be subject to an initial sales charge or a contingent deferred sales charge at the time of the exchange. You may be charged an initial or contingent deferred sales charge if the shares being exchanged were not subject to a sales charge. Except as noted above, your contingent deferred sales charge (if any) will continue to be measured from the date of your original purchase of shares subject to a contingent deferred sales charge, and you will be subject to the contingent deferred sales charge of the fund that you originally purchased. You will generally be required to meet the minimum investment requirement for the class of shares of the fund or share class into which your exchange is made (except in the case of systematic exchange plans).  Your exchange will also be subject to any other requirements of the fund or share class into which you are exchanging shares.  The fund may suspend or terminate your exchange privilege if you engage in a pattern of excessive exchanges.

Exchanging shares through a systematic exchange plan

You may be permitted to schedule automatic exchanges of shares of the fund for shares of other funds available for exchange. All requirements for exchanging shares described above apply to these exchanges. In addition:

  • Exchanges may be made monthly, every alternate month, quarterly, semi-annually or annually
  • Each exchange must meet the applicable investment minimums for systematic investment plans


Redeeming shares

Systematic cash withdrawal plans

You may be permitted to schedule automatic redemptions of a portion of your shares. To qualify, you must own shares of the fund with a value of at least $10,000 ($5,000 for Retirement Plan accounts) and each automatic redemption must be at least $50.

The following conditions apply:

  • Redemptions may be made monthly, every alternate month, quarterly, semiannually or annually
  • If your shares are subject to a contingent deferred sales charge, the charge will be required to be paid upon redemption. However, the charge will be waived if your automatic redemptions are equal to or less than 2% per month of your account balance on the date the redemptions commence, up to a maximum of 12% in one year
  • You must elect to have all dividends and distributions reinvested

An automatic cash withdrawal plan (the "Withdrawal Plan") is available to shareholders as described in the fund's Prospectus. To the extent withdrawals under the Withdrawal Plan exceed dividends, distributions and appreciation of a shareholder's investment in the fund, there will be a reduction in the value of the shareholder's investment, and continued withdrawal payments may reduce the shareholder's investment and ultimately exhaust it. Withdrawal payments should not be considered as income from investment in the fund. The Withdrawal Plan will be carried over on exchanges between funds or, if permitted, between classes of the fund. All dividends and distributions on shares in the Withdrawal Plan are reinvested automatically at net asset value in additional shares of the fund.

For additional information shareholders should contact their Service Agents. A shareholder who purchases shares directly through the transfer agent may continue to do so and applications for participation in the Withdrawal Plan should be sent to the transfer agent. Withdrawals may be scheduled on any day of the month; however, if the shareholder does not specify a day, the transfer agent will schedule the withdrawal on the 25th day (or the next business day if the 25th day is a weekend or holiday) of the month.