United States
Securities and Exchange Commission
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)
Putnam Dividend Income Fund
(Name of Issuer)
Common Stock
(Title of Class of Securities)
746706-10-0
(CUSIP Number)
The Commerce Group Inc.
211 Main Street
Webster, MA 01570
(508) 943-9000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 11, 2001
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check
the following box: [X]
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of
the Act (however, see the Notes).
Page 1 of 13
CUSIP No.: 746706-10-0 THE COMMERCE GROUP, INC.
SCHEDULE 13D
AMENDMENT NO. 4
APRIL 11, 2001
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. ID NO. OF ABOVE PERSON
The Commerce Group, Inc.
ID# 04-2599931
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS [WC]
5 CHECK BOX IF DISCLOSURE OF LEGAL [ ]
PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
SOLE VOTING POWER 5,420,950
SHARED VOTING POWER 0
SOLE DISPOSITIVE POWER 5,420,950
SHARED DISPOSITIVE POWER 0
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,420,950
12. CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
50.1%
14. TYPE OF REPORTING PERSON
[HC]
Page 2 of 13
CUSIP No.: 746706-10-0 THE COMMERCE GROUP, INC.
SCHEDULE 13D
AMENDMENT NO. 4
APRIL 11, 2001
ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to the shares of beneficial interest (the
"Shares"), of Putnam Dividend Income Fund (the "Fund"), a Massachusetts
business trust registered as an investment company under the Investment
Company Act of 1940, as amended (the "Investment Company Act"). The
principal executive offices of the Fund are located at One Post Office
Square, Boston, MA.
ITEM 2. IDENTITY AND BACKGROUND
(a) - (c) This Schedule 13D is being filed by The Commerce Group,
Inc. (the "Reporting Person"), a corporation formed under the laws of
Massachusetts. The Reporting Person is a corporation whose principal
offices are located at 211 Main Street Webster, MA 01570. The name,
business address and principal occupation of each director and executive
officer of the Reporting Person are set forth on Annex A hereto, which is
incorporated by reference. All information in this Schedule 13D with
respect to the persons listed on Annex A is given to the knowledge of the
Reporting Person.
(d) During the past five years, neither the Reporting Person nor any
of the persons listed on Annex A has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors).
(e) During the past five years, neither the Reporting Person nor any
of the persons listed on Annex A has been a party to a civil proceeding of
a judicial or administrative body of competent jurisdiction and as a
result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any
violation with respect to such laws.
(f) All of the individuals listed in Annex A are citizens of the
United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The source of the funds used by the Reporting Person to purchase
Shares listed in Item 5(a) was working capital. The amount of the funds
used to purchase such shares aggregated approximately $54,233,400.
Page 3 of 13
CUSIP No.: 746706-10-0 THE COMMERCE GROUP, INC.
SCHEDULE 13D
AMENDMENT No. 4
APRIL 11, 2001
ITEM 4. PURPOSE OF TRANSACTION
On April 6, 2001, the Board of Trustees of the Issuer announced that
it would immediately and completely liquidate the Fund and forcibly redeem
the interests of all shareholders. The announced plan of liquidation is
purportedly to be implemented without shareholder consideration, and will
result in a liquidating distribution to shareholders of record as of April
16, 2001. In its announcement, the Trustees conveyed that their decision
to liquidate the Fund was intended to prevent shareholders from replacing
the current Putnam trustees.
The Reporting Person, by letter dated, April 11, 2001 (Attached hereto
as Appendix A) has proposed to the Issuer that the Fund continue in
existence and that all shareholders, other than the Reporting Person, be
given the opportunity to be redeemed at net asset value, or to remain
invested in the Fund. The Reporting Person believes that the Trustees'
proposal would present shareholders with the risk of losing millions of
dollars in value, since the Putnam action calls for an immediate sale or
distribution of the Issuer's portfolio, regardless of current prices or
market conditions. The Trustees' action also fails to distribute to the
shareholders fair value for their pro rata share of the intangible assets
of the Fund.
The Reporting Person believes that it is inappropriate to force
shareholders of a closed-end fund to either (i) accept a redemption in
cash or securities, or (ii) exchange their interests into another Putnam
managed fund. Instead, the Reporting Person believes that the current
Trustees should reconsider the liquidation and permit shareholders to
retain their interests and to do so before beginning to liquidate the
Fund's assets. The Reporting Person had sought a meeting with the
Trustees for several weeks prior to their April 6 announcement but was not
given the opportunity to meet with them.
The Reporting Person is continuing to evaluate alternative actions,
including taking shareholder action to prevent or rescind the purported
liquidation, pursing legal or regulatory relief against the Issuer, its
trustees or the investment adviser to the Issuer, or making further
proposals.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) The Fund's reports with the Securities and Exchange Commission
report that 10,828,107 Shares are outstanding. Based upon such number,
the Reporting Person beneficially owns 50.1% of the Fund's outstanding
Shares.
Page 4 of 13
CUSIP No.: 746706-10-0 THE COMMERCE GROUP, INC.
SCHEDULE 13D
AMENDMENT No. 4
APRIL 11, 2001
The Reporting Person is the beneficial owner (through its insurance
subsidiaries as listed below) of 5,420,950 Shares, over which it has sole
power of disposition and voting. Such number of Shares represents
approximately 50.1% of the outstanding shares.
Shares Cost
The Commerce Insurance Company 4,860,950 $48,834,719
Citation Insurance Company 100,000 966,500
American Commerce Insurance Company 300,000 2,858,906
Commerce West Insurance Company 160,000 1,573,275
Totals 5,420,950 $54,233,400
(c) No purchases of shares of Common Stock have been effected
subsequent to March 31, 2001. Purchases prior to April 1, 2001, all of
which were made on the New York Stock Exchange, were reported on previous
Schedule 13D filings.
(d) No person other than the Reporting Person has the right to
receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, the shares of Common Stock owned by the
Reporting Person.
(e) It is inapplicable to state the date on which the Reporting
Person ceased to be the beneficial owner of more than five percent of the
Common Stock.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER
The Reporting Person does not have any contract, arrangement,
understanding or relationship (legal or otherwise) with any person with
respect to any securities of the Fund, including, but not limited to, the
transfer or voting of any such securities, finders' fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits,
division of profits or loss, or the giving or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Annex A Officers and Directors of Reporting Person and Insurance
Subsidiaries
Appendix A Letter to John A. Hill, Chairman of the Trustees of
Putnam Dividend
Income Fund
Page 5 of 13
CUSIP No.: 746706-10-0 THE COMMERCE GROUP, INC.
SCHEDULE 13D
AMENDMENT No. 4
APRIL 11, 2001
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
ARPIL 11, 2001 THE COMMERCE GROUP, INC.
Gerald Fels
Executive Vice President &
Chief Financial Officer
Page 6 of 13
ANNEX A
THE COMMERCE GROUP, INC.
DIRECTORS
Herman F. Becker......................... Owner of Sterling Realty and Huguenot
Development Corporation
Joseph A. Borski, Jr..................... Self-employed Certified Public Accountant
Eric G. Butler........................... Retired Vice President and General Claims Manager
of Commerce and Citation
Henry J. Camosse......................... Retired President, Henry Camosse & Sons Co., Inc.,
a building and masonry supplies company
Gerald Fels.............................. Executive Vice President and Chief Financial
Officer of the Company
David R. Grenon.......................... Chairman Emeritus and Assistant Clerk of The
Protector Group Insurance Agency, Inc.
Robert W. Harris......................... Retired Treasurer, H.C. Bartlett Insurance Agency,
Inc.
Robert S. Howland........................ Retired Clerk, H.C. Bartlett Insurance Agency,
Inc.
John J. Kunkel........................... President and Treasurer, Kunkel Buick and GMC
Truck; Treasurer, Kunkel Bus Company
Raymond J. Lauring....................... Retired President, Lauring Construction Company
Roger E. Lavoie.......................... Retired President and Treasurer, Lavoie Toyota-
Dodge, Inc.
Normand R. Marois........................ Retired Chairman of the Board, Marois Bros., Inc.,
a contracting firm
Suryakant M. Patel....................... Retired physician who specialized in internal
medicine
Arthur J. Remillard, Jr.................. President, Chief Executive Officer and Chairman
of the Board of the Company
Arthur J. Remillard, III................. Senior Vice President and Assistant Clerk of
the Company; Senior Vice President of Commerce
and Citation in charge of Policyholder Benefits
Regan P. Remillard....................... Senior Vice President of the Company; President
and Secretary of Commerce West Insurance Company;
President of ACIC Holding Co., Inc.; Vice Chairman
of the Board and Chief Executive Officer of
American Commerce Insurance Company
Gurbachan Singh.......................... Retired physician who specialized in general
surgery
John W. Spillane......................... Clerk of the Company and practicing attorney
Page 7 of 13
ANNEX A
DIRECTORS OF
COMMERCE HOLDINGS, INC.
The Commerce Insurance Company
Commerce West Insurance Company
Citation Insurance Company
Arthur J. Remillard, Jr........... President, Chief Executive Officer and Chairman of
the Board
Gerald Fels....................... Executive Vice President and Chief Financial Officer;
Treasurer, Commerce Holdings, Inc.
Arthur J. Remillard, III.......... Senior Vice President and Clerk
Regan P. Remillard................ Senior Vice President; President and Secretary of
Commerce West Insurance Company
James A. Ermilio.................. Vice President and General Counsel
David R. Grenon................... Chairman Emeritus and Assistant Clerk of The
Protector Group Insurance Agency
John M. Nelson.................... Chairman of Brown & Sharpe Mfg., Co.
Suryakant M. Patel................ Retired physician who specialized in internal
medicine
William G. Pike................... Executive Vice President and Chief Financial Officer
of Granite State Bankshares, Inc.
H. Thomas Rowles.................. Chairman of the Board of ACIC Holding Co., Inc.;
Chairman of the Board of American Commerce Insurance
Company; President, Chief Executive Officer and
Director of AAA Southern New England
Mark A. Shaw...................... Treasurer of ACIC Holding Co., Inc.; Executive Vice
President and Chief Operating Officer of AAA Southern
New England
Page 8 of 13
ANNEX A
DIRECTORS OF
American Commerce Insurance Company
H. Thomas Rowles.................. Chairman of the Board of ACIC Holding Co., Inc.;
Chairman of the Board of American Commerce Insurance
Company; President, Chief Executive Officer and
Director of AAA Southern New England
Regan P. Remillard................ President of ACIC Holding Co., Inc.; Vice Chairman of
the Board and Chief Executive Officer of American
Commerce Insurance Company; Senior Vice President of
The Commerce Group, Inc.; President and Secretary of
Commerce West Insurance Company
Mark A. Shaw...................... Treasurer of ACIC Holding Co., Inc.; Executive Vice
President and Chief Operating Officer of AAA Southern
New England
Gerald Fels....................... Executive Vice President and Chief Financial Officer
of The Commerce Group, Inc.
Patrick W. Doherty................ President and Chief Executive Officer of AAA Oklahoma
Terry R. Farias................... President and Chief Executive Officer of AAA Hoosier
Motor Club
Roger L. Graybeal................. President and Secretary of AAA Oregon/Idaho
Richard S. Hamilton............... President of AAA West Pennsylvania/West
Virginia/South Central Ohio
Gerald P. Hogan................... President and Chief Operating Officer of American
Commerce Insurance Company
Charles B. Liekweg................ President and Chief Executive Officer of AAA
Washington
D. James McDowell................. President and Chief Executive Officer of AAA Arizona
Peter C. Ohlheiser................ President of Ohio Motorists Association
Page 9 of 13
ANNEX A
THE COMMERCE GROUP, INC.
Officers of the Commerce Group, Inc.
President, Chief Executive Officer and Chairman of the Board..... Arthur J. Remillard, Jr.
Executive Vice President and Chief Financial Officer............. Gerald Fels
Senior Vice President and Assistant Clerk........................ Arthur J. Remillard, III
Senior Vice President............................................ Regan P. Remillard
Senior Vice President............................................ Mary M. Fontaine
Vice President and General Counsel............................... James A. Ermilio
Clerk............................................................ John W. Spillane
Treasurer and Chief Accounting Officer........................... Randall V. Becker
Assistant Treasurer.............................................. Thomas A. Gaylord
Assistant Vice President......................................... Robert E. McKenna
Officers of Massachusetts Subsidiaries
President, Chief Executive Officer and Chairman of the Board..... Arthur J. Remillard, Jr.
Executive Vice President and Chief Financial Officer............. Gerald Fels
Senior Vice President and Secretary.............................. Arthur J. Remillard, III
Senior Vice Presidents........................................... David H. Cochrane
Peter J. Dignan
Mary M. Fontaine
Regan P. Remillard
Joyce B. Virostek
Vice Presidents.................................................. Elizabeth M. Edwards
Karen A. Lussier
Michael J. Richards
Angelos Spetseris
Henry R. Whittier, Jr.
Vice President and General Counsel............................... James A. Ermilio
Assistant Vice Presidents.................. David P. Antocci Susan A. Horan
Robert M. Blackmer John V. Kelly
Stephen R. Clark Ronald J. Lareau
Raymond J. DeSantis Donald G. MacLean
Warren S. Ehrlich Robert E. McKenna
Richard W. Goodus Robert L. Mooney
James E. Gow Emile E. Riendeau
Treasurer and Chief Accounting Officer........................... Randall V. Becker
Assistant Treasurer.............................................. Thomas A. Gaylord
Page 10 of 13
ANNEX A
Officers of American Commerce Insurance Company
Chairman of the Board........................................... H. Thomas Rowles
Vice Chairman of the Board and Chief Executive Officer.......... Regan P. Remillard
President and Chief Operating Officer........................... Gerald P. Hogan
Senior Vice President and Chief Financial Officer............... Michael V. Vrban
Senior Vice President........................................... Carol R. Blaine
Treasurer....................................................... Richard B. O'Hara
Chief Legal Officer and Secretary............................... James A. Ermilio
Assistant Vice President........................................ Gregory S. Clark
Assistant Vice President, General Counsel, and
Assistant Secretary........................................... Julie Deley-Shimer
Page 11 of 13
APPENDIX A
THE COMMERCE GROUP, INC.
April 11, 2001
Via Facsimile and Overnight Mail
Mr. John A. Hill
Chairman of the Trustees
Putnam Dividend Income Fund
One Post Office Square
Boston, Massachusetts 02109
Dear Mr. Hill:
We are writing to request that you and the independent Trustees meet with
representatives of The Commerce Group, Inc. ("Commerce") to discuss the
interests of shareholders of the Putnam Dividend Income Fund. The purpose
of our meeting would be to discuss how Fund shareholders would be better
served by the Trustees' considering an alternative to the complete
liquidation of the Fund announced on Friday.
The context of our request is important to review. As you know, for several
years Commerce, with its affiliates, has held 30% or more of the outstanding
shares of Putnam Dividend Income Fund. Like other shareholders, Commerce
chose to invest in the Fund as a tax-efficient pooled investment vehicle,
and an alternative to redeemable open-end funds. In fact, Putnam long
advocated the closed-end structure as providing long-term value beyond the
day-to-day market price of its investments.
Over the past several weeks we have asked, but were not given the
opportunity, to meet with one or more Trustees of the Fund to discuss means
of furthering the interests of all shareholders. We have met with the
Fund's advisor. Over this time, we have become convinced that there remains
untapped value in the Fund, and that there are changes in structure and
strategy that would enhance that value. We strongly believe that the
announced plan of complete liquidation is not the best means to accomplish
that goal.
Instead, we are hereby proposing that the Fund continue in operation, with
shareholders (other than Commerce) being given the choice to (i) receive a
distribution of net asset value, in cash or in kind, or (ii) retain their
ownership in the Fund.
Page 12 of 13
Mr. John A. Hill
April 11, 2001
Page 2
We believe that this alternative satisfies the goals announced on Friday by
the Trustees, yet offers both large and small shareholders the opportunity
to maintain their chosen long-term strategy in a tax efficient manner.
Rather than a forced redemption of all shareholders in what may be an
inopportune market, and an unplanned taxable event to shareholders, our
proposal would offer shareholders the opportunity to continue having their
assets managed by Putnam Investment Management, or a successor. Further, it
allows current Trustees to offer an exit for those that choose liquidity,
rather than continue with potentially new trustees or fund management.
It is imperative that this course of action be discussed before irrevocable
steps are taken that dissipate the value that is in the Fund and in its
portfolio. Please contact me immediately at (508) 949-4113 to arrange for
this meeting.
Sincerely,
Gerald Fels,
Executive Vice President and
Chief Financial Officer
cc: (via facsimile and overnight mail)
Jameson A. Baxter, Trustee
Hans H. Estin, Trustee
Ronald J. Jackson, Trustee
Paul L. Joskow, Trustee
Elizabeth T. Kennan, Trustee
Lawrence K. Lasser, Trustee
John H. Mullin, III, Trustee
Robert E. Patterson, Trustee
George Putnam, III, Trustee
A.J.C. Smith, Trustee
W. Thomas Stephens, Trustee
W. Nicholas Thorndike, Trustee
Page 13 of 13