COLONIAL INTERNATIONAL FUND FOR GROWTH
Supplement to Prospectus
dated February 28, 1995
(Replacing Supplement Dated April 27, 1995)
Andrew Fleming, head of International Equities of the Fund's Sub- Adviser,
Gartmore Capital Management Ltd., is the Fund's portfolio manager. Over the last
five years Mr. Fleming has served as a Managing Director of the Sub-Adviser and
had been head of the Sub-Adviser's Far East Desk from 1993 to March 1995.
Effective on or about January 1, 1996, the sub-advisory contract with Gartmore
Capital Management Ltd. will be terminated. Following such termination, Colonial
Management Associates, Inc. ("Colonial") will provide the Fund with investment
management services under it's current management agreement. The portfolio
managers for the Fund will be Bruno Bertocci and David Harris, each of whom is
jointly employed by Colonial and Stein Roe & Farnham Incorporated ("Stein Roe"),
an affiliate of Colonial. Prior to joining Stein Roe in May 1995, each of
Messrs. Bertocci and Harris was employed by Rockefeller & Co. Inc. -- Mr.
Bertocci as a Managing Director and Mr. Harris as a Portfolio Manager.
After January 1, 1996, Colonial will utilize the trading facilities of Stein Roe
to place all orders for the purchase and sale of portfolio securities, futures
contracts and foreign currencies. In selecting broker dealers Colonial may
consider research and brokerage services furnished by the broker dealer. Subject
to seeking best execution, Colonial also may consider sales of shares of the
Fund (and of certain other Colonial funds) in selecting such broker dealers for
portfolio transactions.
IN-36/367B-1095 November 2, 1995
COLONIAL INTERNATIONAL FUND FOR GROWTH
Supplement to Statement of Additional Information
Dated February 28, 1995
(Replacing Supplement dated June 1, 1995)
The following Trustees are being added under the sub-caption Trustees and
Officers under the caption MANAGEMENT OF THE FUNDS:
Robert J. Birnbaum(1), Trustee, is a Trustee (formerly Special Counsel, Dechert,
Price & Rhoads; President and Chief Operating Officer, New York Stock Exchange,
Inc.), 313 Bedford Road, Ridgewood, NJ 07450
James E. Grinnell(1), Trustee, is a Private Investor, 22 Harbor Avenue,
Marblehead, MA 01945
Richard W. Lowry(1), Trustee, is a Private Investor, 10701 Charleston Drive,
Vero Beach, FL 32963
(1) Elected to the Colonial Funds Complex on April 21, 1995.
The first paragraph under the sub-caption Reinvestment Privilege under the
caption INVESTOR SERVICES is revised in its entirety as follows:
An investor who has redeemed Class A, B or D shares may, upon request, reinvest
within one year a portion or all of the proceeds of such sale in shares of the
same Class of any Colonial fund at the NAV next determined after CISC receives a
written reinvestment request and payment. Any CDSC paid at the time of the
redemption will be credited to the shareholder upon reinvestment. The period
between the redemption and the reinvestment will not be counted in aging the
reinvested shares for purposes of calculating any CDSC or conversion date.
Investors who desire to exercise this Privilege should contact their FSF or
CISC. Shareholders may exercise this Privilege an unlimited number of times.
Exercise of this Privilege does not alter the federal income tax treatment of
any capital gains realized on the prior sale of Fund shares, but to the extent
any such shares were sold at a loss, some or all of the loss may be disallowed
for tax purposes. Consult your tax adviser.
Separately, effective on or about January 1, 1996, following the termination of
the Fund's sub-advisory contract and the assumption by Colonial Management
Associates, Inc. (Adviser) of portfolio management responsibilities, the
information under the sub-caption Portfolio Transactions is deleted from Part 2
and replaced with the following in Part 1.
Portfolio Transactions
Investment decisions. The Fund's portfolio managers will use the trading
facilities of Stein Roe & Farnham Incorporated (Stein Roe), an affiliate of the
Adviser, to place all orders for the purchase and sale of the Fund's portfolio
securities, futures contracts and foreign currencies.
The Adviser acts as investment adviser to each of the Colonial funds (except for
the Colonial Municipal Money Market Fund, Colonial Global Utilities Fund and
Colonial Newport Tiger Fund, each of which is administered by the Adviser), and
its affiliates advise other institutional, corporate, fiduciary and individual
clients. Various officers and Trustees of the Trust also serve as officers or
Trustees of other Colonial funds. The Colonial funds and clients advised by the
Adviser and its affiliates sometimes invest in securities in which the Fund also
invests and sometimes enter into transactions utilizing stock index futures and
foreign currencies. In certain cases, purchases and sales on behalf of the Fund
and other clients of the Adviser or its affiliates will be bunched and executed
on an aggregate basis. In such cases, each participating fund or client will
receive the average price at which the trade is executed. Where less than the
desired aggregate amount is able to be purchased or sold, the actual amount
purchased or sold will be allocated among the participating funds or clients in
proportion to the amounts desired to be purchased or sold by each. Although in
some cases these practices could have a detrimental effect on the price or
volume of the securities, futures or currencies as far as the Fund is concerned,
in most cases it is believed that these practices should produce better
executions. It is the opinion of the Trustees that the desirability of retaining
the Adviser as investment adviser to the Colonial funds outweighs the
disadvantages, if any, which might result from these practices.
Brokerage and research services. The overriding objective in effecting portfolio
transactions for the Fund is to seek to obtain the best combination of price and
execution. The best net price, giving effect to brokerage commissions, if any,
and other transaction costs, normally is an important factor in this decision,
but a number of other judgmental factors may also enter into the decision. These
include: negotiated commission rates currently available and other current
transaction costs; the nature of the security being traded; the size of the
transaction; the desired timing of the trade; the activity existing and expected
in the market for the particular security; confidentiality; the execution,
clearance and settlement capabilities of the broker or dealer selected and
others which are considered; financial stability of the broker or dealer
selected and such other brokers or dealers; and any actual or apparent
operational problems of any broker or dealer. Recognizing the value of these
factors, the Fund may pay a brokerage commission in excess of that which another
broker or dealer may have charged for effecting the same transaction.
Evaluations of the reasonableness of brokerage commissions, based on the
foregoing factors, are made on an ongoing basis in the course of effecting
portfolio transactions. The general level of brokerage commissions paid is
reviewed by the Adviser and reports are made annually to the Board of Trustees
of the Trust.
With respect to purchases and sales of securities involving brokerage
commissions, when more than one broker or dealer is believed to be capable of
providing the best combination of price and execution with respect to a
particular portfolio transaction for the Fund, the Adviser may select a broker
or dealer that has furnished it or its affiliates with research products or
services such as research reports, subscriptions to financial publications and
research compilations, compilations of securities prices, earnings, dividends,
and similar data, and computer data bases, quotation equipment and services,
research-oriented computer software and services, and services of economic and
other consultants. Selection of brokers or dealers is not made pursuant to an
agreement or understanding with any of the brokers or dealers; however, the
Adviser and its affiliates may endeavor to direct sufficient commissions
generated by its clients' accounts in the aggregate, including the Fund, to such
brokers or dealers to ensure the continued receipt of research products or
services that the Adviser feels are useful. In certain instances, the Adviser
and its affiliates receive from brokers and dealers products or services which
are used both as investment research and for administrative, marketing, or other
non-research purposes. In such instances, the Adviser makes a good faith effort
to determine the relative proportions of such products or services which may be
considered as investment research. The portion of the costs of such products or
services attributable to research usage may be defrayed by the Adviser (without
prior agreement or understanding, as noted above) through brokerage commissions
generated by transactions by clients (including the Fund), while the portions of
the costs attributable to non-research usage of such products or services is
paid by the Adviser in cash. No person acting on behalf of the Fund is
authorized, in recognition of the value of research products or services, to pay
a commission in excess of that which another broker or dealer might have charged
for effecting the same transaction. Research products or services furnished by
brokers and dealers may be used in servicing any or all of the clients of the
Adviser and its affiliates and not all such research products or services are
used in connection with the management of the Fund. With respect to the Fund's
purchases and sales of portfolio securities transacted with a broker or dealer
on a net basis, the Adviser may also consider the part, if any, played by the
broker or dealer in bringing the security involved to the Adviser's attention,
including investment research related to the security and provided to the Fund.
As stated above, the overriding objective in effecting portfolio transactions
for the Fund is to seek to obtain the best combination of price and execution.
However, consistent with the provisions of the Rules of Fair Practice of the
National Association of Securities Dealers, Inc., where more than one broker
dealer is believed capable of providing the best combination of price and
execution with respect to a particular transaction, a broker dealer may be
selected in recognition of its sales of shares of the Fund or of other Colonial
funds. Neither the Fund nor the Adviser has entered into any agreement with, or
made any commitment to, any broker dealer which would bind the Fund or the
Adviser to direct portfolio transactions to a broker dealer to compensate the
broker dealer, directly or indirectly, for sales of shares of the Fund. Nor does
the Fund pay brokerage commissions higher than those obtainable from other
broker dealers in recognition of such sales.
IN-16/373B-1195 November 2, 1995
