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[Ivy Funds Logo]
This is your prospectus from
IVY MACKENZIE
DISTRIBUTORS, INC.
Via Mizner Financial Plaza
700 South Federal Highway
Boca Raton, Florida 33432
800.456.5111
May 3, 1999 IVY INTERNATIONAL FUND
Supplemented June 7, 1999
Ivy Fund is a registered open-end investment company consisting
of nineteen separate portfolios. This Prospectus relates to the
Class A, Class B, Class C and Class I shares of Ivy International
Fund (the "Fund").
On April 18, 1997 the Fund suspended the
offer of its shares to new investors.
The Securities and Exchange Commission
has not approved or disapproved these
securities or passed upon the adequacy
or accuracy of this Prospectus. Any
representation to the contrary is a
criminal offense.
Investments in the Fund are not deposits
of any bank and are not federally
insured or guaranteed by the Federal
Deposit Insurance Corporation or any
other government agency.
-- CONTENTS
2 Ivy International Fund
4 Additional information
about investment strategies
and risks
6 Management
7 Shareholder information
14 Financial highlights
17 Account application
<TABLE>
<S> <C>
OFFICERS
Michael G. Landry, Chairman
Keith J. Carlson, President
James W. Broadfoot, Vice President
C. William Ferris, Secretary/Treasurer
LEGAL COUNSEL
Dechert Price & Rhoads
Boston, Massachusetts
CUSTODIAN AUDITORS
Brown Brothers Harriman & Co. PricewaterhouseCoopers LLP
Boston, Massachusetts Fort Lauderdale, Florida
TRANSFER AGENT INVESTMENT MANAGER
Ivy Mackenzie Services Corp. Ivy Management, Inc.
PO Box 3022 700 South Federal Highway
Boca Raton, Florida 33431-0922 Boca Raton, Florida 33432
800.777.6472 800.456.5111
</TABLE>
(Ivy Mackenzie Logo)
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[IVY LEAF LOGO]
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IVY INTERNATIONAL FUND
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(GLOBE ARTWORK)
IVY
INTERNATIONAL
FUND
- -- INVESTMENT OBJECTIVE
The Fund's principal investment objective is long-term capital growth.
Consideration of current income is secondary to this principal objective.
- -- PRINCIPAL INVESTMENT STRATEGIES
The Fund normally invests at least 65% of its total assets in equity securities
principally traded in European, Pacific Basin and Latin American markets.
To enhance potential return, the Fund may invest in countries with new or
developing economies.
The Fund's manager uses a low turnover, value approach in selecting the Fund's
investments.
- -- PRINCIPAL RISKS
The main risks to which the Fund is exposed in carrying out its investment
strategies are the following:
MANAGEMENT RISK: Securities selected for the Fund might not perform as well as
the securities held by other mutual funds with investment objectives that are
similar to those of the Fund.
MARKET RISK: Common stock represents a proportionate ownership interest in a
company. As a result, the value of common stock rises and falls with a company's
success or failure. The market value of common stock can fluctuate significantly
even where "management risk" is not a factor, so you could lose money if you
redeem your Fund shares at a time when the Fund's stock portfolio is not
performing as well as expected.
FOREIGN SECURITY RISK: Investing in foreign securities involves a number of
economic, financial and political considerations that are not associated with
the U.S. markets and that could affect the Fund's performance unfavorably,
depending upon prevailing conditions at any given time. Among these potential
risks are:
- - greater price volatility;
- - comparatively weak supervision and regulation of securities exchanges, brokers
and issuers;
- - higher brokerage costs;
- - fluctuations in foreign currency exchange rates and related conversion costs;
- - adverse tax consequences; and
- - settlement delays.
The risks of investing in foreign securities are more acute in countries with
new or developing economies.
- -- WHO SHOULD INVEST*
The Fund may be appropriate for investors seeking long-term growth potential,
but who can accept moderate fluctuations in capital value in the short term.
*You should consult with your financial advisor before deciding whether the Fund
is an appropriate investment choice in light of your particular financial needs
and risk tolerance.
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-- PERFORMANCE BAR CHART AND TABLE
The information in the following chart and table provides some indication
of the risks of investing in the Fund by showing changes in the Fund's
performance from year to year and how the Fund's average annual returns
since it was first offered for sale to the public on April 30, 1986 compare
with those of a broad measure of market performance. The Fund's past
performance is not an indication of how the Fund will perform in the
future.
(CHART)
<TABLE>
<S> <C>
ANNUAL TOTAL RETURNS for the years ending
FOR CLASS A SHARES* December 31(**)
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</TABLE>
*Any applicable sales charges and account fees are not reflected, and if
they were the returns shown above would be lower. The returns for the
Fund's other three classes of shares during these periods were different
from those of Class A because of variations in their respective expense
structures.
**Hakan Castegren, in his relationship with the following firms, has served
as the Fund's portfolio manager since its inception: Northern Cross
Investments Limited (since April 1, 1993); Boston Overseas Investors,
Inc. (July 1, 1990 -- March 31, 1993) and Marsh & Cunningham (November
15, 1985 -- June 30, 1990).
Best quarter Q1 '87: 24.22%
Worst quarter Q4 '87: (22.74%)
<TABLE>
<CAPTION>
for the periods ending
AVERAGE ANNUAL TOTAL RETURNS(#) December 31
-------------------------------------------------------------------------------------------
MORNINGSTAR LIPPER
MSCI FOREIGN INTL
EAFE STOCK EQUITY
CLASS A CLASS B CLASS C CLASS I INDEX UNIVERSE CATEGORY
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Past year........ 1.17% 1.43% 5.46% 7.75% 20.00% 12.26% 13.02%
Past 5 years..... 9.37% 9.51% n/a 10.81% 9.19% 7.44% 7.87%
Past 10 years.... 11.73% n/a n/a n/a 5.54% 8.54% 9.29%
Since inception:
Class B*......... n/a 10.82% n/a n/a 8.39% 8.23% 8.88%
Class C**........ n/a n/a 10.30% n/a 7.84% 7.92% 8.51%
Class I***....... n/a n/a n/a 11.77% 8.74% 7.99% 8.76%
</TABLE>
(*)Performance figures reflect any applicable sales charges.
*The inception date for the Fund's Class B shares is October 23, 1993.
MSCI Index performance calculated from October 31, 1993. Morningstar
performance calculated from November 1, 1993. Lipper performance
calculated from October 28, 1993.
**The inception date for the Fund's Class C shares is April 30, 1996.
***The inception date for the Fund's Class I shares is October 6, 1994.
MSCI Index performance calculated from September 30, 1994. Morningstar
performance calculated from October 1, 1994.
- -- FEES AND EXPENSES
The following tables describe the fees and expenses that you may pay
if you buy and hold shares of the Fund:
<TABLE>
<S> <C>
fees paid directly from
SHAREHOLDER FEES your investment
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</TABLE>
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS I
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<S> <C> <C> <C> <C>
Maximum sales charge (load)
imposed on purchases (as a
percentage of offering
price)..................... 5.75% none none none
Maximum deferred sales
charge (load) (as a
percentage of purchase
price)..................... none 5.00% 1.00% none
Maximum sales charge (load)
imposed on reinvested
dividends.................. none none none none
Redemption fee*............ none none none none
Exchange fee............... none none none none
</TABLE>
*If you choose to receive your redemption proceeds via Federal Funds
wire, a $10 wire fee will be charged to your account.
<TABLE>
<S> <C>
ANNUAL FUND expenses that are
OPERATING EXPENSES deducted from Fund assets
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</TABLE>
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS I
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<S> <C> <C> <C> <C>
Management fees*......... 1.00% 1.00% 1.00% 1.00%
Distribution and/or
service (12b-1) fees..... 0.25% 1.00% 1.00% none
Other expenses........... 0.33% 0.41% 0.40% 0.18%
Total annual Fund
operating expenses....... 1.58% 2.41% 2.40% 1.18%
</TABLE>
*Management Fees are reduced to 0.90% for net assets over $2.5
billion.
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-- EXAMPLE
The following example is intended to help you compare the cost of investing
in the Fund with the cost of investing in other mutual funds. The example
assumes that you invest $10,000 in the Fund for the time periods indicated
and then redeem all of your shares at the end of those periods (with
additional information shown for Class B and Class C shares based on the
assumption that you do not redeem your shares at that time). The example
also assumes that your investment has a 5% return each year and that the
Fund's operating expenses remain, the same. Although your actual costs may
be higher or lower, based on these assumptions, your costs would be as
follows:
<TABLE>
<CAPTION>
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(no redemption) (no redemption)
YEAR CLASS A CLASS B CLASS B CLASS C CLASS C CLASS I
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<S> <C> <C> <C> <C> <C> <C>
1st $ 726 $ 744 $ 244 $ 343 $ 243 $ 120
3rd 1,045 1,051 751 748 748 375
5th 1,386 1,485 1,285 1,280 1,280 649
10th 2,345 2,541 2,541 2,736 2,736 1,432
</TABLE>
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IVY INTERNATIONAL FUND
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ADDITIONAL INFORMATION
ABOUT INVESTMENT
STRATEGIES AND RISKS
- -- PRINCIPAL STRATEGIES
The Fund seeks to achieve its principal objective of long-term capital growth by
investing primarily in equity securities principally traded in European, Pacific
Basin and Latin American markets. The Fund invests in a variety of economic
sectors and industry segments to reduce the effects of price volatility in any
one area, and usually is invested in at least three different countries.
The Fund's manager focuses on rapidly expanding foreign economies and companies
that generally have at least $1 billion in capitalization at the time of
investment and a solid history of operations. Individual securities are selected
on the basis of value indicators (such as earnings, cash flow, assets and
long-term growth potential) and are reviewed for fundamental financial strength.
- -- PRINCIPAL RISKS
GENERAL MARKET RISK:
As with any mutual fund, the value of the Fund's investments and the income
they generate will vary daily and generally reflect market conditions, interest
rates and other issuer-specific, political or economic developments.
The Fund's share value will decrease at any time during which its security
holdings or other investment techniques are not performing as well as
anticipated, and you could therefore lose money by investing in the Fund
depending upon the timing of your initial purchase and any subsequent
redemption.
OTHER RISKS: Since the Fund invests heavily in the equity securities of foreign
issuers, it is more susceptible to the risks associated with these types of
securities than a fund that invests primarily in the securities of U.S. issuers
and/or debt securities. Following is a description of these risks, along with
the risks commonly associated with the other securities and investment
techniques that the Fund's portfolio manager considers important in achieving
the Fund's investment objective or in managing the Fund's exposure to risk (and
that could therefore have a significant effect on the Fund's returns). Other
investment methods that the Fund may use (such as derivative investments), but
that do not play a key role in the Fund's overall investment strategy, are
described in the Fund's Statement of Additional Information (see back cover page
for information on how you can receive a free copy).
- - COMMON STOCKS: Common stock represents a proportionate ownership interest in a
company. As a result, the value of common stock rises and falls with a
company's success or failure. The market value of common stock can fluctuate
significantly, with smaller companies being particularly susceptible to price
swings. Transaction costs in smaller-company stocks may also be higher than
those of larger companies.
- - DEPOSITORY RECEIPTS: The Fund may acquire interests in foreign issuers in the
form of sponsored or unsponsored American Depository Receipts ("ADRs"), Global
Depository Receipts ("GDRs") and similar types of depository receipts. ADRs
typically are issued by a U.S. bank or trust company and represent ownership
of the underlying securities issued by a foreign corporation. GDRs and other
types of depository receipts are usually issued by foreign banks or trust
companies. The Fund's investments in ADRs, GDRs and other depository receipts
are viewed as investments in the underlying securities.
Depository receipts can be difficult to price and are not always
exchange-listed. Unsponsored depository programs also are organized
independently without the cooperation of the issuer of the underlying
securities. As a result, information concerning the issuer may not be as
current or as readily available as in the case of sponsored depository
instruments, and their prices may be more volatile than if they were sponsored
by the issuers of the underlying securities.
- - FOREIGN SECURITIES: Investing in foreign securities involves a number of
economic, financial and political considerations that are not associated with
the U.S. markets and that could affect the Fund's performance favorably or
unfavorably,
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depending upon prevailing conditions at any given time. For example, the
securities markets of many foreign countries may be smaller, less liquid and
subject to greater price volatility than those in the U.S. Foreign investing
may also involve brokerage costs and tax considerations that are not usually
present in the U.S. markets.
Other factors that can affect the value of the Fund's foreign investments
include the comparatively weak supervision and regulation by some foreign
governments of securities exchanges, brokers and issuers, and the fact that
many foreign companies may not be subject to uniform accounting, auditing and
financial reporting standards. It may also be difficult to obtain reliable
information about the securities and business operations of certain foreign
issuers. Settlement of portfolio transactions may also be delayed due to local
restrictions or communication problems, which can cause the Fund to miss
attractive investment opportunities or impair its ability to dispose of
securities in a timely fashion (resulting in a loss if the value of the
securities subsequently declines).
- - SPECIAL EMERGING-MARKET CONCERNS: The risks of investing in foreign securities
are heightened in countries with developing economies. Among these additional
risks are the following:
- securities that are even less liquid and more volatile than those in more
developed foreign countries;
- less stable governments that are susceptible to sudden adverse actions (such
as nationalization of businesses, restrictions on foreign ownership or
prohibitions against repatriation of assets);
- increased settlement delays;
- abrupt changes in exchange rate regime or monetary policy;
- unusually large currency fluctuations and currency conversion costs (see
"Foreign Currencies" below); and
- high national debt levels (which may impede an issuer's payment of principal
and/or interest on external debt).
- - FOREIGN CURRENCIES: Many of the Fund's securities are denominated in foreign
currencies and the value of the Fund's investments as measured in U.S. dollars
may be affected unfavorably by changes in foreign currency exchange rates and
exchange control regulations. Currency conversion can also be costly.
- - FOREIGN CURRENCY EXCHANGE TRANSACTIONS AND FORWARD FOREIGN CURRENCY CONTRACTS:
The Fund may, but is not required to, use foreign currency exchange
transactions and forward foreign currency contracts to hedge certain market
risks (such as interest rates, currency exchange rates and broad or specific
market movement). These investment techniques involve a number of risks,
including the possibility of default by the counterparty to the transaction
and, to the extent the Fund's judgment as to certain market movements is
incorrect, the risk of losses that are greater than if the investment
technique had not been used. For example, there may be an imperfect
correlation between the Fund's portfolio holdings of securities denominated in
a particular currency and the forward contracts entered into by the Fund. An
imperfect correlation of this type may prevent the Fund from achieving the
intended hedge or expose the Fund to the risk of currency exchange loss. In
addition, although the use of these investment techniques for hedging purposes
should tend to minimize the risk of loss due to a decline in the value of the
hedged position, they also tend to limit any potential gain that might result
from an increase in the position's value.
- - ILLIQUID SECURITIES: The Fund may invest up to 15% of its net assets in
"illiquid securities," which are assets that may not be disposed of in the
ordinary course of business within seven days at roughly the value at which
the Fund has valued the assets. Some of these may be "restricted securities,"
which cannot be sold to the public without registration under the Securities
Act of 1933 (in the absence of an exemption) or because of other legal or
contractual restrictions on resale. Thus, while illiquid securities may offer
the potential for higher returns than more readily marketable securities,
there is a risk that the Fund will not be able to dispose of them promptly at
an acceptable price.
- - WARRANTS: As a holder of certain securities, the Fund may have the opportunity
to purchase warrants. The holder of a warrant pays for the right to purchase a
given number of an issuer's shares at a specified price until the warrant
expires. If a warrant is not exercised by the date
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IVY INTERNATIONAL FUND
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of its expiration (such as when the underlying securities are no longer an
attractive investment), the Fund would lose what it paid for the warrant.
- - TEMPORARY DEFENSIVE POSITIONS: The Fund may from time to time take a temporary
defensive position and invest without limit in U.S. Government securities,
investment-grade debt securities, and cash and cash equivalents such as
commercial paper, short-term notes and other money market securities. When the
Fund assumes such a defensive position it may not achieve its investment
objective. Investing in debt securities also involves both interest rate and
credit risk. Generally, the value of debt instruments rises and falls
inversely with fluctuations in interest rates. Thus, as interest rates decline
the value of debt securities generally increases. Conversely, rising interest
rates tend to cause the value of debt securities to decrease. The market value
of debt securities also tends to vary according to the relative financial
condition of the issuer. Bonds with longer maturities tend to be more volatile
than bonds with shorter maturities.
- - BORROWING: For temporary or emergency purposes (such as meeting shareholder
redemption requests within the time periods specified under the Investment
Company Act of 1940), the Fund may borrow up to 10% of the value of its total
assets from qualified banks. Borrowing may exaggerate the effect on the Fund's
share value of any increase or decrease in the value of the securities it
holds. Money borrowed will also be subject to interest costs.
- -- OTHER IMPORTANT INFORMATION
EUROPEAN MONETARY UNION: On January 1, 1999, a new European currency called the
"euro" was introduced and adopted for use by eleven European countries. The
transition to daily usage of the euro will occur during the period from January
1, 1999 through December 31, 2001, at which time euro bills and coins will be
put into circulation. Certain European Union members, including the United
Kingdom, did not officially implement the euro on January 1, 1999 and may cause
market disruptions when and if they decide to do so. Should this occur, the Fund
could experience investment losses.
YEAR 2000 RISKS: Many computer software and hardware systems in use today cannot
distinguish between the year 2000 and the year 1900 because of the way dates are
encoded and calculated (the "Year 2000 Problem"). The inability of computer-
based systems to make this distinction could have a seriously adverse effect on
the handling of securities trades, pricing and account services worldwide. The
Fund's service providers are taking steps that each believes are reasonably
designed to address the Year 2000 Problem with respect to the computer systems
that they use. Information about the year 2000 readiness of the issuers of the
securities that the Fund may purchase is also taken into consideration during
the investment decision-making process (though such information may not be
readily available, particularly in non-U.S. countries, and may be limited to
public filings or statements from company representatives that are not
independently verifiable).
The Fund believes these steps will be sufficient to avoid any material adverse
impact on the Fund. At this time, however, there can be no assurance that
significant problems will not occur (which either directly or indirectly may
cause the Fund to lose money).
MANAGEMENT
- -- INVESTMENT ADVISOR
Ivy Management, Inc. ("IMI")
Via Mizner Financial Plaza
700 South Federal Highway, Suite 300
Boca Raton, Florida 33432
IMI provides investment advisory and business management services to the Fund.
IMI is an SEC-registered investment advisor with over $5 billion in assets under
management, and provides similar services to the other eighteen series of the
Trust. For the Fund's fiscal year ending December 31, 1998, the Fund paid to IMI
a fee equal to 1.00% of the Fund's average net assets.
Northern Cross Investments Limited ("Northern Cross"), an SEC-registered
investment advisor located at 48 Par-La-Ville Road, Hamilton, HM 11 Bermuda,
serves as subadvisor to the Fund under an Agreement with IMI. Northern Cross
began operations in 1993, and as of the end of 1998 had over $10 billion in
assets under management. For its services, Northern Cross receives a fee from
IMI that is equal, on an annual basis, to 0.60% of the first $1.5 billion in
average net assets, 0.55% of
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the next $1 billion in average net assets and 0.50% of the Fund's average net
assets over $2.5 billion.
- -- PORTFOLIO MANAGER
Hakan Castegren, President of Northern Cross, has managed the Fund since 1986.
Mr. Castegren has more than 40 years of professional investment experience and
holds an MBA from the Stockholm School of Economics.
SHAREHOLDER INFORMATION
- -- PRICING OF FUND SHARES
The Fund calculates its share price by dividing the value of the Fund's net
assets by the total number of its shares outstanding as of the close of regular
trading (usually 4:00 p.m. Eastern time) on the New York Stock Exchange on each
day the Exchange is open for trading (normally any weekday that is not a
national holiday).
Each portfolio security that is listed or traded on a recognized stock exchange
is valued at the security's last sale price on the exchange on which it was
purchased.
If no sale is reported at that time, the average between the last bid and asked
prices is used. Securities and other Fund assets for which market prices are not
readily available are priced at their fair value as determined by IMI in
accordance with procedures approved by the Fund's Board of Trustees. IMI may
also price a foreign security at its fair value if events materially affecting
the estimated value of the security occur between the close of the foreign
exchange on which the security is principally traded and the time as of which
the Fund prices its shares. Fair-value pricing under these circumstances is
designed to protect existing shareholders from the actions of short-term
investors trading into and out of the Fund in an attempt to profit from
short-term market movements. When such fair-value pricing occurs, however, there
may be some period of time during which the Fund's share price and/or
performance information is not available.
The number of shares you receive when you place a purchase or exchange order,
and the payment you receive after submitting a redemption request, is based on
the Fund's net asset value ("NAV") next determined after your instructions are
received in proper form by Ivy Mackenzie Services Corp. ("IMSC") (the Fund's
transfer agent) or by your registered securities dealer. Each purchase and
redemption order is subject to any applicable sales charge (see "Choosing the
appropriate class of shares" below). Since the Fund normally invests in
securities that are listed on foreign exchanges that may trade on weekends or
other days when the Fund does not price its shares, the Fund's share value may
change on days when shareholders will not be able to purchase or redeem the
Fund's shares.
- -- HOW TO BUY SHARES
Please read these sections carefully before investing.
Effective April 18, 1997, the Fund suspended the offer of its shares to new
investors. Shares of the Fund are available for purchase only by existing
shareholders of the Fund. Once a shareholder's account has been liquidated, the
shareholder may not invest in the Fund at a later date.
CHOOSING THE APPROPRIATE CLASS OF SHARES:
The essential features of the Fund's different classes of shares are described
below. If you do not specify on your Account Application which class of shares
you are purchasing, it will be assumed that you are purchasing Class A shares.
The Fund has adopted separate distribution plans pursuant to Rule 12b-1 under
the 1940 Act for its Class A, B and C shares that allow the Fund to pay
distribution and other fees for the sale and distribution of its shares and for
services provided to shareholders. Because these fees are paid out of the Fund's
assets on an ongoing basis, over time they will increase the cost of your
investment and may cost you more than paying other types of sales charges.
- - CLASS A SHARES: Class A shares are sold at net asset value plus a maximum
sales charge of 5.75% (the "offering price"). The sales charge may be reduced
or eliminated if certain conditions are met (see "Additional purchase
information" on page 8). Class A shares are subject to a 0.25% Rule 12b-1
service fee.
- - CLASS B SHARES: Class B shares are offered at net asset value, without an
initial sales charge,
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IVY INTERNATIONAL FUND
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but subject to a contingent deferred sales charge ("CDSC") that declines from
5.00% to zero on certain redemptions within six years of purchase. Class B
shares are subject to a 0.75% Rule 12b-1 distribution fee and a 0.25% Rule
12b-1 service fee, and convert automatically into Class A shares eight years
after purchase.
- - CLASS C SHARES: Class C shares are offered at net asset value, without an
initial sales charge, but subject to a CDSC of 1.00% for redemptions within
the first year of purchase. Class C shares are subject to a 0.75% Rule 12b-1
distribution fee and a 0.25% Rule 12b-1 service fee.
- - CLASS I SHARES: Class I shares are offered to certain classes of investors at
net asset value, without any sales load or Rule 12b-1 fees.
The following table displays the various investment minimums, sales charges and
expenses that apply to each class.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
CLASS A CLASS B CLASS C CLASS I
- --------------------------------------------------------------------
<S> <C> <C> <C> <C>
Minimum initial
investment*.......... $1,000 $1,000 $1,000 $5,000,000
Minimum subsequent
investment*.......... $100 $100 $100 $10,000
Initial sales
charge............... Maximum None None None
5.75%,
with
options
for a
reduction
or waiver
CDSC................. None, Maximum 1.00% for None
except on 5.00%, the first
certain declines year
NAV over six
purchases years
Service and
distribution fees.... 0.25% 0.75% 0.75% None
service distribution distribution
fee fee and fee and
0.25% 0.25%
service fee service
fee
</TABLE>
*Minimum initial and subsequent investments for retirement plans are $25.
- -- ADDITIONAL PURCHASE INFORMATION
CLASS A SHARES: Class A shares are sold at a public offering price equal to
their net asset value per share plus an initial sales charge, as set forth below
(which is reduced as the amount invested increases):
<TABLE>
<CAPTION>
- ---------------------------------------------------------------
SALES SALES PORTION OF
CHARGE AS A CHARGE AS A PUBLIC
PERCENTAGE PERCENTAGE OFFERING
OF PUBLIC OF NET PRICE
OFFERING AMOUNT RETAINED BY
AMOUNT INVESTED PRICE INVESTED DEALER
- ---------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000..... 5.75% 6.10% 5.00%
$50,000 but less than
$100,000.............. 5.25% 5.54% 4.50%
$100,000 but less than
$250,000.............. 4.50% 4.71% 3.75%
$250, 000 but less
than $500,000......... 3.00% 3.09% 2.50%
$500,000 or over*..... 0.00% 0.00% 0.00%
</TABLE>
*A CDSC of 1.00% may apply to Class A shares that are redeemed within two years
of the end of the month in which they were purchased.
Class A shares that are acquired through reinvestment of dividends or
distributions are not subject to any sales charges.
HOW TO REDUCE YOUR INITIAL SALES CHARGE:
- "Rights of Accumulation" permits you to pay the sales charge that applies to
the cost or value (whichever is higher) of all Ivy Fund Class A shares you
own.
- A "Letter of Intent" permits you to pay the sales charge that would apply to
your cumulative purchase of Fund shares over a 13-month period (certain
restrictions apply).
HOW TO ELIMINATE YOUR INITIAL SALES CHARGE: You may purchase Class A shares at
NAV (without an initial sales charge or a CDSC) through any one of the following
methods:
- through certain investment advisors and financial planners who charge a
management, consulting or other fee for their services;
- under certain qualified retirement plans;
- as an employee or director of Mackenzie Investment Management Inc. or its
affiliates;
- as an employee of a selected dealer; or
- through the Merrill Lynch Daily K Plan (the "Plan"), provided the Plan has at
least $3 million in assets or over 500 or more eligible employees. Class B
shares of the Fund are made available to Plan participants at NAV without a
CDSC if the Plan has less than $3 million in
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assets or fewer than 500 eligible employees. For further information see
"Group Systematic Investment Program" in the SAI.
Certain trust companies, bank trust departments, credit unions, savings and
loans and other similar organizations may also be exempt from the initial sales
charge on Class A shares.
You may also purchase Class A shares at NAV if you are investing at least
$500,000 through a dealer or agent. Ivy Mackenzie Distributors, Inc. ("IMDI"),
the Fund's distributor, may pay the dealer or agent (out of IMDI's own
resources) for its distribution assistance according to the following schedule:
<TABLE>
<CAPTION>
- --------------------------------------------------
PURCHASE AMOUNT COMMISSION
- --------------------------------------------------
<S> <C>
First $3,000,000...................... 0.50%
Next $2,000,000....................... 0.25%
Over $5,000,000....................... 0.10%
</TABLE>
IMDI may from time to time pay a bonus or other cash incentive to dealers (other
than IMDI) including, for example, those which employ a registered
representative who sells a minimum dollar amount of the shares of the Fund
and/or other funds distributed by IMDI during a specified time period.
CLASS B AND CLASS C SHARES: Class B and Class C shares are not subject to an
initial sales charge but are subject to a CDSC. If you redeem your Class C
shares within one year of purchase they will be subject to a CDSC of 1.00%, and
Class B shares redeemed within six years of purchase will be subject to a CDSC
at the following rates:
<TABLE>
<CAPTION>
- ----------------------------------------------------
CDSC AS A PERCENTAGE OF
YEAR SINCE DOLLAR AMOUNT
PURCHASE SUBJECT TO CHARGE
- ----------------------------------------------------
<S> <C>
First...................... 5.00%
Second..................... 4.00%
Third...................... 3.00%
Fourth..................... 3.00%
Fifth...................... 2.00%
Sixth...................... 1.00%
Seventh and thereafter..... 0.00%
</TABLE>
The CDSC for both Class B and Class C shares will be assessed on an amount equal
to the lesser of the current market value or the original purchase cost of the
shares being redeemed. No charge will be assessed on increases in account value
above the original purchase price or on reinvested dividends and distributions.
Shares will be redeemed on a lot-by-lot basis in the following order:
- - Shares held more than six years;
- - Shares acquired through reinvestment of dividends and distributions;
- - Shares subject to the lowest CDSC percentage, on a first-in, first-out basis
(1) with the portion of the lot attributable to capital appreciation, which is
not subject to a CDSC, redeemed first, then
(2) the portion of the lot attributable to your original basis, which is
subject to a CDSC.
The CDSC for Class B shares is waived for:
- - Certain post-retirement withdrawals from an IRA or other retirement plan if
you are over 59 1/2 years old.
- - Redemptions by certain eligible 401(a) and 401(k) plans and certain retirement
plan rollovers.
- - Redemptions resulting from a tax-free return of excess contribution to an IRA.
- - Withdrawals resulting from shareholder death or disability provided that the
redemption is requested within one year of death or disability.
- - Withdrawals through the Systematic Withdrawal Plan of up to 12% per year of
your account value at the time the plan is established.
Both Class B shares and Class C shares are subject to an ongoing service and
distribution fee at a combined annual rate of up to 1.00% of the portfolio's
average net assets attributable to its Class B or Class C shares. The ongoing
distribution fees will cause these shares to have a higher expense ratio than
that of Class A and Class I shares. IMDI uses the money that it receives from
the deferred sales charge and the distribution fees to cover various promotional
and sales related expenses, as well as expenses related to providing
distributions services, such as compensating selected dealers and agents for
selling these shares.
Approximately eight years after the original date of purchase, your Class B
shares will be converted automatically to Class A shares. Class A shares are
subject to lower annual expenses than Class B shares. The conversion from Class
B shares to Class A shares is not considered a taxable event for Federal income
tax purposes. Class C shares do not have a similar conversion privilege.
9
<PAGE> 10
[IVY LEAF LOGO]
- --------------------------------------------------------------------------------
IVY INTERNATIONAL FUND
- --------------------------------------------------------------------------------
CLASS I SHARES: Class I shares are offered only to institutions and certain
individuals, and are not subject to an initial sales charge or a CDSC, nor to
ongoing service or distribution fees. Class I shares also bear lower fees than
Class A, Class B and Class C shares.
- -- SUBMITTING YOUR PURCHASE ORDER
INITIAL INVESTMENTS: Complete and sign the Account Application appearing at the
end of this Prospectus. Enclose a check payable to Ivy International Fund. You
should note on the check the class of shares you wish to purchase (see page 8
for minimum initial investments). Deliver your application materials to your
registered representative or selling broker, or send them to one of the
addresses below:
- - BY REGULAR MAIL:
Ivy Mackenzie Services Corp.
PO Box 3022
Boca Raton, FL 33431-0922
- - BY COURIER:
Ivy Mackenzie Services Corp.
700 South Federal Hwy., Ste. 300
Boca Raton, FL 33432-6114
- -- BUYING ADDITIONAL SHARES
There are several ways to increase your investment in the Fund:
- - BY MAIL: Send your check with a completed investment slip (attached to your
account statement) or written instructions indicating the account
registration, Fund number or name, and account number. Mail to one of the
addresses above.
- - THROUGH YOUR BROKER: Deliver to your registered representative or selling
broker the investment slip attached to your statement, or written
instructions, along with your payment.
- - BY WIRE: Purchases may also be made by wiring money from your bank account to
your Ivy account. Your bank may charge a fee for wiring funds. Before wiring
any funds, please call IMSC at 800.777.6472. Wiring instructions are as
follows:
First Union National Bank of Florida
Jacksonville, FL
ABA #063000021
Account #2090002063833
For further credit to:
Your Account Registration
Your Fund Number and Account Number
- - BY AUTOMATIC INVESTMENT METHOD: You can authorize to have funds electronically
drawn each month from your bank account and invested as a purchase of shares
into your Ivy International Fund account. Complete sections 6A and 7B of the
Account Application.
- -- HOW TO REDEEM SHARES
SUBMITTING YOUR REDEMPTION ORDER: You may redeem your Fund shares through your
registered securities dealer or directly through IMSC. If you choose to redeem
through your registered securities dealer, the dealer is responsible for
properly transmitting redemption orders in a timely manner. If you choose to
redeem directly through IMSC, you have several ways to submit your request:
- - BY MAIL: Send your written redemption request to IMSC at one of the addresses
on the left. Be sure that all registered owners listed on the account sign the
request. Medallion signature guarantees and supporting legal documentation may
be required. When you redeem, IMSC will normally send redemption proceeds to
you on the next business day, but may take up to seven days (or longer in the
case of shares recently purchased by check).
- - BY TELEPHONE: Call IMSC at 800.777.6472 to redeem from your individual, joint
or custodial account. To process your redemption order by telephone, you must
have telephone redemption privileges on your account. IMSC employs reasonable
procedures that require personal identification prior to acting on redemption
instructions communicated by telephone to confirm that such instructions are
genuine. In the absence of such procedures, the Fund or IMSC may be liable for
any losses due to unauthorized or fraudulent telephone instructions. Requests
by telephone can only be accepted for amounts up to $50,000.
- - BY SYSTEMATIC WITHDRAWAL PLAN ("SWP"): You can authorize to have funds
electronically drawn each month from your Ivy International Fund account and
deposited directly into your bank account. Certain minimum balances and
minimum distributions apply. Complete section 6B of the Account Application to
add this feature to your account.
10
<PAGE> 11
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
RECEIVING YOUR REDEMPTION PROCEEDS: You can receive redemption proceeds through
a variety of payment methods:
- - BY CHECK: Unless otherwise instructed in writing, checks will be made payable
to the current account registration and sent to the address of record.
- - BY FEDERAL FUNDS WIRE: Proceeds will be wired on the next business day to a
pre-designated bank account. Your account will be charged $10 each time
redemption proceeds are wired to your bank, and your bank may also charge you
a fee for receiving a Federal Funds wire.
- - BY ELECTRONIC FUNDS TRANSFER ("EFT"): For SWP redemptions only.
IMPORTANT REDEMPTION INFORMATION:
- - A CDSC may apply to certain Class A share redemptions, to Class B shares
redeemed within six years of purchase, and to Class C shares that are redeemed
within one year of purchase.
- - If you own shares of more than one class of the Fund, the Fund will redeem
first the shares having the highest 12b-1 fees, unless you instruct otherwise.
- - Any shares subject to a CDSC will be redeemed last unless you specifically
elect otherwise.
- - Shares will be redeemed in the order described under "Additional purchase
information--Class B and Class C Shares".
- - The Fund may (on 60 days' notice) redeem the accounts of shareholders whose
investment, including sales charges paid, has been less than $1,000 for more
than 12 months.
- - The Fund may take up to seven days (or longer in the case of shares recently
purchased by check) to send redemption proceeds.
- - The Fund may make payment for redeemed shares in the form of securities of the
Fund taken at current values.
- -- HOW TO EXCHANGE SHARES
You may exchange your Fund shares for shares of another Ivy fund, subject to
certain restrictions (see "Important exchange information").
SUBMITTING YOUR EXCHANGE ORDER: You may submit an exchange request to IMSC as
follows:
- - BY MAIL: Send your written exchange request to IMSC at one of the addresses on
page 10 of this Prospectus. Be sure that all registered owners listed on the
account sign the request.
- - BY TELEPHONE: Call IMSC at 800.777.6472 to authorize an exchange transaction.
To process your exchange order by telephone, you must have telephone exchange
privileges on your account. IMSC employs reasonable procedures that require
personal identification prior to acting on exchange instructions communicated
by telephone to confirm that such instructions are genuine. In the absence of
such procedures, the Fund or IMSC may be liable for any losses due to
unauthorized or fraudulent telephone instructions.
IMPORTANT EXCHANGE INFORMATION:
- - You must exchange into the same share class you currently own.
- -- Exchanges are considered
taxable events and may
result in a capital gain or a
capital loss for tax purposes.
- - It is the policy of the Fund to discourage the use of the exchange privilege
for the purpose of timing short-term market fluctuations. The Fund may
therefore limit the frequency of exchanges by a shareholder, charge a
redemption fee (in the case of certain funds), or cancel a shareholder's
exchange privilege if at any time it appears that such market-timing
strategies are being used. For example, shareholders exchanging more than five
times in a 12-month period may be considered to be using market-timing
strategies.
- -- DIVIDENDS, DISTRIBUTIONS AND TAXES
- - The Fund generally declares and pays dividends and capital gain distributions
(if any) at least once a year.
- - Dividends and distributions are "reinvested" in additional Fund shares unless
you request to receive them in cash.
- - Reinvested dividends and distributions are added to your account at NAV and
are not subject to a
11
<PAGE> 12
[IVY LEAF LOGO]
- --------------------------------------------------------------------------------
IVY INTERNATIONAL FUND
- --------------------------------------------------------------------------------
sales charge regardless of which share class you own.
- - Cash dividends and distributions can be sent to you:
- - BY MAIL: a check will be mailed to the address of record unless otherwise
instructed.
- - BY ELECTRONIC FUNDS TRANSFER: your proceeds will be directly deposited into
your bank account.
To change your dividend and/or distribution options, call IMSC at 800.777.6472.
Dividends ordinarily will vary from one class of shares to another. The Fund
intends to declare and pay dividends annually. The Fund will distribute net
investment income and net realized capital gains, if any, at least once a year.
The Fund may make an additional distribution of net investment income and net
realized capital gains to comply with the calendar year distribution requirement
under the excise tax provisions of Section 4982 of the Internal Revenue Code of
1986, as amended (the "Code").
Dividends paid out of the Fund's investment company taxable income (including
dividends, interest and net short-term capital gains) will be taxable to you as
ordinary income. If a portion of the Fund's income consists of dividends paid by
U.S. corporations, a portion of the dividends paid by the Fund may be eligible
for the corporate dividends-received deduction. Distributions of net capital
gains (the excess of net long-term capital gains over net short-term capital
losses), if any, are taxable to you as long-term capital gains, regardless of
how long you have held your shares. Dividends are taxable to you in the same
manner whether received in cash or reinvested in additional Fund shares.
If shares of the Fund are held in a tax-deferred account, such as a retirement
plan, income and gain will not be taxable each year. Instead, the taxable
portion of amounts held in a tax-deferred account generally will be subject to
tax as ordinary income only when distributed from that account.
A distribution will be treated as paid to you on December 31 of the current
calendar year if it is declared by the Fund in October, November or December
with a record date in such a month and paid by the Fund during January of the
following calendar year. In certain years, you may be able to claim a credit or
deduction on your income tax return for your share of foreign taxes paid by the
Fund.
Upon the sale or exchange of your Fund shares, you may realize a capital gain or
loss, which will be long term or short term, generally depending upon how long
you held your shares.
The Fund may be required to withhold U.S. Federal income tax at the rate of 31%
of all distributions payable to you if you fail to provide the Fund with your
correct taxpayer identification number or to make required certifications, or if
you have been notified by the Internal Revenue Service that you are subject to
backup withholding. Backup withholding is not an additional tax. Any amounts
withheld may be credited against your U.S. Federal income tax liability.
Fund distributions may be subject to state, local and foreign taxes. You should
consult with your tax adviser as to the tax consequences of an investment in the
Fund, including the status of distributions from the Fund under applicable state
or local law.
12
<PAGE> 13
- --------------------------------------------------------------------------------
NOTES
- --------------------------------------------------------------------------------
13
<PAGE> 14
[IVY LEAF LOGO]
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the
Fund's financial performance for the past five years, and reflects results
for a single Fund share. The total returns in the table represent the rate
an investor would have earned (or lost) each year on an investment in the
Fund (assuming reinvestment of all dividends and distributions). This
information has been audited by PricewaterhouseCoopers LLP, whose report,
along with the Fund's financial statements, is included in the Fund's
Annual Report to shareholders (which is available upon request).
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS A
IVY INTERNATIONAL FUND --------------------------------------------------------------
for the year ended
December 31,
- ---------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994
SELECTED PER SHARE DATA --------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period...................... $ 39.03 $ 35.89 $ 30.67 $ 27.60 $ 27.71
--------------------------------------------------------------
Income from investment operations
Net investment income................................... .37 .24 .20 .25 .07
Net gains or losses on securities (both realized and
unrealized)........................................... 2.50 3.47 5.85 3.22 1.01
--------------------------------------------------------------
Total from investment operations........................ 2.87 3.71 6.05 3.47 1.08
--------------------------------------------------------------
Less distributions
Dividends from net investment income.................... .35 .21 .19 .25 .07
Distributions
From capital gains.................................... .22 .26 .64 .12 1.11
In excess of capital gains............................ .13 .10 -- .03 --
Returns of capital...................................... -- -- -- -- .01
--------------------------------------------------------------
Total distributions................................... .70 .57 .83 .40 1.19
--------------------------------------------------------------
Net asset value, end of period............................ $ 41.20 $ 39.03 $ 35.89 $ 30.67 $ 27.60
--------------------------------------------------------------
--------------------------------------------------------------
Total return (%).......................................... 7.34(a) 10.38(a) 19.72(a) 12.65(a) 3.92(a)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................. $ 1,613,797 $1,705,772 $989,254 $475,989 $229,586
Ratio of expenses to average net assets (%)............... 1.58 1.59 1.65 1.52 1.58
Ratio of net investment income to average net assets
(%)..................................................... .83 .68 .76 .97 .30
Portfolio turnover rate (%)............................... 15 8 14 6 7
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CLASS B
--------------------------------------------------------------
for the year ended
December 31,
- ---------------------------------------------------------------------------------------------------------------------------
1998 1997 1996 1995 1994
SELECTED PER SHARE DATA --------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period...................... $ 38.82 $ 35.73 $ 30.67 $ 27.60 $ 27.71
--------------------------------------------------------------
Income from investment operations
Net investment (loss) income............................ -- (.06) (.01) .01 (.10)
Net gains or losses on securities (both realized and
unrealized)........................................... 2.50 3.44 5.76 3.20 .91
--------------------------------------------------------------
Total from investment operations........................ 2.50 3.38 5.75 3.21 .81
--------------------------------------------------------------
Less distributions
Dividends
From net investment income............................ -- -- -- .01 --
In excess of net investment income.................... -- -- .05 -- --
Distributions
From capital gains.................................... .22 .21 .64 .10 .90
In excess of capital gains............................ .13 .08 -- .03 --
Returns of capital...................................... -- -- -- -- .02
--------------------------------------------------------------
Total distributions................................... .35 .29 .69 .14 .92
--------------------------------------------------------------
Net asset value, end of period............................ $ 40.97 $ 38.82 $ 35.73 $ 30.67 $ 27.60
--------------------------------------------------------------
--------------------------------------------------------------
Total return (%).......................................... 6.43(a) 9.46(a) 18.76(a) 11.62(a) 2.96(a)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................. $ 542,997 $ 568,521 $312,161 $ 74,650 $ 30,143
Ratio of expenses to average net assets (%)............... 2.41 2.42 2.45 2.44 2.50
Ratio of net investment (loss) income to average net
assets (%).............................................. (.01) (.15) (.04) .05 (.62)
Portfolio turnover rate (%)............................... 15 8 14 6 7
</TABLE>
14
<PAGE> 15
- ------------------------------------------------
CLASS C
- ------------------------------------------------
<TABLE>
<CAPTION>
for the period
April 30, 1996
for the year ended (Commencement)
December 31, to December 31,
-------------------------------------------
1998 1997 1996
-------------------------------------------
<S> <C> <C>
$ 38.64 $ 35.58 $ 32.68
-------------------------------------------
-- (.05) --
2.50 3.42 3.74
-------------------------------------------
2.50 3.37 3.74
-------------------------------------------
-- .01 --
-- -- .20
.22 .21 .64
.13 .09 --
-------------------------------------------
.35 .31 .84
-------------------------------------------
$ 40.79 $ 38.64 $ 35.58
-------------------------------------------
-------------------------------------------
6.46(a) 9.50(a) 11.45(b)
$154,378 $174,880 $44,450
2.40 2.41 2.44(c)
.01 (.14) (.03)(c)
15 8 14
</TABLE>
- ----------------------------------------------------------------------
CLASS I
- ----------------------------------------------------------------------
(a) Total
return does
not reflect a
sales charge.
(b) Total
return
represents
aggregate
total return
and does not
reflect a
sales charge.
(c) Annualized
- ----------------------------------------------------------------------
<TABLE>
<CAPTION>
for the period
October 6, 1994
for the year ended (Commencement)
December 31, to December 31,
---------------------------------------------------------------
1998 1997 1996 1995 1994
---------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 39.06 $ 35.89 $ 30.67 $ 27.60 $ 29.06
---------------------------------------------------------------
.55 .32 .27 .30 .03
2.48 3.56 5.88 3.22 (.49)
---------------------------------------------------------------
3.03 3.88 6.15 3.52 (.46)
---------------------------------------------------------------
.53 .32 .27 .30 .03
-- -- .02 -- --
.22 .28 .64 .12 .92
.13 .11 -- .03 --
-- -- -- -- .05
---------------------------------------------------------------
.88 .71 .93 .45 1.00
---------------------------------------------------------------
$ 41.21 $ 39.06 $ 35.89 $ 30.67 $ 27.60
---------------------------------------------------------------
---------------------------------------------------------------
7.75(a) 10.87(a) 20.06(a) 12.85(a) (1.64)(b)
$156,999 $115,046 $53,344 $13,020 $ 4,921
1.18 1.18 1.25 1.35 1.41(c)
1.23 1.08 1.16 1.14 .47(c)
15 8 14 6 7
</TABLE>
15
<PAGE> 16
[IVY LEAF LOGO]
- --------------------------------------------------------------------------------
NOTES
- --------------------------------------------------------------------------------
16
<PAGE> 17
Account
Application
FUND USE ONLY
----------------------------
Account Number
----------------------------
Dealer/Branch/Rep
----------------------------
Account Type/Soc Cd
[IVY FUNDS LOGO]
Please mail this application along with your
check to:
Ivy Mackenzie Services Corp.
P.O. Box 3022, Boca Raton, Florida 33431-0922
---------------------------------------------
This application should not be used for
retirement accounts for which Ivy Fund (IBT) is
custodian.
---------------------------------------------
<TABLE>
<S> <C> <C> <C>
1 REGISTRATION
Name
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Address
--------------------------------------------------------------------------------------------
City State Zip
----------------------------------------------------- ----------------- ----------------
Phone # (day) ( ) Phone # (evening) ( )
----------------------------------- -------------------------------
</TABLE>
<TABLE>
<S> <C> <C>
-- Individual -- UGMA/UTMA -- Sole proprietor
-- Joint tenant -- Corporation -- Trust
-- Estate -- Partnership -- Other
Date of trust --------------
--------------------------------- Minor's state of residence
-----------------------
</TABLE>
2 TAX I.D.
<TABLE>
<S> <C> <C>
Citizenship: U.S. Other (please specify):
-- -- -------------------------------------------
Social security # - - or Tax identification # -
--------------- -------------------------------------------
</TABLE>
Under penalties of perjury, I certify by signing
in Section 8 that: (1) the number shown in this
section is my correct taxpayer identification
number (TIN), and (2) I am not subject to backup
withholding because: (a) I have not been notified
by the Internal Revenue Service (IRS) that I am
subject to backup withholding as a result of a
failure to report all interest or dividends, or
(b) the IRS has notified me that I am no longer
subject to backup withholding. (Cross out item
(2) if you have been notified by the IRS that you
are currently subject to backup withholding
because of underreporting interest or dividends
on your tax return.) Please see the "Dividends,
distributions and taxes" section of the
Prospectus for additional information on
completing this section.
3 DEALER INFORMATION
The undersigned ("Dealer") agrees to all
applicable provisions in this Application,
guarantees the signature and legal capacity of
the Shareholder, and agrees to notify IMSC of any
purchases made under a Letter of Intent or Rights
of Accumulation.
Dealer name
-------------------------------------------------------------
Branch office address
---------------------------------------------------
City State Zip
--------------------------------- ---------- --------------
Representative's name
----------------------------------------------------
Representative's # Representative's phone #
------------------- -----------
Authorized signature of dealer
-------------------------------------------
4 INVESTMENTS
A. Enclosed is my check ($1,000 minimum) for
$____________made payable to Ivy International
Fund.
Please invest it in:
----------------------------- Class A
----------------------------- Class B
----------------------------- Class C
----------------------------- Class I shares.
B. I qualify for a reduction or elimination of
the sales charge due to the following
privilege (applies only to Class A shares):
New Letter of Intent (if ROA or 90-day backdate privilege is
---applicable, provide account(s) information below.)
ROA with the account(s) listed below.
---
Existing Letter of Intent with the account(s) listed below.
---
<TABLE>
<S> <C>
Fund name: Fund name:
--------------------------------- ---------------------------------
Account #: Account #:
--------------------------------- ---------------------------------
</TABLE>
If establishing a Letter of Intent, you will need
to purchase Class A shares over a 13-month period
in accordance with the provisions in the
Prospectus. The aggregate amount of these
purchases will be at least equal to the amount
indicated below (see Prospectus for minimum amount
required for reduced sales charges).
$50,000 $100,000 $250,000 $500,000
--- --- --- ---
C. FOR DEALER USE ONLY
<TABLE>
<S> <C> <C> <C>
Confirmed trade orders:
------------------ ------------------ ------------------
Confirm Number Number of Shares Trade Date
</TABLE>
<PAGE> 18
5 DISTRIBUTION OPTIONS
I would like to reinvest dividends and capital gains into additional
shares in this account at net asset value unless a different option is
checked below.
A. --- Reinvest all dividends and capital gains into additional shares
of the same class of a different Ivy fund account.
Fund name: --------------------
Account #: --------------------
B. --- Pay all dividends in cash and reinvest capital gains into
additional shares of the same class in this account or a
different Ivy fund account.
Fund name: --------------------
Account #: --------------------
C. --- Pay all dividends and capital gains in cash.
I REQUEST THE ABOVE CASH DISTRIBUTION, SELECTED IN B OR C ABOVE, BE SENT
TO: ----- the address listed in the registration
----- the special payee listed in Section 7A (by mail)
----- the special payee listed in Section 7B (by EFT)
6 OPTIONAL SPECIAL FEATURES
A. AUTOMATIC INVESTMENT METHOD (AIM)
--- I wish to have my bank account listed in section 7B automatically
debited via EFT on a predetermined frequency and invested into my
Ivy International Fund account listed below.
1. Withdraw $------------ for each time period indicated below and
invest my bank proceeds into the following Ivy International Fund
account:
Share class: __ Class A __ Class B __ Class C
Account #: --------------------
2. Debit my bank account:
--- Annually (on the --- day of the month of ----------------------).
--- Semiannually (on the --- day of the months of
--- and ---).
--- Quarterly (on the --- day of the first/second/third
month of each calendar quarter). (CIRCLE ONE)
--- Monthly* --- once per month on the --- day
--- twice per month on the ----- days
--- 3 times per month on the ----- days
--- 4 times per month on the ----- days
B. SYSTEMATIC WITHDRAWAL PLANS (SWP)**
--- I wish to have my Ivy International Fund account automatically
debited on a predetermined frequency and the proceeds sent to me per
my instructions below.
1. Withdraw ($50 minimum) $----- for each time period indicated
below from the following Ivy International Fund account:
Share class: __ Class A __ Class B __ Class C
Account #: --------------------
2. Withdraw from my Ivy International Fund account:
--- Annually (on the ----- day of the month of
----------).
---Semiannually (on the ----- day of the months of
----- and -----).
--- Quarterly (on the ----- day of the first/second/third
month of each calendar quarter. (CIRCLE ONE)
--- Monthly*--- once per month on the ---- day
--- twice per month on the ---- days
--- 3 times per month on the ---- days
--- 4 times per month on the ---- days
3. I request the withdrawal proceeds be:
--- sent to the address listed in the registration
--- sent to the special payee listed in section 7A or 7B.
--- invested into additional shares of the same class of a
different Ivy fund:
Fund name: --------------------
Account #: --------------------
Note: A minimum balance of $5,000 is required to establish a SWP.
6. OPTIONAL SPECIAL FEATURES (CONT.)
C. FEDERAL FUNDS WIRE
FOR REDEMPTION PROCEEDS** --- yes --- no
By checking "yes" immediately above, I authorize IMSC to honor telephone
instructions for the redemption of Fund shares up to $50,000. Proceeds may
be wire transferred to the bank account designated ($1,000 minimum).
(COMPLETE SECTION 7B).
D. TELEPHONE EXCHANGES** --- yes --- no
By checking "yes" immediately above, I authorize exchanges by telephone
among the Ivy funds upon instructions from any person as more fully
described in the Prospectus. To change this option once established,
written instructions must be received from the shareholder of record or
the current registered representative.
If neither box is checked, the telephone exchange privilege will be
provided automatically.
E. TELEPHONIC REDEMPTIONS** --- yes --- no
By checking "yes" immediately above, the Fund or its agents are authorized
to honor telephone instructions from any person as more fully described in
the Prospectus for the redemption of Fund shares. The amount of the
redemption shall not exceed $50,000 and the proceeds are to be payable to
the shareholder of record and mailed to the address of record. To change
this option once established, written instructions must be received from
the shareholder of record or the current registered representative.
If neither box is checked, the telephone redemption privilege will be
provided automatically.
* There must be a period of at least seven calendar days between each
investment (AIM)/withdrawal (SWP) period.
** This option may not be used if shares are issued in certificate form.
7 SPECIAL PAYEE
A. MAILING ADDRESS: Please send all disbursements to this payee:
Name of bank or individual -----------------------------------------------
Account # (if applicable) ------------------------------------------------
Street -------------------------------------------------------------------
City ---------------------------- State ---------------------- Zip -----
B. FED WIRE/EFT INFORMATION
Financial institution ----------------------------------------------------
ABA # --------------------------------------------------------------------
Account # ----------------------------------------------------------------
Street -------------------------------------------------------------------
City ---------------------------- State ---------------------- Zip -----
(PLEASE ATTACH A VOIDED CHECK.)
8 SIGNATURES
Investors should be aware that the failure to check "No" under Section
6D or 6E above means that the Telephone Exchange/ Redemption Privileges
will be provided. The Fund employs reasonable procedures that require
personal identification prior to acting on exchange/redemption
instructions communicated by telephone to confirm that such instructions
are genuine. In the absence of such procedures, the Fund may be liable for
any losses due to unauthorized or fraudulent telephone instructions.
Please see "How to exchange shares" and "How to redeem shares" in the
Prospectus for more information on these privileges.
I certify to my legal capacity to purchase or redeem shares of the
Fund for my own account or for the account of the organization named in
Section 1. I have received a current Prospectus and understand its terms
are incorporated in this application by reference. I am certifying my
taxpayer information as stated in Section 2.
THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE YOUR CONSENT TO ANY
PROVISION OF THIS DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID
BACKUP WITHHOLDING.
---------------------------------------- --------------------
Signature of Owner, Custodian, Trustee or Date
Corporate Officer
---------------------------------------- --------------------
Signature of Joint Owner, Co-Trustee or Date
Corporate Officer
(Remember to sign Section 8)
DETACH ON PERFORATION TO MAIL
<PAGE> 19
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- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
-- QUOTRON SYMBOLS AND CUSIP NUMBERS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------
CLASS SYMBOL CUSIP
- ----------------------------------------------------------------------------------------
<S> <C> <C>
Ivy International Fund Class A IVINX 465903102
Ivy International Fund Class B IVIBX 465903201
Ivy International Fund Class C IVNCX 465897585
Ivy International Fund Class I IVIIX 465897874
- ----------------------------------------------------------------------------------------
</TABLE>
<PAGE> 20
(Ivy Funds Logo)
-- HOW TO RECEIVE MORE
INFORMATION ABOUT THE FUND
Additional information about the Fund and its investments is contained
in the Fund's Statement of Additional Information dated May 3, 1999
(the "SAI"), which is incorporated by reference into this Prospectus,
and the Fund's annual and semiannual reports to shareholders. The
Fund's annual report includes a discussion of the market conditions and
investment strategies that significantly affected the Fund's
performance during its most recent fiscal year. The SAI and annual and
semiannual reports are available upon request and without charge from
the Distributor at the following address and phone number.
Ivy Mackenzie Distributors, Inc.
Via Mizner Financial Plaza
700 South Federal Highway, Ste. 300
Boca Raton, FL 33432
800.456.5111
Information about the Fund (including the SAI and annual and semiannual
reports) may also be reviewed and copied at the SEC's Public Reference
Room in Washington, D.C. (please call 1-800-SEC-0330 for further
details). Information about the Fund is also available on the SEC's
Internet Website (www.sec.gov), and copies of this information may be
obtained, upon payment of a copying fee, by writing the Public
Reference Section of the SEC, Washington, D.C. 20549-6009.
Investment Company Act File No. 811-1028
01IIFXX0699
-- SHAREHOLDER
INQUIRIES
Please call
Ivy Mackenzie
Services Corp.,
the Fund's transfer agent,
regarding any other
inquiries about the Fund
at 1.800.777.6472,
e-mail us at
[email protected]
or visit our web site at
www.ivymackenzie.com.
