INVESCO Value Equity Fund
INVESCO Total Return Fund
INVESCO Intermediate Government Bond Fund
Supplement to Prospectuses of Above Funds Dated December 30, 1994
The cover page of the above Funds' Prospectuses is amended to delete the
following sentences which currently appear in the second paragraph of the cover
page:
Investors purchasing shares of any of these three funds will
be required to meet stringent minimum initial investment
requirements. See the section of this Prospectus entitled "How
Shares Can Be Purchased."
The section of the INVESCO Value Equity Fund's and INVESCO Total Return Fund's
Prospectuses entitled "Investment Objective and Policies" is amended to revise
the fourth sentence of the second paragraph of this section to have it read:
"The Trust has not established any minimum investment standards, such as an
issuer's asset level, earnings, history, type of industry, dividend payment
history, etc. with respect to the Fund's investments in common stocks, although
in selecting common stocks for the Fund the portfolio manager(s) generally apply
an investment discipline which seeks to achieve a yield higher than the overall
equity market."
The section of all three of the above Funds' Prospectuses entitled "How Shares
Can Be Purchased" is amended to: (1) delete the first and fourth paragraphs of
this section concerning minimum investment requirements of the Funds, and
substitute the following new paragraph for the deleted paragraphs as the third
paragraph of this section:
The minimum initial purchase must be at least $1,000, with subsequent
investments of not less than $50, except that: (1) those shareholders
establishing an EasiVest or direct payroll purchase account, as described below
in the Prospectus section entitled "Services Provided by the Fund," may open an
account without making any initial investment if they agree to make regular,
minimum purchases of at least $50; (2) Fund management may permit a lesser
amount to be invested in the Fund under a federal income tax-deferred retirement
plan (other than an Individual Retirement Account ("IRA")), or under a group
investment plan qualifying as a sophisticated investor; (3) those shareholders
investing in an IRA, or through omnibus accounts where individual shareholder
recordkeeping and sub-accounting are not required, may make initial minimum
purchases of $250; and (4) Fund management reserves the right to reduce or waive
the minimum purchase requirements in its sole discretion where it determines
such action is in the best interests of the Fund. The minimum initial purchase
requirement of $1,000, as described above, does not apply to shareholder
account(s) in any of the INVESCO funds opened prior to January 1, 1993, and thus
is not a minimum balance requirement for those existing accounts. However, for
shareholders already having accounts in any of the INVESCO funds, all initial
share purchases in a new fund account, including those made using the exchange
privilege, must meet the fund's applicable minimum investment requirement.
The date of this Supplement is July 19, 1995.
<PAGE>
PROSPECTUS
December 30, 1994
INVESCO VALUE TRUST
INVESCO Total Return Fund
INVESCO Total Return Fund (the "Fund") seeks to achieve a high total
return on investment through capital appreciation and current income by
investing in a combination of equity securities (consisting of common stocks
and, to a lesser degree, securities convertible into common stock) and fixed
income securities. The equity securities purchased by the Fund generally will be
issued by companies which are listed on a national securities exchange and which
usually pay regular dividends. This Fund seeks reasonably consistent total
returns over a variety of market cycles.
The Fund is a series of INVESCO VALUE TRUST (the "Trust"), an open-end
management investment company consisting of three separate portfolios of
investments. This Prospectus relates to shares of INVESCO Total Return Fund.
Separate Prospectuses are available upon request from INVESCO Funds Group, Inc.
for the Trust's other two funds, INVESCO Value Equity Fund and INVESCO
Intermediate Government Bond Fund. Investors purchasing shares of any of the
three funds will be required to meet stringent minimum initial investment
requirements. See the section in this Prospectus entitled "How Shares Can Be
Purchased." Investors may purchase shares of any or all funds. Additional funds
may be offered in the future.
This Prospectus provides you with the basic information you should know
before investing in INVESCO Total Return Fund. You should read it and keep it
for future reference. A Statement of Additional Information containing further
information about the Fund has been filed with the Securities and Exchange
Commission. You can obtain a copy without charge by writing INVESCO Funds Group,
Inc., Post Office Box 173706, Denver, Colorado 80217-3706; or by calling
1-800-525-8085.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE. SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY, ANY BANK OR OTHER FINANCIAL INSTITUTION.
THE SHARES OF THE FUND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY
OTHER AGENCY.
----------
THE STATEMENT OF ADDITIONAL INFORMATION, DATED DECEMBER 30, 1994, IS HEREBY
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS.
<PAGE>
TABLE OF CONTENTS
Page
ANNUAL FUND EXPENSES 4
FINANCIAL HIGHLIGHTS 6
PERFORMANCE DATA 8
INVESTMENT OBJECTIVE AND POLICIES 8
RISK FACTORS 11
THE TRUST AND ITS MANAGEMENT 15
HOW SHARES CAN BE PURCHASED 18
SERVICES PROVIDED BY THE TRUST 20
HOW TO REDEEM SHARES 23
DIVIDENDS, CAPITAL GAIN DISTRIBUTIONS, AND TAXES 25
ADDITIONAL INFORMATION 26
ANNUAL FUND EXPENSES
The Fund is 100% no-load; there are no fees to purchase, exchange or
redeem shares, nor any ongoing marketing ("12b-1") expenses. Lower expenses
benefit Fund shareholders by increasing the Fund's total return.
Shareholder Transaction Expenses
Sales load "charge" on purchases None
Sales load "charge" on reinvested dividends None
Redemption fees None
Exchange fees None
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fee 0.75%
12b-1 Fees None
Other Expenses 0.21%
Transfer Agency Fee(1) 0.10%
General Services, Administrative
Services, Registration, Postage(2) 0.11%
Total Portfolio Operating Expenses 0.96%
(1) Consists of the transfer agency fee described under
"Additional Information - Transfer and Dividend Disbursing Agent."
<PAGE>
(2) Includes, but is not limited to, fees and expenses of trustees,
custodian bank, legal counsel and auditors, a securities pricing service, costs
of administrative services furnished under an Administrative Services Agreement,
costs of registration of Fund shares under applicable laws, and costs of
printing and distributing reports to shareholders.
Example
A shareholder would pay the following expenses on a $1,000 investment for
the periods shown, assuming (1) a 5% annual return and (2) redemption at the end
of each time period:
1 Year 3 Years 5 Years 10 Years
$10 $31 $53 $118
The purpose of the foregoing table is to assist investors in understanding
the various costs and expenses that an investor in the Fund will bear directly
or indirectly. Such expenses are paid from the Fund's assets. (See "The Trust
and Its Management.") The above figures for INVESCO Total Return Fund are based
on fiscal year-end information. The Fund charges no sales load, redemption fee
or exchange fee and bears no distribution expenses. The Example should not be
considered a representation of past or future expenses, and actual expenses may
be greater or less than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual returns, which may be greater or less than the assumed amount.
<PAGE>
Financial Highlights
(For a Fund Share Outstanding throughout Each Period)
The following information for the fiscal year ended August 31, 1994, the
eight-month fiscal period end August 31, 1993 and the four years ended December
31, 1992 has been audited by Price Waterhouse LLP, independent accountants,
whose unqualified report thereon appears in the Statement of Additional
Information. Prior years' information was audited by another independent
accounting firm. This information should be read in conjunction with the audited
financial statements appearing in the Trust's 1994 annual report to shareholders
and in the Statement of Additional Information, both of which are available
without charge by contacting: INVESCO Funds Group, Inc., at the address or
telephone number on the cover of this Prospectus. All per share data has been
adjusted to reflect an 80 to 1 stock split which was effected on January 2,
1991.
<TABLE>
<CAPTION>
Year Period Period
Ended Ended Ended
August 31 August 31 Year Ended December 31 December 31
<S> <C> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------
1994 1993@ 1992 1991 1990 1989 1988 1987~
PER SHARE DATA
Net Asset Value --
Beginning of Period $18.27 $17.18 $16.43 $14.21 $15.08 $13.46 $12.56 $12.50
-----------------------------------------------------------------------------------
INCOME FROM
INVESTMENT OPERATIONS
Net Investment Income 0.69 0.40 0.66 0.71 0.74 0.79 0.39 0.22
Net Gains or (Losses) on Securities
(Both Realized and Unrealized) 0.60 1.09 0.93 2.78 (0.80) 1.74 0.93 0.00
-----------------------------------------------------------------------------------
Total from Investment Operations 1.29 1.49 1.59 3.49 (0.06) 2.53 1.32 0.22
------------------------------------------------------------------------------------
LESS DISTRIBUTIONS
Dividends from Net
Investment Income 0.60 0.40 0.65 0.72 0.75 0.78 0.40 0.16
In Excess of Net Investment Income 0.09 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Distributions from Capital Gains 0.17 0.00 0.19 0.55 0.06 0.13 0.02 0.00
In Excess of Capital Gains 0.16 0.00 0.00 0.00 0.00 0.00 0.00 0.00
------------------------------------------------------------------------------------
Total Distributions 1.02 0.40 0.84 1.27 0.81 0.91 0.42 0.16
------------------------------------------------------------------------------------
Net Asset Value -- End of Period $18.54 $18.27 $17.18 $16.43 $14.21 $15.08 $13.46 $12.56
====================================================================================
TOTAL RETURN 7.22% 8.72%+ 9.84% 24.96% (0.35%) 19.13% 11.53% 1.72%+
RATIOS
Net Assets -- End of Period
($000 Omitted) $292,765 $220,224 $137,196 $82,219 $54,874 $44,957 $28,432 $219
Ratio of Expenses to Average
Net Assets# 0.96% 0.93%* 0.88% 0.92% 1.00% 1.00% 1.00% 0.81%
Ratio of Net Investment
Income to Average Net Assets# 3.31% 3.51%* 4.06% 4.62% 5.22% 5.46% 5.56% 6.44%
Portfolio Turnover Rate 12% 19%+ 13% 49% 24% 28% 13% 0%+
<FN>
@ From January 1, 1993 to August 31, 1993, the Fund's current fiscal year-end.
~ From September 22, 1987, commencement of operations, to December 31, 1987.
+ These amounts are based on operations for the period shown and, accordingly,
are not representative of a full year.
# Various expenses of the Fund were voluntarily absorbed by INVESCO Funds
Group, Inc. for the years ended December 31, 1989, 1988 and 1987. If such
expenses had not been voluntarily absorbed, ratio of expenses to average
net assets would have been 1.05%, 1.21 % an 2.00%, respectively, and ratio
of net investment income to average net assets would have been 5.41%,
5.35% and 5.25%, respectively.
* Annualized
</FN>
</TABLE>
Further information about the performance of the Fund is contained in the
Fund's annual report to shareholders which may be obtained without charge by
writing INVESCO Funds Group, Inc., P.O. Box 173706, Denver, Colorado 80217-3706;
or by calling 1-800-525-8085.
<PAGE>
PERFORMANCE DATA
From time to time, the Fund will advertise its total return performance.
These figures are based upon historical earnings and are not intended to
indicate future performance. The "total return" of a Fund refers to the average
annual rate of return of an investment in the Fund. This figure is computed by
calculating the percentage change in value of an investment of $1,000, assuming
reinvestment of all income dividends and capital gain distributions, to the end
of a specified period. Since the Fund has not been in existence as long as ten
years, periods of one year, five years and life of the Fund are used. "Total
return" quotations reflect the performance of the Fund and include the effect of
capital changes. The Fund charges no sales load, redemption fee, or exchange fee
which would affect the total return computation.
In conjunction with performance reports and/or analyses of shareholder
service for the Fund, comparative data between the Fund's performance for a
given period and recognized bond indices and indices of investment results for
the same period, and/or assessments of the quality of shareholder service, may
be provided to shareholders. Such indices include indices provided by Dow Jones
& Company, Standard & Poor's, Lipper Analytical Services, Inc., Lehman Brothers,
National Association of Securities Dealers Automated Quotations, Frank Russell
Company, Value Line Investment Survey, the American Stock Exchange, Morgan
Stanley Capital International, Wilshire Associates, the Financial Times Stock
Exchange, the New York Stock Exchange, the Nikkei Stock Average and the Deutcher
Aktienindex, all of which are unmanaged market indicators. In addition,
rankings, ratings, and comparisons of investment performance and/or assessments
of the quality of shareholder service appearing in publications such as Money,
Forbes, Kiplinger's Personal Finance, Morningstar, and similar sources which
utilize information compiled (i) internally; (ii) by Lipper Analytical Services,
Inc.; or (iii) by other recognized analytical services, may be used in
advertising. The Lipper Analytical Services, Inc. mutual fund rankings and
comparisons, which may be used by the Fund in performance reports, will be drawn
from the "Flexible Portfolio Funds" Lipper mutual fund groupings, in addition to
the broad-based Lipper general fund grouping.
INVESTMENT OBJECTIVE AND POLICIES
The Trust consists of three separate portfolios of investments (referred
to as the "Funds"), each represented by a different class of the Trust's shares.
This Prospectus relates to INVESCO Total Return Fund; separate Prospectuses for
INVESCO Value Equity Fund and INVESCO Intermediate Government Bond Fund are
available. The investment objective of the Fund is to seek a high total return
on
<PAGE>
investment through capital appreciation and current income. Funds having an
investment objective of seeking a high total return may be limited in their
ability to obtain their objective by the limitations on the types of securities
in which they may invest. Therefore no assurance can be given that the Fund will
be able to achieve its investment objective.
The Fund intends to accomplish its objectives by investing in a
combination of equity securities and fixed income securities. The equity
securities to be acquired by the Fund will consist of common stocks and, to a
lesser extent, securities convertible into common stocks. Such securities
generally will be issued by companies which are listed on a national securities
exchange, such as the New York Stock Exchange, and which usually pay regular
dividends, although the Fund also may invest in securities traded on regional
stock exchanges or on the over-the-counter market. The Trust has not established
any minimum investment standards, such as an issuer's asset level, earnings
history, type of industry, dividend payment history, etc., with respect to the
Fund's investments in common stocks. Therefore, since smaller companies may be
subject to more significant losses, as well as have the potential for more
substantial growth, than larger, more established companies, investors in the
Fund should consider that the Fund's investments may consist in part of
securities which may be deemed to be speculative.
The income securities to be acquired by the Fund primarily will include
obligations of the United States government and its agencies. These United
States government obligations consist of direct obligations of the U.S.
government (U.S. Treasury Bills, Notes and Bonds), obligations guaranteed by the
U.S. government, such as Government National Mortgage Association obligations,
and obligations of U.S. government authorities, agencies and instrumentalities,
which are supported only by the assets of the issuer, such as the Federal
National Mortgage Association, Federal Home Loan Bank, Federal Financing Bank
and Federal Farm Credit Bank. The Fund also may invest in corporate debt
obligations which are rated by Moody's Investors Service, Inc. ("Moody's") in
its four highest ratings of corporate obligations (Aaa, Aa, A and Baa) or by
Standard & Poor's Ratings Group ("Standard & Poor's") in its four highest
ratings of corporate obligations (AAA, AA, A and BBB), or, if not rated, which
in management's opinion have investment characteristics similar to those
described in such ratings. A bond rating of Baa by Moody's indicates that the
bond issue is of "medium grade," neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present, but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics, and have speculative characteristics as well. A bond rating of
BBB by Standard & Poor's indicates that the bond issue is in the lowest
"investment grade" security rating. Bonds rated BBB are regarded as having an
adequate capacity to pay principal and interest. Whereas they normally exhibit
adequate protection parameters,
<PAGE>
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay principal and interest for bonds in this category
than for bonds in the A category, and they may have speculative characteristics.
(See Appendix A to the Statement of Additional Information for specific
descriptions of these corporate bond rating categories). Although there is no
limitation on the maturity of the Fund's investment in income securities, the
dollar weighted average maturity of such investments normally will be from 3 to
15 years.
Obligations of certain U.S. government agencies and instrumentalities may
not be supported by the full faith and credit of the United States. Some are
backed by the right of the issuer to borrow from the U.S. Treasury; others, such
as the Federal National Mortgage Association, by discretionary authority of the
U.S. government to purchase the agencies' obligations; while still others, such
as the Student Loan Marketing Association, are supported only by the credit of
the instrumentality. In the case of securities not backed by the full faith and
credit of the United States, the Fund must look principally to the agency
issuing or guaranteeing the obligation for ultimate repayment, and may not be
able to assert a claim against the United States itself in the event the agency
or instrumentality does not meet its commitments. The Fund will invest in
securities of such instrumentalities only when its investment adviser and
sub-adviser are satisfied that the credit risk with respect to any such
instrumentality is minimal.
Typically, the Fund will maintain a minimum investment in equities of 30%
of total assets, and a 30% minimum will be invested in fixed and variable income
securities. The remaining 40% of the portfolio will vary in asset allocation
according to management's assessment of business, economic, and market
conditions. The analytical process associated with making allocation decisions
is based upon a combination of demonstrated historic financial results, current
prices for stocks, and the current yield to maturity available in the market for
bonds. The premium return available from one category relative to the other
determines the actual asset deployment. Management's asset allocation process is
systematic and is based on current information rather than forecasted change.
The Fund seeks reasonably consistent returns over a variety of market cycles.
(See "Risk Factors" section of this Prospectus for an analysis of the risks
presented by this Fund's ability to enter into contracts for the future delivery
of fixed income securities commonly referred to as "interest rate futures
contracts," and its ability to use options to purchase or sell interest rate
futures contracts or debt securities and to write covered call options and cash
secured puts.)
The investment objective of the Fund and its investment policies, except
where indicated to the contrary, are deemed to be fundamental policies and thus
may not be changed without prior approval by the holders of a majority of the
outstanding voting securities of the Fund, as defined in the Investment Company
Act of 1940. In addition, the Trust and this Fund are subject to certain
<PAGE>
investment restrictions which are set forth in the Statement of Additional
Information and which may not be altered without approval of the Fund's
shareholders. One of those restrictions limits the Fund's borrowing of money to
borrowings from banks for temporary or emergency purposes (but not for
leveraging or investment) in an amount not exceeding 33 1/3% of the value of the
Fund's total assets.
RISK FACTORS
Investors should consider the special factors associated with the policies
discussed below in determining the appropriateness of an investment in the
INVESCO Total Return Fund. The Fund's policies regarding investments in foreign
securities and foreign currencies are not fundamental and may be changed by vote
of the Trust's board of trustees.
Foreign Securities. The Fund may invest up to 25% of its total assets in
foreign equity or debt securities. Investments in securities of foreign
companies and in foreign markets involve certain additional risks not associated
with investments in domestic companies and markets, including the risks of
fluctuations in foreign currency exchange rates and of political or economic
instability, the difficulty of predicting international trade patterns, and the
possibility of imposition of exchange controls or currency blockage. In
addition, there may be less information publicly available about a foreign
company than about a domestic company, and there is generally less government
regulation of stock exchanges, brokers, and listed companies abroad than in the
United States. Moreover, with respect to certain foreign countries, there may be
a possibility of expropriation or confiscatory taxation. Further, economies of
particular countries or areas of the world may differ favorably or unfavorably
from the economy of the United States.
Forward Foreign Currency Contracts
The Fund may enter into contracts to purchase or sell foreign currencies
at a future date ("forward contracts") as a hedge against fluctuations in
foreign exchange rates pending the settlement of transactions in foreign
securities or during the time the Fund holds foreign securities. A forward
contract is an agreement between contracting parties to exchange an amount of
currency at some future time at an agreed upon rate. Although the Fund has not
adopted any limitations on its ability to use forward contracts as a hedge
against fluctuations in foreign exchange rates, it does not attempt to hedge all
of its foreign investment positions, and will enter into forward contracts only
to the extent, if any, deemed appropriate by its investment adviser. The Fund
will not enter into a forward contract for a term of more than one year or for
purposes of speculation. Investors should be aware that hedging against a
decline in the value of a currency in the foregoing manner does not eliminate
fluctuations in the prices of portfolio securities or prevent losses if the
prices of such
<PAGE>
securities decline. Furthermore, such hedging transactions may preclude the
opportunity for gain if the value of the hedged currency should rise. No
predictions can be made with respect to whether the total of such transactions
will result in a better or a worse position than had the Fund not entered into
any forward contracts. Forward contracts may, from time to time, be considered
illiquid, in which case they would be subject to the Fund's limitation on
investing in illiquid securities, discussed below. For additional information
regarding foreign securities, see the Trust's Statement of Additional
Information.
Repurchase Agreements. The Fund may engage in repurchase agreements with
banks, registered broker-dealers, and registered government securities dealers,
which are deemed creditworthy. A repurchase agreement is a transaction in which
the Fund purchases a security and simultaneously commits to sell the security to
the seller at an agreed upon price and date (usually not more than seven days)
after the date of purchase. The resale price reflects the purchase price plus an
agreed upon market rate of interest which is unrelated to the coupon rate or
maturity of the purchased security. The Fund's risk is limited to the ability of
the seller to pay the agreed upon amount on the delivery date. However, in the
event the seller should default, the underlying security constitutes collateral
for the seller's obligations to pay. This collateral will be held by the
custodian for the Fund's assets. However, in the absence of compelling legal
precedents in this area, there can be no assurance that the Fund will be able to
maintain its rights to such collateral upon default of the issuer of the
repurchase agreement. To the extent that the proceeds from a sale upon a default
in the obligation to repurchase are less than the repurchase price, the Fund
would suffer a loss. Although the Fund has not adopted any limit on the amount
of its total assets that may be invested in repurchase agreements, the Fund
intends that at no time will the market value of its securities subject to
repurchase agreements exceed 20% of the total assets of the Fund.
Illiquid Securities. The Fund may invest from time to time in securities
subject to restrictions on disposition under the Securities Act of 1933
("restricted securities"), securities without readily available market
quotations or illiquid securities (those which cannot be sold in the ordinary
course of business within seven days at approximately the valuation given to
them by the Fund). However, on the date of purchase, no such investment may
increase the Fund's holdings of restricted securities to more than 2% of the
value of the Fund's total assets or its holdings of illiquid securities or those
without readily available market quotations to more than 5% of the value of the
Fund's total assets. The Fund is not required to receive registration rights in
connection with the purchase of restricted securities and, in the absence of
such rights, marketability and value can be adversely affected because the Fund
may be unable to dispose of such securities at the time desired or at a
reasonable price. In addition, in order to resell a restricted security, the
Fund might have to bear the expense and incur the delays associated with
<PAGE>
effecting registrations.
Interest Rate Futures Contracts and Options. The Fund may enter into
interest rate futures contracts for hedging or other non-speculative purposes
within the meaning and intent of applicable rules of the Commodity Futures
Trading Commission ("CFTC"). Interest rate futures contracts are purchased or
sold to attempt to hedge against the effects of interest or exchange rate
changes on the Fund's current or intended investments in fixed income
securities. In the event that an anticipated decrease in the value of portfolio
securities occurs as a result of a general increase in interest rates, the
adverse effects of such changes may be offset, in whole or part, by gains on the
sale of interest rate futures contracts. Conversely, the increased cost of
portfolio securities to be acquired, caused by a general decline in interest
rates, may be offset, in whole or part, by gains on interest rate futures
contracts purchased by the Fund. The Fund will incur brokerage fees when it
purchases and sells interest rate futures contracts, and it will be required to
maintain margin deposits.
The Fund also may use options to buy or sell interest rate futures
contracts or debt securities. Such investment strategies will be used as a hedge
and not for speculation.
Put and call options on interest rate futures contracts may be traded by
the Fund in order to protect against declines in the values of portfolio
securities or against increases in the cost of securities to be acquired.
Purchases of options on interest rate futures contracts may present less dollar
risk in hedging the portfolio of the Fund than the purchase and sale of the
underlying interest rate futures contracts, since the potential loss is limited
to the amount of the premium plus related transaction costs. The premium paid
for such a put or call option plus any transaction costs will reduce the
benefit, if any, realized by the Fund upon exercise or liquidation of the
option, and, unless the price of the underlying interest rate futures contract
changes sufficiently, the option may expire without value to the Fund. The
writing of such covered options, however, does not present less risk than the
trading of interest rate futures contracts, and will constitute only a partial
hedge, up to the amount of the premium received, and, if an option is exercised,
the Fund may suffer a loss on the transaction.
The Fund will purchase put or call options on debt securities in
anticipation of changes in interest rates or other factors which may adversely
affect the value of its portfolio or the prices of debt securities which the
Fund anticipates purchasing at a later date. The Fund may be able to offset such
adverse effects on its portfolio, in whole or in part, through the options
purchased. The premium paid for a put or call option plus any transaction costs
will reduce the benefit, if any, realized by the Fund upon exercise or
liquidation of the option, and, unless the price of the underlying security
changes sufficiently, the option may expire without value to the Fund.
<PAGE>
The Fund may, from time to time, also sell ("write") covered call options
or cash secured puts in order to attempt to increase the yield on its portfolio
or to protect against declines in the value of its portfolio securities. Such
covered call options and cash secured puts will not exceed 25% of the Fund's
total assets. By writing a covered call option, the Fund, in return for the
premium income realized from the sale of the option, gives up the opportunity to
profit from a price increase in the underlying security above the option
exercise price, where the price increase occurs while the option is in effect.
In addition, the Fund's ability to sell the underlying security will be limited
while the option is in effect. By writing a cash secured put, the Fund, which
receives the premium, has the obligation during the option period, upon
assignment of an exercise notice, to buy the underlying security at a specified
price. A put is secured by cash if the Fund maintains at all times cash,
Treasury bills or other high grade short-term obligations with a value equal to
the option exercise price in a segregated account with its custodian.
Although the Fund will enter into interest rate futures contracts and
options on debt securities and interest rate futures contracts solely for
hedging or other nonspeculative purposes, within the meaning and intent of
applicable rules of the CFTC, their use does involve certain risks. For example,
a lack of correlation between the value of an instrument underlying an option or
interest rate futures contract and the assets being hedged, or unexpected
adverse price movements, could render the Fund's hedging strategy unsuccessful
and could result in losses. In addition, there can be no assurance that a liquid
secondary market will exist for any contract purchased or sold, and the Fund may
be required to maintain a position until exercise or expiration, which could
result in losses. Further, forward contracts entail particular risks related to
conditions affecting the underlying currency. Forward contracts also involve
risks arising from the lack of an organized exchange trading environment.
Transactions in futures contracts, forward contracts and options are subject to
other risks as well.
The risks related to transactions in options and futures to be entered
into by the Fund are set forth in greater detail in the Statement of Additional
Information, which should be reviewed in conjunction with the foregoing
discussion.
Securities Lending. Consistent with present regulatory policies, including
those of the Board of Governors of the Federal Reserve System and the Securities
and Exchange Commission, the Fund may make loans of its portfolio securities
(not to exceed 10% of the Fund's total assets) to broker-dealers or other
institutional investors under contracts requiring such loans to be callable at
any time and to be secured continuously by collateral in cash, cash equivalents,
high quality short-term government securities or irrevocable letters of credit
maintained on a current basis at an amount at least equal to the market value of
the securities loaned. The Fund will continue to collect the equivalent of the
interest or
<PAGE>
dividends paid by the issuer on the securities loaned and will also receive
either interest (through investment of cash collateral) or a fee (if the
collateral is government securities). The Fund may pay finder's and other fees
in connection with securities loans.
Portfolio Turnover. There are no fixed limitations regarding portfolio
turnover for the Fund. Although the Fund does not trade for short-term profits,
securities may be sold without regard to the time they have been held in the
Fund when, in the opinion of management, market considerations warrant such
action. As a result, while it is anticipated that the Fund's annual portfolio
turnover rate generally will not exceed 100%, under certain market conditions
the portfolio turnover rate for the Fund may exceed 100%. Increased portfolio
turnover would cause the Fund to incur greater brokerage costs than would
otherwise be the case. The Fund's portfolio turnover rates are set forth under
"Financial Highlights" and, along with the Trust's brokerage allocation
policies, are discussed in the Statement of Additional Information.
THE TRUST AND ITS MANAGEMENT
The Trust is a no-load mutual fund, registered with the Securities and
Exchange Commission as an open-end, diversified management investment company.
The Trust was organized on July 15, 1987, under the laws of the Commonwealth of
Massachusetts as "Financial Series Trust." On July 1, 1993, the Trust changed
its name to "INVESCO Value Trust." The overall supervision of the Trust is the
responsibility of its board of trustees.
INVESCO Funds Group, Inc. ("INVESCO"), 7800 E. Union Avenue, Denver,
Colorado, serves as the Trust's investment adviser pursuant to an investment
advisory agreement. Under this agreement, INVESCO provides the Fund with various
management services and supervises the Fund's daily business affairs.
Specifically, INVESCO performs all administrative, clerical, statistical,
secretarial and all other services necessary or incidental to the administration
of the affairs of the Trust, excluding, however, those services that are the
subject of a separate agreement between the Trust and INVESCO or any affiliate
thereof. Services provided pursuant to separate agreement include the
distribution and sale of Trust shares and provision of transfer agency, dividend
disbursing agency, and registrar services, and services furnished under an
Administrative Services Agreement dated as of February 20, 1989, with INVESCO.
The following individuals serve as portfolio managers for the Fund and are
primarily responsible for the day-to-day management of the Fund's portfolio of
securities:
Edward C. Mitchell, Jr., C.F.A. Portfolio manager of the Fund
since 1987; portfolio manager
of the EBI Flex Fund since
1988; president (1992 to
present), vice president (1979
to 1991) and director (1979 to
present) of INVESCO Capital
Management, Inc.; began
investment career in 1969;
<PAGE>
B.A., University of Virginia; M.B.A.,
University of Colorado; Chartered
Financial Analyst; Chartered
Investment Counselor.
David S. Griffin Assistant portfolio manager of
the Fund since 1993; co-
portfolio manager of the EBI
Flex Fund since 1993; portfolio
manager for INVESCO Capital
Management, Inc. (1991 to
present); mutual fund sales
representative, INVESCO
Services, Inc. (1986 to 1991);
began investment career in
1982; B.A., Ohio Wesleyan
University; M.B.A., William and
Mary; Chartered Financial
Analyst.
INVESCO is an indirect wholly-owned subsidiary of INVESCO PLC. INVESCO PLC
is a financial holding company which, through its subsidiaries, engages in the
business of investment management on an international basis. INVESCO was
established in 1932 and, as of August 31, 1994, managed 14 mutual funds,
consisting of 36 separate portfolios with combined assets of approximately $9.9
billion on behalf of over 861,000 shareholders.
INVESCO has contracted with INVESCO Capital Management, Inc. ("ICM"), the
Trust's investment adviser prior to 1991, for investment sub-advisory and
research services on behalf of the Fund. ICM is an indirect, wholly-owned
subsidiary of INVESCO PLC that, as of June 30, 1994, managed approximately $25.3
billion of tax-exempt accounts (such as pension and profit-sharing funds for
corporations and state and local governments) and acted as investment adviser or
sub-adviser to 11 investment portfolios of 5 investment companies (including the
Trust) with combined assets of approximately $1 billion. Although the Trust is
not a party to the sub-advisory agreement, the agreement has been approved by
the shareholders of the Trust. Services provided by INVESCO and ICM are subject
to review by the Trust's board of trustees.
Under the investment advisory agreement the Trust pays INVESCO a monthly
fee at the following annual rates, based on the average net assets of the Fund:
0.75% on the first $500 million of the Fund's average net assets; 0.65% on the
next $500 million of the Fund's average net assets; and 0.50% of the average net
assets of the Fund in excess of $1 billion. While the portion of INVESCO's fees
which is equal to 0.75% of the net assets is higher than those generally charged
by investment advisers to mutual funds, they are not higher than those charged
by most other investment advisers to
<PAGE>
funds of comparable asset levels to the Fund. For the fiscal year ended August
31, 1994, the advisory fees paid to INVESCO Funds Group, Inc. amounted to 0.75%
of the average net assets of the Fund.
Out of its advisory fee which it receives from the Fund, INVESCO pays ICM,
as sub-adviser to the Fund, a monthly fee, which is computed at the annual rate
of 0.20% of the first $500 million of the Fund's average net assets; 0.17% of
the next $500 million of the Fund's average net assets; and 0.13% of the Fund's
average net assets in excess of $1 billion. No fee is paid by the Fund to ICM.
The Fund bears those Trust expenses which are accrued daily that are
incurred on its behalf and, in addition, bears a portion of general Trust
expenses, allocated based upon the relative net assets of the three Funds of the
Trust. Such expenses are generally deducted from the Fund's total income before
dividends are paid. Total expenses of the Fund, including investment advisory
fees (but excluding brokerage commissions), as a percentage of its average net
assets for the fiscal year ended August 31, 1994, were 0.96%.
The Trust also has entered into an Administrative Services Agreement (the
"Administrative Agreement") with INVESCO. Pursuant to the Administrative
Agreement, INVESCO performs certain administrative and internal accounting
services, including without limitation, maintaining general ledger and capital
stock accounts, preparing a daily trial balance, calculating net asset value
daily, and providing selected general ledger reports. For such services, the
Fund pays INVESCO a fee consisting of a base fee of $10,000 per year, plus an
additional incremental fee computed at an annual rate not to exceed a maximum of
0.015% per annum of the average net assets of the applicable Fund.
The Declaration of Trust pursuant to which the Trust is organized contains
an express disclaimer of shareholder liability for acts or obligations of the
Trust and requires that notice of such disclaimer be given in each instrument
entered into or executed by the Trust. The Declaration of Trust also provides
for indemnification out of the Trust's property for any shareholder held
personally liable for any Trust obligation. Thus, the risk of a shareholder
being personally liable for obligations of the Trust is limited to the unlikely
circumstance in which the Trust itself would be unable to meet its obligations.
INVESCO, as the Trust's investment adviser, as well as ICM as sub-adviser
for the Fund, have the responsibility of placing orders for the purchase and
sale of portfolio securities with brokers and dealers based upon their
evaluation of broker-dealer financial responsibility coupled with broker-dealer
ability to effect transactions at the best available prices. Although the Trust
does not market its shares through intermediary brokers or dealers, the Trust
may place orders for portfolio transactions with qualified
<PAGE>
broker-dealers which recommend the various funds of the Trust to clients, or act
as agent in the purchase of fund shares for clients, if management of the Trust
believes that the quality of execution of the transaction and level of
commission are comparable to those available from other qualified brokerage
firms.
HOW SHARES CAN BE PURCHASED
Only the following investors may make initial investments in the INVESCO
Total Return Fund: (1) investors that either make a minimum initial investment
in the Fund of $1 million, or can be anticipated by Trust management to invest
$1 million or more in the Fund within a reasonable period of time; (2)
directors, officers and employees of any company affiliated with INVESCO, and
their immediate family members, who invest a minimum of $1,000 in the Fund; and
(3) investors whose minimum initial investment in the Fund is less than $1
million but whose investment is determined by Trust management to be in the best
interests of the Fund.
Shares of the Fund are sold on a continuous basis by INVESCO, as the
Fund's Distributor, at the net asset value per share next calculated after
receipt of a purchase order in good form. No sales charge is imposed upon the
sale of shares of the Fund. To purchase shares of the Fund, send a check made
payable to INVESCO Funds Group, Inc., together with a completed application
form, to:
INVESCO FUNDS GROUP, INC.
Post Office Box 173706
Denver, Colorado 80217-3706
Purchase orders must specify the Fund in which the investment is to be
made.
Following an initial purchase meeting the Fund's requirements, subsequent
investments may be made in amounts of not less than $50. The minimum initial
purchase requirements described above do not apply to shareholder accounts in
the Fund opened prior to March 1, 1993, and, thus, there are no minimum balance
requirements for those accounts. However, for shareholders already having
accounts in any of the INVESCO funds, all initial share purchases in a new Trust
account, including those made using the exchange privilege, must meet the
Trust's applicable minimum investment requirements.
The purchase of shares in the Fund can be expedited by placing bank wire,
overnight courier, or telephone orders. For further information, the purchaser
may call the Trust's office by using the telephone number on the cover of this
Prospectus. Orders sent by overnight courier, including Express Mail should be
sent to the street address, not Post Office Box, of INVESCO Funds Group, Inc.,
7800 E. Union Avenue, Denver, Colorado 80237.
Shares of the Fund purchased by telephone will be issued at the net asset
value of the Fund next determined after receipt of telephone instructions.
Payments for telephone orders must be
<PAGE>
received by the Trust within seven business days of the transaction. In the
event payment is not received, the shares will be redeemed by INVESCO, and the
purchaser will be held responsible for any loss resulting from a decline in the
value of the shares. INVESCO has agreed to indemnify the Trust for any losses
resulting from such cancellations.
If your check does not clear, or if a telephone purchase must be cancelled
due to nonpayment, you will be responsible for any related loss the Fund or
INVESCO incurs. If you are already a shareholder in the INVESCO funds, the Fund
has the option to redeem shares from any identically registered account in the
Fund or any other INVESCO fund as reimbursement for any loss incurred. You also
may be prohibited or restricted from making future purchases in any of the
INVESCO funds.
Persons who invest in the Fund through a securities broker may be charged
a commission or transaction fee for the handling of the transaction if the
broker so elects. Any investor may deal directly with the Fund in any
transaction. In that event, there is no such charge.
The Fund reserves the right in its sole discretion to reject any order for
purchase of its shares (including purchases by exchange) when, in the judgment
of management, such rejection is in the best interest of the Fund.
Net asset value per share is computed once each day that the New York
Stock Exchange is open as of the close of regular trading on that Exchange
(presently 4:00 p.m., New York time) and also may be computed on other days
under certain circumstances. Net asset value per share for the Fund is
calculated by dividing the market value of the Fund's securities plus the value
of its other assets (including dividends and interest accrued but not
collected), less all liabilities (including accrued expenses), by the number of
outstanding shares of the Fund. If market quotations are not readily available,
a security will be valued at fair value as determined in good faith by the board
of trustees. Debt securities with remaining maturities of 60 days or less will
be valued at amortized cost, absent unusual circumstances, so long as the
Trust's board of trustees believes that such value represents fair value.
Under certain circumstances, the Fund may offer its shares, in lieu of
cash payment, for securities to be purchased by the Fund. Such a transaction can
benefit the Fund by allowing it to acquire securities for its portfolio without
paying brokerage commissions. For the same reason, the transaction also may be
beneficial to the party exchanging the securities. The Fund shall not enter into
such transactions, however, unless the securities to be exchanged for Fund
shares are readily marketable and not restricted as to transfer either by law or
liquidity of the market, comply with the investment policies and objectives of
the Fund, are of the type and quality which would normally be purchased for the
Fund's portfolio,
<PAGE>
are acquired for investment and not for resale, have a value which is readily
ascertainable as evidenced by a listing on the American Stock Exchange, the New
York Stock Exchange or NASDAQ, and are securities which the Fund would otherwise
purchase on the open market. The value of Fund shares used to purchase portfolio
securities as stated herein will be the net asset value as of the effective time
and date of the exchange. The securities to be received by the Fund will be
valued in accordance with the same procedure used in valuing the Fund's
portfolio securities. Any investor wishing to acquire shares of the Fund in
exchange for securities should contact either the President or the Secretary of
the Trust at the address or telephone number shown on the cover page of this
Prospectus.
SERVICES PROVIDED BY THE TRUST
Shareholder Accounts. INVESCO maintains a share account that reflects the
current holdings of each shareholder. A separate account will be maintained for
a shareholder for each Fund in which the shareholder invests. As a business
trust, the Trust does not issue share certificates. Each shareholder is sent a
detailed confirmation of each transaction in shares of the Trust. Shareholders
whose only transactions are through the EasiVest, direct payroll purchase,
automatic monthly exchange or periodic withdrawal programs, or are reinvestments
of dividends or capital gains in the same or another fund, will receive
confirmations of those transactions on their quarterly statements. These
programs are discussed below. For information regarding a shareholder's account
and transactions, the shareholder may call the Trust's office by using the
telephone number on the cover of this Prospectus.
Reinvestment of Distributions. Income dividends and capital gain
distributions are automatically reinvested in additional shares of the Fund at
the net asset value per share of the Fund in effect on the ex-dividend date. A
shareholder may, however, elect to reinvest dividends and capital gain
distributions in certain of the other no-load mutual funds advised and
distributed by INVESCO, or to receive payment of all dividends and distributions
in excess of $10.00 by check by giving written notice to INVESCO at least two
weeks prior to the record date on which the change is to take effect. Further
information concerning these options can be obtained by contacting INVESCO.
Periodic Withdrawal Plan. A Periodic Withdrawal Plan is available to
shareholders who own or purchase shares of any mutual funds advised by INVESCO
having a total value of $10,000 or more; provided, however, that at the time the
Plan is established, the shareholder owns shares having a value of at least
$5,000 in the fund from which the withdrawals will be made. Under the Periodic
Withdrawal Plan, INVESCO, as agent, will make specified monthly or quarterly
payments of any amount selected (minimum payment of $100) to the party
designated by the shareholder. Notice of all changes concerning the Periodic
Withdrawal Plan must be received by INVESCO
<PAGE>
at least two weeks prior to the next scheduled check. Further information
regarding the Periodic Withdrawal Plan and its requirements and tax consequences
can be obtained by contacting INVESCO.
Exchange Privilege. Shares of the Fund may be exchanged for shares of any
other fund of the Trust, as well as for shares of any of the following other
no-load mutual funds, which are also advised and distributed by INVESCO, on the
basis of their respective net asset values at the time of the exchange: INVESCO
Diversified Funds, Inc., INVESCO Dynamics Fund, Inc., INVESCO Emerging Growth
Fund, Inc., INVESCO Growth Fund, Inc., INVESCO Income Funds, Inc., INVESCO
Industrial Income Fund, Inc., INVESCO International Funds, Inc., INVESCO Money
Market Funds, Inc., INVESCO Multiple Asset Funds, Inc., INVESCO Specialty Funds,
Inc., INVESCO Strategic Portfolios, Inc., and INVESCO Tax-Free Income Funds,
Inc.
An exchange involves redemption of shares in the Fund and investment of
the redemption proceeds in shares of another fund of the Trust or in shares of
one of the funds listed above. Exchanges will be made at the net asset value per
share next determined after receipt of an exchange request in proper order. Any
gain or loss realized on such an exchange is recognizable for federal income tax
purposes by the shareholder. Exchange requests may be made either by telephone
or by written request to INVESCO Funds Group, Inc., using the telephone number
or address on the cover of this Prospectus. Exchanges made by telephone must be
in the amount of at least $250, if the exchange is being made into an existing
account of one of the INVESCO funds. All exchanges that establish a new account
must meet the fund's applicable minimum initial investment requirements. Written
exchange requests into an existing account have no minimum requirements other
than the fund's applicable minimum subsequent investment requirements.
The privilege of exchanging Fund shares by telephone is available to
shareholders automatically unless expressly declined. By signing the new account
Application, a Telephone Transaction Authorization Form or otherwise utilizing
telephone exchange privileges, the investor has agreed that the Fund will not be
liable for following instructions communicated by telephone that it reasonably
believes to be genuine. The Fund employs procedures, which it believes are
reasonable, designed to confirm that exchange transactions are genuine. These
may include recording telephone instructions and providing written confirmations
of exchange transactions. As a result of this policy, the investor may bear the
risk of any loss due to unauthorized or fraudulent instructions; provided,
however, that if the Fund fails to follow these or other reasonable procedures,
the Fund may be liable.
In order to prevent abuse of this privilege to the disadvantage of other
shareholders, the Fund reserves the right to terminate the exchange privilege of
any shareholder who requests more than four exchanges in a year. The Fund will
determine whether to do so based on a consideration of both the number of
<PAGE>
exchanges any particular shareholder or group of shareholders has requested and
the time period over which those exchange requests have been made, together with
the level of expense to the Fund which will result from effecting additional
exchange requests. The exchange privilege also may be modified or terminated at
any time. Except for those limited instances where redemptions of the exchanged
security are suspended under Section 22(e) of the Investment Company Act of
1940, or where sales of the fund into which the shareholder is exchanging are
temporarily stopped, notice of all such modifications or termination of the
exchange privilege will be given at least 60 days prior to the date of
termination or the effective date of the modification.
Before making an exchange, the shareholder should review the prospectuses
of the funds involved and consider their differences, and should be aware that
the exchange privilege may only be available in those states where exchanges
legally may be made, which will require that the shares being acquired are
registered for sale in the shareholder's state of residence. Shareholders
interested in exercising the exchange privilege may contact INVESCO for
information concerning their particular exchanges.
Automatic Monthly Exchange. Shareholders who have accounts in any one or
more of the mutual funds distributed by INVESCO may arrange for a fixed dollar
amount of their fund shares to be automatically exchanged for shares of any
other INVESCO mutual fund listed under "Exchange Privilege" on a monthly basis,
subject to the Fund's minimum initial investment or subsequent investment
requirements. This automatic exchange program can be changed by the shareholder
at any time by notifying INVESCO at least two weeks prior to the date the change
is to be made. Further information regarding this service can be obtained by
contacting INVESCO.
EasiVest. For shareholders who want to maintain a schedule of monthly
investments, EasiVest uses various methods to draw a preauthorized amount from
the shareholder's bank account to purchase Fund shares. This automatic
investment program can be changed by the shareholder at any time by writing to
INVESCO at least two weeks prior to the date the change is to be made. Further
information regarding this service can be obtained by contacting INVESCO.
Direct Payroll Purchase. Shareholders may elect to have their employers
make automatic purchases of Fund shares for them by deducting a specified amount
from their regular paychecks. This automatic investment program can be modified
or terminated at any time by the shareholder by notifying the employer. Further
information regarding this service can be obtained by contacting INVESCO.
Tax-Sheltered Retirement Plans. Shares of the Fund may be
purchased for self-employed retirement plans, individual retirement
accounts (IRAs), simplified employee pension plans, and corporate
retirement plans. In addition, shares can be used to fund tax
<PAGE>
qualified plans established under Section 403(b) of the Internal Revenue Code by
educational institutions, including public school systems and private schools,
and certain kinds of non-profit organizations, which provide deferred
compensation arrangements for their employees.
Prototype forms for the establishment of these various plans, including,
where applicable disclosure statements required by the Internal Revenue Service,
are available from INVESCO. INVESCO Trust Company, a subsidiary of INVESCO, is
qualified to serve as trustee or custodian under these plans and provides the
required services at competitive rates. Retirement plans (other than IRAs)
receive monthly statements reflecting all transactions in their Fund accounts.
IRAs receive the confirmations and quarterly statements described under
"Shareholder Accounts." For complete information, including prototype forms and
service charges, call INVESCO at the telephone number listed on the cover of
this Prospectus or send a written request to: Retirement Services, INVESCO Funds
Group, Inc., Post Office Box 173706, Denver, Colorado 80217-3706.
HOW TO REDEEM SHARES
Shares of the Fund may be redeemed at any time at their current net asset
value next determined after a request in proper form is received at the Trust's
office. Redemption requests sent by overnight courier, including Express Mail,
should be sent to the street address, not Post Office Box, of INVESCO Funds
Group, Inc. at 7800 E. Union Avenue, Denver, CO 80237. (See "How Shares Can Be
Purchased.") Net asset value per share of the Fund at the time of the redemption
may be more or less than the price originally paid to purchase shares.
In order to redeem shares, a written redemption request signed by each
registered owner of the account may be submitted to INVESCO at the address noted
above. If shares are held in the name of a corporation, additional documentation
may be necessary. Call or write for specifics. If payment for the redeemed
shares is to be made to someone other than the registered owner(s), the
signature(s) must be guaranteed by a financial institution which qualifies as an
eligible guarantor institution. Redemption procedures with respect to accounts
registered in the names of broker/dealers may differ from those applicable to
other shareholders.
Be careful to specify the account from which the redemption is to be made.
Shareholders have a separate account for each fund in which they invest.
Payments of redemption proceeds will be mailed within seven days following
receipt of the required documents. However, payment may be postponed under
unusual circumstances, such as when normal trading is not taking place on the
New York Stock Exchange, an emergency as defined by the Securities and Exchange
Commission
<PAGE>
exists, or the shares to be redeemed were purchased by check and that check has
not yet cleared; provided, however, that all redemption proceeds will be paid
out promptly upon clearance of the purchase check (which may take up to 15
days).
Because of the high relative costs of handling small accounts, should the
value of any shareholder's account fall below $250 as a result of shareholder
action, the Trust reserves the right to effect the involuntary redemption of all
shares in such account, in which case the account would be liquidated and the
proceeds forwarded to the shareholder. Prior to any such redemption, a
shareholder will be notified and given 60 days to increase the value of the
account to $250 or more.
Fund shareholders (other than shareholders holding Fund shares in accounts
of IRA plans) may request expedited redemption of shares having a minimum value
of $250 (or redemption of all shares if their value is less than $250), held in
accounts maintained in their name by telephoning redemption instructions to
INVESCO, using the telephone number on the cover of this Prospectus. For INVESCO
Trust Company sponsored federal income tax-sheltered retirement plans, the term
"shareholders" is defined to mean plan trustees that file a written request to
be able to redeem Fund shares by telephone. Unless the Fund's management permits
a larger redemption request to be placed by telephone, a shareholder may not
place a redemption request by telephone in excess of $25,000. The redemption
proceeds, at the shareholder's option, either will be mailed to the address
listed for the shareholder on its Fund account, or wired (minimum $1,000) or
mailed to the bank which the shareholder has designated to receive the proceeds
of telephone redemptions. The Fund charges no fee for effecting such telephone
redemptions. These telephone redemption privileges may be modified or terminated
in the future at the discretion of the Fund's management. Shareholders should
understand that while the Fund will attempt to process all telephone redemption
requests on an expedited basis, there may be times, particularly in periods of
severe economic or market disruption, when (a) they may encounter difficulty in
placing a telephone redemption request, and (b) processing telephone redemptions
will require up to seven days following receipt of the redemption request, or
additional time because of the unusual circumstances set forth above.
The privilege of redeeming Fund shares by telephone is available to
shareholders automatically unless expressly declined. By signing a new account
Application, a Telephone Transaction Authorization Form or otherwise utilizing
telephone redemption privileges, the shareholder has agreed that the Fund will
not be liable for following instructions communicated by telephone that it
reasonably believes to be genuine. The Fund employs procedures, which it
believes are reasonable, designed to confirm that telephone instructions are
genuine. These may include recording telephone instructions and providing
written confirmations of transactions initiated by telephone. As a result of
this policy, the investor may bear the risk of any loss due to unauthorized or
<PAGE>
fraudulent instructions; provided, however, that if the Fund fails to follow
these or other reasonable procedures, the Fund may be liable.
DIVIDENDS, CAPITAL GAIN DISTRIBUTIONS, AND TAXES
Dividends. In addition to any increase in the value of Fund shares which
may occur from increases in the value of the Fund's investments, the Fund may
earn income in the form of dividends and interest on its investments. Dividends
paid by the Fund will be based solely on the income earned by the Fund. The
Trust's policy with respect to the Fund is to distribute substantially all of
this income, less expenses, to shareholders in the Fund. Dividend distributions
for the Fund are customarily declared and paid quarterly, at the end of
November, February, May, and August to shareholders in the Fund. Dividends are
automatically reinvested in additional shares of the Fund at the net asset value
on the ex- dividend date, unless otherwise requested. See "Services Provided by
the Trust - Reinvestment of Distributions."
Capital Gains. Capital gains or losses are the result of the Fund's sale
of its securities at prices that are higher or lower than the prices paid by the
Fund to purchase such securities. Total gains from such sales, less any losses
from such sales (including losses carried forward from prior years), represent
net realized capital gains. The Fund distributes its net realized capital gains,
if any, to its shareholders at least annually, usually in December. Capital gain
distributions are automatically reinvested in additional shares of the Fund at
net asset value per share on the ex-dividend date, unless otherwise requested.
See "Services Provided by the Trust - Reinvestment of Distributions."
Taxes. The Fund intends to distribute substantially all of its net
investment income and capital gains, if any, to shareholders, and to continue to
qualify for tax treatment under Subchapter M of the Internal Revenue Code as a
regulated investment company. Thus, it is not expected that the Trust or the
Fund will be required to pay any federal income taxes. Shareholders (other than
those exempt from income tax) normally will have to pay federal income taxes and
any state and local income taxes on the dividends and distributions they receive
from the Trust, whether such dividends and distributions are received in cash or
reinvested in additional shares of the same or another fund. Shareholders of the
Trust are advised to consult their own tax advisers with respect to these
matters.
Dividends paid by the Fund from net investment income, as well as
distributions of net realized short-term capital gains, are, for federal income
tax purposes, taxable as ordinary income to shareholders. At the end of each
calendar year, shareholders are sent full information on dividends and capital
gain distributions, including information as to the portions taxable as ordinary
income and long-term capital gains, and the amount of dividends eligible for the
dividends-received deduction available for corporations.
<PAGE>
During the fiscal year ended August 31, 1994, 52.88% of the dividends declared
by the INVESCO Total Return Fund qualified for the dividends-received corporate
deduction.
The Trust is required to withhold and remit to the U.S. Treasury 31% of
dividend payments, capital gain distributions, and redemption proceeds for any
account on which the owner provides an incorrect taxpayer identification number,
no number, or no certified number.
ADDITIONAL INFORMATION
Voting Rights. All shares of the Trust's Funds have equal voting rights.
When shareholders are entitled to vote upon a matter, each shareholder is
entitled to one vote for each share owned. Voting with respect to certain
matters, such as ratification of independent accountants and the election of
trustees, will be by all Funds of the Trust voting together. In other cases,
such as voting upon the investment advisory contract for the individual Funds,
voting is on a Fund-by-Fund basis. To the extent permitted by law, when not all
Funds are affected by a matter to be voted upon, only shareholders of the Funds
or Funds affected by the matter will be entitled to vote thereon. The Trust is
not generally required and does not expect, to hold regular annual meetings of
shareholders. However, the board of trustees will call such special meetings of
shareholders for the purpose, among other reasons, of voting the question of
removal of a trustee or trustees when requested to do so in writing by the
holders of 10% or more of the outstanding shares of the Trust or as may be
required by applicable law or the Trust's Declaration of Trust. The Trust will
assist shareholders in communicating with other shareholders as required by the
Investment Company Act of 1940. Trustees may be removed by action of the holders
of two-thirds of the outstanding shares of the Trust.
Shareholder Inquiries. All inquiries regarding the Fund should be directed
to the Trust at the telephone number or mailing address set forth on the cover
page of this Prospectus.
Transfer and Dividend Disbursing Agent. INVESCO Funds Group, Inc., 7800 E.
Union Avenue, Denver, Colorado 80237, acts as registrar, transfer agent, and
dividend disbursing agent for the Fund pursuant to a Transfer Agency Agreement
which provides that the Fund will pay a fee of $14.00 per shareholder account or
omnibus account participant per year. The transfer agency fee is not charged to
each shareholder's or participant's account but is an expense of the Fund to be
paid from the Fund's assets. In addition, registered broker-dealers, third party
administrators of tax-qualified retirement plans and other entities may provide
sub- transfer agency services to the Fund which reduce or eliminate the need for
identical services to be provided on behalf of the Fund by INVESCO. In such
cases, INVESCO is authorized to pay the third party an annual sub-transfer
agency fee of up to $14.00 per participant in the third party's omnibus account
out of the transfer agency fee which is paid to INVESCO by the Fund.
<PAGE>
INVESCO VALUE TRUST
PROSPECTUS
December 30, 1994
INVESCO Total Return Fund
To receive general information and prospectuses on any of INVESCO's funds or
retirement plans, or to obtain current account or price information, call
toll-free:
1-800-525-8085
To reach PAL, your 24-hour Personal Account Line call:
1-800-424-8085
Or write to:
INVESCO Funds Group, Inc., Distributor
Post Office Box 173706
Denver, Colorado 80217-3706
If you're in Denver, visit one of our convenient Investor Centers:
Cherry Creek
155-B Fillmore Street
Denver Tech Center
7800 East Union Avenue
Lobby Level
