Rule 497(e)
Registration No. 33-8982
Victory LifeChoice Funds
Conservative Investor Fund
Moderate Investor Fund
Growth Investor Fund
Supplement dated March 23, 1998
to the Prospectus and Statement of Additional Information ("SAI")
dated March 23, 1998
The prospectus and SAI of the Victory LifeChoice Funds listed above (the
"LifeChoice Funds" or the"Funds") are supplemented as follows.
The Victory Portfolios and Key Asset Management Inc. (the "Applicants")
have filed an application with the Securities and Exchange Commission (the
"SEC") requesting an order that would allow the Funds to offer all of the
current and future classes of its shares with a sales load that exceeds 1.5%. If
the SEC grants the order, you will pay up to a 5.75% sales charge on future
purchases of the Funds listed above. As of the date of this supplement, the SEC
has not issued the order. Until the SEC issues an order (and there can be no
assurance that it will), the Funds will offer their shares without a sales
charge, all references to sales charges in the prospectus and SAI will not
apply, and the prospectus is revised as follows:
1. The following replaces the entire section on page 4 titled "Fund Expenses:"
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
FUND EXPENSES
- -----------------------------------------------------------------------------------------------------------------------
This section will help you understand the costs and expenses you would pay,
directly or indirectly, if you invest in the Funds.
- ----------------------------------------------------------- ------------------ -------------------- -------------------
CONSERVATIVE MODERATE GROWTH
SHAREHOLDER TRANSACTION EXPENSES* INVESTOR FUND INVESTOR FUND INVESTOR FUND
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price) None None None
Sales Charge Imposed on Reinvested Dividends None None None
Deferred Sales Charge None None None
Redemption Fees None None None
Exchange Fees None None None
- ----------------------------------------------------------- ------------------ -------------------- -------------------
*You may be charged additional fees if you purchase, exchange, or redeem
shares through a broker or agent.
The Annual Fund Operating Expenses table below illustrates the estimated
operating expenses that you will incur as a shareholder of the Funds. THESE
EXPENSES ARE CHARGED DIRECTLY TO EACH FUND. Expenses include management fees, as
well as the costs of maintaining accounts, administering the Funds, providing
shareholder services, and other activities. The expenses shown are estimated
based on historical or projected expenses of the Funds adjusted to reflect
anticipated expenses.
- --------------------------------------------------- --------------------- ------------------------ --------------------
ANNUAL FUND OPERATING EXPENSES
(AFTER Expense Waivers and Reimbursements) CONSERVATIVE MODERATE GROWTH
(as a percentage of average daily net assets): INVESTOR FUND INVESTOR FUND INVESTOR FUND
Management Fee(1) .10% .10% .10%
Other Expenses(1) .10% .10% .10%
---- ---- ----
Total Fund Operating Expenses(1) .20% .20% .20%
==== ==== ====
- --------------------------------------------------- --------------------- ------------------------ --------------------
(1)These fees have been voluntarily reduced. These waivers may be terminated at any time. Without this waiver or
reimbursement, the expenses of the Funds would be as follows:
ANNUAL FUND OPERATING EXPENSES
(BEFORE Expense Waivers and Reimbursements) CONSERVATIVE MODERATE GROWTH
(as a percentage of average daily net assets): INVESTOR FUND INVESTOR FUND INVESTOR FUND
Management Fee without waivers .20% .20% .20%
Other Expenses without reimbursements 1.08% .70% .85%
---- --- ---
Total Fund Operating Expenses without waivers
or reimbursements 1.28% .90% 1.05%
==== === ====
<PAGE>
The following example is designed to help you understand the various costs you
will bear, directly or indirectly, as an investor in the Funds. This example is
based on and the estimated expenses of the Funds and the average annual weighted
expense ratios of the mutual funds in which the Funds invest (see page 9 for the
underlying expenses of the Funds). Total estimated expenses of the Conservative
Investor Fund, the Moderate Investor Fund, and the Growth Investor Fund are
1.33%, 1.44%, and 1.53%, respectively.
EXAMPLE: You would pay the following expenses on a $1,000 investment in the Funds, assuming: (1) a 5% annual
return and (2) redemption at the end of each time period.
- ---------------------------------------- ------------------------ ------------------ ----------------- ----------------
1 Year 3 Years 5 Years 10 Years
Conservative Investor Fund $14 $42 $73 $160
Moderate Investor Fund $15 $46 $79 $172
Growth Investor Fund $16 $48 $83 $182
- ---------------------------------------- ------------------------ ------------------ ----------------- ----------------
</TABLE>
THIS EXAMPLE IS ONLY AN ILLUSTRATION. ACTUAL EXPENSES AND RETURNS WILL VARY.
2. On page 21 under "Investing with Victory" the second paragraph should be
changed as follows:
"These Funds offer only Class A shares. Class A shares of the LifeChoice Funds
do not have a front-end sales charge."
3. The sections titled "Calculation of Sales Charges" and "Sales Charge
Reductions and Waivers" are deleted until exemptive relief is obtained.
4. On page 25 under "How to Exchange Shares" the third bullet point is replaced
in its entirety with the following:
Shares of a Fund may be exchanged at relative net asset value.
However, if you exchange into a fund with a sales charge, you pay
the percentage point difference between that fund's sales charge and
any sales charge you have previously paid in connection with the
shares you are exchanging. Since the Funds do not have a sales
charge, if you were to purchase another fund in the Victory Group
that has a 5.75% sales charge, you would pay up to a 5.75% sales
charge.
If you would like more information about the Funds you may call 800-539-FUND or
800-539-3863.
VF-LCHF-SUP1
