AMERICAN CENTURY QUANTITATIVE EQUITY FUNDS
PROSPECTUS SUPPLEMENT
Global Gold o Global Natural Resources o Utilities
Income & Growth o Equity Growth
SUPPLEMENT DATED JUNE 2, 1997
Prospectus dated May 1, 1997
SPECIAL MEETING OF SHAREHOLDERS
The Board of Trustees has requested that the following matters be submitted to
shareholders of the Funds for approval at a Special Meeting of Shareholders to
be held on July 30, 1997, to consider the following proposals:
1. To ratify the selection of Coopers & Lybrand LLP as the independent
auditors for each Fund for its current fiscal year;
2. To vote on the approval of a Management Agreement with American Century
Investment Management, Inc.;
3. To approve the adoption of standardized investment limitations by amending
or eliminating certain of the Funds' current fundamental investment
limitations; and
7. To transact such other business which may come before the meeting, although
we are not aware of any other items to be considered.
Proposals 4, 5 and 6 do not apply to the funds offered by this Prospectus. The
record date for the meeting is June 2, 1997. If you own shares of the Funds as
of the close of business on that date, you will be entitled to vote at the
meeting. Proxy materials containing more information about these proposals are
expected to be first sent to shareholders on June 2, 1997. If approved by
shareholders, the Management Agreement in Proposal 2 and the amendments to the
Funds' fundamental investment limitations would become effective on August 1,
1997.
FURTHER INFORMATION ABOUT PROPOSAL 2
The proposed Management Agreement with American Century Investment Management,
Inc. ("ACIM") is substantially different from the Funds' current Advisory
Agreement with Benham Management Corporation ("BMC"). The most important change
is a difference in the way management fees are calculated under the proposed
agreement. Rather than paying separate investment advisory fees, transfer agency
fees, and operating costs, it is proposed that the Funds pay one "unified" fee,
which would cover not just the investment advisory fee, but nearly all expenses
of the Funds. The expenses covered under the unified fee would include fees for
administrative services, transfer agency services, custodian fees, printing and
mailing costs for shareholder materials and shareholder meeting expenses, all of
which are charged to the Funds under the current arrangements with BMC. While
the fees paid under the proposed Management Agreement are not directly
comparable to those of the Funds' current agreements with their service
providers, the effect of the proposed Management Agreement would have been a net
decrease in total expenses paid by all of the American Century funds as a group
if the proposed Management Agreement had been in effect during the 12 months
ended December 31, 1996. However, if the proposed Management Agreement had been
in effect during such period, the total expense ratios of some funds may have
been higher. In no case is the proposed management fee of any fund higher than
the maximum total expense ratio payable under the current Advisory Agreement.
If the proposed Management Agreement is approved, the investment management of
the Funds will not change in any way. Certain employees of ACIM currently
provide investment management services to the Funds through an arrangement with
BMC by which certain employees of BMC also provide investment management
services to funds managed by ACIM. If the proposed Management Agreement is
approved, ACIM intends to consolidate the investment management capabilities of
the two advisors in ACIM. The same investment teams that currently manage the
Funds will continue under the proposed Management Agreement with ACIM.
The table below depicts the effect of the proposed Management Agreement on the
Funds for the 12 month period ended December 31, 1996:
After Expense Reimbursements
- -------------------------------------------------------------------------------
Management Fee Other Expenses Total Expenses
Current Proposed Current Proposed Current Proposed
- -------------------------------------------------------------------------------
Equity 0.35% 0.70% 0.28% 0.01% 0.63% 0.71%
Growth
- -------------------------------------------------------------------------------
Global 0.27% 0.70% 0.35% 0.01% 0.62% 0.71%
Gold
- -------------------------------------------------------------------------------
Global 0.20% 0.70% 0.55% 0.02% 0.75% 0.72%
Natural
Resources
- -------------------------------------------------------------------------------
Income & 0.36% 0.70% 0.26% 0.01% 0.62% 0.71%
Growth
- -------------------------------------------------------------------------------
Utilities 0.28% 0.70% 0.45% 0.01% 0.73% 0.71%
- -------------------------------------------------------------------------------
Absent the effect of voluntary fee waivers and contractual expense limitations,
the management fee, other expenses and total expenses of the following Funds
under the current Advisory Agreement would have been, respectively: Global
Natural Resources, 0.40%, 0.55% and 0.95%; and Utilities, 0.26%, 0.45% and
0.71%.
FURTHER INFORMATION ABOUT PROPOSAL 3
Currently the Funds have fundamental investment restrictions that vary between
the Funds and those of other funds in the American Century family of mutual
funds. The Funds also have investment restrictions that reflect legal and other
requirements that are no longer applicable to the Funds. In the interests of
efficiency in fund management and compliance, we have analyzed the fundamental
investment limitations and policies of the Funds in an effort to formulate a
standard set of policies for all American Century funds that reflect current
industry practice and will allow the Funds to respond to changes in regulatory
and industry practice without the expense and delay of a shareholder vote. It
should be noted that the adoption of the proposed changes is not expected to
substantially affect the way the Funds are managed.
OTHER PROSPECTUS CHANGES
Investment Management
The members of the American Century quantitative equity portfolio management
team responsible for management of Income & Growth are John Schniedwind and Kurt
Borgwardt. The members of the American Century quantitative equity portfolio
management team responsible for management of Equity Growth are Jeff Tyler and
William Martin.
In the section titled "Investment Management," the second and third full
paragraphs appearing on page 21 of the Prospectus for Income & Growth and Equity
Growth are deleted and replaced with the following:
JOHN SCHNIEDWIND, Senior Vice President and Group Head - Quantitative Equity,
has been a member of the team that manages Income & Growth since its inception
and has supervised the teams that manage Income & Growth, Equity Growth, and
American Century Utilities Fund since their inceptions. Mr. Schniedwind also
supervises the portfolio management teams which manage American Century Global
Gold Fund and American Century Global Natural Resources Fund. Mr. Schniedwind
joined American Century in 1982.
KURT BORGWARDT, Director of Quantitative Research, joined the team managing
Income & Growth in May 1997. Mr. Borgwardt joined American Century in 1990 and
has served as the Director of Quantitative Research since then. Mr. Borgwardt
also serves on the management team for American Century Utilities Fund.
JEFFERY R. TYLER, Senior Vice President and Portfolio Manager, joined the team
managing Equity Growth in May 1997. Mr. Tyler joined American Century in 1988.
Mr. Tyler is responsible for the supervision of the American Century Strategic
Asset Allocation Funds and the American Century Capital Manager Fund and
supervises portfolio management teams for American Century's government bond and
money market funds. Mr. Tyler has also served on the team which manages the
American Century-Benham European Government Bond Fund since its inception.
WILLIAM MARTIN, Senior Vice President and Portfolio Manager, joined the team
managing Equity Growth in May 1997. Mr. Martin also has served on the management
team for American Century Global Gold and American Century Global Natural
Resources Funds since their inceptions.
The members of the American Century quantitative equity portfolio management
team responsible for management of Utilities are John Schniedwind, Kurt
Borgwardt and Joseph B. Sterling. The members of the American Century
quantitative equity portfolio management team responsible for management of
Global Natural Resources are William Martin and Joseph B. Sterling. In the
section titled "Investment Management," the second full paragraph appearing on
page 27 of the Prospectus for Global Gold, Global Natural Resources and
Utilities is deleted and replaced with the following:
JOHN SCHNIEDWIND, Senior Vice President and Group Head - Quantitative Equity,
has been a member of the team that manages Utilities since its inception and has
supervised the teams that manage American Century Income & Growth Fund, American
Century Equity Growth Fund, and Utilities since their inceptions. Mr.
Schniedwind also supervises the portfolio management teams which manage Global
Gold and Global Natural Resources. Mr. Schniedwind joined American Century in
1982.
KURT BORGWARDT, Director of Quantitative Research, joined the team managing
Utilities in May 1997. Mr. Borgwardt joined American Century in 1990 and has
served as the Director of Quantitative Research since then. Mr. Borgwardt also
serves on the management team for American Century Income & Growth Fund.
JOSEPH B. STERLING, Portfolio Manager, joined the team managing Global Natural
Resources in November 1996 and the team managing Utilities in May 1997. Prior to
joining the portfolio management team for Global Natural Resources, Mr. Sterling
served as an Associate Portfolio Manager. Mr. Sterling joined American Century
in 1989 as an Equity Research Analyst and held that position until December
1995, when he was promoted to Associate Portfolio Manager.
P.O. Box 419200 [american century logo]
Kansas City, Missouri American
64141-6200 Century(sm)
1-800-345-2021 or 816-531-5575
SH-SPL-8770 9705
