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Please file this prospectus supplement with your records.
STRONG GROWTH AND INCOME FUNDS
STRONG ASSET ALLOCATION FUND, INC.
STRONG TOTAL RETURN FUND, INC.
STRONG AMERICAN UTILITIES FUND, INC.
Prospectus Supplement Dated February 17, 1995, to Prospectus Dated
December 28, 1994.
ANNUAL MEETING OF SHAREHOLDERS. The Board of Directors of the Funds has
approved submitting for shareholder vote the following items at an Annual
Meeting of Shareholders to be held on April 13, 1995, or any adjournment
thereof: (i) the election of an expanded Board of Directors for each Fund; (ii)
adoption and ratification of each Fund's revised advisory agreement with Strong
Capital Management, Inc. (SCM) and approval and ratification of the subadvisory
agreement between SCM and W.H. Reaves & Co., Inc. with regard to the American
Utilities Fund; (iii) the ratification of independent public accountants for
each Fund; (iv) adoption of each Fund's revised Articles of Incorporation; and
(v) the approval of a revised investment objective for the Total Return and
American Utilities Funds.
The Board of Directors of the Strong Total Return and American Utilities Funds
also has proposed for shareholder approval certain changes to each Fund's
investment limitations that are designed (i) to simplify and modernize the
Funds' fundamental investment limitations, (ii) to replace certain fundamental
investment limitations with non-fundamental operating policies, and (iii) to
eliminate certain limitations. These changes, if adopted, are intended to
conform each Fund's policies to those expected to become standard for all Funds
managed by SCM and, in certain cases, are designed to increase each Fund's
flexibility to make investments. Certain similar changes have already been
approved by the shareholders of the Strong Asset Allocation Fund, formerly known
as the Strong Investment Fund.
The proposed investment objective for the Total Return Fund is "to seek high
total return by investing for capital growth and income." The Total Return
Fund will continue to emphasize equity investments, and, in pursuit of its
objective, it may invest in any combination of equity securities, bonds, and
short-term fixed income securities. The proposed investment objective for the
American Utilities Fund is "to seek total return by investing for both income
and capital growth." The American Utilities Fund will continue to invest
primarily in the equity securities of public utility companies headquartered in
the United States. The amended investment objectives are designed to describe
each Fund's goal more clearly and are not intended to change the manner in
which the Funds are managed.
A copy of each Fund's Proxy Statement dated February 16, 1995, will be provided
without charge by calling 1-800-368-3863 and is incorporated herein by
reference. This information supplements the section entitled "Investment
Objectives and Policies" contained on pages I-11 through I-14 of the
Prospectus.
WHEN-ISSUED SECURITIES. Effective immediately, the Asset Allocation and Total
Return Funds may invest without limitation in when-issued or delayed delivery
securities ("when-issued securities"). For more information concerning
when-issued securities, please refer to the section entitled "When-Issued
Securities" on page I-18 of the Prospectus. This information supplements the
referenced section.
FORWARD CURRENCY CONTRACTS. Effective immediately, the Total Return Fund may
enter into forward currency contracts to set a fixed exchange rate for foreign
security transactions in order to facilitate the settlement of foreign
securities and to hedge out the foreign currency risk attached to a foreign
security between the purchase or sale of the security and its subsequent
settlement. Forward currency contracts involve obligations to purchase or sell
a specified currency at a future date, which may be any fixed number of days
(or within a specified time period) from the date of the contract agreed upon
by the parties, at a price set at the time of the contract. When a Fund enters
into a forward currency contract, it relies on the counter party to make or
take delivery of the underlying currency at the maturity of the contract.
Failure by the counter party to do so would result in the loss of any expected
benefit of the transaction. When required by Securities and Exchange
Commission guidelines, a Fund will set aside permissible liquid assets in a
segregated account to secure its potential obligations under forward currency
contracts. This information supplements the section entitled "Foreign
Securities" contained on pages I-18 through I-20 of the Prospectus.
