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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to S240.14a-11(c) or S240.14a-12
INVESCO INTERNATIONAL FUNDS, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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INVESCO Emerging Markets Fund
INVESCO European Fund
[LOGO APPEARS HERE](R) INVESCO Pacific Basin Fund
INVESCO International Blue Chip Fund
(each a series of INVESCO International Funds, Inc.)
May 20, 1999
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Dear Shareholder:
The attached proxy materials seek your approval to liquidate INVESCO
Emerging Markets Fund ("Emerging Markets Fund"), a series of INVESCO
International Funds, Inc. ("International Funds"), to effect certain changes
to the fundamental policies of Emerging Markets Fund, INVESCO European Fund
("European Fund"), and INVESCO Pacific Basin Fund ("Pacific Basin Fund"), each
a series of International Funds, to elect directors of International Funds,
and to ratify the appointment of PricewaterhouseCoopers LLP as independent
accountants of Emerging Markets Fund, European Fund, Pacific Basin Fund, and
INVESCO International Blue Chip Fund ("International Blue Chip Fund").
Your board of directors unanimously recommends a vote FOR all proposals. The
board believes that the proposed changes are in the best interests of Emerging
Markets Fund, European Fund, Pacific Basin Fund, and International Blue Chip
Fund, and their respective shareholders. Shareholders of Emerging Markets Fund
are being asked to approve the liquidation of Emerging Markets Fund (please
see the separate letter addressed to you about the proposed liquidation).
Shareholders are also being asked to approve certain changes to the
fundamental investment restrictions of Emerging Markets Fund, European Fund,
and Pacific Basin Fund that will modernize their fundamental investment
restrictions and make them more uniform with those of the other INVESCO Funds.
The attached proxy materials provide more information about the proposed
liquidation of Emerging Markets Fund, the proposed changes in fundamental
investment restrictions, and the other matters you are being asked to vote
upon.
Your vote is important no matter how many shares you own. Voting your shares
early will permit International Funds to avoid costly follow-up mail and
telephone solicitation. After reviewing the attached materials, please
complete, date, and sign your proxy card and mail it in the enclosed return
envelope promptly. As an alternative to using the paper proxy card to vote,
you may vote by telephone, by facsimile, through the Internet, or in person.
Very truly yours,
/s/ Mark H. Williamson
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Mark H. Williamson
President
INVESCO International Funds, Inc.
9958
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INVESCO EMERGING MARKETS FUND
INVESCO EUROPEAN FUND
INVESCO PACIFIC BASIN FUND
INVESCO INTERNATIONAL BLUE CHIP FUND
(each a series of INVESCO International Funds, Inc.)
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
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To The Shareholders:
Notice is hereby given that a special meeting of shareholders (the
"Meeting") of INVESCO Emerging Markets Fund ("Emerging Markets Fund"), INVESCO
European Fund ("European Fund"), INVESCO Pacific Basin Fund ("Pacific Basin
Fund"), and INVESCO International Blue Chip Fund (each a "Fund" and,
collectively, the "Funds"), each a series of INVESCO International Funds, Inc.
("International Funds"), will be held on May 20, 1999, at 10:00 a.m., Mountain
Time, at the offices of INVESCO Funds Group, Inc., 7800 East Union Avenue,
Denver, Colorado, for the following purposes:
1.For Emerging Markets Fund voting separately, to approve a Plan of
Liquidation and Termination for Emerging Markets Fund;
2.For Emerging Markets Fund, European Fund, Blue Chip and Pacific Basin Fund,
each voting separately, to approve certain changes to the fundamental
investment restrictions of Emerging Markets Fund, European Fund, Blue
Chip and Pacific Basin Fund;
3.For the Funds voting together, to elect directors of International Funds;
4.For each Fund voting separately, to ratify the appointment of
PricewaterhouseCoopers LLP as independent accountants of each Fund; and
5.To transact such other business as may properly come before the Meeting or
any adjournment thereof.
You are entitled to vote at the Meeting and any adjournment thereof if you
owned shares of a Fund at the close of business on March 12, 1999. If you
attend the Meeting, you may vote your shares in person. If you do not expect
to attend the Meeting, please complete, date, sign and return the enclosed
proxy card in the enclosed postage-paid envelope.
By Order of the Board of Directors,
/s/ Glen A. Payne
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Glen A. Payne
Secretary
March 23, 1999
Denver, Colorado
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YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card,
date and sign the card, and return it in the envelope provided. IF YOU
DATE, SIGN, AND RETURN THE PROXY CARD BUT GIVE NO VOTING INSTRUCTIONS,
YOUR SHARES WILL BE VOTED "FOR" THE PROPOSALS NOTICED ABOVE. In order to
avoid the additional expense of further solicitation, we ask your
cooperation in mailing in your proxy card promptly. As an alternative to
using the paper proxy card to vote, you may vote by telephone, through the
Internet, by facsimile machine, or in person. To vote by telephone, please
call 1-800-690-6903. Shares that are registered in your name, as well as
shares that are held in "street name" through a broker, may be voted via
the Internet or by telephone. To vote in this manner, you will need the
12-digit "control" number that appears on your proxy card. To vote via the
Internet, please access http://www.proxyvote.com on the World Wide Web. In
addition, shares that are registered in your name may be voted by faxing
your completed proxy card to 1-800-733-1885. If we do not receive your
completed proxy after several weeks, you may be contacted by our proxy
solicitor, Shareholder Communications Corporation. Our proxy solicitor
will remind you to vote your shares or will record your vote over the
phone if you choose to vote in that manner.
Unless proxy cards submitted by corporations and partnerships are signed
by the appropriate persons as indicated in the voting instructions on the
proxy card, they will not be voted.
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INVESCO INTERNATIONAL FUNDS, INC.
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INVESCO Emerging Markets Fund
INVESCO European Fund
INVESCO Pacific Basic Fund
INVESCO International Blue Chip Fund
7800 East Union Avenue
Denver, Colorado 80237
(Toll Free) 1-800-646-8372
PROXY STATEMENT
Special Meeting of Shareholders
May 20, 1999
VOTING INFORMATION
This Proxy Statement is being furnished to shareholders of INVESCO Emerging
Markets Fund ("Emerging Markets Fund"), INVESCO European Fund ("European
Fund"), INVESCO Pacific Basin Fund ("Pacific Basin Fund"), and INVESCO
International Blue Chip Fund ("International Blue Chip Fund") (each a "Fund"
and, collectively, the "Funds"), each a series of INVESCO International Funds,
Inc. ("International Funds"), in connection with the solicitation of proxies
from shareholders of the Funds by the board of directors (the "Board") of
International Funds, for use at a special meeting of shareholders to be held
on May 20, 1999 (the "Meeting"), and at any adjournment of the Meeting. This
Proxy Statement will first be mailed to shareholders on or about March 23,
1999.
For each Fund, one-third of the Fund's shares outstanding on March 12, 1999
(the "Record Date") represented in person or by proxy, shall constitute a
quorum and must be present for the transaction of business at the Meeting. If
a quorum is not present at the Meeting or a quorum is present but sufficient
votes to approve one or more of the proposals set forth in this Proxy
Statement are not received, the persons named as proxies may propose one or
more adjournments of the Meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the Meeting in person or by proxy. The persons named as
proxies will vote those proxies that they are entitled to vote FOR any
proposal in favor of such an adjournment and will vote those proxies required
to be voted AGAINST that proposal against such adjournment. A shareholder vote
may be taken on one or more of the proposals in this Proxy Statement prior to
any such adjournment if a quorum is present with respect to each proposal,
sufficient votes have been received and it is otherwise appropriate.
Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners
or other persons entitled to vote and for which the broker does not have
discretionary voting authority. Abstentions and broker non-votes will be
counted as shares present for purposes of determining whether a quorum is
present but will not be voted for or against any adjournment or proposal.
Accordingly, abstentions and broker non-votes effectively will be a vote
against adjournment or against any proposal where the required vote is a
percentage of the shares present or outstanding. Abstentions and broker non-
votes will not be counted, however, as votes cast for purposes of determining
whether sufficient votes have been received to approve a proposal.
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The individuals named as proxies on the enclosed proxy card will vote in
accordance with your directions as indicated on the proxy card, if it is
received properly executed by you or by your duly appointed agent or attorney-
in-fact. If you date, sign, and return the proxy card, but give no voting
instructions, your shares will be voted in favor of approval of each of the
proposals and the duly appointed proxies may, in their discretion, vote upon
such other matters as may come before the Meeting. The proxy card may be
revoked by giving another proxy or by letter or telegram revoking the initial
proxy. To be effective, revocation must be received by International Funds
prior to the Meeting and must indicate your name and account number. If you
attend the Meeting in person you may, if you wish, vote by ballot at the
Meeting, thereby canceling any proxy previously given.
In order to reduce costs, the notices to a shareholder having more than one
account in a Fund listed under the same social security number at a single
address have been combined. The proxy cards have been coded so that a
shareholder's votes will be counted for each such account.
As of the Record Date, each Fund had the following shares of common stock
outstanding: 151,925.813 (Emerging Markets Fund); 44,445,971.869 (European
Fund); 7,898,178.016 (Pacific Basin Fund); and 1,859,115.053 (International
Blue Chip Fund). The solicitation of proxies, the cost of which will be borne
half by INVESCO Funds Group, Inc. ("INVESCO"), the investment adviser and
transfer agent of the Funds, and half by the Funds, will be made primarily by
mail but also may be made by telephone or oral communications by
representatives of INVESCO and INVESCO Distributors, Inc. ("IDI"), the
distributor of the INVESCO group of investment companies ("INVESCO Funds"),
none of which will receive any compensation for these activities from the
Funds, or by Shareholder Communications Corporation, professional proxy
solicitors, which will be paid fees and expenses of up to approximately
$102,000 for soliciting services. If votes are recorded by telephone,
Shareholder Communications Corporation will use procedures designed to
authenticate shareholders' identities, to allow shareholders to authorize the
voting of their shares in accordance with their instructions, and to confirm
that a shareholder's instructions have been properly recorded. You may also
vote by mail, by facsimile or through a secure Internet site. Proxies voted by
telephone, facsimile or Internet may be revoked at any time before they are
voted at the meeting in the same manner that proxies voted by mail may be
revoked.
Copies of each of the Fund's most recent annual and semi-annual reports,
including financial statements, have previously been delivered to
shareholders. Shareholders may request copies of these reports, without
charge, by writing to INVESCO Distributors, Inc., P.O. Box 173706, Denver,
Colorado 80217-3706, or by calling toll-free 1-800-646-8372.
Except as set forth in Appendix A, INVESCO does not know of any person who
owns 5% or more of the shares of any Fund. Directors and officers of
International Funds own in the aggregate less than 1% of the shares of each
Fund.
Vote Required. Approval of Proposal 1, to liquidate Emerging Markets Fund,
requires the affirmative vote of the lesser of: (1) 67% of Emerging Markets
Fund shares present at a meeting of its shareholders if the holders of more
than 50% of Emerging Markets Fund's outstanding shares are present in person
or by proxy; or (2) more than 50% of Emerging Markets Fund's outstanding
shares. Approval of Proposal 2 with respect to a Fund requires the affirmative
vote of a "majority of the outstanding voting securities" of that Fund, as
defined in the Investment Company Act of 1940 ("1940 Act"). This means that
for a Fund, Proposal 2 must be approved by the lesser of: (1) 67% of that
Fund's shares present at a meeting of shareholders if the owners of more than
50% of that Fund's shares then outstanding are present in person or by proxy;
or (2) more than 50% of that Fund's outstanding shares. A plurality of the
votes of International Funds cast at the Meeting is sufficient to approve
Proposal 3. Approval of Proposal 4 with respect to a Fund requires the
affirmative vote of a majority of that Fund's votes present at the
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Meeting, provided a quorum is present with respect to that Fund. Each
outstanding full share of each Fund is entitled to one vote, and each
outstanding fractional share thereof is entitled to a proportionate fractional
share of one vote. If any Proposal is not approved by the requisite vote of
shareholders of a Fund or the Funds, the persons named as proxies may propose
one or more adjournments of the Meeting to permit further solicitation of
proxies.
PROPOSAL 1:TO APPROVE A PLAN OF LIQUIDATION AND TERMINATION
("LIQUIDATION PLAN") FOR EMERGING MARKETS FUND ("FUND") (FOR
EMERGING MARKETS FUND SHAREHOLDERS ONLY)
The Proposed Liquidation and Termination
The Board believes that liquidating Emerging Markets Fund's assets and
terminating its existence would be in its shareholders' best interests.
Accordingly, the Board, including all of its directors who are not "interested
persons," as that term is defined in the 1940 Act, of International Funds
("Independent Directors"), adopted the proposed Liquidation Plan, which
provides for liquidating Emerging Markets Fund's assets, distributing the
proceeds thereof to its shareholders pro rata, and terminating Emerging
Markets Fund's existence. A copy of the Liquidation Plan is attached to this
proxy statement as Appendix B.
Emerging Markets Fund commenced operations on February 12, 1998. Throughout
the period since then, various Fund expenses have been voluntarily absorbed by
its investment adviser, INVESCO. Notwithstanding the expense reduction
measures taken by INVESCO, Emerging Markets Fund has experienced limited asset
growth. In addition, Emerging Markets Fund has experienced uneven returns over
the last year and net asset reductions over the past fiscal year. INVESCO and
Emerging Markets Fund's distributor, IDI, have come to believe that it is
unlikely that Emerging Markets Fund will experience material growth in assets
in the foreseeable future. In light of the inefficiencies and higher costs of
managing Emerging Markets Fund's small asset base, INVESCO and IDI submitted
to the Board a proposal to liquidate and terminate Emerging Markets Fund.
At a meeting held on February 3, 1999, the Board considered and unanimously
approved the Liquidation Plan, subject to shareholder approval. Under
International Funds' Articles of Incorporation, the liquidation of Emerging
Markets Fund may be effected only on the affirmative vote of the lesser of (1)
67% of Emerging Markets Fund's shares present at a meeting of its shareholders
if the holders of more than 50% of its outstanding shares are present in
person or by proxy or (2) more than 50% of Emerging Markets Fund's outstanding
shares.
Consideration by the Board
In evaluating the proposed liquidation and termination of Emerging Markets
Fund, the Board considered a number of factors, including the amount of
Emerging Markets Fund's total assets, its expense ratio (absent the absorption
of expenses mentioned above), and the likelihood that additional sales of Fund
shares could enable it to attain an asset level that would sustain an
acceptable expense ratio. The Board also considered INVESCO's representation
that it is not prepared to continue to waive its advisory fee and absorb the
expenses associated with managing Emerging Markets Fund at its current low
level of assets indefinitely, but will do so pending Emerging Markets Fund's
liquidation and termination. Based on consideration of the foregoing, and
other factors they deemed relevant, the Board (including all of its
Independent Directors) approved the liquidation and termination of Emerging
Markets Fund, subject to shareholder approval.
If the Liquidation Plan is not approved by the shareholders, Emerging
Markets Fund will continue to operate as a series of International Funds (but
without INVESCO's advisory fee waiver and absorption of expenses). The Board
thus is asking Emerging Markets Fund's shareholders to approve certain changes
to Emerging Markets Fund's
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fundamental investment restrictions, to elect directors of International
Funds, and to ratify the selection of PricewaterhouseCoopers LLP as
independent accountants of Emerging Markets Fund, as set forth in Proposals 2,
3, and 4, respectively.
Description of the Liquidation Plan
Under the Liquidation Plan each shareholder's interest in Emerging Markets
Fund's assets will be fixed on the date on which the shareholders approve the
Liquidation Plan. On that date, the books of Emerging Markets Fund will be
closed. Thereafter, all assets of Emerging Markets Fund not already held in
cash or cash equivalents will be liquidated. The Liquidation Plan provides
that, as soon as reasonably practicable after that date, the distribution of
Emerging Markets Fund's assets will be made in one or two liquidating
distributions. The first such distribution is expected to consist of cash
representing substantially all of Emerging Markets Fund's assets less the
amount reserved to pay its liabilities and expenses. A second liquidating
distribution, if necessary, is anticipated to be made within 90 days after the
first liquidating distribution and will consist of cash from any assets
remaining after payment of those liabilities and expenses, the proceeds of any
sale of Emerging Markets Fund assets not sold prior to the first liquidating
distribution, and any other miscellaneous Emerging Markets Fund income.
The date or dates on which Emerging Markets Fund will pay the liquidating
distributions and on which Emerging Markets Fund will be liquidated have not
been determined, but it is anticipated that, if Emerging Markets Fund's
shareholders adopt the Liquidation Plan, the liquidating distributions would
occur as soon as reasonably practical after the date on which the shareholders
approve the Liquidation Plan. Shareholders will receive their respective
portions of the liquidating distribution(s) without any further action on
their part.
The Liquidation Plan will not affect a shareholder's right to redeem his,
her, or its Emerging Markets Fund shares. Therefore, a shareholder may redeem
in accordance with the redemption procedure set forth in Emerging Markets
Fund's current prospectus without waiting for Emerging Markets Fund to take
any action respecting its liquidation. The Liquidation Plan also authorizes
the Board to make variations from or amendments to the provisions thereof that
it deems necessary or appropriate to carry out its purposes. No shareholder
will be entitled to exercise any dissenter's rights or appraisal rights with
respect to Emerging Markets Fund's liquidation and termination under either
the Liquidation Plan or relevant provisions of Maryland law.
Under the Liquidation Plan, Emerging Markets Fund will be responsible for
one-half of the expenses incurred in connection with carrying out the
Liquidation Plan, including the cost of soliciting proxies, liquidating its
assets, and terminating its existence, and INVESCO will be responsible for the
balance of those expenses.
Federal Income Tax Consequences
The following summary provides general information regarding the federal
income tax consequences to Emerging Markets Fund resulting from its
liquidation and termination and to its shareholders on their receipt of
liquidating distributions from Emerging Markets Fund. Emerging Markets Fund
has not sought a ruling from the Internal Revenue Service with respect to
these matters. This summary generally applies to shareholders who are
individual U.S. citizens (other than dealers in securities) and does not
address the particular federal income tax consequences that may apply to
shareholders that are, for example, corporations, trusts, estates, tax-exempt
organizations, or non-resident aliens; nor does this summary address state or
local tax consequences. The tax consequences discussed herein may affect
shareholders differently, depending on their particular tax situations
unrelated to the receipt of liquidating distributions, and accordingly this
summary is not a substitute for careful tax planning. Shareholders may wish to
consult their personal tax advisers concerning their particular tax situations
and the impact thereon of receiving liquidating distributions from Emerging
Markets Fund.
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As discussed above, if the Liquidation Plan is approved by its shareholders,
Emerging Markets Fund will sell its assets and distribute the proceeds to
them. Emerging Markets Fund anticipates that it will retain its qualification
for treatment as a regulated investment company under the Internal Revenue
Code of 1986, as amended, during the liquidation period and thus will not be
taxed on any of its net gain realized from the sale of its assets.
A shareholder who receives a liquidating distribution in cancellation and
redemption of his, her, or its Fund shares will be treated as having sold
those shares for the amount of the liquidating distribution. The shareholder
will recognize gain or loss on that sale measured by the difference between
his, her, or its adjusted tax basis for the shares and the liquidating
distribution. If the shares are held as capital assets, the gain or loss will
be characterized as capital gain or loss. Capital gain or loss attributable to
shares held for more than one year will constitute long-term capital gain or
loss, while capital gain or loss attributable to shares held for one year or
less will be short-term. Shareholders also should be aware that Emerging
Markets Fund is required to withhold 31% of liquidating distributions payable
to any individual and certain other non-corporate shareholders who do not
provide Emerging Markets Fund with a correct taxpayer identification number.
The receipt of a liquidating distribution by an individual retirement
account ("IRA") that holds Fund shares generally will not be treated as a
taxable event to the IRA beneficiary. However, some IRAs that hold Fund shares
may have been established with custodians that may not reinvest the
liquidation distribution proceeds, but instead must immediately distribute
those proceeds to the IRA beneficiary. Those distributions could have adverse
tax consequences for the beneficiaries of such IRAs, who are urged to consult
with their own tax advisers regarding the tax consequences of those
distributions.
Required Vote. Approval of the Liquidation Plan requires the affirmative
vote of the lesser of: (1) 67% of Emerging Markets Fund shares present at a
meeting of its shareholders if the holders of more than 50% of its outstanding
shares are present in person or by proxy; or (2) more than 50% of Emerging
Markets Fund's outstanding shares.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" PROPOSAL 1.
PROPOSAL 2:TO APPROVE AMENDMENTS TO THE
FUNDAMENTAL INVESTMENT RESTRICTIONS OF EMERGING
MARKETS FUND (IF THE LIQUIDATION IS NOT APPROVED),
BLUE CHIP, EUROPEAN FUND, AND PACIFIC BASIN FUND
As required by the 1940 Act, Emerging Markets Fund, European Fund and
Pacific Basin Fund (each a "Fund" and, collectively, the "Funds") have each
adopted certain fundamental investment restrictions ("fundamental
restrictions"), which are set forth in the Funds' Statement of Additional
Information (the "SAI"). These fundamental restrictions may be changed only
with shareholder approval. Restrictions that a Fund has not specifically
designated as fundamental are considered to be "non-fundamental" and may be
changed by the Board without shareholder approval.
Some of the Funds' fundamental restrictions reflect past regulatory,
business or industry conditions, practices or requirements that are no longer
in effect. Also, as other INVESCO Funds have been created over the years,
these funds have adopted substantially similar fundamental restrictions that
often have been phrased in slightly different
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ways, resulting in minor but unintended differences in effect or potentially
giving rise to unintended differences in interpretation. Accordingly, the
Board has approved revisions to the Funds' fundamental restrictions in order
to simplify and modernize them, and make the fundamental restrictions more
uniform with those of the other INVESCO Funds.
The Board believes that eliminating the disparities among the INVESCO Funds'
fundamental restrictions will enhance management's ability to manage the
Funds' assets efficiently and effectively in changing regulatory and
investment environments and permit directors to review and monitor policies
more easily. In addition, standardizing the fundamental restrictions of the
INVESCO Funds will assist the INVESCO Funds in making required regulatory
filings in a more efficient and cost-effective way. Although the proposed
changes in fundamental restrictions will allow each Fund greater investment
flexibility to respond to future investment opportunities, the Board does not
anticipate that the changes, individually or in the aggregate, will result at
this time in a material change in the level of investment risk associated with
an investment in that Fund.
The text and a summary description of each proposed change to each Fund's
fundamental restrictions are set forth below, together with the text of each
current corresponding fundamental restriction. The text below also describes
any non-fundamental restrictions that would be adopted by the Board in
conjunction with the revision of certain fundamental restrictions. Any non-
fundamental restriction may be modified or eliminated by the Board at any
future date without further shareholder approval.
If approved by the shareholders of a Fund at the Meeting, the proposed
changes to a Fund's fundamental restrictions will be adopted by that Fund. The
Fund's Statement of Additional Information will be revised to reflect those
changes as soon as practicable following the meeting.
a. Modification of fundamental restriction on the issuance of senior
securities
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on issuance of senior securities as follows:
The Company may not issue senior securities as defined in the 1940 Act
(except insofar as the Company may be deemed to have issued a senior
security by reason of entering into a repurchase agreement, or borrowing
money, in accordance with the restrictions described below, and in
accordance with the position of the staff of the Securities and Exchange
Commission set forth in Investment Company Act Release No. 10666).
Emerging Markets Fund currently has the following fundamental restriction
on the issuance of senior securities:
The Fund may not borrow money or issue senior securities (as defined in the
1940 Act), except that the Fund may borrow money for temporary or emergency
purposes (not for leveraging or investment) and may enter into reverse
repurchase agreements in an aggregate amount not exceeding 33 1/3% of the
value of its total assets (including the amount borrowed) less liabilities
(other than borrowings). Any borrowings that come to exceed 33 1/3% of the
value of the Fund's total assets by reason of a decline in total assets
will be reduced within three business days to the extent necessary to
comply with the 33 1/3% limitation. This restriction shall not prohibit
deposits of assets to margin or guarantee positions in futures, options,
swaps, or forward contracts, or the segregation of assets in connection
with such contracts.
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The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not issue senior securities, except as permitted under the
Investment Company Act of 1940.
The primary purposes of the Proposal are to eliminate differences in the
wording of the INVESCO Funds' current fundamental restrictions on the issuance
of senior securities for greater uniformity, to eliminate any unnecessary
limitations, and to conform them to 1940 Act requirements regarding the
issuance of senior securities. With respect to Emerging Markets Fund, the
proposed revision would also separate the Fund's fundamental restriction on
borrowing and issuing senior securities into two fundamental restrictions, a
revision that is expected to be standard for all of the INVESCO Funds. (See
modification of fundamental restriction on borrowing, below).
The Board believes that the adoption of the proposed fundamental
restriction, which does not specify the manner in which senior securities may
be issued and is no more limiting than is required under the 1940 Act, will
maximize each Fund's borrowing flexibility for future contingencies and will
conform to the fundamental restrictions of the other INVESCO Funds on the
issuance of senior securities.
b.Modification of fundamental restriction on borrowing and adoption of non-
fundamental restriction on borrowing
Each of Blue Chip, European Fund and Pacific Basin Fund currently has a
fundamental restriction on borrowing as follows:
The Fund may not mortgage, pledge or hypothecate portfolio securities or
borrow money, except borrowings from banks for temporary or emergency
purposes (but not for investment) are permitted in an amount not
exceeding 10% of total assets. A Fund will not purchase additional
securities while any borrowings on behalf of that Fund exist.
Emerging Markets Fund currently has the following fundamental restriction on
borrowing:
The Fund may not borrow money or issue senior securities (as defined in
the 1940 Act), except that the Fund may borrow money for temporary or
emergency purposes (not for leveraging or investment) and may enter into
reverse repurchase agreements in an aggregate amount not exceeding 33
1/3% of the value of its total assets (including the amount borrowed)
less liabilities (other than borrowings). Any borrowings that come to
exceed 33 1/3% of the value of the Fund's total assets by reason of a
decline in total assets will be reduced within three business days to
the extent necessary to comply with the 33 1/3% limitation. This
restriction shall not prohibit deposits of assets to margin or guarantee
positions in futures, options, swaps, or forward contracts, or the
segregation of assets in connection with such contracts.
The Board recommends that shareholders vote to replace these restrictions
with the following fundamental restriction:
The Fund may not borrow money, except that the Fund may borrow money in
an amount not exceeding 33 1/3% of its total assets (including the
amount borrowed) less liabilities (other than borrowings).
Currently, the Funds' fundamental restrictions are significantly more
limiting than the restrictions imposed by the 1940 Act in limiting the
purposes for which the Funds may borrow money. The proposal eliminates the
fundamental nature of the restrictions on the purposes for which a Fund may
borrow money. European Fund and Pacific Basin Fund's fundamental restriction
is also unduly restrictive in limiting all borrowings to 10% of each Fund's
assets. With respect to these Funds, the proposal increases each Fund's
fundamental borrowing authority from
7
<PAGE>
10% to 33 1/3% of its total assets, and eliminates the restriction against
mortgaging, pledging or hypothecating securities. The proposed revision also
eliminates European Fund and Pacific Basin Fund's fundamental restriction
limiting borrowings to banks and prohibiting the purchase of securities when
borrowings are outstanding. For Emerging Markets Fund, the proposal would
delete the explicit requirement, which tracks that already contained in the
1940 Act, that any borrowings that come to exceed 33 1/3% of the Fund's total
assets by reason of a decline in total assets be reduced within three business
days. The proposed revision would also separate Emerging Markets Fund's
fundamental restriction on borrowing and issuing senior securities into two
fundamental restrictions, a revision that is expected to be standard for all
of the INVESCO Funds. (See modification of fundamental investment restriction
on issuing senior securities, above).
If the proposal is approved, the Board will adopt a non-fundamental
restriction as follows:
The Fund may borrow money only from a bank or from an open-end management
investment company managed by INVESCO Funds Group, Inc. or an affiliate
or a successor thereof for temporary or emergency purposes (not for
leveraging or investing) or by engaging in reverse repurchase agreements
with any party (reverse repurchase agreements will be treated as
borrowings for purposes of fundamental limitation ( )).
The non-fundamental restriction reflects European Fund and Pacific Basin
Fund's current fundamental restriction that borrowing by the Funds may only be
done for temporary or emergency purposes. In addition to borrowings from
banks, as permitted by European Fund and Pacific Basin Fund's current
fundamental restriction, the non-fundamental restriction permits the Funds to
borrow from open-end funds managed by INVESCO or an affiliate or successor
thereof. The Funds would not be able to do so, however, unless they obtain
permission for such borrowings from the SEC. The non-fundamental restriction
also clarifies that reverse repurchase agreements will be treated as
borrowings. The Board believes that this approach, making the Funds'
fundamental restriction on borrowing no more limiting than is required under
the 1940 Act, while incorporating more strict limits on borrowing in the
Funds' non-fundamental restriction, will maximize each Fund's flexibility for
future contingencies.
c.Modification of fundamental policy on investing in commodities
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on the purchase of commodities as follows:
The Fund may not buy or sell commodities, commodity contracts, oil, gas
or other mineral interests or exploration programs (however, the Fund
may purchase securities of companies which invest in the foregoing and
may enter into forward contracts for the purchase or sale of foreign
currencies).
Emerging Markets Fund currently has the following fundamental restriction on
the purchase of commodities:
The Fund may not purchase or sell physical commodities other than foreign
currencies unless acquired as a result of ownership of securities (but
this shall not prevent the Fund from purchasing or selling options,
futures, swaps and forward contracts or from investing in securities or
other instruments backed by physical commodities).
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not purchase or sell physical commodities; however, this
policy shall not prevent the Fund from purchasing and selling foreign
currency, futures contracts, options, forward contracts, swaps, caps,
floors, collars and other financial instruments.
8
<PAGE>
The proposed changes to these fundamental restrictions are intended to
conform the restrictions to those of the other INVESCO Funds and to ensure
that each Fund will have maximum flexibility to enter into hedging or other
transactions utilizing financial contracts and derivative products when doing
so is permitted by operating policies established for the Funds by the Board.
Due to the rapid and continuing development of derivative products and the
possibility of changes in the definition of "commodities," particularly in the
context of the jurisdiction of the Commodities Futures Trading Commission, it
is important for each Fund's restriction to be flexible enough to allow it to
enter into hedging and other transactions using these products when doing so
is deemed appropriate by INVESCO and is within the investment parameters
established by the Board. To maximize that flexibility, the Board recommends
that each Fund's fundamental restriction on commodities investments be clear
in permitting the use of derivative products, even if the current non-
fundamental investment restrictions of that Fund would not permit investment
in one or more of the permitted transactions.
The proposal also eliminates European Fund and Pacific Basin Fund's
fundamental restriction on investments in oil, gas or other mineral interests
or exploration programs. Investment in oil, gas or other mineral leases or
programs is not prohibited by federal law for mutual funds, but was prohibited
in the past by some state regulations that are no longer applicable. Although
European Fund and Pacific Basin Fund have no current intention to invest in
oil, gas or other mineral leases, the Board recommends that shareholders
eliminate the fundamental restriction for greater flexibility and uniformity
with other INVESCO Funds.
d.Elimination of fundamental restriction of investing in illiquid securities
and adoption of non-fundamental restriction on investing in illiquid
securities (European Fund and Pacific Basin Fund only)
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction regarding investing in illiquid securities as follows:
The Fund may not purchase the securities of any company if as a result of
such purchase more than 10% of total assets would be invested in
securities which are subject to legal or contractual restrictions on
resale ("restricted securities") and in securities for which there are
no readily available market quotations; or enter into a repurchase
agreement maturing in more than seven days if as a result, such
repurchase agreements, together with restricted securities and
securities for which there are not readily available market quotations,
would constitute more than 10% of total assets.
The Board recommends that shareholders vote to eliminate this restriction.
If the proposal is approved, the Board will adopt the following non-
fundamental restriction for European Fund and Pacific Basin Funds:
The Fund does not currently intend to purchase any security if, as a
result, more than 15% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the
prices at which they are valued.
The primary purpose of the proposal is to conform to the federal securities
law requirements regarding investment in illiquid securities and to conform
the fundamental restrictions of European Fund and Pacific Basin Fund to those
of the other INVESCO Funds. The Funds are currently limited in their ability
to invest in illiquid securities. The Board believes that the proposed
elimination of the fundamental restriction and subsequent adoption of the non-
fundamental restriction will make the restriction more accurately reflect
market conditions and will maximize the Funds' flexibility for future
contingencies. The Board may delegate to INVESCO, the Funds' investment
adviser, the authority to determine whether a security is liquid for the
purposes of this fundamental restriction.
9
<PAGE>
e.Elimination of fundamental restriction on short sales and margin
transactions and adoption of non-fundamental restriction on short sales and
margin transactions (European Fund and Pacific Basin Fund only)
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction regarding short sales and margin transactions as follows:
The Fund may not sell short or buy on margin.
The Board recommends that shareholders vote to eliminate this fundamental
restriction. If the proposal is approved by shareholders, the Board will adopt
the following non-fundamental restriction for European Fund and Pacific Basin
Fund:
The Fund may not sell securities short (unless it owns or has the right
to obtain securities equivalent in kind and amount to the securities
sold short) or purchase securities on margin, except that: (i) this
policy does not prevent the Fund from entering into short positions in
foreign currency, futures contracts, options, forward contracts, swaps,
caps, floors, collars and other financial instruments; (ii) the Fund may
obtain such short-term credits as are necessary for the clearance of
transactions; and (iii) the Fund may make margin payments in connection
with futures contracts, options, forward contracts, swaps, caps, floors,
collars and other financial instruments.
The proposed change clarifies the wording of the restriction and expands the
exceptions to the restriction, which generally prohibits European Fund and
Pacific Basin Fund from selling securities short or buying securities on
margin. The proposed non-fundamental restriction also permits short sales
against the box, in which an investor sells securities short while owning the
same securities in the same amount or having the right to obtain equivalent
securities. It also permits European Fund and Pacific Basin Fund to borrow a
security on a short-term basis and to enter into short positions and make
margin payments in connection with a variety of financial instruments. The
Board believes that elimination of the fundamental restriction and adoption of
the non-fundamental restriction will provide European Fund and Pacific Basin
Fund with greater investment flexibility.
f.Modification of fundamental restriction on real estate investments
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on real estate investments as follows:
The Fund may not buy or sell real estate or interests therein (however,
securities issued by companies which invest in real estate or interests
therein may be purchased and sold).
Emerging Markets Fund currently has the following fundamental restriction on
real estate investments:
The Fund may not invest directly in real estate or interests in real
estate; however, the Fund may own debt or equity securities issued by
companies engaged in those businesses.
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not purchase or sell real estate unless acquired as a result
of ownership of securities or other instruments (but this shall not
prevent the Fund from investing in securities or other instruments
backed by real estate or securities of companies engaged in the real
estate business).
In addition to conforming each Fund's fundamental restriction on real
estate, the proposal would more
10
<PAGE>
completely describe the types of real estate-related securities investments
that are permissible for the Funds and would permit the Funds to purchase or
sell real estate acquired as a result of ownership of securities or other
instruments (e.g., through foreclosure on a mortgage in which the Funds
directly or indirectly hold an interest). The Board believes that this
clarification will make it easier for decisions to be made concerning the
Funds' investments in real estate-related securities without materially
altering the general restriction on direct investments in real estate or
interests in real estate. The proposed change would also give the Funds the
ability to invest in assets secured by real estate.
g.Modification of fundamental restriction on investing in another investment
company
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction regarding investments in other investment companies as follows:
The Fund may not invest in the securities of any other investment company
except for a purchase or acquisition in accordance with a plan of
reorganization, merger or consolidation and except that not more than
10% of the INVESCO Pacific Basin Fund's or the INVESCO European Fund's
total assets may be invested in shares of closed-end investment
companies within the limits of Section 12(d)(1) of the 1940 Act.
Emerging Markets Fund currently has the following fundamental restriction
regarding investments in other investment companies:
The Emerging Markets Fund may, notwithstanding any other investment
policy or limitation (whether or not fundamental), invest all of its
assets in the securities of a single open-end management investment
company with substantially the same fundamental investment objectives,
policies and limitations as the Fund.
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may, notwithstanding any other fundamental investment policy or
limitation, invest all of its assets in the securities of a single open-
end management investment company managed by INVESCO Funds Group, Inc.
or an affiliate or a successor thereof, with substantially the same
fundamental investment objectives, policies and limitations as the Fund.
The proposed revision to each Fund's fundamental restriction would ensure
that the INVESCO Funds have uniform policies permitting each Fund to adopt a
"master/feeder" structure whereby one or more Funds invest all of their assets
in another fund. The master/feeder structure has the potential, under certain
circumstances, to minimize administration costs and maximize the possibility
of gaining a broader investor base. Currently, none of the INVESCO Funds
intend to establish a master/feeder structure; however, the Board recommends
that shareholders approve the proposal, ensuring that this structure will be
available in the event that the Board determines to recommend the adoption of
a master/feeder structure by the Funds. The proposed revision, unlike the
current fundamental restriction, would require that any fund in which the
Funds may invest under a master/feeder structure be advised by INVESCO or an
affiliate thereof. If a Fund did purchase the securities of another investment
company, shareholders might incur additional expenses because the Fund would
have to pay its ratable share of the expenses of the other investment company.
11
<PAGE>
h. Elimination of fundamental restriction on investments in companies for the
purpose of exercising control or management (European Fund and Pacific
Basin Fund only)
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction regarding investments in companies for the purpose of exercising
control or management as follows:
The Fund may not invest in any company for the purpose of exercising control
or management.
The Board recommends that shareholders vote to eliminate this fundamental
restriction. There is no legal requirement that a fund have an affirmative
policy on investment for the purpose of management or control if it does not
intend to make investments for that purpose. European Fund and Pacific Basin
Fund each have no intention of investing in any company for the purpose of
exercising control or management. By eliminating this restriction, the Board
may, however, be able to authorize a strategy in the future if it concludes
that doing so would be in the best interests of the Funds and their
shareholders.
i.Modification of fundamental restriction on underwriting securities
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on underwriting securities as follows:
The Fund may not engage in the underwriting of any securities, except
insofar as the Fund may be deemed an "underwriter" under the 1933 Act in
disposing of a portfolio security.
Emerging Markets Fund currently has the following fundamental restriction on
underwriting securities:
The Fund may not act as an underwriter of securities issued by others,
except to the extent that it may be deemed an underwriter in connection
with the disposition of portfolio securities of the Fund.
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not underwrite securities of other issuers, except insofar
as it may be deemed to be an underwriter under the Securities Act of
1933, as amended, in connection with the disposition of the Fund's
portfolio securities.
The purpose of the proposal is to eliminate minor differences in the wording
of the Funds' current fundamental restriction on underwriting for greater
uniformity with the fundamental restrictions of the other INVESCO Funds and to
avoid unintended limitations.
j.Modification of fundamental restriction on loans
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on loans as follows:
The Fund may not make loans to any person, except through the purchase of
debt securities in accordance with the investment policies of the Funds,
or the lending of portfolio securities to broker-dealers or other
institutional investors, or the entering into of repurchase agreements
with member banks of the Federal Reserve System, registered broker-
dealers and registered government securities dealers. The aggregate
value of all portfolio securities loaned may not exceed 33 1/3% of a
Fund's total assets (taken at current value). No more than 10% of a
Fund's total assets may be invested in repurchase agreements maturing in
more than seven days.
12
<PAGE>
Emerging Markets Fund currently has the following fundamental restriction on
loans:
The Fund may not lend any security or make any other loan if, as a
result, more than 10% of its total assets would be lent to other parties
(but this limitation does not apply to purchases of commercial paper,
debt securities or to repurchase agreements.)
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not lend any security or make any loan if, as a result, more
than 33 1/3% of its total assets would be lent to other parties, but
this limitation does not apply to the purchase of debt securities or to
repurchase agreements.
The primary purposes of the proposal are to eliminate minor differences in
the wording of the INVESCO Funds' current fundamental restrictions on loans to
achieve greater uniformity and to conform the fundamental restrictions to the
requirements of the 1940 Act. For European Fund and Pacific Basin Fund, the
revision would eliminate the restriction on investing in repurchase agreements
maturing in more than seven days. European Fund and Pacific Basin Fund's
investments in such repurchase agreements will be subject to the non-
fundamental restriction on illiquid securities (see proposal 1.d, above). The
proposed changes to European Fund and Pacific Basin Fund's fundamental
restriction are relatively minor and would have no substantive effect on
either Fund's lending activities or other investments.
Emerging Markets Fund's fundamental restriction on loans is significantly
more limiting than is required by the 1940 Act in limiting loans to 10% of the
Fund's assets. The proposal increases Emerging Markets Fund's lending
authority from 10% to 33 1/3% of its total assets. The Board believes that the
proposed change, making the Fund's fundamental restriction on loans no more
limiting than is required by the 1940 Act, will give the Fund greater
flexibility to respond to future contingencies.
k. Elimination of fundamental restriction on Fund ownership of securities also
owned by directors and officers of each Fund or its investment adviser
(European Fund and Pacific Basin Fund only)
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction concerning Fund ownership of securities also owned by officers and
directors of each Fund or its investment adviser as follows:
The Fund may not purchase securities of any company in which any officer
or director of the Company or its investment adviser owns more than 1/2
of 1% of the outstanding securities of such company and in which the
officers and directors of the Company and its investment adviser, as a
group, own more than 5% of such securities.
The Board recommends that shareholders vote to eliminate this restriction.
Funds are not legally required to have a fundamental restriction limiting or
prohibiting the purchase of securities of companies that are also owned by
affiliated parties of the fund. This restriction was derived from state laws
that are no longer applicable. The concerns that this restriction was designed
to address are sufficiently safeguarded against by provisions of the 1940 Act
applicable to European Fund and Pacific Basin Fund, as well as by the Funds'
other fundamental restrictions. Specifically, to the extent that this seeks to
limit possible conflicts of interest arising out of transactions with
affiliated parties, the restriction is unnecessary and unduly burdensome
because the Funds are subject to the extensive affiliated transaction
provisions of the 1940 Act. Because this restriction provides no additional
protections to shareholders and may hinder the Board in pursuing investment
strategies that may be advantageous to the Funds, the Board recommends that
this investment restriction be eliminated.
13
<PAGE>
l.Modification of fundamental policy on issuer diversification
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on issuer diversification as follows:
The Fund may not purchase securities (except obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities) if
the purchase would cause a Fund at the time to have more than 5% of the
value of its total assets invested in the securities of any one issuer
or to own more than 10% of the outstanding voting securities of any one
issuer.
Emerging Markets Fund currently has the following fundamental restriction on
issuer diversification:
The Fund may not, with respect to seventy-five percent (75%) of the
Fund's total assets, purchase the securities of any one issuer (except
cash items and "government securities" as defined under the 1940 Act),
if the purchase would cause the Fund to have more than 5% of the value
of its total assets invested in the securities of such issuer or to own
more than 10% of the outstanding voting securities of such issuer.
The Board recommends that these fundamental restrictions be replaced with
the following fundamental restriction:
The Fund may not, with respect to 75% of the Fund's total assets,
purchase the securities of any issuer (other than securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities, or securities of other investment companies) if, as a
result, (i) more than 5% of the Fund's total assets would be invested in
the securities of that issuer, or (ii) the Fund would hold more than 10%
of the outstanding voting securities of that issuer.
The proposed fundamental restriction concerning diversification is the
limitation imposed by the 1940 Act for diversified investment companies. The
amended fundamental restriction would now allow European Fund and Pacific
Basin Fund, and would continue to allow Emerging Markets Fund, with respect to
25% of their respective total assets, to invest more than 5% of those assets
in the securities of one or more issuers and to hold more than 10% of the
voting securities of an issuer. European Fund and Pacific Basin Fund would now
be required to invest 75%, instead of 100%, of their respective total assets
so that no more than 5% of total assets are invested in any one issuer, and so
that each Fund will not own more than 10% of the voting securities of an
issuer. This requirement would continue to apply to Emerging Markets Fund.
The amended fundamental restriction would give the European Fund and Pacific
Basin Fund greater investment flexibility by permitting each of them to
acquire larger positions in the securities of a particular issuer, consistent
with its investment objectives and strategies. This increased flexibility
could provide opportunities to enhance each Fund's performance. Investing a
large percentage of a Fund's assets in a single issuer's securities, however,
increases that Fund's exposure to credit and other risks associated with that
issuer's financial condition and operations, including the risk of default on
debt securities.
The amended fundamental restriction also would permit each of the Funds to
invest without limit in the securities of other investment companies. The
Funds have no current intention of doing so, and the 1940 Act imposes
restrictions on the extent to which a fund may invest in the securities of
other investment companies. The revision would, however, give the Funds
flexibility to invest in other investment companies in the event legal and
other regulatory requirements change.
14
<PAGE>
m.Modification of fundamental restriction on industry concentration and
adoption of non-fundamental interpretation on classification of foreign
governments for concentration purposes
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction on industry concentration as follows:
A fundamental policy of the INVESCO Pacific Basin Fund and the INVESCO
European Fund is not to invest more than 25% of their respective total
assets in the securities of issuers in any one industry.
Emerging Markets Fund currently has the following fundamental restriction on
industry concentration:
The Fund may not invest more than 25% of the value of its total assets in
any particular industry (other than government securities).
The Board recommends that shareholders vote to replace these fundamental
restrictions with the following fundamental restriction:
The Fund may not purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities or municipal securities) if, as a result,
more than 25% of the Fund's total assets would be invested in securities
of companies whose principal business activities are in the same
industry.
If the proposal is approved, the Board will adopt the following non-
fundamental interpretation:
With respect to fundamental restriction (( ) for European Fund and Pacific
Basin Fund and ( ) for Emerging Markets Fund), investments in obligations
issued by a foreign government, including the agencies or instrumentalities of
a foreign government, are considered to be investments in a single industry.
The primary purpose of the modification is to eliminate minor differences in
the wording of the INVESCO Funds' current fundamental restrictions on industry
concentration for greater uniformity and to avoid unintended limitations
without materially altering the restriction. The proposed fundamental
restriction on concentration excludes municipal securities and securities
issued or guaranteed by the U.S. government, its agencies or instrumentalities
from the concentration limitation. The current fundamental restriction on
concentration for European Fund and Pacific Basin Fund contains no such
exclusion, and the Emerging Markets Fund's current fundamental restriction on
concentration excludes only "government securities." A failure to exclude
securities issued of U.S. government agencies and instrumentalities and
municipal securities from the fundamental restriction on concentration could
hinder each Fund's ability to purchase such securities in conjunction with
taking temporary defensive positions.
n.Elimination of fundamental restriction on investing in newly formed issuers
(European Fund and Pacific Basin Fund only)
Each of European Fund and Pacific Basin Fund currently has a fundamental
restriction against investing in newly formed issuers as follows:
The Fund may not invest more than 5% of its total assets in an issuer
having a record, together with predecessors, of less than three years'
continuous operation.
The Board recommends the elimination of this fundamental restriction. This
restriction is derived from a state "blue sky" requirement that has been pre-
empted by recent amendments of the federal securities laws. Companies with
less than three years of continuous operation are typically referred to as
newly formed issuers or "unseasoned
15
<PAGE>
issuers." Because newly formed companies have no proven track record in
business, their prospects may be uncertain. Their securities may fluctuate in
price more unduly than securities of established companies. The Board believes
that elimination of this fundamental restriction will provide European Fund
and Pacific Basin Fund with greater investment flexibility. If this proposal
is approved, Funds will be able to invest in the securities of newly formed
issuers, in accordance with their investment objectives, policies and
restrictions.
Required Vote. Approval of Proposal 2 with respect to a Fund requires the
affirmative vote of a "majority of the outstanding voting securities" of that
Fund, which for this purpose means the affirmative vote of the lesser of: (1)
67% or more of the shares of that Fund present at the Meeting or represented
by proxy if more than 50% of the outstanding shares of that Fund are so
present or represented; or (2) more than 50% of the outstanding shares of that
Fund. Shareholders who vote "for" Proposal 2 will vote "for" each proposed
change described above. Those shareholders who wish to vote against any of the
specific proposed changes described above may do so on the proxy provided.
Only those specific proposed changes approved by the required vote will become
effective.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" PROPOSAL 2.
PROPOSAL 3: TO ELECT THE DIRECTORS OF INTERNATIONAL FUNDS
The Board has nominated the individuals identified below for election to the
Board at the Meeting. International Funds currently has ten directors.
Vacancies on the Board are generally filled by appointment by the remaining
directors. However, the 1940 Act provides that vacancies may not be filled by
directors unless thereafter at least two-thirds of the directors shall have
been elected by shareholders. To ensure continued compliance with this rule
without incurring the expense of calling additional shareholder meetings,
shareholders are being asked at this Meeting to elect the current ten
directors to hold office until the next meeting of shareholders. Consistent
with the by-laws of International Funds, and as permitted by Maryland law,
International Funds does not anticipate holding annual shareholder meetings.
Thus, the directors will be elected for indefinite terms, subject to
termination or resignation. Each nominee has indicated a willingness to serve
if elected. If any of the nominees should not be available for election, the
persons named as proxies (or their substitutes) may vote for other persons in
their discretion. Management has no reason to believe that any nominee will be
unavailable for election.
All of the Independent Directors (i.e., directors who are not "interested
persons" of International Funds, as such term is defined in the 1940 Act) now
being proposed for election were nominated and selected by Independent
Directors. Eight of the ten current directors are Independent Directors.
The persons named as attorneys-in-fact in the enclosed proxy have advised
International Funds that unless a proxy instructs them to withhold authority
to vote for all listed nominees or for any individual nominee, they will vote
all validly executed proxies for the election of the nominees named below.
16
<PAGE>
The nominees for director, their ages, a description of their principal
occupations, the number of International Funds' shares owned by each, and their
respective memberships on Board committees are listed in the table below.
<TABLE>
<CAPTION>
Number of
International
Funds' Shares
Owned Directly
Director or or Indirectly
Name, Position with Principal Occupation Executive Officer on
International Funds, and and Business Experience of International Dec. 31, Member of
Age (during the past five years) Funds Since 1998 (1) Committee
- --------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Charles W. Brady, Chief Executive Officer and Director 1993 0 (3),(5),(6)
Chairman of the Board, of AMVESCAP PLC, London, England,
Age 63* and of various subsidiaries thereof.
Chairman of the Board of INVESCO
Global Health Sciences Fund.
Fred A. Deering, Trustee of INVESCO Global Health 1993 65.865 (2),(3),(5)
Vice Chairman of the Sciences Fund. Formerly, Chairman of
Board, the Executive Committee and Chairman
Age 70 of the Board of Security Life of
Denver Insurance Company, Denver,
Colorado; Director of ING American
Holdings Company and First ING Life
Insurance Company of New York.
Mark H. Williamson, President, Chief Executive Officer, 1998 0 (3),(5)
President, Chief Executive and Director, INVESCO Distributors
Officer, and Director, Inc.; President, Chief Executive
Age 47* Officer, and Director, INVESCO;
President, Chief Operating Officer,
and Trustee INVESCO Global Health
Sciences Fund. Formerly, Chairman of
the Board and Chief Executive
Officer, NationsBanc Advisors, Inc.
(1995-1997); Chairman of the Board,
NationsBanc Investments, Inc. (1997-
1998).
Dr. Victor L. Andrews, Professor Emeritus, Chairman 1993 65.865 (4),(6),(8)
Director, Emeritus and Chairman of the CFO
Age 68 Roundtable of the Department of
Finance of Georgia State University,
Atlanta, Georgia and President,
Andrews Financial Associates, Inc.
(consulting firm). Formerly, member
of the faculties of the Harvard
Business School and the Sloan School
of Management of MIT. Dr. Andrews is
also a director of the Sheffield
Funds, Inc.
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
Number of
International
Funds' Shares
Owned
Director or Directly or
Name, Position with Principal Occupation Executive Officer Indirectly on
International Funds, and Business Experience of International Dec. 31, Member of
and Age (during the past five years) Funds Since 1998 (1) Committee
- ------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Bob R. Baker, President and Chief Executive 1993 65.865 (3),(4),(5)
Director, Officer of AMC Cancer Research
Age 62 Center, Denver, Colorado, since
January 1989; until December 1988,
Vice Chairman of the Board, First
Columbia Financial Corporation,
Englewood, Colorado. Formerly,
Chairman of the Board and Chief
Executive Officer of First Columbia
Financial Corporation.
Lawrence H. Budner, Trust Consultant. Prior to June 1993 65.865 (2),(6),(7)
Director, 1987, Senior Vice President and
Age 68 Senior Trust Officer, InterFirst
Bank, Dallas, Texas.
Dr. Wendy Lee Gramm, Self-employed (since 1993). 1997 65.865 (4),(8)
Director, Professor of Economics and Public
Age 54 Administration, University of Texas
at Arlington. Formerly, Chairman,
Commodities Futures Trading
Commission (1988-1993);
Administrator for Information and
Regulatory Affairs, Office of
Management and Budget (1985-1988);
Executive Director, Presidential
Task Force on Regulatory Relief;
Director, Federal Trade Commission's
Bureau of Economics. Director of the
Chicago Mercantile Exchange, Enron
Corporation, IBP, Inc., State Farm
Insurance Company, Independent
Women's Forum, International
Republic Institute, and the
Republican Women's Federal Forum.
Kenneth T. King, Presently retired. Formerly, 1993 65.865 (2),(3),(5),(6),
Director, Chairman of the Board, The Capitol (7)
Age 73 Life Insurance Company, Providence
Washington Insurance Company, and
Director of numerous U.S.
subsidiaries thereof. Formerly,
Chairman of the Board, The
Providence Capitol Companies in the
United Kingdom and Guernsey. Until
1987, Chairman of the Board, Symbion
Corporation.
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
Number of
International
Funds' Shares
Owned
Name, Position Director or Directly or
with Principal Occupation Executive Officer Indirectly on
International and Business Experience of International Dec. 31, Member of
Funds, and Age (during the past five years) Funds Since 1998 (1) Committee
- --------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
John W. McIntyre, Presently retired. Formerly, Vice 1995 65.865 (2),(3),(5),(7)
Director, Chairman of the Board, The Citizens
Age 68 and Southern Corporation; Chairman
of the Board and Chief Executive
Officer, The Citizens and Southern
Georgia Corporation; Chairman of the
Board and Chief Executive Officer,
The Citizens and Southern National
Bank. Trustee of INVESCO Global
Health Sciences Fund and Gables
Residential Trust, Employee's
Retirement System of Georgia, Emory
University, and the J.M. Tull
Charitable Foundation. Director of
Kaiser Foundation Health Plans of
Georgia, Inc.
Dr. Larry Soll, Presently retired. Formerly, 1997 65.865 (4),(8)
Director, Chairman of the Board (1987-1994),
Age 56 Chief Executive Officer (1982-1989
and 1993-1994) and President (1982-
1989) of Synergen Inc., Director of
Synergen Inc. since incorporation in
1982. Director of Isis
Pharmaceuticals, Inc. Trustee of
INVESCO Global Health Sciences Fund.
</TABLE>
*Because of his affiliation with INVESCO, with a Fund's investment adviser, or
with companies affiliated with INVESCO, this individual is deemed to be
an "interested person" of International Funds, as that term is defined
in the 1940 Act.
(1) As interpreted by the SEC, a security is beneficially owned by a person
if that person has or shares voting power or investment power with
respect to that security. The persons listed have partial or complete
voting and investment power with respect to their respective Fund
shares.
(2) Member of the Audit Committee
(3) Member of the Executive Committee
(4) Member of the Management Liaison Committee
(5) Member of the Valuation Committee
(6) Member of the Compensation Committee
(7) Member of the Soft Dollar Brokerage Committee
(8) Member of the Derivatives Committee
19
<PAGE>
The Board has audit, management liaison, soft dollar brokerage, and
derivatives committees consisting of Independent Directors, and compensation,
executive, and valuation committees consisting of Independent Directors and
non-independent directors. The Board does not have a nominating committee. The
audit committee, consisting of four Independent Directors, meets quarterly
with the independent accountants and executive officers of International
Funds. This committee reviews the accounting principles being applied by
International Funds in financial reporting, the scope and adequacy of internal
controls, the responsibilities and fees of the independent accountants, and
other matters. All of the recommendations of the audit committee are reported
to the full Board. During the intervals between the meetings of the Board, the
executive committee may exercise all powers and authority of the Board in the
management of the business of International Funds, except for certain powers
which, under applicable law and/or the by-laws of International Funds, may
only be exercised by the full Board. All decisions by the executive committee
are subsequently submitted for ratification by the Board. The management
liaison committee meets quarterly with various management personnel of INVESCO
in order to facilitate better understanding of management and operations of
International Funds, and to review legal and operational matters that have
been assigned to the committee by the Board, in furtherance of the Board's
overall duty of supervision. The soft dollar brokerage committee meets
periodically to review soft dollar transactions by International Funds, and to
review policies and procedures of International Funds' adviser with respect to
soft dollar brokerage transactions. The committee then reports on these
matters to the Board. The derivatives committee meets periodically to review
derivatives investments made by International Funds. The committee monitors
derivatives usage by International Funds and the procedures utilized by
International Funds' adviser to ensure that the use of such instruments
follows the policies on such instruments adopted by the Board. The committee
then reports on these matters to the Board.
Each Independent Director receives an annual retainer of $56,000 for their
service to the INVESCO Funds. Additionally, each Independent Director receives
$3,000 for in-person attendance at each board meeting and $1,000 for in-person
attendance at each committee meeting. The chairmen of the audit and management
liaison committees receive an annual fee of $4,000 for serving in such
capacity.
During the past fiscal year, the Board met four times, the audit committee
met four times, the compensation committee met once, the management liaison
committee met four times, the soft dollar brokerage committee met twice, and
the derivatives committee met once. The executive committee did not meet.
During the last fiscal year of International Funds, each Director attended 75%
or more of the Board meetings and meetings of the committees of the Board on
which he or she served.
The Independent Directors nominate individuals to serve as Independent
Directors, without any specific nominating committee. The Board ordinarily
will not consider unsolicited director nominations recommended by the Funds'
shareholders. The Board, including its Independent Directors, unanimously
approved the nomination of the foregoing persons to serve as directors and
directed that the election of these nominees be submitted to International
Funds' shareholders.
The following table sets forth information relating to the compensation paid
to directors during the last fiscal year:
20
<PAGE>
COMPENSATION TABLE
AMOUNTS PAID DURING THE MOST RECENT
FISCAL YEAR BY INTERNATIONAL FUNDS TO DIRECTORS
<TABLE>
<CAPTION>
Total
Compensation
from International
Pension or Funds and
Retirement Benefits the other 14
Aggregate Accrued as Part of Estimated Annual INVESCO Funds
Compensation from International Benefits Upon Paid to
Name of Person, Position International Funds(1) Funds Expenses(2) Retirement(3) Directors(1)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fred A. Deering,
Vice Chairman of the
Board and Director $ 4,395 $1,355 $ 870 $103,700
Dr. Victor L. Andrews,
Director $ 4,306 $1,281 $1,107 $ 80,350
Bob R. Baker,
Director $ 4,421 $1,143 $1,349 $ 84,000
Lawrence H. Budner,
Director $ 4,240 $1,281 $1,007 $ 79,350
Daniel D. Chabris(4),
Director $ 4,330 $1,384 $ 751 $ 70,000
Dr. Wendy L. Gramm,
Director $ 4,163 $ 0 $ 0 $ 79,000
Kenneth T. King,
Director $ 4,151 $1,407 $ 789 $ 77,050
John W. McIntyre,
Director $ 4,198 $ 0 $ 0 $ 98,500
Dr. Larry Soll,
Director $ 4,198 $ 0 $ 0 $ 96,000
------- ------ ------ --------
TOTAL $38,402 $7,851 $5,773 $767,950
======= ====== ====== ========
AS A PERCENTAGE OF NET
ASSETS 0.0050%(5) 0.0010%(5) 0.0035%(6)
</TABLE>
21
<PAGE>
- --------
(1) The Vice Chairman of the Board, the chairmen of the audit, management
liaison, derivatives, soft dollar brokerage and compensation committees, and
Independent Director members of the committees of International Funds receive
compensation for serving in such capacities in addition to the compensation
paid to all Independent Directors.
(2) Represents benefits accrued with respect to the Defined Benefit Deferred
Compensation Plan discussed below, and not compensation deferred at the
election of the directors.
(3) These figures represent the Funds' share of the estimated annual benefits
payable by the INVESCO Complex (excluding INVESCO Global Health Sciences Fund,
which does not participate in this retirement plan) upon the directors'
retirement, calculated using the current method of allocating director
compensation among the INVESCO Funds. These estimated benefits assume
retirement at age 72 and that the basic retainer payable to the directors will
be adjusted periodically for inflation, for increases in the number of funds
in the INVESCO Complex, and for other reasons during the period in which
retirement benefits are accrued on behalf of the respective directors. This
results in lower estimated benefits for directors who are closer to retirement
and higher estimated benefits for directors who are farther from retirement.
With the exception of Drs. Soll and Gramm, each of these directors has served
as director of one or more of the INVESCO Funds for the minimum five-year
period required to be eligible to participate in the Defined Benefit Deferred
Compensation Plan. Although Mr. McIntyre became eligible to participate in the
Defined Benefit Deferred Compensation Plan as of November 1, 1998, he will not
be included in the calculation of retirement benefits until November 1, 1999.
(4) Mr. Chabris retired as a director effective September 30, 1998.
(5)Total as a percentage of the Funds' net assets as of December 31, 1998.
(6)Total as a percentage of the net assets of the 15 INVESCO Funds in the
INVESCO Complex as of December 31, 1998.
International Funds pays its Independent Directors, Board vice chairman,
committee chairmen and committee members the fees described above.
International Funds also reimburses its Independent Directors for travel
expenses incurred in attending meetings. Charles W. Brady, Chairman of the
Board, and Mark H. Williamson, President, Chief Executive Officer, and
Director, as "interested persons" of International Funds and of other INVESCO
Funds, receive compensation and are reimbursed for travel expenses incurred in
attending meetings as officers or employees of INVESCO or its affiliated
companies, but do not receive any director's fees or other compensation from
International Funds or other INVESCO Funds for their services as directors.
The overall direction and supervision of International Funds is the
responsibility of the Board, which has the primary duty of ensuring that
International Funds' general investment policies and programs are adhered to
and that International Funds is properly administered. The officers of
International Funds, all of whom are officers and employees of and paid by
INVESCO, are responsible for the day-to-day administration of International
Funds. The investment adviser for International Funds has the primary
responsibility for making investment decisions on behalf of International
Funds. These investment decisions are reviewed by the investment committee of
INVESCO.
All of the officers and directors of International Funds hold comparable
positions with the following INVESCO Funds: INVESCO Bond Funds, Inc.
(formerly, INVESCO Income Funds, Inc.), INVESCO Combination Stock & Bond
Funds, Inc. (formerly, INVESCO Flexible Funds, Inc. and INVESCO Multiple Asset
Funds, Inc.), INVESCO Diversified Funds, Inc., INVESCO Emerging Opportunity
Funds, Inc., INVESCO Growth Funds, Inc., (formerly INVESCO Growth Fund, Inc.),
INVESCO Industrial Income Fund, Inc., INVESCO Money Market Funds, Inc.,
INVESCO Sector Funds, Inc. (formerly, INVESCO Strategic Funds, Inc.), INVESCO
Specialty Funds, Inc., INVESCO Stock Funds, Inc. (formerly, INVESCO Equity
Funds, Inc. and INVESCO Capital Appreciation Funds, Inc.), INVESCO Tax-Free
Income Funds, Inc., INVESCO Variable Investment Funds, Inc., INVESCO Value
Trust, and INVESCO Treasurer's Series Trust.
The Boards of the Funds managed by INVESCO have adopted a Defined Benefit
Deferred Compensation Plan (the "Plan") for the non-interested directors and
trustees of the Funds. Under the Plan, each director or trustee who is not an
interested person of the Funds (as defined in Section 2(a)(19) of the 1940
Act) and who has served for at least five years (a "Qualified Director") is
entitled to receive, upon termination of service as director (normally at
retirement age of 72 or the retirement age of 73 or 74, if the retirement date
is extended by the Boards for one or two
22
<PAGE>
years, but less than three years) continuation of payment for one year (the
"First Year Retirement Benefit") of the annual basic retainer and annualized
board meeting fees payable by the Funds to the Qualified Directors at the time
of his or her retirement (the "Basic Benefit"). Commencing with any such
director's second year of retirement, and commencing with the first year of
retirement of any director whose retirement has been extended by the Board for
three years, a Qualified Director shall receive quarterly payments at an
annual rate equal to 50% of the Basic Benefit. These payments will continue
for the remainder of the Qualified Director's life or ten years, whichever is
longer (the "Reduced Benefit Payments"). If a Qualified Director dies or
becomes disabled after age 72 and before age 74 while still a director of the
Funds, the First Year Retirement Benefit and Reduced Benefit Payments will be
made to him or her or to his or her beneficiary or estate. If a Qualified
Director becomes disabled or dies either prior to age 72 or during his or her
74th year while still a director of the Funds, the director will not be
entitled to receive the First Year Retirement Benefit; however, the Reduced
Benefit Payments will be made to his or her beneficiary or estate. The Plan is
administered by a committee of three directors who are also participants in
the Plan and one director who is not a Plan participant. The cost of the Plan
will be allocated among the INVESCO Funds in a manner determined to be fair
and equitable by the committee. The Funds began making payments to Mr. Chabris
as of October 1, 1998 under the Plan. International Funds has no stock options
or other pension or retirement plans for management or other personnel and
pays no salary or compensation to any of its officers.
The Independent Directors have contributed to a deferred compensation plan,
pursuant to which they have deferred receipt of a portion of the compensation
which they would otherwise have been paid as directors of certain of the
INVESCO Funds. The deferred amounts have been invested in shares of certain
INVESCO Funds. Each Independent Director may, therefore, be deemed to have an
indirect interest in shares of each such INVESCO Fund, in addition to any Fund
shares that they may own directly or beneficially.
Required Vote. Election of each nominee as a director of International Funds
requires the vote of a plurality of the votes of International Funds cast at
the Meeting in person or by proxy.
THE BOARD, INCLUDING THE INDEPENDENT DIRECTORS,
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" EACH OF THE NOMINEES IN PROPOSAL 3.
PROPOSAL 4: RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Board of International Funds, including all of its Independent
Directors, has selected PricewaterhouseCoopers LLP to continue to serve as
independent accountants of each Fund, subject to ratification by each Fund's
shareholders. PricewaterhouseCoopers LLP has no direct financial interest or
material indirect financial interest in any of the Funds. Representatives of
PricewaterhouseCoopers LLP are not expected to attend the Meeting, but have
been given the opportunity to make a statement if they so desire, and will be
available should any matter arise requiring their presence.
The independent accountants examine annual financial statements for the
Funds and provide other audit and tax-related services. In recommending the
selection of PricewaterhouseCoopers LLP, the Board reviewed the nature and
scope of the services to be provided (including non-audit services) and
whether the performance of such services would affect the accountants'
independence.
23
<PAGE>
Required Vote. Ratification of the selection of PriceWaterhouseCoopers LLP
as independent accountants with respect to a Fund requires the vote of a
majority of the votes of that Fund present at the Meeting, provided a quorum
is present with respect to that Fund.
THE BOARD UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE "FOR" PROPOSAL 4.
INFORMATION CONCERNING ADVISER, SUB-ADVISER,
DISTRIBUTOR AND AFFILIATED COMPANIES
INVESCO, a Delaware corporation, serves as each Fund's investment adviser,
and provides other services to each Fund and to International Funds. IDI, a
Delaware corporation, serves as each Fund's distributor. INVESCO Asset
Management Limited ("IAML") serves as investment sub-adviser to European Fund
and Pacific Basin Fund. INVESCO Global Asset Management ("IGAM") serves as
investment sub-adviser to International Blue Chip Fund. INVESCO is a wholly
owned subsidiary of INVESCO North American Holdings, Inc. ("INAH"). INAH is an
indirect wholly owned subsidiary of AMVESCAP PLC./1/
The corporate headquarters of AMVESCAP PLC are located at 11 Devonshire
Square, London, EC2M 4YR, England. INVESCO's and IDI's offices are located at
7800 East Union Avenue, Denver, Colorado 80237. IAML's offices are located at
11 Devonshire Square, London, EC2M 4YR, England. IGAM's offices are located at
1355 Peachtree Street, N.E., Atlanta, Georgia 30309. INAH's offices are
located at 1315 Peachtree Street, N.E., Atlanta, Georgia 30309. INVESCO
currently serves as investment adviser of 14 open-end investment companies
having approximate aggregate net assets in excess of $21.1 billion, as of
December 31, 1998.
The principal executive officers and directors of INVESCO and their
principal occupations are:
Mark H. Williamson, Chairman of the Board, President, Chief Executive
Officer and Director, also, President and Chief Executive Officer of IDI;
Charles Mayer, Senior Vice President and Director, also, Senior Vice President
and Director of IDI; Ronald L. Grooms, Director, Senior Vice President and
Treasurer, also Director, Senior Vice President and Treasurer of IDI; Richard
W. Healey, Senior Vice President and Director, also, Senior Vice President and
Director of IDI; Timothy J. Miller, Senior Vice President and Director, also,
Senior Vice President and Director of IDI; and Glen A. Payne, Senior Vice
President, Secretary and General Counsel, also Senior Vice President,
Secretary and General Counsel of IDI.
The address of each of the foregoing officers and directors is 7800 East
Union Avenue, Denver, Colorado 80237.
INVESCO, as investment adviser, has contracted with IAML, as investment sub-
adviser, to provide portfolio investment advisory services to European Fund
and Pacific Basin Fund. IAML also acts as sub-adviser to INVESCO Emerging
Markets Fund, INVESCO European Small Company Fund, INVESCO International
Growth Fund, and INVESCO Latin American Growth Fund. The principal executive
officers and directors of IAML and their principal occupations are:
Tristan Hillgarth, Chief Executive Officer; Dennis Elliot, Director; Jeremy
Lambourne, Director; Dallas McGillivray, Director; Anthony Myers, Director;
Graeme Proudfoot, Director; Riccardo Ricciardi, Director; Martin
/1/The intermediary companies between INAH and AMVESCAP PLC are as follows:
INVESCO, Inc., AMVESCAP Group Services, Inc., AVZ, Inc. and INVESCO North
American Group, Ltd., each of which is wholly owned by its immediate parent.
24
<PAGE>
Trowell, Director; Hugh Ward, Director; Roger Yates, Director; Michael Perman,
Secretary; and Robert Cachett, Secretary.
The address of each of the foregoing officers and directors is 11 Devonshire
Square, London, EC2M 4YR, England.
INVESCO, as investment adviser, has contracted with IGAM, as investment sub-
adviser, to provide portfolio investment advisory services to International
Blue Chip Fund. IGAM also acts as sub-adviser to I.R.T. International Equity
Fund, I.R.T. International Bond Fund, I.R.T. Lifestyle Aggressive Fund, I.R.T.
Lifestyle Moderate Fund, and I.R.T. Lifestyle Conservative Fund. The principal
executive officers and directors of IGAM and their principal occupations are:
The Hon. Michael Benson, Chairman and Director; John D. Rogers, President,
Chief Executive Officer and Director; Wendell M. Starke, Director; Stephen A.
Dana, Director; Luis Aguilar, Vice President, Secretary, General Counsel and
Director; William L. Davidson, Vice President; Erik B. Granade, Vice
President; Kirk F. Holland, Vice President; and Deborah Lamb, Assistant
Secretary.
The address of each of the foregoing officers and directors is 1355
Peachtree Street, N.E., Atlanta, Georgia 30309.
Pursuant to an Administrative Services Agreement between International Funds
and INVESCO, INVESCO provides administrative services to International Funds,
including sub-accounting and recordkeeping services and functions. During the
fiscal year ended October 31, 1998, International Funds paid INVESCO, which
also serves as International Funds' registrar, transfer agent and dividend
disbursing agent, total compensation of $2,087,461 for such services.
OTHER BUSINESS
The Board knows of no other business to be brought before the Meeting. If,
however, any other matters properly come before the Meeting, it is the
intention that proxies that do not contain specific instructions to the
contrary will be voted on such matters in accordance with the judgment of the
persons designated in the proxies.
SHAREHOLDER PROPOSALS
International Funds does not hold annual meetings of shareholders.
Shareholders wishing to submit proposals for inclusion in a proxy statement
and form of proxy for a subsequent shareholders' meeting should send their
written proposals to the Secretary of International Funds, 7800 East Union
Avenue, Denver, Colorado 80237. International Funds has not received any
shareholder proposals to be presented at this Meeting.
By Order of the Board of Directors,
/s/ Glen A. Payne
-----------------------
Glen A. Payne
Secretary
March 23, 1999
25
<PAGE>
APPENDIX A
PRINCIPAL SHAREHOLDERS
The following table sets forth the beneficial ownership of each Fund's
outstanding equity securities as of March 12, 1999 by each beneficial owner of
5% or more of a Fund's outstanding equity securities.
<TABLE>
<CAPTION>
Beneficial owners of 5% or more of Emerging Markets Fund:
---------------------------------------------------------
Amount and Nature
Name and Address of Ownership Percentage
- ---------------- -------------------- ----------
<S> <C> <C>
INVESCO Funds Group, Inc. 36,855.2710 24.25%
Attn: Sheila Wendland Record
P.O. Box 173706
Denver, CO 80217-3706
Charles Schwab & Co. Inc. 10,084.3420 6.64%
Special Custody Account for the Exclusive Ben-
efit of Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
<CAPTION>
Beneficial owners of 5% or more of European Fund
------------------------------------------------
Amount and Nature of
Name and Address Ownership Percentage
- ---------------- -------------------- ----------
<S> <C> <C>
Charles Schwab & Co. Inc. 14,087,664.4950 33.21%
Special Custody Account for the Exclusive Ben-
efit of Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
National Financial Services Corp. 3,687,716.0920 8.69%
The Exclusive Benefit of Customers
Attn: Kate- Recon
One World Financial Center
200 Liberty Street, 5th Floor
New York, NY 10281-1003
</TABLE>
A-1
<PAGE>
<TABLE>
<CAPTION>
Amount and Nature
Name and Address of Ownership Percentage
- ---------------- ----------------- ----------
Beneficial owners of 5% or more of Pacific Basin Fund:
-------------------------------------------------------
<S> <C> <C>
Charles Schwab & Co. Inc. 2,170,779.5450 30.55%
Special Custody Account for the Exclusive Benefit
of Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
<CAPTION>
Beneficial owners of 5% or more of International Blue Chip Fund
---------------------------------------------------------------
<S> <C> <C>
Muir & Co. 867,800.0370 46.93%
P.O. Box 2479 Record
San Antonio, TX 78298-2479
Charles Schwab & Co. Inc. 244,546.8690 13.23%
Special Custody Account for the Exclusive Benefit
of Customers Record
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104-4122
U.S. Bank National Association Cust. 195,867.3740 10.59%
Saint Paul Chamber Orchestra Record
Attn: Mutual Funds
Acct. 10623860
P.O. Box 64010
Saint Paul, MN 55164-0010
Saxon & Co. 136,399.2170 7.38%
CUSIP 46127X504 Record
Acct. 35-35-001-0182155
P.O. Box 7780-1888
Philadelphia, PA 19182-0001
</TABLE>
A-2
<PAGE>
APPENDIX B
PLAN OF LIQUIDATION AND TERMINATION
INVESCO EMERGING MARKETS FUND
THIS PLAN OF LIQUIDATION AND TERMINATION ("Plan") is made by INVESCO
International Funds, Inc., a Maryland open-end investment company
("Corporation"), with respect to INVESCO Emerging Markets Fund, a segregated
portfolio of assets ("series") thereof ("Fund").
WHEREAS, the Corporation's board of directors ("Board") has determined that
liquidation and termination of the Fund is in the best interests of the
Corporation and the Fund and accordingly has adopted this Plan;
WHEREAS, Article III, Section 4, of the Corporation's Articles of
Incorporation provides that the Board may redeem shares of any series of stock
from its shareholders; and
WHEREAS, pursuant to Article III, Section 3(f), of the Corporation's
Articles of Incorporation, liquidation of the Fund as a series of the
Corporation requires the affirmative vote of the lesser of (1) 67% of the
Fund's shares present at a meeting of its shareholders if the holders of more
than 50% of its outstanding shares are present in person or by proxy or (2)
more than 50% of the Fund's outstanding shares ("Required Vote").
NOW THEREFORE, this Plan shall be effective upon receipt of the Required
Vote.
ARTICLE I. Actions to Be Taken Prior to Liquidation
(a) As directed by the Board, the Fund shall proceed with the business of
winding up its affairs.
(b) The Board shall authorize the appropriate parties to wind up the Fund's
affairs, and all the powers of the Corporation's directors under its Articles
of Incorporation and by-laws shall continue with respect to the Fund until its
affairs have been wound up, including the powers to (i) fulfill or discharge
the Fund's contracts, (ii) collect the Fund's assets, (iii) sell, convey,
assign, exchange, transfer, or otherwise dispose of all or any part of the
remaining property of the Fund to one or more persons at public or private
sale for consideration that may consist in whole or in part of cash,
securities, or other property of any kind, (iv) discharge or pay the Fund's
liabilities, (v) prosecute, settle, or compromise claims of the Fund or to
which the Fund is subject, (vi) file final state and federal tax returns for
the Fund, (vii) mail notice to all known creditors and employees, if any, of
the Fund, at their respective addresses shown on the Fund's records, and
(viii) do all other acts necessary or appropriate to wind up the Fund's
business.
(c) As directed by the Board, the Corporation shall make one or two
liquidating distributions to the Fund's shareholders of record as of the date
of the Required Vote (individually a "Shareholder" and collectively
"Shareholders") in cancellation and redemption of their Fund shares. The
amount of each liquidating distribution to each Shareholder shall be in
proportion to the number of Fund shares held thereby.
ARTICLE II. Filings with the State of Maryland
(a) The Board shall authorize the appropriate parties to file for and obtain
(i) a tax clearance certificate from the Comptroller of the Treasury of
Maryland or the collector of taxes stating that all taxes payable by the Fund
have been paid or provided for and (ii) if the Fund has employees, a
certificate from the Secretary of Economic and Employment Development of
Maryland stating that all unemployment insurance contribution, reimbursement
payments, and interest have been paid or provided for.
B-1
<PAGE>
(b) Upon cancellation of the Fund shares, the Board shall authorize the
appropriate parties to file Articles Supplementary with the Maryland
Department of Assessments and Taxation to eliminate the total number of shares
of stock allocated to the Fund and decrease, by an identical amount, the
aggregate number of shares of stock the Corporation has authority to issue.
ARTICLE III. Liquidation Procedures
(a) The Board shall authorize all actions to be taken such that the Fund
will apply its assets to the payment of all its existing debts and
obligations, including necessary expenses of redeeming and canceling the Fund
shares.
(b) On the date of the Required Vote, the interest of each Shareholder shall
be fixed and the books of the Funds shall be closed.
(c) As soon as reasonably practicable after (1) the Required Vote, (2)
paying or adequately providing for the payment of all Fund liabilities, and
(3) receipt of such releases, indemnities, and refunding agreements as the
Board deems necessary for its protection, the Board shall cause the remaining
assets of the Fund to be distributed in one or two (if necessary)
distributions of cash payments, with each Shareholder receiving his, her, or
its proportionate share of each payment, in cancellation and redemption of
his, her, or its Fund shares.
(d) If the Board is unable to make distributions to all the Shareholders
because of the inability to locate Shareholders to whom distributions in
cancellation and redemption of Fund shares are payable, the Board may create,
in the name and on behalf of the Fund, a trust with a financial institution
and, subject to applicable abandoned property laws, deposit any remaining
assets of the Fund in such trust for the benefit of the Shareholders that
cannot be located. The expenses of such trust shall be charged against the
assets therein.
ARTICLE IV. Amendment of this Plan
The Board may authorize variations from, or amendments of, the provisions of
this Plan (other than the terms of the liquidating distributions) that it
deems necessary or appropriate to effect the distributions in cancellation and
redemption of the Fund shares and the liquidation and termination of the
Fund's existence.
ARTICLE V. Expenses
The Fund shall bear 50% of all the expenses incurred in connection with
carrying out this Plan, including the cost of soliciting proxies, liquidating
its assets, and terminating its existence, and the remaining 50% will be borne
by INVESCO Funds Group, Inc.
B-2
<PAGE>
[Name and Address]
INVESCO EMERGING MARKETS FUND
INVESCO INTERNATIONAL FUNDS, Inc.
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Directors of
INVESCO International Funds, Inc. (the "Company") and relates to the proposals
with respect to the Company and to INVESCO Emerging Markets Fund ("Fund"), a
series of the Company. The undersigned hereby appoints as proxies Fred A.
Deering and Mark H. Williamson, and each of them (with power of substitution),
to vote all shares of common stock of the undersigned in the Fund at the Special
Meeting of Shareholders to be held at 10:00 a.m., Mountain Standard Time, on May
20, 1999, at the offices of the Company, 7800 East Union Avenue, Denver,
Colorado 80237, and any adjournment thereof ("Meeting"), with all the power the
undersigned would have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Company and to the Fund with discretionary
power to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLLFREE
OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION, PLEASE
FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO EMERGING MARKETS FUND
INVESCO INTERNATIONAL FUNDS, Inc.
<TABLE>
<S> <C> <C> <C> <C>
Vote on Directors FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
3. Election of the Company's Board of Directors: (1) Charles W. [_] [_] [_] To withhold authority
Brady; (2) Fred A. Deering; (3) Mark H. Williamson; (4) Dr. Victor L. to vote for any
Andrews; (5) Bob R. Baker; (6) Lawrence H. Budner; (7) Dr. Wendy Lee individual nominee(s),
Gramm; (8) Kenneth T. King; (9) John W. McIntyre; and (10) Dr. Larry mark "For All Except"
Soll; and write the
nominee's number on
the line below.
Vote On Proposals FOR AGAINST ABSTAIN
1. Approval of a Plan of Liquidation and Termination; [_] [_] [_]
2. Approval of changes to the fundamental investment restrictions; [_] [_] [_]
[_] To vote against the proposed changes to one or more of the specific
fundamental investment restrictions, but to approve others, PLACE AN
"X" IN THE BOX AT LEFT and indicate the letter(s) (as set forth in
the proxy statement) of the investment restriction or restrictions
you do not want to change on the line on the reverse side. If you
choose to vote differently on individual restrictions, you must mail
in your proxy card. If you choose to vote the same on all
restrictions pertaining to your fund, telephone and Internet voting
are available.
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
4. Ratification of the selection of PricewaterhouseCoopers LLP as the [_] [_] [_]
Fund's Independent Public Accountants.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name
of joint owners, each should sign. Attorneys-in-fact, executors,
administrators, etc. should so indicate. If shareholder is a corporation or
partnership, please sign in full corporate or partnership name by authorized
person.
- ------------------------------------------------------------------ ---------------
Signature Date
- ------------------------------------------------------------------ ---------------
Signature (Joint Owners) Date
</TABLE>
[Back]
To vote against the proposed changes to one or more of the specific fundamental
investment restrictions, indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote differently on individual
restrictions, you must mail in your proxy card. If you choose to vote the same
on all restrictions pertaining to your fund, telephone and Internet voting are
available.
2. ______________________________
<PAGE>
[Name and Address]
INVESCO EUROPEAN FUND
INVESCO INTERNATIONAL FUNDS, Inc.
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Directors of
INVESCO International Funds, Inc. (the "Company") and relates to the proposals
with respect to the Company and to INVESCO European Fund ("Fund"), a series of
the Company. The undersigned hereby appoints as proxies Fred A. Deering and
Mark H. Williamson, and each of them (with power of substitution), to vote all
shares of common stock of the undersigned in the Fund at the Special Meeting of
Shareholders to be held at 10:00 a.m., Mountain Standard Time, on May 20, 1999,
at the offices of the Company, 7800 East Union Avenue, Denver, Colorado 80237,
and any adjournment thereof ("Meeting"), with all the power the undersigned
would have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Company and to the Fund with discretionary
power to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO EUROPEAN FUND
INVESCO INTERNATIONAL FUNDS, Inc.
<TABLE>
<S> <C> <C> <C> <C>
Vote on Directors FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
2. Election of the Company's Board of Directors: (1) Charles W. [_] [_] [_] To withhold authority
Brady; (2) Fred A. Deering; (3) Mark H. Williamson; (4) Dr. Victor L. to vote, mark "For
Andrews; (5) Bob R. Baker; (6) Lawrence H. Budner; (7) Dr. Wendy Lee All Except" and write
Gramm; (8) Kenneth T. King; (9) John W. McIntyre; and (10) Dr. Larry the nominee's number
Soll; on the line below.
Vote On Proposals FOR AGAINST ABSTAIN
1. Approval of changes to the fundamental investment restrictions; [_] [_] [_]
[_] To vote against the proposed changes to one or more of the specific
fundamental investment restrictions, but to approve others, PLACE AN
"X" IN THE BOX AT LEFT and indicate the letter(s) (as set forth in
the proxy statement) of the investment restriction or restrictions
you do not want to change on the line on the reverse side. If you
choose to vote differently on individual restrictions, you must mail
in your proxy card. If you choose to vote the same on all
restrictions pertaining to your fund, telephone and Internet voting
are available.
3. Ratification of the selection of PricewaterhouseCoopers LLP as the [_] [_] [_]
</TABLE>
<PAGE>
Fund's Independent Public Accountants.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
- ------------------------------------------------------------------- -----------
Signature Date
- ------------------------------------------------------------------- -----------
Signature (Joint Owners) Date
[Back]
To vote against the proposed changes to one or more of the specific fundamental
investment restrictions, indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote differently on
individual restrictions, you must mail in your proxy card. If you choose to
vote the same on all restrictions pertaining to your fund, telephone and
Internet voting are available.
1. ______________________________
<PAGE>
[Name and Address]
INVESCO PACIFIC BASIN FUND
INVESCO INTERNATIONAL FUNDS, INC.
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Directors of
INVESCO International Funds, Inc. (the "Company") and relates to the proposals
with respect to the Company and to INVESCO Pacific Basin Fund ("Fund"), a series
of International Funds. The undersigned hereby appoints as proxies Fred A.
Deering and Mark H. Williamson, and each of them (with power of substitution),
to vote all shares of common stock of the undersigned in the Fund at the Special
Meeting of Shareholders to be held at 10:00 a.m., Mountain Standard Time, on May
20, 1999, at the offices of the Company, 7800 East Union Avenue, Denver,
Colorado 80237, and any adjournment thereof ("Meeting"), with all the power the
undersigned would have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Company and to the Fund with discretionary
power to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO PACIFIC BASIN FUND
<TABLE>
<S> <C> <C> <C> <C>
Vote on Directors FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
2. Election of the Company's Board of Directors: (1) Charles W. [_] [_] [_] To withhold authority
Brady; (2) Fred A. Deering; (3) Mark H. Williamson; (4) Dr. Victor L. to vote, mark "For
Andrews; (5) Bob R. Baker; (6) Lawrence H. Budner; (7) Dr. Wendy Lee All Except" and write
Gramm; (8) Kenneth T. King; (9) John W. McIntyre; and (10) Dr. Larry the nominee's number
Soll; on the line below.
Vote On Proposals FOR AGAINST ABSTAIN
ALL ALL ALL
1. Approval of changes to the fundamental investment restrictions; [_] [_] [_]
[_] To vote against the proposed changes to one or more of the specific
fundamental investment restrictions, but to approve others, PLACE AN
"X" IN THE BOX AT LEFT and indicate the letter(s) (as set forth in
the proxy statement) of the investment restriction or restrictions
you do not want to change on the line on the reverse side. If you
choose to vote differently on individual restrictions, you must mail
in your proxy card. If you choose to vote the same on all
restrictions pertaining to your fund, telephone and Internet voting
are available
FOR AGAINST ABSTAIN
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
3. Ratification of the selection of PricewaterhouseCoopers LLP as [_] [_] [_]
Pacific Basin Fund's Independent Public Accountants.
</TABLE>
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
- ------------------------------------------------------------------- -----------
Signature Date
- ------------------------------------------------------------------- -----------
Signature (Joint Owners) Date
[Back]
To vote against the proposed changes to one or more of the specific fundamental
investment restrictions, indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote differently on
individual restrictions, you must mail in your proxy card. If you choose to
vote the same on all restrictions pertaining to your fund, telephone and
Internet voting are available.
1. ______________________________
<PAGE>
[Name and Address]
INVESCO INTERNATIONAL BLUE CHIP FUND
INVESCO INTERNATIONAL FUNDS, INC.
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Directors of
INVESCO International Funds, Inc. (the "Company") and relates to the proposals
with respect to International Funds and to INVESCO International Blue Chip Fund
("Fund"), a series of the Company. The undersigned hereby appoints as proxies
Fred A. Deering and Mark H. Williamson, and each of them (with power of
substitution), to vote all shares of common stock of the undersigned in the Fund
at the Special Meeting of Shareholders to be held at 10:00 a.m., Mountain
Standard Time, on May 20, 1999, at the offices of the Company, 7800 East Union
Avenue, Denver, Colorado 80237, and any adjournment thereof ("Meeting"), with
all the power the undersigned would have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Company and to the Fund with discretionary
power to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO INTERNATIONAL BLUE CHIP FUND
<TABLE>
<S> <C> <C> <C> <C>
Vote on Directors FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
3. Election of the Company's Board of Directors: (1) Charles W. [_] [_] [_]
Brady; (2) Fred A. Deering; (3) Mark H. Williamson; (4) Dr. Victor L.
Andrews; (5) Bob R. Baker; (6) Lawrence H. Budner; (7) Dr. Wendy Lee To withhold authority
Gramm; (8) Kenneth T. King; (9) John W. McIntyre; and (10) Dr. Larry to vote, mark "For
Soll; All Except" and
write the nominee's
number on the line
below.
Vote on Proposals FOR AGAINST ABSTAIN
ALL ALL ALL
2. Approval of changes to the fundamental investment restrictions: [_] [_] [_]
To vote against the proposed changes to one or more the
specific fundamental investment restrictions, but to approve
others, PLACE AN "X" IN THE BOX AT left and indicate the
letter(s) (as set forth in the proxy statement) of the
investment restriction or restrictions you do not want to
change on the line on the reverse side. If you choose vote
differently on individual restrictions, you must mail in your
proxy card. If you choose to vote the same on all
restrictions pertaining to your fund, telephone and Internet
voting are available.
FOR AGAINST ABSTAIN
4. Ratification of the selection of PricewaterhouseCoopers LLP as the [_] [_] [_]
</TABLE>
<PAGE>
Fund's Independent Public Accountants.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE, OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
- ------------------------------------------------------------------- -----------
Signature Date
- ------------------------------------------------------------------- -----------
Signature (Joint Owners) Date
[Back]
To vote against the proposed changes to one or more of the
specific fundamental investment restrictions, indicate the
letter(s) (as set forth in the proxy statement) of the
investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote
differently on individual restrictions, you must mail in your
proxy card. If you choose to vote the same on all
restrictions pertaining to your fund, telephone and Internet
voting are available.
2. ____________________________________
<PAGE>
March 23, 1999
Dear Emerging Markets Fund Shareholder:
Enclosed with this letter you will find an important proxy statement for the
upcoming shareholder meeting on May 20. The main reason for this meeting is so
that you and the other investors in INVESCO Emerging Markets Fund can vote on a
proposal by management to liquidate your Fund. It's important to us that you
understand why we are recommending this step - which we believe is in your best
interests as an investor. Here are answers to some questions you may have about
this proposal: Why is INVESCO proposing this liquidation? We value our
relationship with you -- and we won't offer an investment we don't believe
provides you with the potential you deserve. The reasons for the proposal are
explained in more detail in the enclosed proxy statement, but they can be summed
up as investment outlook and cost. We introduced this Fund because we believed
there were significant opportunities around the globe for aggressive investors.
While there are solid values still to be found in emerging economies,
exceptional turbulence in overseas financial markets over the past two years
makes it difficult to justify a mutual fund which invests primarily in those
markets. In addition, because of the limited potential, we have simply been
unable to attract enough shareholders and assets to run this Fund efficiently on
your behalf. Small funds tend to have higher expense ratios, shared by
relatively few investors. It does not make economic sense for either our
shareholders or INVESCO to keep managing Emerging Markets Fund. For the
foreseeable future, the investment risks and costs may simply outweigh the
potential long-term rewards. Aggressive investors may be better served by
choosing international funds which invest only a portion of their assets in
these markets. What happens if shareholders decide in favor of liquidation? If
that happens, the Fund's net assets will be distributed among the remaining
shareholders on the liquidation date following the shareholder meeting. You may
decide your best investment choice is to exchange your shares into another
INVESCO fund on or before that date. You may wish to consult your financial
advisor about this important decision. INVESCO offers numerous aggressive growth
opportunities, including other international funds. For example, to keep some
exposure to emerging markets, you might consider either INVESCO Pacific Basin
Fund or Latin American Growth Fund. To diversify more broadly overseas, take a
look at our new International Blue Chip Fund. Like Emerging Markets Fund, these
funds seek growth overseas. They are subject to the risks all international
investments share, such as currency fluctuations, as well as differences in
securities regulation and accounting. However, these funds also offer
considerable opportunity for strong performance in the coming years. Or, if you
are not ready to make a long-term investment decision, INVESCO Cash Reserves
Fund may be a good place to "park" your cash temporarily. (An investment in this
fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although this fund seeks
to preserve the value of your investment at $1.00 per share, it is possible to
lose money by investing in the fund.) You may obtain more information about your
INVESCO fund choices, including management fees, expenses, and risks, by calling
1-800-646-8372 for a free prospectus, or consult your financial advisor. Please
read the prospectus carefully before you invest or send money. We also encourage
you to visit our Web site for prospectuses and current information about all of
our funds, including performance figures and updates from the portfolio
managers: www.invesco.com. If you are still an investor in Emerging Markets Fund
on the liquidation date, you will automatically receive a check for the value of
the shares which you owned on that date. If the fund liquidates, will there be
tax consequences for me? In order to liquidate, the Fund will sell all of its
holdings. This may result in capital gain distributions to shareholders, which
are usually taxable if your investment is not in a tax-advantaged account (like
an IRA or other retirement plan). In addition, the final price per share of the
Fund may be more or less than you
<PAGE>
originally paid for your shares; if more, then you may have taxable gains there
as well. And, as always, if you exchange into another fund, that is considered a
sale and may have tax consequences. You should consult your own tax advisor
about how a liquidation might affect you, given your personal circumstances.
What does the fund's Board of Directors recommend? The Board believes you should
vote in favor of the liquidation. More important, though, the directors
recommend that you study the issues involved, call us with any questions, and
vote promptly to ensure that a quorum of Emerging Markets Fund shares will be
represented at the shareholders meeting. I hope this has helped you in better
understanding why we are making this proposal. If you have any questions, I
encourage you to call us at 1-800-646-8372, and one of our Investor Specialists
will assist you.
Sincerely,
/s/ MARK H. WILLIAMSON
- -----------------------
Mark H. Williamson
Chairman & CEO, INVESCO Funds
P.S. Remember that you have two decisions to make very soon: How to vote on the
enclosed proxy, and how to invest if the Fund does liquidate. If we can provide
you with any information to make those choices easier, please call us.
