SMITH BARNEY FUNDS, INC.*
Large Cap Value Fund
U.S. Government Securities Fund
SMITH BARNEY SMALL CAP BLEND FUND, INC.**
Supplement dated June 12, 1998
to the Prospectuses dated
*April 28, 1998
**April 30, 1998
The following information supplements, and to the extent inconsistent
therewith, replaces the information contained in the current Prospectuses.
Effective immediately, Class C shares will be renamed Class L shares.
Effective June 15, 1998, Class L shares will be sold at net asset
value per share plus a maximum initial sales charge of 1.00%.
Class L Share Expenses:
The following expense table lists the costs and expenses an investor
will incur either directly or indirectly as a Class L shareholder
of the Portfolios of Smith Barney Funds, Inc. shown below and Smith
Barney Small Cap Blend Fund, Inc. (each, a "Portfolio") based on
the maximum sales charge and maximum contingent deferred sales
charge ("CDSC") that may be incurred at the time of purchase or redemption and
each such Portfolio's operating expenses for its most recent fiscal year:
Large Cap
Value Fund
U.S.
Government
Securities
Small Cap
Blend
Shareholder Transaction Expenses
Maximum sales charge imposed
on purchases (as a percentage of offering price)
1.00%
1.00%
1.00%
Maximum CDSC
(as a percentage of original cost or redemption
proceeds, whichever is lower)
1.00%
1.00%
1.00%
Annual Portfolio Operating Expenses
(as a percentage of average net assets)
Management fees
0.58%
0.45%
0.75%
12b-1 fees+
1.00
0.70
1.00
Other expenses
0.11
0.12
0.25
TOTAL PORTFOLIO OPERATING EXPENSES
1.69%
1.27%
2.00%
EXAMPLE
The following example is intended to assist an investor in understanding
the various costs that an investor in Class L shares of the Portfolios
shown below will bear directly or indirectly. The example assumes
payment by each Portfolio of operating expenses at the levels set forth in the
preceding table. See "Purchase of Shares," "Redemption of Shares" and
"Management of the Fund" in the Prospectus for more information.
Large Cap
Value
U.S.
Government
Securities
Small Cap
Blend
An investor would pay the following expenses
on a $1,000 investment, assuming (1) 5.00%
annual return and (2) redemption at the end of
each time period:
1 year $ 37 $ 33 $ 40
3 years 63 50 72
5 years 101 79 117
10 years 208 162 240
An investor would pay the following expenses
on the same investment, assuming the same
annual return and no redemption:
1 year 27 $ 23 $ 30
3 years 63 50 72
5 years 101 79 117
10 years 208 162 240
The example also provides a means for the investor to compare expense
levels of funds with different fee structures over varying investment
periods. To facilitate such comparison, all funds are required to
utilize a 5.00% annual return assumption. However, each Portfolio's
actual return will vary and may be greater or less than 5.00%. This
example should not be considered a representation of past or future
expenses and actual expenses may be greater or less than those shown.
Purchase of Shares:
Until June 25, 1999 purchases of Class L shares by investors who were
holders of Class C shares of any Smith Barney Mutual Fund
on June 12,1998 will not be subject to the 1% front-end sales charge.
+ Class L shares do not have a conversion feature and, therefore, are
subject to an ongoing distribution fee. As a result, long term
shareholders of Class L shares may pay more than the economic
equivalent of the maximum front-end sales charge permitted
by the National Association of Securities Dealers, Inc.
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