Prospectus
June
28, 2024
Class: A
(RMUNX), C (RMUCX), Y (RMUYX), R6 (IORUX)
Invesco
Rochester®
New York Municipals Fund
As with all
other mutual fund securities, the U.S. Securities and Exchange Commission (SEC)
has not approved or disapproved these securities or passed upon the adequacy of
this prospectus. Any representation to the contrary is a criminal
offense.
An investment
in the Fund:
■
is not FDIC
insured;
■
may lose
value; and
■
is not
guaranteed by a bank.
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Back
Cover |
Invesco
Rochester®
New York Municipals Fund
The Fund’s
investment objective is to seek tax-free income.
This table
describes the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund.
The
table and Examples below do not reflect any transaction fees
that may be charged by financial intermediaries or commissions that a
shareholder may be required to pay directly to its financial intermediary when
buying or selling Class Y or Class R6 shares.
You may
qualify for sales charge discounts if you and your family invest, or agree to
invest in the future, at least $100,000 in the
Invesco Funds. More information about these and other discounts
is available from your financial professional and in the section “Shareholder
Account Information – Initial Sales Charges (Class A Shares Only)” on page A-3
of the prospectus and the section “Purchase, Redemption and Pricing of
Shares-Purchase and Redemption of Shares” on page L-1 of the statement of
additional information (SAI).
|
| ||||
|
Class: |
A |
C |
Y |
R6 |
|
Maximum
Sales Charge (Load) Imposed on Purchases (as a
percentage
of offering price) |
% |
|
|
|
|
| ||||
|
Maximum
Deferred Sales Charge (Load) (as a percentage of
original
purchase price or redemption proceeds, whichever is
less) |
|
% |
|
|
|
| ||||
|
Annual
Fund Operating Expenses
(expenses that you pay each year as a percentage of the
value
of your investment) | ||||
|
Class: |
A |
C |
Y |
R6 |
|
Management
Fees |
% |
% |
% |
% |
|
| ||||
|
Distribution
and/or Service (12b-1) Fees |
|
|
|
|
|
| ||||
|
Other
Expenses |
|
|
|
|
|
| ||||
|
Interest
Expense |
|
|
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|
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|
Total
Other Expenses |
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|
Total
Annual Fund Operating Expenses |
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|
1 |
|
The
Example assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those periods. This
Example does not include commissions and/or other forms of compensation that
investors may pay on transactions in Class Y and Class R6 shares. The Example
also assumes that your investment has a 5% return each year and that the Fund’s
operating expenses remain the same.
Although
your actual costs may be higher or lower, based on these assumptions,
your costs would be:
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
Class
A |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
C |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
Y |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
R6 |
$ |
$ |
$ |
$ |
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
Class
A |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
C |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
Y |
$ |
$ |
$ |
$ |
|
| ||||
|
Class
R6 |
$ |
$ |
$ |
$ |
|
| ||||
Under normal
market conditions, and as a fundamental policy, the Fund invests at least 80% of
its net assets (plus borrowings for investment purposes) in securities the
income from which, in the opinion of counsel to the issuer of each security, is
exempt from regular federal individual and, as applicable, the Fund’s state
income tax. Additionally, under normal market conditions, and as a fundamental
policy, the Fund invests at least 80% of its net assets (plus borrowings for
investment purposes) in New York municipal securities. The policies stated in
the foregoing sentences may not be changed without shareholder approval of a
majority of the Fund’s outstanding voting securities, as defined in the
Investment Company Act of 1940, as amended (1940 Act). In complying with the 80%
investment requirements, the Fund may invest in derivatives and other
instruments that have economic characteristics similar to the Fund’s direct
investments that are counted toward the 80% investment requirements.
As
a fundamental policy, the Fund may invest up to 20% of its net assets in
securities subject to the federal alternative minimum tax (AMT). The Fund
invests mainly in New York municipal securities that pay interest that, in the
opinion of counsel to the issuer of each security, is exempt from federal and
New York personal income taxes. Municipal securities are generally issued by the
state and its political subdivisions (such as cities, towns, counties, agencies
and authorities) and primarily include municipal bonds (long-term (generally
more than one-year) obligations), municipal notes (short-term obligations),
interests in municipal leases and tax-exempt commercial paper. Municipal
securities generally are classified as general or revenue obligations. General
obligations are secured by the issuer’s pledge of its full faith, credit and
taxing power for the payment of principal and interest. Revenue obligations are
bonds whose interest is payable only from the revenues derived from a particular
facility or class of facilities, or a specific excise tax or other revenue
source. The securities in which the Fund invests as part of its 80% policy
related to New York municipal securities may also include those issuers located
outside of New York, such as U.S. territories, commonwealths and possessions or
by their agencies, instrumentalities and authorities, if the interest on such
securities is not subject to New York and federal income tax. These securities
are “New York municipal securities” for purposes of this prospectus.
The
Fund can invest up to 25% of its total assets in below-investment-grade
securities (commonly called “junk bonds”). This restriction is applied at the
time of purchase and the Fund may continue to hold a security whose credit
rating has been downgraded or, in the case of an unrated security, after the
Fund’s Adviser, Invesco Advisers, Inc. (Invesco or the Adviser), has changed its
assessment of the security’s credit quality. As a result, credit rating
downgrades or other market fluctuations may cause the Fund’s holdings of
below-investment grade securities to exceed, at times significantly, this
restriction for an extended period of time. If the Fund has more than 25% of its
total assets invested in
1 Invesco
Rochester®
New York Municipals Fund
below-investment-grade
securities, the Adviser will not purchase additional below-investment-grade
securities until the level of holdings in those securities no longer exceeds the
restriction. Investment-grade securities are:
(i)
securities
rated BBB-
or higher by
S&P Global Ratings (S&P) or Baa3 or higher by Moody's Investors Service,
Inc.
(Moody's)
or an
equivalent rating by another nationally recognized statistical rating
organization (NRSRO), (ii)
securities
with comparable short-term NRSRO ratings, or (iii) unrated securities determined
by the Adviser to be of comparable quality,
each at the
time of purchase. While securities rated BBB+, BBB or BBB-
by
S&P
or
Baa1, Baa2 or
Baa3
by Moody's
are considered investment-grade, they have some speculative characteristics. If
two or more nationally recognized statistical rating organizations have assigned
different ratings to a security, the Adviser uses the highest rating assigned.
The Fund may also invest in unrated securities, in which case the Adviser
internally assigns ratings to those securities, after assessing their credit
quality and other factors, in investment-grade or below-investment grade
categories similar to those of nationally recognized statistical rating
organizations.
To
the extent the Fund invests in pre-refunded municipal securities collateralized
by U.S. government securities, the Fund may treat those securities as
investment-grade (AAA) securities even if the issuer itself has a
below-investment-grade rating.
The
Fund’s investments have no maturity limitations and can include municipal
bonds, municipal notes, and interests in municipal leases and tax-exempt
commercial paper. At times, the Fund may focus on longer-term securities to seek
higher yields. This portfolio strategy is subject to change. The Fund can buy
general obligation bonds and revenue bonds, including “private activity”
municipal securities that pay income subject to alternative minimum taxation.
The Fund may invest a substantial percentage of its assets in “callable”
securities, which may be redeemed by the issuer before their maturity
date.
The
Fund can invest in inverse floating rate interests (Inverse Floaters)
issued in
connection with municipal tender option bond (TOB) financing transactions to
generate leverage for the Fund. The Fund can expose up to 20% of its total
assets to the effects of leverage from its investments in Inverse Floaters. The
Fund's investments in Inverse Floaters are included for purposes of the 80%
policies described above.
The
Fund can invest in derivative instruments, including futures contracts and
swap contracts.
The
Fund can use futures contracts, including interest rate futures, to reduce
exposure to interest rate changes and to manage duration.
The
Fund can use swap contracts, including interest rate swaps, to hedge its
exposure to interest rates. The Fund may not enter into interest rate swaps with
respect to more than 25% of its total assets.
The
Fund can borrow money to purchase additional securities, which is another form
of leverage. Although the amount of borrowing will vary from time to time, the
amount of leveraging from borrowings will not exceed one-third of the Fund’s
total assets. The Fund may also borrow to meet redemption obligations or for
temporary and emergency purposes.
The
Fund can invest up to 20% of its net assets (plus borrowings for investment
purposes) in investments that generate income subject to income taxes. Taxable
investments include many of the types of securities the Fund would buy for
temporary defensive purposes. The Fund does not anticipate investing substantial
amounts of its assets in taxable investments under normal market conditions or
as part of its normal trading strategies and policies.
The
Fund may invest more than 25% of its net assets in a segment of the municipal
securities market with similar characteristics if the Adviser determines that
the yields available from obligations in a particular segment justify the
additional risks of a larger investment in such segment. The Fund may not,
however, invest more than 25% of its net assets in industrial development
revenue bonds issued for companies in the same industry.
The
Fund can invest up to 25% of its total assets in tobacco settlement revenue bonds
and up to 25% of its total assets in tobacco-related bonds
without an
appropriation pledge that make payments only from a state’s interest in the
Master Settlement Agreement (MSA).
The
Fund can invest in reverse repurchase agreements.
The
Fund may invest in securities that are subject to resale restrictions
such as those
contained in Rule 144A promulgated under the Securities Act of 1933, as amended.
The Fund’s investments may include securities that do not produce immediate cash
income, such as zero coupon securities and payment-in-kind securities. Zero
coupon securities are debt securities that do not entitle the holder to any
periodic payment of interest prior to maturity or a specified date when the
securities begin paying current interest. Payment-in-kind securities are debt
securities that pay interest through the issuance of additional
securities.
Decisions
to purchase or sell securities are determined by the relative value
considerations of the portfolio managers that factor in economic and
credit-related fundamentals, market supply and demand, market dislocations and
situation-specific opportunities. The purchase or sale of securities may be
related to a decision to alter the Fund's macro risk exposure (such as duration,
yield curve positioning and sector exposure), a need to limit or reduce the
Fund's exposure to a particular security or issuer, degradation of an issuer's
credit quality, or general liquidity needs of the Fund. The potential for
realization of capital gains or losses resulting from possible changes in
interest rates will not be a major consideration and frequency of portfolio
turnover generally will not be a limiting factor if the Adviser considers it
advantageous to purchase or sell securities.
These
factors may change over time and may vary in particular cases. The portfolio
managers may consider selling a security if any of these factors no longer
applies to a security purchased for the Fund, but are not required to do
so.
Principal
Risks of Investing in the Fund
As with any
mutual fund investment, loss of money is a risk of investing. An
investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. The risks associated with an investment in
the Fund can increase during times of significant market volatility. The
principal risks of investing in the Fund are:
2 Invesco
Rochester®
New York Municipals Fund
3 Invesco
Rochester®
New York Municipals Fund
4 Invesco
Rochester®
New York Municipals Fund
The
returns shown for periods ending on or prior to May 24, 2019 are
those of the
Class A, Class C and Class Y shares of the predecessor fund.
Class A, Class C and Class Y shares of the predecessor fund were
reorganized into Class A, Class C and Class Y shares,
respectively, of the Fund after the close of business on May 24, 2019.
Class A, Class C and Class Y shares’ returns of the Fund will be
different from the returns of the predecessor fund as they have different
expenses. Performance for Class A shares has been restated to reflect the
Fund’s applicable sales charge.
Fund
performance reflects any applicable fee waivers and expense reimbursements.
Performance returns would be lower without applicable fee waivers and expense
reimbursements.
All
Fund performance shown assumes the reinvestment of dividends and capital
gains and the effect of the Fund’s expenses.
Updated
performance information is available on the Fund's website at www.invesco.com/us .
Annual Total Returns
|
Class
A |
Period
Ended |
Returns |
|
|
|
|
|
|
|
|
|
|
|
- |
Average Annual Total Returns (for the periods ended December 31, 2023)
|
|
Inception
Date |
1
Year |
5
Years |
10
Years |
|
Class
A |
|
|
|
|
|
Return
Before Taxes |
|
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
|
Return
After Taxes on Distributions and Sale of Fund
Shares |
|
|
|
|
|
| ||||
|
Class
C |
|
|
|
|
|
| ||||
|
Class
Y |
|
|
|
|
|
| ||||
|
Class
R6 |
|
|
1 |
1 |
|
| ||||
|
S&P
Municipal Bond New York 5+ Year Investment
Grade
Index expenses
or taxes) |
|
|
|
|
|
| ||||
|
U.S.
Consumer Price Index (reflects no deduction for
fees,
expenses or taxes)2 |
|
|
|
|
|
| ||||
|
S&P
Municipal Bond Index (reflects no deduction for
fees,
expenses or taxes)2
|
|
|
|
|
|
| ||||
1
2
Management
of the Fund
Investment
Adviser: Invesco Advisers, Inc. (Invesco or the Adviser)
|
Portfolio
Managers |
Title |
Length
of Service on the Fund |
Mark
Paris |
Portfolio
Manager |
2019 |
|
| ||
Joshua
Cooney |
Portfolio
Manager |
2024 |
|
| ||
Elizabeth
S. Mossow, CFA |
Portfolio
Manager |
2024 |
|
| ||
Tim
O'Reilly |
Portfolio
Manager |
2020 |
|
| ||
Julius
Williams |
Portfolio
Manager |
2020 |
|
| ||
Purchase
and Sale of Fund Shares
You may
purchase, redeem or exchange shares of the Fund on any business day through your
financial adviser or by telephone at 800-959-4246. Shares of the Fund, other
than Class R6 shares, may also be purchased, redeemed or exchanged on any
business day through our website at www.invesco.com/us or by mail to Invesco
Investment Services, Inc., P.O. Box 219078, Kansas City, MO
64121-9078.
5 Invesco
Rochester®
New York Municipals Fund
The
minimum investments for Class A, C and Y shares for fund accounts are
as follows:
|
Type
of Account |
Initial
Investment
Per
Fund |
Additional
Investments
Per
Fund |
|
Asset
or fee-based accounts managed by your financial
adviser |
None |
None |
|
| ||
|
Employer
Sponsored Retirement and Benefit Plans and
Employer
Sponsored IRAs |
None |
None |
|
| ||
|
IRAs
and Coverdell ESAs if the new investor is purchasing
shares
through a systematic purchase plan |
$25 |
$25 |
|
| ||
|
All
other types of accounts if the investor is purchasing shares
through
a systematic purchase plan |
50 |
50 |
|
| ||
|
IRAs
and Coverdell ESAs |
250 |
25 |
|
| ||
|
All
other accounts |
1,000 |
50 |
|
| ||
With
respect to Class R6 shares, there is no minimum initial investment for Employer
Sponsored Retirement and Benefit Plans investing through a retirement platform
that administers at least $2.5 billion in retirement plan assets. All other
Employer Sponsored Retirement and Benefit Plans must meet a minimum initial
investment of at least $1 million in each Fund in which it invests.
For
all other institutional investors purchasing Class R6 shares, the minimum
initial investment is $1 million, unless such investment is made by (i) an
investment company, as defined under the Investment Company Act of 1940, as
amended (1940 Act), that is part of a family of investment companies which own
in the aggregate at least $100 million in securities, or (ii) an account
established with a 529 college savings plan managed by Invesco, in which case
there is no minimum initial investment.
There
are no minimum investment amounts for Class R6 shares held through
retail omnibus accounts maintained by an intermediary, such as a broker, that
(i) generally charges an asset-based fee or commission in addition to those
described in this prospectus, and (ii) maintains Class R6 shares and makes them
available to retail investors.
Tax
Information
The Fund’s
distributions primarily are exempt from regular federal income tax and New York
state and New York city income taxes for residents of New York. All or a portion
of these distributions, however, may be subject to the federal alternative
minimum tax. The Fund may also make distributions that are taxable to you as
ordinary income or capital gains.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase the Fund through a broker-dealer or other financial intermediary (such
as a bank), the Fund, the Fund’s distributor or its related companies may pay
the intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson or financial adviser to recommend the
Fund over another investment. Ask your salesperson or financial adviser or visit
your financial intermediary’s website for more information.
Investment Objective(s), Strategies, Risks and Portfolio Holdings
Objective(s)
and Strategies
The Fund’s
investment objective is to seek tax-free income. The Fund’s investment objective
may be changed by the Board of Trustees (the Board) without shareholder
approval.
Under
normal market conditions, and as a fundamental policy, the Fund invests at
least 80% of its net assets (plus borrowings for investment purposes) in
securities the income from which, in the opinion of counsel to the issuer of
each security, is exempt from regular federal individual and, as applicable, the
Fund’s state income tax. Additionally, under normal market
conditions,
and as a fundamental policy, the Fund invests at least 80% of its net assets
(plus borrowings for investment purposes) in New York municipal securities. The
policies stated in the foregoing sentences may not be changed without
shareholder approval of a majority of the Fund’s outstanding voting securities,
as defined in the Investment Company Act of 1940, as amended (1940 Act). In
complying with the 80% investment requirements, the Fund may invest in
derivatives and other instruments that have economic characteristics similar to
the Fund’s direct investments that are counted toward the 80% investment
requirements.
As
a fundamental policy, the Fund may invest up to 20% of its net assets in
securities subject to the federal alternative minimum tax (AMT). The Fund
invests mainly in New York municipal securities that pay interest that, in the
opinion of counsel to the issuer of each security, is exempt from federal and
New York personal income taxes. Municipal securities are generally issued by the
state and its political subdivisions (such as cities, towns, counties, agencies
and authorities) and primarily include municipal bonds (long-term (generally
more than one-year) obligations), municipal notes (short-term obligations),
interests in municipal leases and tax-exempt commercial paper. Municipal
securities generally are classified as general or revenue obligations. General
obligations are secured by the issuer’s pledge of its full faith, credit and
taxing power for the payment of principal and interest. Revenue obligations are
bonds whose interest is payable only from the revenues derived from a particular
facility or class of facilities, or a specific excise tax or other revenue
source. The securities in which the Fund invests as part of its 80% policy
related to New York municipal securities may also include those issuers located
outside of New York, such as U.S. territories, commonwealths and possessions or
by their agencies, instrumentalities and authorities, if the interest on such
securities is not subject to New York and federal income tax. These securities
are “New York municipal securities” for purposes of this prospectus.
The
Fund focuses its investments in the state of New York. The Fund will
therefore be
vulnerable to the effects of economic, regulatory and political developments
that affect New York’s governmental issuers.
The
Fund can invest up to 25% of its total assets in below-investment-grade
securities (commonly called “junk bonds”). This restriction is applied at the
time of purchase and the Fund may continue to hold a security whose credit
rating has been downgraded or, in the case of an unrated security, after the
Fund’s Adviser, Invesco Advisers, Inc. (Invesco or the Adviser), has changed its
assessment of the security’s credit quality. As a result, credit rating
downgrades or other market fluctuations may cause the Fund’s holdings of
below-investment grade securities to exceed, at times significantly, this
restriction for an extended period of time. If the Fund has more than 25% of its
total assets invested in below-investment-grade securities, the Adviser will not
purchase additional below-investment-grade securities until the level of
holdings in those securities no longer exceeds the restriction. Investment-grade
securities are:
(i)
securities
rated BBB-
or higher by
S&P Global Ratings (S&P) or Baa3 or higher by Moody's Investors Service,
Inc.
(Moody's)
or an
equivalent rating by another nationally recognized statistical rating
organization (NRSRO), (ii)
securities
with comparable short-term NRSRO ratings, or (iii) unrated securities determined
by the Adviser to be of comparable quality,
each at the
time of purchase. While securities rated BBB+, BBB or BBB-
by
S&P
or
Baa1, Baa2 or
Baa3
by Moody's
are considered investment-grade, they have some speculative characteristics. If
two or more nationally recognized statistical rating organizations have assigned
different ratings to a security, the Adviser uses the highest rating assigned.
The Fund may also invest in unrated securities, in which case the Adviser
internally assigns ratings to those securities, after assessing their credit
quality and other factors, in investment-grade or below-investment grade
categories similar to those of nationally recognized statistical rating
organizations.
To
the extent the Fund invests in pre-refunded municipal securities collateralized
by U.S. government securities, the Fund may treat those securities as
investment-grade (AAA) securities even if the issuer itself has a
below-investment-grade rating.
6 Invesco
Rochester®
New York Municipals Fund
The
Fund’s investments have no maturity limitations and can include municipal
bonds, municipal notes, and interests in municipal leases and tax-exempt
commercial paper. At times, the Fund may focus on longer-term securities to seek
higher yields. This portfolio strategy is subject to change. The Fund can buy
general obligation bonds and revenue bonds, including “private activity”
municipal securities that pay income subject to alternative minimum taxation.
The Fund may invest a substantial percentage of its assets in “callable”
securities, which may be redeemed by the issuer before their maturity
date.
The
Fund can invest in inverse floating rate interests (Inverse Floaters)
issued in
connection with municipal tender option bond (TOB) financing transactions to
generate leverage for the Fund. The Fund's investments in Inverse Floaters are
included for purposes of the 80% policies described above.
Inverse
Floaters are issued in connection with TOB financing transactions
to generate leverage for the Fund. Such instruments are created by a special
purpose trust (a TOB Trust) that holds long-term fixed rate bonds sold to it by
the Fund (the underlying security), and issues two classes of beneficial
interests: short-term floating rate interests (Floaters) with a fixed principal
amount that represent a senior interest in the underlying security and which are
sold to other investors, and Inverse Floaters that represent a residual,
subordinate interest in the underlying security and which are purchased by the
Fund. The Floaters have first priority on the cash flow from the underlying
security held by the TOB Trust, have a tender option feature that allows holders
to tender the Floaters back to the TOB Trust for their par amount and accrued
interest at specified intervals and bear interest at prevailing short-term
interest rates. Tendered Floaters are remarketed for sale to other investors for
their par amount and accrued interest by a remarketing agent to the TOB Trust
and are ultimately supported by a liquidity facility provided by a bank, upon
which the TOB Trust can draw funds to pay such amount to holders of Tendered
Floaters that cannot be remarketed. The Fund, as holder of the Inverse Floaters,
is paid the residual cash flow from the underlying security. Accordingly, the
Inverse Floaters provide the Fund with leveraged exposure to the underlying
security. When short-term interest rates rise or fall, the interest payable on
the Floaters issued by a TOB Trust will, respectively, rise or fall, leaving
less or more, respectively, residual interest cash flow from the underlying
security available for payment on the Inverse Floaters. Thus, as short-term
interest rates rise, Inverse Floaters produce less income for the Fund, and as
short-term interest rates decline, Inverse Floaters produce more income for the
Fund. The price of Inverse Floaters is expected to decline when interest rates
rise and increase when interest rates decline; in either case, generally more so
than the price of a bond with a similar maturity, because of the effect of
leverage.
The
Fund can invest in derivative instruments, including futures contracts and
swap contracts.
The
Fund can use futures contracts, including interest rate futures, to reduce
exposure to interest rate changes and to manage duration.
A
futures contract is a standardized agreement between two parties to buy or sell a
specified quantity of an underlying asset at a specified price at a specified
future time. The value of the futures contract tends to increase and decrease in
tandem with the value of the underlying asset. Futures contracts are bilateral
agreements, with both the purchaser and the seller equally obligated to complete
the transaction. Depending on the terms of the particular contract, futures
contracts are settled by purchasing an offsetting contract, physically
delivering the underlying asset on the settlement date or paying a cash
settlement amount on the settlement date.
The
Fund can use swap contracts, including interest rate swaps, to hedge its
exposure to interest rates. The Fund may not enter into interest rate swaps with
respect to more than 25% of its total assets.
A
swap contract is an agreement between two parties pursuant to which the
parties exchange payments at specified dates on the basis of a
specified notional amount, with the payments calculated by reference to
specified securities, indexes, reference rates, commodities, currencies or
other assets.
The notional amount of a swap is based on the nominal or face amount of a
reference asset that is used to calculate payments made on that swap; the
notional amount typically is not exchanged between counterparties. The parties
to the swap use variations in the value of the underlying asset to calculate
payments between them through the life of the swap.
The
Fund can borrow from banks, a technique referred to as “leverage,” in amounts up
to one-third of the Fund's total assets (including the amount borrowed) less all
liabilities and indebtedness other than borrowings. The Fund can use those
borrowings for investment-related purposes such as purchasing securities
believed to be desirable by the Adviser when available or funding amounts
necessary to unwind or “collapse” TOB Trusts that issued Inverse Floaters to the
Fund (an investment vehicle used by the Fund as described in this prospectus).
The Fund may also borrow to meet redemption obligations or for temporary and
emergency purposes. The Fund currently participates in a line of credit with
certain other Invesco Funds for its borrowing. The Fund may invest in derivative
instruments, including interest rate swaps, to hedge its exposure to interest
rates. The Fund may not enter into interest rate swaps with respect to more than
25% of its total assets.
The
Fund can invest up to 20% of its net assets (plus borrowings for investment
purposes) in investments that generate income subject to income taxes. Taxable
investments include many of the types of securities the Fund would buy for
temporary defensive purposes. The Fund does not anticipate investing substantial
amounts of its assets in taxable investments under normal market conditions or
as part of its normal trading strategies and policies.
The
Fund may invest more than 25% of its net assets in a segment of the municipal
securities market with similar characteristics if the Adviser determines that
the yields available from obligations in a particular segment justify the
additional risks of a larger investment in such segment. The Fund may not,
however, invest more than 25% of its net assets in industrial development
revenue bonds issued for companies in the same industry.
The
Fund can invest more than 25% of its total assets in municipal securities
for similar types of projects that are issued in connection with special taxing
districts that are organized to plan and finance infrastructure development to
induce residential, commercial and industrial growth and
redevelopment.
The
Fund can invest up to 25% of its total assets in tobacco settlement revenue bonds
and up to 25% of its total assets in tobacco-related bonds without an
appropriation pledge that make payments only from a state’s interest in the
Master Settlement Agreement (MSA).
The
Fund can invest in reverse repurchase agreements.
The
Fund may invest in securities that are subject to resale restrictions
such as those
contained in Rule 144A promulgated under the Securities Act of 1933, as amended.
The Fund’s investments may include securities that do not produce immediate cash
income, such as zero coupon securities and payment-in-kind securities. Zero
coupon securities are debt securities that do not entitle the holder to any
periodic payment of interest prior to maturity or a specified date when the
securities begin paying current interest. Payment-in-kind securities are debt
securities that pay interest through the issuance of additional
securities.
Decisions
to purchase or sell securities are determined by the relative value
considerations of the portfolio managers that factor in economic and
credit-related fundamentals, market supply and demand, market dislocations and
situation-specific opportunities. The purchase or sale of securities may be
related to a decision to alter the Fund's macro risk exposure (such as duration,
yield curve positioning and sector exposure), a need to limit or reduce the
Fund's exposure to a particular security or issuer, degradation of an issuer's
credit quality, or general liquidity needs of the Fund. The potential for
realization of capital gains or losses resulting from possible changes in
interest rates will not be a major consideration and frequency of portfolio
turnover generally will not be a limiting factor if the Adviser considers it
advantageous to purchase or sell securities.
7 Invesco
Rochester®
New York Municipals Fund
These
factors may change over time and may vary in particular cases. The portfolio
managers may consider selling a security if any of these factors no longer
applies to a security purchased for the Fund, but are not required to do
so.
In
anticipation of or in response to market, economic, political, or other
conditions,
the Fund’s portfolio managers may temporarily use a different investment
strategy for defensive purposes. If the Fund’s portfolio managers do so,
different factors could affect the Fund’s performance and the Fund may not
achieve its investment objective.
The
Fund’s investments in the types of securities and other investments described in
this prospectus vary from time to time, and, at any time, the Fund may not be
invested in all of the types of securities and other investments described in
this prospectus. The Fund may also invest in securities and other investments
not described in this prospectus.
For
more information, see “Description of the Funds and Their Investments
and Risks” in the Fund’s SAI.
Risks
The principal
risks of investing in the Fund are:
Market
Risk. The market
values of the Fund’s investments, and therefore the value of the Fund’s shares,
will go up and down, sometimes rapidly or unpredictably. Market risk may affect
a single issuer, industry or section of the economy, or it may affect the market
as a whole. The value of the Fund’s investments may go up or down due to general
market conditions that are not specifically related to the particular issuer,
such as real or perceived adverse economic conditions, changes in the general
outlook for revenues or corporate earnings, changes in interest or currency
rates, regional or global instability, or adverse investor sentiment generally.
The value of the Fund’s investments may also go up or down due to factors that
affect an individual issuer or a particular industry or sector, such as changes
in production costs and competitive conditions within an industry. In addition,
natural or environmental disasters, widespread disease or other public health
issues, war, military conflict, acts of terrorism, economic crisis or other
events may have a significant impact on the value of the Fund’s investments, as
well as the financial markets and global economy generally. Such circumstances
may also impact the ability of the Adviser to effectively implement the Fund’s
investment strategy. During a general downturn in the financial markets,
multiple asset classes may decline in value. When markets perform well, there
can be no assurance that specific investments held by the Fund will rise in
value.
■
Market
Disruption Risks Related to Armed Conflict. As a result
of increasingly interconnected global economies
and financial
markets, armed conflict between countries or in a geographic region, for example
the current conflicts
between
Russia
and Ukraine
in Europe
and Hamas and
Israel in the
Middle
East,
has
the potential
to adversely impact the Fund’s investments. Such conflicts, and other
corresponding events, have had, and could continue to have, severe negative
effects on regional and global economic and financial markets, including
increased volatility, reduced liquidity, and overall uncertainty. The negative
impacts may be particularly acute in certain sectors.
The
timing and
duration of such conflicts, resulting sanctions, related events and other
implications cannot be predicted. The foregoing may result in a negative impact
on Fund performance and the value of an investment in the Fund, even beyond any
direct investment exposure the Fund may have to issuers located in or with
significant exposure to an impacted country or geographic
regions.
Debt
Securities Risk. The prices
of debt securities held by the Fund will be affected by changes in interest
rates, the creditworthiness of the issuer and other factors. An increase in
prevailing interest rates typically causes the value of existing debt securities
to fall and often has a greater impact on longer-duration debt securities and
higher quality debt securities. Falling interest rates will cause the Fund to
reinvest the proceeds of debt securities that have been repaid by the issuer at
lower interest rates. Falling interest rates may also reduce the Fund’s
distributable income because
interest
payments on floating rate debt instruments held by the Fund will decline. The
Fund could lose money on investments in debt securities if the issuer or
borrower fails to meet its obligations to make interest payments and/or to repay
principal in a timely manner. If an issuer seeks to restructure the terms of its
borrowings or the Fund is required to seek recovery upon a default in the
payment of interest or the repayment of principal, the Fund may incur additional
expenses. Changes in an issuer’s financial strength, the market’s perception of
such strength or in the credit rating of the issuer or the security may affect
the value of debt securities. The credit analysis applied to the Fund’s debt
securities may fail to anticipate such changes, which could result in buying a
debt security at an inopportune time or failing to sell a debt security in
advance of a price decline or other credit event.
Municipal
Securities Risk. The risk of
a municipal obligation generally depends on the financial and credit status of
the issuer. Constitutional amendments, legislative enactments, executive orders,
administrative regulations, voter initiatives, and the issuer’s regional
economic conditions may affect the municipal security’s value, interest
payments, repayment of principal and the Fund’s ability to sell the security.
Municipal obligations may be more susceptible to downgrades or defaults during
recessions or similar periods of economic stress. Municipal securities
structured as revenue bonds are generally not backed by the taxing power of the
issuing municipality but rather the revenue from the particular project or
entity for which the bonds were issued. If the Internal Revenue Service
determines that an issuer of a municipal security has not complied with
applicable tax requirements, interest from the security could be treated as
taxable, which could result in a decline in the security’s value. In addition,
there could be changes in applicable tax laws or tax treatments that reduce or
eliminate the current federal income tax exemption on municipal securities or
otherwise adversely affect the current federal or state tax status of municipal
securities.
New
York Municipal
Securities Risk. The Fund is
more susceptible to political, economic, regulatory or other factors affecting
issuers of New York municipal securities than a fund which does not focus its
investments in such issuers. These risks include possible legislative, state
constitutional or regulatory amendments that may affect the ability of state and
local governments or regional governmental authorities to raise money to pay
principal and interest on their municipal securities. Economic, fiscal and
budgetary conditions throughout the state may also influence the Fund’s
performance. Events in New York may affect the Fund’s investments and
performance. More detailed information concerning New York municipal securities
and the State of New York is set forth in the SAI.
Municipal
Issuer Focus Risk. The
municipal issuers in which the Fund invests may be located in the same
geographic area or may pay their interest obligations from revenue of similar
projects, such as hospitals, airports, utility systems and housing finance
agencies. This may make the Fund’s investments more susceptible to similar
social, economic, political or regulatory occurrences, making the Fund more
susceptible to experience a drop in its share price than if the Fund had been
more diversified across issuers that did not have similar characteristics. From
time to time, the Fund’s investments may include securities that alone or
together with securities held by other funds or accounts managed by the Adviser,
represents a major portion or all of an issue of municipal securities. Because
there may be relatively few potential purchasers for such investments and, in
some cases, there may be contractual restrictions on resales, the Fund may find
it more difficult to sell such securities at a desirable time or
price.
Investing
in U.S. Territories, Commonwealths and Possessions
Risk. The Fund
also invests in obligations of the governments of U.S. territories,
commonwealths and possessions such as Puerto Rico, the U.S. Virgin Islands, Guam
and the Northern Mariana Islands to the extent such obligations are exempt from
regular federal individual and state income taxes. These investments also are
considered to be “New York municipal securities” for purposes of this
prospectus. Accordingly, the Fund may be adversely affected by local political,
economic, social and
8 Invesco
Rochester®
New York Municipals Fund
environmental
conditions and developments, including natural disasters, within these U.S.
territories, commonwealths and possessions affecting the issuers of such
obligations. A discussion of the special considerations relating to the Fund’s
municipal obligations and other factors or economic conditions in those
territories, commonwealths or possessions is provided in an appendix to the
SAI.
The
Adviser expects the Fund to remain invested in municipal securities issued by
Puerto Rico, its agencies and instrumentalities, subject to market, economic and
political conditions. For the past several years, Puerto Rico has faced and
continues to face significant fiscal challenges, including persistent government
deficits, underfunded public pension benefit obligations, underfunded government
retirement systems, sizable debt service obligations and a high unemployment
rate. The amount of its outstanding public debt will make it very difficult for
Puerto Rico to make full repayment. Certain issuers of Puerto Rico municipal
securities have filed for bankruptcy and/or failed to make payments on
obligations that have come due. As a result of Puerto Rico’s challenging
economic and fiscal environment, certain securities issued by Puerto Rico and
its agencies are currently considered below-investment-grade securities. If the
economic situation in Puerto Rico persists or worsens, the volatility,
liquidity, credit quality and performance of the Fund could be adversely
affected. The outcome of the debt restructuring of certain Puerto Rican issuers
in which the Fund invests, both within and outside bankruptcy proceedings is
uncertain, and could adversely affect the Fund.
The
Schedule of Investments included in the Fund's annual and semi-annual
reports and in Form N-CSR identifies the percentage of the Fund invested in
Puerto Rican municipal securities, as of the reporting date, which may be
substantial.
Tobacco
Related Bonds Risk. The Fund may
invest in tobacco settlement revenue bonds
and tobacco
bonds subject to a state’s appropriation pledge
(STA Tobacco
Bonds).
■
Tobacco
Settlement Revenue Bonds Risk. Tobacco
settlement revenue bonds are secured by payments made under the MSA, which
provides for annual payments by participating tobacco manufacturers to the
states and other jurisdictions in perpetuity. A number of states and local
governments have securitized the future flow of those payments by selling
bonds
backed by the
future revenue flows from the tobacco manufacturers. Annual payments on the
bonds, and thus the risk to the Fund, are dependent on the receipt of future
settlement payments by the state or its instrumentality. The actual amount of
future settlement payments is dependent on many factors including, but not
limited to, annual domestic cigarette shipments, cigarette consumption,
inflation and the financial capability of participating tobacco companies.
Accordingly, payments made by tobacco manufacturers could be reduced if there is
a significant decrease in tobacco consumption,
which could
be a result of,
among other
things, increased regulation or restrictions on cigarette sales or smoking,
anti-smoking campaigns, tax increases, price increases or increased competition
from other nicotine delivery devices. A market share loss by the MSA companies
to non-MSA participating tobacco manufacturers or issues affecting a tobacco
manufacturer,
such as
bankruptcy,
could
also cause a
reduction or delay in bond payments, which could affect the Fund’s net asset
value. Because tobacco settlement revenue bonds are backed by payments from the
tobacco manufacturers, and generally not by the credit of the state or local
government issuing the bonds, their creditworthiness depends on the ability of
tobacco manufacturers to meet their obligations. The MSA and tobacco
manufacturers have been and continue to be subject to various legal claims and
an adverse outcome could affect the payment streams associated with the MSA or
cause delays or reductions in bond payments. The SAI contains more information
about litigation related to the tobacco industry and the MSA.
■
“Subject
to Appropriation”
(STA)
Tobacco
Bonds Risk. STA Tobacco
Bonds rely on both the revenue from the MSA and a state
appropriation
pledge.
“Government
appropriation” or “subject to appropriation” bonds (or “appropriation
debt”)
are typically
payable from two distinct sources:
(i) a
dedicated revenue source (in the case of tobacco bonds, the MSA funds), and (ii)
the issuer’s general funds. Appropriation debt differs from a state’s general
obligation debt in that general obligation debt is backed by the state’s full
faith, credit and taxing power, while appropriation debt requires the state to
pass a specific periodic appropriation to pay interest and/or principal on the
bonds,
which is
usually made annually. While STA Tobacco Bonds offer an enhanced credit support
feature, that feature is generally not an unconditional guarantee of payment by
a state and states generally do not pledge the full faith, credit or taxing
power of the state.
Municipal
Lease Obligations Risk. Municipal
lease obligations are used by state and local governments to obtain funds to
acquire land, equipment or facilities. The Fund can invest in certificates of
participation that represent a proportionate interest in payments made under
municipal lease obligations. Most municipal lease obligations, while secured by
the leased property, are not general obligations of the issuing municipality.
They often contain “non-appropriation” clauses under which the municipal
government has no obligation to make lease or installment payments in future
years unless money is appropriated on a yearly basis.
If
the municipal government stops making payments or transfers its payment
obligations to a private entity, the obligation could lose value or become
taxable. Although the obligation may be secured by the leased equipment or
facilities, the disposition of the property in the event of non-appropriation or
foreclosure might prove difficult, time consuming and costly, and may result in
a delay in recovering or the failure to recover the original investment. Some
lease obligations may not have an active trading market, making it difficult for
the Fund to sell them quickly at an acceptable price.
Land-Secured
or “Dirt” Bonds Risk.
Land-secured or dirt bonds are municipal securities for similar types of
projects that are issued in connection with special taxing districts that are
organized to plan and finance infrastructure development to induce residential,
commercial and industrial growth and redevelopment. The bonds financed by these
methods, such as tax assessment, special tax or tax increment financing
generally are payable solely from taxes or other revenues attributable to the
specific projects financed by the bonds without recourse to the credit or taxing
power of related or overlapping municipalities. These projects often are exposed
to real estate development-related risks, such as the failure of property
development, availability of financing, extended vacancies of properties,
increased competition, limitations on rents, changes in neighborhood values and
the demand of properties to tenants, and changes in interest rates. These real
estate risks may be heightened in the event that these projects are in
foreclosure. Additionally, upon foreclosure the Fund may pay certain maintenance
or operating expenses or taxes relating to such projects. These expenses may
increase the overall expenses of the Fund and reduce its returns.
In
addition, these projects can have more taxpayer concentration risk than general
tax-supported bonds, such as general obligation bonds. Further, the fees,
special taxes, or tax allocations and other revenues that are established to
secure such financings generally are limited as to the rate or amount that may
be levied or assessed and are not subject to increase pursuant to rate covenants
or municipal or corporate guarantees. The bonds could default if development
failed to progress as anticipated or if larger taxpayers failed to pay the
assessments, fees and taxes as provided in the financing plans of the
projects.
Tax-Exempt
Commercial Paper Risk. Tax-exempt
commercial paper is a short-term obligation with a stated maturity of usually
270 days or less. It is issued by state and local governments or their agencies
to finance seasonal working capital needs or as short-term financing in
anticipation of longer-term financing. While tax-exempt commercial paper is
intended to be repaid from general revenues or refinanced, it frequently is
9 Invesco
Rochester®
New York Municipals Fund
backed by a
letter of credit, lending arrangement, note, repurchase agreement or other
credit facility agreement offered by a bank or financial institution. Because
tax-exempt issuers may constantly reissue their commercial paper and use the
proceeds (or other sources) to repay maturing paper, the commercial paper of a
tax-exempt issuer that is unable to continue to obtain liquidity in that manner
may default. There may be a limited secondary market for issues of tax-exempt
commercial paper.
Unrated
Securities Risk. The
investment adviser may internally assign ratings to securities that are not
rated by any nationally recognized statistical rating organization, after
assessing their credit quality and other factors, in categories similar to those
of nationally recognized statistical rating organizations. There can be no
assurance, nor is it intended, that the investment adviser’s credit analysis
process is consistent or comparable with the credit analysis process used by a
nationally recognized statistical rating organization. Unrated securities are
considered “investment-grade” or “below-investment-grade” if judged by the
investment adviser to be comparable to rated investment-grade or
below-investment-grade securities. The investment adviser’s rating does not
constitute a guarantee of the credit quality. In addition, some unrated
securities may not have an active trading market or may trade less actively than
rated securities, which means that the Fund might have difficulty selling them
promptly at an acceptable price.
In
evaluating the credit quality of a particular security, whether rated or
unrated, the
investment adviser will normally take into consideration a number of factors
such as, if applicable, the financial resources of the issuer, the underlying
source of funds for debt service on a security, the issuer’s sensitivity to
economic conditions and trends, any operating history of the facility financed
by the obligation, the degree of community support for the financed facility,
the capabilities of the issuer’s management, and regulatory factors affecting
the issuer or the particular facility.
A
reduction in the rating of a security after the Fund buys it will not
require the
Fund to dispose of the security. However, the investment adviser will evaluate
such downgraded securities to determine whether to keep them in the Fund’s
portfolio.
High
Yield Debt Securities (Junk Bond/Below-Investment
Grade) Risk. The Fund’s
investments in high yield debt securities (commonly referred to as junk bonds)
and other lower-rated securities will subject the Fund to substantial risk of
loss. These securities are considered to be speculative with respect to the
issuer’s ability to pay interest and principal when due and are more susceptible
to default or decline in market value due to adverse economic, regulatory,
political or company developments than higher rated or investment grade
securities. Prices of high yield debt securities tend to be very volatile. These
securities are less liquid than investment grade debt securities and may be
difficult to sell at a desirable time or price, particularly in times of
negative sentiment toward high yield securities.
Inverse
Floating Rate Interests Risk. Inverse
floating rate interests (Inverse Floaters) are issued in connection with
municipal tender option bond (TOB) financing transactions to generate leverage
for the Fund. Such instruments are created by a special purpose trust (a TOB
Trust) that holds long-term fixed rate bonds, sold to it by the Fund (the
underlying security), and issues two classes of beneficial interests: short-term
floating rate interests (Floaters), which are sold to other investors, and
Inverse Floaters, which are purchased by the Fund. The Floaters have first
priority on the cash flow from the underlying security held by the TOB Trust,
have a tender option feature that allows holders to tender the Floaters back to
the TOB Trust for their par amount and accrued interest at specified intervals
and bear interest at prevailing short-term interest rates. Tendered Floaters are
remarketed for sale to other investors for their par amount and accrued interest
by a remarketing agent to the TOB Trust and are ultimately supported by a
liquidity facility provided by a bank, upon which the TOB Trust can draw funds
to pay such amount to holders of Tendered Floaters that cannot be remarketed.
The Fund, as holder of the Inverse Floaters, is paid the residual cash flow from
the underlying security. Accordingly, the
Inverse
Floaters provide the Fund with leveraged exposure to the underlying security.
When short-term interest rates rise or fall, the interest payable on the
Floaters issued by a TOB Trust will, respectively, rise or fall, leaving less or
more, respectively, residual interest cash flow from the underlying security
available for payment on the Inverse Floaters. Thus, as short-term interest
rates rise, Inverse Floaters produce less income for the Fund, and as short-term
interest rates decline, Inverse Floaters produce more income for the Fund. The
price of Inverse Floaters is expected to decline when interest rates rise and
increase when interest rates decline, in either case generally more so than the
price of a bond with a similar maturity, because of the effect of leverage. As a
result, the price of Inverse Floaters is typically more volatile than the price
of bonds with similar maturities, especially if the relevant TOB Trust is
structured to provide the holder of the Inverse Floaters relatively greater
leveraged exposure to the underlying security (e.g., if the par amount of the
Floaters, as a percentage of the par amount of the underlying security, is
relatively greater). Upon the occurrence of certain adverse events (including a
credit ratings downgrade of the underlying security or a substantial decrease in
the market value of the underlying security), a TOB Trust may be collapsed by
the remarketing agent or liquidity provider and the underlying security
liquidated, and the Fund could lose the entire amount of its investment in the
Inverse Floater and may, in some cases, be contractually required to pay the
shortfall, if any, between the liquidation value of the underlying security and
the principal amount of the Floaters. Consequently, in a rising interest rate
environment, the Fund’s investments in Inverse Floaters could negatively impact
the Fund’s performance and yield, especially when those Inverse Floaters provide
the Fund with relatively greater leveraged exposure to the underlying securities
held by the relevant TOB Trusts.
Rule
144A Securities and Other Exempt Securities Risk. The Fund
may invest in Rule 144A securities and other types of exempt securities, which
are not registered for sale pursuant to an exemption from registration under the
Securities Act of 1933, as amended. These securities,
while
initially privately placed, typically may be resold only to qualified
institutional buyers, or in a privately negotiated transaction, or to a limited
number of purchasers, or in limited quantities after they have been held for a
specified period of time and other conditions are met for an exemption from
registration. If there are an insufficient number of qualified institutional
buyers interested in purchasing such securities at a particular time, the Fund
may have difficulty selling such securities at a desirable time or price. As a
result, the Fund’s investment in such securities may be subject to increased
liquidity risk. In addition, the issuers of Rule 144A securities may require
their qualified institutional buyers (such as the Fund) to keep certain offering
information confidential, which could adversely affect the ability of the Fund
to sell such securities.
Reverse
Repurchase Agreement Risk. Reverse
repurchase agreements involve the risk that the market value of securities to be
repurchased may decline below the repurchase price resulting in a requirement
for the Fund to deliver margin to the other party in the amount of the related
shortfall, or that the other party may default on its obligation, resulting in
the Fund being delayed or prevented from completing the transaction. In the
event the buyer of securities under a reverse repurchase agreement files for
bankruptcy or becomes insolvent, the Fund’s use of the proceeds from the sale of
the securities may be restricted pending a determination by the other party, or
its trustee or receiver, whether to enforce the Fund’s repurchase obligation.
When the Fund engages in reverse repurchase agreements, changes in the value of
the Fund’s investments will have a larger effect on its share price than if it
did not engage in these transactions due to the effect of leverage. Leverage
will make the Fund’s returns more volatile and increase the risk of loss.
Additionally, interest expenses related to reverse repurchase agreements could
exceed the rate of return on debt obligations and other investments held by the
Fund, thereby reducing returns to shareholders.
Changing
Fixed Income Market Conditions Risk. Increases in
the federal funds and equivalent foreign rates or other changes to monetary
10 Invesco
Rochester®
New York Municipals Fund
policy or
regulatory actions may expose fixed income markets to heightened
volatility,
perhaps
suddenly and to a significant degree, and to reduced liquidity for certain fixed
income investments, particularly those with longer maturities. It is difficult
to predict the impact of interest rate changes on various markets. In addition,
decreases in fixed income dealer market-making capacity may also potentially
lead to heightened volatility and reduced liquidity in the fixed income markets.
As a result, the value of the Fund’s investments and share price may decline.
Changes in central bank policies and other governmental actions and political
events within the U.S. and abroad, the U.S. government’s inability at times to
agree on a long-term budget and deficit reduction plan or other legislation
aimed at addressing financial or economic conditions, the threat of a federal
government shutdown, and threats not to increase or suspend the federal
government’s debt limit may also, among other things, affect investor and
consumer expectations and confidence in the financial markets, including in the
U.S. government’s credit rating and ability to service its debt. Such changes
and events may adversely impact the Fund, including its operations, universe of
potential investment options, and return potential, and could also result in
higher than normal redemptions by shareholders, which could potentially increase
the Fund’s portfolio turnover rate and transaction costs and potentially lower
the Fund’s performance returns.
Borrowing
and Leverage Risk. Borrowing
for leverage will subject the Fund to greater costs (for interest payments to
the lender, origination fees and related expenses) than funds that do not borrow
for leverage and these other purposes. The interest on borrowed money is an
expense that might reduce the Fund’s yield, especially if the cost of borrowing
to buy securities exceeds the yield on the securities purchased with the
proceeds of a loan. Using leverage may also make the Fund’s share price more
sensitive, i.e. volatile, to interest rate changes than if the Fund did not use
leverage due to the tendency to exaggerate the effect of any increase or
decrease in the value of the Fund’s portfolio securities. The use of leverage
may also cause the Fund to liquidate portfolio positions when it may not be
advantageous to do so to satisfy its obligations.
Alternative
Minimum Tax Risk. Although
the interest received from municipal securities generally is exempt from federal
income tax, the Fund may invest a portion of its total assets in municipal
securities subject to the federal alternative minimum tax. Accordingly,
investment in the Fund could cause shareholders to be subject to, or result in
an increased liability under, the federal alternative minimum tax.
Taxability
Risk. The Fund’s
investments in municipal securities rely on the opinion of the issuer’s bond
counsel that the interest paid on those securities will not be subject to
federal or state income tax. Tax opinions are generally provided at the time the
municipal security is initially issued. However, tax opinions are not binding on
the Internal Revenue Service, state tax authorities or any court, and after the
Fund buys a security, the Internal Revenue Service, state tax authorities or a
court may determine that a bond issued as tax-exempt should in fact be taxable
and the Fund’s dividends with respect to that bond might be subject to federal
or state income tax. In addition, income from tax-exempt municipal securities
could be declared taxable because of unfavorable changes in tax laws, adverse
interpretations by the Internal Revenue Service, state tax authorities or a
court, or the non-compliant conduct of a bond issuer.
Derivatives
Risk. A derivative
is an instrument whose value depends largely on (and is derived from) the value
of an underlying security, currency, commodity, interest rate, index or other
asset (each referred to as an underlying asset). In addition to risks relating
to the underlying assets, the use of derivatives may include other, possibly
greater, risks, which are described below.
■
Counterparty
Risk. Certain
derivatives do not trade on an established exchange (referred to as
over-the-counter (OTC) derivatives) and are simply financial contracts between
the Fund and a counterparty. When the Fund is owed money on an OTC derivative,
the Fund is dependent on the counterparty to pay or, in some cases, deliver the
underlying asset, unless the Fund can otherwise sell its
derivative
contract to a third party prior to its expiration. Many counterparties are
financial institutions such as banks and broker-dealers and their
creditworthiness (and ability to pay or perform) may be negatively impacted by
factors affecting financial institutions generally. In addition, in the event
that a counterparty becomes bankrupt or insolvent, the Fund’s ability to recover
the collateral that the Fund has on deposit with the counterparty could be
delayed or impaired. For derivatives traded on a centralized exchange, the Fund
generally is dependent upon the solvency of the relevant exchange clearing house
(which acts as a guarantor for each contractual obligation under such
derivatives) for payment on derivative instruments for which the Fund is owed
money.
■
Leverage
Risk. Many
derivatives do not require a payment up front equal to the economic exposure
created by holding a position in the derivative, which creates a form of
leverage. As a result, an adverse change in the value of the underlying asset
could result in the Fund sustaining a loss that is substantially greater than
the amount invested in the derivative or the anticipated value of the underlying
asset. In addition, some derivatives have the potential for unlimited loss,
regardless of the size of the Fund’s initial investment. Leverage may therefore
make the Fund’s returns more volatile and increase the risk of loss. In certain
market conditions, losses on derivative instruments can grow larger while the
value of the Fund’s other assets fall, resulting in the Fund’s derivative
positions becoming a larger percentage of the Fund’s investments.
■
Liquidity
Risk. There is a
smaller pool of buyers and sellers for certain derivatives, particularly OTC
derivatives, than more traditional investments such as stocks. These buyers and
sellers are often financial institutions that may be unable or unwilling to buy
or sell derivatives during times of financial or market stress. Derivative
instruments may therefore be less liquid than more traditional investments and
the Fund may be unable to sell or exit its derivative positions at a desirable
time or price. This risk may be more acute under adverse market conditions,
during which the Fund may be most in need of liquidating its derivative
positions. To the extent that the Fund is unable to exit a derivative position
because of market illiquidity, the Fund may not be able to prevent further
losses of value in its derivatives holdings and the liquidity of the Fund and
its ability to meet redemption requests may be impaired to the extent that a
substantial portion of the Fund’s otherwise liquid assets must be used as
margin. Another consequence of illiquidity is that the Fund may be required to
hold a derivative instrument to maturity and take or make delivery of the
underlying asset that the Adviser would otherwise avoid.
■
Futures
Contracts Risk. The
volatility of futures contracts prices has been historically greater than the
volatility of stocks and bonds. The liquidity of the futures market depends on
participants entering into offsetting transactions rather than making or taking
delivery. To the extent participants decide to make or take delivery, liquidity
in the futures market could be reduced. In addition, futures exchanges often
impose a maximum permissible price movement on each futures contract for each
trading session. The Fund may be disadvantaged if it is prohibited from
executing a trade outside the daily permissible price movement.
■
Swap
Transactions Risk. Under U.S.
financial reform legislation enacted in 2010, certain types of swaps are
required to be executed on a regulated market and cleared through a central
clearing house counterparty, which may entail further risks and costs for the
Fund. Swap agreements are privately negotiated in the over-the-counter
market and may be entered into as a bilateral contract or may be centrally
cleared. In a centrally cleared swap, immediately following execution of the
swap agreement, the swap agreement is submitted
11 Invesco
Rochester®
New York Municipals Fund
for clearing
to a central clearing house counterparty, and the Fund faces the central
clearing house counterparty by means of an account with a futures commission
merchant that is a member of the clearing house.
■
Other
Risks. Compared to
other types of investments, derivatives may be harder to value and may also be
less tax efficient, as described under the “Taxes” section of the prospectus. In
addition, changes in government regulation of derivative instruments could
affect the character, timing and amount of the Fund’s taxable income or gains,
and may limit or prevent the Fund from using certain types of derivative
instruments as a part of its investment strategy, which could make the
investment strategy more costly to implement or require the Fund to change its
investment strategy. Derivatives strategies may not always be successful.
For example, to the extent that the Fund uses derivatives for hedging or to gain
or limit exposure to a particular market or market segment, there may be
imperfect correlation between the value of the derivative instrument and the
value of the instrument being hedged or the relevant market or market segment,
in which case the Fund may not realize the intended benefits. There is also the
risk that during adverse market conditions, an instrument which would usually
operate as a hedge provides no hedging benefits at all. The Fund’s use of
derivatives may be limited by the requirements for taxation of the Fund as a
regulated investment company.
Zero
Coupon or Pay-In-Kind Securities Risk. Zero coupon
and pay-in-kind securities may be subject to greater fluctuation in value and
less liquidity in the event of adverse market conditions than comparably rated
securities paying cash interest at regular interest payment periods. Prices on
non-cash-paying instruments may be more sensitive to changes in the issuer’s
financial condition, fluctuation in interest rates and market demand/supply
imbalances than cash-paying securities with similar credit ratings, and thus may
be more speculative. Investors may purchase zero coupon and pay-in-kind
securities at a price below the amount payable at maturity. Because such
securities do not entitle the holder to any periodic payments of interest prior
to maturity, this prevents any reinvestment of interest payments at prevailing
interest rates if prevailing interest rates rise. The higher yields and interest
rates on pay-in-kind securities reflect the payment deferral and increased
credit risk associated with such instruments and that such investments may
represent a higher credit risk than coupon loans. Pay-in-kind securities may
have a potential variability in valuations because their continuing accruals
require continuing judgments about the collectability of the deferred payments
and the value of any associated collateral. Special tax considerations are
associated with investing in certain lower-grade securities, such as zero coupon
or pay-in-kind securities.
Management
Risk. The Fund is
actively managed and depends heavily on the Adviser’s judgment about markets,
interest rates or the attractiveness, relative values, liquidity, or potential
appreciation of particular investments made for the Fund’s portfolio. The Fund
could experience losses if these judgments prove to be incorrect. There can be
no guarantee that the Adviser’s investment techniques or investment decisions
will produce the desired results. Additionally, legislative, regulatory, or tax
developments may affect the investments or investment strategies available to
the Adviser in connection with managing the Fund, which may also adversely
affect the ability of the Fund to achieve its investment objective.
Portfolio
Holdings
A description
of Fund policies and procedures with respect to the disclosure of Fund portfolio
holdings is available in the SAI, which is available at
www.invesco.com/us.
Fund Management
The
Adviser(s)
Invesco
serves as the Fund’s investment adviser. The Adviser manages the investment
operations of the Fund as well as other investment portfolios that encompass a
broad range of investment objectives, and has agreed to perform or arrange for
the performance of the Fund’s day-to-day management. The Adviser is located at
1331 Spring Street, N.W., Suite 2500, Atlanta, Georgia 30309. The Adviser, as
successor in interest to multiple investment advisers, has been an investment
adviser since 1976.
Sub-Advisers. Invesco has
entered into one or more Sub-Advisory Agreements with certain affiliates to
serve as sub-advisers to the Fund (the Sub-Advisers). Invesco may appoint the
Sub-Advisers from time to time to provide discretionary investment management
services, investment advice, and/or order execution services to the Fund. The
Sub-Advisers and the Sub-Advisory Agreements are described in the
SAI.
Potential
New Sub-Advisers (Exemptive Order Structure). The SEC has
also granted exemptive relief that permits the Adviser, subject to certain
conditions, to enter into new sub-advisory agreements with affiliated or
unaffiliated sub-advisers on behalf of the Fund without shareholder approval.
The exemptive relief also permits material amendments to existing sub-advisory
agreements with affiliated or unaffiliated sub-advisers (including the
Sub-Advisory Agreements with the Sub-Advisers) without shareholder approval.
Under this structure, the Adviser has ultimate responsibility, subject to
oversight of the Board, for overseeing such sub-advisers and recommending to the
Board their hiring, termination, or replacement. The structure does not permit
investment advisory fees paid by the Fund to be increased without shareholder
approval, or change the Adviser's obligations under the investment advisory
agreement, including the Adviser's responsibility to monitor and oversee
sub-advisory services furnished to the Fund.
Exclusion
of Adviser from Commodity Pool Operator Definition
With respect
to the Fund, the Adviser has claimed an exclusion from the definition of
“commodity pool operator” (CPO) under the Commodity Exchange Act (CEA) and the
rules of the Commodity Futures Trading Commission (CFTC) and, therefore, is not
subject to CFTC registration or regulation as a CPO. In addition, the Adviser is
relying upon a related exclusion from the definition of “commodity trading
advisor” (CTA) under the CEA and the rules of the CFTC with respect to the
Fund.
The
terms of the CPO exclusion require the Fund, among other things, to adhere to
certain limits on its investments in “commodity interests.” Commodity interests
include commodity futures, commodity options and swaps, which in turn include
non-deliverable forwards. The Fund is permitted to invest in these instruments
as further described in the Fund’s SAI. However, the Fund is not intended as a
vehicle for trading in the commodity futures, commodity options or swaps
markets. The CFTC has neither reviewed nor approved the Adviser’s reliance on
these exclusions, or the Fund, its investment strategies or this
prospectus.
Adviser
Compensation
During the
fiscal year ended February 29, 2024, the Adviser received compensation of 0.44%
of the Fund's average daily net assets, after fee waiver and/or expense
reimbursement, if any. The advisory fee payable by the Fund shall be reduced by
any amounts paid by the Fund under the administrative services agreement with
the Adviser.
A
discussion regarding the basis for the Board’s approval of the investment
advisory agreement and investment sub-advisory agreements of the Fund is
available in the Fund’s most recent annual or semiannual report to
shareholders.
Portfolio
Managers
The following
individuals are jointly and primarily responsible for the day-to-day management
of the Fund’s portfolio:
12 Invesco
Rochester®
New York Municipals Fund
■
Mark Paris,
Portfolio Manager, who has been responsible for the Fund since 2019 and has been
associated with Invesco and/or its affiliates since 2010.
■
Joshua
Cooney, Portfolio Manager, who has been responsible for the Fund since 2024 and
has been associated with Invesco and/or its affiliates since 1999.
■
Elizabeth S.
Mossow, CFA, Portfolio Manager, who has been responsible for the Fund since 2024
and has been associated with Invesco and/or its affiliates since 2019. From 2007
to 2019, Ms. Mossow was associated with OppenheimerFunds, a global asset
management firm.
■
Tim O'Reilly,
Portfolio Manager, who has been responsible for the Fund since 2020 and has been
associated with Invesco and/or its affiliates since 2010.
■
Julius
Williams, Portfolio Manager, who has been responsible for the Fund since 2020
and has been associated with Invesco and/or its affiliates since
2010.
The
portfolio managers are assisted by investment professionals from the Invesco
Municipal Fund Management Team. Members of the team may change from time to
time.
More
information on the portfolio managers may be found at www.invesco.com/us.
The website is not part of this prospectus.
The
Fund's SAI provides additional information about the portfolio managers'
investments in the Fund, a description of the compensation structure and
information regarding other accounts managed.
Other Information
Sales
Charges
Purchases of
Class A shares of the Fund are subject to the maximum 4.25% initial sales charge
as listed under the heading “Category II Initial Sales Charges” in the
“Shareholder Account Information—Initial Sales Charges (Class A Shares Only)”
section of the prospectus. Purchases of Class C shares are subject to a
contingent deferred sales charge (CDSC) if you sell Class C shares within one
year of purchase; however, the CDSC shall not apply to the purchases of Class C
shares where the selling broker-dealer was not paid a commission at the time of
purchase. For more information on CDSCs, see the “Shareholder Account
Information—Contingent Deferred Sales Charges (CDSCs)” section of this
prospectus.
Dividends
and Distributions
The Fund
expects, based on its investment objective and strategies, that its
distributions, if any, will consist primarily of tax-exempt income.
Dividends
The Fund
generally declares dividends from net investment income, if any, daily and pays
them monthly.
Capital
Gains Distributions
The Fund
generally distributes long-term and short-term capital gains (net of any
available capital loss carryovers), if any, at least annually. Capital gains
distributions may vary considerably from year to year as a result of the Fund's
normal investment activities and cash flows. During a time of economic
volatility, the Fund may experience capital losses and unrealized depreciation
in value of investments, the effect of which may be to reduce or eliminate
capital gains distributions for a period of time. Even though the Fund may
experience a current year loss, it may nonetheless distribute prior year capital
gains.
13 Invesco
Rochester®
New York Municipals Fund
Financial Highlights
The financial
highlights information presented for the Fund includes the financial history of
the predecessor fund, which was reorganized into the Fund after the close of
business on May 24, 2019. The financial highlights show the Fund’s and
predecessor fund’s financial history for the past five fiscal years or, if
shorter, the applicable period of operations since the inception of the Fund or
predecessor fund or class of Fund or predecessor fund shares. The
financial highlights table is intended to help you understand the Fund’s and the
predecessor fund’s financial performance. Certain information reflects financial
results for a single Fund share.
The
total returns in the table represent the rate that an investor would
have earned
(or lost) on an investment in the Fund or predecessor fund (assuming
reinvestment of all dividends and distributions). This information has been
audited by PricewaterhouseCoopers LLP, an independent registered public
accounting firm, whose report, along with the Fund’s financial statements, is
included in the Fund’s annual report, which is available upon
request.
|
|
Net
asset
value,
beginning
of
period |
Net
investment
income(a)
|
Net
gains
(losses)
on
securities
(both
realized
and
unrealized) |
Total
from
investment
operations |
Dividends
from
net
investment
income |
Net
asset
value,
end
of
period |
Total
return(b)
|
Net
assets,
end
of period
(000's
omitted) |
Ratio
of
expenses
to
average
net
assets
with
fee
waivers
and/or expenses
absorbed |
Ratio
of
expenses
to
average net
assets
without
fee
waivers
and/or expenses
absorbed |
Supplemental
ratio
of
expenses
to
average
net
assets
with
fee waivers
(excluding
interest,
facilities
and
maintenance
fees)
|
Ratio
of net
investment
income
to
average
net
assets |
Portfolio
turnover
(c)
|
|
Class
A | |||||||||||||
|
Year
ended 02/29/24 |
$14.75 |
$0.56 |
$0.64 |
$1.20 |
$(0.59
) |
$15.36 |
8.35
%(d) |
$3,584,464 |
1.27
%(d) |
1.27
%(d) |
0.78
%(d) |
3.73
%(d) |
27
% |
|
Year
ended 02/28/23 |
16.94 |
0.52 |
(2.17
) |
(1.65
) |
(0.54
) |
14.75 |
(9.76
)(d) |
3,578,634 |
1.14
(d) |
1.14
(d) |
0.78
(d) |
3.41
(d) |
50 |
|
Year
ended 02/28/22 |
17.07 |
0.43 |
0.00 |
0.43 |
(0.56
) |
16.94 |
2.45
(d) |
4,442,658 |
0.85
(d) |
0.85
(d) |
0.78
(d) |
2.43
(d) |
17 |
|
Year
ended 02/28/21 |
17.55 |
0.51 |
(0.42
) |
0.09 |
(0.57
) |
17.07 |
0.65
(d) |
4,495,785 |
0.92
(d) |
0.92
(d) |
0.80
(d) |
3.04
(d) |
24 |
|
Two
months ended 02/29/20 |
16.78 |
0.08 |
0.79 |
0.87 |
(0.10
) |
17.55 |
5.18 |
4,625,668 |
0.79
(e) |
0.92
(e) |
0.79
(e) |
2.92
(e) |
2 |
|
Year
ended 12/31/19 |
15.35 |
0.62 |
1.35 |
1.97 |
(0.54
) |
16.78 |
12.97 |
4,407,000 |
0.80 |
1.06 |
0.80 |
3.78 |
25 |
|
| |||||||||||||
|
Class
C | |||||||||||||
|
Year
ended 02/29/24 |
14.71 |
0.44 |
0.65 |
1.09 |
(0.48
) |
15.32 |
7.55 |
181,671 |
2.03 |
2.03 |
1.54 |
2.97 |
27 |
|
Year
ended 02/28/23 |
16.89 |
0.40 |
(2.16
) |
(1.76
) |
(0.42
) |
14.71 |
(10.40
)(f) |
209,043 |
1.89
(f) |
1.89
(f) |
1.53
(f) |
2.66
(f) |
50 |
|
Year
ended 02/28/22 |
17.03 |
0.29 |
0.00 |
0.29 |
(0.43
) |
16.89 |
1.63 |
301,046 |
1.61 |
1.61 |
1.54 |
1.67 |
17 |
|
Year
ended 02/28/21 |
17.50 |
0.39 |
(0.41
) |
(0.02
) |
(0.45
) |
17.03 |
(0.01
)(f) |
336,381 |
1.63
(f) |
1.63
(f) |
1.51
(f) |
2.33
(f) |
24 |
|
Two
months ended 02/29/20 |
16.73 |
0.06 |
0.79 |
0.85 |
(0.08
) |
17.50 |
5.07 |
489,818 |
1.54
(e) |
1.67
(e) |
1.54
(e) |
2.16
(e) |
2 |
|
Year
ended 12/31/19 |
15.31 |
0.49 |
1.35 |
1.84 |
(0.42
) |
16.73 |
12.10 |
472,000 |
1.56 |
1.82 |
1.56 |
3.02 |
25 |
|
| |||||||||||||
|
Class
Y | |||||||||||||
|
Year
ended 02/29/24 |
14.75 |
0.59 |
0.66 |
1.25 |
(0.63
) |
15.37 |
8.67 |
812,901 |
1.03 |
1.03 |
0.54 |
3.97 |
27 |
|
Year
ended 02/28/23 |
16.95 |
0.55 |
(2.18
) |
(1.63
) |
(0.57
) |
14.75 |
(9.59
) |
700,660 |
0.90 |
0.90 |
0.54 |
3.65 |
50 |
|
Year
ended 02/28/22 |
17.08 |
0.47 |
0.00 |
0.47 |
(0.60
) |
16.95 |
2.70 |
799,750 |
0.61 |
0.61 |
0.54 |
2.67 |
17 |
|
Year
ended 02/28/21 |
17.55 |
0.55 |
(0.41
) |
0.14 |
(0.61
) |
17.08 |
0.99 |
687,608 |
0.68 |
0.68 |
0.56 |
3.28 |
24 |
|
Two
months ended 02/29/20 |
16.78 |
0.09 |
0.79 |
0.88 |
(0.11
) |
17.55 |
5.23 |
658,644 |
0.54
(e) |
0.67
(e) |
0.54
(e) |
3.16
(e) |
2 |
|
Year
ended 12/31/19 |
15.35 |
0.66 |
1.35 |
2.01 |
(0.58
) |
16.78 |
13.25 |
610,000 |
0.56 |
0.82 |
0.56 |
4.02 |
25 |
|
| |||||||||||||
|
Class
R6 | |||||||||||||
|
Year
ended 02/29/24 |
14.76 |
0.60 |
0.65 |
1.25 |
(0.64
) |
15.37 |
8.66 |
2,922 |
0.98 |
0.98 |
0.49 |
4.02 |
27 |
|
Year
ended 02/28/23 |
16.96 |
0.56 |
(2.18
) |
(1.62
) |
(0.58
) |
14.76 |
(9.53
) |
1,020 |
0.85 |
0.85 |
0.48 |
3.70 |
50 |
|
Year
ended 02/28/22 |
17.08 |
0.48 |
0.01 |
0.49 |
(0.61
) |
16.96 |
2.82 |
1,978 |
0.56 |
0.56 |
0.49 |
2.72 |
17 |
|
Year
ended 02/28/21 |
17.55 |
0.56 |
(0.41
) |
0.15 |
(0.62
) |
17.08 |
1.00 |
1,923 |
0.59 |
0.59 |
0.47 |
3.37 |
24 |
|
Two
months ended 02/29/20 |
16.78 |
0.09 |
0.79 |
0.88 |
(0.11
) |
17.55 |
5.23 |
5,181 |
0.51
(e) |
0.64
(e) |
0.51
(e) |
3.20
(e) |
2 |
|
Period
ended 12/31/19(g)
|
16.44 |
0.40 |
0.29 |
0.69 |
(0.35
) |
16.78 |
4.20 |
5,000 |
0.54
(e) |
0.80
(e) |
0.54
(e) |
4.07
(e) |
25 |
|
| |||||||||||||
|
(a) |
Calculated
using average shares outstanding. |
|
(b) |
Includes
adjustments in accordance with accounting principles generally accepted in
the United States of America and as such, the net asset value for
financial reporting purposes and the returns
based
upon those net asset values may differ from the net asset value and
returns for shareholder transactions. Does not include sales charges and
is not annualized for periods less than one
year,
if applicable. |
|
(c) |
Portfolio
turnover is calculated at the fund level and is not annualized for periods
less than one year, if applicable. For the year ended February 28, 2021,
the portfolio turnover calculation excludes
the
value of securities purchased of $142,218,871 in connection with the
acquisition of Invesco New York Tax Free Income Fund into the
Fund. |
|
(d) |
The
total return, ratio of expenses to average net assets and ratio of net
investment income to average net assets reflect actual 12b-1 fees of 0.24%
for the year ended February 29, 2024 and the
years
ended February 28, 2023, 2022 and 2021,
respectively.. |
|
(e) |
Annualized. |
|
(f) |
The
total return, ratio of expenses to average net assets and ratio of net
investment income to average net assets reflect actual 12b-1 fees of 0.99%
and 0.95% for the years ended February 28,
2023
and February 28, 2021, respectively. |
|
(g) |
Commencement
date after the close of business on May
24, 2019. |
14 Invesco
Rochester®
New York Municipals Fund
Shareholder Account Information
In addition
to the Fund(s), the Adviser serves as investment adviser to many other Invesco
mutual funds that are offered to investors (Invesco Funds or Funds). The
following information is about the Invesco Funds and their share classes that
have different fees and expenses. Certain Invesco Funds have their
own
“Shareholder
Account Information Section”
that should
be consulted for specific information related to those Funds.
Some
investments in the Funds are made through accounts that are maintained by
intermediaries (and not in the name of an individual investor) and some
investments are made indirectly through products that use the Funds as
underlying investments, such as Retirement and Benefit Plans, funds of funds,
qualified tuition plans, and variable insurance contracts (these products are
generally referred to as conduit investment vehicles). If shares of the Funds
are held in an account maintained by an intermediary or in the name of a conduit
investment vehicle (and not in the name of an individual investor), the
intermediary or conduit investment vehicle may impose rules that differ from,
and/or charge a transaction or other fee in addition to, those described in this
prospectus. As a result, the availability of certain share classes and/or
shareholder privileges or services described in this prospectus will depend on
the policies, procedures and trading platforms of the financial intermediary or
conduit investment vehicle. Accordingly, through your financial intermediary you
may be invested in a share class that is subject to higher annual fees and
expenses than other share classes that are offered in this prospectus. Investing
in a share class subject to higher annual fees and expenses may have an adverse
impact on your investment return. Please consult your financial adviser to
consider your options, including your eligibility to qualify for the share
classes and/or shareholder privileges or services described in this
prospectus.
The
Fund is not responsible for any additional share class eligibility requirements,
investment minimums, exchange privileges, or other policies imposed by financial
intermediaries or for notifying shareholders of any changes to them. Please
consult your financial adviser or other financial intermediary for
details.
Unless
otherwise provided, the following are certain defined terms used throughout
this prospectus:
■
Employer
Sponsored Retirement and Benefit Plans include (i) employer sponsored pension or
profit sharing plans that qualify under section
401(a) of the
Internal Revenue Code of 1986, as amended (the Code), including 401(k), money
purchase pension, profit sharing and defined benefit plans; (ii) 403(b) and
non-qualified deferred compensation arrangements that operate similar to plans
described under (i) above, such as 457 plans and executive deferred compensation
arrangements; (iii) health savings accounts maintained pursuant to Section 223
of the Code; and (iv) voluntary employees’ beneficiary arrangements
maintained pursuant to Section 501(c)(9) of the Code.
■
Individual
Retirement Accounts (IRAs) include Traditional and Roth IRAs.
■
Employer
Sponsored IRAs include Simplified Employee Pension (SEP), Salary Reduction
Simplified Employee Pension (SAR-SEP), and Savings Incentive Match Plan for
Employees of Small Employers (SIMPLE) IRAs.
■
Retirement
and Benefit Plans include Employer Sponsored Retirement and Benefit Plans, IRAs
and Employer Sponsored IRAs.
Shareholder
Account Information and additional information is available on the
Internet at www.invesco.com/us. To access your account, go to the tab for
“Account & Services,” then click on “Accounts Overview.” For additional
information about Invesco Funds, consult the Fund’s prospectus and SAI, which
are available on that same website or upon request free of charge. The website
is not part of this prospectus.
Choosing
a Share Class
Each Fund may
offer multiple classes of shares and not all Funds offer all share classes
discussed herein. Each class represents an interest in the same portfolio of
investments. Certain classes have higher expenses than other classes which may
lower the return on your investment when compared to a less expensive class. In
deciding which class of shares to purchase, you should consider the following
attributes of the various share classes, among other things: (i) the
eligibility requirements that apply to purchases of a particular class and any
eligibility requirements of your financial intermediary, (ii) the initial
sales charges and contingent deferred sales charges (CDSCs), if any, applicable
to the class, (iii) the 12b-1 fee, if any, paid by the class, and
(iv) any services you may receive from a financial intermediary. Please
contact your financial adviser to assist you in making your decision. Please
refer to the prospectus fee table for more information on the fees and expenses
of a particular Fund’s share classes.
|
Share
Classes |
|
|
|
|
|
Class
A |
Class
C |
Class
R |
Class
Y |
Class
R5 and R6 |
|
▪ Initial
sales charge which may be
waived
or reduced1
|
▪ No
initial sales charge |
▪ No
initial sales charge |
▪ No
initial sales charge |
▪ No
initial sales charge |
|
▪ CDSC
on certain redemptions1
|
▪ CDSC
on redemptions within one
year
if a commission has been paid |
▪ No
CDSC |
▪ No
CDSC |
▪ No
CDSC |
|
▪ 12b-1
fee of up to 0.25%2
|
▪ 12b-1
fee of up to 1.00%3
|
▪ 12b-1
fee of up to 0.50% |
▪ No
12b-1 fee |
▪ No
12b-1 fee |
|
|
▪ Investors
may only open an
account
to purchase Class C
shares
if they have appointed a
financial
intermediary that allows
for
new accounts in Class C shares
to
be opened. This restriction does
not
apply to Employer Sponsored
Retirement
and Benefit Plans. |
▪ Does
not convert to Class A shares |
▪ Does
not convert to Class A shares |
▪ Does
not convert to Class A
shares |
A-1 The
Invesco Funds
MCF—06/24
|
Share
Classes |
|
|
|
|
|
Class
A |
Class
C |
Class
R |
Class
Y |
Class
R5 and R6 |
|
|
▪ Eligible
for automatic conversion to
Class
A shares. See “Automatic
Conversion
of Class C and Class
CX
Shares” herein. |
▪ Intended
for Retirement and
Benefit
Plans4
|
|
▪ Special
eligibility requirements and
investment
minimums apply (see
“Share
Class Eligibility – Class R5
and
R6 shares” below) |
|
|
▪ Purchase
maximums apply |
|
|
|
1
Invesco
Conservative Income Fund, Invesco Government Money Market Fund and Invesco Short
Term Municipal Fund do not have initial sales charges or CDSCs on redemptions in
most cases.
2
Class A2
shares of Invesco Limited Term Municipal Income Fund and Investor Class shares
of Invesco Government Money Market Fund, Invesco Premier Portfolio and Invesco
Premier U.S. Government Money Portfolio do not have a 12b-1 fee; Invesco Short
Term Bond Fund Class A shares and Invesco Short Duration Inflation Protected
Fund Class A2 shares have a 12b-1 fee of 0.15%; and Invesco Conservative Income
Fund Class A shares have a 12b-1 fee of 0.10%.
3
The 12b-1 fee
for Class C shares of certain Funds is less than 1.00%. The “Fees and
Expenses of the Fund—Annual Fund Operating Expenses” section of this prospectus
reflects the actual 12b-1 fees paid by a Fund.
4
Your financial
intermediary may have additional eligibility criteria for Class R shares. Please
see the “Financial Intermediary- Specific Arrangements” section of this
prospectus for further information.
In addition
to the share classes shown in the chart above, the following Funds offer the
following additional share classes further described in this
prospectus:
■
Investor
Class shares: Invesco Diversified Dividend Fund, Invesco Dividend Income Fund,
Invesco Energy Fund, Invesco EQV European Equity Fund, Invesco Health Care Fund,
Invesco High Yield Fund, Invesco Income Fund, Invesco Income Advantage U.S.
Fund, Invesco Government Money Market Fund, Invesco Municipal Income Fund,
Invesco Real Estate Fund, Invesco Small Cap Growth Fund, Invesco Technology
Fund, Invesco Premier Portfolio and Invesco Premier U.S. Government Money
Portfolio.
■
Class A2
shares: Invesco Short Duration Inflation Protected Fund and Invesco Limited Term
Municipal Income Fund;
■
Class AX
shares: Invesco Government Money Market Fund;
■
Class CX
shares: Invesco Government Money Market Fund;
■
Class P
shares: Invesco Summit Fund;
■
Class S
shares: Invesco Charter Fund, Invesco Select Risk: Moderately Conservative
Investor Fund, Invesco Select Risk: Growth Investor Fund, Invesco Select Risk:
Moderate Investor Fund and Invesco Summit Fund; and
■
Invesco Cash
Reserve Shares: Invesco Government Money Market Fund and Invesco U.S. Government
Money Portfolio.
Share
Class Eligibility
The
availability of certain share classes will depend on how you purchased your
shares. Intermediaries may have different policies regarding the availability of
certain share classes than those described below. You should consult your
financial adviser to consider your options, including your eligibility to
qualify for the share classes described below. The Fund is not responsible for
eligibility requirements imposed by financial intermediaries or for notifying
shareholders of any changes to them. See “Financial Intermediary-Specific
Arrangements” for more information on certain intermediary-specific eligibility
requirements. Please
consult with your financial intermediary if you have any questions regarding
their policies.
Class A,
C and Invesco Cash Reserve Shares
Class A,
C and Invesco Cash Reserve Shares are generally available to all retail
investors, including individuals, trusts, corporations, business and charitable
organizations and Retirement and Benefit Plans. Investors may only open an
account to purchase Class C shares if they have appointed a financial
intermediary that allows for new accounts in Class C shares to be opened. This
restriction does not apply to Employer Sponsored Retirement and Benefit Plans.
The share classes offer different fee structures that are intended to compensate
financial intermediaries for services provided in connection with the sale of
shares and continued maintenance of the customer relationship. You should
consider the services provided by your financial adviser and any other financial
intermediaries who will be involved in the servicing of your account when
choosing a share class.
Class A2 Shares
Class A2 shares,
which are offered only on Invesco Short Duration Inflation Protected Fund and
Invesco Limited Term Municipal Income Fund, are closed to new investors. All
references in this “Shareholder Account Information” section of this prospectus
to Class A shares shall include Class A2 shares, unless otherwise
noted.
Class AX
and CX Shares
Class AX
and CX shares are closed to new investors. Only investors who have continuously
maintained an account in Class AX or CX of Invesco Government Money Market
Fund may make additional purchases into Class AX and CX, respectively, of
Invesco Government Money Market Fund. All references in this “Shareholder
Account Information” section of this prospectus to Class A, C or R shares
of the Invesco Funds shall include CX
shares of
Invesco Government Money Market Fund, unless otherwise noted. All references in
this “Shareholder Account Information” section of this prospectus to Invesco
Cash Reserve Shares of Invesco Government Money Market Fund shall include
Class AX shares of Invesco Government Money Market Fund, unless otherwise
noted.
Class P
Shares
In addition
to the other share classes discussed herein, the Invesco Summit Fund offers
Class P shares, which were historically sold only through the AIM Summit
Investors Plans I and II (each a Plan and, collectively, the Summit Plans).
Class P shares are sold with no initial sales charge and have a 12b-1 fee
of 0.10%. However, Class P shares are not sold to members of the general
public. Only shareholders who had accounts in the Summit Plans at the close of
business on December 8, 2006 may purchase Class P shares and only
until the total of their combined investments in the Summit Plans and in
Class P shares directly equals the face amount of their former Plan under
the 30 year extended investment option. The face amount of a Plan is the
combined total of all scheduled monthly investments under the Plan. For a Plan
with a scheduled monthly investment of $100.00, the face amount would have been
$36,000.00 under the 30 year extended investment option.
Class R
Shares
Class R
shares are intended for Retirement and Benefit Plans. Certain financial
intermediaries have additional eligibility criteria regarding Class R shares. If
you received Class R shares as a result of a merger or reorganization of a
predecessor fund into any of the Funds, you will be permitted to make additional
Class R shares purchases.
Class
R5 and R6 Shares
Class R5 and
R6 shares of the Funds are available for use by Employer Sponsored Retirement
and Benefit Plans, held either at the plan level or through omnibus accounts,
that generally process no more than one net redemption and one net purchase
transaction each day.
Class
R5 and R6 shares of the Funds are also available to institutional investors.
Institutional investors are: banks, trust companies, collective trust funds,
entities acting for the account of a public entity (e.g., Taft-Hartley funds,
states, cities or government agencies), funds of funds or other pooled
A-2 The
Invesco Funds
investment
vehicles, 529 college savings plans, financial intermediaries and corporations
investing for their own accounts, endowments and foundations. For information
regarding investment minimums for Class R5 and R6 shares, please see “Minimum
Investments” below.
Class
R6 shares of the Funds are also available through an intermediary that has
agreed with Invesco Distributors, Inc. to make such shares available for use in
retail omnibus accounts that generally process no more than one net redemption
and one net purchase transaction each day.
Shareholders
eligible to purchase Class R6 Shares must meet the requirements
specified by their intermediary. Not all intermediaries offer Class R6
Shares to their customers.
Closure
of Class R5 shares
The
Fund will discontinue sales of its Class R5 shares to new investors after the
close of business on September 30, 2024. Existing investors who were invested in
Class R5 shares of the Fund on September 30, 2024, and who remain invested in
Class R5 shares of the Fund after that date, may continue to make additional
purchases of Class R5 shares of the Fund. Any Employer Sponsored Retirement and
Benefit Plan or its affiliated plans may continue to make additional purchases
of Class R5 shares of the Fund and may add new participant accounts at the plan
level that may purchase Class R5 shares of the Fund if the Employer Sponsored
Retirement and Benefit Plan or its affiliated plan were invested in Class R5
shares of the Fund as of September 30, 2024 and remain invested in Class R5
shares of the Fund after that date.
Class S
Shares
Class S
shares are limited to investors who purchase shares with the proceeds received
from a systematic contractual investment plan redemption within the
12 months prior to purchasing Class S shares, and who purchase through
an approved financial intermediary that has an agreement with the distributor to
sell Class S shares. Class S shares are not otherwise sold to members
of the general public. An investor purchasing Class S shares will not pay
an initial sales charge. The investor will no longer be eligible to purchase
additional Class S shares at that point where the value of the
contributions to the prior systematic contractual investment plan combined with
the subsequent Class S share contributions equals the face amount of what
would have been the investor’s systematic contractual investment plan under the
30-year investment option. The face amount of a systematic contractual
investment plan is the combined total of all scheduled monthly investments under
that plan. For a plan with a scheduled monthly investment of $100.00, the face
amount would have been $36,000.00 under the 30-year extended investment
option.
Class Y
Shares
Class Y
shares are available to (i) investors who purchase through an account that is
charged an asset-based fee or commission by a financial intermediary, including
through brokerage platforms, where a broker is acting as the investor’s agent,
that may require the payment by the investor of a commission and/or other form
of compensation to that broker, (ii) endowments, foundations, or Employer
Sponsored Retirement and Benefit Plans (with the exception of “Solo 401(k)”
Plans and 403(b) custodial accounts held directly at Invesco), (iii) banks or
bank trust departments acting on their own behalf or as trustee or manager for
trust accounts, or (iv) any current, former or retired trustee, director,
officer or employee (or immediate family members of a current, former or retired
trustee, director, officer or employee) of any Invesco Fund or of Invesco Ltd.
or any of its subsidiaries.
Subject
to any conditions or limitations imposed on the servicing of Class Y
shares by your financial adviser, if you received Class Y shares as a result of
a merger or reorganization of a predecessor fund into any of the Funds, you will
be permitted to make additional Class Y share purchases. In addition, you will
be permitted to make additional Class Y shares purchases if you owned Class Y
shares in a “Solo 401(k)” Plan or 403(b) custodial account held directly at
Invesco if you held such shares in your account on or prior to May 24, 2019, or
if you currently own Class Y shares held in a previously eligible account (as
outlined in (i) in the above paragraph) for which you no longer have a financial
intermediary.
Investor
Class Shares
Investor
Class shares are sold with no initial sales charge and have a maximum 12b-1 fee
of 0.25%. Only the following persons may purchase Investor Class
shares:
■
Investors who
established accounts prior to April 1, 2002, in Investor Class shares with
Invesco Distributors, Inc. (Invesco Distributors) who have continuously
maintained an account in Investor Class shares (this includes anyone listed in
the registration of an account, such as a joint owner, trustee or custodian, and
immediate family members of such persons) without a designated intermediary.
These investors are referred to as “Investor Class grandfathered
investors.”
■
Customers of
a financial intermediary that has had an agreement with the Funds’ distributor
or any Funds that offered Investor Class shares prior to April 1, 2002,
that has continuously maintained such agreement. These intermediaries are
referred to as “Investor Class grandfathered intermediaries.”
■
Any current,
former or retired trustee, director, officer or employee (or immediate family
member of a current, former or retired trustee, director, officer or employee)
of any Invesco Fund or of Invesco Ltd. or any of its subsidiaries.
For
additional shareholder eligibility requirements with respect to Invesco
Premier Portfolio, please see “Shareholder Account Information – Purchasing
Shares and Shareholder Eligibility – Invesco Premier Portfolio.”
Distribution
and Service (12b-1) Fees
Except as
noted below, each Fund has adopted a service and/or distribution plan pursuant
to SEC Rule 12b-1. A 12b-1 plan allows a Fund to pay distribution and service
fees to Invesco Distributors to compensate or reimburse, as applicable, Invesco
Distributors for its efforts in connection with the sale and distribution of the
Fund’s shares, all or a substantial portion of which are paid to the dealer of
record. Because the Funds pay these fees out of their assets on an ongoing
basis, over time these fees will increase the cost of your investment and may
cause you to pay more than the maximum permitted initial sales charges described
in this prospectus.
The following
Funds and share classes do not have 12b-1 plans:
■
Invesco
Limited Term Municipal Income Fund, Class A2 shares.
■
Invesco
Government Money Market Fund, Investor Class shares.
■
Invesco
Premier Portfolio, Investor Class shares.
■
Invesco
Premier U.S. Government Money Portfolio, Investor Class shares.
■
All Funds,
Class Y, Class R5 and Class R6 shares
Under
the applicable service and/or distribution plan, the Funds may pay
distribution and/or service fees up to the following annual rates with respect
to each Fund’s average daily net assets with respect to such class (subject to
the exceptions noted on page A-1):
■
Class A
shares: 0.25%
■
Class C
shares: 1.00%
■
Class P
shares: 0.10%
■
Class R
shares: 0.50%
■
Class S
shares: 0.15%
■
Invesco Cash
Reserve Shares: 0.15%
■
Investor
Class shares: 0.25%
Please
refer to the prospectus fee table for more information on a particular
Fund’s 12b-1 fees.
Initial
Sales Charges (Class A Shares Only)
The Funds are
grouped into six categories for determining initial sales charges. The “Other
Information” section of each Fund’s prospectus will tell you the sales charge
category in which the Fund is classified. Additionally, Class A shares of
Invesco Conservative Income Fund and Invesco Short Term Municipal Fund do not
have initial sales charges. As used below, the term “offering price” with
respect to all categories of Class A shares includes the initial sales
charge.
If
you purchase $1,000,000 or more of Class A shares of Category I, II or V Funds or
$250,000 or more of Class A shares of Category IV or VI Funds (a Large Purchase)
the initial sales charge set forth below will be
A-3 The
Invesco Funds
waived;
though your shares will be subject to a 1% CDSC if you don’t hold such shares
for at least 18 months.
|
Category
I Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$50,000 |
5.50% |
5.82% |
|
| |||
|
$50,000
but less than |
$100,000 |
4.50 |
4.71 |
|
| |||
|
$100,000
but less than |
$250,000 |
3.50 |
3.63 |
|
| |||
|
$250,000
but less than |
$500,000 |
2.75 |
2.83 |
|
| |||
|
$500,000
but less than |
$1,000,000 |
2.00 |
2.04 |
|
| |||
|
Category II
Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$100,000 |
4.25% |
4.44% |
|
| |||
|
$100,000
but less than |
$250,000 |
3.50 |
3.63 |
|
| |||
|
$250,000
but less than |
$500,000 |
2.50 |
2.56 |
|
| |||
|
$500,000
but less than |
$1,000,000 |
2.00 |
2.04 |
|
| |||
|
Category
III Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$100,000 |
1.00% |
1.01% |
|
| |||
|
$100,000
but less than |
$250,000 |
0.75 |
0.76 |
|
| |||
|
$250,000
but less than |
$1,000,000 |
0.50 |
0.50 |
|
| |||
|
Category
IV Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$100,000 |
2.50% |
2.56% |
|
| |||
|
$100,000
but less than |
$250,000 |
1.75 |
1.78 |
|
| |||
|
Category V
Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$100,000 |
3.25% |
3.36% |
|
| |||
|
$100,000
but less than |
$250,000 |
2.75 |
2.83 |
|
| |||
|
$250,000
but less than |
$500,000 |
1.75 |
1.78 |
|
| |||
|
$500,000
but less than |
$1,000,000 |
1.50 |
1.52 |
|
| |||
|
Category
VI Initial Sales Charges | |||
|
|
Investor’s
Sales Charge | ||
|
Amount
invested |
As
a % of
Offering
Price |
As
a % of
Investment | |
|
Less
than |
$50,000 |
5.50% |
5.82% |
|
| |||
|
$50,000
but less than |
$100,000 |
4.50 |
4.71 |
|
| |||
|
$100,000
but less than |
$250,000 |
3.50 |
3.63 |
|
| |||
Class A
Shares Sold Without an Initial Sales Charge
The
availability of certain sales charge waivers and discounts will depend on how
you purchase your shares. Intermediaries may have different policies and
procedures regarding the availability of front-end sales load waivers or
contingent deferred (back-end) sales load (“CDSC”) waivers, exchanges or
conversions between classes or exchanges between Funds; account investment
minimums; and minimum account balances, which are
discussed
below. In all instances, it is the purchaser’s responsibility to notify the Fund
or the purchaser’s financial intermediary at the time of purchase of any
relationship or other facts qualifying the purchaser for sales charge waivers,
discounts or other special arrangements. For waivers and discounts not available
through a particular intermediary, shareholders should consult their financial
advisor to consider their options.
The
following types of investors may purchase Class A shares without
paying an
initial sales charge:
Waivers
Offered by the Fund
■
Investors who
purchase shares through a fee-based advisory account with an approved financial
intermediary. In a fee based advisory program, a financial intermediary
typically charges each investor a fee based on the value of the investor’s
account in exchange for servicing that account.
■
Employer
Sponsored Retirement and Benefit Plans maintained on retirement platforms or by
the Funds’ transfer agent or its affiliates (but not including plans utilizing
the Invesco 403(b)(7) Custodial Account program, or the individual custodial
accounts thereunder):
■
with assets
of at least $1 million; or
■
with at least
100 employees eligible to participate in the plan; or
■
that execute
plan level or multiple-plan level transactions through a single omnibus account
per Fund.
■
Any investor
who purchases his or her shares with the proceeds of an in kind rollover,
transfer or distribution from a Retirement and Benefit Plan where the account
being funded by such rollover is to be maintained by the same financial
intermediary, trustee, custodian or administrator that maintained the plan from
which the rollover distribution funding such rollover originated, or an
affiliate thereof.
■
Investors who
own Investor Class shares of a Fund, who purchase Class A shares of a
different Fund through the same account in which the Investor Class Shares were
first purchased.
■
Funds of
funds or other pooled investment vehicles.
■
Insurance
company separate accounts.
■
Any current
or retired trustee, director, officer or employee of any Invesco Fund or of
Invesco Ltd. or any of its subsidiaries.
■
Any
registered representative or employee of any financial intermediary who has an
agreement with Invesco Distributors to sell shares of the Invesco Funds (this
includes any members of his or her immediate family).
■
Any investor
purchasing shares through a financial intermediary that has a written
arrangement with the Funds’ distributor in which the Funds’ distributor has
agreed to participate in a no transaction fee program in which the financial
intermediary will make Class A shares available without the imposition of a
sales charge.
■
Former
shareholders of Atlas Strategic Income Fund who purchase shares of a Fund into
which shareholders of Invesco Global Strategic Income Fund may exchange if
permitted by the intermediary’s policies.
■
Former
shareholders of Oppenheimer Total Return Fund Periodic Investment Plan who
purchase shares of a Fund into which shareholders of Invesco Main Street Fund
may exchange if permitted by the intermediary’s policies.
■
Certain
participants in Employer-Sponsored IRA Plans utilizing Invesco Trust Company
custodial accounts who were offered Class A shares without an initial sales
charge prior to December 15, 2023, and who continue to purchase Class A
shares.
In
addition, investors may acquire Class A shares without paying an
initial sales
charge in connection with:
■
reinvesting
dividends and distributions;
■
exchanging
shares of one Fund that were previously assessed a sales charge for shares of
another Fund;
■
purchasing
shares in connection with the repayment of an Employer Sponsored Retirement and
Benefit Plan loan administered by the Funds’ transfer agent; and
■
purchasing
Class A shares with proceeds from the redemption of Class C,
Class R, Class R5, Class R6 or Class Y shares where the redemption and
purchase are effectuated on the same business day due to the distribution of a
Retirement and Benefit Plan maintained by the Funds’ transfer agent or one of
its affiliates.
A-4 The
Invesco Funds
Invesco
Distributors also permits certain other investors to invest in Class A
shares without paying an initial charge as a result of the investor’s current or
former relationship with the Invesco Funds. For additional information about
such eligibility, please reference the Funds’ SAI.
Financial
Intermediary-Specific Arrangements
The
financial intermediary-specific waivers, discounts, policies regarding
exchanges and conversions, account investment minimums, minimum account
balances, and share class eligibility requirements that follow are only
available to clients of those financial intermediaries specifically named below
and to Invesco funds that offer the share class(es) to which the arrangements
relate. Please contact your financial intermediary for questions regarding your
eligibility and for more information with respect to your financial
intermediary’s sales charge waivers, discounts, investment minimums, minimum
account balances, and share class eligibility requirements and other special
arrangements. Financial intermediary-specific sales charge waivers, discounts,
investment minimums, minimum account balances, and share class eligibility
requirements and other special arrangements are implemented and administered by
each financial intermediary. It is the responsibility of your financial
intermediary (and not the Funds) to ensure that you obtain proper financial
intermediary-specific waivers, discounts, investment minimums, minimum account
balances and other special arrangements and that you are placed in the proper
share class for which you are eligible through your financial intermediary. In
all instances, it is the purchaser’s responsibility to notify the Fund or the
purchaser’s financial intermediary at the time of purchase of any relationship
or other facts qualifying the purchaser for sales charge waivers or discounts or
other financial intermediary-specific arrangements as disclosed herein. Please
contact your financial intermediary for more information regarding the sales
charge waivers, discounts, investment minimums, minimum account balances, share
class eligibility requirements and other special arrangements available to you
and to ensure that you understand the steps you must take to qualify for such
arrangements. The terms and availability of these waivers and special
arrangements may be amended or terminated at any time.
Ameriprise
Financial
The
following information applies to Class A shares purchases if you have
an account with or otherwise purchase Fund shares through Ameriprise
Financial:
Shareholders
purchasing Fund shares through an Ameriprise
Financial retail
brokerage account are eligible for the following front-end sales charge waivers,
which may differ from those disclosed elsewhere in this Fund’s prospectus or
SAI.
■
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement plans do
not include SEP IRAs, Simple IRAs or SAR-SEPs.
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same Fund (but not any other fund
within the same fund family).
■
Shares
exchanged from Class C shares of the same fund in the month of or following the
7-year anniversary of the purchase date. To the extent that this prospectus
elsewhere provides for a waiver with respect to exchanges of Class C shares or
conversion of Class C shares following a shorter holding period, that waiver
will apply.
■
Employees and
registered representatives of Ameriprise Financial or its affiliates and their
immediate family members.
■
Shares
purchased by or through qualified accounts (including IRAs, Coverdell Education
Savings Accounts, 401(k)s, 403(b) TSCAs subject to ERISA and defined benefit
plans) that are held by a covered family member, defined as an Ameriprise
financial advisor and/or the advisor’s spouse, advisor’s lineal ascendant
(mother, father, grandmother, grandfather, great grandmother, great
grandfather), advisor’s lineal descendant (son, step-son, daughter,
step-daughter, grandson, granddaughter, great grandson, great granddaughter) or
any spouse of a covered family member who is a lineal descendant.
■
Shares
purchased from the proceeds of redemptions within the same fund family, provided
(1) the repurchase occurs within 90 days following the redemption, (2) the
redemption and purchase occur in the same account, and (3) redeemed shares were
subject to a front-end or deferred sales load (i.e. Rights of
Reinstatement).
D.A.
Davidson
&.
Co.
(“D.A.
Davidson”)
Shareholders
purchasing fund shares
including existing fund shareholders through a D.A.
Davidson
platform or
account, or through an introducing broker-dealer or independent registered
investment advisor for which D.A.
Davidson
provides trade execution, clearance, and/or custody services, will be eligible
for the following sales charge waivers (front-end sales charge waivers and
contingent deferred, or back-end, sales charge waivers) and discounts, which may
differ from those disclosed elsewhere in this Fund’s prospectus or
SAI.
■
Front-End
Sales Charge Waivers on Class A Shares available at D.A.
Davidson
■
Shares
purchased within the same fund family through a systematic reinvestment of
capital gains and dividend distributions.
■
Employees and
registered representatives of D.A.
Davidson or
its affiliates and their family members as designated by D.A.
Davidson.
■
Shares
purchased from the proceeds of redemptions within the same fund family, provided
(1) the repurchase occurs within 90 days following the redemption, (2) the
redemption and purchase occur in the same account, and (3) redeemed shares were
subject to a front-end or deferred sales charge (known as Rights of
Reinstatement).
■
A shareholder
in the Fund’s Class C shares will have their shares converted at net asset value
to Class A shares (or the appropriate share class) of the Fund if the shares are
no longer subject to a CDSC and the conversion is consistent with
D.A.
Davidson’s
policies and procedures.
■
CDSC Waivers
on Classes A and C shares available at D.A.
Davidson
■
Death or
disability of the shareholder.
■
Shares sold
as part of a systematic withdrawal plan as described in the fund’s
prospectus.
■
Return of
excess contributions from an IRA Account.
■
Shares sold
as part of a required minimum distribution for IRA or other qualifying
retirement accounts as described in the fund’s prospectus beginning in the
calendar year the shareholder turns age 72.
■
Shares
acquired through a right of reinstatement.
■
Front-end
sales charge discounts available at D.A.
Davidson:
breakpoints, rights of accumulation and/or letters of intent
■
Breakpoints
as described in this prospectus.
■
Rights of
accumulation which entitle shareholders to breakpoint discounts will be
automatically calculated based on the aggregated holding of fund family assets
held by accounts within the purchaser’s household at D.A.
Davidson.
Eligible fund family assets not held at D.A.
Davidson may
be included in the calculation of rights of accumulation only if the shareholder
notifies his or her financial advisor about such assets.
■
Letters of
intent which allow for breakpoint discounts based on anticipated purchases
within a fund family, over a 13-month time period. Eligible fund family assets
not held at D.A.
Davidson may
be included in the calculation of letters of intent only if the shareholder
notifies his or her financial advisor about such assets.
Edward
D.
Jones
& Co., L.P.
(“Edward
Jones”)
Policies
Regarding Transactions Through Edward Jones
The
following information has been provided by Edward Jones:
Effective
on or after December 15, 2023, the following information supersedes
prior information with respect to transactions and positions held in fund shares
through an Edward Jones system. Clients of Edward Jones (also referred to as
“shareholders”) purchasing fund shares on the Edward Jones commission and
fee-based platforms are eligible only for the following sales charge discounts
(also referred to as “breakpoints”) and waivers, which can differ from discounts
and waivers described elsewhere in the mutual fund prospectus or statement of
additional information (“SAI”) or through another broker-dealer. In all
instances, it is the shareholder's
A-5 The
Invesco Funds
responsibility
to inform Edward Jones at the time of purchase of any relationship, holdings of
Invesco funds, or other facts qualifying the purchaser for discounts or waivers.
Edward Jones can ask for documentation of such circumstance. Shareholders should
contact Edward Jones if they have questions regarding their eligibility for
these discounts and waivers.
■
Breakpoints
■
Breakpoint
pricing, otherwise known as volume pricing, at dollar thresholds as described in
the prospectus.
■
Rights of
Accumulation (“ROA”)
■
The
applicable sales charge on a purchase of Class A shares is determined by taking
into account all share classes (except certain money market funds and any assets
held in group retirement plans) of Invesco funds held by the shareholder or in
an account grouped by Edward Jones with other accounts for the purpose of
providing certain pricing considerations (“pricing groups”). If grouping assets
as a shareholder, this includes all share classes held on the Edward Jones
platform and/or held on another platform. The inclusion of eligible fund family
assets in the ROA calculation is dependent on the shareholder notifying Edward
Jones of such assets at the time of calculation. Money market funds are included
only if such shares were sold with a sales charge at the time of purchase or
acquired in exchange for shares purchased with a sales charge.
■
The employer
maintaining a SEP IRA plan and/or SIMPLE IRA plan may elect to establish or
change ROA for the IRA accounts associated with the plan to a plan-level
grouping as opposed to including all share classes at a shareholder or pricing
group level.
■
ROA is
determined by calculating the higher of cost minus redemptions or market value
(current shares x NAV).
■
Letter of
Intent (“LOI”)
■
Through a
LOI, shareholders can receive the sales charge and breakpoint discounts for
purchases shareholders intend to make over a 13-month period from the date
Edward Jones receives the LOI.
The LOI is
determined
by
calculating
the higher of cost or market value
of qualifying
holdings at LOI initiation in combination with the value that the shareholder
intends to buy over a 13-month period to calculate the front-end sales charge
and any breakpoint
discounts.
Each purchase
the shareholder makes during that 13-month
period will
receive the sales charge and
breakpoint
discount
that applies
to the total amount.
The inclusion
of eligible fund family assets in the LOI calculation is dependent on the
shareholder notifying Edward Jones of such assets at the time of calculation.
Purchases made before the LOI is received by Edward Jones are not adjusted under
the LOI and will not reduce the sales charge previously paid. Sales charges will
be adjusted if LOI is not met.
■
If the
employer maintaining a SEP IRA plan and/or SIMPLE IRA plan has elected to
establish or change ROA for the IRA accounts associated with the plan to a
plan-level grouping, LOIs will also be at the plan-level and may only be
established by the employer.
■
Sales Charge
Waivers
Sales charges
are waived for the following shareholders and in the following
situations:
■
Associates of
Edward Jones and its affiliates and other accounts in the same pricing group (as
determined by Edward Jones under its policies and procedures) as the associate.
This waiver will continue for the remainder of the associate's life if the
associate retires from Edward Jones in good-standing and remains in good
standing pursuant to Edward Jones' policies and procedures.
■
Shares
purchased in an Edward Jones fee-based program.
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment. Shares purchased from the proceeds of redeemed shares of the same
fund family
so
long
as the
following conditions are
met: the
proceeds are from the sale of shares within 60 days of the purchase, the sale
and purchase
are made from
a share
class that
charges a
front load
and one of the following:
●
The
redemption and repurchase occur in the same account.
●
The
redemption proceeds are used to process an: IRA contribution, excess
contributions, conversion, recharacterizing of contributions, or distribution,
and the repurchase is done in an account within the same Edward Jones grouping
for ROA.
■
Shares
exchanged into Class A shares from another share class so long as the exchange
is into the same fund and was initiated at the discretion of Edward Jones.
Edward Jones is responsible for any remaining CDSC due to the fund company, if
applicable. Any future purchases are subject to the applicable sales charge as
disclosed in the prospectus.
■
Exchanges
from Class C shares to Class A shares of the same fund,
generally, in
the 84th month following the anniversary of the purchase date
or earlier at
the discretion of Edward Jones.
■
Purchases of
Class 529-A shares through a rollover from either another
education
savings plan or a security used for qualified distributions.
■
Purchases of
Class 529 shares made for recontribution of refunded amounts.
■
Contingent
Deferred Sales Charge (“CDSC”) Waivers
If the
shareholder purchases shares that are subject to a CDSC and those shares are
redeemed before the CDSC is expired, the shareholder is responsible to pay the
CDSC except in the following conditions:
■
The death or
disability of the shareholder.
■
Systematic
withdrawals with up to 10%
per year of
the account value.
■
Return of
excess contributions from an Individual Retirement Account (IRA).
■
Shares
redeemed as part of a required minimum distribution for IRA and retirement
accounts if the redemption is taken in or after the year the shareholder reaches
qualified age based on applicable IRS regulations.
■
Shares
redeemed to pay Edward Jones fees or costs in such cases where the transaction
is initiated by Edward Jones.
■
Shares
exchanged in an Edward Jones fee-based program.
■
Shares
acquired through NAV reinstatement.
■
Shares
redeemed at the discretion of Edward Jones for Minimums Balances, as described
below.
Other
Important Information Regarding Transactions Through Edward
Jones
Minimum
Purchase Amounts
●
Initial
purchase minimum: $250
●
Subsequent
purchase minimum: none
Minimum
Balances
●
Edward Jones
has the right to redeem at its
discretion
fund holdings
with a balance of $250 or less. The following are examples of accounts that are
not included in this policy:
○
A fee-based
account held on an Edward Jones platform
○
A 529 account
held on an Edward Jones platform
○
An account
with an active systematic investment plan or LOI
Exchanging
Share Classes
●
At any time
it deems necessary, Edward Jones has the authority
to exchange
at NAV
a
shareholder's holdings in a fund to Class A shares of the same fund.
Janney
Montgomery Scott LLC (“Janney”)
Shareholders
purchasing shares through a Janney
brokerage
account will be eligible for the following load waivers (front-end sales charge
waivers and contingent deferred sales charge (“CDSC”), or back-end sales charge,
waivers) and discounts, which may differ from those disclosed elsewhere in this
fund’s Prospectus or SAI.
■
Front-end
sales charge waivers on Class A shares available at Janney
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund (but not any other fund
within the fund family).
■
Shares
purchased by employees and registered representatives of Janney or its
affiliates and their family members as designated by Janney.
A-6 The
Invesco Funds
■
Shares
purchased from the proceeds of redemptions within the same fund family, provided
(1) the repurchase occurs within ninety (90) days following the redemption, (2)
the redemption and purchase occur in the same account, and (3) redeemed shares
were subject to a front-end or deferred sales load (i.e., right of
reinstatement).
■
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement plans do
not include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh plans.
■
Shares
acquired through a right of reinstatement.
■
Class C
shares that are no longer subject to a contingent deferred sales charge and are
converted to Class A shares of the same fund pursuant to Janney’s policies and
procedures.
■
CDSC waivers
on Class A and C shares available at Janney
■
Shares sold
upon the death or disability of the shareholder.
■
Shares sold
as part of a systematic withdrawal plan as described in the fund’s
Prospectus.
■
Shares
purchased in connection with a return of excess contributions from an IRA
account.
■
Shares sold
as part of a required minimum distribution for IRA and other retirement accounts
due to the shareholder reaching the qualified age based on applicable IRS
regulations as described in the fund’s Prospectus.
■
Shares sold
to pay Janney fees but only if the transaction is initiated by
Janney.
■
Shares
acquired through a right of reinstatement.
■
Shares
exchanged into the same share class of a different fund.
■
Front-end
sales charge discounts available at Janney: breakpoints, rights of accumulation,
and/or letters of intent
■
Breakpoints
as described in the fund’s Prospectus.
■
Rights of
accumulation (“ROA”), which entitle shareholders to breakpoint discounts, will
be automatically calculated based on the aggregated holding of fund family
assets held by accounts within the purchaser’s household at Janney. Eligible
fund family assets not held at Janney may be included in the ROA calculation
only if the shareholder notifies his or her financial advisor about such
assets.
■
Letters of
intent which allow for breakpoint discounts based on anticipated purchases
within a fund family, over a 13-month time period. Eligible fund family assets
not held at Janney Montgomery Scott may be included in the calculation of
letters of intent only if the shareholder notifies his or her financial advisor
about such assets.
J.P.
Morgan
Securities
LLC
If you
purchase or hold fund shares through an applicable
J.P.
Morgan
Securities LLC brokerage account,
you will be
eligible for the following sales charge waivers (front-end sales charge waivers
and contingent deferred
sales charge
(“CDSC”), or back-end sales charge, waivers),
share class
conversion policy and discounts, which may differ from those disclosed elsewhere
in this fund’s prospectus or Statement of Additional Information
(“SAI”).
Front-end
sales
charge waivers on Class A shares available at J.P. Morgan Securities
LLC
■
Shares
exchanged from Class C (i.e., level-load) shares that are no longer subject to a
CDSC and are exchanged into Class A shares of the same fund pursuant to J.P.
Morgan Securities LLC’s share class exchange policy.
■
Qualified
employer-sponsored defined contribution and defined benefit retirement plans,
nonqualified deferred compensation plans,
other
employee benefit plans and trusts used to fund those plans. For purposes of this
provision, such plans do not include SEP IRAs,
SIMPLE
IRAs,
SAR-SEPs or
501(c)(3)
accounts.
■
Shares of
funds purchased through J.P.
Morgan
Securities LLC Self-Directed Investing accounts.
■
Shares
purchased through rights of reinstatement.
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund (but not any other fund
within the fund family).
■
Shares
purchased by employees and registered representatives of J.P.
Morgan
Securities
LLC
or its
affiliates and
their spouse
or financial dependent as defined by J.P. Morgan Securities LLC.
Class
C to Class A share conversion
■
A shareholder
in the fund’s Class C shares will have their shares converted by
J.P.
Morgan
Securities LLC to Class A shares (or the appropriate share class) of the same
fund if the shares are no longer subject to a CDSC and the conversion is
consistent with J.P.
Morgan
Securities LLC’s policies and procedures.
CDSC
waivers
on Class A and C Shares available at J.P. Morgan Securities LLC
■
Shares sold
upon the death or disability of the shareholder.
■
Shares sold
as part of a systematic withdrawal plan as described in the fund’s
prospectus.
■
Shares
purchased in connection with a return of excess contributions from an IRA
account.
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts
pursuant to the Internal Revenue Code.
■
Shares
acquired through a right of reinstatement.
Front-end
load discounts
available at J.P. Morgan Securities LLC: breakpoints, rights of accumulation
& letters of intent
■
Breakpoints
as described in the prospectus.
■
Rights of
Accumulation (“ROA”) which entitle shareholders to breakpoint discounts as
described in the fund’s prospectus will be automatically calculated based on the
aggregated holding of fund family assets held by accounts within the purchaser’s
household at J.P.
Morgan
Securities LLC.
Eligible fund
family assets not held at J.P.
Morgan
Securities LLC (including 529 program holdings, where applicable) may be
included in the ROA calculation only if the shareholder notifies their financial
advisor about such assets.
Letters
of Intent (“LOI”) which allow for breakpoint discounts based on anticipated
purchases within a fund family, through J.P. Morgan Securities LLC, over a
13-month period of time (if applicable).
Merrill
Lynch
(“Merrill”)
Purchases or
sales of front-end (i.e. Class A) or level-load (i.e., Class C) mutual fund
shares through a Merrill platform or account will be eligible only for the
following sales load waivers (front-end,
contingent
deferred,
or back-end
waivers) and discounts, which differ from those disclosed elsewhere in this
prospectus or SAI. Purchasers will have to buy mutual fund shares directly from
the mutual fund company or through another intermediary to be eligible for
waivers or discounts not listed below.
It
is the client’s responsibility to notify Merrill at the time of purchase or
sale of any
relationship or other facts that qualify the transaction for a waiver or
discount. A Merrill representative may ask for reasonable documentation of such
facts and Merrill may condition the granting of a waiver or discount on the
timely receipt of such documentation.
Additional
information on waivers and discounts is available in the Merrill Sales
Load Waiver and Discounts Supplement (the “Merrill SLWD Supplement”) and in the
Mutual Fund Investing at Merrill pamphlet at ml.com/funds. Clients are
encouraged to review these documents and speak with their financial advisor to
determine whether a transaction is eligible for a waiver or
discount.
■
Front-end
Load Waivers Available at Merrill
■
Shares of
mutual funds available for purchase by employer-sponsored retirement, deferred
compensation, and employee benefit plans (including health savings accounts) and
trusts used to fund those plans provided the shares are not held in a
commission-based brokerage account and shares are held for the benefit of the
plan. For purposes of this provision, employer-sponsored retirement plans do not
include SEP IRAs, Simple IRAs, SAR-SEPs or Keogh plans.
■
Shares
purchased through a Merrill investment advisory program.
A-7 The
Invesco Funds
■
Brokerage
class shares exchanged from advisory class shares due to the holdings moving
from a Merrill investment advisory program to a Merrill brokerage
account.
■
Shares
purchased through the Merrill Edge Self-Directed platform.
■
Shares
purchased through the systematic reinvestment of capital gains distributions and
dividend reinvestment when purchasing shares of the same mutual fund in the same
account.
■
Shares
exchanged from level-load shares to front-end load shares of the same mutual
fund in accordance with the description in the Merrill SLWD
Supplement.
■
Shares
purchased by eligible employees of Merrill or its affiliates and their family
members who purchase shares in accounts within the employee’s Merrill Household
(as defined in the Merrill SLWD Supplement).
■
Shares
purchased by eligible persons associated with the fund as defined in this
prospectus (e.g. the fund’s officers or trustees).
■
Shares
purchased from the proceeds of a mutual fund redemption
in front-end
load shares provided (1) the repurchase is in a mutual fund within the same fund
family;
(2) the
repurchase occurs within 90 calendar days from the redemption trade date, and
(3) the redemption and purchase occur in the same account
(known
as Rights of
Reinstatement).
Automated
transactions
(i.e.
systematic
purchases and withdrawals) and purchases made after
shares are
automatically sold to pay Merrill’s account maintenance fees are not eligible
for Rights of Reinstatement.
■
Contingent
Deferred Sales Charge (“CDSC”) Waivers on Front-end, Back-end, and Level Load
Shares Available at Merrill
■
Shares sold
due to the client’s death or disability (as defined by Internal Revenue Code
Section 22(e)(3)).
■
Shares sold
pursuant to a systematic withdrawal program subject to Merrill’s maximum
systematic withdrawal limits as described in the Merrill SLWD
Supplement.
■
Shares sold
due to return of excess contributions from an IRA account.
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts due
to the investor reaching the qualified age based on applicable IRS
regulation.
■
Front-end or
level-load shares held in commission-based, non-taxable retirement brokerage
accounts (e.g. traditional, Roth, rollover, SEP IRAs, Simple IRAs, SAR-SEPs or
Keogh plans) that are transferred to fee-based accounts or platforms and
exchanged for a lower cost share class of the same mutual fund.
■
Front-end
Load Discounts Available at Merrill: Breakpoints, Rights of Accumulation &
Letters of Intent
■
Breakpoint
discounts, as described in this prospectus, where the sales load is at or below
the maximum sales load that Merrill permits to be assessed to a front-end load
purchase, as described in the Merrill SLWD Supplement.
■
Rights of
Accumulation (ROA), as described in the Merrill SLWD Supplement, which entitle
clients to breakpoint discounts based on the aggregated holdings of mutual fund
family assets held in accounts in their Merrill Household.
■
Letters of
Intent (LOI), which allow for breakpoint discounts on eligible new purchases
based on anticipated future eligible purchases within a fund family at Merrill,
in accounts within your Merrill Household, as further described in the Merrill
SLWD Supplement.
Morgan
Stanley Wealth Management
Shareholders
purchasing Fund shares through a Morgan
Stanley Wealth Management
transactional brokerage account will be eligible only for the following
front-end sales charge waivers with respect to Class A shares,
which may
differ from and may be more limited than those disclosed elsewhere in this
Fund’s Prospectus or SAI.
■
Front-end
Sales Charge Waivers on Class A Shares available at Morgan Stanley Wealth
Management
■
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase
pension plans
and defined benefit plans). For purposes of this provision, employer-sponsored
retirement plans do not include SEP IRAs, Simple IRAs,
SAR-SEPs or
Keogh plans;
■
Morgan
Stanley employee and employee-related accounts according to Morgan Stanley’s
account linking rules;
■
Shares
purchased through reinvestment of dividends and capital gains distributions when
purchasing shares of the same fund;
■
Shares
purchased through a Morgan Stanley self-directed brokerage
account;
■
Class
C
(i.e.,
level-load)
shares that
are no longer subject to a contingent deferred sales charge and are converted to
Class A shares of the same fund pursuant to Morgan Stanley Wealth Management’s
share class conversion
program;
and
■
Shares
purchased from the proceeds of redemptions
within
the same fund
family,
provided
(i)
the
repurchase occurs within 90 days following the redemption, (ii)
the
redemption and purchase occur in the same account, and (iii) redeemed shares
were subject to a front-end or deferred sales charge.
Oppenheimer
& Co.
Inc.
(“OPCO”)
Shareholders
purchasing Fund shares through an
OPCO
platform or
account are eligible only for the following load waivers (front-end sales charge
waivers and contingent deferred, or back-end, sales charge waivers) and
discounts, which may differ from those disclosed elsewhere in this Fund's
prospectus or SAI.
■
Front-end
Sales Load Waivers on Class A Shares available at OPCO
■
Employer-sponsored
retirement,
deferred
compensation and employee benefit plans (including health savings accounts) and
trusts used
to fund those
plans,
provided that
the shares are not held in a commission-based brokerage account and shares are
held for the benefit of the
plan
■
Shares
purchased by or through a 529 Plan
■
Shares
purchased through an OPCO affiliated investment advisory program
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund (but not any other fund
within the fund family)
■
Shares
purchased from the proceeds of redemptions within the same fund
family,
provided (1)
the repurchase occurs within 90 days following the redemption, (2) the
redemption and purchase occur in the same account,
and
(3)
redeemed
shares were subject to a front-end or deferred sales load
(known as
Rights of Reinstatement).
■
A shareholder
in the Fund's Class C shares will have their shares converted at net asset value
to Class A shares (or the appropriate share class) of the Fund if
the shares
are no longer subject to a CDSC and the conversion is in line with the policies
and procedures of OPCO
■
Employees and
registered representatives of OPCO or its affiliates and their family
members
■
Directors or
Trustees of the Fund, and employees of the Fund's investment adviser or any of
its affiliates, as described in this prospectus
■
CDSC Waivers
on A and C Shares available at OPCO
■
Death or
disability of the shareholder
■
Shares sold
as part of a
systematic
withdrawal plan as described in the Fund's prospectus
■
Return of
excess contributions from an IRA
Account
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts due
to the shareholder reaching the qualified age based on applicable IRS
regulations as described in the prospectus
■
Shares sold
to pay OPCO fees but only if the transaction is initiated by OPCO Shares
acquired through a right of reinstatement
■
Front-end
load Discounts Available at OPCO: Breakpoints, Rights of Accumulation &
Letters of Intent
■
Breakpoints
as described in this prospectus.
■
Rights of
Accumulation (ROA) which entitle shareholders to breakpoint discounts will be
automatically calculated based on the aggregated holding of fund family assets
held by accounts within the purchaser's
A-8 The
Invesco Funds
household at
OPCO. Eligible fund family assets not held at OPCO may be included in the ROA
calculation only if the shareholder notifies his or her financial advisor about
such assets.
PFS
Investments Inc. (“PFSI”)
Policies
Regarding Transactions Through PFSI
The
following information supersedes all prior information with respect to
transactions and positions held in fund shares purchased through PFSI and held
on the mutual fund platform of its affiliate, Primerica Shareholder Services
(“PSS”). Clients of PFSI (also referred to as “shareholders”) purchasing fund
shares on the PSS platform are eligible only for the following share classes,
sales charge discounts (also referred to as “breakpoints”) and waivers, which
can differ from share classes, discounts and waivers described elsewhere in this
prospectus or the related statement of additional information (“SAI”) or through
another broker-dealer. In all instances, it is the shareholder’s responsibility
to inform PFSI at the time of a purchase of all holdings of Invesco Funds on the
PSS platform, or other facts qualifying the purchaser for discounts or waivers.
PFSI may request reasonable documentation of such facts, and condition the
granting of any discount or waiver on the timely receipt of such documents.
Shareholders should contact PSS if they have questions regarding their
eligibility for these discounts and waivers.
Share
Classes
■
Class A
shares: in non-retirement accounts, individual retirement accounts (IRA), SEP
IRAs, SIMPLE IRAs, Keogh Plans, and all other account types unless expressly
provided for below.
■
Class C
shares: only in accounts with existing Class C share holdings.
Breakpoints
■
Breakpoint
pricing at dollar thresholds as described in the prospectus of the fund you are
purchasing.
Rights
of Accumulation (“ROA”)
■
The
applicable sales charge on a purchase of Class A shares is determined by taking
into account all share classes (except any assets held in group retirement
plans) of Invesco Funds held by the shareholder on the PSS Platform. The
inclusion of eligible fund family assets in the ROA calculation is dependent on
the shareholder notifying PFSI of such assets at the time of calculation. Shares
of money market funds are included only if such shares were acquired in exchange
for shares of another Invesco Fund purchased with a sales charge. No shares of
Invesco Funds held by the shareholder away from the PSS platform will be granted
ROA with shares of any Invesco Fund purchased on the PSS platform.
■
Any SEP IRA
plan, any SIMPLE IRA plan or any Payroll Deduction plan (“PDP”) on the PSS
platform will be defaulted to plan-level grouping for purposes of ROA, which
allows each participating employee ROA with all other eligible shares held in
plan accounts on the PSS platform. At any time, a participating employee may
elect to exercise a one-time option to change grouping for purposes of ROA to
shareholder- level grouping, which allows the plan account of the electing
employee ROA with her other eligible holdings on the PSS platform, but not with
all other eligible participant holdings in the plan. Eligible shares held in
plan accounts electing shareholder-level grouping will not be available for
purposes of ROA to plan accounts electing plan-level grouping.
■
ROA is
determined by calculating the higher of cost minus redemptions or current market
value (current shares x NAV).
Letter
of Intent (“LOI”)
■
By executing
a LOI, shareholders can receive the sales charge and breakpoint discounts for
purchases shareholders intend to make over a 13-month period through PFSI, from
the date PSS receives the LOI. The purchase price of the LOI is determined by
calculating the higher of cost or market value of qualifying holdings at LOI
initiation in combination with the dollar amount the shareholder intends to
invest over a 13-month period to arrive at total investment for purposes of
determining any breakpoint discount and the applicable front-end sales charge.
Each purchase the shareholder makes during that 13-month period will receive the
sales charge and breakpoint discount that applies to the projected total
investment.
■
Only holdings
of Invesco Funds on the PSS platform are eligible for inclusion in the LOI
calculation and the shareholder must notify PFSI of all eligible assets at the
time of calculation.
■
Purchases
made before the LOI is received by PSS are not adjusted under the LOI, and the
LOI will not reduce any sales charge previously paid. Sales charges will be
automatically adjusted if the total purchases required by the LOI are not
met.
■
If an
employer maintaining a SEP IRA plan, SIMPLE IRA plan or non-IRA PDP on the PSS
platform has elected to establish or change ROA for the accounts associated with
the plan to a plan-level grouping, LOIs will also be at the plan-level and may
only be established by the employer. LOIs are not available to PDP IRA plans on
the PSS platform with plan-level grouping for purposes of ROA, but are available
to any participating employee that elects shareholder-level grouping for
purposes of ROA.
Sales
Charge Waivers
Sales
charges are waived for the following shareholders and in the following
situations:
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment.
■
Shares
purchased with the proceeds of redeemed shares of the same fund family so long
as the following conditions are met: 1) the proceeds are from the sale of shares
within 90 days of the purchase, 2) the sale and purchase are made in the same
share class and the same account or the purchase is made in an individual
retirement account with proceeds from liquidations in a non-retirement account,
and 3) the redeemed shares were subject to a front-end or deferred sales load,
Automated transactions (i.e. systematic purchases and withdrawals), full or
partial transfers or rollovers of retirement accounts, and purchases made after
shares are automatically sold to pay account maintenance fees are not eligible
for this sales charge waiver.
■
Shares
exchanged into Class A shares from another share class so long as the exchange
is into the same fund and was initiated at the discretion of PFSI. PFSI is
responsible for any remaining CDSC due to the fund company, if applicable. Any
future purchases are subject to the applicable sales charge as disclosed in the
prospectus.
Policies
Regarding Fund Purchases Through PFSI That Are Not Held
on the PSS Platform
■
Class R
shares are available through PFSI only in 401(k) plans covering a business owner
with no employees, commonly referred to as a one-participant 401(k) plan or solo
401(k).
Raymond
James Financial Services, Inc.
Shareholders
purchasing Fund shares through a Raymond
James Financial Services, Inc., Raymond
James affiliates and each entity’s affiliates (Raymond James) platform or
account, or through an introducing broker-dealer or independent registered
investment adviser for which Raymond James provides trade execution, clearance,
and/or custody services, will be eligible only for the following load waivers
(front-end sales charge waivers and contingent deferred, or back-end, sales
charge waivers) and discounts, which may differ from those disclosed elsewhere
in this Fund’s prospectus or SAI.
■
Front-end
sales load waivers on Class A shares available at Raymond James
■
Shares
purchased in an investment advisory program.
■
Shares
purchased within the same fund family through a systematic reinvestment of
capital gains distributions and dividend distributions.
■
Employees and
registered representatives of Raymond James or its affiliates and their family
members as designated by Raymond James.
■
Shares
purchased from the proceeds of redemptions within the same fund family, provided
(1) the repurchase occurs within 90 days following the redemption, (2) the
redemption and purchase occur in the same account, and (3) redeemed shares were
subject to a front-end or deferred sales load (known as Rights of
Reinstatement).
A-9 The
Invesco Funds
■
A shareholder
in the Fund’s Class C shares will have their shares converted at net asset value
to Class A shares (or the appropriate share class) of the Fund if the shares are
no longer subject to a CDSC and the conversion is in line with the policies and
procedures of Raymond James.
■
CDSC Waivers
on Classes A and C shares available at Raymond James
■
Death or
disability of the shareholder.
■
Shares sold
as part of a systematic withdrawal plan as described in the fund’s
prospectus.
■
Return of
excess contributions from an IRA Account.
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts due
to the shareholder reaching the qualified age based on applicable IRS
regulations as described in the fund’s prospectus.
■
Shares sold
to pay Raymond James fees but only if the transaction is initiated by Raymond
James.
■
Shares
acquired through a right of reinstatement.
■
Front-end
load discounts available at Raymond James: breakpoints, rights of accumulation,
and/or letters of intent
■
Breakpoints
as described in this prospectus.
■
Rights of
accumulation which entitle shareholders to breakpoint discounts will be
automatically calculated based on the aggregated holding of fund family assets
held by accounts within the purchaser’s household at Raymond James. Eligible
fund family assets not held at Raymond James may be included in the calculation
of rights of accumulation only if the shareholder notifies his or her financial
advisor about such assets.
■
Letters of
intent which allow for breakpoint discounts based on anticipated purchases
within a fund family, over a 13-month time period. Eligible fund family assets
not held at Raymond James may be included in the calculation of letters of
intent only if the shareholder notifies his or her financial advisor about such
assets.
Robert
W. Baird & Co. Incorporated (“Baird”)
Shareholders
purchasing fund shares through a Baird platform or
account will only be eligible for the following sales charge waivers (front-end
sales charge waivers and CDSC waivers) and discounts, which may differ from
those disclosed elsewhere in this prospectus or the SAI.
■
Front-End
Sales Charge Waivers on Class A-shares Available at Baird
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same fund.
■
Shares
purchased by employees and registered representatives of Baird or its affiliate
and their family members as designated by Baird.
■
Shares
purchased from the proceeds of redemptions within the same fund family, provided
(1) the repurchase occurs within 90 days following the redemption, (2) the
redemption and purchase occur in the same account, and (3) redeemed shares were
subject to a front-end or deferred sales charge (known as rights of
reinstatement).
■
A shareholder
in the Fund’s Class C Shares will have their shares converted at net asset value
to Class A shares of the fund if the shares are no longer subject to CDSC and
the conversion is in line with the policies and procedures of Baird.
■
Employer-sponsored
retirement plans or charitable accounts in a transactional brokerage account at
Baird, including 401(k) plans, 457 plans, employer-sponsored 403(b) plans,
profit sharing and money purchase pension plans and defined benefit plans. For
purposes of this provision, employer-sponsored retirement plans do not include
SEP IRAs, Simple IRAs or SAR-SEPs.
■
CDSC Waivers
on Classes A and C shares Available at Baird
■
Shares sold
due to death or disability of the shareholder.
■
Shares sold
as part of a systematic withdrawal plan as described in the Fund’s
Prospectus.
■
Return of
excess contributions from an IRA Account.
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts due
to the shareholder reaching age 72 as described in the Fund’s
prospectus.
■
Shares sold
to pay Baird fees but only if the transaction is initiated by Baird.
■
Shares
acquired through a right of reinstatement.
■
Front-End
Sales Charge Discounts Available at Baird: Breakpoints, Rights of Accumulation
and/or letters of intent
■
Breakpoints
as described in this prospectus.
■
Rights of
accumulation which entitle shareholders to breakpoint discounts will be
automatically calculated based on the aggregated holding of fund family assets
held by accounts within the purchaser’s household at Baird. Eligible fund family
assets not held at Baird may be included in the rights of accumulation
calculation only if the shareholder notifies his or her financial advisor about
such assets.
■
Letters of
Intent (LOI) allow for breakpoint discounts based on anticipated purchases of
within a fund family through Baird, over a 13-month period of time.
Stifel,
Nicolaus & Company, Incorporated and its broker dealer
affiliates (“Stifel”)
Effective
December 15, 2023, shareholders purchasing or holding fund shares,
including existing fund shareholders, through a Stifel, Nicolaus & Company,
Incorporated or affiliated platform that provides trade execution, clearance,
and/or custody services, will be eligible for the following sales charge load
waivers (including front-end sales charge waivers and contingent deferred, or
back-end, (“CDSC”) sales charge waivers) and discounts, which may differ from
those disclosed elsewhere in the Fund’s Prospectus or SAI.
Class
A Shares
As
described elsewhere in this prospectus, Stifel may receive compensation
out of the front-end sales charge if you purchase Class A shares through
Stifel.
Rights
of Accumulation
■
Rights of
accumulation (“ROA”) that entitle shareholders to breakpoint discounts on
front-end sales charges will be calculated by Stifel based on the aggregated
holding of all assets in all classes of shares of Invesco funds held by accounts
within the purchaser’s household at Stifel. Eligible fund family assets not held
at Stifel may be included in the calculation of ROA only if the shareholder
notifies his or her financial advisor about such assets.
■
The employer
maintaining a SEP IRA plan and/or SIMPLE IRA plan may elect to establish or
change ROA for the IRA accounts associated with the plan to a plan-level
grouping as opposed to including all share classes at a shareholder or pricing
group level.
Front-end
sales charge waivers on Class A shares available at Stifel
Sales
charges may be waived for the following shareholders and in the following
situations:
■
Class
C shares that
have been held for more than seven (7) years may be converted to Class
A or other Front-end share class(es)
shares of the
same fund pursuant to Stifel's policies and procedures. To the extent that this
prospectus elsewhere provides for a waiver with respect to the exchange or
conversion of such shares following a shorter holding period, those provisions
shall continue to apply.
■
Shares
purchased by employees and registered representatives of Stifel or its
affiliates and their family members as designated by Stifel
■
Shares
purchased in an Stifel fee-based advisory program, often referred to as a “wrap”
program
■
Shares
purchased through reinvestment of capital gains distributions and dividend
reinvestment when purchasing shares of the same or other fund within the fund
family.
■
Shares
purchased from the proceeds of redeemed shares of the same fund family so long
as the proceeds are from the sale of shares from an account with the same
owner/beneficiary within 90 days of the purchase. For the absence of doubt,
shares redeemed through a Systematic Withdrawal Plan are not eligible for rights
of reinstatement.
■
Shares from
rollovers into Stifel from retirement plans to IRAs
■
Shares
exchanged into Class A shares from another share class so long as the exchange
is into the same fund and was initiated at the direction
A-10 The
Invesco Funds
of Stifel.
Stifel is responsible for any remaining CDSC due to the fund company, if
applicable. Any future purchases are subject to the applicable sales charge as
disclosed in the prospectus.
■
Purchases of
Class 529-A shares through a rollover from another 529 plan
■
Purchases of
Class 529-A shares made for reinvestment of refunded amounts
■
Employer-sponsored
retirement plans (e.g., 401(k) plans, 457 plans, employer-sponsored 403(b)
plans, profit sharing and money purchase pension plans and defined benefit
plans). For purposes of this provision, employer-sponsored retirement plans do
not include SEP IRAs, Simple IRAs or SAR-SEPs.
■
All other
sales charge waivers and reductions described elsewhere in the fund’s prospectus
or SAI still apply.
Contingent
Deferred Sales Charges Waivers on Class A and C Shares
■
Death or
disability of the shareholder or, in the case of 529 plans, the account
beneficiary
■
Shares sold
as part of a systematic withdrawal plan not to exceed 12% annually
■
Return of
excess contributions from an IRA Account.
■
Shares sold
as part of a required minimum distribution for IRA and retirement accounts due
to the shareholder reaching the qualified age based on applicable IRS
regulations.
■
Shares
acquired through a right of reinstatement.
■
Shares sold
to pay Stifel fees or costs in such cases where the transaction is initiated by
Stifel.
■
Shares
exchanged or sold in a Stifel fee-based program
■
All other
sales charge waivers and reductions described elsewhere in the fund’s prospectus
or SAI still apply.
Share
Class Conversions in Advisory Accounts
■
Stifel
continually looks to provide our clients with the lowest cost share class
available based on account type. Stifel reserves the right to convert shares to
the lowest cost share class available at Stifel upon transfer of shares into an
advisory program.
UBS
Financial Services Inc. (“UBS”)
Pursuant
to an agreement with the Distributor, UBS may offer Class Y shares to its
retail brokerage clients whose shares are held in omnibus accounts at UBS, or
its designee. For these clients, UBS may charge commissions or transaction fees
with respect to brokerage transactions in Class Y shares. The minimum investment
for Class Y shares is waived for transactions through such brokerage platforms
at UBS. Please contact your UBS representative for more information about these
fees and other eligibility requirements.
Qualifying
for Reduced Sales Charges and Sales Charge Exceptions
In all
instances, it is the purchaser’s responsibility to notify Invesco Distributors
or its designee of any relationship or other facts qualifying the purchaser as
eligible for reduced sales charges and/or sales charge exceptions and to provide
all necessary documentation of such facts in order to qualify for reduced sales
charges or sales charge exceptions. For additional information on linking
accounts to qualify for ROA or LOI, please see the Funds’ SAI.
The
following types of accounts qualify for reduced sales charges or sales charge
exceptions under ROAs and LOIs:
1.
an individual
account owner;
2.
immediate
family of the individual account owner (which includes the individual’s spouse
or domestic partner; the individual’s children, step-children or grandchildren;
the spouse or domestic partner of the individual’s children, step-children or
grandchildren; the individual’s parents and step-parents; the parents or
step-parents of the individual’s spouse or domestic partner; the individual’s
grandparents; and the individual’s siblings);
3.
a Retirement
and Benefit Plan so long as the plan is established exclusively for the benefit
of an individual account owner;
4.
a Coverdell
Education Savings Account (Coverdell ESA), maintained pursuant to
Section 530 of the Code (in either case, the account must be established by
an individual account owner or have an individual account owner named as the
beneficiary thereof); and
5.
certain
participants utilizing an Invesco 403(b)(7) Custodial Account who were granted
ROA at the plan level (as described below) prior to December 15, 2023, and who
continue to purchase Class A shares.
Alternatively,
an Employer Sponsored Retirement and Benefit Plan (but not including
plans utilizing the Invesco 403(b)(7) Custodial Account program, or the
individual custodial accounts thereunder) or Employer Sponsored IRA may be
eligible to purchase shares pursuant to a ROA at the plan level, and receive a
reduced applicable initial sales charge for a new purchase based on the total
value of the current purchase and the value of other shares owned by the plan’s
participants if:
a)
the employer
or plan sponsor submits all contributions for all participating employees in a
single contribution transmittal (the Invesco Funds will not accept separate
contributions submitted with respect to individual participants);
b)
each
transmittal is accompanied by checks or wire transfers; and
c)
the Invesco
Funds are expected to carry separate accounts in the names of each of the plan
participants,
and each new
participant account is established by submitting an appropriate Account
Application on behalf of each new participant with the contribution
transmittal.
The
Fund's transfer agent may link new participant accounts in Employer
Sponsored Retirement and Benefit Plans (but not including plans utilizing the
Invesco 403(b)(7) Custodial Account program, or the individual custodial
accounts thereunder) and Employer Sponsored IRAs at the plan level for ROA for
the purpose of qualifying those participants for lower initial sales charge
rates.
Participant
accounts in a retirement plan that are eligible to purchase shares
pursuant to a ROA at the plan level may not also be considered eligible to do so
for the benefit of an individual account owner.
Purchases
of Class A shares of Invesco Conservative Income Fund, Invesco
Government Money Market Fund and Invesco Short Term Municipal Fund, Class AX
shares or Invesco Cash Reserve Shares of Invesco Government Money Market Fund
and Invesco U.S. Government Money Portfolio, as applicable, or Investor Class
shares of any Fund will not be taken into account in determining whether a
purchase qualifies for a reduction in initial sales charges pursuant to ROAs or
LOIs.
Rights
of Accumulation
Purchasers
that qualify for ROA may combine new purchases of Class A shares of a Fund
with shares of the Fund or other open-end Invesco Funds currently owned
(Class A, C, IB, IC, P, R, S or Y) for the purpose of qualifying for the
lower initial sales charge rates that apply to larger purchases. The applicable
initial sales charge for the new purchase will be based on the total of your
current purchase and the value of other shares owned based on their current
public offering price. The Funds’ transfer agent may automatically link certain
accounts registered in the same name with the same taxpayer identification
number for the purpose of qualifying you for lower initial sales charge
rates.
Letters
of Intent
Under a LOI,
you commit to purchase a specified dollar amount of Class A shares of one
or more Funds during a 13-month period. The amount you agree to purchase
determines the initial sales charge you pay. If the full amount committed to in
the LOI is not invested by the end of the 13-month period, your account will
generally be assessed the higher initial sales charge that would normally be
applicable to the total amount actually invested. Shares equal in value to 5% of
the intended purchase amount will be held in escrow for this
purpose.
A-11 The
Invesco Funds
Reinstatement
Following Redemption
If you redeem
any class of shares of a Fund, you may reinvest all or a portion of the proceeds
from the redemption (and may include that amount necessary to acquire a
fractional Share to round off his or her purchase to the next full Share) in the
same share class of any Fund within 180 days of the redemption without paying an
initial sales charge. Class P, S, and Y redemptions may be reinvested into Class
A shares without an initial sales charge.
This
reinstatement privilege does not apply to a purchase made through a regularly
scheduled automatic investment plan, such as a purchase by a regularly scheduled
payroll deduction or transfer from a bank account.
This
reinstatement privilege shall be suspended for the period of time in
which a
purchase block is in place on a shareholder’s account. Please see “Purchase
Blocking Policy” discussed below.
In
order to take advantage of this reinstatement privilege, you must inform your
financial adviser or the Funds’ transfer agent that you wish to do so at the
time of your reinvestment.
Contingent
Deferred Sales Charges (CDSCs)
CDSCs
on Class A Shares and Invesco Cash Reserve Shares
Any shares of
a Large Purchase of Class A shares redeemed prior to 18 months after the date of
purchase will be subject to a CDSC of 1% with the exception of Class A shares of
Invesco Conservative Income Fund and Invesco Short Term Municipal Fund which do
not have CDSCs on redemptions.
If
Invesco Distributors pays a concession to a financial intermediary in
connection
with a Large Purchase of Class A shares by an Employer Sponsored Retirement and
Benefit Plan or SIMPLE IRA Plan, the Class A shares will be subject to a 1% CDSC
if all of the Employer Sponsored Retirement and Benefit Plan’s or SIMPLE IRA’s
shares are redeemed within one year from the date of initial
purchase.
If
you acquire Invesco Cash Reserve Shares or Class A shares of Invesco
Government Money Market Fund or Invesco Cash Reserve Shares of Invesco U.S.
Government Money Portfolio through an exchange involving Class A shares that
were subject to a CDSC, the shares acquired as a result of the exchange will
continue to be subject to that same CDSC.
CDSCs
on Class C Shares
Class C
shares are subject to a CDSC; however, the CDSC shall not apply to the purchases
of Class C shares where the selling broker-dealer was not paid a commission at
the time of purchase. If you redeem your shares during the first year since your
purchase has been made you will be assessed a CDSC as disclosed in the “Fees and
Expenses - Shareholder Fees” table in the prospectus, unless you qualify for one
of the CDSC exceptions outlined below.
CDSCs
on Class C Shares – Employer Sponsored Retirement and Benefit Plans and Employer
Sponsored IRAs
Class C
shares are subject to a 1.00% CDSC at the time of redemption if all of the
Employer Sponsored Retirement and Benefit Plan’s or Employer Sponsored IRA’s
shares are redeemed within one year from the date of initial
purchase.
CDSCs
on Class C Shares of Invesco Short Term Bond Fund
Effective
November 1, 2021, Class C shares of Invesco Short Term Bond Fund are subject to
a CDSC. If you acquire Class C shares of any other Fund as a result of an
exchange involving Class C shares of Invesco Short Term Bond Fund that were not
subject to a CDSC prior to November 1, 2021, then the shares acquired as a
result of the exchange will not be subject to a CDSC.
Computing
a CDSC
The CDSC on
redemptions of shares is computed based on the lower of their original purchase
price or current net asset value, net of reinvested dividends and capital gains
distributions. In determining whether to charge a
CDSC, shares
are accounted for on a first-in, first-out basis, which means that you will
redeem shares on which there is no CDSC first, and then shares in the order of
their purchase.
CDSC
Exceptions
Investors who
own shares that are otherwise subject to a CDSC will not pay a CDSC in the
following circumstances:
■
If you
participate in the Systematic Redemption Plan and withdraw up to 12% of the
value of your shares that are subject to a CDSC in any twelve-month
period.
■
If you redeem
shares to pay account fees.
■
If you are
the executor, administrator or beneficiary of an estate or are otherwise
entitled to assets remaining in an account following the death or post-purchase
disability of a shareholder or beneficial owner and you choose to redeem those
shares.
There
are other circumstances under which you may be able to redeem shares
without paying CDSCs. For additional information about such circumstances,
please see the Appendix entitled “Purchase, Redemption and Pricing of Shares” in
each Fund’s SAI.
Shares
acquired through the reinvestment of dividends and distributions are not
subject to CDSCs.
The following
share classes are sold without a CDSC:
■
Class A2
shares of Invesco Short Duration Inflation Protected Fund and Invesco Limited
Term Municipal Income Fund
■
Class A
shares of Invesco Government Money Market Fund
■
Invesco Cash
Reserve Shares of Invesco Government Money Market Fund and Invesco U.S.
Government Money Portfolio
■
Investor
Class shares of any Fund
■
Class P
shares of Invesco Summit Fund
■
Class R5 and
R6 shares of any Fund
■
Class R
shares of any Fund
■
Class S
shares of Invesco Charter Fund, Invesco Select Risk: Moderately Conservative
Investor Fund, Invesco Select Risk: Growth Investor Fund, Invesco Select Risk:
Moderate Investor Fund and Invesco Summit Fund
■
Class Y
shares of any Fund
Purchasing
Shares and Shareholder Eligibility
Invesco
Premier U.S. Government Money Portfolio
For Invesco
Premier U.S. Government Money Portfolio, you may purchase shares using one of
the options below. Unless the Fund closes early on a business day, the Fund’s
transfer agent will generally accept any purchase order placed until 5:00 p.m.
Eastern Time on a business day and may accept a purchase order placed until 5:30
p.m. Eastern Time on a business day. If you wish to place an order between 5:00
p.m. and 5:30 p.m. Eastern Time on a business day, you must place such order by
telephone; however, the Fund’s transfer agent reserves the right to reject or
limit the amount of orders placed during this time. If the Fund closes early on
a business day, the Fund’s transfer agent must receive your purchase order prior
to such closing time. Purchase orders will not be processed unless the account
application and purchase payment are received in good order. In accordance with
the USA PATRIOT Act, if you fail to provide all the required information
requested in the current account application, your purchase order will not be
processed. Additionally, federal law requires that the Fund verifies and records
your identifying information.
Invesco
Premier Portfolio
Only accounts
beneficially owned by natural persons will be permitted to retain their shares.
The Fund has implemented policies and procedures reasonably designed to limit
all beneficial owners of the Fund to natural persons, and investments in the
Fund are limited to accounts beneficially owned by natural persons. Natural
persons may invest in the Fund through certain tax-advantaged savings accounts,
trusts and other retirement and investment accounts, which may include, among
others: participant-directed defined contribution plans; individual retirement
accounts; simplified employee pension arrangements; simple retirement accounts;
custodial accounts; deferred compensation plans for government or tax-exempt
organization employees; Archer medical savings accounts; college savings
A-12 The
Invesco Funds
plans; health
savings account plans; ordinary trusts and estates of natural persons; or
certain other retirement and investment accounts with ultimate investment
authority held by the natural person beneficial owner, notwithstanding having an
institutional decision maker making day-to-day decisions (e.g., a plan sponsor
in certain retirement arrangements or an investment adviser managing
discretionary investment accounts).
Further,
financial intermediaries may only submit purchase orders if they have
implemented policies and procedures reasonably designed to limit all investors
on behalf of whom they submit orders to accounts beneficially owned by natural
persons. Financial intermediaries may be required to provide a written statement
or other representation that they have in place, and operate in compliance with,
such policies and procedures prior to submitting purchase orders. Such policies
and procedures may include provisions for the financial intermediary to promptly
report to the Fund or the transfer agent the identification of any shareholder
of the Fund that does not qualify as a natural person of whom they are aware and
promptly take steps to redeem any such shareholder’s shares of the Fund upon
request by the Fund or the transfer agent, in such manner as it may reasonably
request. The Fund may involuntarily redeem any such shareholder who does not
voluntarily redeem their shares.
Natural
persons may purchase shares using one of the options below. For all
classes of the Fund, other than Investor Class shares, unless the Fund closes
early on a business day, the Fund’s transfer agent will generally accept any
purchase order placed until 5:00 p.m. Eastern Time on a business day and may
accept a purchase order placed until 5:30 p.m. Eastern Time on a business day.
If you wish to place an order between 5:00 p.m. and 5:30 p.m. Eastern Time on a
business day, you must place such order by telephone; or send your request by a
pre-arranged Liquidity Link data transmission however, the Fund’s transfer agent
reserves the right to reject or limit the amount of orders placed during this
time. For Investor Class shares of the Fund, unless the Fund closes early on a
business day, the Fund’s transfer agent will generally accept any purchase order
placed until 4:00 p.m. Eastern Time on a business day and may accept a purchase
order placed until 4:30 p.m. Eastern Time on a business day. If you wish to
place an order between 4:00 p.m. and 4:30 p.m. Eastern Time on a business day,
you must place such order by telephone; however, the Fund’s transfer agent
reserves the right to reject or limit the amount of orders placed during this
time. If the Fund closes early on a business day, the Fund’s transfer agent must
receive your purchase order prior to such closing time. Purchase orders will not
be processed unless the account application and purchase payment are received in
good order. In accordance with the USA PATRIOT Act, if you fail to provide all
the required information requested in the current account application, your
purchase order will not be processed. Additionally, federal law requires that
the Fund verify and record your identifying information.
Minimum Investments
There are no
minimum investments for Class P or S shares for fund accounts. The minimum
investments for Class A, C, R, Y, Investor Class and Invesco Cash Reserve shares
for fund accounts are as follows:
|
Type
of Account |
Initial
Investment
Per
Fund |
Additional
Investments
Per
Fund |
|
Asset
or fee-based accounts managed by your financial
adviser |
None |
None |
|
| ||
|
Employer
Sponsored Retirement and Benefit Plans and
Employer
Sponsored IRAs |
None |
None |
|
| ||
|
IRAs
and Coverdell ESAs if the new investor is
purchasing
shares through a systematic purchase plan |
$25 |
$25 |
|
| ||
|
All
other accounts if the investor is purchasing shares
through
a systematic purchase plan |
50 |
50 |
|
| ||
|
IRAs
and Coverdell ESAs |
250 |
25 |
|
| ||
|
All
other accounts |
1,000 |
50 |
|
| ||
Invesco
Distributors or its designee has the discretion to accept orders on behalf of
clients for lesser amounts.
The minimum
investments for Class R5 and R6 shares are as follows:
There
is no minimum initial investment for an Employer Sponsored Retirement
and Benefit Plan investing through a retirement platform that administers at
least $2.5 billion in retirement plan assets. All other Employer Sponsored
Retirement and Benefit Plans must meet a minimum initial investment of at least
$1 million in each Fund in which it invests.
The
minimum initial investment in each share class for all other institutional
investors is $1 million, unless such investment is made by (i) an investment
company, as defined under the 1940 Act, as amended, that is part of a family of
investment companies which own in the aggregate at least $100 million in
securities, or (ii) an account established with a 529 college savings plan
managed by Invesco, in which case there is no minimum initial
investment.
There
are no minimum investment amounts for Class R6 shares held through
retail omnibus accounts where the intermediary:
■
generally
charges an asset-based fee or commission in addition to those described in this
prospectus; and
■
maintains
Class R6 shares and makes them available to retail investors.
A
financial intermediary may impose different investment minimums than those
set forth above. The Fund is not responsible for any investment minimums imposed
by financial intermediaries or for notifying shareholders of any changes to
them. See “Waivers Available Through Certain Financial Intermediaries and Other
Financial Intermediary-Specific Arrangements” for more information on certain
intermediary-specific investment minimums. Please consult with your financial
intermediary if you have any questions regarding their policies.
How
to Purchase Shares*
|
|
Opening
An Account |
Adding
To An Account |
|
Through
a
Financial
Adviser
or
Financial
Intermediary* |
Contact
your financial adviser or
financial
intermediary. |
Contact
your financial adviser or
financial
intermediary. |
|
By
Mail |
Mail
completed account application
and
check to the Funds’ transfer
agent,
Invesco
Investment Services, Inc.
P.O.
Box 219078,
Kansas
City, MO 64121-9078.
The
Funds’ transfer agent does NOT
accept
the following types of
payments:
Credit Card Checks,
Temporary/Starter
Checks, Third
Party
Checks, and Cash. |
Mail
your check and the remittance
slip
from your confirmation
statement
to the Funds’ transfer
agent.
The Funds’ transfer agent
does
NOT accept the following
types
of payments: Credit Card
Checks,
Temporary/Starter Checks,
Third
Party Checks, and Cash. |
|
By
Wire* |
Mail
completed account application
to
the Funds’ transfer agent. Call
the
Funds’ transfer agent at (800)
959-4246
to receive a reference
number.
Then, use the wire
instructions
provided below. |
Call
the Funds’ transfer agent to
receive
a reference number. Then,
use
the wire instructions provided
below. |
|
Wire
Instructions |
Beneficiary
Bank ABA/Routing #: 011001234
Beneficiary
Account Number: 729639
Beneficiary
Account Name: Invesco Investment Services, Inc.
RFB:
Fund Name, Reference #
OBI:
Your Name, Account # | |
|
By
Telephone* |
Open
your account using one of the
methods
described above. |
The
Bank Account Information
option
on your completed account
application
or complete a
Systematic
Options and Bank
Information
Form. Mail the
application
or form to the Funds’
transfer
agent. Once the Funds’
transfer
agent has received the
form,
call the Funds’ transfer agent
at
the number below to place your
purchase
order. For Class R5 and
R6
shares, call the Funds’ transfer
agent
at (800) 959-4246 and wire
payment
for your purchase order in
accordance
with the wire
instructions
listed above. |
A-13 The
Invesco Funds
|
|
Opening
An Account |
Adding
To An Account |
|
Automated
Investor
Line |
Open
your account using one of the
methods
described above. |
Call
the Funds’ transfer agent’s
24-hour
Automated Investor Line at
1-800-246-5463.
You may place
your
order after you have provided
the
bank instructions that will be
requested. |
|
By
Internet |
Open
your account using one of the
methods
described above. |
Access
your account at
www.invesco.com/us.
The proper
bank
instructions must have been
provided
on your account. You may
not
purchase shares in Retirement
and
Benefit Plans on the internet. |
|
*Class
R5 and R6 shares may only be purchased through a financial intermediary or
by
telephone
at (800) 959-4246. | ||
Non-retirement
retail investors, including high net worth investors investing
directly or through a financial intermediary, are not eligible for Class R5
shares. IRAs and Employer Sponsored IRAs are also not eligible for Class R5
shares. If you hold your shares through a financial intermediary, the terms by
which you purchase, redeem and exchange shares may differ than the terms in this
prospectus depending upon the policies and procedures of your financial
intermediary.
Purchase
orders will not be processed unless the account application and purchase
payment are received in good order. In accordance with the USA PATRIOT Act, if
you fail to provide all the required information requested in the current
account application, your purchase order will not be processed. Additionally,
federal law requires that the Funds verify and record your identifying
information.
Systematic
Purchase Plan (Available for all classes except Class R5 and R6
shares)
You can
arrange for periodic investments in any of the Funds by authorizing the Funds’
transfer agent to withdraw the amount of your investment from your bank account
on a day or dates you specify and in an amount of at least $25 per Fund for IRAs
and Coverdell ESAs, and at least $50 per Fund for all other types of accounts (a
Systematic Purchase Plan). You may stop the Systematic Purchase Plan at any time
by giving the Funds’ transfer agent notice ten days prior to your next scheduled
withdrawal. Certain financial advisers and other financial intermediaries may
also offer systematic purchase plans.
Dollar
Cost Averaging (Available for all classes except Class R5 and R6
shares)
Dollar Cost
Averaging allows you to make automatic periodic exchanges, if permitted, from
one Fund to another Fund or multiple other Funds. The account from which
exchanges are to be made must have a minimum balance of $5,000 before you can
use this option. Exchanges will occur on (or about) the day of the month you
specify, in the amount you specify. Dollar Cost Averaging cannot be set up for
the 29th through the 31st of the month. The minimum amount you can exchange to
another Fund is $50. Your financial intermediary may offer alternative dollar
cost averaging programs with different requirements.
Automatic
Dividend and Distribution Investment
Your
dividends and distributions may be paid in cash or reinvested in the same Fund
or another Fund without paying an initial sales charge.
Unless
you specify otherwise, your dividends and distributions will automatically
be reinvested in the same Fund. You must comply with the following requirements
to be eligible to invest your dividends and distributions in shares of another
Fund:
■
Your account
balance in the Fund paying the dividend or distribution must be at least $5,000;
and
■
Your account
balance in the Fund receiving the dividend or distribution must be at least
$500.
If
you elect to receive your distributions by check, and the distribution
amount is $25
or less, then the amount will be automatically reinvested in the same Fund and
no check will be issued. If you have elected to receive distributions by check,
and the postal service is unable to deliver checks to
your address
of record, then your distribution election may be converted to having all
subsequent distributions reinvested in the same Fund and no checks will be
issued. With respect to certain account types, if your check remains uncashed
for six months, the Fund generally reserves the right to reinvest your
distribution check in your account at the then applicable NAV and to reinvest
all subsequent distributions in shares of the Fund. Such checks will be
reinvested into the same share class of the Fund. You should contact the Funds’
transfer agent to change your distribution option, and your request to do so
must be received by the Funds’ transfer agent before the record date for a
distribution in order to be effective for that distribution. No interest will
accrue on amounts represented by uncashed distribution checks.
Redeeming
Shares*
The Funds’
transfer agent or authorized intermediary, if applicable, must receive your call
before the Funds’ net asset value determination (as defined by the applicable
Fund) in order to effect the redemption at that day’s net asset
value.
Your
broker or financial intermediary may charge service fees for handling
redemption transactions.
|
How
to Redeem Shares | |
|
Through
a Financial
Adviser
or Financial
Intermediary* |
Contact
your financial adviser or financial intermediary. The Funds’
transfer
agent must receive your financial adviser’s or financial
intermediary’s
call before the Funds’ net asset value determination
(as
defined by the applicable Fund) in order to effect the redemption
at
that day’s net asset value. Please contact your financial adviser or
financial
intermediary with respect to reporting of cost basis and
available
elections for your account. |
|
By
Mail |
Send
a written request to the Funds’ transfer agent which
includes: |
|
|
▪ Original
signatures of all registered owners/trustees;
▪ The
dollar value or number of shares that you wish to redeem;
▪ The
name of the Fund(s) and your account number;
▪ The
cost basis method or specific shares you wish to redeem for
tax
reporting purposes, if different than the method already on
record;
and |
|
|
▪ Signature
guarantees, if necessary (see below).
The
Funds’ transfer agent may require that you provide additional
documentation,
or information, such as corporate resolutions or
powers
of attorney, if applicable. If you are redeeming from a
Retirement
and Benefit Plan, you must complete the appropriate
distribution
form. |
|
By
Telephone* |
Call
the Funds’ transfer agent at 1-800-959-4246. You will be
allowed
to redeem by telephone if:
▪ Your
redemption proceeds are to be mailed to your address on
record
(and there has been no change in your address of record
within
the last 15 days) or transferred electronically to a
pre-authorized
checking account;
▪ You
can provide proper identification information;
▪ Your
redemption proceeds do not exceed $250,000 per Fund; and
▪ You
have not previously declined the telephone redemption
privilege. |
|
|
You
may, in limited circumstances, initiate a redemption from an
Invesco
IRA by telephone. Redemptions from Employer Sponsored
Retirement
and Benefit Plans and Employer Sponsored IRAs may be
initiated
only in writing and require the completion of the appropriate
distribution
form, as well as employer authorization. You must call the
Funds’
transfer agent before the Funds’ net asset value
determination
(as defined by the applicable Fund) in order to effect
the
redemption at that day’s net asset value. |
|
Automated
Investor Line |
Call
the Funds’ transfer agent’s 24-hour Automated Investor Line at
1-800-246-5463.
You may place your redemption order after you
have
provided the bank instructions that will be
requested. |
A-14 The
Invesco Funds
|
How
to Redeem Shares | |
|
By
Internet |
Place
your redemption request at www.invesco.com/us. You will be
allowed
to redeem by Internet if:
▪ You
can provide proper identification information;
▪ Your
redemption proceeds do not exceed $250,000 per Fund; and
▪ You
have already provided proper bank information.
Redemptions
from Employer Sponsored Retirement and Benefit
Plans
and Employer Sponsored IRAs may be initiated only in writing
and
require the completion of the appropriate distribution form, as
well
as employer authorization. |
|
*Class
R5 and R6 shares may only be redeemed through a financial intermediary or
by
telephone
at (800) 959-4246. | |
Timing
and Method of Payment
The Funds’
transfer agent typically expects to pay redemption proceeds to redeeming
shareholders within one business day after a redemption request is received in
good order, regardless of the method a Fund uses to make such payment. However,
a Fund may take up to seven days to process a redemption request. “Good order”
means that all necessary information and documentation related to the redemption
request have been provided to the Funds’ transfer agent or authorized
intermediary, if applicable. If your request is not in good order, the Funds’
transfer agent may require additional documentation in order to redeem your
shares. If you redeem shares recently purchased by check or ACH, you may be
required to wait up to ten calendar days before your redemption proceeds are
sent. This delay is necessary to ensure that the purchase has cleared. You can
avoid the check hold period if you pay for your shares with a certified check, a
cashier’s check or a federal wire. Payment may be postponed under unusual
circumstances, as allowed by the SEC, such as when the NYSE restricts or
suspends trading.
In
addition, a temporary hold may be placed on the disbursement of redemption
proceeds from an account if there is a reasonable belief that financial
exploitation of a Specified Adult (as defined below) has occurred, is occurring,
has been attempted, or will be attempted. Notice of such a delay will be
provided in accordance with regulatory requirements. This temporary hold will be
for an initial period of no more than 15 business days while an internal review
is performed. Should the internal review support the belief that financial
exploitation has occurred, is occurring, has been attempted or will be
attempted, the temporary hold may be extended for up to 10 additional business
days. Both the initial and subsequent hold on the disbursement may be terminated
or extended by a state regulator or an agency or court of competent
jurisdiction. For purposes of this paragraph, the term “Specified Adult” refers
to an individual who is (a) a natural person age 65 and older, or (b) a natural
person age 18 and older who is reasonably believed to have a mental or physical
impairment that renders the individual unable to protect his or her own
interests.
If
you redeem by telephone, the Funds’ transfer agent will transmit the
amount of
redemption proceeds electronically to your pre-authorized bank account.
Redemption checks are mailed to your address of record, via first class U.S.
mail, unless you make other arrangements with the Funds’ transfer
agent.
The
Funds’ transfer agent uses reasonable procedures to confirm that instructions
communicated via telephone and the Internet are genuine, and the Funds and the
Funds’ transfer agent are not liable for losses arising from actions taken in
accordance with instructions that are reasonably believed to be
genuine.
A
Fund typically expects to use holdings of cash and cash equivalents and sales of
portfolio assets to meet redemption requests, both regularly and in stressed
market conditions. The Funds also have the ability to redeem in kind as further
described below under “Redemptions in Kind.” Certain Funds have a line of
credit, as disclosed in such Funds’ principal investment strategy and risk
disclosures that may be used to meet redemptions in stressed market
conditions.
Expedited
Redemptions (for Invesco Cash Reserve Shares of Invesco Government Money Market
Fund and Invesco U.S. Government Money Portfolio only)
If you place
your redemption order by telephone, before 11:30 a.m. Eastern Time and request
an expedited redemption, the Funds’ transfer agent will
transmit
payment of redemption proceeds on that same day via federal wire to a bank of
record on your account. If the Funds’ transfer agent receives your redemption
order after 11:30 a.m. Eastern Time and before the close of the customary
trading session of the NYSE, it will transmit payment on the next business
day.
Suspension
of Redemptions
The right of
redemption may be suspended or the date of payment postponed when (a) trading on
the NYSE is restricted, as determined by applicable rules and regulations of the
SEC, (b) the NYSE is closed for other than customary weekend and holiday
closings, (c) the SEC has by order permitted such suspension, or (d) an
emergency as determined by the SEC exists making disposition of portfolio
securities or the valuation of the net assets of the Fund not reasonably
practicable. With respect to Invesco Government Money Market Fund, Invesco U.S.
Government Money Portfolio, Invesco Premier Portfolio and Invesco Premier U.S.
Government Money Portfolio, in the event that the Fund, at the end of a business
day, has invested less than 10% of its total assets in weekly liquid assets or,
with respect to the retail and government money market funds, the Fund’s price
per share as computed for the purpose of distribution, redemption and
repurchase, rounded to the nearest 1%, has deviated from the stable price
established by the Fund’s Board of Trustees (“Board”) or the Board, including a
majority of trustees who are not interested persons as defined in the 1940 Act,
determines that such a deviation is likely to occur, and the Board, including a
majority of trustees who are not interested persons of the Fund, irrevocably has
approved the liquidation of the Fund, the Fund’s Board has the authority to
suspend redemptions of Fund shares.
Liquidity
Fees
As
“Government Money Market Fund” under Rule 2a-7, Invesco Government Money Market
Fund, Invesco Premier U.S. Government Portfolio and Invesco U.S. Government
Money Portfolio are not subject to discretionary liquidity fees on fund
redemptions which might apply to other types of funds. In conformance with Rule
2a-7, the Board has reserved its ability to change this policy with respect to
discretionary liquidity fees, but such change would only become effective after
shareholders were provided with specific advance notice of a change in the
Fund’s policy and have the opportunity to redeem their shares in accordance with
Rule 2a-7 before the policy change became effective.
For
Invesco Premier Portfolio, the
Adviser
(as the
Board’s delegate)
may impose
liquidity fees of up to 2% of the value of the shares redeemed, if such fee is
determined to be in the best interest of the Fund.
Liquidity
fees are most
likely to be imposed, if at all, during times of extraordinary market stress. In
the event that a liquidity fee is imposed, the Board expects that for the
duration of its implementation and the day after which such fee is terminated,
the Fund would strike only one net asset value (“NAV”) per day, at the Fund’s
last scheduled NAV calculation time.
The
imposition and termination of a liquidity fee will be
available on the Fund’s website. If a liquidity fee is applied by the Adviser
(as the Board’s delegate), it will be charged on all redemption orders submitted
after the effective time of the imposition of the fee by the Adviser. Liquidity
fees would reduce the amount you receive upon redemption of your
shares.
The
Adviser
(as the
Board’s delegate)
may, in its
discretion, terminate a liquidity fee at any time if it believes such action to
be in the best interest of a Fund. When a fee is in place, the Fund may elect
not to permit the purchase of shares or to subject the purchase of shares to
certain conditions, which may include affirmation of the purchaser’s knowledge
that a fee is in effect. When a fee is in place, shareholders will not be
permitted to exchange into or out of a Fund.
There
is some degree of uncertainty with respect to the tax treatment of liquidity
fees received by a Fund, and such tax treatment may be the subject to future IRS
guidance. If a Fund receives liquidity fees, it will consider the appropriate
tax treatment of such fees to the Fund at such time. Liquidity fees will
generally be used to assist a Fund to help preserve its market–based NAV per
share. It is possible that a liquidity fee will be returned to shareholders in
the form of a distribution.
Financial
intermediaries are required to promptly take the steps requested by
the Funds or their designees to impose or help to implement,
A-15 The
Invesco Funds
modify,
or remove a
liquidity fee as requested from time to time, including the rejection of orders
due to the imposition of a fee or the prompt re-confirmation of orders following
a notification regarding the implementation of a fee. If a liquidity fee is
imposed, these steps are expected to include the submission of separate purchase
and redemption orders (on a gross basis), rather than combined purchase and
redemption orders (on a net basis), from the time of the effectiveness of the
liquidity fee and the submission of order information to the Fund or its
designee prior to the next calculation of a Fund’s NAV, including information on
orders received in good order and eligible to receive a price computed on a day
on which the Fund imposes a liquidity fee. Unless otherwise agreed to between a
Fund and financial intermediary, the Fund will withhold liquidity fees on behalf
of financial intermediaries. A redemption request that a Fund determines in its
sole discretion has been received in good order by the Fund or its designated
agent prior to the imposition of a liquidity fee may be paid by the Fund without
the deduction of a liquidity fee. If a liquidity fee is imposed during the day,
an intermediary who receives both purchase and redemption orders from a single
account holder is not required to net the purchase and redemption orders.
However, the intermediary is permitted to apply the liquidity fee to the net
amount of redemptions (even if the purchase order was received prior to the time
the liquidity fee was imposed).
Where
a Financial Intermediary serves as a Fund’s agent for the purpose of
receiving orders, trades that are not transmitted to the Fund by the Financial
Intermediary before the time required by the Fund or the transfer agent may, in
the Fund’s discretion, be processed on an as-of basis, and any cost or loss to
the Fund or transfer agent or their affiliates, from such transactions shall be
borne exclusively by the Financial Intermediary.
Systematic
Withdrawals (Available for all classes except Class R5 and R6
shares)
You may
arrange for regular periodic withdrawals from your account in amounts equal to
or greater than $50 per Fund. The Funds’ transfer agent will redeem the
appropriate number of shares from your account to provide redemption proceeds in
the amount requested. You must have a total account balance of at least $5,000
in order to establish a Systematic Redemption Plan, unless you are establishing
a Required Minimum Distribution for a Retirement and Benefit Plan. You can stop
this plan at any time by giving ten days’ prior notice to the Funds’ transfer
agent.
Check
Writing
The Funds’
transfer agent has previously provided check writing privileges for accounts in
the following Funds and share classes:
■
Invesco
Government Money Market Fund, Invesco Cash Reserve Shares, Class AX shares,
Class Y shares and Investor Class shares
■
Invesco U.S.
Government Money Portfolio, Invesco Cash Reserve Shares and Class Y
shares
■
Invesco
Premier Portfolio, Investor Class shares
■
Invesco
Premier U.S. Government Money Portfolio, Investor Class shares
Effective
August
28,
2023,
the
Funds’
transfer
agent no longer accepts Check Writing
authorization
forms and,
effective
December
31,
2023,
the
Fund’s transfer agent ceased accepting checks as a valid form of
redemption.
Check
writing privileges are not available for Retirement and Benefit Plans. Checks
are not eligible to be converted to ACH by the payee. You may not give
authorization to a payee by phone to debit your account by ACH for a debt owed
to the payee.
If
you do not have a sufficient number of shares in your account to cover the
amount of the check and any applicable deferred sales charge, the check will be
returned and no shares will be redeemed. Because it is not possible to determine
your account’s value in advance, you should not write a check for the entire
value of your account or try to close your account by writing a
check.
Signature
Guarantees
The Funds’
transfer agent requires a signature guarantee in the following
circumstances:
■
When your
redemption proceeds exceed $250,000 per Fund.
■
When you
request that redemption proceeds be paid to someone other than the registered
owner of the account.
■
When you
request that redemption proceeds be sent somewhere other than the address of
record or bank of record on the account.
■
When you
request that redemption proceeds be sent to a new address or an address that
changed in the last 15 days.
The
Funds’ transfer agent will accept a guarantee of your signature by a
number of
different types of financial institutions. Call the Funds’ transfer agent for
additional information. Some institutions have transaction amount maximums for
these guarantees. Please check with the guarantor institution to determine
whether the signature guarantee offered will be sufficient to cover the value of
your transaction request.
Redemptions
in Kind
Although the
Funds generally intend to pay redemption proceeds solely in cash, the Funds
reserve the right to determine, in their sole discretion, whether to satisfy
redemption requests by making payment in securities or other property (known as
a redemption in kind). Redemptions in kind may result in transaction costs
and/or market fluctuations associated with liquidating or holding the
securities, respectively.
Purchases-in-Kind
You may
purchase shares of a Fund by transferring securities to a Fund in exchange for
Fund shares (“in-kind purchases”). In-kind purchases may be made only upon the
Funds’ approval and determination that the securities are acceptable investments
for the Fund and are purchased consistent with the Fund’s procedures relating to
in-kind purchases. The Funds reserve the right to amend or terminate this
practice at any time. You must call the Funds at (800) 959-4246 before sending
any securities. Please see the SAI for additional details.
Redemptions
by Large Shareholders
At times, the
Fund may experience adverse effects when certain large shareholders redeem large
amounts of shares of the Fund. Large redemptions may cause the Fund to sell
portfolio securities at times when it would not otherwise do so. In addition,
these transactions may also accelerate the realization of taxable income to
shareholders (if applicable) if such sales of investments resulted in gains and
may also increase transaction costs and/or increase in the Fund’s expense ratio.
When experiencing a redemption by a large shareholder, the Fund may delay
payment of the redemption request up to seven days to provide the investment
manager with time to determine if the Fund can redeem the request-in-kind or to
consider other alternatives to lessen the harm to remaining shareholders. Under
certain circumstances, however, the Fund may be unable to delay a redemption
request, which could result in the automatic processing of a large redemption
that is detrimental to the Fund and its remaining shareholders.
Redemptions
Initiated by the Funds
If your
account has been open at least one year, you have not made an additional
purchase in the account during the past six calendar months, and the value of
your account falls below $500 for three consecutive months for any reason,
including market fluctuation, the Funds have the right to redeem the account
after giving you 60 days’ prior written notice. You may avoid having your
account redeemed during the notice period by bringing the account value up to
$500 or by initiating a Systematic Purchase Plan.
A
financial intermediary may have a different policy regarding redemptions
of accounts with small balances. The Fund is not responsible for any small
account balance policies imposed by financial intermediaries or for notifying
shareholders of any changes to them. See “Waivers Available Through Certain
Financial Intermediaries and Other Financial Intermediary-Specific Arrangements”
for more information on certain intermediary-specific small account balance
policies. Please consult with your financial intermediary if you have any
questions regarding their policies.
If
a Fund determines that you have not provided a correct Social Security or
other tax identification number on your account application, or
A-16 The
Invesco Funds
the Fund is
not able to verify your identity as required by law, the Fund may, at its
discretion, redeem the account and distribute the proceeds to you.
In
order to separate retail investors (natural persons) and non-retail investors,
the Invesco Premier Portfolio reserve the right to redeem shares in any account
that the Funds cannot confirm to their satisfaction are beneficially owned by
natural persons. The Funds will provide advance written notice of their intent
to make any such involuntary redemptions. The Funds reserve the right to redeem
shares in any account that they cannot confirm to their satisfaction are
beneficially owned by natural persons, after providing advance
notice.
Neither
a Fund nor its investment adviser will be responsible for any loss in an
investor’s account or tax liability resulting from an involuntary
redemption.
Minimum
Account Balance
A low balance
fee of $12 per year (the Low Balance Fee) may be deducted annually from all
accounts held in the Funds (each a Fund Account) with a value less than $750
(the Low Balance Amount).
The Low
Balance Fee and Low Balance Amount are determined by the Funds and the Adviser,
and may be adjusted for any year depending on various factors, including market
conditions. The Low Balance Fee, Low Balance Amount and the date on which the
Low Balance Fee will be deducted from any Fund Account will be posted on our
website, www.invesco.com/us, on or about November 1 of each year. This fee is
collected by the Funds' transfer agent by redeeming sufficient shares from the
shareholder's Fund Account,
and is used
to reduce the expenses that would otherwise be payable by the Funds to the
Funds' transfer agent under the Funds'
agreement
with the transfer agent.
The
Low Balance Fee and Low Balance Amount do not apply to Fund Accounts held
in a Retirement and Benefit Plan for which an Invesco Affiliate acts as the plan
document provider or custodian for underlying participant or IRA accounts.
However, for purposes of all other Retirement and Benefit Plans, the Low Balance
Fee and Low Balance Amount shall apply to each Fund Account (as appropriate)
that is maintained by the Funds' transfer agent in the underlying participant or
IRA Account.
The
Funds and the Adviser reserve the right to waive the Low Balance Fee, change
the Low Balance amount or modify the conditions for assessment of the Low
Balance Fee at any time.
Exchanging
Shares
You may,
under certain circumstances, exchange shares in one Fund for those of another
Fund. An exchange is the purchase of shares in one Fund which is paid for with
the proceeds from a redemption of shares of another Fund effectuated on the same
day. Any gain on the transaction may be subject to federal income tax.
Accordingly, the procedures and processes applicable to redemptions of Fund
shares, as discussed under the heading “Redeeming Shares” above, will apply.
Before requesting an exchange, review the prospectus of the Fund you wish to
acquire.
All
exchanges are subject to the limitations set forth in the prospectuses
of the Funds.
If you wish to exchange shares of one Fund for those of another Fund, you must
consult the prospectus of the Fund whose shares you wish to acquire to determine
whether the Fund is offering shares to new investors and whether you are
eligible to acquire shares of that Fund.
Permitted
Exchanges
Except as
otherwise provided herein or in the SAI, you generally may exchange your shares
for shares of the same class of another Fund. The following table shows
generally permitted exchanges from one Fund to another Fund (exceptions listed
below under “Exchanges Not Permitted”):
|
Exchange
From |
Exchange
To |
|
Invesco
Cash Reserve Shares |
Class
A, C, R, Investor Class |
|
| |
|
Class
A |
Class
A, Investor Class, Invesco Cash Reserve Shares* |
|
| |
|
Class
A2 |
Class
A, Investor Class, Invesco Cash Reserve Shares |
|
| |
|
Class
AX |
Class
A, AX, Investor Class, Invesco Cash Reserve
Shares |
|
| |
|
Investor
Class |
Class
A, Investor Class |
|
| |
|
Class
P |
Class
A, Invesco Cash Reserve Shares |
|
| |
|
Exchange
From |
Exchange
To |
|
Class
S |
Class
A, S, Invesco Cash Reserve Shares |
|
| |
|
Class
C |
Class
C* |
|
| |
|
Class
CX |
Class
C, CX |
|
| |
|
Class
R |
Class
R* |
|
| |
|
Class
R5 |
Class
R5 |
|
| |
|
Class
R6 |
Class
R6 |
|
| |
|
Class
Y |
Class
Y* |
|
*
You may exchange Class Y shares of Invesco U.S. Government Money Portfolio
for Class A, C
or
R shares of any other Fund as long as you are otherwise eligible for such
share class. If you
exchange
Class Y shares of Invesco U.S. Government Money Portfolio for Class A, C
or R shares
of
any other Fund, you may exchange those Class A, C or R shares back into
Class Y shares of
Invesco
U.S. Government Money Portfolio, but not Class Y shares of any other
Fund. | |
Exchanges
into Invesco Senior Loan Fund and Invesco Dynamic Credit Opportunity
Fund
Invesco
Senior Loan Fund and Invesco Dynamic Credit Opportunity Fund (the “Interval
Funds”) are closed-end interval funds that continuously offer their shares
pursuant to the terms and conditions of their prospectuses. The Adviser is the
investment adviser for the Interval Funds. As with the Invesco Funds, you
generally may exchange your shares of any Invesco Fund for the same class of
shares of the Interval Funds. Please refer to the prospectuses for the Interval
Funds for more information, including the share classes offered by each Interval
Fund and limitations on exchanges out of the Interval Funds.
Exchanges
Not Permitted
The following
exchanges are not permitted:
■
Investor
Class shares cannot be exchanged for Class A shares of any Fund which
offers Investor Class shares.
■
Class A2
shares of Invesco Short Duration Inflation Protected Fund and Invesco Limited
Term Municipal Income Fund cannot be exchanged for Class A shares of
those Funds.
■
Invesco Cash
Reserve Shares cannot be exchanged for Class C or R shares if the shares
being exchanged were acquired by exchange from Class A shares of any
Fund.
■
All existing
systematic exchanges and reallocations will cease and these options will no
longer be available on all 403(b) prototype plans.
■
Class A, C or
R shares of a Fund acquired by exchange of Class Y shares of Invesco U.S.
Government Money Portfolio cannot be exchanged for Class Y shares of any Fund,
except Class Y shares of Invesco U.S. Government Money Portfolio.
Exchange
Conditions
Shares must
have been held for at least one day prior to the exchange with the exception of
dividends and distributions that are reinvested.
Under
unusual market conditions, a Fund may delay the exchange of shares for up
to five business days if it determines that it would be materially disadvantaged
by the immediate transfer of exchange proceeds. The exchange privilege is not an
option or right to purchase shares. Any of the participating Funds or the
distributor may modify or terminate this privilege at any time.
Initial
Sales Charges, CDSCs and 12b-1 Fees Applicable to Exchanges
You may be
required to pay an initial sales charge when exchanging from a Fund with a lower
initial sales charge than the one into which you are exchanging. If you exchange
into shares that are subject to a CDSC, the Funds’ transfer agent will begin the
holding period for purposes of calculating the CDSC on the date you made your
initial purchase.
In
addition, as a result of differences in the forms of distribution plans
among the
Funds, certain exchanges of Class A shares, Class C shares, and Class R shares
of a Fund for the same class of shares of another Fund may result in investors
paying a higher or a lower 12b-1 fee on the Fund being exchanged into. Please
refer to the prospectus fee table and financial highlights table and the SAI for
more information on the fees and expenses, including applicable 12b-1 fees, of
the Fund you wish to acquire.
A-17 The
Invesco Funds
Share
Class Conversions
Shares of one
class of a Fund may be converted into shares of another class of the same Fund,
provided that you are eligible to buy that share class. Investors who hold Fund
shares through a financial intermediary that does not have an agreement to make
certain share classes of the Funds available or that cannot systematically
support the conversion may not be eligible to convert their shares. Furthermore,
your financial intermediary may have discretion to effect a conversion on your
behalf. Consult with your financial intermediary for details. Any CDSC
associated with the converting shares will be assessed immediately prior to the
conversion to the new share class. The conversion of shares of one class of a
Fund into shares of another class of the same Fund is not taxable for federal
income tax purposes and no gain or loss will be reported on the transaction. See
the applicable prospectus for share class information.
Fees
and expenses differ between share classes. You should read the prospectus
for the share class into which you are seeking to convert your shares prior to
the conversion.
Automatic
Conversion of Class C and Class CX Shares
Class C and
Class CX shares held for eight years after purchase are eligible for automatic
conversion into Class A and Class AX shares of the same Fund, respectively,
except that for the Invesco Government Money Market Fund and Invesco U.S.
Government Money Portfolio, the Funds’ Class C and/or Class CX shares would be
eligible to automatically convert into the Fund’s Invesco Cash Reserve Share
Class and all existing Class C shares of Invesco Short Term Municipal Fund will
automatically convert to Class A shares of that Fund at the end of June 2022
(the Conversion Feature). The automatic conversion pursuant to the Conversion
Feature will generally occur at the end of the month following the eighth
anniversary after a purchase of Class C or Class CX shares (the Conversion
Date). The first conversion of Class C and Class CX shares to Class A and Class
AX shares under this policy would occur at the end of December 2020 for all
Class C and Class CX shares that were held for more than eight years as of
November 30, 2020.
Automatic
conversions pursuant to the Conversion Feature will be on the basis of
the NAV per share, without the imposition of any sales charge (including a
CDSC), fee or other charge. All such automatic conversions of Class C and Class
CX shares will constitute tax-free exchanges for federal income tax
purposes.
Class
C and Class CX shares of a Fund acquired through a reinvestment of dividends
and distributions will convert to Class A and Class AX shares, respectively, of
the Fund (or Invesco Cash Reserve shares for Invesco Government Money Market
Fund) on the Conversion Date pro rata with the converting Class C and Class CX
shares of that Fund that were not acquired through reinvestment of dividends and
distributions.
Class
C or Class CX shares held through a financial intermediary in existing
omnibus Employer Sponsored Retirement and Benefit Plans and other omnibus
accounts may be converted pursuant to the Conversion Feature by the financial
intermediary once it is determined that the Class C or Class CX shares have been
held for the required holding period. It is the financial intermediary’s (and
not the Fund’s) responsibility to keep records and to ensure that the
shareholder is credited with the proper holding period as the Fund and its
agents may not have transparency into how long a shareholder has held Class C or
Class CX shares for purposes of determining whether such Class C or Class CX
shares are eligible to automatically convert pursuant to the Conversion Feature.
In order to determine eligibility for automatic conversion in these
circumstances, it is the responsibility of the shareholder or their financial
intermediary to determine that the shareholder is eligible to exercise the
Conversion Feature, and the shareholder or their financial intermediary may be
required to maintain records that substantiate the holding period of Class C or
Class CX shares.
In
addition, a financial intermediary may sponsor and/or control programs or
platforms that impose a different conversion schedule or eligibility
requirements for conversions of Class C or Class CX shares. In these cases,
Class C and Class CX shares of certain shareholders may not
be eligible
for automatic conversion pursuant to the Conversion Feature as described above.
The Fund has no responsibility for overseeing, monitoring or implementing a
financial intermediary’s process for determining whether a shareholder meets the
required holding period for automatic conversion. Please consult with your
financial intermediary if you have any questions regarding the Conversion
Feature.
Share
Class Conversions Not Permitted
The following
share class conversions are not permitted:
■
Conversions
into Class A from Class A2 of the same Fund.
■
Conversions
into Class A2, Class AX, Class CX, Class P or Class S of the same
Fund.
Rights
Reserved by the Funds
Each Fund and
its agents reserve the right at any time to:
■
Reject or
cancel all or any part of any purchase or exchange order.
■
Modify any
terms or conditions related to the purchase, redemption or exchange of shares of
any Fund.
■
Reject or
cancel any request to establish a Systematic Purchase Plan or Systematic
Redemption Plan.
■
Modify or
terminate any sales charge waivers or exceptions.
■
Suspend,
change or withdraw all or any part of the offering made by this
prospectus.
Excessive
Short-Term Trading Activity (Market Timing) Disclosures
While the
Funds provide their shareholders with daily liquidity, their investment programs
are designed to serve long-term investors and are not designed to accommodate
excessive short-term trading activity in violation of our policies described
below. Excessive short-term trading activity in the Funds’ shares (i.e., a
purchase of Fund shares followed shortly thereafter by a redemption of such
shares, or vice versa) may hurt the long-term performance of certain Funds by
requiring them to maintain an excessive amount of cash or to liquidate portfolio
holdings at a disadvantageous time, thus interfering with the efficient
management of such Funds by causing them to incur increased brokerage and
administrative costs. Where excessive short-term trading activity seeks to take
advantage of arbitrage opportunities from stale prices for portfolio securities,
the value of Fund shares held by long-term investors may be diluted. The Board
has adopted policies and procedures designed to discourage excessive or
short-term trading of Fund shares for all Funds except the money market funds,
Invesco Conservative Income Fund, and Invesco Short Term Municipal Fund.
However, there is the risk that these Funds’ policies and procedures will prove
ineffective in whole or in part to detect or prevent excessive or short-term
trading. These Funds may alter their policies at any time without prior notice
to shareholders if the Adviser believes the change would be in the best
interests of long-term shareholders.
Invesco
and certain of its corporate affiliates (Invesco and such affiliates,
collectively, the Invesco Affiliates) currently use the following tools designed
to discourage excessive short-term trading in the retail Funds:
■
Trade
activity monitoring.
■
Discretion to
reject orders.
■
Purchase
blocking.
■
The use of
fair value pricing consistent with the valuation policy approved by the Board
and related procedures.
Each
of these tools is described in more detail below. Although these tools are
designed to discourage excessive short-term trading, you should understand that
none of these tools alone nor all of them taken together eliminate the
possibility that excessive short-term trading activity in the Funds will occur.
Moreover, each of these tools involves judgments that are inherently subjective.
Invesco Affiliates seek to make these judgments to the best of their abilities
in a manner that they believe is consistent with long-term shareholder
interests.
Money
Market Funds. The Boards
of Invesco Government Money Market Fund, Invesco Premier Portfolio, Invesco
Premier U.S. Government Money Portfolio and Invesco U.S. Government Money
Portfolio (the money market funds) have not adopted any policies and procedures
that would limit frequent purchases and redemptions of such Funds’ shares. The
Boards of
A-18 The
Invesco Funds
the money
market funds considered the risks of not having a specific policy that limits
frequent purchases and redemptions, and determined that those risks were
minimal. Nonetheless, to the extent that a money market fund must maintain
additional cash and/or securities with short-term durations in greater amounts
than may otherwise be required or borrow to honor redemption requests, the money
market fund’s yield could be negatively impacted.
The
Boards of the money market funds do not believe that it is appropriate
to adopt any such policies and procedures for the money market funds for the
following reasons:
■
The money
market funds are offered to investors as cash management vehicles; therefore,
investors should be able to purchase and redeem shares regularly and
frequently.
■
One of the
advantages of a money market fund as compared to other investment options is
liquidity. Any policy that diminishes the liquidity of the money market funds
will be detrimental to the continuing operations of such Funds.
■
With respect
to the money market funds maintaining a constant net asset value, the money
market funds’ portfolio securities are valued on the basis of amortized cost,
and such Funds seek to maintain a constant net asset value. As a result, the
money market funds are not subject to price arbitrage opportunities.
■
With respect
to the money market funds maintaining a constant net asset value, because such
Funds seek to maintain a constant net asset value, investors are more likely to
expect to receive the amount they originally invested in the Funds upon
redemption than other mutual funds.
Invesco
Conservative Income Fund. The Board of
Invesco Conservative Income Fund has not adopted any policies and procedures
that would limit frequent purchases and redemptions of such Fund’s shares. The
Board of Invesco Conservative Income Fund considered the risks of not having a
specific policy that limits frequent purchases and redemptions, and determined
that those risks were minimal especially in light of the reasons for not having
such a policy as described below. Nonetheless, to the extent that the Fund must
maintain additional cash and/or securities with short-term durations in greater
amounts than may otherwise be required or borrow to honor redemption requests,
the Fund’s yield could be negatively impacted.
The
Board of the Invesco Conservative Income Fund does not believe that it is
appropriate to adopt any such policies and procedures for the Fund for the
following reasons:
■
The Fund is
offered to investors as a cash management vehicle; investors perceive an
investment in the Fund as an alternative to cash and must be able to purchase
and redeem shares regularly and frequently.
■
One of the
advantages of the Fund as compared to other investment options is liquidity. Any
policy that diminishes the liquidity of the Fund will be detrimental to the
continuing operations of the Fund.
Excessive
trading activity in the Fund’s shares may cause the Fund to incur
increased brokerage and administrative costs.
The
Fund and its agent reserve the right at any time to reject or cancel
any part of
any purchase order. This could occur if the Fund determines that such purchase
may disrupt the Fund’s operation or performance.
Invesco
Short Term Municipal Fund. The Board
of Invesco Short Term Municipal Fund has not adopted any policies and procedures
that would limit frequent purchases and redemptions of such Fund’s shares. The
Board of Invesco Short Term Municipal Fund considered the risks of not having a
specific policy that limits frequent purchases and redemptions, and determined
that those risks were minimal, especially in light of the reasons for not having
such a policy as described below. Nonetheless, to the extent that the Fund must
maintain additional cash and/or securities with short-term durations in greater
amounts than may otherwise be required or borrow to honor redemption requests,
the Fund’s yield could be negatively impacted.
The
Board of Invesco Short Term Municipal Fund does not believe that it is
appropriate to adopt any such policies and procedures for the Fund for the
following reasons:
■
The Fund is
designed to address the needs of retail investors who seek liquidity in their
investment and seek the ability to purchase and redeem shares at any
time.
■
Any policy
that diminishes the ability of shareholders to purchase and redeem shares of the
Fund will be detrimental to the continuing operations of the Fund.
■
The Fund
generally invests in short duration liquid investment grade municipal
securities.
Excessive
trading activity in the Fund’s shares may cause the Fund to incur
increased brokerage and administrative costs. The Fund and its agent reserve the
right at any time to reject or cancel any part of any purchase order. This could
occur if the Fund determines that such purchase may disrupt the Fund’s operation
or performance.
Trade
Activity Monitoring
Invesco
Affiliates monitor selected trades on a daily basis in an effort to detect
excessive short-term trading activities. If, as a result of this monitoring,
Invesco Affiliates believe that a shareholder has engaged in excessive
short-term trading, they will seek to act in a manner that they believe is
consistent with the best interests of long-term investors, which may include
taking steps such as (i) asking the shareholder to take action to stop such
activities or (ii) refusing to process future purchases or exchanges related to
such activities in the shareholder’s accounts other than exchanges into a money
market fund. Invesco Affiliates will use reasonable efforts to apply the Funds’
policies uniformly given the practical limitations described above.
The
ability of Invesco Affiliates to monitor trades that are made through
accounts that
are maintained by intermediaries (rather than the Funds’ transfer agent) and
through conduit investment vehicles may be limited or non-existent.
Discretion
to Reject Orders
If a Fund or
an Invesco Affiliate determines, in its sole discretion, that your short-term
trading activity is excessive, the Fund may, in its sole discretion, reject any
additional purchase and exchange orders. This discretion may be exercised with
respect to purchase or exchange orders placed directly with the Funds’ transfer
agent or through a financial intermediary.
Purchase
Blocking Policy
The Funds
(except those listed below) have adopted a policy under which any shareholder
redeeming shares having a value of $50,000 or more from a Fund on any trading
day will be precluded from investing in that Fund for 30 calendar days after the
redemption transaction date. The policy applies to redemptions and purchases
that are part of exchange transactions. Under the purchase blocking policy,
certain purchases will not be prevented and certain redemptions will not trigger
a purchase block, such as: purchases and redemptions of shares having a value of
less than $50,000; systematic purchase, redemption and exchange account options;
transfers of shares within the same Fund; non-discretionary rebalancing in
fund-of-funds; asset allocation features; fee-based accounts; account
maintenance fees; small balance account fees; plan-level omnibus Retirement and
Benefit Plans; death and disability and hardship distributions; loan
transactions; transfers of assets; Retirement and Benefit Plan rollovers; IRA
conversions and re-characterizations; and mandatory distributions from
Retirement and Benefit Plans.
The
Funds reserve the right to modify any of the parameters (including those not
listed above) of the purchase blocking policy at any time. Further, the purchase
blocking policy may be waived with respect to specific shareholder accounts in
those instances where the Adviser determines that its surveillance procedures
are adequate to detect frequent trading in Fund shares.
If
an account is maintained by a financial intermediary whose systems are unable to
apply Invesco’s purchase blocking policy, the Adviser will accept the
establishment of an account only if the Adviser believes the policies and
procedures are reasonably designed to enforce the frequent trading policies of
the Funds. You should refer to disclosures provided by the financial
intermediary with which you have an account to determine the specific trading
restrictions that apply to you. If the Adviser identifies any
A-19 The
Invesco Funds
activity that
may constitute frequent trading, it reserves the right to contact the
intermediary and request that the intermediary either provide information
regarding an account owner’s transactions or restrict the account owner’s
trading. There is no guarantee that all instances of frequent trading in Fund
shares will be prevented.
The
purchase blocking policy does not apply to Invesco Conservative Income Fund,
Invesco Short Term Municipal Fund, Invesco Government Money Market Fund, Invesco
Premier Portfolio, Invesco Premier U.S. Government Money Portfolio and Invesco
U.S. Government Money Portfolio.
Pricing
of Shares
Determination
of Net Asset Value
The price of
each Fund’s shares is the Fund’s net asset value per share. The Funds (except
Invesco Government Money Market Fund, Invesco Premier Portfolio, Invesco Premier
U.S. Government Money Portfolio and Invesco U.S. Government Money Portfolio)
value portfolio securities for which market quotations are readily available at
market value. Securities and other assets quoted in foreign currencies are
valued in U.S. dollars based on the prevailing exchange rates on that day. The
Funds (except Invesco Government Money Market Fund, Invesco Premier Portfolio,
Invesco Premier U.S. Government Money Portfolio and Invesco U.S. Government
Money Portfolio) value securities and assets for which market quotations are
unavailable at their “fair value,” which is described below. Invesco Government
Money Market Fund, Invesco Premier Portfolio, Invesco Premier U.S. Government
Money Portfolio and Invesco U.S. Government Money Portfolio value portfolio
securities on the basis of amortized cost, which approximates market value. This
method of valuation is designed to enable a Fund to price its shares at $1.00
per share. The Funds cannot guarantee their net asset value will always remain
at $1.00 per share. Securities and other assets quoted in foreign currencies are
valued in U.S. dollars based on the prevailing exchange rates on that day. The
Fund values securities and assets for which market quotations are unavailable at
their “fair value,” which is described below.
Even
when market quotations are available, they may be stale or not representative
of market value in the Adviser’s judgment (“unreliable”) because the security is
not traded frequently, trading on the security ceased before the close of the
trading market or issuer specific events occurred after the security ceased
trading or because of the passage of time between the close of the market on
which the security trades and the close of the NYSE and when the Fund calculates
its net asset value. Issuer specific events may cause the last market quotation
to be unreliable. Such events may include a merger or insolvency, events that
affect a geographical area or an industry segment, such as political events or
natural disasters, or market events, such as a significant movement in the U.S.
market. Where the Adviser determines that the closing price of the security is
stale or unreliable, the Adviser will value the security at its fair
value.
A
fair value price is an estimated price that requires consideration of all
appropriate
factors, including indications of fair value available from pricing services.
Fair value pricing involves judgment and a Fund that uses fair value
methodologies may value securities higher or lower than another Fund using
market quotations or its own fair value methodologies to price the same
securities. Investors who purchase or redeem Fund shares on days when the Fund
is holding fair-valued securities may receive a greater or lesser number of
shares, or higher or lower redemption proceeds, than they would have received if
the Fund had not fair-valued the security or had used a different
methodology.
The
Board has designated the Adviser to perform the daily determination
of fair value prices in accordance with Board approved policies and related
procedures, subject to the Board’s oversight. Fair value pricing methods and
pricing services can change from time to time.
The
intended effect of applying fair value pricing is to compute an NAV that
accurately reflects the value of a Fund’s portfolio at the time that the NAV is
calculated. An additional intended effect is to discourage those seeking to take
advantage of arbitrage opportunities resulting from “stale” prices and to
mitigate the dilutive impact of any such arbitrage. However, the application of
fair value pricing cannot eliminate the possibility that arbitrage opportunities
will exist.
Specific
types of securities are valued as follows:
Senior
Secured Floating Rate Loans and Senior Secured Floating Rate Debt
Securities. Senior
secured floating rate loans and senior secured floating rate debt securities are
fair valued using evaluated quotes provided by an independent pricing service.
Evaluated quotes provided by the pricing service may reflect appropriate factors
such as market quotes, ratings, tranche type, industry, company performance,
spread, individual trading characteristics, institution-size trading in similar
groups of securities and other market data.
Domestic
Exchange Traded Equity Securities. Market
quotations are generally available and reliable for domestic exchange traded
equity securities. If market quotations are not available or are unreliable, the
Adviser will value the security at fair value in good faith using the valuation
policy approved by the Board and related procedures.
Foreign
Securities. If market
quotations are available and reliable for foreign exchange traded equity
securities, the securities will be valued at the market quotations. Because
trading hours for certain foreign securities end before the close of the NYSE,
closing market quotations may become unreliable. If between the time trading
ends on a particular security and the close of the customary trading session on
the NYSE events occur that are significant and may make the closing price
unreliable, the Fund may fair value the security. If an issuer specific event
has occurred that the Adviser determines, in its judgment, is likely to have
affected the closing price of a foreign security, it will price the security at
fair value. The Adviser also relies on a screening process from a pricing vendor
to indicate the degree of certainty, based on historical data, that the closing
price in the principal market where a foreign security trades is not the current
market value as of the close of the NYSE. For foreign securities where the
Adviser believes, at the approved degree of certainty, that the price is not
reflective of current market value, the Adviser will use the indication of fair
value from the pricing service to determine the fair value of the security. The
pricing vendor, pricing methodology or degree of certainty may change from time
to time.
Fund
securities primarily traded on foreign markets may trade on days that are not
business days of the Fund. Because the net asset value of Fund shares is
determined only on business days of the Fund, the value of the portfolio
securities of a Fund that invests in foreign securities may change on days when
you will not be able to purchase or redeem shares of the Fund.
Fixed
Income Securities. Fixed income
securities, such as government, corporate, asset-backed and municipal bonds,
convertible securities, including high yield or junk bonds, and loans, generally
are valued on the basis of prices provided by independent pricing services.
Prices provided by the pricing services may be determined without exclusive
reliance on quoted prices, and may reflect appropriate factors such as
institution-size trading in similar groups of securities, developments related
to special securities, dividend rate, maturity and other market data. Pricing
services generally value fixed income securities assuming orderly transactions
of institutional round lot size, but a Fund may hold or transact in the same
securities in smaller, odd lot sizes. Odd lots often trade at lower prices than
institutional round lots. Prices received from pricing services are fair value
prices. In addition, if the price provided by the pricing service and
independent quoted prices are unreliable, the Adviser will fair value the
security using the valuation policy approved by the Board and related
procedures.
Short-term
Securities.
The
Funds
(except as
noted
below)
value
variable rate securities that have an unconditional demand or put feature
exercisable within seven days or less at par, which reflects the market value of
such securities. The Funds that operate as government money market or retail
money market funds value all of their securities at amortized cost.
Futures
and Options. Futures
contracts are valued at the final settlement price set by the exchange on which
they are principally traded. Where
a final
settlement price exists, exchange traded options are valued at the final
settlement price from the exchange where the option principally trades.
When
a final
settlement price does not exist, exchange traded options shall be valued at the
mean of the last bid/ask quotation generally from the exchange where the option
principally trades. Options not listed on an exchange and swaps generally are
valued using pricing provided from independent pricing services.
A-20 The
Invesco Funds
Rights
and Warrants. Non-traded
rights and warrants shall be valued at intrinsic value if the terms of the
rights and warrants are available, specifically the subscription or exercise
price and the ratio. Intrinsic value is calculated as the daily market closing
price of the security to be received less the subscription price, which is then
adjusted by the exercise ratio. In the case of warrants, an option pricing model
supplied by an independent pricing service may be used based on market data such
as volatility, stock price and interest rate from the independent pricing
service and strike price and exercise period from verified terms.
Swap
Agreements. Swap
Agreements are fair valued using an evaluated quote provided by a clearing house
or an independent pricing service. Evaluated quotes provided by the pricing
service are based on a model that may include end of day net present values,
spreads, ratings, industry and company performance.
Open-end
Funds. If a Fund
invests in other open-end funds, other than open-end funds that are exchange
traded, the investing Fund will calculate its net asset value using the net
asset value of the underlying fund in which it invests, and the prospectuses for
such open-end funds explain the circumstances under which they will use fair
value pricing and the effects of using fair value pricing.
Each
Fund, except for Invesco Government Money Market Fund, Invesco Premier
Portfolio and Invesco Premier U.S. Government Money Portfolio, generally
determines the net asset value of its shares on each day the NYSE is open for
trading (a business day) as of approximately 4:00 p.m. Eastern Time (the
customary close of regular trading) or earlier in the case of a scheduled early
close. In the event of an unscheduled early close of the NYSE, each Fund, except
for Invesco Government Money Market Fund, Invesco Premier Portfolio and Invesco
Premier U.S. Government Money Portfolio, generally still will determine the net
asset value of its shares as of 4:00 p.m. Eastern Time on that business day.
Portfolio securities traded on the NYSE would be valued at their closing prices
unless the Adviser determines that a “fair value” adjustment is appropriate due
to subsequent events occurring after an early close consistent with the
valuation policy approved by the Board and related procedures. Invesco
Government Money Market Fund, Invesco Premier Portfolio and Invesco Premier
U.S. Government Money Portfolio will generally determine the net asset
value of their shares at 5:30 p.m. Eastern Time on each business day. A
business day for Invesco Government Money Market Fund, Invesco Premier Portfolio
and Invesco Premier U.S. Government Money Portfolio is any day that (1) both the
Federal Reserve Bank of New York and a Fund’s custodian are open for business
and (2) the primary trading markets for the Fund’s portfolio instruments are
open and the Fund’s management believes there is an adequate market to meet
purchase and redemption requests. Invesco Government Money Market Fund, Invesco
Premier Portfolio and Invesco Premier U.S. Government Money Portfolio are
authorized not to open for trading on a day that is otherwise a business day if
the Securities Industry and Financial Markets Association (SIFMA) recommends
that government securities dealers not open for trading; any such day will not
be considered a business day. Invesco Government Money Market Fund, Invesco
Premier Portfolio and Invesco Premier U.S. Government Money Portfolio,
Invesco U.S. Government Money Portfolio also may close early on a business day
if SIFMA recommends that government securities dealers close early. If Invesco
Government Money Market Fund, Invesco Premier Portfolio or Invesco Premier
U.S. Government Money Portfolio uses its discretion to close early on a
business day, the Fund will calculate its net asset value as of the time of such
closing Invesco Premier Portfolio and Invesco U.S. Government Money Portfolio
are authorized to not open for trading on a day that is otherwise a business day
if the NYSE recommends that government securities dealers not open for trading;
any such day will not be considered a business day. Invesco Premier Portfolio
also may close early on a business day if the NYSE recommends that government
securities dealers close early.
For
financial reporting purposes and shareholder transactions on the last day of
the fiscal quarter, transactions are normally accounted for on a trade date
basis. For purposes of executing shareholder transactions in the normal course
of business (other than shareholder transactions at a fiscal period-end), each
Fund’s portfolio securities transactions are recorded no later than the first
business day following the trade date.
The
Invesco Advantage International Fund, Invesco Balanced-Risk Allocation
Fund, Invesco Balanced-Risk Commodity Strategy Fund, Invesco Floating Rate ESG
Fund, Invesco Fundamental Alternatives Fund, Invesco Global Allocation Fund,
Invesco Global Strategic Income Fund, Invesco Gold & Special Minerals Fund,
Invesco International Bond Fund, Invesco Macro Allocation Strategy Fund and
Invesco Senior Floating Rate Fund may each invest up to 25% of their total
assets in shares of their respective subsidiaries (the Subsidiaries). The
Subsidiaries offer to redeem all or a portion of their shares at the current net
asset value per share every regular business day. The value of shares of the
Subsidiaries will fluctuate with the value of the respective Subsidiary’s
portfolio investments. The Subsidiaries price their portfolio investments
pursuant to the same pricing and valuation methodologies and procedures used by
the Funds, which require, among other things, that each of the Subsidiaries’
portfolio investments be marked-to-market (that is, the value on each of the
Subsidiaries’ books changes) each business day to reflect changes in the market
value of the investment.
Each
Fund’s current net asset value per share is made available on the Funds’
website at www.invesco.com/us.
Fair
Value Pricing
Securities
owned by a Fund (except Invesco Government Money Market Fund, Invesco Premier
Portfolio, Invesco Premier U.S. Government Money Portfolio and Invesco U.S.
Government Money Portfolio) are to be valued at current market value if market
quotations are readily available. All other securities and assets of a Fund for
which market quotations are not readily available are to be valued at fair value
determined in good faith consistent with the valuation policy approved by the
Board and related procedures. An effect of fair value pricing may be to reduce
the ability of frequent traders to take advantage of arbitrage opportunities
resulting from potentially “stale” prices of portfolio holdings. However, it
cannot eliminate the possibility of frequent trading.
The
price a Fund could receive upon the sale of any investment may differ from
the Adviser's valuation of the investment, particularly for securities that are
valued using a fair valuation technique. When fair valuation techniques are
applied, the Adviser uses available information, including both observable and
unobservable inputs and assumptions (i.e., publicly traded company multiples,
growth rate, time to exit), to determine a methodology that will result in a
valuation that the Adviser believes approximates market value. Fund securities
that are fair valued may be subject to greater fluctuation in their value from
one day to the next than would be the case if market quotations were used.
Because of the inherent uncertainties of valuation, and the degree of
subjectivity in such decisions, the Fund could realize a greater or lesser than
expected gain or loss upon the sale of the investment.
Timing
of Orders
Each Fund
prices purchase, exchange and redemption orders at the net asset value next
calculated by the Fund after the Fund’s transfer agent, authorized agent or
designee receives an order in good order for the Fund. Purchase, exchange and
redemption orders must be received prior to the close of business on a business
day, as defined by the applicable Fund, to receive that day’s net asset value.
Any applicable sales charges are applied at the time an order is
processed.
Currently,
certain financial intermediaries may serve as agents for the Funds and
accept orders on their behalf. Where a financial intermediary serves as agent,
the order is priced at the Fund’s net asset value next calculated after it is
accepted by the financial intermediary. In such cases, if requested by a Fund,
the financial intermediary is responsible for providing information with regard
to the time that such order for purchase, redemption or exchange was received.
Orders submitted through a financial intermediary that has not received
authorization to accept orders on a Fund’s behalf are priced at the Fund’s net
asset value next calculated by the Fund after it receives the order from the
financial intermediary and accepts it, which may not occur on the day submitted
to the financial intermediary.
A-21 The
Invesco Funds
Additional
Information Regarding Deferred Tax Liability (only applicable to the Invesco
Steelpath Funds)
In
calculating the Fund’s daily NAV, the Fund will, among other things, account for
its deferred tax liability and/or asset balances. As a result, any deferred tax
liability and/or asset is reflected in the Fund’s daily NAV.
The
Fund will accrue a deferred income tax liability balance, at the U.S.
federal
corporate income tax rate plus an estimated state and local income tax rate for
its future tax liability associated with MLP distributions considered to be a
return of capital, as well as for its future tax liability associated with the
capital appreciation of its investments. The Fund’s current and deferred tax
liability, if any, will depend upon the Fund’s net investment gains and losses
and realized and unrealized gains and losses on investments and therefore may
vary greatly from year to year depending on the nature of the Fund’s
investments, the performance of those investments and general market conditions.
Any deferred tax liability balance will reduce the Fund’s NAV. Upon the Fund’s
sale of an MLP security, the Fund may be liable for previously deferred
taxes.
The
Fund will accrue, in accordance with generally accepted accounting principles, a
deferred tax asset balance, which reflects an estimate of the Fund’s future tax
benefit associated with net operating losses and unrealized losses. Any deferred
tax asset balance will increase the Fund’s NAV. To the extent the Fund has a
deferred tax asset balance, the Fund will assess, in accordance with generally
accepted accounting principles, whether a valuation allowance, which would
offset the value of the Fund’s deferred tax asset balance, is required. Pursuant
to Financial Accounting Standards Board Accounting Standards Codification 740
(FASB ASC 740), the Fund will assess a valuation allowance to reduce the
deferred tax asset balance if, based on the weight of all available evidence,
both negative and positive, it is more likely than not that the deferred tax
asset balance will not be realized. The Fund will use judgment in considering
the relative impact of negative and positive evidence. The weight given to the
potential effect of negative and positive evidence will be commensurate with the
extent to which such evidence can be objectively verified. The Fund’s assessment
considers, among other matters, the nature, frequency and severity of current
and cumulative losses, the duration of statutory carry forward periods and the
associated risk that operating loss and capital loss carry forwards may be
limited or expire unused, and unrealized gains and losses on investments.
Consideration is also given to market cycles, the severity and duration of
historical deferred tax assets, the impact of redemptions, and the level of MLP
distributions. The Fund will assess whether a valuation allowance is required to
offset any deferred tax asset balance in connection with the calculation of the
Fund’s NAV per share each day; however, to the extent the final valuation
allowance differs from the estimates the Fund used in calculating the Fund’s
daily NAV, the application of such final valuation allowance could have a
material impact on the Fund’s NAV.
The
Fund’s deferred tax asset and/or liability balances are estimated using
estimates of effective tax rates expected to apply to taxable income in the
years such balances are realized. The Fund will rely to some extent on
information provided by MLPs in determining the extent to which distributions
received from MLPs constitute a return of capital, which may not be provided to
the Fund on a timely basis, to estimate the Fund’s deferred tax liability and/or
asset balances for purposes of financial statement reporting and determining its
NAV. If such information is not received from such MLPs on a timely basis, the
Fund will estimate the extent to which distributions received from MLPs
constitute a return of capital based on average historical tax characterization
of distributions made by MLPs. The Fund’s estimates regarding its deferred tax
liability and/or asset balances are made in good faith; however, the daily
estimate of the Fund’s deferred tax liability and/or asset balances used to
calculate the Fund’s NAV could vary dramatically from the Fund’s actual tax
liability. Actual income tax expense, if any, will be incurred over many years,
depending on if and when investment gains and losses are realized, the
then-current basis of the Fund’s assets and other factors. As a result, the
determination of the Fund’s actual tax liability may have a material impact on
the Fund’s NAV. The Fund’s daily NAV calculation will be based on then current
estimates and assumptions regarding the Fund’s deferred tax
liability
and/or asset balances and any applicable valuation allowance, based on all
information available to the Fund at such time. From time to time, the Fund may
modify its estimates or assumptions regarding its deferred tax liability and/or
asset balances and any applicable valuation allowance as new information becomes
available. Modifications of the Fund’s estimates or assumptions regarding its
deferred tax liability and/or asset balances and any applicable valuation
allowance, changes in generally accepted accounting principles or related
guidance or interpretations thereof, limitations imposed on net operating losses
(if any) and changes in applicable tax law could result in increases or
decreases in the Fund’s NAV per share, which could be material.
Taxes
(applicable to all Funds except for the Invesco SteelPath Funds)
A Fund
intends to qualify each year as a regulated investment company (RIC) and, as
such, is not subject to entity-level tax on the income and gain it distributes
to shareholders. If you are a taxable investor, dividends and distributions you
receive from a Fund generally are taxable to you whether you reinvest
distributions in additional Fund shares or take them in cash. Every year, you
will be sent information showing the amount of dividends and distributions you
received from a Fund during the prior calendar year. In addition, investors in
taxable accounts should be aware of the following basic tax points as
supplemented below where relevant:
Fund Tax
Basics
■
A Fund earns
income generally in the form of dividends or interest on its investments. This
income, less expenses incurred in the operation of a Fund, constitutes the
Fund’s net investment income from which dividends may be paid to you. If you are
a taxable investor, distributions of net investment income generally are taxable
to you as ordinary income.
■
Distributions
of net short-term capital gains are taxable to you as ordinary income. A Fund
with a high portfolio turnover rate (a measure of how frequently assets within a
Fund are bought and sold) is more likely to generate short-term capital gains
than a Fund with a low portfolio turnover rate.
■
Distributions
of net long-term capital gains are taxable to you as long-term capital gains no
matter how long you have owned your Fund shares.
■
A portion of
income dividends paid by a Fund to you may be reported as qualified dividend
income eligible for taxation by individual shareholders at long-term capital
gain rates, provided certain holding period requirements are met. These reduced
rates generally are available for dividends derived from a Fund’s investment in
stocks of domestic corporations and qualified foreign corporations. In the case
of a Fund that invests primarily in debt securities, either none or only a
nominal portion of the dividends paid by the Fund will be eligible for taxation
at these reduced rates.
■
The use of
derivatives by a Fund may cause the Fund to realize higher amounts of ordinary
income or short-term capital gain, distributions from which are taxable to
individual shareholders at ordinary income tax rates rather than at the more
favorable tax rates for long-term capital gain.
■
Distributions
declared to shareholders with a record date in October, November or December—if
paid to you by the end of January—are taxable for federal income tax purposes as
if received in December.
■
Any long-term
or short-term capital gains realized on the sale or redemption of your Fund
shares will be subject to federal income tax. For tax purposes an exchange of
your shares for shares of another Fund is the same as a sale. An exchange occurs
when the purchase of shares of a Fund is made using the proceeds from a
redemption of shares of another Fund and is effectuated on the same day as the
redemption. Your gain or loss is calculated by subtracting from the gross
proceeds your cost basis. Gross proceeds and, for shares acquired on or after
January 1, 2012 and disposed of after that date, cost basis will be
reported to you and the Internal Revenue Service (IRS). Cost basis will be
calculated using the Fund’s default method of average cost, unless you instruct
the Fund to use a different calculation method. As a service to you, the Fund
will continue to provide to you (but not the IRS) cost basis information for
shares acquired before 2012, when available, using the average cost method.
Shareholders should carefully review the cost basis
A-22 The
Invesco Funds
information
provided by a Fund and make any additional basis, holding period or other
adjustments that are required when reporting these amounts on their federal
income tax returns. If you hold your Fund shares through a broker (or other
nominee), please contact that broker (nominee) with respect to reporting of cost
basis and available elections for your account. For more information about the
cost basis methods offered by Invesco, please refer to the Tax Center located
under the Account Access & Forms menu of our website at
www.Invesco.com/us.
■
The
conversion of shares of one class of a Fund into shares of another class of the
same Fund is not taxable for federal income tax purposes and no gain or loss
will be reported on the transaction. This is true whether the conversion occurs
automatically pursuant to the terms of the class or is initiated by the
shareholder.
■
At the time
you purchase your Fund shares, the Fund’s net asset value may reflect
undistributed income or undistributed capital gains. A subsequent distribution
to you of such amounts, although constituting a return of your investment, would
be taxable. Buying shares in a Fund just before it declares an income dividend
or capital gains distribution is sometimes known as “buying a dividend.” In
addition, a Fund’s net asset value may, at any time, reflect net unrealized
appreciation, which may result in future taxable distributions to
you.
■
By law, if
you do not provide a Fund with your proper taxpayer identification number and
certain required certifications, you may be subject to backup withholding on any
distributions of income, capital gains, or proceeds from the sale of your
shares. A Fund also must withhold if the IRS instructs it to do so. When
withholding is required, the amount will be 24% of any distributions or proceeds
paid.
■
An additional
3.8% Medicare tax is imposed on certain net investment income (including
ordinary dividends and capital gain distributions received from a Fund and net
gains from redemptions or other taxable dispositions of Fund shares) of U.S.
individuals, estates and trusts to the extent that such person’s “modified
adjusted gross income” (in the case of an individual) or “adjusted gross income”
(in the case of an estate or trust) exceeds a threshold amount. This Medicare
tax, if applicable, is reported by you on, and paid with, your federal income
tax return.
■
You will not
be required to include the portion of dividends paid by a Fund derived from
interest on U.S. government obligations in your gross income for purposes
of personal and, in some cases, corporate income taxes in many state and local
tax jurisdictions. The percentage of dividends that constitutes dividends
derived from interest on federal obligations will be determined annually. This
percentage may differ from the actual percentage of interest received by the
Fund on federal obligations for the particular days on which you hold
shares.
■
Fund
distributions and gains from sale or exchange of your Fund shares generally are
subject to state and local income taxes.
■
If a Fund
qualifies to pass through to you the tax benefits from foreign taxes it pays on
its investments, and elects to do so, then any foreign taxes it pays on these
investments may be passed through to you. You will then be required to include
your pro-rata share of these taxes in gross income, even though not actually
received by you, and will be entitled either to deduct your share of these taxes
in computing your taxable income, or to claim a foreign tax credit for these
taxes against your U.S. federal income tax.
■
Foreign
investors should be aware that U.S. withholding, special certification
requirements to avoid U.S. backup withholding and claim any treaty
benefits, and estate taxes may apply to an investment in a Fund.
■
Under the
Foreign Account Tax Compliance Act (FATCA), a Fund will be required to withhold
a 30% tax on income dividends made by the Fund to certain foreign entities,
referred to as foreign financial institutions or non-financial foreign entities,
that fail to comply (or be deemed compliant) with extensive reporting and
withholding requirements designed to inform the U.S. Department of the Treasury
of U.S.-owned foreign investment accounts. After December 31, 2018, FATCA
withholding also would have applied to certain capital gain distributions,
return of capital distributions and the proceeds arising from the sale of Fund
shares; however, based on proposed regulations issued by the IRS, which can be
relied upon currently, such withholding is no longer required unless final
regulations
provide
otherwise (which is not expected). A Fund may disclose the information that it
receives from its shareholders to the IRS, non-U.S. taxing authorities or other
parties as necessary to comply with FATCA or similar laws. Withholding also may
be required if a foreign entity that is a shareholder of a Fund fails to provide
the Fund with appropriate certifications or other documentation concerning its
status under FATCA.
■
If a Fund
invests in an underlying fund taxed as a RIC, please see any relevant section
below for more information regarding the Fund’s investment in such underlying
fund.
The above
discussion concerning the taxability of Fund dividends and distributions and of
redemptions and exchanges of Fund shares is inapplicable to investors holding
shares through a tax-advantaged arrangement, such as Retirement and Benefit
Plans or 529 college savings plans. Such investors should refer to the
applicable account documents/program description for that arrangement for more
information regarding the tax consequences of holding and redeeming Fund
shares.
Funds
Investing in Municipal Securities
■
You will not
be required to include the “exempt-interest” portion of dividends paid by the
Fund in either your gross income for federal income tax purposes or your net
investment income subject to the additional 3.8% Medicare tax. You will be
required to report the receipt of exempt-interest dividends and other tax-exempt
interest on your federal income tax returns. The percentage of dividends that
constitutes exempt-interest dividends will be determined annually. This
percentage may differ from the actual percentage of exempt interest received by
the Fund for the particular days in which you hold shares.
■
A Fund may
invest in municipal securities the interest on which constitutes an item of tax
preference and could give rise to a federal alternative minimum tax liability
for noncorporate shareholders, unless such municipal securities were issued in
2009 or 2010.
■
Exempt-interest
dividends from interest earned on municipal securities of a state, or its
political subdivisions, generally are exempt from that state’s personal income
tax. Most states, however, do not grant tax-free treatment to interest from
municipal securities of other states.
■
A Fund may
invest a portion of its assets in securities that pay income that is not
tax-exempt. To the extent that dividends paid by a Fund are derived from taxable
investments or realized capital gains, they will be taxable as ordinary income
or long-term capital gains.
■
A Fund may
distribute to you any market discount and net short-term capital gains from the
sale of its portfolio securities. If you are a taxable investor, Fund
distributions from this income are taxable to you as ordinary income, and
generally will neither qualify for the dividends-received deduction in the case
of corporate shareholders nor as qualified dividend income subject to reduced
rates of taxation in the case of noncorporate shareholders.
■
Exempt-interest
dividends from a Fund are taken into account when determining the taxable
portion of your social security or railroad retirement benefits, may be subject
to state and local income taxes, may affect the deductibility of interest on
certain indebtedness, and may have other collateral federal income tax
consequences for you.
■
There are
risks that: (a) a security issued as tax-exempt may be reclassified by the IRS
or a state tax authority as taxable and/or (b) future legislative,
administrative or court actions could adversely impact the qualification of
income from a tax-exempt security as tax-free. Such reclassifications or actions
could cause interest from a security to become taxable, possibly retroactively,
subjecting you to increased tax liability. In addition, such reclassifications
or actions could cause the value of a security, and therefore, the value of the
Fund’s shares, to decline.
Money
Market Funds
■
A Fund does
not anticipate realizing any long-term capital gains.
■
If a Fund
expects to maintain a stable net asset value of $1.00 per share, investors
should not have any gain or loss on sale or exchange of Fund shares (unless the
investor incurs a liquidity fee on such sale or exchange). See “Liquidity
Fees.”
A-23 The
Invesco Funds
■
There is some
degree of uncertainty with respect to the tax treatment of liquidity fees
received by a Fund, and such tax treatment may be the subject of future IRS
guidance. If a Fund receives liquidity fees, it will consider the appropriate
tax treatment of such fees to the Fund at such time.
■
Unless you
choose to adopt a simplified “NAV method” of accounting (described below), any
capital gain or loss on the sale or exchange of Fund shares (as noted above)
generally will be treated either as short-term if you held your Fund shares for
one year or less, or long-term if you held your Fund shares longer. If you elect
to adopt the NAV method of accounting, rather than computing gain or loss on
every taxable disposition of Fund shares as described above, you would determine
your gain or loss based on the change in the aggregate value of your Fund shares
during a computation period (such as your taxable year), reduced by your net
investment (purchases minus sales) in those shares during that period. Under the
NAV method, any resulting net capital gain or loss would be treated as
short-term capital gain or loss.
Funds
Investing in Real Estate Securities
■
Because of
“noncash” expenses such as property depreciation, the cash flow of a REIT that
owns properties will exceed its taxable income. The REIT, and in turn a Fund,
may distribute this excess cash to shareholders. Such a distribution is
classified as a return of capital. Return of capital distributions generally are
not taxable to you. Your cost basis in your Fund shares will be decreased by the
amount of any return of capital. Any return of capital distributions in excess
of your cost basis will be treated as capital gains.
■
Dividends
paid to shareholders from the Funds’ investments in U.S. REITs generally will
not qualify for taxation at long-term capital gain rates applicable to qualified
dividend income.
■
The Fund may
derive “excess inclusion income” from certain equity interests in mortgage
pooling vehicles either directly or through an investment in a U.S. REIT. Please
see the SAI for a discussion of the risks and special tax consequences to
shareholders in the event the Fund realizes excess inclusion income in excess of
certain threshold amounts.
■
Under the Tax
Cuts and Jobs Act, “qualified REIT dividends” (i.e., ordinary REIT dividends
other than capital gain dividends and portions of REIT dividends designated as
qualified dividend income) are treated as eligible for a 20% deduction by
noncorporate taxpayers. The Fund may choose to report the special character of
“qualified REIT dividends” to a shareholder, provided both the Fund and a
shareholder meet certain holding period requirements with respect to their
shares.
■
The Fund’s
foreign shareholders should see the SAI for a discussion of the risks and
special tax consequences to them from a sale of a U.S. real property interest by
a REIT in which the Fund invests.
Funds
Investing in Partnerships
■
Taxes,
penalties,
and interest associated with an audit of a partnership are generally required to
be assessed and collected at the partnership level. Therefore, an adverse
federal income tax audit of a partnership that a Fund invests in (including MLPs
taxed as partnerships) could result in the Fund being required to pay federal
income tax. A Fund may have little input in any audit asserted against a
partnership and may be contractually or legally obligated to make payments in
regard to deficiencies asserted without the ability to put forward an
independent defense. Accordingly, even if a partnership in which the Fund
invests were to remain classified as a partnership (instead of as a
corporation), it could be required to pay additional taxes, interest and
penalties as a result of an audit adjustment, and the Fund, as a direct or
indirect partner of such partnership, could be required to bear the economic
burden of those taxes, interest and penalties, which would reduce the value of
Fund shares.
■
Under the Tax
Cuts and Jobs Act “qualified publicly traded partnership income” is treated as
eligible for a 20% deduction by noncorporate taxpayers. The legislation does not
contain a provision permitting a RIC, such as a Fund, to pass the special
character of this income through to its shareholders. It is uncertain whether a
future technical corrections bill or
regulations
issued by the IRS will address this issue to enable a Fund to pass through the
special character of “qualified publicly traded partnership income” to its
shareholders.
■
Some amounts
received by a Fund from the MLPs in which it invests likely will be treated as
returns of capital to such Fund because of accelerated deductions available to
the MLPs. The receipt of returns of capital from the MLPs in which a Fund
invests could cause some or all of the Fund’s distributions to be classified as
a return of capital. Return of capital distributions generally are not taxable
to you. Your cost basis in your Fund shares will be decreased by the amount of
any return of capital. Any return of capital distributions in excess of your
cost basis will be treated as capital gains.
Funds
Investing in Commodities
■
The Funds’
strategies of investing through their respective Subsidiary in derivatives and
other financially linked instruments whose performance is expected to correspond
to the commodity markets may cause the Funds to recognize more ordinary income
and short-term capital gains taxable as ordinary income than would be the case
if the Funds invested directly in commodities.
■
The Funds
must meet certain requirements under the Code for favorable tax treatment as a
RIC, including asset diversification and income requirements. The IRS has issued
a revenue ruling which holds that income derived from commodity-linked swaps is
not qualifying income for purposes of the Income Requirement. In a subsequent
revenue ruling, as well as in a number of follow-on private letter rulings (upon
which only the fund that received the private letter ruling may rely), the IRS
provides that income from certain alternative investments which create commodity
exposure, such as certain commodity-linked or structured notes or a corporate
subsidiary that invests in commodities, may be considered qualifying income
under the Code. However, the portion of such rulings relating to the treatment
of a corporation as a regulated investment company that require a determination
of whether a financial instrument or position is a security under section
2(a)(36) of the 1940 Act was revoked because of changes in the IRS’s position.
(A financial instrument or position that constitutes a security under section
2(a)(36) of the 1940 Act generates qualifying income for a corporation taxed as
a regulated investment company.) The Funds intend to treat the income each
derives from commodity-linked notes as qualifying income based on an opinion
from counsel confirming that income from such investments should be qualifying
income because such commodity-linked notes constitute securities under section
2(a)(36) of the 1940 Act. Each Subsidiary will be classified for federal income
tax purposes as a controlled foreign corporation (CFC) with respect to the Fund.
As such, the Fund will be required to include in its gross income each year
amounts earned by the Subsidiary during that year (“Subpart F” income), whether
or not such earnings are distributed by the Subsidiary to the Fund (deemed
inclusions). Treasury Regulations also permit the Fund to treat such deemed
inclusions of “Subpart F” income from the Subsidiary as qualifying income to the
Fund, even if the Subsidiary does not make a distribution of such income.
Consequently, the Fund and the Subsidiary reserve the right to rely on deemed
inclusions being treated as qualifying income to the Fund consistent with
Treasury Regulations. If, contrary to the opinion of counsel or other guidance
issued by the IRS, the IRS were to determine that income from direct investment
in commodity-linked notes is non-qualifying, a Fund might fail to satisfy the
income requirement. In lieu of disqualification, the Funds are permitted to pay
a tax for certain failures to satisfy the asset diversification or income
requirements, which, in general, are limited to those due to reasonable cause
and not willful neglect. The Funds intend to limit their investments in their
respective Subsidiary to no more than 25% of the value of each Fund’s total
assets in order to satisfy the asset diversification requirement.
Funds
Investing in Foreign Currencies
■
The Funds may
realize gains from the sale or other disposition of foreign currencies
(including but not limited to gains from options, futures or forward contracts)
derived from investing in securities or foreign
A-24 The
Invesco Funds
currencies.
The U.S. Treasury Department is authorized to issue regulations on whether the
realization of such foreign currency gains is qualified income for the Funds. If
such regulations are issued, each Fund may not qualify as a RIC and/or the Fund
may change its investment policy. As of the date of this prospectus, no
regulations have been issued pursuant to this authorization. It is possible,
however, that such regulations may be issued in the future. Additionally, the
IRS has not issued any guidance on how to apply the asset diversification test
to such foreign currency positions. Thus, the IRS’ determination as to how to
treat such foreign currency positions for purposes of satisfying the asset
diversification test might differ from that of each Fund resulting in the Fund’s
failure to qualify as a RIC. In lieu of disqualification, each Fund is permitted
to pay a tax for certain failures to satisfy the asset diversification or income
requirements, which, in general, are limited to those due to reasonable cause
and not willful neglect.
■
The Funds’
transactions in foreign currencies may give rise to ordinary income or loss to
the extent such income or loss results from fluctuations in the value of the
foreign currency concerned. This treatment could increase or decrease the Funds'
ordinary income distributions to you, and may cause some or all of the Funds'
previously distributed income to be classified as a return of capital. Return of
capital distributions generally are not taxable to you. Your cost basis in your
Fund shares will be decreased by the amount of any return of capital. Any return
of capital distributions in excess of your cost basis will be treated as capital
gains.
This
discussion of “Taxes” is for general information only and not
tax advice. All investors should consult their own tax advisers as to the
federal, state, local and foreign tax provisions applicable to
them.
Taxes
(applicable to the Invesco SteelPath Funds only)
Although the
Code generally provides that a RIC does not pay an entity-level income tax,
provided that it distributes all or substantially all of its income, the Fund is
not and does not anticipate becoming eligible to elect to be treated as a RIC
because most or substantially all of the Fund’s investments will consist of
investments in MLP securities. The RIC tax rules therefore have no application
to the Fund or to its shareholders. As a result, the Fund is treated as a
regular corporation, or “C” corporation, for U.S. federal income tax purposes,
and generally is subject to U.S. federal income tax on its taxable income at the
corporate income tax rate. In addition, as a regular corporation, the Fund will
be subject to state and local taxes by reason of its tax status and its
investments in MLPs. Therefore, the Fund may have to pay federal, multiple
state, and local taxes, which would reduce the Fund’s cash available to make
distributions to shareholders. An estimate for federal, state, and local tax
liabilities will reduce the fund’s net asset value. The extent to which the Fund
is required to pay U.S. federal, state or local corporate income, franchise or
other corporate taxes could materially reduce the Fund’s cash available to make
distributions to shareholders. In addition, investors in taxable accounts should
be aware of the following basic tax points as supplemented below where
relevant:
Fund
Tax Basics
■
The Fund
intends to invest a significant portion of its assets in MLPs, which are
generally treated as partnerships for U.S. federal income tax purposes. To the
extent that the Fund invests in equity securities of an MLP, the Fund will be a
partner in such MLP. Accordingly, the Fund will be required to take into account
the Fund’s allocable share of the income, gains, losses, deductions, and credits
recognized by each such MLP, regardless of whether the MLP distributes cash to
the Fund. MLP distributions to partners, such as the Fund, are not taxable
unless the cash amount (or in certain cases, the fair market value of marketable
securities) distributed exceeds the Fund’s basis in its MLP interest. The Fund
expects that the cash distributions it will receive with respect to its
investments in equity securities of MLPs will exceed the net taxable income
allocated to the Fund from such MLPs because of tax deductions such as
depreciation, amortization and depletion that will be allocated to the Fund from
the MLPs. No assurance, however, can be given in this
regard. If
this expectation is not realized, the Fund will have a larger corporate income
tax expense than expected, which will result in less cash available for
distribution to shareholders.
■
A federal
excise tax on stock repurchases is expected to apply to the Fund with respect to
share redemptions occurring on or after January 1, 2023, in accordance with the
provisions of the Inflation Reduction Act of 2022. The excise tax is 1% of the
fair market value of Fund share redemptions less the fair market value of Fund
share issuances (in excess of $1 million of fair market value) annually on a
taxable year basis.
■
The Fund will
recognize gain or loss on the sale, exchange or other taxable disposition of its
portfolio assets, including equity securities of MLPs, equal to the difference
between the amount realized by the Fund on the sale, exchange or other taxable
disposition and the Fund’s adjusted tax basis in such assets. Any such gain will
be subject to U.S. federal income tax at the corporate income tax rate,
regardless of how long the Fund has held such assets since preferential capital
gain rates do not apply to regular corporations such as the Fund. The amount
realized by the Fund in any case generally will be the amount paid by the
purchaser of the assets plus, in the case of MLP equity securities, the Fund’s
allocable share, if any, of the MLP’s debt that will be allocated to the
purchaser as a result of the sale, exchange or other taxable disposition. The
Fund’s tax basis in its equity securities in an MLP generally is equal to the
amount the Fund paid for the equity securities, (i) increased by the Fund’s
allocable share of the MLP’s net taxable income and certain MLP debt, if any,
and (ii) decreased by the Fund’s allocable share of the MLP’s net losses and any
distributions received by the Fund from the MLP. Although any distribution by an
MLP to the Fund in excess of the Fund’s allocable share of such MLP’s net
taxable income may create a temporary economic benefit to the Fund, net of a
deferred tax liability, such distribution will decrease the Fund’s tax basis in
its MLP investment and will therefore increase the amount of gain (or decrease
the amount of loss) that will be recognized on the sale of an equity security in
the MLP by the Fund. To the extent that the Fund has a net capital loss in any
year, the net capital loss can be carried back three taxable years and forward
five taxable years to reduce the Fund’s capital gains in such years. In the
event a capital loss carryover cannot be utilized in the carryover periods, the
Fund’s federal income tax liability may be higher than expected, which will
result in less cash available to distribute to shareholders.
■
Distributions
by the Fund of cash or property in respect of the shares (other than certain
distributions in redemption of shares) will be treated as dividends for U.S.
federal income tax purposes to the extent paid from the Fund’s current or
accumulated earnings and profits (as determined under U.S. federal income tax
principles). Generally, the Fund’s earnings and profits are computed based upon
the Fund’s taxable income (loss), with certain specified adjustments. Any such
dividend likely will be eligible for the dividends-received deduction if
received by an otherwise qualifying corporate U.S. shareholder that meets
certain holding period and other requirements for the dividends-received
deduction. Dividends paid by the Fund to certain non-corporate U.S. shareholders
(including individuals), generally are eligible for U.S. federal income taxation
at the rates generally applicable to long-term capital gains for individuals
provided that the U.S. shareholder receiving the dividend satisfies applicable
holding period and other requirements. Otherwise, dividends paid by the Fund to
non-corporate U.S. Shareholders (including individuals) will be taxable at
ordinary income rates.
■
If the amount
of a Fund distribution exceeds the Fund’s current and accumulated earnings and
profits, such excess will be treated first as a tax-deferred return of capital
to the extent of, and in reduction of, a shareholder’s tax basis in the shares,
and thereafter as capital gain to the extent the shareholder held the shares as
a capital asset. Any such capital gain will be long-term capital gain if such
shareholder has held the applicable shares for more than one year. The portion
of the distribution received by a shareholder from the Fund that is treated as a
return of capital will decrease the shareholder’s tax basis in his or her Fund
shares (but not below zero), which will result in an increase in the amount of
gain (or decrease in the amount of loss) that will be recognized by the
shareholder for tax purposes on the later sale of such Fund shares.
A-25 The
Invesco Funds
■
The Fund
anticipates that the cash distributions it will receive with respect to its
investments in equity securities of MLPs and which it will distribute to its
shareholders will exceed the Fund’s current and accumulated earnings and
profits. Accordingly, the Fund expects that only a part of its distributions to
shareholders with respect to the shares will be treated as dividends for U.S.
federal income tax purposes. No assurance, however, can be given in this
regard.
■
Special rules
may apply to the calculation of the Fund’s earnings and profits. For example,
the Fund’s earnings and profits will be calculated using the straight-line
depreciation method rather than the accelerated depreciation method. This
difference in treatment may, for example, result in the Fund’s earnings and
profits being higher than the Fund’s taxable income or loss in a particular year
if the MLPs in which the Fund invests calculate their income using accelerated
depreciation. Because of these special earnings profits rules, the Fund may make
distributions in a particular year out of earnings and profits (treated as
dividends) in excess of the amount of the Fund’s taxable income or loss for such
year, which means that a larger percentage of the Fund ’s distributions could be
taxable to shareholders as ordinary income instead of tax-deferred return of
capital or capital gain.
■
Shareholders
that receive distributions in shares rather than in cash will be treated for
U.S. federal income tax purposes as having (i) received a cash distribution
equal to the fair market value of the shares received and (ii) reinvested such
amount in shares.
■
A redemption
of shares will be treated as a sale or exchange of such shares, provided the
redemption is not essentially equivalent to a dividend, is a substantially
disproportionate redemption, is a complete redemption of a shareholder’s entire
interest in the Fund, or is in partial liquidation of such Fund. Redemptions
that do not qualify for sale or exchange treatment will be treated as
distributions as described above. Upon a redemption treated as a sale or
exchange under these rules, a shareholder generally will recognize capital gain
or loss equal to the difference between the adjusted tax basis of his or her
shares and the amount received when they are sold.
■
If the Fund
is required to sell portfolio securities to meet redemption requests, the Fund
may recognize income and gains for U.S. federal, state and local income and
other tax purposes, which may result in the imposition of corporate income or
other taxes on the Fund and may increase the Fund’s current and accumulated
earnings and profits, which will result in a greater portion of distributions to
Fund shareholders being treated as dividends. Any long-term or short-term
capital gains realized on sale or redemption of your Fund shares will be subject
to federal income tax. For tax purposes an exchange of your shares for shares of
another Fund is the same as a sale. An exchange occurs when the purchase of
shares of a Fund is made using the proceeds from a redemption of shares of
another Fund and is effectuated on the same day as the redemption. Your gain or
loss is calculated by subtracting from the gross proceeds your cost basis. Gross
proceeds and, for shares acquired on or after January 1, 2012 and disposed of
after that date, cost basis will be reported to you and the IRS. Cost basis will
be calculated using the Fund’s default method of first-in, first-out (FIFO),
unless you instruct the Fund to use a different calculation method. Shareholders
should carefully review the cost basis information provided by a Fund and make
any additional basis, holding period or other adjustments that are required when
reporting these amounts on their federal income tax returns. If you hold your
Fund shares through a broker (or other nominee), please contact that broker
(nominee) with respect to reporting of cost basis and available elections for
your account. For more information about the cost basis methods offered by
Invesco, please refer to the Tax Center located under the Account Access &
Forms menu of our website at www.invesco.com/us.
■
The
conversion of shares of one class of a Fund into shares of another class of the
same Fund is not taxable for federal income tax purposes and no gain or loss
will be reported on the transaction. This is true whether the conversion occurs
automatically pursuant to the terms of the class or is initiated by the
shareholder.
■
At the time
you purchase your Fund shares, the Fund’s net asset value may reflect
undistributed income. A subsequent distribution to you of such amounts, although
constituting a return of your investment, would be taxable. Buying shares in a
Fund just before it declares an income dividend is sometimes known as “buying a
dividend.” In addition, a Fund’s net asset value may, at any time, reflect net
unrealized appreciation, which may result in future taxable distributions to
you.
■
By law, if
you do not provide a Fund with your proper taxpayer identification number and
certain required certifications, you may be subject to backup withholding on any
distributions of income, capital gains, or proceeds from the sale of your
shares. A Fund also must withhold if the IRS instructs it to do so. When
withholding is required, the amount will be 24% of any distributions or proceeds
paid.
■
A 3.8%
Medicare tax is imposed on certain net investment income (including ordinary
dividends received from a Fund and net gains from redemptions or other taxable
dispositions of Fund shares) of U.S. individuals, estates and trusts to the
extent that such person’s “modified adjusted gross income” (in the case of an
individual) or “adjusted gross income” (in the case of an estate or trust)
exceeds a threshold amount. This Medicare tax, if applicable, is reported by you
on, and paid with, your federal income tax return.
■
Fund
distributions and gains from sale or exchange of your Fund shares generally are
subject to state and local income taxes.
■
Foreign
investors should be aware that U.S. withholding, special certification
requirements to avoid U.S. backup withholding and claim any treaty benefits, and
estate taxes may apply to an investment in a Fund.
■
Under the
Foreign Account Tax Compliance Act (FATCA), a Fund will be required to withhold
a 30% tax on income dividends made by the Fund to certain foreign entities,
referred to as foreign financial institutions or non-financial foreign entities,
that fail to comply (or be deemed compliant) with extensive reporting and
withholding requirements designed to inform the U.S. Department of the Treasury
of U.S.-owned foreign investment accounts. After December 31, 2018, FATCA
withholding also would have applied to certain capital gain distributions,
return of capital distributions and the proceeds arising from the sale of Fund
shares; however, based on proposed regulations issued by the IRS, which can be
relied upon currently, such withholding is no longer required unless final
regulations provide otherwise (which is not expected). A Fund may disclose the
information that it receives from its shareholders to the IRS, non-U.S. taxing
authorities or other parties as necessary to comply with FATCA or similar laws.
Withholding also may be required if a foreign entity that is a shareholder of a
Fund fails to provide the Fund with appropriate certifications or other
documentation concerning its status under FATCA.
■
Taxes,
penalties, and interest associated with an audit of a partnership are generally
required to be assessed and collected at the partnership level. Therefore, an
adverse federal income tax audit of an MLP taxed as a partnership that the Fund
invests in could result in the Fund being required to pay federal income tax.
The Fund may have little input in any audit asserted against an MLP and may be
contractually or legally obligated to make payments in regard to deficiencies
asserted without the ability to put forward an independent defense. Accordingly,
even if an MLP in which the Fund invests were to remain classified as a
partnership, it could be required to pay additional taxes, interest and
penalties as a result of an audit adjustment, and the Fund, as a direct or
indirect partner of such MLP, could be required to bear the economic burden of
those taxes, interest and penalties, which would reduce the value of Fund
shares.
■
Under the Tax
Cuts and Jobs Act certain “qualified publicly traded partnership income” (e.g.,
certain income from certain of the MLPs in which the Fund invests) is treated as
eligible for a 20% deduction by noncorporate taxpayers. The Tax Cuts and Jobs
Act does not contain a provision permitting an entity, such as the Fund, to
benefit from this deduction (since the Fund is taxed as a “C” corporation) or
pass the special character of this income through to its shareholders. Qualified
publicly traded partnership income allocated to a noncorporate investor
investing directly in an MLP might, however, be eligible for the
deduction.
A-26 The
Invesco Funds
The
above discussion concerning the taxability of Fund dividends and distributions
and of redemptions and exchanges of Fund shares is inapplicable to investors
holding shares through a tax-advantaged arrangement, such as Retirement and
Benefit Plans or 529 college savings plans. Such investors should refer to the
applicable account documents/program description for that arrangement for more
information regarding the tax consequences of holding and redeeming Fund
shares.
This
discussion of “Taxes” is for general information only and not
tax advice. All investors should consult their own tax advisers as to the
federal, state, local and foreign tax provisions applicable to
them.
Payments
to Financial Intermediaries – All Share Classes except Class R6
shares
The financial
adviser or intermediary through which you purchase your shares may receive all
or a portion of the sales charges and distribution fees discussed above. In
addition to those payments, Invesco Distributors and other Invesco Affiliates,
may make additional cash payments to financial intermediaries in connection with
the promotion and sale of shares of the Funds. These additional cash payments
may include cash payments and other payments for certain marketing and support
services. Invesco Affiliates make these payments from their own resources, from
Invesco Distributors’ retention of initial sales charges and from payments to
Invesco Distributors made by the Funds under their 12b-1 plans. In the context
of this prospectus, “financial intermediaries” include any broker, dealer, bank
(including bank trust departments), registered investment adviser, financial
planner, retirement plan administrator, insurance company and any other
financial intermediary having a selling, administration or similar agreement
with Invesco Affiliates.
The
benefits Invesco Affiliates receive when they make these payments include,
among other things, placing the Funds on the financial intermediary’s fund sales
system, and access (in some cases on a preferential basis over other
competitors) to individual members of the financial intermediary’s sales force
or to the financial intermediary’s management. These payments are sometimes
referred to as “shelf space” payments because the payments compensate the
financial intermediary for including the Funds in its fund sales system (on its
“sales shelf”). Invesco Affiliates compensate financial intermediaries
differently depending typically on the level and/or type of considerations
provided by the financial intermediary. The payments Invesco Affiliates make may
be calculated based on sales of shares of the Funds (Sales-Based Payments), in
which case the total amount of such payments shall not exceed 0.25% (0.10% for
Class R5 shares) of the public offering price of all shares sold by the
financial intermediary during the particular period. Payments may also be
calculated based on the average daily net assets of the applicable Funds
attributable to that particular financial intermediary (Asset-Based Payments),
in which case the total amount of such cash payments shall not exceed 0.25% per
annum of those assets during a defined period. Sales-Based Payments primarily
create incentives to make new sales of shares of the Funds and Asset-Based
Payments primarily create incentives to retain previously sold shares of the
Funds in investor accounts. Invesco Affiliates may pay a financial intermediary
either or both Sales-Based Payments and Asset-Based Payments.
Invesco
Affiliates are motivated to make these payments as they promote the
sale of Fund shares and the retention of those investments by clients of the
financial intermediaries. To the extent financial intermediaries sell more
shares of the Funds or retain shares of the Funds in their clients’ accounts,
Invesco Affiliates benefit from the incremental management and other fees paid
to Invesco Affiliates by the Funds with respect to those assets.
The
Funds’ transfer agent may make payments to certain financial intermediaries
for certain administrative services, including record keeping and sub-accounting
of shareholder accounts pursuant to a sub-transfer agency, omnibus account
service or sub-accounting agreement. All fees payable by Invesco Affiliates
under this category of services are charged back to the Funds, subject to
certain limitations approved by the Board.
You
can find further details in the Fund’s SAI about these payments and the services
provided by financial intermediaries. In certain cases these payments could be
significant to the financial intermediaries. Your financial adviser may charge
you additional fees or commissions other than those disclosed in this
prospectus. You can ask your financial adviser about any payments it receives
from Invesco Affiliates or the Funds, as well as about fees and/or commissions
it charges.
Important
Notice Regarding Delivery of Security Holder Documents
To reduce
Fund expenses, only one copy of most shareholder documents may be mailed to
shareholders with multiple accounts at the same address (Householding). Mailing
of your shareholder documents may be householded indefinitely unless you
instruct us otherwise. If you do not want the mailing of these documents to be
combined with those for other members of your household, please contact the
Funds’ transfer agent at 800-959-4246 or contact your financial institution. The
Funds’ transfer agent will begin sending you individual copies for each account
within thirty days after receiving your request.
Inactive
or Unclaimed Accounts
Please note
that if your account is deemed to be unclaimed or abandoned under applicable
state law, the Fund may be required to transfer (or “escheat”) the assets in
that account to the appropriate state. Some states may sell escheated shares, in
which case a shareholder may only be able to recover the amount received when
the shares were sold. For shareholders that invest through retirement accounts,
the escheatment will be treated as a taxable distribution and federal and any
applicable state income tax may be withheld. The Fund, its Board, and the Fund's
transfer agent will not be liable to shareholders for good faith compliance with
state unclaimed or abandoned property laws. To avoid these outcomes and protect
their property, shareholders that invest in the Fund through an account held
directly with the Fund's transfer agent are encouraged to routinely confirm that
the mailing address on their account is current and valid and contact the
transfer agent at least once a year by one of the following methods:
• Accessing
your account online at invesco.com/us.
• Accessing
your account balance through the automated Invesco Investor Line at 800 246
5463.
• Contacting
us by phone or in writing for any matter related to your
account.
A-27 The
Invesco Funds
Obtaining Additional Information
More
information may be obtained free of charge upon request. The SAI, a current
version of which is on file with the SEC, contains more details about the Fund
and is incorporated by reference into this prospectus (is legally a part of this
prospectus). Annual and semi-annual reports to shareholders and Form N-CSR filed
with the SEC contain additional information about the Fund’s investments. The
Fund’s annual report also discusses the market conditions and investment
strategies that significantly affected the Fund’s performance during its last
fiscal year. The Fund also files its complete schedule of portfolio holdings
with the SEC for the 1st and 3rd quarters of each fiscal year as an exhibit to
its reports on Form N-PORT.
If you have
questions about an Invesco Fund or your account, or you wish to obtain a free
copy of the Fund’s current SAI, annual or semi-annual reports or Form N-PORT,
please contact us.
|
By
Mail: |
Invesco
Investment Services, Inc.
P.O.
Box 219078
Kansas
City, MO 64121-9078 |
|
By
Telephone: |
(800)
959-4246 |
|
On
the Internet: |
You
can send us a request by e-mail or
download
prospectuses, SAIs, annual or
semi-annual
reports via our website:
www.invesco.com/us |
Reports and
other information about the Fund are available on the EDGAR Database on the
SEC's Internet site at http://www.sec.gov, and copies of this information may be
obtained, after paying a duplicating fee, by electronic request at the following
e-mail address: [email protected].
|
Invesco
Rochester®
New York Municipals Fund
SEC 1940 Act file
number: 811-07890 |
|
invesco.com/us |
O-ROM-PRO-1 |