497 1 a497.txt 497 THE VALUE LINE SPECIAL SITUATIONS FUND, INC. -------------------------------------------------------------------------------- SUPPLEMENT DATED JUNE 15, 2000, TO PROSPECTUS DATED MAY 1, 2000 ------------------------------------------------------------------------ At a shareholder's meeting held on June 15, 2000, the shareholders approved the adoption of a Service and Distribution Plan, effective July 1, 2000, under rule 12b-1 of the Investment Company Act of 1940 (the "Plan"). Under the Plan, the Fund is charged a fee at the annual rate of 0.25% of the Fund's average daily net assets with the proceeds used to finance the activities of Value Line Securities, Inc., the Fund's distributor. The Plan provides that the distributor may make payments to securities dealers, banks, financial institutions and other organizations which provide distribution and administrative services with respect to the distribution of the Fund's shares. Such services may include, among other things, answering investor inquiries regarding the Fund; processing new shareholder account applications and redemption transactions; responding to shareholder inquiries; and such other services as the Fund may request to the extent permitted by applicable statute, rule or regulation. The Plan also provides that the Adviser may make such payments out of its advisory fee, its past profits or any other source available to it. The fees payable to the distributor under the Plan are payable without regard to actual expenses incurred. FEE TABLE This table describes the fees and expenses that you pay in connection with an investment in the Fund and replaces the information on page 4 of the Prospectus. ANNUAL FUND OPERATING EXPENSES (EXPENSES THAT ARE DEDUCTED FROM THE FUND'S ASSETS)
--------------------------------------------------------------- MANAGEMENT FEES 0.75% --------------------------------------------------------------- DISTRIBUTION AND SERVICE (12b-1) FEES* 0.25% --------------------------------------------------------------- OTHER EXPENSES 0.14% --------------------------------------------------------------- TOTAL ANNUAL FUND OPERATING EXPENSES 1.14% ---------------------------------------------------------------
* Effective July 1, 2000. Because these fees are paid out of the Fund's assets on an ongoing basis, over time these fees will increase the cost of your investment and may cost you more than if you paid other types of sales charges.
EXAMPLE This example is intended to help you compare the cost of investing in the Fund to the cost of investing in other mutual funds. We show the cumulative amount of Fund expenses on a hypothetical investment of $10,000 with an annual 5% return over the time shown assuming that the Fund's operating expenses remain the same. The expenses indicated for each period would be the same whether you sold your shares at the end of each period or continued to hold them. This is an example only, and your actual costs may be greater or less than those shown here. Based on these assumptions, your cost would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS ----------------------------------------------------------------------------- VALUE LINE SPECIAL SITUATIONS FUND $116 $362 $628 $1,386 -----------------------------------------------------------------------------
THE VALUE LINE SPECIAL SITUATIONS FUND, INC. -------------------------------------------------------------------------------- SUPPLEMENT DATED JUNE 15, 2000, TO STATEMENT OF ADDITIONAL INFORMATION DATED MAY 1, 2000 ------------------------------------------------------------------------ At a shareholder's meeting held on June 15, 2000, the shareholders elected the following additional directors: Frances T. Newton Computer Programming 4921 Buckingham Drive Professional, Duke Power Company Charlotte, NC 28209 Age 58 Francis C. Oakley Professor of History, Williams 54 Scott Hill Road College, 1961 to present, Williamstown, MA 01267 President, 1985-1993, and Age 68 President Emeritus since 1994; Director, Berkshire Life Insurance Company Marion N. Ruth Real Estate Executive. 5 Outrider Road President, Ruth Realty (real Rolling Hills, CA 90274 estate broker) Age 65