<PAGE> 1
SEMIANNUAL REPORT / JUNE 30 2000
AIM FLOATING RATE FUND
[COVER IMAGE]
[AIM LOGO APPEARS HERE]
--Registered Trademark--
<PAGE> 2
[ COVER IMAGE ]
------------------------------------
SAILBOATS AROUND THE PENINSULA BY PETER SICKLES
SAILBOATS GLIDE MAJESTICALLY ON A PLACID OCEAN ON THEIR WAY TO
A FRIENDLY PORT. WHETHER THE ECONOMIC WATERS ARE CALM OR
TURBULENT, AIM FLOATING RATE FUND ENDEAVORS TO BE A STABLE
INVESTMENT VEHICLE FOR SHAREHOLDERS WHILE TRANSPORTING THEM
TO THEIR FINANCIAL DESTINATION.
------------------------------------
AIM Floating Rate Fund is for shareholders who seek a high level of current
income and preservation of capital consistent with investing in senior secured
floating rate corporate loans and senior secured debt securities.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Floating Rate Fund's performance figures are historical, and they
reflect the reinvestment of distributions and changes in net asset value.
o When sales charges are included in performance figures, performance reflects
the maximum applicable early withdrawal charge. For Class B shares, the
early withdrawal charge declines from 3% beginning at the time of purchase
to 0% at the beginning of the fifth year. For Class C shares, the early
withdrawal charge is 1% for the first year after purchase.
o On 4/3/00, the fund's existing shares were converted to Class B shares. The
fund's Class C shares have been offered since 4/3/00. Because Class C shares
have been offered for less than a year, the returns provided for Class C
shares are cumulative total returns that have not yet been annualized.
o Including withdrawal charges, total return for Class B shares was -0.07% for
the six months ended 6/30/00; total return for Class C shares was 0.43% from
inception on 4/3/00 through 6/30/00.
o The 30-day distribution rate is calculated by dividing the annualized sum of
the previous 30 days' declared dividends by the offering price per share on
the last day of the period.
o The fund invests primarily in higher-yielding, lower-rated senior secured
floating-rate corporate loans and other debt obligations that are subject to
the risk of nonpayment of scheduled interest or principal payments, which
may cause the fund's net asset value per share to decline. Prepayment of
principal by borrowers may require the fund to replace its investment with a
lower-yielding security that may adversely affect the fund's net asset
value.
o The fund's investment return and principal value will fluctuate, so an
investor's shares, when redeemed, may be worth more or less than their
original cost.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The London Interbank Offered Rate (LIBOR) is the interest rate the world's
most creditworthy banks charge one another for large loans. It is used
worldwide as a base interest rate for loans to major commercial and
industrial corporations.
o The unmanaged Standard & Poor's Composite Index of 500 Stocks (the S&P 500)
represents the performance of the stock market.
o An investment cannot be made in an index. Unless otherwise indicated, index
results include reinvested dividends, and they do not reflect sales charges.
AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF A BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENT AGENCY. THERE IS A RISK THAT YOU COULD LOSE SOME OR ALL OF
YOUR MONEY.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the fund.
AIM FLOATING RATE FUND
<PAGE> 3
SEMIANNUAL REPORT/CHAIRMAN'S LETTER
Dear Fellow Shareholder:
When we started AIM in 1976, we had only a table, two chairs
[PHOTO OF and a telephone. At the time, Bob Graham, Gary Crum and I
Charles T. had the idea of creating a mutual fund company that put
Bauer, people first. Our slogan, "people are the product," means
Chairman of that people -- our employees and our investors -- are our
the Board of company.
THE FUND Almost a quarter-century later, we've grown to more than
APPEARS HERE] eight million investors, $176 billion in assets under
management and 53 retail funds. Over that time, the industry
[PHOTO OF as a whole has grown from $51 billion in assets to more than
Robert H. $7 trillion today. I never dreamed we would see such
Graham phenomenal growth. You are the main reason for our success,
APPEARS HERE] and I want you to know how much I appreciate your loyalty
and trust over the past 24 years.
Usually in this letter I review market activity during
the period covered by the report. This time, I'd just like
to say thank you. I am retiring as chairman of the AIM Funds effective
September 30, and as chairman of AIM effective December 31, 2000. Bob Graham,
whose picture appears under mine, will succeed me as AIM's chairman and chairman
of the AIM Funds. Gary Crum will remain president of A I M Capital Management,
Inc., leading our investment division. I am enormously proud to leave AIM in
such capable hands.
I'm also very proud of our team of employees, now more than 2,500 strong.
Because of their collective commitment to excellence and ethical business
practices, AIM has earned the trust of investors and financial advisors alike.
And every employee, from portfolio managers to client services representatives,
is dedicated to serving our shareholders.
Rest assured that nothing at AIM will change because of my retirement. You
can still depend on this company to manage your money responsibly and provide
you with top-notch service. As chairman of AIM and chairman of the AIM Funds,
Bob is committed to preserving the things that have made AIM great in the past
and positioning it to succeed in the future. And Gary is dedicated to
maintaining the quality and long-term performance you've come to expect from
AIM.
In the pages that follow, the managers of your fund comment on recent market
activity, how they have managed your fund over the past six months and their
outlook for the coming months. We trust you will find their comments helpful.
If you have any questions or comments, please contact us through our Web
site, www.aimfunds.com, or call our Client Services department at 800-959-4246
during normal business hours. Information about your account is available at our
Web site and on our automated AIM Investor Line, 800-246-5463.
Thank you again for the support and trust you've shown us. I feel privileged
to have helped you with your financial goals, and I wish you success in all your
endeavors.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
AIM FLOATING RATE FUND
<PAGE> 4
SEMIANNUAL REPORT / MANAGERS' OVERVIEW
AIM FLOATING RATE FUND CONTINUES TO PROVIDE SOLID INCOME
FINANCIAL MARKETS WERE VOLATILE DURING THE FIRST HALF OF 2000. HOW DID AIM
FLOATING RATE FUND PERFORM?
The fund, which invests primarily in senior secured floating-rate loans,
provided solid income to shareholders during the six months ended June 30, 2000.
At the close of the reporting period the fund's 30-day distribution rate was
8.35% for Class B shares and 8.33% for Class C shares. By comparison, the
six-month London InterBank Offered Rate (LIBOR) was 7.00%.
Net asset value per share declined somewhat during the reporting period,
from $9.68 to $9.58. While the fund endeavors to maintain a relatively stable
net asset value, floating-rate investments should not be confused with money
market funds, and the fund's net asset value will not be as stable as that of a
money market fund.
During the reporting period, the fund's net assets increased from $440
million to $458 million.
WHAT WERE SOME OF THE MAJOR TRENDS IN U.S. EQUITY MARKETS?
Like a roller coaster, U.S. equity markets offered investors a thrilling ride
for the first half of the year. Many technology stocks that had increased in
price significantly last year fell sharply in March and April. Some non-tech
stocks did likewise, particularly stocks that announced potential earnings
shortfalls. The S&P 500, considered representative of the stock market as a
whole, actually declined by 0.43% during the six-month reporting period. Much of
the volatility was the result of the Federal Reserve Board (the Fed) repeatedly
raising the key federal funds rate (the interest rate banks charge one another
for overnight loans) -- increases that clearly unnerved investors. Over the last
year the Fed has raised rates six times (for a cumulative increase of 1.75%) in
an effort to contain inflation and cool off the economy.
In response to this volatility, some investors sought safety by shifting
from high-flying growth stocks to value stocks. Other investors simply moved to
cash and waited to see whether the Fed would continue its year-long series of
rate increases, waited to see where the economy was headed and waited to
evaluate mid-year corporate earnings reports. This "wait-and-see" attitude
caused the markets to drift for much of May and June.
WHAT WERE THE TRENDS IN THE BOND MARKETS?
Fed rate increases and a government buyback of long-term Treasury bonds affected
the bond market during the first half of the year. The six rate increases
imposed by the Fed over the last year adversely affected the bond markets as a
whole. Long-term Treasuries, however, were among the best-performing sectors of
the U.S. domestic bond market -- largely due to the Treasury Department's
debt-buyback plan announced in January. Under the plan, the government announced
its intention to repurchase long-term higher-interest federal debt held by the
public. Investors, fearing that long bonds might become scarce, drove their
prices higher.
Interest-rate concerns caused most other sectors of the bond market to
underperform. Yield spreads between long-term Treasuries and other bonds widened
to become the widest in several years at the close of the reporting period.
Lower-rated high-yield bonds in particular performed poorly as interest rates
increased and the economy slowed.
HOW DID SENIOR SECURED FLOATING-RATE LOANS FARE IN THIS RISING INTEREST-RATE
ENVIRONMENT?
Senior secured floating-rate loans tended to be more stable in value than many
other types of investments. That's because interest rates on such loans, made by
banks and other financial institutions to corporations, are periodically
adjusted (usually every 30 to 60 days) to correspond with the underlying LIBOR
contract. Also, their value tends to remain more stable than that of some other
investments because of their senior status. That senior status means that in
most instances, these loans carry the highest-priority claim on a borrower's
assets and earnings. While past performance cannot guarantee
FUND VS. LIBOR
As of 6/30/00
================================================================================
FUND CLASS B SHARES, 30-DAY DISTRIBUTION RATE 8.35%
FUND CLASS C SHARES, 30-DAY DISTRIBUTION RATE 8.33%
6-MONTH LONDON INTERBANK OFFERED RATE 7.00%
================================================================================
RELATIVE PRICE STABILITY-CLASS B SHARES
5/1/97-6/30/00
================================================================================
5/1/97 10 4/98 10.01 9/99 9.75
6/97 10 5/98 10 12/99 9.68
7/97 10 6/98 10 3/00 9.63
8/97 10.01 7/98 10 6/00 9.58
9/97 10.01 8/98 10
10/97 10.02 9/98 9.89
11/97 10.02 10/98 9.85
12/97 10.02 11/98 9.82
1/98 10.02 12/98 9.84
2/98 10.02 3/99 9.83
3/98 10.01 6/99 9.82
There is no guarantee that the fund will maintain a constant net asset value.
Investment return will vary, so you may have a gain or a loss when you sell
shares. Past performance cannot guarantee comparable future results.
================================================================================
See important fund and index disclosures inside front cover.
AIM FLOATING RATE FUND
2
<PAGE> 5
SEMIANNUAL REPORT / MANAGER'S OVERVIEW
comparable future results, the default rate on such loans has historically been
relatively low. Even in the event of a default, these loans are often backed by
collateral such as property, equipment or patents that can be sold to meet debt
obligations.
WHAT IS THE MAIN RISK ASSOCIATED WITH SENIOR SECURED FLOATING-RATE LOANS, AND
HOW DO YOU ATTEMPT TO REDUCE THAT RISK?
Since most of these loans are below investment-grade quality (as measured by
Standard & Poor's Corporation and Moody's Investors Service, two widely known
credit-rating agencies), the primary risk is credit risk, i.e. a company being
unable to repay its loan.
We are very careful in selecting loans for the fund's portfolio. For each
company represented in the portfolio, we evaluate management and examine the
company's financial situation, its position within its industry and its business
prospects. After this evaluation is completed, we analyze the loan to ascertain
its value compared to similar types of investments and to determine how well it
might trade in the market. If our overall assessment is favorable, we buy the
loan.
HOW WAS THE FUND POSITIONED AT THE CLOSE OF THE REPORTING PERIOD?
A total of 111 holdings were represented in the fund's portfolio on June 30,
2000. Companies in the fund included:
o Stone Container, which produces corrugated containers, folding cartons and
bag packaging. One of the world's largest recyclers of paper fiber, the company
also owns 132,000 acres of timberland and wood-harvesting facilities in Canada.
o Allied Waste Industries, the nation's second-largest waste-hauler, picks up
garbage from 9.9 million residential, commercial and industrial customers in 46
states. Allied is in the midst of a corporate reorganization, selling some
non-core holdings and seeking companies that fit into its strategic growth plan.
o AMFM, the largest U.S. radio-station owner, operates more than 450 stations
in about 100 markets. Its stations reach nearly 60 million listeners. The
company has agreed to be acquired by Clear Channel Communications (not a fund
holding).
WHAT IS YOUR OUTLOOK?
We expect the stock and bond markets to remain somewhat unpredictable going
forward -- at least until the direction of interest rates and the economy as a
whole can be discerned. Stock and bond markets hate uncertainty, of which there
appears to be plenty at present. Will the Fed continue raising rates, or will it
end its year-long string of increases? Will the economy make a "soft landing,"
or will it lurch into a recession?
It's been an interesting first half of the year. Stocks, as measured by the
S&P 500, are basically flat for the year -- after running up significantly in
January and February, and then falling sharply in March and April. With the
exception of long-term Treasury bonds, most fixed-income securities have
underperformed as a result of rising interest rates. In such an environment, we
would expect senior secured floating-rate loans to be more stable in price than
some other types of investments because of their adjustable interest rates.
Investors desiring relative price stability and a steady source of income may
find senior secured floating-rate loans an attractive investment option.
SHAREHOLDERS APPROVE FUND REORGANIZATION
Prior to this year, AIM Floating Rate Fund offered just one class of shares that
could be tendered only when the fund's board of directors voted to authorize a
tender offer. In February, shareholders approved a fund reorganization allowing
for, among other things:
o regular quarterly tender offers ALLOWING, BUT NOT REQUIRING, shareholders to
redeem their shares
o the conversion of existing shares to Class B shares, and the offering
(beginning on April 3) of Class C shares
o the reorganization of the fund as a Delaware trust
These changes to the fund became effective April 3. THE NEXT UPCOMING TENDER
OFFER WILL BE OCTOBER 27- NOVEMBER 17. During that three-week period,
shareholders may tender their shares, but are under no obligation to do so.
PORTFOLIO COMPOSITION
As of 6/30/00, based on total net assets
<TABLE>
<CAPTION>
===================================================================================================================================
TOP 10 ISSUERS TOP 10 INDUSTRIES
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Stone Container Corp. 2.56% 1. Broadcasting (Television, 7.85%
Radio & Cable)
2. Allied Waste Industries 2.04 2. Containers and Packaging 5.22
3. Huntsman 1.95 3. Lodging 5.14
4. AMFM Operating Inc. 1.74 4. Publishing 5.02
5. Graham Packaging 1.69 6. Telephone Systems 4.67
6. Huntsman ICI Chemicals 1.63 5. Consumer Services 3.64
7. VoiceStream PCS 1.61 7. Chemicals (Commodity) 3.58
8. Ferrellgas, L.P. 1.52 8. Office Equipment and Supplies 3.33
9. Coinmach 1.49 9. Pollution Control (Waste Management) 3.22
10. Sovereign Bancorp, Inc. 1.37 10. Auto Parts and Equipment 2.97
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
===================================================================================================================================
</TABLE>
See important fund and index disclosures inside front cover.
AIM FLOATING RATE FUND
3
<PAGE> 6
SCHEDULE OF INVESTMENTS
June 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
SENIOR SECURED FLOATING RATE
INTERESTS-94.24%(a)(b)
ADVERTISING-1.09%
Big Flower Press Holdings Co.
Term Loan B due 12/07/08 B1 $4,991,667 $ 4,991,667
------------------------------------------------------------------
AEROSPACE & DEFENSE-1.60%
Titan Corp. (The)
Term Loan B due 02/23/07 Ba3 2,493,750 2,499,984
------------------------------------------------------------------
Transtar Metals, Inc.
Term Loan B due 12/31/05 NR 4,973,214 4,824,018
------------------------------------------------------------------
7,324,002
------------------------------------------------------------------
APPAREL & TEXTILE MANUFACTURING-1.07%
Glenoit Corp.
Term Loan B due 06/30/04 Caa1 4,917,456 4,899,016
------------------------------------------------------------------
AUTOMOBILE PARTS & EQUIPMENT-2.97%
Avis Group Holdings, Inc.
Term Loan B due 06/30/06 Ba3 2,496,667 2,499,008
------------------------------------------------------------------
Term Loan C due 06/30/07 Ba3 2,496,667 2,499,008
------------------------------------------------------------------
Foamex, L.P.
Term Loan D due 12/31/06 B3 3,702,759 3,605,561
------------------------------------------------------------------
Joan Fabrics Corp.
Term Loan B due 06/30/05 NR 1,328,204 1,323,224
------------------------------------------------------------------
Term Loan C due 06/30/06 NR 688,086 685,506
------------------------------------------------------------------
Tenneco Inc.
Term Loan B due 09/30/07 Ba3 1,500,000 1,504,500
------------------------------------------------------------------
Term Loan C due 03/30/08 Ba3 1,500,000 1,504,500
------------------------------------------------------------------
13,621,307
------------------------------------------------------------------
BEVERAGES-1.08%
Vitality Foodservice, Inc.
Term Loan B due 10/26/06 B1 4,975,000 4,950,125
------------------------------------------------------------------
BUILDING MATERIALS-1.76%
Atrium Co.
Term Loan B due 06/30/05 B1 1,343,333 1,343,333
------------------------------------------------------------------
Term Loan C due 06/30/06 B1 1,928,611 1,928,611
------------------------------------------------------------------
Trussway Holdings, Inc.
Term Loan B due 12/31/06 B1 4,987,500 4,812,938
------------------------------------------------------------------
8,084,882
------------------------------------------------------------------
CASINOS-1.90%
Aladdin Gaming, L.L.C.
Term Loan B due 08/26/06 B2 277,778 268,056
------------------------------------------------------------------
Term Loan C due 02/26/08 B2 2,222,222 2,144,444
------------------------------------------------------------------
Horseshoe Gaming Holding
Corp.
Term Loan B due 03/17/06 Ba2 2,976,000 2,983,440
------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
CASINOS-(CONTINUED)
Resort at Summerlin L.P.
Term Loan A due 03/31/04 B3 $3,660,000 $ 3,294,000
------------------------------------------------------------------
8,689,940
------------------------------------------------------------------
CHEMICALS-COMMODITY-3.58%
Huntsman Corp.
Term Loan B due 06/30/04 Ba2 3,442,437 3,438,134
------------------------------------------------------------------
Term Loan C due 12/31/05 Ba2 5,500,000 5,500,000
------------------------------------------------------------------
Lyondell Chemical Co.
Term Loan B due 06/30/05 Ba3 2,060,758 2,081,366
------------------------------------------------------------------
Term Loan E due 05/20/06 Ba3 1,960,113 2,015,067
------------------------------------------------------------------
Sterling Pulp Chemicals
(SASK) Ltd.
Term Loan B due 06/30/05 B2 3,413,572 3,379,436
------------------------------------------------------------------
16,414,003
------------------------------------------------------------------
CHEMICALS-SPECIALTY-1.63%
Huntsman ICI Chemicals LLC
Term Loan B due 06/30/07 Ba3 3,712,500 3,735,703
------------------------------------------------------------------
Term Loan C due 06/30/08 Ba3 3,712,500 3,735,703
------------------------------------------------------------------
7,471,406
------------------------------------------------------------------
COAL-0.00%
Centennial Resources(c)(d)
Term Loan A due 03/31/02 Caa1 850,000 --
------------------------------------------------------------------
Term Loan B due 03/31/04 Caa1 1,966,666 --
------------------------------------------------------------------
0
------------------------------------------------------------------
COMMUNICATIONS TECHNOLOGY-0.44%
Crown Castle Operating Co.
Term Loan B due 03/15/08 Ba3 2,000,000 2,004,376
------------------------------------------------------------------
COMPUTERS-0.70%
GENICOM Corp.(c)(d)
Term Loan due 09/05/02 NR 360,830 357,201
------------------------------------------------------------------
Term Loan B due 09/05/04 NR 4,781,250 2,868,750
------------------------------------------------------------------
3,225,951
------------------------------------------------------------------
CONSUMER SERVICES-3.64%
Bally Total Fitness Holding
Corp.
Term Loan B due 11/04/04 B1 4,983,333 4,952,187
------------------------------------------------------------------
Coinmach Corp.
Term Loan B due 06/30/05 NR 6,827,764 6,810,694
------------------------------------------------------------------
Jostens, Inc.
Term Loan B due 05/31/08 B1 2,000,000 2,004,584
------------------------------------------------------------------
Rose Hills
Term Loan due 11/01/03 B2 2,937,500 2,908,125
------------------------------------------------------------------
16,675,590
------------------------------------------------------------------
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
CONTAINERS & PACKAGING-5.22%
Graham Packaging Co. L.P.
Term Loan B due 01/31/06 B1 $2,418,409 $ 2,416,682
------------------------------------------------------------------
Term Loan C due 01/31/07 B1 2,003,824 2,003,407
------------------------------------------------------------------
Term Loan D due 01/31/07 B1 3,324,375 3,322,712
------------------------------------------------------------------
Kerr Group, Inc.
Term Loan B due 03/31/06 NR 1,995,000 1,990,013
------------------------------------------------------------------
Packaging Dynamics, LLC
Term Loan B due 11/13/05 NR 2,464,792 2,464,792
------------------------------------------------------------------
Stone Container Corp.
Term Loan C due 10/01/03 Ba3 6,713,090 6,726,516
------------------------------------------------------------------
Term Loan F due 12/31/05 Ba3 1,880,000 1,880,940
------------------------------------------------------------------
Term Loan G due 12/31/06 Ba3 1,480,000 1,479,630
------------------------------------------------------------------
Term Loan H due 12/31/06 Ba3 1,640,000 1,639,590
------------------------------------------------------------------
23,924,282
------------------------------------------------------------------
COSMETICS-PERSONAL CARE-0.52%
American Safety Razor Co.
Term Loan B due 02/05/05 B1 2,363,140 2,365,108
------------------------------------------------------------------
ELECTRICAL COMPONENTS &
EQUIPMENT-2.52%
Amkor Technology, Inc.
Term Loan B due 10/21/05 Ba2 3,000,000 3,016,251
------------------------------------------------------------------
Chatham Technologies, Inc.
Term Loan due 09/19/03 B1 3,393,277 3,291,479
------------------------------------------------------------------
Electro Mechanical Solutions,
Inc.(d)
Term Loan B due 06/30/04 NR 2,809,448 2,528,503
------------------------------------------------------------------
Term Loan C due 11/30/04 NR 3,020,168 2,718,151
------------------------------------------------------------------
11,554,384
------------------------------------------------------------------
ENTERTAINMENT-1.09%
DreamWorks LLC
Term Loan A due 01/15/09 Baa3 5,000,000 4,975,000
------------------------------------------------------------------
FACTORY EQUIPMENT-1.35%
Formax, Inc.
Term Loan B due 09/30/05 NR 6,327,028 6,168,852
------------------------------------------------------------------
FINANCIAL SERVICES/DIVERSIFIED-2.51%
Bridge Information Systems,
Inc.
Term Loan B due 05/29/05 NR 3,725,722 3,250,693
------------------------------------------------------------------
Data Transmission Network,
LLC
Term Loan B due 12/31/06 B1 2,000,000 1,990,000
------------------------------------------------------------------
Sovereign Bancorp, Inc.
Term Loan due 06/30/03 Ba3 6,250,000 6,276,044
------------------------------------------------------------------
11,516,737
------------------------------------------------------------------
FOOD-1.44%
American Seafoods Group LLC
Term Loan B due 01/14/06 Ba3 3,000,000 2,992,500
------------------------------------------------------------------
Aurora Foods Inc.
Term Loan B due 06/30/07 B2 992,500 886,633
------------------------------------------------------------------
New World Pasta Co.
Term Loan B due 01/31/06 B1 1,764,333 1,733,457
------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
FOOD-(CONTINUED)
Tabletop (Merisant Co.)
Term Loan B due 03/31/07 Ba3 $ 996,544 $ 1,001,241
------------------------------------------------------------------
6,613,831
------------------------------------------------------------------
HEALTH CARE PROVIDERS-2.27%
Caremark RX, Inc.
Term Loan B due 06/08/01 B1 777,668 753,041
------------------------------------------------------------------
Community Health Systems,
Inc.
Term Loan D due 12/30/05 B1 4,845,356 4,809,016
------------------------------------------------------------------
Genesis Health Ventures, Inc.
Term Loan B due 09/30/04 Caa2 1,191,410 753,567
------------------------------------------------------------------
Term Loan C due 06/01/05 Caa2 1,185,567 749,871
------------------------------------------------------------------
Mariner Post-Acute Network,
Inc.(c)(d)
Term Loan B due 03/31/05 Caa2 2,351,181 1,175,591
------------------------------------------------------------------
Term Loan C due 03/31/06 Caa2 2,351,181 1,175,591
------------------------------------------------------------------
Multicare Companies, Inc.(c)
Term Loan B due 09/30/04 Caa3 1,152,823 729,161
------------------------------------------------------------------
Term Loan C due 06/01/05 Caa3 382,309 241,810
------------------------------------------------------------------
10,387,648
------------------------------------------------------------------
HEAVY CONSTRUCTION-1.12%
Terex Corp.
Term Loan B due 03/02/05 Ba3 4,049,045 4,046,214
------------------------------------------------------------------
Term Loan C due 03/06/06 Ba3 1,090,788 1,090,788
------------------------------------------------------------------
5,137,002
------------------------------------------------------------------
HOME CONSTRUCTION-1.09%
Lennar Corp.
Term Loan B due 05/03/07 Ba1 5,000,000 5,012,500
------------------------------------------------------------------
HOUSEHOLD FURNISHINGS-APPLIANCES-1.81%
Imperial Home Decor Group, Inc.
(The)(c)(d)
Term Loan A due 03/12/03 B1 1,406,532 1,195,552
------------------------------------------------------------------
Term Loan due 03/12/04 B1 914,263 777,123
------------------------------------------------------------------
Term Loan B due 03/12/05 B1 1,909,230 1,622,845
------------------------------------------------------------------
Term Loan C due 03/12/06 B1 746,184 634,256
------------------------------------------------------------------
Rent-A-Center
Term Loan B due 02/05/06 Ba3 1,843,812 1,835,171
------------------------------------------------------------------
Term Loan C due 02/05/07 Ba3 2,256,613 2,248,857
------------------------------------------------------------------
8,313,804
------------------------------------------------------------------
HOUSEHOLD PRODUCTS-2.14%
Boyds Collection, Ltd. (The)
Term Loan B due 04/01/06 Ba3 772,222 767,396
------------------------------------------------------------------
Paint Sundry Brands Corp.
Term Loan B due 08/11/05 NR 1,659,544 1,659,544
------------------------------------------------------------------
Term Loan C due 08/11/06 NR 1,535,038 1,535,038
------------------------------------------------------------------
United Industries Co.
Loan B due 03/24/06 B1 5,895,000 5,828,681
------------------------------------------------------------------
9,790,659
------------------------------------------------------------------
</TABLE>
5
<PAGE> 8
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
INDUSTRIAL & COMMERCIAL SERVICES-2.58%
Century Maintenance Supply,
Inc.
Term Loan B due 07/08/05 NR $4,900,000 $ 4,875,500
------------------------------------------------------------------
Ferrellgas, L.P.
Term Loan C due 06/17/06 NR 7,000,000 6,965,000
------------------------------------------------------------------
11,840,500
------------------------------------------------------------------
INDUSTRIAL-DIVERSIFIED-2.15%
Goss Graphic Systems, Inc.
Term Loan due 01/29/03 B3 3,000,000 2,295,000
------------------------------------------------------------------
Mueller Group, Inc.
Term Loan B due 08/16/06 B1 990,000 992,062
------------------------------------------------------------------
Term Loan C due 08/16/07 B1 990,000 992,062
------------------------------------------------------------------
Term Loan D due 08/12/07 B1 1,995,000 2,003,728
------------------------------------------------------------------
Thermadyne Holdings Corp.
Term Loan B due 05/22/05 B1 1,912,842 1,798,071
------------------------------------------------------------------
Term Loan C due 05/22/06 B1 1,912,842 1,798,071
------------------------------------------------------------------
9,878,994
------------------------------------------------------------------
LODGING-5.14%
Allegro Resorts Corp.
Term Loan B due 02/11/05 NR 5,000,000 4,800,000
------------------------------------------------------------------
Extended Stay America, Inc.
Term Loan B due 12/31/03 Ba3 4,950,000 4,940,719
------------------------------------------------------------------
Interval International Corp.
Term Loan B due 12/16/05 NR 2,018,220 2,005,606
------------------------------------------------------------------
Term Loan C due 12/15/06 NR 2,018,220 2,005,606
------------------------------------------------------------------
Strategic Hotel Capital
Funding, LLC
Term Loan B due 11/16/04 Ba3 4,975,000 4,981,219
------------------------------------------------------------------
Wyndham International, Inc.
Term Loan B due 06/30/06 B1 5,000,000 4,837,500
------------------------------------------------------------------
23,570,650
------------------------------------------------------------------
MEDIA-BROADCASTING-7.85%
Adelphia (Century Cable Holdings, LLC)
Term Loan B due 06/30/09 Ba2 5,500,000 5,518,909
------------------------------------------------------------------
AMFM Operating Inc.
Term Loan A due 11/30/01 Ba1 8,000,000 7,982,504
------------------------------------------------------------------
CC Michigan, LLC & CC New
England, LLC
Term Note B due 11/15/08 Ba3 3,200,000 3,200,000
------------------------------------------------------------------
Charter Communications
Operating
Term Loan B due 03/18/08 Ba3 5,000,000 4,964,380
------------------------------------------------------------------
ComCorp Broadcasting, Inc.
Term Loan B due 06/30/07 NR 2,230,780 2,208,472
------------------------------------------------------------------
Mediacom LLC
Term Loan B due 09/30/08 Ba3 2,500,000 2,493,750
------------------------------------------------------------------
RCN Corp.
Term Loan B due 06/03/07 B1 2,400,000 2,400,000
------------------------------------------------------------------
Satellite Mexicanos, S.A. de
C.V.
Term Loan due 06/30/04 B1 3,000,000 2,970,000
------------------------------------------------------------------
White Knight Broadcasting,
Inc.
Term Loan B due 06/30/07 NR 2,275,000 2,263,625
------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
MEDIA-BROADCASTING-(CONTINUED)
Young Broadcasting Inc.
Term Loan B due 12/31/06 Ba2 $2,000,000 $ 2,009,500
------------------------------------------------------------------
36,011,140
------------------------------------------------------------------
MEDIA-PUBLISHING-5.02%
American Media, Inc.
Term Loan B due 05/07/05 Ba3 1,000,000 1,000,000
------------------------------------------------------------------
Term Loan B due 05/07/07 Ba3 4,000,000 4,000,000
------------------------------------------------------------------
Enterprise Publishing Co.
Term Loan due 06/30/05 NR 4,616,368 4,616,368
------------------------------------------------------------------
Hollinger International Inc.
Term Loan due 12/30/04 Ba1 5,000,000 5,012,500
------------------------------------------------------------------
21st Century Newspapers, Inc.
Term Loan B due 09/15/05 NR 4,887,500 4,875,281
------------------------------------------------------------------
Ziff Davis Media Inc.
Term Loan B due 03/31/07 Ba3 3,500,000 3,506,563
------------------------------------------------------------------
23,010,712
------------------------------------------------------------------
MEDICAL & BIOTECHNOLOGY-1.09%
Quest Diagnostics Inc.
Term Loan B due 06/15/06 Ba3 2,593,387 2,604,733
------------------------------------------------------------------
Term Loan C due 06/15/06 Ba3 2,393,905 2,404,378
------------------------------------------------------------------
5,009,111
------------------------------------------------------------------
MEDICAL SUPPLIES-1.49%
Dade Behring, Inc.
Term Loan B due 06/30/06 Ba3 1,926,385 1,830,066
------------------------------------------------------------------
Term Loan C due 06/30/07 Ba3 1,926,385 1,830,066
------------------------------------------------------------------
Stryker Corp.
Term Loan C due 12/14/06 Ba2 3,162,114 3,170,677
------------------------------------------------------------------
6,830,809
------------------------------------------------------------------
OFFICE EQUIPMENT-3.33%
Buhrmann N.V.
Term Loan B due 10/26/07 Ba3 4,777,074 4,789,017
------------------------------------------------------------------
EMED Co., Inc.
Term Loan B due 07/21/06 NR 3,960,000 3,920,400
------------------------------------------------------------------
Identity Group
Term Loan B due 05/11/07 NR 4,962,500 4,218,125
------------------------------------------------------------------
20th Century Plastics
Term Loan B due 10/05/05 NR 1,290,112 1,238,508
------------------------------------------------------------------
Term Loan C due 10/06/05 NR 1,130,761 1,085,531
------------------------------------------------------------------
15,251,581
------------------------------------------------------------------
PAPER PRODUCTS-0.54%
Pacifica Papers Inc.
Term Loan B due 03/11/06 Ba2 2,475,000 2,481,188
------------------------------------------------------------------
PHARMACEUTICALS-1.45%
Endo Pharmaceuticals, Inc.
Term Loan B due 06/30/04 B1 2,370,005 2,334,455
------------------------------------------------------------------
Leiner Health Products Group,
Inc.
Term Loan C due 12/30/05 Ba3 4,383,620 4,295,947
------------------------------------------------------------------
6,630,402
------------------------------------------------------------------
</TABLE>
6
<PAGE> 9
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
POLLUTION CONTROL-WASTE
MANAGEMENT-3.22%
Allied Waste Industries, Inc.
Term Loan B due 08/02/06 Ba3 $4,545,454 $ 4,259,232
------------------------------------------------------------------
Term Loan C due 08/02/06 Ba3 5,454,546 5,111,078
------------------------------------------------------------------
Safety-Kleen Corp(c)(d)
Term Loan B due 04/03/05 Caa1 3,587,235 2,690,426
------------------------------------------------------------------
Term Loan C due 04/03/06 Caa1 3,587,235 2,690,426
------------------------------------------------------------------
14,751,162
------------------------------------------------------------------
RAILROADS-1.98%
RailAmerica, Inc.
Term Loan B due 02/04/07 Ba3 995,000 999,043
------------------------------------------------------------------
Railworks Corp.
Term Loan B due 10/20/06 B1 2,000,000 1,995,000
------------------------------------------------------------------
TFM, S.A. de C.V.
Term Loan A due 06/23/02 Ba3 2,541,176 2,531,647
------------------------------------------------------------------
Term Loan B due 12/23/02 Ba3 3,564,000 3,559,545
------------------------------------------------------------------
9,085,235
------------------------------------------------------------------
REAL ESTATE INVESTMENT TRUST-2.25%
Pebble Beach Co.
Term Loan B due 07/30/06 B1 1,869,091 1,874,543
------------------------------------------------------------------
RCPI Trust
Term Loan due 12/31/00 NR 3,390,802 3,404,255
------------------------------------------------------------------
Starwood Hotels & Resorts
Worldwide, Inc.
Term Loan due 02/23/03 Ba1 4,994,760 5,014,585
------------------------------------------------------------------
10,293,383
------------------------------------------------------------------
RECREATION-ENTERTAINMENT-0.43%
ClubCorp., Inc.
Term Loan B due 03/20/07 Ba3 1,995,000 1,995,000
------------------------------------------------------------------
RECREATION-OTHER-0.39%
KSL Recreation Group Inc.
Revolving Credit due
04/30/04 Ba3 4,040,816 403,200
------------------------------------------------------------------
Term Loan A due 04/30/05 Ba3 692,857 686,795
------------------------------------------------------------------
Term Loan B due 04/30/06 Ba3 692,857 686,795
------------------------------------------------------------------
1,776,790
------------------------------------------------------------------
RESTAURANTS-1.04%
AFC Enterprises, Inc.
Term Loan B due 06/30/04 Ba3 4,784,127 4,790,107
------------------------------------------------------------------
RETAILERS-BROADLINE-1.08%
Petco Animal Supplies, Inc.
Term Loan B due 04/29/06 B2 4,962,500 4,960,019
------------------------------------------------------------------
RETAILERS-DRUG BASED-1.08%
Duane Reade Inc.
Term Loan B due 02/15/03 B1 4,398,750 4,393,252
------------------------------------------------------------------
Term Loan C due 02/15/06 B1 552,665 552,204
------------------------------------------------------------------
4,945,456
------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MOODY'S PRINCIPAL MARKET
RATING AMOUNT VALUE
<S> <C> <C> <C>
SERVICES (COMPUTER SYSTEMS)-0.31%
DecisionOne Holdings Corp.(d)
Term Loan B due 08/06/05 NR $1,408,703 $ 1,408,703
------------------------------------------------------------------
SEMICONDUCTOR & RELATED-1.10%
Semiconductor Components
Group
Term Loan B due 08/06/06 Ba3 2,407,407 2,431,481
------------------------------------------------------------------
Term Loan C due 08/06/07 Ba3 2,592,593 2,618,519
------------------------------------------------------------------
5,050,000
------------------------------------------------------------------
SOFTWARE & PROCESSING-0.43%
Merrill Corp.
Term Loan B due 11/15/07 B1 1,990,000 1,991,658
------------------------------------------------------------------
STEEL-0.65%
Neenah Foundry Co.
Term Loan B due 09/30/05 B1 3,000,000 2,990,001
------------------------------------------------------------------
TELEPHONE SYSTEMS-4.67%
Centennial Cellular Corp.
Term Loan B due 05/31/07 B1 2,992,435 2,999,916
------------------------------------------------------------------
Nextel Communications Inc.
Term Loan B due 06/30/08 Ba2 3,000,000 3,013,125
------------------------------------------------------------------
Term Loan C due 12/31/08 Ba2 3,000,000 3,013,125
------------------------------------------------------------------
Tritel Holding Corp.
Term Loan B due 03/31/08 B2 5,000,000 5,005,000
------------------------------------------------------------------
VoiceStream PCS
Term Loan B due 06/30/07 B1 7,500,000 7,403,910
------------------------------------------------------------------
21,435,076
------------------------------------------------------------------
TEXTILES-SPECIALTY-0.43%
Polymer Group, Inc.
Term Loan C due 12/31/06 Ba3 2,000,000 1,992,500
------------------------------------------------------------------
Total Senior Secured
Floating Rate Interests
(Cost $445,778,427) 432,092,249
------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MATURITY
<S> <C> <C> <C>
COMMERCIAL PAPER-3.38%
Fort James Corp.
6.95% 07/07/00 7,100,000 7,094,517
-------------------------------------------------------------------
Safeway Inc.
7.15% 07/05/00 4,400,000 4,398,252
-------------------------------------------------------------------
Texas Utilities Co.
7.00% 07/07/00 4,000,000 3,996,889
-------------------------------------------------------------------
Total Commercial Paper
(Cost $15,489,658) 15,489,658
-------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
SHARES
<S> <C> <C> <C>
COMMON STOCKS-0.05%
SERVICES (COMPUTER SYSTEMS)-0.05%
DecisionOne Holdings
Corp.(d)(e) (Cost
$1,538,797) 37,286 222,000
------------------------------------------------------------------
</TABLE>
7
<PAGE> 10
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C> <C>
MONEY MARKET FUNDS-1.15%
STIC Liquid Assets
Portfolio(f) 2,638,581 2,638,581
------------------------------------------------------------------
STIC Prime Portfolio(f) 2,638,581 2,638,581
------------------------------------------------------------------
Total Money Market Funds
(Cost $5,277,162) 5,277,162
------------------------------------------------------------------
TOTAL INVESTMENTS-98.82%
(Cost $468,084,044) 453,081,069
------------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-1.18% 5,406,176
------------------------------------------------------------------
NET ASSETS-100% $458,487,245
==================================================================
</TABLE>
Abbreviations:
NR - Not Rated
Notes to Schedule of Investments:
(a) Senior secured corporate loans and senior secured debt securities in the
Fund's portfolio generally have variable rates which adjust to a base, such
as the London Inter-Bank Offered Rate ("LIBOR"), on set dates, typically
every 30 days but not greater than one year; and/or have interest rates that
float at a margin above a widely recognized base lending rate such as the
Prime Rate of a designated U.S. bank. Senior secured floating rate interests
are, at present, not readily marketable and may be subject to restrictions
on resale.
(b) Senior secured floating rate interests often require prepayments from excess
cash flow or permit the borrower to repay at its election. The degree to
which borrowers repay, whether as a contractual requirement or at their
election, cannot be predicted with accuracy. As a result, the actual
remaining maturity may be substantially less than the stated maturities
shown. However, it is anticipated that the senior secured floating rate
interests will have a expected average life of three to five years.
(c) Defaulted security. Currently, the issuer is in default with respect to
interest payments.
(d) Security fair valued in accordance with the procedures established by the
Board of Trustees.
(e) Non-income producing security received as a result of bankruptcy
proceedings.
(f) The money market fund has the same investment advisor as the Fund.
See Notes to Financial Statements.
8
<PAGE> 11
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2000
(Unaudited)
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$468,084,044) $453,081,069
---------------------------------------------------------
Receivables for:
Fund shares sold 4,176,531
---------------------------------------------------------
Dividends and interest 3,674,835
---------------------------------------------------------
Unamortized organizational costs 77,842
---------------------------------------------------------
Total assets 461,010,277
---------------------------------------------------------
LIABILITIES:
Payables for:
Fund shares reacquired 9,913
---------------------------------------------------------
Deferred facility fees 272,522
---------------------------------------------------------
Dividends 1,469,833
---------------------------------------------------------
Accrued advisory fees 382,869
---------------------------------------------------------
Accrued administrative services fees 12,297
---------------------------------------------------------
Accrued distribution fees 281,530
---------------------------------------------------------
Accrued trustees' fees 4,646
---------------------------------------------------------
Accrued transfer agent fees 35,183
---------------------------------------------------------
Accrued operating expenses 54,239
---------------------------------------------------------
Total liabilities 2,523,032
---------------------------------------------------------
Net assets applicable to shares outstanding $458,487,245
=========================================================
NET ASSETS:
Class B $451,675,621
=========================================================
Class C $ 6,811,624
=========================================================
SHARES OUTSTANDING, $0.001 PAR VALUE PER
SHARE:
Class B 47,146,956
=========================================================
Class C 711,988
=========================================================
Class B:
Net asset value and offering price per
share $ 9.58
=========================================================
Class C:
Net asset value and offering price per
share $ 9.57
=========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the six months ended June 30, 2000
(Unaudited)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest $20,489,748
---------------------------------------------------------
Dividends 171,446
---------------------------------------------------------
Facility fees earned 414,230
---------------------------------------------------------
Total investment income 21,075,424
---------------------------------------------------------
EXPENSES:
Advisory fees 2,425,254
---------------------------------------------------------
Administrative services fee 51,252
---------------------------------------------------------
Custodian fees 27,715
---------------------------------------------------------
Distribution fees -- Class B 282,639
---------------------------------------------------------
Distribution fees -- Class C 3,708
---------------------------------------------------------
Interest 36,045
---------------------------------------------------------
Transfer agent fees 187,887
---------------------------------------------------------
Trustees' fees 9,842
---------------------------------------------------------
Other 410,106
---------------------------------------------------------
Total expenses 3,434,448
---------------------------------------------------------
Less: Fees waived (12,202)
---------------------------------------------------------
Expenses paid indirectly (7,978)
---------------------------------------------------------
Net expenses 3,414,268
---------------------------------------------------------
Net investment income 17,661,156
---------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES
Net realized gain (loss) from investment
securities (170,596)
---------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of investment securities (4,490,545)
---------------------------------------------------------
Net gain (loss) from investment securities (4,661,141)
---------------------------------------------------------
Net increase in net assets resulting from
operations $13,000,015
=========================================================
</TABLE>
See Notes to Financial Statements.
9
<PAGE> 12
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended June 30, 2000 and the year ended December 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 17,661,156 $ 25,575,310
------------------------------------------------------------------------------------------
Net realized gain (loss) from investment securities (170,596) (515,356)
------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of
investment securities (4,490,545) (5,999,961)
------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 13,000,015 19,059,993
------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class B (17,636,863) (25,583,506)
------------------------------------------------------------------------------------------
Class C (37,063) --
------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains --
Class B -- (22,939)
------------------------------------------------------------------------------------------
Share transactions-net:
Class B 16,818,389 157,995,609
------------------------------------------------------------------------------------------
Class C 6,820,044 --
------------------------------------------------------------------------------------------
Net increase in net assets 18,964,522 151,449,157
------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 439,522,723 288,073,566
------------------------------------------------------------------------------------------
End of period $458,487,245 $439,522,723
==========================================================================================
NET ASSETS CONSIST OF:
Shares of beneficial interest $474,048,279 $450,409,846
------------------------------------------------------------------------------------------
Undistributed net investment income 140,323 153,093
------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities (698,382) (527,786)
------------------------------------------------------------------------------------------
Unrealized appreciation (depreciation) of investment
securities (15,002,975) (10,512,430)
------------------------------------------------------------------------------------------
$458,487,245 $439,522,723
==========================================================================================
</TABLE>
See Notes to Financial Statements.
10
<PAGE> 13
STATEMENT OF CASH FLOWS
For the six months ended June 30, 2000
(Unaudited)
<TABLE>
<S> <C>
CASH PROVIDED BY OPERATING ACTIVITIES:
Net increase in net assets resulting from operations $ 13,000,015
-----------------------------------------------------------------------------
ADJUSTMENTS TO RECONCILE NET INCREASE IN NET ASSETS FROM
OPERATIONS TO NET CASH USED IN OPERATING ACTIVITIES:
Increase in receivables (271,991)
-----------------------------------------------------------------------------
Increase in payables 366,813
-----------------------------------------------------------------------------
Net realized and unrealized gain on investments 4,661,141
-----------------------------------------------------------------------------
Decrease in deferred facility fees (83,217)
-----------------------------------------------------------------------------
Decrease in unamortized organizational costs 21,061
-----------------------------------------------------------------------------
Net cash provided by operating activities 17,693,822
-----------------------------------------------------------------------------
CASH USED FOR INVESTING ACTIVITIES:
Proceeds from principal payments and sales of senior
floating rate interests 83,148,956
-----------------------------------------------------------------------------
Purchases of senior secured floating rate interests (119,988,424)
-----------------------------------------------------------------------------
Purchases of short-term investments (2,091,185,503)
-----------------------------------------------------------------------------
Proceeds from sales and maturities of short-term
investments 2,106,640,522
-----------------------------------------------------------------------------
Net cash provided by (used in) investing
activities (21,384,449)
-----------------------------------------------------------------------------
CASH PROVIDED BY FINANCING ACTIVITIES:
Proceeds from capital shares sold and reinvested 74,224,169
-----------------------------------------------------------------------------
Disbursements from capital shares repurchased (61,545,967)
-----------------------------------------------------------------------------
Dividends paid to shareholders (8,622,917)
-----------------------------------------------------------------------------
Net cash provided by financing activities 4,055,285
-----------------------------------------------------------------------------
Net increase in cash 364,658
-----------------------------------------------------------------------------
Cash at beginning of period (364,658)
-----------------------------------------------------------------------------
Cash at end of period $ --
=============================================================================
Non-cash financing activities:
Value of capital shares issued in reinvestment of
dividends paid to shareholders $ 9,138,688
=============================================================================
</TABLE>
See Notes to Financial Statements.
11
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS
June 30, 2000
(Unaudited)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Floating Rate Fund, (the "Fund"), is organized as a Delaware business trust
and is registered under the Investment Company Act of 1940, as amended ("1940
Act"), as a continuously offered non-diversified, closed-end management
investment company. At a Special Meeting of Shareholders on February 25, 2000,
shareholders approved a restructuring of the Fund (the "Restructuring")
effective April 3, 2000. The Restructuring included reorganizing the Fund from a
Maryland Corporation to a Delaware business trust and eliminating the
"master/feeder" investment structure. The Restructuring also allows the Fund to
offer multiple classes of shares with different distribution plans and commits
the Fund to making repurchase offers each quarter, thereby assuring shareholders
of at least partial liquidity for their shares. The Fund currently offers two
different classes of shares: Class B shares and Class C shares, both of which
are sold with a contingent deferred sales charge. Class C shares commenced sales
on April 3, 2000. Matters affecting each portfolio or class will be voted on
exclusively by the shareholders of such portfolio or class. The Fund's
investment objective is to provide as high a level of current income and
preservation of capital as is consistent with investment in senior secured
corporate loans and senior secured debt securities that meet credit standards
established by the investment manager.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates. The
following is a summary of the significant accounting policies followed by the
Fund in the preparation of its financial statements.
A. Security Valuations -- The Fund invests primarily in senior secured corporate
loans ("Corporate Loans") and senior secured debt securities ("Corporate Debt
Securities") that meet credit standards established by INVESCO Senior Secured
Management, Inc., (the "Sub-advisor"). When possible, A I M Advisors, Inc.
("AIM") or the Sub-advisor will rely on quotations provided by banks, dealers
or pricing services with respect to Corporate Loans and Corporate Debt
Securities. Whenever it is not possible to obtain such quotes, the Sub-
advisor, subject to guidelines reviewed by the Fund's Board of Trustees,
values the Corporate Loans and Corporate Debt Securities at fair value, which
approximates market value. In valuing a Corporate Loan or Corporate Debt
Security, the Sub-advisor considers, among other factors, (1) the credit
worthiness of the U.S. or non-U.S. Company borrowing or issuing Corporate
Debt Securities and any intermediate loan participants; (2) the current
interest rate, period until next interest rate reset and maturity of the
Corporate Loan or Corporate Debt Security; (3) recent prices in the market
for instruments of similar quality, rate, period until next interest rate
reset and maturity; and (4) supply and demand in the market.
B. Securities Transactions and Investment Income -- Securities transactions are
accounted for on a trade date basis. Realized gains or losses on sales are
computed on the basis of specific identification of the securities sold.
Interest income is recorded on the accrual basis from settlement date.
Dividend income is recorded on the ex-dividend date.
C. Distributions -- It is the policy of the Fund to declare daily dividends from
net investment income. Such distributions are paid monthly. Distributions
from net realized capital gains, if any, are generally paid annually and
recorded on ex-dividend date. The Fund may elect to use a portion of the
proceeds of fund share redemptions as distributions for federal income tax
purposes.
D. Federal Income Taxes -- The Fund intends to comply with the requirements of
the Internal Revenue Code necessary to qualify as a regulated investment
company and, as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) which is
distributed to shareholders. Therefore, no provision for federal income taxes
is recorded in the financial statements.
The Fund has a capital loss carryforward of $525,269 which may be carried
forward to offset future taxable gains, if any, which expires in varying
increments, if not previously utilized, in the year 2007.
E. Intermediate Participants -- The Fund invests in Corporate Loans from U.S. or
non-U.S. companies (the "Borrowers"). The investment of the Fund in a
Corporate Loan may take the form of participation interests or assignments.
If the Fund purchases a participation interest from a syndicate of lenders
("Lenders") or one of the participants in the syndicate ("Participant"), one
or more of which administers the loan on behalf of all the Lenders (the
"Agent Bank"), the Fund would be required to rely on the Lender that sold the
participation interest not only for the enforcement of the Fund's rights
against the Borrower but also for the receipt and processing of payments due
to the Fund under the Corporate Loans. As such, the Fund is subject to the
credit risk of the Borrower and the Participant. Lenders and Participants
interposed between the Fund and a Borrower, together with Agent Banks, are
referred to as "Intermediate Participants".
F. Securities Purchased on a When-Issued and Delayed Delivery Basis -- The Fund
may purchase and sell interests in Corporate Loans and Corporate Debt
Securities and other portfolio securities on a when-issued and delayed
delivery basis, with payment and delivery scheduled for a future date. No
income accrues to the Fund on such interests or securities in connection with
such transactions prior to the date the Fund actually takes delivery of such
interests or securities. These
12
<PAGE> 15
transactions are subject to market fluctuations and are subject to the risk
that the value at delivery may be more or less than the trade date purchase
price. Although the Fund will generally purchase these securities with the
intention of acquiring such securities, they may sell such securities before
the settlement date.
G. Deferred Organizational Expenses -- Expenses incurred by the Fund in
connection with its organization aggregated $233,411. These expenses are
being amortized on a straight-line basis over a five-year period.
H. Expenses -- Distribution expenses directly attributable to a class of shares
are charged to that class' operations. All other expenses which are
attributable to more than one class are allocated among the classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Fund's investment manager and administrator.
The Fund pays AIM investment management and administration fees at an annual
rate of 0.95% of the Fund's average daily net assets. Under the terms of a
master sub-advisory agreement between AIM and INVESCO Senior Secured Management,
Inc. ("ISSM"), AIM pays ISSM 48% of the amount paid by the Fund to AIM. AIM has
contractually agreed to limit the Fund's expenses (exclusive of brokerage
commissions, taxes, interest, extraordinary items and increases in expenses due
to offset arrangement, if any) to the annual rate of 1.50% and 1.75% of the
average daily net assets of the Fund for Class B shares and Class C shares,
respectively. During the six months ended June 30, 2000, AIM waived fees of
$10,966.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to pay AIM for certain administrative costs incurred in providing
accounting services to the Fund. For the six months ended June 30, 2000, AIM was
paid $51,252 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency and
shareholder services to the Fund. For the six months ended June 30, 2000, AFS
was paid $53,766 for such services.
Effective April 3, 2000, the Trust entered into master distribution agreements
with A I M Distributors, Inc. ("AIM Distributors") to serve as the distributor
for the Class B and Class C shares of the Fund. The Trust has adopted plans
pursuant to Rule 12b-1 under the 1940 Act with respect to the Fund's Class B
shares and Class C shares (collectively the "Plans"). The Fund, pursuant to the
Plans, pays AIM Distributors compensation at the annual rate of 0.25% of the
Fund's average daily net assets of Class B shares and 0.75% of the average daily
net assets of Class C shares. AIM Distributors has agreed to limit the Class C
shares plan payments to 0.50%. Of these amounts, the Fund may pay a service fee
of 0.25% of the average daily net assets of the Class B or Class C shares to
selected dealers and financial institutions who furnish continuing personal
shareholder services to their customers who purchase and own the appropriate
class of shares of the Fund. Any amounts not paid as a service fee under the
Plans would constitute an asset-based sales charge. The Plans also impose a cap
on the total sales charges, including asset-based sales charges that may be paid
by the respective classes. For the six months ended June 30, 2000 for Class B
shares and for the period April 3, 2000 (date sales commenced) through June 30,
2000 for Class C shares, the Class B and Class C shares paid AIM Distributors
$282,639 and $2,472, respectively, as compensation under the Plans. During the
period April 3, 2000 (date Class C shares sales commenced ) through June 30,
2000, AIM Distributors waived fees of $1,236 for Class C shares.
AIM Distributors did not receive any commissions from sales of shares of the
Fund during the six months ended June 30, 2000. During the six months ended June
30, 2000, AIM Distributors received $984,329 in early withdrawal sales charges
imposed on redemptions of Fund shares.
Certain officers and trustees of the Trust are officers and directors of AIM,
AFS and AIM Distributors.
NOTE 3-INDIRECT EXPENSES
For the six months ended June 30, 2000, the Fund received reductions in
custodian fees and in transfer agency fees from AFS (an affiliate of AIM) of
$5,530 and $2,448, respectively, under expense offset arrangements which
resulted in a reduction of the Fund's total expenses of $7,978.
NOTE 4-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by Citibank, N.A. The Fund may borrow up to the lesser of
(i) $1,000,000,000 or (ii) the limits set by its prospectus for borrowings. The
Fund and other funds advised by AIM which are parties to the line of credit may
borrow on a first come, first served basis. During the six months ended June 30,
2000, the Fund did not borrow under the line of credit agreement. The funds
which are party to the line of credit are charged a commitment fee of 0.09% on
the unused balance of the committed line. The commitment fee is allocated among
the funds based on their respective average net assets for the period.
NOTE 5-REPURCHASE OFFERS
The Fund is committed to conducting quarterly Repurchase Offers which are offers
by the Fund to repurchase at least 5% and up to 25% of its shares. In each
Repurchase Offer, the repurchase price will be the net asset value determined
not more than 14 days following the repurchase request deadline and payment for
all shares repurchased pursuant to these offers will be made not later than 7
days after the repurchase pricing date. Shares held less than four years and
which are repurchased by the Fund pursuant to Repurchase Offers will be subject
to an early withdrawal charge of up to 3% of the lesser of the then current net
asset value or the original purchase price of the shares being tendered.
13
<PAGE> 16
NOTE 6-UNFUNDED LOAN COMMITMENTS
As of June 30, 2000, the Fund had unfunded loan commitments of $4,006,720, which
could be extended at the option of the borrower, pursuant to the following loan
agreements:
<TABLE>
<CAPTION>
UNFUNDED
BORROWER COMMITMENTS
-------- -----------
<S> <C>
Genicom Corp. $ 360,808
-------------------------------------------------------------------------
KSL Recreation Group, Inc. 3,629,386
-------------------------------------------------------------------------
RCPI Trust 744,680
-------------------------------------------------------------------------
$4,734,874
=========================================================================
</TABLE>
NOTE 7-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Portfolio during the six months ended June 30, 2000
was $114,711,261 and $42,836,552, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of June 30, 2000 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of investment securities $ 1,760,732
--------------------------------------------------------------------------
Aggregate unrealized (depreciation) of investment securities (16,763,707)
--------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investment
securities $(15,002,975)
==========================================================================
Investments have the same cost for tax and financial statement purposes.
</TABLE>
NOTE 8-SHARE INFORMATION
Changes in shares outstanding during the six months ended June 30, 2000 and the
year ended December 31, 1999 were as follows:
<TABLE>
<CAPTION>
JUNE 30, 2000 DECEMBER 31, 1999
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Sold:
Class B 7,185,216 $ 69,262,826 19,808,989 $193,807,530
----------------------------------------------------------------------------------------------------------------------
Class C* 709,141 6,792,799 -- --
----------------------------------------------------------------------------------------------------------------------
Issued as reinvestment of dividends:
Class B 946,830 9,111,443 1,398,875 13,669,943
----------------------------------------------------------------------------------------------------------------------
Class C* 2,847 27,245 -- --
----------------------------------------------------------------------------------------------------------------------
Reacquired:
Class B (6,395,165) (61,555,880) (5,067,050) (49,481,864)
----------------------------------------------------------------------------------------------------------------------
2,448,869 $ 23,638,433 16,140,814 $157,995,609
======================================================================================================================
</TABLE>
* Class C shares commenced sales on April 3, 2000.
14
<PAGE> 17
NOTE 9-FINANCIAL HIGHLIGHTS
The following schedule presents financial highlights for one share of the Fund
outstanding throughout the periods indicated.
<TABLE>
<CAPTION>
CLASS B
-------------------------------------------
DECEMBER 31,
JUNE 30, ------------------------------
2000 1999(a) 1998 1997
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 9.68 $ 9.84 $ 10.02 $ 10.00
------------------------------------------------------------ -------- -------- -------- --------
Income from investment operations:
Net investment income 0.38 0.69 0.68 0.46
------------------------------------------------------------ -------- -------- -------- --------
Net gains (losses) on securities (both realized and
unrealized) (0.10) (0.16) (0.18) 0.02
------------------------------------------------------------ -------- -------- -------- --------
Total from investment operations 0.28 0.53 0.50 0.48
------------------------------------------------------------ -------- -------- -------- --------
Less distributions:
Dividends from net investment income (0.38) (0.69) (0.67) (0.46)
------------------------------------------------------------ -------- -------- -------- --------
Distributions from net realized gains -- -- (0.01) --
------------------------------------------------------------ -------- -------- -------- --------
Total distributions (0.38) (0.69) (0.68) (0.46)
------------------------------------------------------------ -------- -------- -------- --------
Net asset value, end of period $ 9.58 $ 9.68 $ 9.84 $ 10.02
============================================================ ======== ======== ======== ========
Total return(b) 2.90% 5.49% 5.25% 5.04%
============================================================ ======== ======== ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $451,676 $439,523 $288,074 $161,697
============================================================ ======== ======== ======== ========
Ratio of expenses to average net assets (including interest
expense):
With fee waivers 1.52%(c) 1.47% 1.51% 1.65%(d)
------------------------------------------------------------ -------- -------- -------- --------
Without fee waivers 1.53%(c) 1.52% 1.64% 2.67%(d)
============================================================ ======== ======== ======== ========
Ratio of expenses to average net assets (excluding interest
expense):
With fee waivers 1.50%(c) 1.47% 1.50% 1.50%(d)
------------------------------------------------------------ -------- -------- -------- --------
Without fee waivers 1.51%(c) 1.52% 1.63% 2.52%(d)
============================================================ ======== ======== ======== ========
Ratio of net investment income to average net assets 7.84%(c) 7.02% 6.88% 7.26%(d)
============================================================ ======== ======== ======== ========
Ratio of interest expense to average net assets 0.02%(c) N/A 0.01% 0.15%(d)
============================================================ ======== ======== ======== ========
Portfolio turnover rate 19% 81% 75% 118%
============================================================ ======== ======== ======== ========
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not include withdrawal charges and is not annualized for periods less
than one year.
(c) Ratios are annualized and based on average net assets of $451,890,198.
(d) Annualized.
<TABLE>
<CAPTION>
CLASS C
----------------------
APRIL 3, 2000
(DATE SALES COMMENCED)
TO JUNE 30,
2000
----------------------
<S> <C>
Net asset value, beginning of period $ 9.63
------------------------------------------------------------ ------
Income from investment operations:
Net investment income 0.20
------------------------------------------------------------ ------
Net gains (losses) on securities (both realized and
unrealized) (0.06)
------------------------------------------------------------ ------
Total from investment operations 0.14
------------------------------------------------------------ ------
Less distributions from net investment income (0.20)
------------------------------------------------------------ ------
Net asset value, end of period $ 9.57
============================================================ ======
Total return(a) 1.40%
============================================================ ======
Ratios/supplemental data:
Net assets, end of period (000s omitted) $6,812
============================================================ ======
Ratio of expenses to average net assets (including interest
expense):
With fee waivers 1.77%(b)
------------------------------------------------------------ ------
Without fee waivers 1.98%(b)
============================================================ ======
Ratio of expenses to average net assets (excluding interest
expense):
With fee waivers 1.75%(b)
------------------------------------------------------------ ------
Without fee waivers 1.96%(b)
============================================================ ======
Ratio of net investment income to average net assets 7.64%(b)
============================================================ ======
Ratio of interest expense to average net assets 0.02%(b)
============================================================ ======
Portfolio turnover rate 19%
============================================================ ======
</TABLE>
(a) Does not include withdrawal charges and is not annualized for periods less
than one year.
(b) Ratios are annualized and based on average net assets of $1,961,604.
15
<PAGE> 18
AIM FLOATING RATE FUND
A Special Meeting of Shareholders of GT Global Floating Rate Fund, Inc. (d/b/a
AIM Floating Rate Fund) (the "Fund"), a Maryland corporation reorganized as AIM
Floating Rate Fund, a Delaware business trust, was held on February 25, 2000.
The meeting was held for the following purposes:
(1) To approve an agreement and plan of conversion and liquidation for the Fund.
(2) To approve a distribution plan.
(3) To elect a Director.
(4) To ratify the selection of PricewaterhouseCoopers LLP as the Fund's
independent public accountants.
The results of the proxy solicitation on the above matters were as follows:
<TABLE>
<CAPTION>
VOTES WITHHELD/
MATTER VOTES FOR AGAINST ABSTENTIONS
------ ---------- ------- -----------
<S> <C> <C> <C> <C>
(1) To Approve an Agreement and Plan of Conversion and
Liquidation for the Fund.................................... 24,037,611 627,086 15,099,765*
(2) To Approve a Distribution Plan.............................. 24,178,788 592,149 14,993,525*
(3) To Elect a Director......................................... 38,441,463 N/A 1,322,999
(4) To Ratify the selection of PricewaterhouseCoopers LLP as the
Fund's Independent Public Accountants....................... 37,925,309 343,593 1,495,560
</TABLE>
---------------
*Includes Broker Non-Votes
16
<PAGE> 19
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
C. Derek Anderson Robert H. Graham 11 Greenway Plaza
Senior Managing Partner, Chairman and President Suite 100
Plantagenet Capital Management, LLC Houston, TX 77046
(an investment partnership); Dana R. Sutton
Chief Executive Officer, Vice President and Treasurer INVESTMENT MANAGER
Plantagenet Holdings, Ltd.
(an investment banking firm) Samuel D. Sirko A I M Advisors, Inc.
Vice President and Secretary 11 Greenway Plaza
Frank S. Bayley Suite 100
Partner, law firm of Melville B. Cox Houston, TX 77046
Baker & McKenzie Vice President
SUB-ADVISOR
Robert H. Graham Gary T. Crum
Director, President and Chief Executive Officer, Vice President INVESCO Senior Secured Management, Inc.
A I M Management Group Inc. 1166 Avenue of the Americas
Carol F. Relihan New York, NY 11036
Ruth H. Quigley Vice President
Private Investor SUB-SUB-ADVISOR
Mary J. Benson
Assistant Vice President and INVESCO (NY), Inc.
Assistant Treasurer 1166 Avenue of the Americas
New York, NY 10036
Sheri Morris
Assistant Vice President and TRANSFER AGENT
Assistant Treasurer
A I M Fund Services, Inc.
Nancy L. Martin P.O. Box 4739
Assistant Secretary Houston, TX 77210-4739
Ofelia M. Mayo CUSTODIAN
Assistant Secretary
State Street Bank and Trust Company
Kathleen J. Pflueger 225 Franklin Street
Assistant Secretary Boston, MA 02110
COUNSEL TO THE FUND
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, D.C. 20036-1800
COUNSEL TO THE DIRECTORS
Paul, Hastings, Janofsky & Walker LLP
Twenty Third Floor
555 South Flower Street
Los Angeles, CA 90071
DISTRIBUTOR
A I M Distributors, Inc.
11 Greenway Plaza
Suite 100
Houston, TX 77046
</TABLE>
<PAGE> 20
THE AIM FAMILY OF FUNDS--Registered Trademark--
<TABLE>
<S> <C> <C>
EQUITY FUNDS
DOMESTIC EQUITY FUNDS INTERNATIONAL/GLOBAL EQUITY FUNDS A I M Management Group Inc. has provided
leadership in the mutual fund industry
MORE AGGRESSIVE MORE AGGRESSIVE since 1976 and managed approximately $176
billion in assets for more than 8 million
shareholders, including individual
AIM Small Cap Opportunities(1) AIM Latin American Growth investors, corporate clients and financial
AIM Mid Cap Opportunities(2) AIM Developing Markets institutions, as of June 30, 2000.
AIM Large Cap Opportunities AIM Asian Growth The AIM Family of Funds--Registered
AIM Emerging Growth AIM Japan Growth Trademark-- is distributed nationwide, and
AIM Small Cap Growth(3) AIM European Development AIM today is the eighth-largest mutual
AIM Aggressive Growth AIM Euroland Growth(5) fund complex in the United States in
AIM Mid Cap Growth AIM Global Aggressive Growth assets under management, according to
AIM Capital Development AIM International Equity Strategic Insight, an independent mutual
AIM Constellation(4) AIM Advisor International Value fund monitor.
AIM Dent Demographic Trends AIM Global Trends(6) AIM is a subsidiary of AMVESCAP PLC,
AIM Select Growth AIM Global Growth one of the world's largest independent
AIM Large Cap Growth financial services companies with $389
AIM Weingarten MORE CONSERVATIVE billion in assets under management as of
AIM Mid Cap Equity June 30, 2000.
AIM Charter SECTOR EQUITY FUNDS
AIM Value
AIM Blue Chip MORE AGGRESSIVE
AIM Basic Value
AIM Large Cap Basic Value AIM Global Telecommunications and Technology
AIM Balanced AIM Global Resources
AIM Advisor Flex AIM Global Financial Services
AIM Global Health Care
MORE CONSERVATIVE AIM Global Consumer Products and Services
AIM Global Infrastructure
AIM Advisor Real Estate
AIM Global Utilities
MORE CONSERVATIVE
FIXED-INCOME FUNDS
TAXABLE FIXED-INCOME FUNDS TAX-FREE FIXED-INCOME FUNDS
MORE AGGRESSIVE MORE AGGRESSIVE
AIM Strategic Income AIM High Income Municipal
AIM High Yield II AIM Tax-Exempt Bond of Connecticut
AIM High Yield AIM Municipal Bond
AIM Income AIM Tax-Free Intermediate
AIM Global Income AIM Tax-Exempt Cash
AIM Floating Rate(7)
AIM Intermediate Government MORE CONSERVATIVE
AIM Limited Maturity Treasury
AIM Money Market
MORE CONSERVATIVE
</TABLE>
The AIM Risk Spectrum illustrates equity and fixed-income funds from more
aggressive to more conservative. When assessing the degree of risk, three
factors were considered: the funds portfolio holdings, volatility patterns over
time and diversification permitted within the fund. Fund rankings are relative
to one another within The AIM Family of Funds--Registered Trademark-- and should
not be compared with other investments. There is no guarantee that any one AIM
fund will be less volatile than any other. (1) AIM Small Cap Opportunities Fund
closed to new investors Nov. 4, 1999. (2) AIM Mid Cap Opportunities Fund closed
to new investors March 21, 2000. (3) AIM Small Cap Growth Fund closed to new
investors Nov. 8, 1999. (4) AIM Constellation Fund's investment strategy
broadened to allow investments across all market capitalizations Dec. 1, 1999.
(5) AIM Europe Growth Fund was renamed AIM Euroland Growth Fund Sept. 1, 1999.
(6) AIM Global Trends Fund was restructured to operate as a traditional mutual
fund Aug. 27, 1999. Previously, the fund operated as a fund of funds. (7) AIM
Floating Rate Fund was restructured to offer multiple share classes April 3,
2000. Existing shares were converted to Class B shares, and Class C shares
commenced offering.
FOR MORE COMPLETE INFORMATION ABOUT ANY AIM FUND, INCLUDING SALES CHARGES
AND EXPENSES, OBTAIN THE APPROPRIATE PROSPECTUS(ES) FROM YOUR FINANCIAL ADVISOR.
PLEASE READ THE PROSPECTUS(ES) CAREFULLY BEFORE YOU INVEST OR SEND MONEY. This
report is not authorized for distribution to prospective investors unless
preceded or accompanied by a currently effective fund prospectus. If used as
sales material after Oct. 20, 2000, this report must be accompanied by a fund
Performance & Commentary or by an AIM Quarterly Review of Performance for the
most recent quarter end.
[DALBAR LOGO APPEARS HERE] [AIM LOGO APPEARS HERE]
--Registered Trademark--
INVEST WITH DISCIPLINE
--Registered Trademark--
A I M Distributors, Inc. FLR-SAR-1
