<PAGE> 1
ANNUAL REPORT / OCTOBER 31 1999
AIM WEINGARTEN FUND
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[AIM LOGO APPEARS HERE]
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THE VIOLIN BOX
BY SUZANNE VALADON (1865-1938, FRENCH)
IN THE ART OF INVESTING, SUCCESS DOES NOT ALWAYS COME IN AN
INSTANT--IT IS USUALLY ACHIEVED OVER TIME. VALADON'S UNFORGETTABLE
OILS MAKE THIS POINT, OFTEN TAKING 13 YEARS OF DEDICATION
AND DILIGENCE TO COMPLETE. HER RICHLY COLORED "VIOLIN BOX"
REMINDS US THAT ALL GOOD THINGS ARE WORTH THE WAIT.
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AIM Weingarten Fund is for shareholders who seek long-term growth of capital
through investments primarily in common stocks of leading U.S. companies
considered by management to have strong earnings momentum.
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Weingarten Fund's performance figures are historical and reflect
reinvestment of all distributions and changes in net asset value.
o Had fees and expenses not been waived during the reporting period, returns
would have been lower.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 5.50% sales charge, and Class B and Class C
share performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the fund's Class B and Class C shares will differ from
that of Class A shares due to differences in sales charge structure and
expenses.
o The fund's average annual total returns, including sales charges, for
periods ended 9/30/99 (the most recent calendar quarter-end) are as follows.
For Class A shares, one year, 32.12%; five years, 22.05%; 10 years, 15.51%.
For Class B shares, one year, 33.64%; inception (6/26/95), 21.33%. For Class
C shares, one year, 37.67%; inception (8/4/97), 18.36%.
o During the fiscal year ended 10/31/99, the fund paid distributions of
$1.4718 per share for Class A shares and $1.4576 per share for Class B and
Class C shares.
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 Dow Jones Industrial Average (the Dow) is a price-weighted average of 30
actively traded primarily industrial stocks.
o The unmanaged Lipper Growth Funds Index represents an average of the
performance of the 30 largest growth funds charted by Lipper Inc., an
independent mutual fund performance monitor.
o The unmanaged Russell 1000 Index is generally considered representative of
large-capitalization stocks.
o The unmanaged Standard & Poor's Composite Index of 500 Stocks (S&P 500) is
widely regarded by investors to be representative of the stock market in
general.
o An investment cannot be made in any index listed. Unless otherwise
indicated, index results include reinvested dividends and 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 WEINGARTEN FUND
<PAGE> 3
ANNUAL REPORT / CHAIRMAN'S LETTER
Dear Fellow Shareholder:
The fiscal year discussed in this report reconfirmed our
[PHOTO OF faith in two long-established principles of investing:
Charles T. portfolio diversification and long-term thinking. We could
Bauer, title this report "What a Difference a Year Makes."
Chairman of An investor surveying conditions when the fiscal year
the Board of opened on October 31, 1998, saw a market dominated by
THE FUND large-capitalization stocks and high-quality bonds,
APPEARS HERE] especially U.S. Treasuries. Ten months into 1998, two
well-known indexes of large-capitalization U.S. company
stocks, the S&P 500 and the Dow Jones Industrial Average,
were up by double digits, but the smaller-company stocks in
the Russell 2000 had lost 12.80%. Overseas, many markets
were languishing, especially in Asia, where many financial
difficulties originated in 1997.
In bond markets also, name-brand quality was the place
to be. The Lehman Corporate/Government Bond Index, which
follows intermediate and long-term government and investment-grade debt, was up
8.56%, while the Lehman High Yield Index, which tracks riskier "junk bonds," had
dropped 2.30%.
It would be easy for an investor to conclude that blue chips, whether equity
or fixed-income, were the only place to be. That investor, of course, would be
wrong.
MARKETS TURN
While large-capitalization stocks continue to do very well, during 1999 markets
broadened considerably, with many investment sectors performing a complete
turnaround. Year to date by October 31, 1999, the small-cap stocks in the
Russell 2000 were back in positive territory, and the many Asian markets had
staged a comeback. The same holds true for bonds. The higher-quality Lehman
index is down 1.49% year to date through October 31, 1999, while high-yield
bonds have moved into positive returns.
The point, at the risk of sounding repetitive to those of you who have
invested with us for a long time, is that this is why diversification is a
fundamental investing principle. Market sectors and asset classes go in and out
of favor, but over the long run--and the long run is several years--the markets'
overall trend has been upward. Selecting an asset class or a market sector on
the basis of a short-term snapshot of conditions is usually unwise, as is
concentrating your portfolio in one asset class. Staying fully invested in a
diversified portfolio remains a compelling strategy and one of your best
prospects for long-term gain.
LOOKING AHEAD
As we look about at the close of this fiscal year, we are encouraged by signs of
economic health in Europe and Asia, not to mention the prolonged U.S. economic
expansion. However, we are aware of how easily an investor could have been
misled by conditions just 12 months ago. For our shareholders, we therefore
reiterate our commitment to investing through a financial advisor. In addition
to helping you select investments appropriate to your time horizon and risk
tolerance, a financial advisor can keep you informed about how changing market
conditions affect you and your portfolio and can help assure that when you do
alter your investments, there's a logical reason for doing so. AIM believes
every investor should be guided by a financial professional.
FUND MANAGERS COMMENT
In the pages that follow, your fund's portfolio managers discuss how they
managed your fund during the year ended October 31, 1999, how the markets
behaved and what they foresee for the near future. We trust you will find their
discussion informative. If you have any questions or comments, we invite you to
contact us, either at our Web site, aimfunds.com, or through our Client Services
department at 800-959-4246. Information about your account is also available
through our automated AIM Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of Funds
- --Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman, A I M Advisors, Inc.
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STAYING FULLY
INVESTED IN A DIVERSIFIED PORTFOLIO REMAINS
A COMPELLING STRATEGY AND ONE OF YOUR
BEST PROSPECTS FOR
LONG-TERM GAIN.
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AIM WEINGARTEN FUND
<PAGE> 4
ANNUAL REPORT / MANAGERS' OVERVIEW
FUND BEATS INDEX, BOOSTED BY
TECHNOLOGY HOLDINGS
HOW DID THE FUND PERFORM?
Benefiting from the technology sector's continued strength, AIM Weingarten Fund
posted impressive gains for the fiscal year ended October 31, 1999. Total return
for the fund's Class A shares was 38.67%. Performance by the fund's Class B and
C shares was equally robust. The fund's Class B shares returned 37.64% and Class
C shares gained 37.61%. These returns are computed at net asset value, that is,
without the effect of sales charges. Fund performance handily outpaced the
Russell 1000 Index, which returned 25.58% for the same period. Long-term
performance for AIM Weingarten Fund remains excellent, as shown on the following
pages.
The fund's net assets under management soared to $9.60 billion at the end of
the fiscal year.
WHAT WERE MARKET CONDITIONS LIKE DURING THE REPORTING PERIOD?
Investor concern over interest rates caused the financial markets to be very
volatile in 1999. In June and August, the Federal Reserve Board (the Fed) raised
interest rates in two quarter-point moves. Investors were unsure what Fed
policymakers would do at their October meeting, and the uncertainty roiled the
markets. The Fed chose to leave rates unchanged but adopted a "tightening bias,"
indicating that it may be inclined to raise rates in the near future.
During the summer, the equity market experienced a temporary broadening into
value, cyclical and smaller-cap stocks, but returned to its narrow, large-cap
growth focus in the fall. Most market trends of the last few years continued
during the third quarter. The largest stocks in the S&P 500 dominated that
index's return while the remainders produced lackluster results. In fact,
despite advances by the main market indexes, most stocks under-performed during
this time.
In one of the biggest shake-ups of its 103-year history, the Dow Jones
Industrial Average revised its membership in October to include Microsoft,
Intel, SBC Communications and Home Depot. The move signaled the markets'
transition to the "new economy," dominated by technology, telecommunications and
warehouse retailers. As of October 31, 1999 the fund had holdings in Microsoft,
Intel and Home Depot.
WHAT CONTRIBUTED TO THE FUND'S STRONG GAINS?
The fund's sterling performance can be credited to our exposure to the
technology sector, the only S&P 500 industry group to post a positive return
during the third quarter, when most sectors of the equity market retreated. The
proliferation of the Internet drove demand throughout the sector and especially
in companies that are building the Internet's infra-structure. Fund holdings
Cisco Systems, a networking company, and Sun Microsystems, which makes servers,
are integral parts of the structure of the Internet. These companies are seeing
great acceleration in their revenues and earnings, and their success greatly
contributed to the fund's excellent returns during the fiscal year. As of
October 31, technology holdings accounted for approximately 50% of the fund's
total net assets. Our continued emphasis on market leaders in this sector shows
in the large number of technology companies in our top 10 holdings.
THE FUND'S LARGEST HOLDING IS MICROSOFT. HOW WILL THE RULING IN THE DEPARTMENT
OF JUSTICE CASE AFFECT YOUR INVESTMENT?
After the close of the reporting period, a federal judge ruled that Microsoft is
a
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INVESTOR CONCERN OVER INTEREST
RATES CAUSED THE FINANCIAL MARKETS
TO BE VERY VOLATILE IN 1999.
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GROWTH OF NET ASSETS
As of 10/31/99
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10/31/98 $6.90 Billion
10/31/99 $9.60 Billion
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AIM WEINGARTEN FUND
VS. BENCHMARK INDEX
One-year returns, excluding sales charges
As of 10/31/99
================================================================================
Class A Shares 38.67%
Class B Shares 37.64%
Class C Shares 37.61%
Russell 1000 Index 25.58%
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See important fund and index disclosures inside front cover.
AIM WEINGARTEN FUND
2
<PAGE> 5
ANNUAL REPORT / MANAGERS' OVERVIEW
monopoly. As of this writing, neither a settlement nor an appeal has been
announced, and it is unlikely that a final decision will be made until 2001. We
believe that the company's growth prospects remain strong, especially with the
upcoming introduction of two new software products: Office 2000 and Windows
2000. In the short term, the stock may be volatile, but this is a core growth
company that should continue to be a part of our portfolio.
DID YOU MAKE ANY CHANGES TO THE FUND'S PORTFOLIO?
As earnings growth narrowed in 1999, we decided to cull the fund's holdings. The
number of holdings decreased to 83 from more than 120 a year ago. In keeping
with AIM's earnings-momentum investment strategy, we also sold stocks with
negative earnings revisions. These sales generated realized capital gains in
some cases but allowed us to concentrate on the highest growth stocks. We
believe that the overall effect of focusing on the best-performing stocks has
been positive and should improve fund performance over the long term.
WHAT IS YOUR OUTLOOK FOR THE FUTURE?
Shortly after the end of the fiscal year, Fed policymakers increased short-term
interest rates by a quarter of a percentage point, but shifted to a neutral
bias, indicating that they may or may not raise rates again for the rest of the
year. We believe that this move may improve investor confidence in the near
future since it means that the Fed is serious about heading off inflationary
pressures.
The long-term outlook for the market remains positive. The United States is
experiencing one of the longest expansion periods in its history. The U.S.
economy remains strong, inflation is low and the country is enjoying a budget
surplus. Given these reasons, we remain excited about AIM Weingarten Fund. We
continue to find quality companies in the traditional growth sectors of
technology, health care and consumer cyclicals. And although market sectors will
always go in and out of favor, we believe that high-growth companies in the
large- and mid-cap sectors will continue to fare well in the current strong
business environment here and abroad.
AFTER THE CLOSE OF THE REPORTING PERIOD, FUND HOLDING TYCO INTERNATIONAL FELL
VICTIM TO CONCERNS ABOUT ITS ACCOUNTING METHODS. WHAT HAS BEEN YOUR RESPONSE?
In recent months, concerns have arisen over Tyco's accounting methods. While no
wrongdoing has been proven, Tyco and its stock price remain under scrutiny. Most
recently, the Securities and Exchange Commission launched an informal
investigation of the company, which Tyco voluntarily made public. While we have
no reason to believe that accounting irregularities exist, we do recognize that
this issue may take time to be resolved. As a result, we elected to reduce our
exposure by selling some of our position in the stock after the close of the
reporting period. While the outcome of this situation is difficult to predict,
we remain confident in the company and its management team. They have proven to
be significant creators of value for shareholders over the years, and we expect
they will continue this record of success despite current issues.
PORTFOLIO COMPOSITION
As of 10/31/99, based on total net assets
<TABLE>
<CAPTION>
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TOP 10 HOLDINGS TOP 10 INDUSTRIES
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<S> <C> <C> <C>
1. Microsoft Corp. 4.58% 1. Computers (Software & Services) 13.02%
2. Johnson & Johnson 3.04 2. Communications Equipment 9.33
3. Warner-Lambert Co. 2.91 3. Health Care (Diversified) 7.95
4. Comcast Corp.-Class A 2.88 4. Broadcasting (Television, Radio & Cable) 7.88
5. America Online, Inc. 2.70 5. Computers (Hardware) 6.54
6. Home Depot, Inc. (The) 2.58 6. Electronics (Semiconductors) 5.88
7. Tyco International Ltd. 2.50 7. Financial (Diversified) 4.96
8. Gateway, Inc. 2.48 8. Electrical Equipment 4.42
9. Outdoor Systems, Inc. 2.43 9. Retail (Building Supplies) 4.10
10. Cisco Systems, Inc. 2.22 10. Retail (General Merchandise) 3.01
The fund's portfolio is subject to change, and there is no assurance that the
fund will continue to hold any particular security.
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</TABLE>
See important fund and index disclosures inside front cover.
AIM WEINGARTEN FUND
3
<PAGE> 6
ANNUAL REPORT / PERFORMANCE HISTORY
YOUR FUND'S LONG-TERM PERFORMANCE
RESULTS OF A $10,000 INVESTMENT
AIM WEINGARTEN FUND VS. BENCHMARK INDEXES
10/31/79-10/31/99
in thousands
================================================================================
Class A Russell S&P
Shares 1000 500
10/79 9,450 10,000 10,000
10/81 17,700 13,286 13,351
10/83 28,408 19,769 19,616
10/85 32,745 25,093 24,730
10/87 49,177 35,561 33,854
10/89 74,959 51,563 49,315
10/91 104,224 63,649 60,987
10/93 118,234 80,416 78,190
10/95 157,275 105,578 102,379
10/97 229,014 173,053 165,914
10/99 356,217 265,278 249,391
Past performance cannot guarantee comparable future results.
Source: Lipper, Inc.
================================================================================
ABOUT THIS CHART
The chart compares your fund's Class A shares to benchmark indexes. Use of these
indexes is intended to give you a general idea of your fund's relative
performance from 10/31/79 to 10/31/99. It is important to understand differences
between your fund and these indexes. An index measures performance of a
hypothetical portfolio. A market index such as the Russell 1000 or the S&P 500
is not managed, incurring no sale charges, expenses or fees. If you could buy
all the securities that make up a market index, you would incur expenses that
would affect your investment's return.
Since the last reporting period, AIM Weingarten Fund has elected to use the
Russell 1000 as its benchmark instead of the S&P 500. The new index more closely
resembles the securities in which the fund invests. The fund will no longer
measure its performance against the S&P 500, the index published in previous
reports to shareholders. Because this is the first reporting period since we
have adopted the new index, SEC guidelines require that we compare the fund's
performance to both the old and the new index.
AVERAGE ANNUAL TOTAL RETURNS
As of 10/31/99, including sales charges
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CLASS A SHARES
10 years 16.22%
5 years 22.40
1 year 31.07
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CLASS B SHARES
Inception (6/26/95) 22.10%
1 year 32.64
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CLASS C SHARES
Inception (8/4/97) 19.90%
1 year 36.61
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Fund performance shown in the chart includes sales charges, expenses and
management fees. Class A share performance reflects deduction of the maximum
sales charge. The performance of the fund's Class B and Class C shares will
differ from that of Class A shares due to differences in sales charge structure
and expenses. For fund performance calculations and descriptions of the indexes
cited on this page, please see the inside front cover.
MARKET VOLATILITY CAN SIGNIFICANTLY IMPACT SHORT-TERM PERFORMANCE. RESULTS OF AN
INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM THE HISTORICAL PERFORMANCE
SHOWN.
AIM WEINGARTEN FUND
4
<PAGE> 7
AIM WEINGARTEN FUND
30TH
ANNIVERSARY
IN JUNE, AIM WEINGARTEN FUND CELEBRATED ITS 30TH ANNIVERSARY. FOR MORE THAN A
QUARTER OF A CENTURY, THE FUND HAS MANAGED SHAREHOLDERS' MONEY WITH THE SAME
DISCIPLINED INVESTMENT STRATEGY. IN THE NEXT FEW PAGES, WE'LL LOOK BACK ON THE
FUND'S 30-YEAR HISTORY AND INTRODUCE YOU TO THE TRAINOR FAMILY, WHO ARE USING
AIM WEINGARTEN FUND TO PURSUE THEIR GOALS OF A COMFORTABLE RETIREMENT AND OF
PROVIDING FOR THEIR CHILDREN'S COLLEGE FUNDS.
<PAGE> 8
A LOOK BACK ON 30 YEARS OF
AIM WEINGARTEN FUND
[PHOTO]
AIM Weingarten Fund has had just two senior portfolio mangers over its long
history: Jon Schoolar (left) and Harry Hutzler.
Over its 30-year history, AIM Weingarten Fund has weathered recessions, wars,
political upheaval and stock market crashes. The fund has met each challenge
with the same resilience that has been its trademark for more than a quarter of
a century.
The fund began its journey on June 17, 1969 as Weingarten Equity Fund, with
about $2.5 million in assets and 1,000 shareholders. Harry Hutzler, a partner
and economist at Weingarten & Company in New York, came up with the idea of
managing a mutual fund based on a relative earnings growth model.
"The objective right from the start was to build a portfolio of companies
whose earnings were growing far more rapidly than the economy as a whole," he
said. "So I was always very much growth-oriented. I preferred stocks with
superior relative strength."
A student of statistical probability, Hutzler developed an earnings-momentum
philosophy, which dictated that a manager would buy stocks at the first sign of
better-than-expected earnings and conversely sell quickly when earnings fell
below expectations. Hutzler realized early on that timely sell decisions were
critical to the overall success of a portfolio.
Shortly after Hutzler began managing the fund, Weingarten Equity Fund faced
its first hurdle. Recalling the 1973-1974 bear market, Hutzler said, "That was a
very frustrating period. I thought that it would never end."
But the fund weathered that market downturn as it would many others by
adhering to its disciplined investment style. By 1974, the fund's performance
started to pick up, and it quickly became one of the top performers in the
country.
When AIM bought the fund in 1986, Weingarten Equity Fund had one of the
mutual fund industry's best 10-year performance records with an average annual
total return of 24.6%. Net assets had grown to about $225 million. Hutzler
remained with AIM as the fund's senior portfolio manager and mentored AIM's
younger managers until he retired in 1993.
A little more than a year after the fund took on its new name, AIM
Weingarten Fund met with another major challenge--Black Monday 1987.
"It was a day like no other," said Jon Schoolar, who had joined the
management team in 1987. "It was an unbelievable day to be in the market."
Schoolar had been in New York studying under Hutzler's tutelage when the Dow
Jones Industrial Average plunged 508.32 points, losing 22.6% of its total value.
That fall far surpassed the one-day loss of 12.9% that triggered the great stock
market crash of 1929 and foreshadowed the Great Depression. It was decided then
that Schoolar could better serve the fund from the trading operations in
Houston. So he took the red-eye flight back to Texas and worked through the
night on the fund's trading strategies for the next day.
"All that night I worked on what we were going to have to sell because we
thought that it would be a disaster and that shareholders would panic and redeem
half the fund's assets," he said. "I got to the office very early the next
morning ready to do battle. And a funny thing happened."
Only 3% of the fund's total net assets had been redeemed. To Schoolar this
illustrated two important points. One is public shareholders are a lot more
sophisticated than most business magazine commentators give them credit for. The
fund's shareholders had understood that the best thing to do was to sit tight.
And the second thing is it speaks volumes for the advantage of having a good
financial advisor.
"In a bull market, people can trade their own accounts and may get rich
online," he said. "But in a bear market, those same people would redeem at the
AIM WEINGARTEN FUND
6
<PAGE> 9
THREE DECADES OF AIM WEINGARTEN FUND
In the past 30 years Hutzler's earnings-growth model has moved AIM Weingarten
Fund in three great shifts, each lasting roughly a decade. By owning the best
growth companies, the fund's portfolio has reflected the changing landscape of
the U.S. economy. In the 1970s, with the oil crisis raging, the fund had a heavy
slant toward natural resources and basic materials stocks. When Ronald Reagan
became president in the 1980s and cut taxes, consumer stocks and retailers
reigned. In the 1990s, technology and health care companies have been at the
cutting edge of earnings growth.
<TABLE>
<CAPTION>
====================================================================================================================================
TOP 10 HOLDINGS TOP 10 HOLDINGS TOP 10 HOLDINGS
as of 12/31/75 as of 12/31/85 as of 10/31/95*
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1. Houston Natural Gas 1. International Business Machines Corp. 1. Applied Materials, Inc.
2. The Pittston Company 2. Wal-Mart Stores Inc. 2. Philip Morris Companies, Inc.
3. Dillon Companies 3. Walt Disney Productions 3. Micron Technology Inc.
4. Bristol-Myers Co. 4. Philip Morris, Inc. 4. Texas Instruments Inc.
5. Lucky Stores, Inc. 5. Subaru of America, Inc. 5. Cisco Systems, Inc.
6. Philip Morris, Inc. 6. Marriott Corp. 6. Computer Associates International, Inc.
7. Pittway Corp. 7. Zayre Corp. 7. LAM Research Corp.
8. Rite Aid Corp. 8. Prime Motor Inns, Inc. 8. Schering-Plough Corp.
9. Masco Corp. 9. V.F. Corp. 9. Teradyne Inc.
10. Halliburton Co. 10. Automatic Data Processing Inc. 10. Varian Associates, Inc.
Total Net Assets Total Net Assets Total Net Assets
$7,968,582 $168,491,716 $4,661,298,749
* The fund changed its fiscal year-end from December 31 to October 31 in 1988.
====================================================================================================================================
</TABLE>
slightest market shift. If you have a financial advisor to explain that this may
be part of the game plan, then you'll have a better chance of withstanding the
market declines."
"A lot of things have changed since I got into this business," said
Schoolar, who became the fund's senior portfolio manager in 1993. "The world
moves so much faster now. Information travels at light speed. But as much as
everything has changed, the way you win the game is the same."
AIM Weingarten Fund continues to look for and own top-quality companies with
superior products and strong business models. It has remained fully invested
and maintained its focus on individual stocks rather than on the broader market.
The fund's management team still spends the bulk of its time thinking about what
to sell and what to buy to ensure that each stock meets with the fund's overall
growth objective.
When speaking about the fund's future, Schoolar remains confident. He uses
the following analogy to illustrate the advantage of owning the best U.S.
companies through AIM Weingarten Fund.
"As you're driving to work in the morning, look on the highway beside you,"
he said. "If you own AIM Weingarten Fund, all those people are going to work for
you. You have bought shares in hundreds of good-quality companies where people
just like you are getting up, heading off to the office and trying to make just
as much money and as much profit as they possibly can."
Over the past 30 years, those millions of people who go to work every day
have made the world a better place--and consequently have made a profit for the
shareholders of AIM Weingarten Fund.
"Looking back, there were so many reasons not to invest in 1969," he added.
"But if you had, 30 years later $10,000 would be worth close to $1 million. And
for 35-year-old working people in 1969, we may have helped them to realize their
financial goals."
AIM WEINGARTEN FUND
7
<PAGE> 10
BUILDING A FUTURE WITH AIM WEINGARTEN FUND
[PHOTO]
The Trainor family: Mitch, Bernetta, Sarah, Alex and Hellen.
Mitch and Bernetta Trainor appreciate the fact that professional money managers
handle their financial investments. It leaves the couple more time to focus on
the things that are important to them, like raising their three children and
deciding how to celebrate their 19th wedding anniversary.
Mitch, 44, and Bernetta met at Morehead State University in Kentucky. He was
an education major, and she was studying social work. After college the couple
moved to Bernetta's hometown of Louisville to start a family.
"We wanted to finish school and have everything in place before we started a
family," said Bernetta, 40. "But it didn't happen that way."
Their first son, Derek, was born premature and lived only one day. Bernetta
was diagnosed as high-risk and could not have other children. The couple decided
to pursue adoption after Bernetta saw a family on television talking about their
experiences with international children.
"We just wanted to be a mom and dad, and we didn't care if we didn't all
look alike," said Mitch.
The Trainors applied to Holt International, an agency that specializes in
international adoptions, in September 1985. Eight months later, their
four-month-old daughter, Sarah, arrived from Korea.
"The day she arrived was unbelievable," said Mitch. "If you know the feeling
of having your own child, this wasn't any different."
After the success of their first adoption, the Trainors applied again, and
this time four-month-old Alex came from Korea.
The Trainors have always had a deep commitment to helping others. Bernetta
is an adoption worker. And Mitch, an orthotist, designs orthopedic devices for
people who have become disabled or who were born with physical disabilities. He
also uses his medical knowledge to help children in impoverished countries.
Since 1986, Mitch has worked with a non-profit organization, called Children of
the Americas, to provide medical supplies and treatment to indigent children in
Latin America.
It was on one of his trips delivering medical supplies to Guatemala that
Mitch met their youngest daughter, Hellen.
"I just fell in love with her," he said. The Trainors adopted Hellen soon
afterward.
As his family became complete, Mitch started to think seriously about his
long-term financial plans. When he decided to rollover his 401(k) plan into a
SEP-IRA, Mitch turned to Rita Cron, a financial advisor with First Union
Securities.
"When I had my 401(k), I wasn't really involved with the
-------------------------------------
AS HIS FAMILY BECAME COMPLETE,
MITCH STARTED TO THINK SERIOUSLY
ABOUT HIS LONG-TERM FINANCIAL PLANS.
-------------------------------------
AIM WEINGARTEN FUND
8
<PAGE> 11
[PHOTO]
-------------------------------------
Mitch Trainor and his financial
advisor, Rita Cron.
-------------------------------------
planning," said Mitch. "With Rita, it's been completely different."
Rita helped Mitch understand the time horizon associated with his retirement
goals. Since he has known some of his patients for almost 20 years and sometimes
works with children just a few days old, Mitch was comfortable with the idea of
long-term commitment and patience.
"I know I'm in it for the long haul," he said. "I want a good nest egg for
retirement, and so far it's looking good."
Rita recommended AIM Weingarten Fund to Mitch because she was impressed with
the fund's consistent record.
"Weingarten has steadily beaten the S&P 500 throughout its long history,"
she said. "It was a good fit for Mitch."
Like many parents, the Trainors want to help their children fulfill their
dreams. At 14, Sarah already knows that she wants to be a criminal lawyer. Alex,
11, has his sights on engineering or becoming a juggler with the Renaissance
fair. And little Hellen, 7, thinks about becoming a gymnastics teacher. With
three kids moving in three different directions, Mitch has also started to think
about college funds.
"When Rita told me that Weingarten was up over 40%, I just couldn't believe
it," he said about one of their recent conversations on the fund's one-year
performance as of August 31, 1999. The fund's strong growth potential may be a
good fit for his children's future as well.
When the Trainors are not working or dropping off and picking up their
children from lessons and practices, they like to relax at the beach. The family
has spent the last few summers at Myrtle Beach and in Florida.
Like many couples with children, it's sometimes a challenge for Mitch and
Bernetta to find time for themselves. The couple will celebrate their 19th
wedding anniversary in 2000, and Mitch plans to take his wife to the Bahamas.
"It's been 14 years since we've spent more than one night alone together,"
said Mitch.
"We're very excited," Bernetta added.
Although the Trainors look forward to retirement, they also realize the
importance of balancing long-term goals with their needs today. "You just can't
put off everything you want to do until retirement," Bernetta said.
Her husband agrees. "I don't know where we'll be in 20 years, but I hope
we'll be doing as well as we are now."
[PHOTO]
-------------------------------------
Mitch Trainor carefully adjusts
an orthopedic brace on one
of his little patients.
-------------------------------------
-------------------------------------
FINANCIAL ADVISOR RITA CRON
RECOMMENDED AIM WEINGARTEN FUND TO
MITCH BECAUSE SHE WAS IMPRESSED
WITH THE FUND'S CONSISTENT RECORD.
-------------------------------------
This is not a paid testimonial. It may not represent the experience of other AIM
Weingarten Fund shareholders and may not indicate future performance.
9
<PAGE> 12
THE AIM WEINGARTEN FUND GROWTH STORY...
GROWTH OF $10,000 INVESTMENT: JUNE 17, 1969--OCTOBER 31, 1999
<TABLE>
=====================================================================================================
<S> <C> <C> <C> <C>
12/31/69 10494 10062 9416
12/31/70 8293 8947 8231 Cambodia Invaded, Vietnam War Spreads
12/31/71 10426 10455 11485 90-Day Freeze on Wages and Prices
12/31/72 12908 12748 14252 New York City Near Bankruptcy
12/31/73 11877 12749 12908 Arab Oil Embargo--Prices Quadruple from
Approximately $3 to $12 Per Barrel
12/31/74 7597 9079 8112 Steepest Market Decline in 40 Years; S&P 500
Down 26%
12/31/75 9311 11438 10273 United States Suffers Economic Recession
12/31/76 10681 13743 10505 Trade Deficit Reaches Record $5 Billion
12/31/77 10325 12913 12925 S&P Declines 7%
12/31/78 11598 13733 15586 OPEC Raises Prices 14%
12/31/79 14305 15855 21777 Annual Inflation Rate Hits 13%
12/31/80 20539 20945 40440 Prime Interest Rate Reaches 20%
12/31/81 20709 21065 40783 Assassination Attempt on President Reagan
12/31/82 23894 24496 46289 Unemployment Reaches 10.8%
=====================================================================================================
</TABLE>
<TABLE>
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income Dividends Reinvested 0 38 58 0 0 0 0 54 0 98 208 166 237 247
Capital Gains Reinvested 0 57 0 0 1,344 0 0 0 0 0 0 3,482 5,379 5,058
Total Distributions Reinvested 0 96 58 0 1,344 0 0 54 0 98 208 3,648 5,617 5,305
Total Account Value 9,425 8,251 11,495 14,262 12,919 8,123 10,283 10,505 12,936 15,608 21,799 40,440 40,812 46,323
====================================================================================================================================
</TABLE>
MARKET VOLATILITY CAN SIGNIFICANTLY IMPACT SHORT-TERM PERFORMANCE. RESULTS OF AN
INVESTMENT MADE TODAY MAY DIFFER SUBSTANTIALLY FROM THE HISTORICAL PERFORMANCE
SHOWN.
AIM WEINGARTEN FUND
10
<PAGE> 13
...CONSISTENT APPRECIATION OVER THE LONG TERM
[PHOTO]
[PHOTO]
[CHART]
<TABLE>
=====================================================================================================
<S> <C> <C> <C> <C>
12/31/83 30474 31341 65460 Terrorist Bomb Kills 241 U.S. Marines in Beirut
12/31/84 29782 33337 63077 Federal Deficit Tops Record $185 Billion
12/31/85 35260 39782 75451 U.S. Dollar Reaches Lowest Level in Five Years
12/31/86 45589 52984 107196 Tax Reform Act Cuts IRA Deduction
12/31/87 45974 56374 113321 Stock Market Crashes--Dow Down 25% in Five Weeks
12/31/88 52983 64693 127826 Savings and Loan Insolvencies Mount
12/31/89 66365 81744 172731 Junk Bond Market Collapses
12/31/90 57851 75629 165769 Iraq Invades Kuwait
12/31/91 81830 100902 240174 Recession Persists
12/31/92 88217 110940 256626 Unemployment Reaches 10-Year High
12/31/93 104963 127480 272462 Economic Growth Remains Sluggish
12/31/94 107108 132397 282717 Fed Raises Federal Funds Interest Rate Six Times
12/31/95 132790 167362 362445 Mexican Peso Devalued
12/31/96 155352 207664 416121 Weakened Markets in Europe and Japan Limit
U.S. Exports
12/31/97 199431 274322 527771 Asian Market Tumbles
12/31/98 227109 334707 592904 Stock Market Sees Record Volatility
12/31/99 293703 420601 822199
=====================================================================================================
</TABLE>
<TABLE>
<S> <C>
AIM Weingarten Fund Class A Shares $822,199
S&P 500 $420,602
Lipper Growth Funds Index $293,703
</TABLE>
Past performance cannot guarantee comparable future results.
<TABLE>
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
0 136 461 788 957 126 1,558 897 1,338 1,029 1,346 1,701 1,079 0 1,237 0 388
0 14,531 0 4,777 24,440 9,739 0 8,917 3,122 1,333 0 5,080 28,208 48,243 46,064 79,186 39,789
0 14,668 461 5,565 25,397 9,865 1,558 9,814 4,460 2,362 1,346 6,781 29,287 48,243 47,301 79,186 40,177
65,494 63,123 75,498 107,245 113,321 127,826 172,731 165,769 240,174 256,627 272,462 282,717 362,446 416,122 527,771 592,904 822,199
====================================================================================================================================
</TABLE>
Source: Lipper, Inc. and Copyright(C) 1993-1999 Wiesenberger--Registered
Trademark--, a Thomson financial company. Fund performance shown in the chart
includes expenses and management fees. Class A share performance reflects
deduction of the maximum sales charge. For fund data performance calculations
and descriptions of indexes cited on this page, please refer to the inside front
cover.
AIM WEINGARTEN FUND
11
<PAGE> 14
SCHEDULE OF INVESTMENTS
October 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
DOMESTIC COMMON STOCKS & OTHER
EQUITY INTERESTS-94.51%
BIOTECHNOLOGY-0.32%
Amgen, Inc.(a) 386,300 $ 30,807,425
- ---------------------------------------------------------------
BROADCASTING (TELEVISION, RADIO &
CABLE)-7.88%
AT&T Corp. - Liberty Media
Group-Class A(a) 3,300,000 130,968,750
- ---------------------------------------------------------------
Cablevision Systems Corp.-Class
A(a) 579,700 39,165,981
- ---------------------------------------------------------------
Clear Channel Communications,
Inc.(a) 2,000,000 160,750,000
- ---------------------------------------------------------------
Comcast Corp.-Class A 6,554,600 276,112,525
- ---------------------------------------------------------------
Cox Communications, Inc.-Class
A(a) 2,330,900 105,910,269
- ---------------------------------------------------------------
Infinity Broadcasting Corp.-Class
A(a) 1,274,500 44,049,906
- ---------------------------------------------------------------
756,957,431
- ---------------------------------------------------------------
COMMUNICATIONS EQUIPMENT-9.33%
General Instrument Corp.(a) 2,822,200 151,869,637
- ---------------------------------------------------------------
JDS Uniphase Corp.(a) 250,000 41,718,750
- ---------------------------------------------------------------
Lucent Technologies Inc. 2,500,000 160,625,000
- ---------------------------------------------------------------
Motorola, Inc. 1,100,000 107,181,250
- ---------------------------------------------------------------
Nokia Oyj-ADR (Finland) 1,000,000 115,562,500
- ---------------------------------------------------------------
Nortel Networks Corp. (Canada) 3,250,000 201,296,875
- ---------------------------------------------------------------
QUALCOMM, Inc.(a) 247,700 55,175,175
- ---------------------------------------------------------------
Tellabs, Inc.(a) 988,000 62,491,000
- ---------------------------------------------------------------
895,920,187
- ---------------------------------------------------------------
COMPUTERS (HARDWARE)-6.54%
Apple Computer, Inc.(a) 1,000,000 80,125,000
- ---------------------------------------------------------------
Gateway, Inc.(a) 3,600,000 237,825,000
- ---------------------------------------------------------------
International Business Machines
Corp. 1,000,000 98,375,000
- ---------------------------------------------------------------
Sun Microsystems, Inc.(a)(b) 2,000,000 211,625,000
- ---------------------------------------------------------------
627,950,000
- ---------------------------------------------------------------
COMPUTERS (NETWORKING)-2.22%
Cisco Systems, Inc.(a)(b) 2,879,800 213,105,200
- ---------------------------------------------------------------
COMPUTERS (PERIPHERALS)-1.66%
EMC Corp.(a)(b) 900,000 65,700,000
- ---------------------------------------------------------------
Lexmark International Group,
Inc.-Class A(a) 1,204,400 94,018,475
- ---------------------------------------------------------------
159,718,475
- ---------------------------------------------------------------
COMPUTERS (SOFTWARE & SERVICES)-13.02%
America Online, Inc.(a)(b) 2,000,000 259,375,000
- ---------------------------------------------------------------
BMC Software, Inc.(a) 634,800 40,746,225
- ---------------------------------------------------------------
Citrix Systems, Inc.(a) 1,581,700 101,426,512
- ---------------------------------------------------------------
Compuware Corp.(a)(b) 421,400 11,720,187
- ---------------------------------------------------------------
Intuit, Inc.(a) 1,198,200 34,897,575
- ---------------------------------------------------------------
Microsoft Corp.(a) 4,750,000 439,671,875
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMPUTERS (SOFTWARE & SERVICES)-(CONTINUED)
Oracle Corp.(a) 248,600 $ 11,824,037
- ---------------------------------------------------------------
Rational Software Corp.(a) 528,600 22,597,650
- ---------------------------------------------------------------
Unisys Corp.(a) 2,977,600 72,206,800
- ---------------------------------------------------------------
VERITAS Software Corp.(a)(b) 1,250,000 134,843,750
- ---------------------------------------------------------------
Yahoo! Inc.(a)(b) 675,000 120,867,188
- ---------------------------------------------------------------
1,250,176,799
- ---------------------------------------------------------------
ELECTRICAL EQUIPMENT-4.42%
General Electric Co. 1,000,000 135,562,500
- ---------------------------------------------------------------
Koninklijke (Royal) Philips
Electronics N.V.-ADR
(Netherlands) 506,000 52,592,375
- ---------------------------------------------------------------
Koninklijke (Royal) Philips
Electronics N.V. (Netherlands) 948,520 97,294,320
- ---------------------------------------------------------------
Sanmina Corp.(a)(b) 1,023,000 92,133,938
- ---------------------------------------------------------------
Symbol Technologies, Inc. 1,188,000 47,223,000
- ---------------------------------------------------------------
424,806,133
- ---------------------------------------------------------------
ELECTRONICS (INSTRUMENTATION)-0.44%
Waters Corp.(a) 800,000 42,500,000
- ---------------------------------------------------------------
ELECTRONICS (SEMICONDUCTORS)-5.88%
Analog Devices, Inc.(a) 1,300,000 69,062,500
- ---------------------------------------------------------------
Cypress Semiconductor Corp.(a) 2,500,000 63,906,250
- ---------------------------------------------------------------
Intel Corp.(b) 720,000 55,755,000
- ---------------------------------------------------------------
LSI Logic Corp.(a) 1,250,000 66,484,375
- ---------------------------------------------------------------
Texas Instruments, Inc. 1,700,000 152,575,000
- ---------------------------------------------------------------
Xilinx, Inc.(a) 2,000,000 157,250,000
- ---------------------------------------------------------------
565,033,125
- ---------------------------------------------------------------
ENTERTAINMENT-1.38%
Time Warner, Inc. 1,900,000 132,406,250
- ---------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-4.96%
American Express Co. 700,000 107,800,000
- ---------------------------------------------------------------
Fannie Mae 2,263,900 160,170,925
- ---------------------------------------------------------------
Freddie Mac 3,859,600 208,659,625
- ---------------------------------------------------------------
476,630,550
- ---------------------------------------------------------------
HEALTH CARE (DIVERSIFIED)-7.95%
Bristol-Myers Squibb Co. 2,500,000 192,031,250
- ---------------------------------------------------------------
Johnson & Johnson 2,785,947 291,827,948
- ---------------------------------------------------------------
Warner-Lambert Co. 3,500,000 279,343,750
- ---------------------------------------------------------------
763,202,948
- ---------------------------------------------------------------
HEALTH CARE (DRUGS-MAJOR
PHARMACEUTICALS)-2.73%
Pfizer, Inc. 1,076,200 42,509,900
- ---------------------------------------------------------------
</TABLE>
12
<PAGE> 15
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
HEALTH CARE (DRUGS-MAJOR
PHARMACEUTICALS)-(CONTINUED)
Pharmacia & Upjohn, Inc. 1,500,000 $ 80,906,250
- ---------------------------------------------------------------
Schering-Plough Corp. 2,795,700 138,387,150
- ---------------------------------------------------------------
261,803,300
- ---------------------------------------------------------------
HEALTH CARE (MEDICAL PRODUCTS &
SUPPLIES)-2.44%
Bausch & Lomb, Inc. 412,200 22,258,800
- ---------------------------------------------------------------
Guidant Corp. 4,297,100 212,169,313
- ---------------------------------------------------------------
234,428,113
- ---------------------------------------------------------------
INSURANCE (MULTI-LINE)-2.18%
American International Group,
Inc. 2,030,500 209,014,594
- ---------------------------------------------------------------
LODGING-HOTELS-2.05%
Carnival Corp. 2,318,800 103,186,600
- ---------------------------------------------------------------
Royal Caribbean Cruises Ltd. 1,762,300 93,512,044
- ---------------------------------------------------------------
196,698,644
- ---------------------------------------------------------------
MANUFACTURING (DIVERSIFIED)-2.50%
Tyco International Ltd. 6,000,000 239,625,000
- ---------------------------------------------------------------
NATURAL GAS-0.48%
Enron Corp. 1,150,000 45,928,125
- ---------------------------------------------------------------
RETAIL (BUILDING SUPPLIES)-4.10%
Home Depot, Inc. (The) 3,275,000 247,262,500
- ---------------------------------------------------------------
Lowe's Companies, Inc. 2,660,000 146,300,000
- ---------------------------------------------------------------
393,562,500
- ---------------------------------------------------------------
RETAIL (COMPUTERS & ELECTRONICS)-2.51%
Best Buy Co., Inc.(a) 1,340,000 74,453,750
- ---------------------------------------------------------------
Circuit City Stores-Circuit City
Group 1,700,000 72,568,750
- ---------------------------------------------------------------
Tandy Corp. 1,500,000 94,406,250
- ---------------------------------------------------------------
241,428,750
- ---------------------------------------------------------------
RETAIL (DISCOUNTERS)-0.15%
Dollar Tree Stores, Inc.(a) 324,600 14,140,388
- ---------------------------------------------------------------
RETAIL (FOOD CHAINS)-0.42%
Kroger Co. (The)(a) 1,950,000 40,584,375
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
RETAIL (GENERAL MERCHANDISE)-3.01%
Costco Wholesale Corp.(a) 700,000 $ 56,218,750
- ---------------------------------------------------------------
Dayton Hudson Corp. 1,405,300 90,817,513
- ---------------------------------------------------------------
Wal-Mart Stores, Inc. 2,500,000 141,718,750
- ---------------------------------------------------------------
288,755,013
- ---------------------------------------------------------------
RETAIL (SPECIALTY)-0.38%
Tiffany & Co. 609,000 36,235,500
- ---------------------------------------------------------------
RETAIL (SPECIALTY-APPAREL)-0.65%
Gap, Inc. (The) 670,000 24,873,750
- ---------------------------------------------------------------
Intimate Brands, Inc.(c) 909,100 37,273,100
- ---------------------------------------------------------------
62,146,850
- ---------------------------------------------------------------
SERVICES (ADVERTISING/MARKETING)-2.43%
Outdoor Systems, Inc.(a) 5,500,000 233,062,500
- ---------------------------------------------------------------
SERVICES (DATA PROCESSING)-0.94%
Concord EFS, Inc.(a) 323,700 8,760,131
- ---------------------------------------------------------------
First Data Corp. 1,440,000 65,790,000
- ---------------------------------------------------------------
Fiserv, Inc.(a) 477,175 15,269,600
- ---------------------------------------------------------------
89,819,731
- ---------------------------------------------------------------
TELECOMMUNICATIONS (CELLULAR/
WIRELESS)-1.54%
Nextel Communications, Inc.-Class
A(a) 1,300,000 112,043,750
- ---------------------------------------------------------------
Western Wireless Corp.-Class A(a) 672,900 35,579,588
- ---------------------------------------------------------------
147,623,338
- ---------------------------------------------------------------
Total Domestic Common Stocks
& Other Equity Interests
(Cost $5,900,438,167) 9,074,071,244
- ---------------------------------------------------------------
MONEY MARKET FUNDS-6.05%
STIC Liquid Assets Portfolio(d) 290,412,117 290,412,117
- ---------------------------------------------------------------
STIC Prime Portfolio(d) 290,412,117 290,412,117
- ---------------------------------------------------------------
Total Money Market Funds
(Cost $580,824,234) 580,824,234
- ---------------------------------------------------------------
TOTAL INVESTMENTS-100.56% 9,654,895,478
- ---------------------------------------------------------------
LIABILITIES LESS OTHER
ASSETS-(0.56%) (54,205,007)
- ---------------------------------------------------------------
NET ASSETS-100.00% $9,600,690,471
===============================================================
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) A portion of this security is subject to call options written. See Note 7.
(c) Affiliated issuers are those in which the Fund's holdings of an issuer
represent 5% or more of the outstanding voting securities of the issuer. The
Fund has not owned enough of the outstanding voting securities of the issuer
to have control (as defined in the Investment Company Act of 1940) of that
issuer. The market value as of 10/31/99 represented 0.39% of the Fund's net
assets.
(d) The security shares the same investment advisor as the Fund.
See Notes to Financial Statements.
13
<PAGE> 16
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$6,481,262,401) $9,654,895,478
- --------------------------------------------------------
Receivables for:
Investments sold 292,802,227
- --------------------------------------------------------
Capital stock sold 9,059,459
- --------------------------------------------------------
Dividends and interest 3,724,856
- --------------------------------------------------------
Investment for deferred compensation
plan 132,089
- --------------------------------------------------------
Other assets 170,438
- --------------------------------------------------------
Total assets 9,960,784,547
- --------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 200,543,565
- --------------------------------------------------------
Capital stock reacquired 11,182,096
- --------------------------------------------------------
Deferred compensation 132,089
- --------------------------------------------------------
Options written (premiums received
$116,996,621) 137,381,137
- --------------------------------------------------------
Accrued advisory fees 4,560,939
- --------------------------------------------------------
Accrued administrative services fees 33,365
- --------------------------------------------------------
Accrued directors' fees 3,745
- --------------------------------------------------------
Accrued distribution fees 4,061,117
- --------------------------------------------------------
Accrued transfer agent fees 1,100,647
- --------------------------------------------------------
Accrued operating expenses 1,095,376
- --------------------------------------------------------
Total liabilities 360,094,076
- --------------------------------------------------------
Net assets applicable to shares
outstanding $9,600,690,471
========================================================
NET ASSETS:
Class A $8,089,739,193
========================================================
Class B $1,291,455,555
========================================================
Class C $ 105,419,980
========================================================
Institutional Class $ 114,075,743
========================================================
CAPITAL STOCK, $0.001 PAR VALUE PER SHARE:
Class A:
Authorized 750,000,000
- --------------------------------------------------------
Outstanding 285,748,483
========================================================
Class B:
Authorized 750,000,000
- --------------------------------------------------------
Outstanding 47,327,507
========================================================
Class C:
Authorized 750,000,000
- --------------------------------------------------------
Outstanding 3,860,919
========================================================
Institutional Class:
Authorized 200,000,000
- --------------------------------------------------------
Outstanding 3,938,787
========================================================
Class A:
Net asset value and redemption price
per share $ 28.31
- --------------------------------------------------------
Offering price per share:
(Net asset value of
$28.31 / 94.50%) $ 29.96
========================================================
Class B:
Net asset value and offering price per
share $ 27.29
========================================================
Class C:
Net asset value and offering price per
share $ 27.30
========================================================
Institutional Class:
Net asset value, offering and
redemption price per share $ 28.96
========================================================
</TABLE>
See Notes to Financial Statements.
STATEMENT OF OPERATIONS
For the year ended October 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $491,673 foreign
withholding tax) $ 35,922,859
- ----------------------------------------------------------
Interest 20,631,177
- ----------------------------------------------------------
Total investment income 56,554,036
- ----------------------------------------------------------
EXPENSES:
Advisory fees 54,999,214
- ----------------------------------------------------------
Administrative services fees 281,500
- ----------------------------------------------------------
Custodian fees 560,875
- ----------------------------------------------------------
Directors' fees 63,384
- ----------------------------------------------------------
Distribution fees-Class A 22,561,363
- ----------------------------------------------------------
Distribution fees-Class B 10,382,904
- ----------------------------------------------------------
Distribution fees-Class C 593,913
- ----------------------------------------------------------
Transfer agent fees-Class A 8,377,262
- ----------------------------------------------------------
Transfer agent fees-Class B 2,106,122
- ----------------------------------------------------------
Transfer agent fees-Class C 144,793
- ----------------------------------------------------------
Transfer agent fees-Institutional Class 11,831
- ----------------------------------------------------------
Other 2,155,285
- ----------------------------------------------------------
Total expenses 102,238,446
- ----------------------------------------------------------
Less: Fees waived by advisor (4,288,405)
- ----------------------------------------------------------
Expenses paid indirectly (164,622)
- ----------------------------------------------------------
Net expenses 97,785,419
- ----------------------------------------------------------
Net investment income (loss) (41,231,383)
- ----------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES, FOREIGN
CURRENCIES, FUTURES AND OPTION
CONTRACTS:
Net realized gain (loss) from:
Investment securities 1,362,280,575
- ----------------------------------------------------------
Foreign currencies (5,296,267)
- ----------------------------------------------------------
Futures contracts 10,089,965
- ----------------------------------------------------------
Option contracts purchased (4,655,890)
- ----------------------------------------------------------
Option contracts written (109,805,107)
- ----------------------------------------------------------
1,252,613,276
- ----------------------------------------------------------
Change in net unrealized appreciation
(depreciation) of:
Investment securities 1,465,393,764
- ----------------------------------------------------------
Foreign currencies 25,402
- ----------------------------------------------------------
Futures contracts (6,756,866)
- ----------------------------------------------------------
Option contracts purchased (3,182,585)
- ----------------------------------------------------------
Option contracts written (27,511,086)
- ----------------------------------------------------------
1,427,968,629
- ----------------------------------------------------------
Net gain from investment securities,
foreign currencies, futures and option
contracts 2,680,581,905
- ----------------------------------------------------------
Net increase in net assets resulting from
operations $2,639,350,522
==========================================================
</TABLE>
14
<PAGE> 17
STATEMENT OF CHANGES IN NET ASSETS
For the years ended October 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
-------------- --------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (41,231,383) $ 89,216
- ----------------------------------------------------------- ---------------- --------------
Net realized gain from investment securities, foreign
currencies, futures and option contracts 1,252,613,276 514,276,104
- ----------------------------------------------------------- ---------------- --------------
Change in net unrealized appreciation of investment
securities, foreign currencies, futures and option
contracts 1,427,968,629 255,708,695
- ----------------------------------------------------------- ---------------- --------------
Net increase in net assets resulting from operations 2,639,350,522 770,074,015
- ----------------------------------------------------------- ---------------- --------------
Distributions to shareholders from net investment income:
Class A (3,691,627) --
- ----------------------------------------------------------- ---------------- --------------
Institutional Class (343,112) --
- ----------------------------------------------------------- ---------------- --------------
Distribution in excess of net investment income:
Class A (377,640)
- ----------------------------------------------------------- ---------------- --------------
Institutional Class (5,008)
- ----------------------------------------------------------- ---------------- --------------
Distributions to shareholders from net realized gains:
Class A (404,965,108) (864,947,763)
- ----------------------------------------------------------- ---------------- --------------
Class B (49,731,739) (76,736,323)
- ----------------------------------------------------------- ---------------- --------------
Class C (1,700,816) (626,936)
- ----------------------------------------------------------- ---------------- --------------
Institutional Class (4,837,664) (9,231,714)
- ----------------------------------------------------------- ---------------- --------------
Share transactions-net:
Class A 95,538,920 442,079,076
- ----------------------------------------------------------- ---------------- --------------
Class B 347,953,526 240,674,117
- ----------------------------------------------------------- ---------------- --------------
Class C 70,937,422 21,194,188
- ----------------------------------------------------------- ---------------- --------------
Institutional Class 16,644,022 12,302,794
- ----------------------------------------------------------- ---------------- --------------
Net increase in net assets 2,704,771,698 534,781,454
- ----------------------------------------------------------- ---------------- --------------
NET ASSETS:
Beginning of period 6,895,918,773 6,361,137,319
- ----------------------------------------------------------- ---------------- --------------
End of period $9,600,690,471 $6,895,918,773
=========================================================== ================ ==============
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $5,279,351,381 $4,682,377,491
- ----------------------------------------------------------- ---------------- --------------
Undistributed net investment income (loss) (317,554) 4,034,739
- ----------------------------------------------------------- ---------------- --------------
Undistributed net realized gain from investment
securities, foreign currencies, futures and option
contracts 1,168,419,727 484,238,255
- ----------------------------------------------------------- ---------------- --------------
Unrealized appreciation of investment securities, foreign
currencies, futures and option contracts 3,153,236,917 1,725,268,288
- ----------------------------------------------------------- ---------------- --------------
$9,600,690,471 $6,895,918,773
=========================================================== ================ ==============
</TABLE>
See Notes to Financial Statements.
15
<PAGE> 18
NOTES TO FINANCIAL STATEMENTS
October 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Weingarten Fund (the "Fund") is a series portfolio of AIM Equity Funds, Inc.
(the "Company"). The Company is a Maryland corporation registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end
series management investment company consisting of ten separate portfolios. The
Fund currently offers four different classes of shares: Class A shares, Class B
shares, Class C shares and the Institutional Class. Class A shares are sold with
a front-end sales charge. Class B shares and Class C shares are sold with a
contingent deferred sales charge. Matters affecting each portfolio or class will
be voted on exclusively by the shareholders of such portfolio or class. The
assets, liabilities and operations of each portfolio are accounted for
separately. Information presented in these financial statements pertains only to
the Fund. The Fund's investment objective is growth of capital primarily by
investing in common stocks of seasoned and better-capitalized companies.
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 -- A security listed or traded on an exchange (except
convertible bonds) is valued at its last sales price on the exchange where
the security is principally traded, or lacking any sales on a particular
day, the security is valued at the closing bid price on that day. Each
security reported on the NASDAQ National Market System is valued at the last
sales price on the valuation date or absent a last sales price, at the
closing bid price. Debt obligations (including convertible bonds) are valued
on the basis of prices provided by an independent pricing service. Prices
provided by the pricing service may be determined without exclusive reliance
on quoted prices, and may reflect appropriate factors such as yield, type of
issue, coupon rate and maturity date. Securities for which market prices are
not provided by any of the above methods are valued based upon quotes
furnished by independent sources and are valued at the last bid price in the
case of equity securities and in the case of debt obligations, the mean
between the last bid and asked prices. Securities for which market
quotations are not readily available or are questionable are valued at fair
value as determined in good faith by or under the supervision of the
Company's officers in a manner specifically authorized by the Board of
Directors of the Company. Short-term obligations having 60 days or less to
maturity are valued at amortized cost which approximates market value. For
purposes of determining net asset value per share, futures and options
contracts generally will be valued 15 minutes after the close of trading of
the New York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed
each day at various times prior to the close of the NYSE. The values of such
securities used in computing the net asset value of the Fund's shares are
determined as of such times. Foreign currency exchange rates are also
generally determined prior to the close of the NYSE. Occasionally, events
affecting the values of such securities and such exchange rates may occur
between the times at which they are determined and the close of the NYSE
which would not be reflected in the computation of the Fund's net asset
value. If events materially affecting the value of such securities occur
during such period, then these securities will be valued at their fair value
as determined in good faith by or under the supervision of the Board of
Directors.
B. Securities Transactions, Investment Income and Distributions -- 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 as earned from settlement date
and is recorded on the accrual basis. Dividend income is recorded on the
ex-dividend date. The Fund may elect to use a portion of the proceeds of
capital stock redemptions as distributions for Federal income tax purposes.
Distributions from income and net realized capital gains, if any, are
generally paid annually and recorded on ex-dividend date.
On October 31, 1999, undistributed net investment income was increased
by $41,296,477, undistributed net realized gains decreased by $107,196,477
and paid-in capital increased by $65,900,000 as a result of differing
book/tax treatment of foreign currency transactions, equalization credits
and net operating loss reclassifications in order to comply with the
requirements of the American Institute of Certified Public Accountants
Statement of Position 93-2. Net assets of the Fund were unaffected by the
reclassification discussed above.
C. 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.
D. Foreign Currency Translations -- Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S.
dollar amounts at date of valuation. Purchases and sales of portfolio
securities and income items denominated in foreign currencies are translated
into U.S. dollar amounts on the respective dates of such transactions. The
Fund does not separately account for that portion of the results of
operations resulting from changes in
16
<PAGE> 19
foreign exchange rates on investments and the fluctuations arising from
changes in market prices of securities held. Such fluctuations are included
with the net realized and unrealized gain or loss from investments.
E. Foreign Currency Contracts -- A foreign currency contract is an obligation
to purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a foreign currency contract to attempt to
minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency contract
for the purchase or sale of a security denominated in a foreign currency in
order to "lock in" the U.S. dollar price of that security. The Fund could be
exposed to risk if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
F. Futures Contracts -- The Fund may purchase or sell futures contracts as a
hedge against changes in market conditions. Initial margin deposits required
upon entering into futures contracts are satisfied by the segregation of
specific securities as collateral for the account of the broker (the Fund's
agent in acquiring the futures position). During the period the futures
contracts are open, changes in the value of the contracts are recognized as
unrealized gains or losses by "marking to market" on a daily basis to
reflect the market value of the contracts at the end of each day's trading.
Variation margin payments are made or received depending upon whether
unrealized gains or losses are incurred. When the contracts are closed, the
Fund recognizes a realized gain or loss equal to the difference between the
proceeds from, or cost of, the closing transaction and the Fund's basis in
the contract. Risks include the possibility of an illiquid market and that a
change in value of the contracts may not correlate with changes in the value
of the securities being hedged.
G. Covered Call Options -- The Fund may write call options, but only on a
covered basis; that is, the Fund will own the underlying security. Options
written by the Fund normally will have expiration dates between three and
nine months from the date written. The exercise price of a call option may
be below, equal to, or above the current market value of the underlying
security at the time the option is written. When the Fund writes a covered
call option, an amount equal to the premium received by the Fund is recorded
as an asset and an equivalent liability. The amount of the liability is
subsequently "marked-to-market" to reflect the current market value of the
option written. The current market value of a written option is the mean
between the last bid and asked prices on that day. If a written call option
expires on the stipulated expiration date, or if the Fund enters into a
closing purchase transaction, the Fund realizes a gain (or a loss if the
closing purchase transaction exceeds the premium received when the option
was written) without regard to any unrealized gain or loss on the underlying
security, and the liability related to such option is extinguished. If a
written option is exercised, the Fund realizes a gain or a loss from the
sale of the underlying security and the proceeds of the sale are increased
by the premium originally received.
A call option gives the purchaser of such option the right to buy, and
the writer (the Fund) the obligation to sell, the underlying security at the
stated exercise price during the option period. The purchaser of a call
option has the right to acquire the security which is the subject of the
call option at any time during the option period. During the option period,
in return for the premium paid by the purchaser of the option, the Fund has
given up the opportunity for capital appreciation above the exercise price
should the market price of the underlying security increase, but has
retained the risk of loss should the price of the underlying security
decline. During the option period, the Fund may be required at any time to
deliver the underlying security against payment of the exercise price. This
obligation is terminated upon the expiration of the option period or at such
earlier time at which the Fund effects a closing purchase transaction by
purchasing (at a price which may be higher than that received when the call
option was written) a call option identical to the one originally written.
H. Put Options -- The Fund may purchase put options. By purchasing a put
option, the Fund obtains the right (but not the obligation) to sell the
option's underlying instrument at a fixed strike price. In return for this
right, the Fund pays an option premium. The option's underlying instrument
may be a security or a futures contract. Put options may be used by the Fund
to hedge securities it owns by locking in a minimum price at which the Fund
can sell. If security prices fall, the put option could be exercised to
offset all or a portion of the Fund's resulting losses. At the same time,
because the maximum the Fund has at risk is the cost of the option,
purchasing put options does not eliminate the potential for the Fund to
profit from an increase in the value of the securities hedged.
I. Expenses -- Distribution and transfer agency 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
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 1.0% of
the first $30 million of the Fund's average daily net assets, plus 0.75% of the
Fund's average daily net assets in excess of $30 million to and including $350
million, plus 0.625% of the Fund's average daily net assets in excess of $350
million. AIM has contractually agreed to waive a portion of its advisory fees
payable by the Fund to AIM to the extent necessary to reduce the fees paid by
the Fund at net asset levels higher than those currently incorporated in the
present advisory fee schedule. AIM will receive a fee calculated at the annual
rate of 1.0% of the first $30 million of the Fund's average daily net assets,
plus 0.75% of the Fund's average daily net assets in excess of $30 million to
and including $350 million, plus 0.625% of the Fund's average daily net assets
in excess of $350 million to and including $2 billion, plus 0.60% of the Fund's
average daily net assets in excess of $2 billion to and including $3 billion,
plus 0.575% of the Fund's average daily net assets in
17
<PAGE> 20
excess of $3 billion to and including $4 billion, plus 0.55% of the Fund's
average daily net assets in excess of $4 billion. The waiver is contractual and
may not be terminated without approval of the Board of Directors. During the
year ended October 31, 1999, AIM waived fees of $4,288,405. Under the terms of a
master sub-advisory agreement between AIM and A I M Capital Management, Inc.
("AIM Capital"), AIM pays AIM Capital 50% of the amount paid by the Fund to AIM.
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. During the year ended October 31, 1999, AIM was
paid $281,500 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. During the year ended October 31, 1999, AFS
was paid $5,776,859 for such services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B and Class C shares and a master distribution agreement with
Fund Management Company ("FMC) to serve as the distributor for the Institutional
Class shares of the Fund. The Company has adopted a plan pursuant to Rule 12b-1
under the 1940 Act with respect to the Fund's Class A shares, 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 0.30% of the Fund's average
daily net assets of Class A shares and 1.00% of the average daily net assets of
Class B and C shares. Of these amounts, the Fund may pay a service fee of 0.25%
of the average daily net assets of the Class A, 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. During the year ended October 31, 1999, the Class A,
Class B and Class C shares paid AIM Distributors $22,561,363, $10,382,904 and
$593,913, respectively, as compensation under the Plans.
AIM Distributors received commissions of $2,209,013 from sales of the Class
A shares of the Fund during the year ended October 31, 1999. Such commissions
are not an expense of the Fund. They are deducted from, and are not included in,
the proceeds from sales of Class A shares. During the year ended October 31,
1999, AIM Distributors received $156,642 in contingent deferred sales charges
imposed on redemptions of Fund shares. Certain officers and directors of the
Company are officers and directors of AIM, AFS, FMC and AIM Distributors.
During the year ended October 31, 1999, the Fund paid legal fees of $20,003
for services rendered by Kramer, Levin, Naftalis & Frankel LLP as counsel to the
Company's directors. A member of that firm is a director of the Company.
NOTE 3-INDIRECT EXPENSES
During the year ended October 31, 1999, the Fund received reductions in transfer
agency fees from AFS (an affiliate of AIM) and reductions in custodian fees of
$102,746 and $61,876, respectively, under expense offset arrangements. The
effect of the above arrangements resulted in a reduction of the Fund's total
expenses of $164,622 during the year ended October 31, 1999.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid to directors who are not an
"interested person" of AIM. The Company invests directors' fees, if so elected
by a director, in mutual fund shares in accordance with a deferred compensation
plan.
NOTE 5-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by The Chase Manhattan Bank. 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 year
ended October 31, 1999, 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. Prior to
May 28, 1999, the commitment fee rate was 0.05%. The commitment fee is allocated
among the funds based on their respective average net assets for the period.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the year ended October 31, 1999 was
$10,278,536,302 and $10,386,655,927, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of October 31, 1999 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $3,184,683,541
- ----------------------------------------------------------
Aggregate unrealized appreciation
(depreciation) of investment securities (14,585,229)
- ----------------------------------------------------------
Net unrealized appreciation of investment
securities $3,170,098,312
==========================================================
Cost of investments for tax purposes is $6,484,797,166.
</TABLE>
18
<PAGE> 21
NOTE 7-CALL OPTION CONTRACTS
Transactions in call options written during the year ended October 31, 1999 are
summarized as follows:
<TABLE>
<CAPTION>
CALL OPTION CONTRACTS
-------------------------
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
--------- -------------
<S> <C> <C>
Beginning of period 76,233 $ 44,508,416
- -------------------- --------- -------------
Written 341,015 393,780,650
- -------------------- --------- -------------
Closed (271,232) (293,502,772)
- -------------------- --------- -------------
Exercised (46,212) (3,522,927)
- -------------------- --------- -------------
Expired (7,902) (24,266,746)
- -------------------- --------- -------------
End of period 91,902 $ 116,996,621
==================== ========= =============
</TABLE>
Open call option contracts written at October 31, 1999 were as follows:
<TABLE>
<CAPTION>
OCTOBER 31, UNREALIZED
CONTRACT STRIKE NUMBER OF PREMIUMS 1999 APPRECIATION
ISSUE MONTH PRICE CONTRACTS RECEIVED MARKET VALUE (DEPRECIATION)
- ----------------------------- -------- ------ --------- ------------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
America Online, Inc. Apr-00 $120 20,000 $ 44,712,107 $51,500,000 $ (6,787,893)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Cisco Systems, Inc. Jan-00 70 28,798 22,892,140 24,118,325 (1,226,185)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Compuware Corp. Jan-00 30 4,214 1,409,536 1,211,525 198,011
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
EMC Corp. Apr-00 70 9,000 8,164,527 11,306,250 (3,141,723)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Intel Corp. Apr-00 75 7,200 6,278,190 7,875,000 (1,596,810)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Sanmina Corp. Jan-00 85 6,230 5,665,996 7,281,312 (1,615,316)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Sun Microsystems, Inc. Apr-00 90 5,609 7,835,511 13,636,881 (5,801,370)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
VERITAS Software Corp. Dec-99 95 7,530 6,471,819 13,083,375 (6,611,556)
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
Yahoo! Inc. Jan-00 175 3,321 13,566,795 7,368,469 6,198,326
- ----------------------------- --------- ------ --------- ------------ ------------ --------------
91,902 $116,996,621 137,381,137 (20,384,516)
============================= ========= ====== ========= ============ ============ ==============
</TABLE>
NOTE 8-CAPITAL STOCK
Changes in capital stock outstanding during the years ended October 31, 1999 and
1998 were as follows:
<TABLE>
<CAPTION>
1999 1998
----------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
----------- --------------- ----------- ---------------
<S> <C> <C> <C> <C>
Sold:
Class A 38,697,927 $ 994,480,979 62,788,326 $ 1,368,867,407
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class B 17,982,789 456,125,945 12,056,594 257,385,548
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class C 3,622,407 92,753,207 1,204,025 25,772,311
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Institutional Class 826,477 21,885,030 593,328 13,533,791
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Issued as reinvestment of dividends:
Class A 16,540,521 383,078,048 41,795,514 813,441,370
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class B 2,102,927 47,274,883 3,831,332 73,061,374
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class C 71,213 1,602,275 31,251 600,022
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Institutional Class 217,868 5,146,039 456,144 9,035,386
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Reacquired:
Class A (50,133,647) (1,282,020,107) (79,734,776) (1,740,229,701)
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class B (6,174,366) (155,447,302) (4,228,997) (89,772,805)
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Class C (926,007) (23,418,060) (246,074) (5,178,145)
- ---------------------------------------- -------------- ---------------- ------------ ---------------
Institutional Class (391,478) (10,387,047) (458,838) (10,266,383)
- ---------------------------------------- -------------- ---------------- ------------ ---------------
22,436,631 $ 531,073,890 38,087,829 $ 716,250,175
======================================== ============== ================ ============ ===============
</TABLE>
19
<PAGE> 22
NOTE 9-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A capital stock
outstanding during each of the years in the five-year period ended October 31,
1999, for a share of Class B capital stock outstanding during each of the years
in the four-year period ended October 31, 1999 and the period June 26, 1995
(date sales commenced) through October 31, 1995, and for a share of Class C
capital stock outstanding during each of years in the two year period ended
October 31, 1999 and the period August 4, 1997 (date sales commenced) through
October 31, 1997.
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 21.72 $ 22.72 $ 20.19 $ 20.33 $ 17.82
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Income from investment operations:
Net investment income (loss) (0.10) 0.02 0.01 0.06 --
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Net gains on securities (both realized and unrealized) 8.16 2.38 4.82 2.51 4.36
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Total from investment operations 8.06 2.40 4.83 2.57 4.36
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Less distributions:
Dividends from net investment income (0.01) -- (0.06) -- (0.07)
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Distributions from net realized gains (1.46) (3.40) (2.24) (2.71) (1.78)
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Total distributions (1.47) (3.40) (2.30) (2.71) (1.85)
- ------------------------------------------------------------ ---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 28.31 $ 21.72 $ 22.72 $ 20.19 $ 20.33
============================================================ ========== ========== ========== ========== ==========
Total return(a) 38.62% 12.34% 26.83% 14.81% 28.20%
============================================================ ========== ========== ========== ========== ==========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $8,089,739 $6,094,178 $5,810,582 $4,977,493 $4,564,730
============================================================ ========== ========== ========== ========== ==========
Ratio of expenses to average net assets(b) 1.03%(c) 1.04% 1.07% 1.12% 1.17%
============================================================ ========== ========== ========== ========== ==========
Ratio of net investment income (loss) to average net
assets(d) (0.38)%(c) 0.07% 0.07% 0.33% (0.02)%
============================================================ ========== ========== ========== ========== ==========
Portfolio turnover rate 124% 125% 128% 159% 139%
============================================================ ========== ========== ========== ========== ==========
</TABLE>
(a) Does not deduct sales charges.
(b) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
1.08%, 1.09%, 1.11%, 1.15% and 1.19% for 1999-1995.
(c) Ratios are based on average net assets of $7,520,454,321.
(d) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (0.43)%, 0.02%, 0.03%, 0.30%, and (0.04)% for 1999-1995.
20
<PAGE> 23
NOTE 9-FINANCIAL HIGHLIGHTS-continued
<TABLE>
<CAPTION>
CLASS B CLASS C
--------------------------------------------------------- ------------------------------
1999 1998 1997 1996 1995 1999 1998 1997
---------- -------- -------- -------- ------- -------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 21.12 $ 22.34 $ 19.98 $ 20.28 $ 18.56 $ 21.14 $ 22.34 $ 22.83
- ------------------------------------ ---------- -------- -------- -------- ------- -------- ------- -------
Income from investment operations:
Net investment income (loss) (0.30)(a) (0.15)(a) (0.15)(a) (0.05)(a) (0.03) (0.30)(a) (0.15)(a) (0.04)(a)
- ------------------------------------ ---------- -------- -------- -------- ------- -------- ------- -------
Net gains (losses) on securities
(both realized and unrealized) 7.93 2.33 4.75 2.46 1.75 7.92 2.35 (0.45)
- ------------------------------------ ---------- -------- -------- -------- ------- -------- ------- -------
Total from investment operations 7.63 2.18 4.60 2.41 1.72 7.62 2.20 (0.49)
- ------------------------------------ ---------- -------- -------- -------- ------- -------- ------- -------
Distributions from net realized
gains (1.46) (3.40) (2.24) (2.71) -- (1.46) (3.40) --
- ------------------------------------ ---------- -------- -------- -------- ------- -------- ------- -------
Net asset value, end of period $ 27.29 $ 21.12 $ 22.34 $ 19.98 $ 20.28 $ 27.30 $ 21.14 $ 22.34
==================================== ========== ======== ======== ======== ======= ======== ======= =======
Total return(b) 37.59% 11.45% 25.78% 13.95% 9.27% 37.50% 11.54% (2.15)%
==================================== ========== ======== ======== ======== ======= ======== ======= =======
Ratios/supplemental data:
Net assets, end of period (000's
omitted) $1,291,456 $705,750 $486,105 $267,459 $42,238 $105,420 $23,107 $ 2,326
==================================== ========== ======== ======== ======== ======= ======== ======= =======
Ratio of expenses to average net
assets(c) 1.82%(d) 1.83% 1.87% 1.95% 1.91%(e) 1.82%(d) 1.83% 1.84%(e)
==================================== ========== ======== ======== ======== ======= ======== ======= =======
Ratio of net investment income
(loss) to average net assets(f) (1.17)%(d) (0.72)% (0.73)% (0.50)% (0.76)%(e) (1.17)%(d) (0.72)% (0.70)%(e)
==================================== ========== ======== ======== ======== ======= ======== ======= =======
Portfolio turnover rate 124% 125% 128% 159% 139% 124% 125% 128%
==================================== ========== ======== ======== ======== ======= ======== ======= =======
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct contingent deferred sales charges and is not annualized for
periods less than one year.
(c) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
1.87%, 1.87%, 1.91%, 1.98% and 1.94% (annualized) for 1999-1995 for Class B
and 1.87%, 1.87%, 1.88% (annualized) for 1999-1997 for Class C.
(d) Ratios are based on average net assets of $1,038,290,381 and $59,391,348
for Class B and Class C, respectively.
(e) Annualized.
(f) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (1.22)%, (0.76)%, (0.77)%, (0.53)% and (0.79)%
(annualized) for 1999-1995 for Class B and (1.22)%, (0.76)%, (0.74)%
(annualized) for 1999-1997 for Class C.
21
<PAGE> 24
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors
AIM Equity Funds, Inc.:
We have audited the accompanying statement of assets and
liabilities of AIM Weingarten Fund (a portfolio of AIM
Equity Funds, Inc.), including the schedule of
investments, as of October 31, 1999, the related
statement of operations for the year then ended, the
statement of changes in net assets for each of the years
in the two-year period then ended, and financial
highlights for each of the years in the five-year period
then ended. These financial statements and financial
highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion
on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that
we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and
financial highlights are free of material misstatement.
An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of
securities owned as of October 31, 1999, by
correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used
and significant estimates made by management, as well as
evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and
financial highlights referred to above present fairly, in
all material respects, the financial position of AIM
Weingarten Fund as of October 31, 1999, the results of
its operations for the year then ended, the changes in
its net assets for each of the years in the two-year
period then ended, and the financial highlights for each
of the years in the five-year period then ended in
conformity with generally accepted accounting principles.
KPMG LLP
December 3, 1999
Houston, Texas
22
<PAGE> 25
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; Carol F. Relihan A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Secretary 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Gary T. Crum Houston, TX 77046
Senior Vice President
Owen Daly II SUB-ADVISOR
Director Edgar M. Larsen
Cortland Trust Inc. Senior Vice President A I M Capital Management, Inc.
11 Greenway Plaza
Edward K. Dunn Jr. Dana R. Sutton Suite 100
Chairman, Mercantile Mortgage Corp.; Vice President and Treasurer Houston, TX 77046
Formerly Vice Chairman and President,
Mercantile-Safe Deposit & Trust Co.; and Melville B. Cox TRANSFER AGENT
President, Mercantile Bankshares Vice President
A I M Fund Services, Inc.
Jack Fields Mary J. Benson P.O. Box 4739
Chief Executive Officer Assistant Vice President and Houston, TX 77210-4739
Texana Global, Inc.; Assistant Treasurer
Formerly Member CUSTODIAN
of the U.S. House of Representatives Sheri Morris
Assistant Vice President and State Street Bank and Trust Company
Carl Frischling Assistant Treasurer 225 Franklin Street
Partner Boston, MA 02110
Kramer, Levin, Naftalis & Frankel LLP Renee A. Friedli
Assistant Secretary COUNSEL TO THE FUND
Robert H. Graham
President and Chief Executive Officer P. Michelle Grace Ballard Spahr
A I M Management Group Inc. Assistant Secretary Andrews & Ingersoll, LLP
1735 Market Street
Prema Mathai-Davis Nancy L. Martin Philadelphia, PA 19103
Chief Executive Officer, YWCA of the U.S.A.; Assistant Secretary
Commissioner, New York City Dept. for the COUNSEL TO THE DIRECTORS
Aging; and member of the Board of Directors, Ofelia M. Mayo
Metropolitan Transportation Authority of Assistant Secretary Kramer, Levin, Naftalis & Frankel LLP
New York State 919 Third Avenue
Lisa A. Moss New York, NY 10022
Lewis F. Pennock Assistant Secretary
Attorney DISTRIBUTOR
Kathleen J. Pflueger
Louis S. Sklar Assistant Secretary A I M Distributors, Inc.
Executive Vice President 11 Greenway Plaza
Hines Interests Samuel D. Sirko Suite 100
Limited Partnership Assistant Secretary Houston, TX 77046
Stephen I. Winer AUDITORS
Assistant Secretary
KPMG LLP
700 Louisiana
Houston, TX 77002
</TABLE>
REQUIRED FEDERAL INCOME TAX INFORMATION
AIM Weingarten Fund paid ordinary dividends in the amount of $0.0142 per share
to Class A shareholders during its tax year ended October 31, 1999. Of this
amount 12.47% is eligible for the dividends received deduction for corporations.
The Fund also distributed long-term capital gains of $527,135,325 for Class A,
Class B and Class C shares during its tax year ended October 31, 1999.
23
<PAGE> 26
-------------------------------------
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AIM INVESTOR LINE,
800-246-5463,
PROVIDES CURRENT ACCOUNT
INFORMATION AND THE PRICE,
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ON ALL AIM FUNDS
24 HOURS A DAY.
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AIM FUNDS(SM) MAKES
INVESTING EASY
o AIM Bank Connection(SM). You can make investments in your AIM account in
amounts from $50 to $100,000 without writing a check. Once you set up this
convenient feature, AIM will draw the funds from your pre-authorized
checking account at your request.
o AIM INTERNET CONNECT(SM). With this service, you can purchase, redeem or
exchange shares of AIM funds in your current AIM account simply by accessing
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or 403(b), only exchanges are allowed over the Internet because of the
tax-reporting and record-keeping requirements these accounts involve.
o AUTOMATIC REINVESTMENT OF DIVIDENDS AND/OR CAPITAL GAINS. You can receive
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paying a sales charge. Over time, the power of compounding can significantly
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o AUTOMATIC INVESTMENT PLAN. You can add to your account by authorizing your
AIM fund to withdraw a specified amont, minimum $50, from your bank account,
on a regular schedule.
o EASY ACCESS TO YOUR MONEY. You can redeem shares of your AIM fund any day
the New York Stock Exchange is open. The value of the shares may be more or
less than their original cost depending on market conditions.
o EXCHANGE PRIVILEGE. As your investment goals change, you may exchange part
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year.
o TAX-ADVANTAGED RETIREMENT PLANS. You can enjoy the tax advantages offered by
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o E-MAIL ACCESS. You can contact us at [email protected] for general
information. For account information, contact us at
[email protected].
o www.aimfunds.com. Our award-winning Web site provides account information,
shareholder education and fund performance information.
<PAGE> 27
THE AIM FAMILY OF FUNDS --Registered Trademark--
<TABLE>
<S> <C> <C>
GROWTH FUNDS MONEY MARKET FUNDS A I M Management Group Inc. has
AIM Aggressive Growth Fund(1) AIM Money Market Fund provided leadership in the mutual
AIM Blue Chip Fund AIM Tax-Exempt Cash Fund fund industry since 1976 and
AIM Capital Development Fund managed approximately $120
AIM Constellation Fund INTERNATIONAL GROWTH FUNDS billion in assets for more than
AIM Dent Demographic Trends Fund AIM Advisor International Value Fund 6.4 million shareholders,
AIM Large Cap Growth Fund AIM Asian Growth Fund including individual investors,
AIM Mid Cap Equity Fund AIM Developing Markets Fund corporate clients and financial
AIM Mid Cap Growth Fund AIM Euroland Growth Fund(4) institutions, as of September 30,
AIM Mid Cap Opportunities Fund AIM European Development Fund 1999.
AIM Select Growth Fund AIM International Equity Fund The AIM Family of Funds
AIM Small Cap Growth Fund(2) AIM Japan Growth Fund --Registered Trademark-- is
AIM Small Cap Opportunities Fund(3) AIM Latin American Growth Fund distributed nationwide, and AIM
AIM Value Fund AIM New Pacific Growth Fund today is the 10th-largest mutual
AIM Weingarten Fund fund complex in the United States
GLOBAL GROWTH FUNDS in assets under management,
GROWTH & INCOME FUNDS AIM Global Aggressive Growth Fund according to Strategic Insight,
AIM Advisor Flex Fund AIM Global Growth Fund an independent mutual fund
AIM Advisor Large Cap Value Fund monitor.
AIM Advisor Real Estate Fund GLOBAL GROWTH & INCOME FUNDS
AIM Balanced Fund AIM Global Growth & Income Fund
AIM Basic Value Fund AIM Global Utilities Fund
AIM Charter Fund
GLOBAL INCOME FUNDS
INCOME FUNDS AIM Emerging Markets Debt Fund
AIM Floating Rate Fund AIM Global Government Income Fund
AIM High Yield Fund AIM Global Income Fund
AIM High Yield Fund II AIM Strategic Income Fund
AIM Income Fund
AIM Intermediate Government Fund THEME FUNDS
AIM Limited Maturity Treasury Fund AIM Global Consumer Products and Services Fund
AIM Global Financial Services Fund
TAX-FREE INCOME FUNDS AIM Global Health Care Fund
AIM High Income Municipal Fund AIM Global Infrastructure Fund
AIM Municipal Bond Fund AIM Global Resources Fund
AIM Tax-Exempt Bond Fund of Connecticut AIM Global Telecommunications and Technology Fund(5)
AIM Tax-Free Intermediate Fund AIM Global Trends Fund(6)
</TABLE>
(1) AIM Aggressive Growth Fund reopened to new investors on November 16, 1998.
(2) AIM Small Cap Growth Fund closed to new investors on November 8, 1999. (3)
AIM Small Cap Opportunities Fund closed to new investors on November 4, 1999.
(4) On September 1, 1999, AIM Europe Growth Fund was renamed AIM Euroland Growth
Fund. Previously the fund invested in all size companies in most areas of
Europe. The fund now seeks to invest at least 65%of its assets in large-cap
companies within countries using the euro as their currency (EMU-member
countries). (5) On June 1, 1999, AIM Global Telecommunications Fund was renamed
AIM Global Telecommunications and Technology Fund. (6) Effective August 27,
1999, AIM Global Trends Fund was restructured to operate as a traditional mutual
fund. Before that date, the fund operated as a fund of funds. For more complete
information about any AIM fund(s), including sales charges and expenses, ask
your financial advisor or securities dealer for a free prospectus(es). Please
read the prospectus(es) carefully before you invest or send money. If used as
sales material after January 20, 2000, this report must be accompanied by a
current Quarterly Review of Performance for AIM Funds.
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AIM Distributors, Inc. WEI-AR-1
