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[LOGO]
EATON VANCE(R)
==============
[Photo of Pillars and Steps]
Annual Report June 30, 2000
[Photo of Bridge with Buildings]
EATON VANCE
SENIOR
INCOME
TRUST
[symbol]
75 YEARS OF EXCELLENCE
EATON 75th VANCE
ANNIVERSARY
[Photo of Large Hall]
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EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
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LETTER TO SHAREHOLDERS
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[Photo of James B. Hawkes]
James B. Hawkes
President
In a difficult period for fixed-income investors, Eaton Vance Senior Income
Trust again provided a significant yield advantage in a portfolio of senior,
secured floating-rate loans. Based on the Trust's June monthly dividend of
$0.077 per share and a closing share price of $9.3125, the Trust's market yield
was 9.92% at June 30, 2000.
Amid rising interest rates, the Trust maintained a yield
advantage over similar-maturity investments...
The first six months of 2000 featured significant volatility in the financial
markets. A vigilant Federal Reserve pushed short-term interest rates sharply
higher to combat signs of inflation. As a result, bonds and other
interest-rate-sensitive investments were under severe pressure during much of
the period. Meanwhile, the stock market, which has defied gravity in recent
years, underwent a major correction, making many investors wary of the
increasingly skittish equity markets.
Because of their unique reset feature, the Trust's floating-rate loans have been
able to respond quickly to increases in interest rates, providing a
correspondingly higher yield to shareholders as rates increased. Eaton Vance
Senior Income Trust was thus able to maintain its significant yield advantage
over investments with similar maturities.
Eaton Vance Senior Income Trust may provide attractive
opportunities in the year ahead...
In 2000, following years of surging stock prices, we have seen ample testimony
of the equity market's tendency to revert to historical trends. Given the
significant price movements in the equity and bond markets, it is understandable
that risk-conscious investors should seek a measure of refuge from such
volatility. By investing at least 80% of its assets in senior, floating-rate
loans, Eaton Vance Senior Income Trust is able to provide a high level of
current yield. And, because the Trust's shares are traded on the New York Stock
Exchange, they provide daily liquidity.
In addition to these compelling advantages, we believe that the senior
floating-rate market will continue to present attractive income opportunities
for shareholders, as more companies utilize the loan market to raise capital. In
the pages that follow, co-portfolio managers Scott Page and Payson Swaffield
review the Trust's activities in the past year and look ahead to more such
opportunities in the coming year.
Sincerely,
/s/ James B. Hawkes
James B. Hawkes
President
August 9, 2000
Trust Information
as of June 30, 2000
Performance(1)
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Cumulative Total Return (by share price, NYSE)
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One Year 2.00%
Life of Fund (10/30/98) 7.58
Cumulative Total Return (at net asset value)
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One Year 6.49%
Life of Fund (10/30/98) 7.58
Ten Largest Holdings(2)
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Panavision International LP 1.4%
FHC Health Systems, Inc. 1.4
Acordia, Inc. 1.4
Tokheim Corp. 1.1
Globe Manufacturing Corp. 1.1
U.S. Office Products 1.0
Joan Fabrics Corporation 1.0
Huntsman Corp. 1.0
Communications & Power Industries, Inc. 0.9
Kindercare Learning Centers, Inc. 0.9
(1) Returns are calculated by determining the percentage change in net asset
value and share price with all distributions reinvested. (2) Ten largest
holdings account for 11.2% of the Trust's investments, determined by dividing
the total market value of the holdings by the total net assets of the Trust.
Holdings are subject to change.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when sold, may be worth more or
less than their original cost.
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EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
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MANAGEMENT DISCUSSION
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[Photo of Scott H. Page]
Scott H. Page
[Photo of Payson F. Swaffield]
Payson F. Swaffield
An interview with Scott H. Page and Payson F. Swaffield, co-portfolio managers
of Eaton Vance Senior Income Trust.
Q: SCOTT, the first half of 2000 featured continuing volatility in the
financial markets. How would you evaluate the Trust's performance in that
environment?
A: MR. PAGE: The Fund's share price experienced fluctuation in the past six
months, reflecting, in part, the shifting dynamics in the broad credit
markets. But the change in the Trust's share price was fairly modest, espe-
cially when compared to the volatility that was seen in some segments of the
bond market.
Once again, the Trust benefited from the interest-rate reset feature of its
senior, floating-rate loans, which enables investors to benefit from rising
rates, unlike the securities in most fixed-income vehicles. The Trust's
market yield at June 30 reflected those increases. So, moreover, I'd say
that the Trust's portfolio of senior, floating-rate loans performed
generally in line with expectations.
Q: The Federal Reserve has aggressively raised short-term interest rates in the
past year. Have those moves been reflected in the loan market?
A: MR. SWAFFIELD: Yes. The Fed has raised its benchmark Federal Funds rate -
a key short-term rate barometer - a total of six times since June 1999.
Those rate hikes have consistently been reflected in LIBOR, the rate on
which floating-rate loan interest rates are generally based. The Federal
Reserve has indicated that it will continue to monitor the economy for
signs of a return of inflation. While there have been some anecdotal
signs of a slower economy, it is not yet clear that the Fed has achieved
the "soft landing" it has hoped for. Thus, while bonds remain vulnerable
to further rate hikes, floating-rate loans could benefit further.
Five largest sector weightings(1)
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Cable Television 7.3%
Telecommunications - Wireless 6.6%
Telecommunications - Wireline 6.6%
Manufacturing 6.6%
Chemicals 6.2%
Trust Overview(1)
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Total net assets $350 million
Number of borrowers 210
Industries represented 51
Collateral coverage ratio 1.5 to 1
Weighted days-to-interest rate reset 54 days
Average maturity 5.7 Yrs.
Average size per borrowing $1.9 million
(1) Five largest sector weightings account for 31.5% of the Trust's investments,
determined by dividing the total market value of the holdings by the total
net assets of the Fund. Sector Weightings and Trust Overview are as of
6/30/00 and are subject to change. Trust Overview information refers only to
senior, secured floating-rate loan portion of the Trust.
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SHARES OF THE TRUST ARE NOT INSURED BY THE FDIC AND ARE NOT DEPOSITS
OR OTHER OBLIGATIONS OF, OR GUARANTEED BY, ANY DEPOSITORY INSTITUTION.
SHARES ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF
PRINCIPAL INVESTED. YIELD WILL CHANGE.
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Q: Has the loan market continued to expand in this environment?
A: MR. PAGE: The loan market has continued to grow in dollar volume, deal
activity and the number of market participants. Syndicated leveraged loan
volume exceeded $315 billion in 1999, according to Loan Pricing Corp.
Loan volume has remained strong in 2000, with improving liquidity and
increasing market depth. From a quality standpoint, there are signs that
investors are becoming more demanding. That has resulted in more
conservative credit structures, with significantly lower debt-to-capital
ratios. That's a healthy development for borrowers, for investors and for
the market.
Q: You referred to the shifting dynamics in the credit markets during the
period. Could you discuss that further?
A: MR. SWAFFIELD: Yes. Just as we witnessed in the broader capital markets,
there has been a shift in focus away from "old economy" companies toward
the "new economy" companies. Media and telecom companies have been among
the most active borrowers in recent years, and that trend is expected to
continue in 2000. These new economy companies have significant
capital requirements and the loan market is increasingly viewed as an
attractive alternative to the bond markets.
Moreover, this focus on new economy companies has often limited refinancing
options for commercial and industrial companies, causing a capital crunch
for some companies. While this trend has resulted in rising default rates
and is likely to continue over the near-term, we're starting to see more
interest in these traditional cash-flow generators. That is certainly
positive for the loan market.
Q: How have you positioned the Trust in recent months?
A: MR. PAGE: We've continued our efforts to broaden our diversification. At
June 30, 2000, the senior, floating-rate loan portion of the Trust was
composed of 210 borrowers, a significant increase from a year ago. The
ten largest senior floating-rate loan holdings represented only 11.2% of
the Trust, indicating a limited exposure to risk in any single borrower.
We had investments in 51 different industries, spanning most sectors in
the overall economy.
The Trust's largest weightings were in cable television and
telecommunications. Given the backdrop of a slowing U.S. economy, we have
generally focused on the growth sectors, while reducing the Trust's exposure
to cyclical areas. The Fund continued its prudent use of leverage to add
incrementally to yield. At June 30, the Fund had $129 million in leverage.
That figure represented 26.7% of the Fund's total assets.
Q: Could we discuss some of the Trust's cable television investments?
A: MR. SWAFFIELD: Yes. As competition from other technologies has increased,
cable companies have begun to deploy a broader range of services to
customers. The most important of these is Internet delivery. Currently,
cable appears to offer the best two-way connection from the home to the
Internet. The Trust has maintained an exposure to large national
companies as well as smaller companies with strength in local markets.
Charter Communications is the nation's fourth largest cable network. Led by
Microsoft co-founder Paul Allen, Charter has been a pioneer in providing
bandwidth-intensive, interactive services, including Internet, music
downloading, bill-paying and e-commerce. In the first quarter of 2000,
Charter saw revenues increase more than fourfold from a year earlier.
Classic Cable, Inc. focuses on smaller, nonmetropolitan markets, primarily
in the south and southwest. Through an aggressive acquisition strategy,
Classic has achieved rapid growth in its niche markets and now claims more
than 400,000 subscribers.
Q: Where have you focused the Trust's investments in the telecom sector?
A: MR. PAGE: The telecom market has enjoyed staggering growth in recent
years, but is characterized by increasing competition. We have therefore
focused on companies that are continuing to generate impressive growth
and increase market share. Microcell Connections, Inc. is one of Canada's
fastest-growing wireless providers. The company continues to expand its
network, which already covers 53% of Canada's population. In the U.S.,
Western Wireless provides cellular phone service in 19 western states
under the Cellular One brand name. The company continues to produce
strong revenue growth. Nextel Communications, Inc. provides digital
wireless services in major metropolitan areas, primarily to business
customers. The company serviced 6 million digital units in the first half
of 2000 and witnessed a 59% rise in revenues in the second quarter.
Q: Are there any other notable investments you'd like to discuss?
A: MR. SWAFFIELD: As Scott mentioned earlier, while telecom and cable bonds
have increasingly dominated new issue volume, we have increased our
efforts to diversify the Trust's holdings. In the lodging sector,
Starwood Hotels & Resorts is one of the world's largest operators, with
725 hotels in 80 countries. The company continues to build up its major
brands, which include Westin, Sheraton and St.Regis. Starwood signed
contracts for 30,000 new hotel rooms in 1999 alone, and is on a similar
pace in 2000. Importantly, while the company is in a fast-growth mode,
management has not neglected its balance sheet. Over the last three
years, Starwood has divested itself of $7 billion in non-strategic
assets, using the proceeds, in part, to pay down debt.
Elsewhere, Cambridge Industries was an example of a successful recovery
situation. Cambridge is a leading manufacturer of reinforced plastics for
the auto industry. In recent years, the company became overextended through
large capital investments to upgrade their platforms. Overextended, the
company filed for bankruptcy.
In our view, at its depressed, post-bankrupcy levels, Cambridge represented
good value, especially considering its strong asset base and excellent
collateral. That judgement was rewarded when the company was taken over by a
competitor, Meridian Automotive Systems, which subsequently redeemed the
outstanding Cambridge bonds at par.
Q: The Trust has the flexibility to invest in high-yield bonds. Where did you
focus your high-yield investments?
A: MR. PAGE: The Trust had 12.3% of its investments invested in high-yield
bonds at June 30. The high-yield market encountered some turbulence in the
first six months of the year, reflecting the volatility in the equity
markets. However, rising interest rates did not have the same impact on the
high-yield universe as they did on the investment grade market. Default
rates rose to 5.4% in the second quarter of 2000. While that is somewhat
elevated from recent levels, it is significantly lower than the 10% rates of
a decade ago.
Among its high-yield holdings, the Trust emphasized telecommunications,
broadcasting and cable companies. These companies continue to experience
robust growth and are using rising revenues to complete the build-out of
their wireless networks and infrastructure.
Q: What is your outlook for the loan market in the coming year?
A: MR. SWAFFIELD: Recent evidence suggests that the economy is moderating.
If the economy slows significantly in the coming year, the Trust should
be well-positioned through its defensive holdings. On the other hand, if
the economy, which has proven so resilient, continues to expand, the
Trust's interest rate reset feature should allow us to respond quickly to
changing interest rate conditions.
MR. PAGE: The Trust aims to give conservative investors a short-maturity
investment with the ability to outpace inflation, preserve purchasing
power and provide daily liquidity. We believe that senior, floating-rate
loans represent excellent vehicles for those investors and will continue
to pursue such opportunities in the coming year.
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EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
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PORTFOLIO OF INVESTMENTS
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Senior, Floating Rate Loan
Interests -- 116.1%(2)
Principal
Amount Borrower/Tranche Description Value
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Advertising -- 0.6%
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Lamar Media Corp.
$ 2,000,000 Term loan, maturing March 1, 2006 $ 2,003,750
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$ 2,003,750
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Aerospace & Defense -- 2.4%
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Aerostructures Corporation
$ 1,887,500 Term loan, maturing September 30, 2004 $ 1,887,500
Aircraft Braking Systems Corp.
1,378,671 Term loan, maturing September 30, 2005 1,378,671
Dyncorp
924,000 Term loan, maturing December 9, 2006 922,460
EG&G Technical Services, Inc.
991,377 Term loan, maturing August 20, 2007 991,377
Fairchild Holdings Corporation
1,167,529 Term loan, maturing April 30, 2006 1,167,529
United Defense Industries, Inc.
1,000,000 Term loan, maturing October 6, 2005 994,750
1,000,000 Term loan, maturing October 6, 2006 994,750
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$ 8,337,037
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Air Freight & Couriers -- 0.6%
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Evergreen International Aviation, Inc.
$ 478,735 Term loan, maturing April 30, 2002 $ 476,541
1,435,522 Term loan, maturing April 30, 2003 1,428,944
204,152 Term loan, maturing May 31, 2003 203,216
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$ 2,108,701
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Auto Components -- 5.8%
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Accuride Corporation
$ 1,940,000 Term loan, maturing January 21, 2007 $ 1,940,000
American Axle & Manufacturing, Inc.
1,997,333 Term loan, maturing April 30, 2006 1,993,135
Cambridge Industries, Inc.
1,897,028 Term loan, maturing June 30, 2005 1,897,028
Collins & Aikman
1,940,000 Term loan, maturing June 30, 2006 1,921,207
Dura Operating Corp.
2,493,750 Term loan, maturing March 31, 2006 2,496,478
Federal-Mogul Corporation
2,982,857 Term loan, maturing February 24, 2005 2,947,436
Insilco Corporation
938,480 Term loan, maturing November 24, 2005 938,480
Key Plastics, LLC.
1,738,741 Term loan, maturing March 26, 2005 1,721,353
Oshkosh Truck Corporation
514,588 Term loan, maturing March 31, 2005 514,588
514,588 Term loan, maturing March 31, 2006 514,588
Stanadyne Automotive Corporation
1,492,554 Term loan, maturing December 10, 2004 1,492,554
Tenneco Automotive
1,000,000 Term loan, maturing December 31, 2007 994,375
1,000,000 Term loan, maturing December 31, 2008 994,375
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$ 20,365,597
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Auto Rental -- 0.3%
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Avis Rent A Car, Inc.
$ 499,333 Term loan, maturing June 30, 2006 $ 499,697
499,333 Term loan, maturing June 30, 2007 499,730
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$ 999,427
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Broadcast Media -- 1.9%
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Benedek Broadcasting Corporation
$ 1,000,000 Term loan, maturing November 20, 2007 $ 995,938
Corus Entertainment
1,000,000 Term loan, maturing August 31, 2007 1,000,000
Gray Communications Systems
1,000,000 Term loan, maturing December 31, 2005 1,000,000
TLMD Aquisition Co.
1,985,000 Term loan, maturing March 31, 2007 1,985,000
Young Broadcasting, Inc.
1,500,000 Term loan, maturing December 31, 2006 1,500,000
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$ 6,480,938
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Cable Television -- 7.1%
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Benchmark Genesis, LLC
$ 1,000,000 Term loan, maturing September 30, 2007 $ 1,000,000
CC Michigan/CC New England, LLC.
1,000,000 Term loan, maturing June 30, 2008 996,250
Century Cable Holdings, LLC
2,000,000 Term loan, maturing June 30, 2009 2,007,812
Charter Communications Operating, LLC.
3,000,000 Term loan, maturing March 18, 2008 2,978,499
Charter Communications VIII
2,000,000 Term loan, maturing February 2, 2008 2,001,458
Chelsea Communications, Inc.
2,902,728 Term loan, maturing December 31, 2004 2,902,728
Classic Cable, Inc.
868,421 Term loan, maturing October 31, 2007 868,530
Falcon Holding Group, L.P.
1,970,000 Term loan, maturing December 31, 2007 1,960,643
Frontiervision Operating Partners, L.P.
2,484,438 Term loan, maturing March 31, 2006 2,476,157
Insight Kentucky Partners I, L.P.
2,000,000 Term loan, maturing April 30, 2008 1,983,750
Mediacom USA, LLC
1,000,000 Revolving loan, maturing September 30, 2008 1,000,000
RCN Corporation
2,000,000 Term loan, maturing June 30, 2007 1,994,822
UCA Corp.
2,500,000 Term loan, maturing May 15, 2007 2,500,000
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$ 24,670,649
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Casinos & Gaming -- 1.7%
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Boyd Gaming Corporation
$ 1,982,481 Term loan, maturing June 15, 2003 $ 1,982,481
Horseshoe Gaming Holding Corp.
1,984,000 Term loan, maturing September 30, 2006 1,984,000
Isle of Capri Casinos
1,066,667 Term loan, maturing March 2, 2006 1,072,286
933,333 Term loan, maturing March 2, 2007 938,250
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$ 5,977,017
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Chemicals -- 5.7%
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Arteva B.V. (Kosa)
$ 2,896,260 Term loan, maturing December 31, 2006 $ 2,913,458
Foamex L.P.
423,695 Term loan, maturing June 30, 2005 416,016
385,179 Term loan, maturing June 30, 2006 378,198
1,970,028 Term loan, maturing December 31, 2006 1,934,321
Georgia Gulf Corporation
994,996 Term loan, maturing December 31, 2006 1,001,090
Huntsman Corporation
3,407,665 Term loan, maturing September 30, 2003 3,382,108
Huntsman ICI Chemicals LLC
1,237,500 Term loan, maturing June 30, 2007 1,246,992
1,237,500 Term loan, maturing June 30, 2008 1,246,992
Lyondell Petrochemical Company
2,962,500 Term loan, maturing June 30, 2007 3,050,069
Polymer Group, Inc.
2,927,809 Term loan, maturing December 20, 2005 2,927,809
Sybron Chemicals Inc.
1,496,250 Term loan, maturing March 31, 2007 1,496,250
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$ 19,993,303
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Coal -- 0.5%
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P&L Coal Holdings Corporation
$ 1,900,000 Term loan, maturing June 30, 2006 $ 1,897,150
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$ 1,897,150
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Commercial Services -- 4.8%
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Advanstar Communications Inc.
$ 985,819 Term loan, maturing June 30, 2007 $ 986,640
American Marketing Industries, Inc.
1,343,760 Term loan, maturing November 30, 2002 1,343,760
620,497 Term loan, maturing November 30, 2004 620,497
Coinmach Laundry Corporation
2,927,289 Term loan, maturing June 30, 2005 2,919,514
Environmental Systems Products Hldgs, Inc.
1,969,912 Term loan, maturing September 30, 2005 1,969,912
Metokote Corporation
995,000 Term loan, maturing November 2, 2005 995,000
MSX International, Inc.
995,000 Term loan, maturing December 31, 2006 995,000
Nationsrent, Inc.
2,000,000 Term loan, maturing September 30, 2006 1,982,500
United Rentals, Inc.
2,970,000 Term loan, maturing June 30, 2006 2,934,731
Volume Services, Inc.
1,955,651 Term loan, maturing December 31, 2002 1,955,651
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$ 16,703,205
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Communications Equipment -- 4.0%
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Amphenol Corporation
$ 1,879,137 Term loan, maturing May 19, 2006 $ 1,867,744
Communications & Power Industries, Inc.
275,618 Term loan, maturing August 11, 2000 275,618
2,844,523 Term loan, maturing August 11, 2002 2,844,523
Communications Instruments
979,670 Term loan, maturing March 15, 2004 979,670
General Cable Corporation
1,789,375 Term loan, maturing May 31, 2007 1,782,665
Mitel Corporation
1,499,994 Term loan, maturing December 12, 2003 1,499,994
Superior Telecom, Inc.
2,859,974 Term loan, maturing November 27, 2005 2,853,078
Viasystems, Inc.
1,000,000 Term loan, maturing March 31, 2007 999,531
1,000,000 Term loan, maturing March 31, 2007 999,531
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$ 14,102,354
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Computer Software & Services -- 0.6%
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Titan Corporation
$ 1,995,000 Term loan, maturing March 31, 2006 $ 1,995,000
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$ 1,995,000
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Construction & Engineering -- 0.6%
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International Technology Corporation
$ 1,000,000 Term loan, maturing June 11, 2004 $ 1,000,000
URS Corporation
473,648 Term loan, maturing June 9, 2006 473,648
473,648 Term loan, maturing June 9, 2007 473,648
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$ 1,947,296
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Construction Materials -- 1.1%
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Tapco International Corporation
$ 618,750 Term loan, maturing June 23, 2007 $ 618,750
371,250 Term loan, maturing June 23, 2008 371,250
Trussway Industries, Inc.
997,500 Term loan, maturing December 31, 2006 997,500
U.S. Aggregates, Inc.
2,000,000 Term loan, maturing March 31, 2006 2,000,000
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$ 3,987,500
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Containers & Packaging - Metal & Glass -- 2.0%
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Ball Corporation
$ 2,481,108 Term loan, maturing March 10, 2006 $ 2,483,135
Consolidated Container Holdings LLC
2,985,000 Term loan, maturing June 30, 2007 2,972,875
Graham Packaging Company
1,495,256 Term loan, maturing January 31, 2007 1,492,612
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$ 6,948,622
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Containers & Packaging - Paper -- 3.2%
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ACX Technologies, Inc.
$ 842,500 Term loan, maturing August 3, 2000 $ 828,547
Blue Ridge Paper Products, Inc.
895,334 Term loan, maturing March 31, 2006 895,334
Gaylord Container Corporation
1,989,899 Term loan, maturing June 19, 2004 1,989,899
Impaxx, Inc.
990,000 Term loan, maturing December 31, 2005 990,000
Jefferson Smurfit Corporation
2,678,092 Term loan, maturing March 24, 2006 2,682,808
RIC Holding, Inc.
1,940,350 Term loan, maturing February 28, 2004 1,945,909
Stone Container Corporation
2,000,000 Term loan, maturing October 1, 2003 2,005,384
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$ 11,337,881
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Containers & Packaging - Plastics -- 0.6%
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Tekni-Plex, Inc.
$ 2,000,000 Term loan, maturing June 30, 2008 $ 2,000,000
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$ 2,000,000
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Educational Services -- 1.9%
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Jostens, Inc.
$ 1,500,000 Term loan, maturing May 31, 2008 $ 1,504,875
Kindercare Learning Centers, Inc.
3,096,541 Term loan, maturing February 13, 2006 3,086,221
Language Line, LLC
992,500 Term loan, maturing March 31, 2006 992,500
Weekly Reader Corporation
995,000 Term loan, maturing September 30, 2007 995,000
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$ 6,578,596
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Electronic Equipment & Instruments -- 0.8%
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Gentek, Inc.
$ 990,000 Term loan, maturing April 30, 2007 $ 990,000
Knowles Electronics, Inc.
1,000,000 Term loan, maturing June 29, 2007 1,000,000
Stoneridge
966,914 Term loan, maturing December 31, 2005 972,202
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$ 2,962,202
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Entertainment -- 3.9%
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Blockbuster Entertainment Corp.
$ 1,971,429 Revolving loan, maturing July 1, 2004 $ 1,689,790
Dreamworks Film Trust
2,000,000 Term loan, maturing December 31, 2006 2,000,000
Fitness Holdings Worldwide, Inc.
498,000 Term loan, maturing November 2, 2006 495,355
498,000 Term loan, maturing November 2, 2007 495,510
Interval International Corp.
1,006,529 Term loan, maturing December 16, 2005 1,003,384
1,006,529 Term loan, maturing December 15, 2006 1,003,384
Pebble Beach Company
1,538,406 Term loan, maturing July 30, 2006 1,544,896
SFX Entertainment, Inc
2,250,000 Term loan, maturing June 30, 2006 2,252,250
Six Flags Theme Parks Inc.
3,000,000 Term loan, maturing September 30, 2005 3,019,500
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$ 13,504,069
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Environmental Services -- 0.8%
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Allied Waste Industries, Inc.
$ 454,545 Term loan, maturing July 30, 2006 $ 427,139
545,455 Term loan, maturing July 30, 2007 512,567
Stericycle, Inc.
1,872,750 Term loan, maturing November 10, 2006 1,880,065
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$ 2,819,771
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Food, Beverages & Tobacco -- 4.6%
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Aurora Foods, Inc.
$ 990,013 Term loan, maturing September 30, 2006 $ 990,013
Del Monte Corporation
2,170,199 Term loan, maturing March 31, 2005 2,170,878
Domino's Inc.
968,003 Term loan, maturing December 21, 2006 971,996
969,521 Term loan, maturing December 21, 2007 973,561
Fleming Companies, Inc.
1,088,079 Term loan, maturing July 25, 2004 1,088,079
International Home Foods, Inc.
2,982,627 Term loan, maturing September 30, 2006 2,968,087
New World Pasta
882,167 Term loan, maturing January 28, 2006 876,102
Pabst Brewing Company
812,646 Term loan, maturing April 30, 2004 813,323
Sweeteners Holdings, Inc.
1,500,000 Term loan, maturing June 30, 2008 1,500,000
Tabletop Holdings, Inc.
997,500 Term loan, maturing March 31, 2007 997,500
Triarc Companies, Inc.
809,162 Term loan, maturing March 1, 2006 812,007
1,974,355 Term loan, maturing March 31, 2006 1,981,297
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$ 16,142,843
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Health Care - Equipment & Supplies -- 4.2%
-------------------------------------------------------------------------------
Charles River Laboratories, Inc.
$ 992,500 Term loan, maturing October 13, 2007 $ 992,500
Conmed Corporation
1,988,750 Term loan, maturing December 31, 2005 1,991,236
Dade Behring Holdings, Inc.
990,000 Term loan, maturing June 30, 2005 974,885
990,000 Term loan, maturing June 30, 2006 974,885
Fisher Scientific International Inc
1,467,083 Term loan, maturing January 21, 2007 1,469,719
1,010,643 Term loan, maturing January 21, 2008 1,012,933
Quest Diagnostics, Inc.
990,748 Term loan, maturing August 16, 2005 994,532
952,810 Term loan, maturing August 16, 2006 956,449
Stryker Corporation
875,354 Term loan, maturing December 10, 2005 878,910
2,538,599 Term loan, maturing December 10, 2006 2,548,913
WGL Acquisition Corp.
1,969,925 Term loan, maturing July 10, 2004 1,969,925
-------------------------------------------------------------------------------
$ 14,764,887
-------------------------------------------------------------------------------
Health Care - Providers & Services -- 2.3%
-------------------------------------------------------------------------------
FHC Health Systems, Inc.
$ 2,452,456 Term loan, maturing April 30, 2005 $ 2,452,456
2,452,456 Term loan, maturing April 30, 2006 2,452,456
Mariner Post-Acute Network (f/k/a Paragon)*
2,351,181 Term loan, maturing March 31, 2005 1,175,591
2,351,181 Term loan, maturing March 31, 2006 1,175,591
Team Health
956,667 Term loan, maturing March 12, 2006 956,667
-------------------------------------------------------------------------------
$ 8,212,761
-------------------------------------------------------------------------------
Hotels -- 1.7%
-------------------------------------------------------------------------------
Extended Stay America
$ 1,000,000 Term loan, maturing December 31, 2005 $ 1,000,000
Starwood Hotels & Resorts
3,000,000 Term loan, maturing February 23, 2003 3,010,314
Wyndham International, Inc.
1,000,000 Term loan, maturing June 30, 2004 987,153
1,000,000 Term loan, maturing June 30, 2006 1,000,000
-------------------------------------------------------------------------------
$ 5,997,467
-------------------------------------------------------------------------------
Household Furnish & Appliances -- 1.8%
-------------------------------------------------------------------------------
Home Interiors & Gifts, Inc.
$ 995,126 Term loan, maturing June 30, 2006 $ 995,126
Sealy Mattress Company
1,122,452 Term loan, maturing December 15, 2004 1,123,855
808,701 Term loan, maturing December 15, 2005 810,470
1,033,525 Term loan, maturing December 15, 2006 1,035,248
Simmons Company
713,697 Term loan, maturing October 30, 2005 715,481
1,785,714 Term loan, maturing October 30, 2006 1,790,179
-------------------------------------------------------------------------------
$ 6,470,359
-------------------------------------------------------------------------------
Household Products -- 2.8%
-------------------------------------------------------------------------------
Samsonite Corporation
$ 1,984,797 Term loan, maturing June 24, 2006 $ 1,970,739
The Imperial Decor Home Group, Inc.*
747,180 Revolving loan, maturing March 12, 2004 508,082
645,308 Term loan, maturing March 12, 2004 438,810
1,145,547 Term loan, maturing March 12, 2005 778,972
447,714 Term loan, maturing March 12, 2006 304,445
The Scotts Company
1,526,871 Term loan, maturing June 30, 2006 1,534,505
1,432,618 Term loan, maturing June 30, 2007 1,439,692
United Industries Corporation
982,500 Term loan, maturing January 20, 2006 982,500
Werner Holding Co.
1,964,736 Term loan, maturing November 30, 2004 1,959,745
-------------------------------------------------------------------------------
$ 9,917,490
-------------------------------------------------------------------------------
Insurance -- 2.0%
-------------------------------------------------------------------------------
Acordia, Inc.
$ 4,899,498 Term loan, maturing December 31, 2004 $ 4,899,498
Willis Corroon Corporation
970,000 Term loan, maturing February 19, 2007 968,383
485,000 Term loan, maturing February 19, 2008 484,192
485,000 Term loan, maturing August 19, 2008 484,192
-------------------------------------------------------------------------------
$ 6,836,265
-------------------------------------------------------------------------------
Machinery -- 1.9%
-------------------------------------------------------------------------------
Numatics, Incorporated
$ 2,884,257 Term loan, maturing September 19, 2005 $ 2,884,257
Terex Corporation
985,564 Term loan, maturing March 31, 2005 985,256
Thermadyne MFG LLC
1,435,818 Term loan, maturing May 22, 2005 1,435,818
1,435,818 Term loan, maturing May 22, 2006 1,435,818
-------------------------------------------------------------------------------
$ 6,741,149
-------------------------------------------------------------------------------
Manufacturing -- 6.3%
-------------------------------------------------------------------------------
Advanced Glassfiber Yarns LLC
$ 1,635,047 Term loan, maturing September 30, 2005 $ 1,635,047
Alliance Laundry Holdings LLC.
2,000,000 Term loan, maturing September 30, 2005 1,990,000
Citation Corporation
1,000,000 Term loan, maturing December 1, 2007 1,000,000
Dayton Superior Corporation
1,625,000 Term loan, maturing September 29, 2005 1,625,000
Mueller Group, Inc.
495,000 Term loan, maturing August 17, 2006 496,005
495,000 Term loan, maturing August 17, 2007 496,005
Neenah Foundry Company
2,991,276 Term loan, maturing September 30, 2005 2,991,276
Panolam Industries, Inc.
980,259 Term loan, maturing December 31, 2006 981,485
Polypore Incorporated
1,000,000 Term loan, maturing December 31, 2006 1,000,000
SPX Corporation
1,990,000 Term loan, maturing December 31, 2006 1,998,706
Synthetic Industries, Inc.
1,000,000 Term loan, maturing December 30, 2007 1,000,000
Tokheim Corporation
3,792,989 Term loan, maturing September 30, 2004 3,792,989
UCAR Finance, Inc.
2,990,000 Term loan, maturing December 31, 2007 2,997,548
-------------------------------------------------------------------------------
$ 22,004,061
-------------------------------------------------------------------------------
Metals & Mining -- 0.6%
-------------------------------------------------------------------------------
Handy & Harman
$ 985,904 Term loan, maturing July 30, 2006 $ 984,056
U.S. Silica Company
992,105 Term loan, maturing September 30, 2007 992,105
-------------------------------------------------------------------------------
$ 1,976,161
-------------------------------------------------------------------------------
Office Equipment & Supplies -- 1.6%
-------------------------------------------------------------------------------
Buhrmann, Inc.
$ 1,910,830 Term loan, maturing December 31, 2007 $ 1,915,607
U.S. Office Products
3,522,811 Term loan, maturing June 9, 2006 3,522,811
-------------------------------------------------------------------------------
$ 5,438,418
-------------------------------------------------------------------------------
Paper & Forest Products -- 0.9%
-------------------------------------------------------------------------------
Bear Island Paper Company, LLC
$ 1,321,079 Term loan, maturing December 31, 2005 $ 1,321,079
Pacifica Papers, Inc.
1,980,000 Term loan, maturing March 5, 2006 1,980,000
-------------------------------------------------------------------------------
$ 3,301,079
-------------------------------------------------------------------------------
Personal Products -- 0.6%
-------------------------------------------------------------------------------
American Safety Razor Compancy
$ 1,990,013 Term loan, maturing April 30, 2007 $ 1,983,368
-------------------------------------------------------------------------------
$ 1,983,368
-------------------------------------------------------------------------------
Pharmaceuticals & Biotechnology -- 1.7%
-------------------------------------------------------------------------------
Alliance Imaging, Inc.
$ 1,119,403 Term loan, maturing December 18, 2004 $ 1,109,608
1,380,597 Term loan, maturing December 18, 2005 1,368,517
Bergen Brunswig Corporation
2,496,250 Term loan, maturing October 19, 2001 2,496,250
Shire Pharmaceuticals
1,000,000 Term loan, maturing December 31, 2005 1,000,000
-------------------------------------------------------------------------------
$ 5,974,375
-------------------------------------------------------------------------------
Publishing & Printing -- 5.2%
-------------------------------------------------------------------------------
American Media Operations Inc.
$ 2,000,000 Term loan, maturing April 1, 2007 $ 2,003,750
Entertainment Publications, Inc.
784,279 Term loan, maturing December 31, 2005 784,279
HIF Corp.
2,000,000 Term loan, maturing December 31, 2004 2,000,000
Liberty Group Operating, Inc.
2,000,000 Term loan, maturing April 30, 2007 2,000,000
Merrill Corporation
995,000 Term loan, maturing November 15, 2007 995,000
Morris Communications Corporation
1,942,851 Term loan, maturing June 30, 2005 1,942,851
Primedia Inc.
2,487,500 Term loan, maturing June 30, 2004 2,478,172
Reiman Publications
1,991,896 Term loan, maturing November 30, 2005 1,999,779
The Sheridan Group, Inc.
990,652 Term loan, maturing January 30, 2005 990,652
Von Hoffman Press, Inc.
693,168 Term loan, maturing May 30, 2004 693,168
2,258,295 Term loan, maturing May 30, 2005 2,258,295
-------------------------------------------------------------------------------
$ 18,145,946
-------------------------------------------------------------------------------
Real Estate -- 2.4%
-------------------------------------------------------------------------------
American Tower, L.P.
$ 2,000,000 Term loan, maturing December 31, 2007 $ 2,007,126
Crown Castle Operating Company
2,000,000 Term loan, maturing March 31, 2008 2,005,358
Lennar Corporation
2,000,000 Term loan, maturing May 2, 2007 2,000,000
Spectrasite Communications, Inc.
1,000,000 Term loan, maturing June 30, 2006 1,002,250
Starwood Walden LLC
1,500,000 Term loan, maturing June 30, 2003 1,500,000
-------------------------------------------------------------------------------
$ 8,514,734
-------------------------------------------------------------------------------
REIT's -- 0.4%
-------------------------------------------------------------------------------
Crescent Real Estate Funding VIII
$ 1,467,754 Term loan, maturing May 30, 2008 $ 1,467,754
-------------------------------------------------------------------------------
$ 1,467,754
-------------------------------------------------------------------------------
Restaurants -- 1.0%
-------------------------------------------------------------------------------
Applebee's International, Inc.
$ 2,214,588 Term loan, maturing March 31, 2006 $ 2,214,588
Shoney's Inc.
1,243,832 Term loan, maturing April 30, 2002 1,243,832
-------------------------------------------------------------------------------
$ 3,458,420
-------------------------------------------------------------------------------
Retail - Food & Drug -- 2.8%
-------------------------------------------------------------------------------
Duane Reade Inc.
$ 1,989,886 Term loan, maturing February 15, 2006 $ 1,989,886
Pathmark Stores, Inc.
2,970,970 Term loan, maturing December 15, 2001 2,970,970
RiteAid Funding, LLC
3,000,000 Term loan, maturing August 1, 2002 3,000,000
Shoppers Acquisition Corporation
1,000,000 Term loan, maturing March 30, 2008 1,002,000
1,000,000 Term loan, maturing March 30, 2009 1,002,000
-------------------------------------------------------------------------------
$ 9,964,856
-------------------------------------------------------------------------------
Retail - Specialty -- 2.7%
-------------------------------------------------------------------------------
Advanced Stores Company, Inc.
$ 2,000,000 Term loan, maturing April 15, 2006 $ 2,000,000
Nebraska Book Company
2,441,860 Term loan, maturing March 31, 2006 2,441,860
Petro Shopping Centers, L.P.
2,000,000 Term loan, maturing July 31, 2006 2,000,000
Travelcenters of America, Inc.
2,966,877 Term loan, maturing March 27, 2005 2,976,148
-------------------------------------------------------------------------------
$ 9,418,008
-------------------------------------------------------------------------------
Road & Rail -- 1.4%
-------------------------------------------------------------------------------
Kansas City Southern Industries, Inc.
$ 2,000,000 Term loan, maturing December 29, 2006 $ 2,010,178
MTL
1,633,745 Term loan, maturing August 28, 2005 1,623,534
1,258,221 Term loan, maturing February 28, 2006 1,250,357
-------------------------------------------------------------------------------
$ 4,884,069
-------------------------------------------------------------------------------
Semiconductor Equipment & Products -- 0.4%
-------------------------------------------------------------------------------
Semiconductor Components Industries, LLC
$ 722,222 Term loan, maturing August 4, 2006 $ 728,090
777,778 Term loan, maturing August 4, 2007 784,097
-------------------------------------------------------------------------------
$ 1,512,187
-------------------------------------------------------------------------------
Telecommunications - Wireline -- 4.3%
-------------------------------------------------------------------------------
Alec Holdings, Inc.
$ 750,000 Term loan, maturing November 30, 2006 $ 750,391
750,000 Term loan, maturing November 30, 2007 750,547
Cincinnati Bell, Inc.
3,000,000 Term loan, maturing December 31, 2005 3,003,984
Davel Communications
2,468,750 Term loan, maturing June 23, 2005 1,975,000
Globenet Communication Holdings Ltd.
1,000,000 Term loan, maturing September 30, 2005 1,000,000
Level 3 Communications, Inc.
1,000,000 Term loan, maturing July 15, 2008 1,003,438
McLeod USA Incorporated
1,500,000 Term loan, maturing May 31, 2008 1,500,938
MJD Communications
2,977,157 Term loan, maturing March 31, 2006 2,977,157
Nextlink Communications, Inc.
2,000,000 Term loan, maturing June 30, 2007 2,011,072
-------------------------------------------------------------------------------
$ 14,972,527
-------------------------------------------------------------------------------
Telecommunications - Wireless -- 6.6%
-------------------------------------------------------------------------------
American Cellular Corporation
$ 700,000 Term loan, maturing March 31, 2007 $ 700,125
1,800,000 Term loan, maturing March 31, 2008 1,800,322
Centennial Cellular Corp.
1,218,825 Term loan, maturing November 30, 2006 1,222,223
1,218,813 Term loan, maturing November 30, 2007 1,222,563
Dobson Operating Company
1,990,000 Term loan, maturing December 31, 2007 1,990,249
Microcell Connexions
3,000,000 Term loan, maturing December 30, 2005 3,000,000
Nextel Communications, Inc.
750,000 Term loan, maturing June 30, 2008 753,469
750,000 Term loan, maturing December 30, 2008 753,469
1,000,000 Term loan, maturing March 31, 2009 992,727
Rural Cellular Corporation
1,000,000 Term loan, maturing April 6, 2008 999,000
1,000,000 Term loan, maturing April 6, 2009 999,000
Sygnet Operating Company (Dobson)
499,283 Term loan, maturing March 31, 2007 500,115
340,232 Term loan, maturing December 23, 2007 343,957
Tritel Holding Corp.
2,000,000 Term loan, maturing December 31, 2007 2,005,000
Voicestream Wireless Corp.
2,500,000 Term loan, maturing December 31, 2008 2,468,620
Western Wireless
2,500,000 Term loan, maturing September 30, 2008 2,496,095
Winstar Communications, Inc.
1,000,000 Term loan, maturing September 30, 2007 1,000,000
-------------------------------------------------------------------------------
$ 23,246,934
-------------------------------------------------------------------------------
Textiles & Apparel -- 2.4%
-------------------------------------------------------------------------------
Globe Manufacturing Corp
$ 3,880,500 Term loan, maturing July 31, 2006 $ 3,725,280
Joan Fabrics Corporation
1,390,921 Term loan, maturing June 30, 2005 1,383,966
2,080,357 Term loan, maturing June 30, 2006 2,069,956
The William Carter Company
989,362 Term loan, maturing October 31, 2003 988,949
-------------------------------------------------------------------------------
$ 8,168,151
-------------------------------------------------------------------------------
Theaters -- 2.0%
-------------------------------------------------------------------------------
Edwards Megaplex Holdings, LLC
$ 1,000,000 Term loan, maturing August 25, 2006 $ 1,000,000
Hollywood Theater Holdings, Inc.
987,500 Term loan, maturing March 31, 2006 987,500
Panavision International, L.P.
4,958,333 Term loan, maturing March 31, 2005 4,958,333
-------------------------------------------------------------------------------
$ 6,945,833
-------------------------------------------------------------------------------
Utilities -- 0.6%
-------------------------------------------------------------------------------
Western Resources Inc.
$ 2,000,000 Term loan, maturing March 17, 2003 $ 2,000,000
-------------------------------------------------------------------------------
$ 2,000,000
-------------------------------------------------------------------------------
Total Senior, Floating-Rate Loan Interests
(identified cost $409,839,888) $406,180,167
-------------------------------------------------------------------------------
Corporate Bonds & Notes -- 12.4%
-------------------------------------------------------------------------------
Apparel -- 0.3%
-------------------------------------------------------------------------------
William Carter Co., Sr. Sub. Notes
$ 1,000 10.375%, 12/1/06 $ 960,000
-------------------------------------------------------------------------------
$ 960,000
-------------------------------------------------------------------------------
Auto and Parts -- 0.2%
-------------------------------------------------------------------------------
J.L. French Automative Casting
$ 750 11.50%, 6/1/09 $ 686,250
-------------------------------------------------------------------------------
$ 686,250
-------------------------------------------------------------------------------
Broadcasting and Cable -- 1.8%
-------------------------------------------------------------------------------
EchoStar DBS Corp., Sr. Notes
$ 1,000 9.375%, 2/1/09 $ 965,000
Golden Sky Systems
1,000 12.375%, 8/1/06 1,095,000
NTL, Inc.
500 11.50%, 10/1/08 505,000
Pegasus Commerce
1,000 9.75%, 12/1/06 967,500
Telewest PLC
1,000 11.25%, 11/1/08 1,005,000
United Pan-Europe Communications NV, Sr. Notes
1,000 10.875%, 8/1/09 875,000
United Pan-Europe Communications, Sr. Notes 1/20/00
500 11.25%, 2/1/10 447,500
-------------------------------------------------------------------------------
$ 5,860,000
-------------------------------------------------------------------------------
Business Services -- 0.1%
-------------------------------------------------------------------------------
Federal Data Corp., Sr. Sub Notes
$ 750 10.125%, 8/1/05 $ 520,312
-------------------------------------------------------------------------------
$ 520,312
-------------------------------------------------------------------------------
Business Services - Miscellaneous -- 0.6%
-------------------------------------------------------------------------------
Anthony Crane Rentals, Sr. Notes
$ 500 10.375%, 8/1/08 $ 323,750
NationsRent, Inc., Sr. Sub. Notes
1,000 10.375%, 12/15/08 645,000
Neff Corp., Sr. Sub. Notes
1,000 10.25%, 6/1/08 625,000
Richmont Marketing Special, Sr. Sub Notes
1,000 10.125%, 12/15/07 505,000
-------------------------------------------------------------------------------
$ 2,098,750
-------------------------------------------------------------------------------
Chemicals -- 0.3%
-------------------------------------------------------------------------------
Georgia Gulf Corp.
$ 1,000 10.375%, 11/1/07 $ 1,045,000
-------------------------------------------------------------------------------
$ 1,045,000
-------------------------------------------------------------------------------
Communications Services -- 0.4%
-------------------------------------------------------------------------------
Covad Communication Group, Sr. Notes
$ 500 12.00%, 2/15/10(1) $ 392,500
Exodus Communications, Inc., Sr. Notes
1,000 11.625%, 7/15/10 1,000,000
-------------------------------------------------------------------------------
$ 1,392,500
-------------------------------------------------------------------------------
Consumer Manufacturing -- Non-durable -- 0.1%
-------------------------------------------------------------------------------
Viasystems, Inc., Sr. Sub. Notes
$ 600 9.75%, 6/1/07 $ 522,000
-------------------------------------------------------------------------------
$ 522,000
-------------------------------------------------------------------------------
Consumer Products -- 0.3%
-------------------------------------------------------------------------------
Glenoit Corp., Sr. Sub. Notes
$ 500 11.00%, 4/15/07 $ 77,500
Polaroid Corp.
750 11.50%, 2/15/06 783,750
-------------------------------------------------------------------------------
$ 861,250
-------------------------------------------------------------------------------
Containers and Packaging -- 0.4%
-------------------------------------------------------------------------------
Consumers International, Inc., Sr. Notes
$ 500 10.25%, 4/1/05 $ 252,500
Stone Container Corp., 1st Mtg. Notes
1,000 10.75%, 10/1/02 1,015,000
-------------------------------------------------------------------------------
$ 1,267,500
-------------------------------------------------------------------------------
Drugs -- 0.2%
-------------------------------------------------------------------------------
Warner Chilcott, Inc.
$ 750 12.625%, 2/15/08(1) $ 773,438
-------------------------------------------------------------------------------
$ 773,438
-------------------------------------------------------------------------------
Entertainment -- 0.3%
-------------------------------------------------------------------------------
Premier Parks, Inc.
$ 1,000 9.75%, 6/15/07 $ 971,250
-------------------------------------------------------------------------------
$ 971,250
-------------------------------------------------------------------------------
Foods -- 0.3%
-------------------------------------------------------------------------------
B & G Foods, Inc., Sub. Notes
$ 500 9.625%, 8/1/07 $ 352,500
Del Monte Corp., Sr. Notes
651 12.25%, 4/15/07 686,805
-------------------------------------------------------------------------------
$ 1,039,305
-------------------------------------------------------------------------------
Furniture and Appliances -- 0.1%
-------------------------------------------------------------------------------
Fedders North America
$ 500 9.375%, 8/15/07 $ 471,875
-------------------------------------------------------------------------------
$ 471,875
-------------------------------------------------------------------------------
Information Services -- 0.7%
-------------------------------------------------------------------------------
Psinet, Inc.
$ 1,250 11.50%, 11/1/08 $ 1,181,250
Verio, Inc., Sr. Notes
1,000 11.25%, 12/1/08 1,127,500
-------------------------------------------------------------------------------
$ 2,308,750
-------------------------------------------------------------------------------
Lodging and Gaming -- 1.3%
-------------------------------------------------------------------------------
Coast Hotels and Casino, Inc., Sr. Sub. Notes
$ 500 9.50%, 4/1/09 $ 477,500
Hollywood Casino, Sr. Sub. Notes
1,000 11.25%, 5/1/07 1,027,500
Majestic Star Casino, LLC
1,000 10.875%, 7/1/06 820,000
MGM Grand, Inc.
1,000 9.75%, 6/1/07 1,015,000
Sun International Hotels, Sr. Sub. Notes
1,000 9.00%, 3/15/07 940,000
-------------------------------------------------------------------------------
$ 4,280,000
-------------------------------------------------------------------------------
Manufacturing -- 0.3%
-------------------------------------------------------------------------------
Transdigm Inc.
$ 1,000 10.375%, 12/1/08 $ 865,000
-------------------------------------------------------------------------------
$ 865,000
-------------------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 0.1%
-------------------------------------------------------------------------------
R&B Falcon Corp.
$ 500 9.50%, 12/15/08 $ 505,000
-------------------------------------------------------------------------------
$ 505,000
-------------------------------------------------------------------------------
Oil and Gas - Exploration and Production -- 0.3%
-------------------------------------------------------------------------------
Western Natural Gas
$ 1,000 10.00%, 6/15/09 $ 1,037,500
-------------------------------------------------------------------------------
$ 1,037,500
-------------------------------------------------------------------------------
Printing and Business Products -- 0.3%
-------------------------------------------------------------------------------
MDC Communications Corp., Sr. Sub. Notes
$ 1,250 10.50%, 12/1/06 $ 1,200,000
-------------------------------------------------------------------------------
$ 1,200,000
-------------------------------------------------------------------------------
Publishing -- 0.5%
-------------------------------------------------------------------------------
American Lawyer Media
$ 1,000 9.75%, 12/15/07 $ 917,500
Von Hoffman Press, Inc., Sr. Sub. Notes
750 10.875%, 5/15/07(1) 709,688
-------------------------------------------------------------------------------
$ 1,627,188
-------------------------------------------------------------------------------
Restaurants -- 0.1%
-------------------------------------------------------------------------------
AFC Enterprises, Inc., Sr. Sub Notes
$ 550 10.25%, 5/15/07 $ 536,250
-------------------------------------------------------------------------------
$ 536,250
-------------------------------------------------------------------------------
Retail - Food and Drug -- 0.3%
-------------------------------------------------------------------------------
Pantry, Inc., Sr. Sub. Notes
$ 1,000 10.25%, 10/15/07 $ 950,000
-------------------------------------------------------------------------------
$ 950,000
-------------------------------------------------------------------------------
Retail - General -- 0.3%
-------------------------------------------------------------------------------
Advance Stores Co., Inc., Sr. Sub. Notes
$ 750 10.25%, 4/15/08 $ 622,500
Kindercare Learning Ctrs., Inc., Sr. Sub. Notes
1,000 9.50%, 2/15/09 925,000
-------------------------------------------------------------------------------
$ 1,547,500
-------------------------------------------------------------------------------
Transportation -- 0.2%
-------------------------------------------------------------------------------
Pacer International, Inc.
$ 750 11.75%, 6/1/07 $ 751,875
-------------------------------------------------------------------------------
$ 751,875
-------------------------------------------------------------------------------
Wireless Communication Services - 0.2%
-------------------------------------------------------------------------------
Dobson/Signet Communications Corp.
$ 625 12.25%, 12/15/08 $ 668,750
-------------------------------------------------------------------------------
$ 668,750
-------------------------------------------------------------------------------
Wireline Communication Services -
International -- 1.1%
-------------------------------------------------------------------------------
Esprit Telecom Group PLC, Sr. Notes
$ 1,000 11.50%, 12/15/07 $ 715,000
Primus Telecom Group, Sr. Notes
1,000 11.25%, 1/15/09 805,000
Versatel Telecom BV, Sr. Notes
1,500 11.875%, 7/15/09 1,485,000
Viatel, Inc., Sr. Notes
1,000 11.50%, 3/15/09 750,000
-------------------------------------------------------------------------------
$ 3,755,000
-------------------------------------------------------------------------------
Wireline Communication Services -
North America -- 1.3%
-------------------------------------------------------------------------------
Hyperion Telecommunications, Inc., Sr. Notes
$ 1,000 12.25%, 9/1/04 $ 1,020,000
Level 3 Communications, Inc., St. Notes
1,000 9.125%, 5/1/08 902,500
Metromedia Fiber Network, Sr. Notes
500 10.00%, 11/15/08 495,000
500 10.00%, 12/15/09 495,000
Nextlink Communications, Sr. Notes
750 10.50%, 12/1/09(1) 735,000
Williams Communications Group, Inc., Sr. Notes
1,000 10.875%, 10/1/09 982,500
-------------------------------------------------------------------------------
$ 4,630,000
-------------------------------------------------------------------------------
Total Corporate Bonds & Notes
(identified cost $47,042,668) $ 43,132,243
-------------------------------------------------------------------------------
Common Stocks and Warrants -- 1.2%
Shares/
Warrants Security Value
-------------------------------------------------------------------------------
Manufacturing -- 0.0%
-------------------------------------------------------------------------------
26,103 Tokheim Warrants* $ --
-------------------------------------------------------------------------------
$ --
-------------------------------------------------------------------------------
Investment Companies -- 1.2%
-------------------------------------------------------------------------------
500,000 VanKampen Senior Income Trust $ 4,218,750
-------------------------------------------------------------------------------
$ 4,218,750
-------------------------------------------------------------------------------
Total Common Stocks and Warrants
(identified cost, $4,116,650) $ 4,218,750
-------------------------------------------------------------------------------
Commercial Paper -- 5.3%
Principal Maturity
Amount Date Security Rate Value
-------------------------------------------------------------------------------
$ 8,102,000 Associates Corp.
of North America 6.89% 7/3/00 $ 8,098,899
10,611,000 CIT Group Holdings 6.77% 7/6/00 10,601,023
-------------------------------------------------------------------------------
Total Commercial Paper
(amortized cost, $18,699,922) $ 18,699,922
-------------------------------------------------------------------------------
Total Investments -- 135.0%
(identified cost, $479,699,128) $472,231,082
-------------------------------------------------------------------------------
Other Assets, Less Liabilities -- (35.0%) $122,428,459
-------------------------------------------------------------------------------
Net Assets -- 100% $349,802,623
-------------------------------------------------------------------------------
(1) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
(2) Senior secured floating rate interests often require prepayments from excess
cash flows or permit the borrower to repay at its election. The degree to
which borrowers repay, whether as a contractual requirement or at the
election, cannot be predicted with accuracy. As a result, the actual
remaining maturity may be substantially less than the stated maturities
shown. However, it is anticipated that the senior secured floating rate
interests will have an expected average life of approximately three years.
* Non-income producing.
Note: At June 30, 2000, the Trust had unfunded commitments amounting to
$1,028,571 under various revolving credit agreements.
See notes to financial statements
<PAGE>
<TABLE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
---------------------------------------------------------------------------------------
FINANCIAL STATEMENTS
---------------------------------------------------------------------------------------
Statement of Assets and Liabilities
As of June 30, 2000
Assets
---------------------------------------------------------------------------------------
<S> <C>
Investments, at value
(identified cost, $479,699,128) $472,231,082
Cash 5,864,812
Receivable for investments sold 1,060,083
Dividends and interest receivable 4,634,279
Prepaid expenses 49,447
---------------------------------------------------------------------------------------
Total assets $483,839,703
---------------------------------------------------------------------------------------
Liabilities
---------------------------------------------------------------------------------------
Amounts due under commercial paper program $129,000,000
Payable for investments purchased 2,575,625
Deferred facility fee income 1,306,457
Miscellaneous liabilities 140,816
Dividends payable 112,640
Payable to affiliate for Trustees' fees 6,577
Accrued expenses:
Interest 707,368
Operating expense 187,597
---------------------------------------------------------------------------------------
Total liabilities $134,037,080
---------------------------------------------------------------------------------------
Net Assets for 35,660,000 shares of beneficial interest outstanding $349,802,623
---------------------------------------------------------------------------------------
Sources of Net Assets
---------------------------------------------------------------------------------------
Paid-in capital $355,878,889
Accumulated distributions in excess of net realized gain
(computed on the basis of identified cost) (1,364,471)
Accumulated undistributed net investment income 2,756,251
Net unrealized depreciation
(computed on the basis of identified cost) (7,468,046)
---------------------------------------------------------------------------------------
Total $349,802,623
---------------------------------------------------------------------------------------
Net Asset Value
---------------------------------------------------------------------------------------
($349,802,623 / 35,660,000 shares of
beneficial interest outstanding) $ 9.81
---------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
Statement of Operations
For the Year Ended
June 30, 2000
Investment Income
--------------------------------------------------------------------------------------
<S> <C>
Interest $44,671,424
Dividends 105,000
Facility fees earned 1,164,037
Miscellaneous 79,703
--------------------------------------------------------------------------------------
Total investment income $46,020,164
--------------------------------------------------------------------------------------
Expenses
--------------------------------------------------------------------------------------
Investment adviser fee $ 4,236,411
Administration fee 1,246,003
Trustees fees and expenses 8,112
Interest 8,543,089
Custodian fee 192,519
Legal and accounting services 144,190
Transfer and dividend disbursing agent fees 117,962
Loan program structuring expense 91,447
Printing and postage 46,514
Registration fees 28,264
Miscellaneous 409,180
--------------------------------------------------------------------------------------
Total expenses $15,063,691
--------------------------------------------------------------------------------------
Net investment income $30,956,473
--------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
--------------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $(1,240,715)
--------------------------------------------------------------------------------------
Net realized loss $(1,240,715)
--------------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $(8,344,561)
--------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) $(8,344,561)
--------------------------------------------------------------------------------------
Net realized and unrealized loss $(9,585,276)
--------------------------------------------------------------------------------------
Net increase in net assets from operations $21,371,197
--------------------------------------------------------------------------------------
See notes to financial statements
</TABLE>
<PAGE>
<TABLE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
---------------------------------------------------------------------------------------------
FINANCIAL STATEMENTS CONT'D
---------------------------------------------------------------------------------------------
Statements of Changes in Net Assets
<CAPTION>
Increase (Decrease) Year Ended Period Ended
in Net Assets June 30, 2000 June 30, 1999(1)
---------------------------------------------------------------------------------------------
<S> <C> <C>
From operations --
Net investment income $ 30,956,473 $ 19,224,711
Net realized gain (loss) (1,240,715) 298,920
Net change in unrealized appreciation
(depreciation) (8,344,561) 876,515
---------------------------------------------------------------------------------------------
Net increase in net assets from operations $ 21,371,197 $ 20,400,146
---------------------------------------------------------------------------------------------
Distributions to shareholders --
From net investment income $(30,851,144) $(16,581,900)
In excess of net realized gains (422,676) --
---------------------------------------------------------------------------------------------
Total distributions to shareholders $(31,273,820) $(16,581,900)
---------------------------------------------------------------------------------------------
Transactions in shares of beneficial interest --
Proceeds from sale of shares $ -- $356,500,000
Cost of shares redeemed -- (713,000)
---------------------------------------------------------------------------------------------
Net increase in net assets from
Fund share transactions $ -- $355,787,000
---------------------------------------------------------------------------------------------
Net increase (decrease) in net assets $ (9,902,623) $359,605,246
---------------------------------------------------------------------------------------------
Net Assets
---------------------------------------------------------------------------------------------
At beginning of year $359,705,246 $ 100,000
---------------------------------------------------------------------------------------------
At end of year $349,802,623 $359,705,246
---------------------------------------------------------------------------------------------
Accumulated undistributed
net investment income
included in net assets
---------------------------------------------------------------------------------------------
At end of year $ 2,756,251 $ 2,650,922
---------------------------------------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to June 30, 1999.
</TABLE>
<PAGE>
<TABLE>
Statement of Cash Flows
<CAPTION>
Year Ended
Increase (Decrease) in Cash June 30, 2000
-----------------------------------------------------------------------------------
<S> <C>
Cash Flows From (Used For) Operating Activities --
Purchases of loan interests and corporate bonds $(267,523,670)
Proceeds from principal repayments and sales 298,535,711
Interest and dividends received 43,877,222
Facility fees received 119,703
Miscellaneous income received 220,519
Interest paid (8,441,345)
Operating expenses paid (6,528,215)
Net increase in short-term investments (13,616,922)
-----------------------------------------------------------------------------------
Net cash from operating activities $ 46,643,003
-----------------------------------------------------------------------------------
Cash Flows From (Used For) Financing Activities --
Cash distributions paid (31,414,321)
Net decrease in amounts due under commercial paper program (23,000,000)
-----------------------------------------------------------------------------------
Net cash used for financing activities $ (54,414,321)
-----------------------------------------------------------------------------------
Net decrease in cash $ (7,771,318)
-----------------------------------------------------------------------------------
Cash at beginning of year $ 13,636,130
-----------------------------------------------------------------------------------
Cash at end of year $ 5,864,812
-----------------------------------------------------------------------------------
Reconciliation of Net Decrease in Net Assets
From Operations to Net Cash
From Operating Activities
-----------------------------------------------------------------------------------
Net increase in net assets from operations $ 21,371,197
Decrease in receivable for investments sold 25,037
Increase in dividends and interest receivable (794,202)
Increase in prepaid expenses (15,795)
Decrease in deferred facility fee income (1,704,641)
Increase in miscellaneous liability 140,816
Decrease in payable to affiliate (1,753)
Increase in accrued expenses 111,679
Increase payable for investments purchased 2,575,625
Net decrease in investments 24,935,040
-----------------------------------------------------------------------------------
Net cash from operating activities $ 46,643,003
-----------------------------------------------------------------------------------
See notes to financial statements
</TABLE>
<PAGE>
<TABLE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
---------------------------------------------------------------------------------------------
FINANCIAL STATEMENTS CONT'D
---------------------------------------------------------------------------------------------
Financial Highlights
<CAPTION>
Year Ended June 30,
2000 1999(1)(2)
-----------------------------------------------------------------------------------------------
<S> <C> <C>
Net asset value -- Beginning of year $ 10.090 $ 10.000
-----------------------------------------------------------------------------------------------
Income (loss) from operations
-----------------------------------------------------------------------------------------------
Net investment income $ 0.868 $ 0.539
Net realized and unrealized gain (loss) (0.271) 0.036
-----------------------------------------------------------------------------------------------
Total income from operations $ 0.597 $ 0.575
-----------------------------------------------------------------------------------------------
Less distributions
-----------------------------------------------------------------------------------------------
From net investment income $ (0.865) $ (0.465)
In excess of net realized gain (0.012) $ --
-----------------------------------------------------------------------------------------------
Total distributions $ (0.877) $ (0.465)
-----------------------------------------------------------------------------------------------
Offering costs charged to paid-in capital $ -- $ (0.020)
-----------------------------------------------------------------------------------------------
Net asset value -- End of year $ 9.810 $ 10.090
-----------------------------------------------------------------------------------------------
Market value -- End of year $ 9.313 $ 10.000
-----------------------------------------------------------------------------------------------
Total Return(3) 2.00% 4.93%
-----------------------------------------------------------------------------------------------
Ratios/Supplemental Data+
-----------------------------------------------------------------------------------------------
Net assets, end of year (000's omitted) $349,803 $359,705
Ratios (As a percentage of average daily net assets):
Operating expenses 1.84% 1.65%(4)
Interest expense 2.41% 2.02%(4)
Total expense 4.25% 3.67%
Net investment income 8.73% 8.17%(4)
Portfolio Turnover 63% 27%
-----------------------------------------------------------------------------------------------
+ The operating expenses of the Trust may reflect a reduction of the investment adviser fee and
the administation fee. Had such actions not been taken, the ratios and net investment income
per share would have been as follows:
Ratios (As a percentage of average daily net assets):
Net operating expenses 1.97%(4)
Interest expense 2.02%(4)
Net investment income 7.85%(4)
Net investment income per share $ 0.518
-----------------------------------------------------------------------------------------------
(1) Net investment income per share was computed using average shares outstanding.
(2) For the period from the start of business, October 30, 1998, to June 30, 1999.
(3) Total return is calculated assuming a purchase at market value on the first day and a sale
at the market value on the last day of the period reported. Dividends and distributions, if
any, are assumed reinvested on the reinvestment date. Total return is not computed on an
annualized basis.
(4) Annualized.
See notes to financial statements
</TABLE>
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
1 Significant Accounting Policies
--------------------------------------------------------------------------------
Eaton Vance Senior Income Trust (the Trust) is an entity commonly known as a
Massachusetts business trust and is registered under the Investment Company
Act of 1940 as a non-diversified closed-end management investment company.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with accounting principles generally accepted in
the United States of America.
A Investment Valuation -- The Trust's investments are primarily in interests
in senior floating-rate loans (Senior Loans). Certain Senior Loans are
deemed liquid because reliable market quotations are readily available for
them. Eaton Vance Management (EVM) values liquid loans at their market
value, so that they are marked-to-market daily. Other Senior Loans are
valued at fair value by the Trust's investment adviser, Eaton Vance
Management (EVM), under procedures established by the Trustees as permitted
by Section 2(a)(41) of the Investment Company Act of 1940. Such procedures
include the consideration of relevant factors, data and information relating
to fair value, including (i) the characteristics of and fundamental
analytical data relating to the Senior Loan, including the cost, size,
current interest rate, period until next interest rate reset, maturity and
base lending rate of the Senior Loan, the terms and conditions of the Senior
Loan and any related agreements and the position of the loan in the
borrower's debt structure; (ii) the nature, adequacy and value of the
collateral, including the Trust's rights, remedies and interests with
respect to the collateral; (iii) the creditworthiness of the Borrower, based
on evaluations of its financial condition, financial statements and
information about the Borrower's business, cash flows, capital structure and
future prospects; (iv) information relating to the market for the Senior
Loan including price quotations for and trading in the Senior Loan and
interests in similar loans and the market environment and investor attitudes
towards the Senior Loan and interests in similar loans; (v) the reputation
and financial condition of the agent and any intermediate participant in the
loan; and (vi) general economic and market conditions affecting the fair
value of the Senior Loan. Other portfolio securities (other than short-term
obligations, but including listed issues) may be valued on the basis of
prices furnished by one or more pricing services which determine prices for
normal, institutional-size trading units of such securities which may use
market information, transactions for comparable securities and various
relationships between securities which are generally recognized by
institutional traders. In certain circumstances, portfolio securities will
be valued at the last sales price on the exchange that is the primary market
for such securities, or the last quoted bid price for those securities for
which the over-the-counter market is the primary market or for listed
securities in which there were no sales during the day. The value of
interest rate swaps will be determined in accordance with a discounted
present value formula and then confirmed by obtaining a bank quotation.
Short-term obligations which mature in sixty days or less are valued at
amortized cost, if their original term to maturity when acquired by the
Trust was 60 days or less or are valued at amortized cost using their value
on the 61st day prior to maturity, if their original term to maturity when
acquired by the Trust was more then 60 days, unless in each case this is
determined not to represent fair value. Repurchase agreements are valued at
cost plus accrued interest. Other portfolio securities for which there are
no quotations or valuations are valued at fair value as determined in good
faith by or on behalf of the Trustees.
B Income -- Interest income from Senior Loans is recorded on the accrual
basis at the then-current interest rate, while all other interest income is
determined on the basis of interest accrued, adjusted for amortization of
premium or discount when required for federal income tax purposes. Facility
fees received are recognized as income over the expected term of the loan.
C Federal Taxes -- The Trust's policy is to comply with the provisions of
the Internal Revenue Code applicable to regulated investment companies and
to distribute to shareholders each year all of its taxable income, including
any net realized gain on investments. Accordingly, no provision for federal
income or excise tax is necessary.
D Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian of the Trust. Pursuant to the custodian agreement, IBT receives a
fee reduced by credits which are determined based on the average daily cash
balances the Trust maintains with IBT. All significant credit balances used
to reduce the Trust's custodian fees are reported as a reduction of expenses
on the Statement of Operations.
E Use of Estimates -- 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 income and expense during the reporting period. Actual results could
differ from those estimates.
F Offering Costs -- Costs incurred by the Trust in connection with the
initial offering of Trust shares were recorded as a reduction of paid-in
capital.
G Other -- Investment transactions are accounted for on the date the
investments are purchased or sold. Gains and losses on securities sold are
determined on the basis of identified cost.
2 Distributions to Shareholders
--------------------------------------------------------------------------------
Distributions to shareholders are recorded on the ex-dividend date. The
Trust distinguishes between distributions on a tax basis and a financial
reporting basis. Generally accepted accounting principles require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a tax return of capital. Differences in the
recognition or classification of income between the financial statements and
tax earnings and profits which result in temporary over-distributions for
financial statement purposes are classified as distributions in excess of
net investment income or accumulated net realized gains. Permanent
differences between book and tax accounting relating to distributions are
reclassified to paid-in capital.
3 Shares of Beneficial Interest
--------------------------------------------------------------------------------
The agreement and Declaration of Trust permits the Trustees to issue an
unlimited number of full and fractional $0.01 par value shares of beneficial
interest. Transactions in Trust shares were as follows:
Year Ended June 30,
2000 1999(1)
------------------------------------------------------------
Sales -- 35,660,000
--------------------------------------------------------------
Net increase -- 35,660,000
(1) For the period from the start of business, October 30, 1998, to June
30, 1999.
4 Investment Adviser Fee and Other Transactions with Affiliates
------------------------------------------------------------------
The investment adviser fee, computed at a monthly rate of 17/240 of 1%
(0.85% annually) of the Trust's average weekly gross assets, was earned by
EVM as compensation for management and investment advisory services rendered
to the Trust. For the year ended June 30, 2000, the fee was equivalent to
0.85% of the Trust's average daily gross assets and amounted to $4,236,411.
Except for Trustees of the Trust who are not members of EVM's organization,
officers and Trustees receive remuneration for their services to the Trust
out of such investment adviser fee. EVM also serves as the administrator of
the Trust. An administration fee, computed at the monthly rate of 1/48 of 1%
(0.25% annually) of the average weekly gross assets of the Trust, is paid to
EVM for managing and administering business affairs of the Trust. For the year
ended June 30, 2000, the fee was equivalent to 0.25% of the Trust's average
daily gross assets for such period and amounted to $1,246,003.
Certain officers and Trustees of the Trust are officers of the above
organization.
During the year ended June 30, 2000, the Trust engaged in purchase and sales
transactions with other Funds that also utilize EVM, or an affiliate of EVM,
as an investment adviser. These purchase and sales transactions complied
with Rule 17a-7 under the Investment Company Act of 1940 and amounted to
$16,372,547.
5 Investment Transactions
--------------------------------------------------------------------------------
The Trust invests primarily in Senior Loans. The ability of the issuers of
the Senior Loans held by the Trust to meet their obligations may be affected
by economic developments in a specific industry. The cost of purchases and
the proceeds from principal repayments and sales of Senior Loans and
corporate bonds aggregated $270,099,295 and $298,510,674, respectively, for
the year ended June 30, 2000.
6 Short-Term Debt and Credit Agreements
--------------------------------------------------------------------------------
The Trust has entered into a revolving credit agreement that will allow the
Trust to borrow $178 million to support the issuance of commercial paper and
to permit the Trust to invest in accordance with its investment practices.
Interest is charged under the revolving credit agreement at the bank's base
rate or at an amount above either the bank's adjusted certificate of deposit
rate or federal funds effective rate. Interest expense includes a commitment
fee of approximately $249,000 which is computed at the annual rate of 0.15%
on the unused portion of the revolving credit agreement. There were no
borrowings under this agreement during the period. As of June 30, 2000, the
Trust had commercial paper outstanding of $129,000,000, at an interest rate
of 6.58%. Maximum and average borrowings for the year ended June 30, 2000
were $162,000,000 and $140,000,000, respectively, and the average interest
rate was 6.05%.
7 Federal Income Tax Basis of Investments
--------------------------------------------------------------------------------
The cost and unrealized appreciation/depreciation in value of the investment
securities at June 30, 2000, as computed on a federal income tax basis, were
as follows:
Aggregate cost $479,699,128
---------------------------------------------------------------------------
Gross unrealized appreciation $ 1,298,376
Gross unrealized depreciation (8,766,422)
---------------------------------------------------------------------------
Net unrealized depreciation $ (7,468,046)
---------------------------------------------------------------------------
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
--------------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
--------------------------------------------------------------------------------
To the Trustees and Shareholders
of Eaton Vance Senior Income Trust
--------------------------------------------------------------------------------
We have audited the accompanying statement of assets and liabilities,
including the portfolio of investments, of Eaton Vance Senior Income Trust
(the Trust) as of June 30, 2000, and the related statement of operations and
cash flows for the year then ended, and the statement of changes in net assets
and the financial highlights for the year ended June 30, 2000 and for the
period from the start of business, October 30, 1998, to June 30, 1999. These
financial statements and financial highlights are the responsibility of the
Trust'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 auditing standards generally
accepted in the United States of America. 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. Our procedures included confirmation of securities and Senior
Loans owned at June 30, 2000 by correspondence with the custodian, brokers and
selling or agent banks; where replies were not received from brokers and
selling or agent banks, we performed other auditing procedures. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. 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, such financial statements and financial highlights, referred
to above, present fairly, in all material respects, the financial position of
Eaton Vance Senior Income Trust at June 30, 2000, the results of its
operations, the changes in its net assets, its cash flows and its financial
highlights for the respective stated periods in conformity with accounting
principles generally accepted in the United States of America.
As discussed in Note 1A, the financial statements include Senior Loans and
certain other securities held by the Trust valued at $224,666,768 (64% of net
assets of the Trust), which values are fair values determined by the Trust's
investment adviser in the absence of actual market values. Determination of
fair value involves subjective judgment, as the actual market value of a
particular Senior Loan or security can be established only by negotiations
between the parties in a sale transaction. We have reviewed the procedures
established by the Trustees and used by the Trust's investment adviser in
determining the fair values of such Senior Loans and securities and have
inspected underlying documentation, and under the circumstances, we believe
that the procedures are reasonable and the documentation appropriate.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
August 11, 2000
<PAGE>
EATON VANCE SENIOR INCOME TRUST
--------------------------------------------------------------------------------
DIVIDEND REINVESTMENT PLAN
--------------------------------------------------------------------------------
The Trust offers a dividend reinvestment plan (the Plan) pursuant to which
shareholders automatically have dividends and capital gains distributions
reinvested in common shares (the Shares) of the Trust unless they elect
otherwise through their investment dealer. On the distribution payment date,
if the net asset value per Share is equal to or less than the market price per
Share plus estimated brokerage commissions then new Shares will be issued. The
number of Shares shall be determined by the greater of the net asset value per
Share or 95% of the market price. Otherwise, Shares generally will be
purchased on the open market by the Plan Agent. Distributions subject to
income tax (if any) are taxable whether or not shares are reinvested.
If your shares are in the name of a brokerage firm, bank, or other nominee,
you can ask the firm or nominee to participate in the Plan on your behalf. If
the nominee does not offer the Plan, you will need to request that your shares
be re-registered in your name with the Trust's transfer agent, PFPC Global
Fund Services or you will not be able to participate.
The Plan Agent's service fee for handling distributions will be paid by the
Trust. Each participant will be charged their pro rata share of brokerage
commissions on all open-market purchases.
Plan participants may withdraw from the Plan at any time by writing to the
Plan Agent at the address noted on the following page. If you withdraw, you
will receive shares in your name for all Shares credited to your account under
the Plan. If a participant elects by written notice to the Plan Agent to have
the Plan Agent sell part or all of his or her Shares and remit the proceeds,
the Plan Agent is authorized to deduct a $5.00 fee plus brokerage commissions
from the proceeds.
If you wish to paticipate in the Plan and your shares are held in your own
name, you may complete the form on the following page and deliver it to the
Plan Agent.
Any inquiries regarding the Plan can be directed to the Plan Agent, PFPC Global
Fund Services, at 1-800-331-1710.
<PAGE>
EATON VANCE SENIOR INCOME TRUST
APPLICATION FOR PARTICIPATION IN
DIVIDEND REINVESTMENT PLAN
------------------------------------------------------------------------------
This form is for shareholders who hold their common shares in their own
names. If your common shares are held in the name of a brokerage firm, bank,
or other nominee, you should contact your nominee to see if it will
participate in the Plan on your behalf. If you wish to participate in the
Plan, but your brokerage firm, bank, or nominee is unable to participate on
your behalf, you should request that your common shares be re-registered in
your own name which will enable your participation in the Plan.
------------------------------------------------------------------------------
The following authorization and appointment is given with the understanding that
I may terminate it at any time by terminating my participation in the Plan as
provided in the terms and conditions of the Plan.
--------------------------------------
Please print exact name on account:
--------------------------------------
Shareholder signature Date
--------------------------------------
Shareholder signature Date
Please sign exactly as your common
shares are registered. All persons
whose names appear on the share
certificate must sign.
YOU SHOULD NOT RETURN THIS FORM IF YOU WISH TO RECEIVE YOUR DIVIDENDS AND
DISTRIBUTIONS IN CASH. THIS IS NOT A PROXY.
THE AUTHORIZATION FORM, WHEN SIGNED, SHOULD BE MAILED TO THE FOLLOWING
ADDRESS:
Eaton Vance Senior Income Trust
c/o PFPC Global Fund Services
P.O. Box 8030
Boston, MA 02266-8030
800-331-1710
--------------------------------------------------------------------------------
NUMBER OF EMPLOYEES
The Trust is organized as a Massachusetts business trust and is registered
under the Investment Company Act of 1940, as amended, as a closed-end,
nondiversified, management investment company and has no employees.
NUMBER OF SHAREHOLDERS
As of June 30, 2000, Trust records indicate that there were 339 registered
shareholders for and approximately 15,700 shareholders owning Trust shares in
street name, such as through brokers, banks, and other financial
intermediaries.
If you are a street name shareholder and wish to receive our reports directly,
which contain important information about the Trust, please write or call:
Eaton Vance Distributors, Inc.
The Eaton Vance Building
255 State Street
Boston, MA 02109
1-800-225-6265
NEW YORK STOCK EXHANGE SYMBOL
Eaton Vance Senior Income Trust EFP
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 2000
--------------------------------------------------------------------------------
INVESTMENT MANAGEMENT
--------------------------------------------------------------------------------
Eaton Vance Senior Income Trust
Officers Trustees
JAMES B. HAWKES JESSICA M. BIBLIOWICZ
President, Chief Executive President and Chief Executive Officer,
Officer and Trustee National Financial Partners
SCOTT H. PAGE DONALD R. DWIGHT
Vice President and President, Dwight Partners, Inc.
Co-Portfolio Manager
SAMUEL L. HAYES, III
PAYSON F. SWAFFIELD Jacob H. Schiff Professor of Investment
Vice President and Banking Emeritus, Harvard University
Co-Portfolio Manager Graduate School of Business Administration
MICHAEL W. WEILHEIMER NORTON H. REAMER
Vice President Chairman of the Board,
United Asset Management Corporation
JAMES L. O'CONNOR LYNN A. STOUT
Treasurer Professor of Law
Georgetown University Law Center
ALAN R. DYNNER JACK L. TREYNOR
Secretary Investment Adviser and Consultant
<PAGE>
INVESTMENT ADVISER AND ADMINISTRATOR OF
EATON VANCE SENIOR INCOME TRUST
EATON VANCE MANAGEMENT
The Eaton Vance Building
255 State Street
Boston, MA 02109
CUSTODIAN
INVESTORS BANK & TRUST COMPANY
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT
PFPC, INC.
Attn: Eaton Vance Senior Income Trust
P.O. Box 8030
Boston, MA 02266-8030
(800) 331-1710
INDEPENDENT AUDITORS
DELOITTE & TOUCHE LLP
200 Berkeley Street
Boston, MA 02116-5022
Eaton Vance Senior Income Trust
The Eaton Vance Building
255 State Street
Boston, MA 02109
171-8/00 SITSRC
