<PAGE> 1
MOSHER, INC.
AIM MUNICIPAL BOND FUND
A Portfolio of AIM Funds Group
SUPPLEMENT
Dated July 15, 1997
to
COMBINED PROXY STATEMENT AND PROSPECTUS
Dated June 23, 1997
The following information is substituted for the discussion appearing
under the heading "Synopsis - Performance" appearing on page 4 of the Combined
Proxy Statement and Prospectus.
Performance
Set forth below are average annual total returns for the periods
indicated for each of AIM Municipal Bond and Mosher. Average annual total return
figures for AIM Municipal Bond are shown taking into account sales charges paid
by an investor and without taking such sales charges into account. Mosher
shareholders will not pay any sales charges in connection with the Transaction.
Mosher shares are not subject to sales charges since Mosher is a closed-end
investment company that does not continuously offer its shares for sale to the
public.
<TABLE>
<CAPTION>
AIM Municipal Bond AIM Municipal Bond Mosher
-------------------- ----------------------- ------
(with sales charges) (without sales charges)
<S> <C> <C> <C>
1 Year Ended December 31, 1996 (1.04%) 3.90% 4.59%
5 Years Ended December 31, 1996 5.57% 6.60% 6.94%
</TABLE>
The annual operating expenses as a percentage of net assets (the
"Expense Ratio") for the Class A shares of AIM Municipal Bond was higher than
the Expense Ratio for Mosher for the years ended December 31, 1996. See
"Synopsis - Expense Levels." The higher Expense Ratio reduces the yield to AIM
Municipal Bond shares.
