<PAGE> 1
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
<TABLE>
<CAPTION>
AIM FUNDS GROUP
- -------------------------------------------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -------------------------------------------------------------------------------------------------------------------
<S> <C>
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- -------------------------------------------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- -------------------------------------------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was
determined):
- -------------------------------------------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- -------------------------------------------------------------------------------------------------------------------
(5) Total fee paid:
- -------------------------------------------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- -------------------------------------------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- -------------------------------------------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- -------------------------------------------------------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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</TABLE>
<PAGE> 2
AIM MONEY MARKET FUND
11 GREENWAY PLAZA, SUITE 100
HOUSTON, TEXAS 77046
October __, 1998
Dear Shareholder,
The attached proxy statement solicits your vote as a holder of Class A
Shares of AIM Money Market Fund (Fund) on an important proposal being
recommended by the Board of Trustees. The Fund has scheduled a special meeting
of the holders of Class A Shares of the Fund for December 11, 1998. At the
special meeting, the Fund will ask holders of its Class A Shares to approve a
proposal to reclassify the Class A Shares as AIM Cash Reserve Shares of the
Fund. We encourage you to support the recommendation of the Board of Trustees.
The Fund is soliciting votes from persons who were record owners of
Class A Shares as of October 13, 1998. If you do not currently own Class A
Shares but owned these Shares on October 13, 1998, you are still eligible to
vote. While you are, of course, welcome to join us at the meeting, most
shareholders cast their vote by filling out and signing the proxy card that
accompanies the attached proxy statement. The attached proxy statement gives you
further information relating to the proposed plan of reclassification.
Your vote is important to us. Please mark, sign, and date the enclosed
proxy card and return it as soon as possible. For your convenience, we have
enclosed a self-addressed stamped envelope. If you have questions about the
proposal please call 1 (800) ___-____ during normal business hours. Thank you
for taking the time to consider this important proposal and for your investment
in the Fund.
Sincerely,
-----------------
---------
<PAGE> 3
AIM MONEY MARKET FUND
11 GREENWAY PLAZA
SUITE 100
HOUSTON, TEXAS 77046
NOTICE OF SPECIAL MEETING OF HOLDERS
OF CLASS A SHARES
TO BE HELD ON DECEMBER 11, 1998
TO THE HOLDERS OF CLASS A SHARES OF AIM MONEY MARKET FUND:
AIM Money Market Fund (Fund) hereby notifies you, a holder of
its Class A Shares, that it is holding a special meeting of holders of Class A
Shares. The Fund will hold the meeting on December 11, 1998, at ____ p.m., local
time, at the Fund's offices at 11 Greenway Plaza, Suite 100, Houston, Texas
77046.
The purposes of the meeting are:
1. To approve a Plan of Reclassification which will reclassify
the Class A Shares of the Fund as AIM Cash Reserve Shares of the Fund. The
number and value of shares of the Fund you hold will not change, and you will
not have to pay federal income taxes because of the reclassification.
2. To transact any other business, which the Fund does not
currently contemplate, that may properly come before the special meeting, in the
discretion of the proxies or their substitutes.
If you are a record owner of Class A Shares as of the close of
business on October 13, 1998, you are entitled to notice of, and to vote at, the
special meeting or any adjournments of the meeting.
PLEASE SIGN AND RETURN PROMPTLY IN THE ENCLOSED POSTAGE PAID
RETURN ENVELOPE THE ACCOMPANYING PROXY. MANAGEMENT OF THE FUND IS SOLICITING
THIS PROXY. THE FUND MUST HAVE HOLDERS OF AT LEAST ONE-THIRD OF ITS CLASS A
SHARES RETURN PROXIES OR BE PRESENT BEFORE IT CAN HOLD THE SPECIAL MEETING. YOU
MAY REVOKE YOUR PROXY AT ANY TIME BEFORE ITS EXERCISE IF YOU SIGN AND SEND THE
FUND A REVISED PROXY, IF YOU GIVE WRITTEN NOTICE OF REVOCATION TO THE FUND OR IF
YOU VOTE IN PERSON AT THE SPECIAL MEETING.
By order of the Board of Trustees,
CAROL F. RELIHAN
Secretary
October __, 1998
<PAGE> 4
AIM MONEY MARKET FUND
CLASS A SHARES
11 Greenway Plaza, Suite 100
Houston, Texas 77046
--------------------
PROXY STATEMENT
--------------------
SPECIAL MEETING OF HOLDERS OF CLASS A SHARES
TO BE HELD DECEMBER 11, 1998
INTRODUCTION
THE MEETING
A special meeting of holders of Class A Shares of AIM Money Market Fund
is being held on December 11, 1998 at __ p.m. The place of the meeting is the
Fund's offices at 11 Greenway Plaza, Suite 100, Houston, Texas 77046. The
purpose of the meeting is to vote on a Plan of Reclassification (Plan). The Plan
provides for the reclassification of the Class A Shares as AIM Cash Reserve
Shares of the Fund.
AIM Money Market Fund is a series portfolio of AIM Funds Group, a
Delaware business trust. In this proxy statement, Fund will mean either the
business trust or AIM Money Market Fund, as appropriate.
REASONS FOR THE MEETING
The Fund offers four classes of its shares. Of these classes, two have
nearly identical expense structures: Class A Shares and Cash Reserve Shares. The
sole difference between the Class A Shares you own and the Cash Reserve Shares
is that when you buy Class A Shares, you pay an initial sales charge, but when
you buy Cash Reserve Shares, you do not pay an initial sales charge. In all
other respects, shares of these classes are the same.
The Board of Trustees has concluded that, with the advancement of
technology, the original reason for offering Class A Shares no longer exists.
The Fund historically offered Class A Shares in connection with a periodic,
dollar-cost averaging investment program. This program allowed investors to pay
an initial sales charge on Fund shares and then periodically exchange those
shares at net asset value for other fixed income or equity funds in The AIM
Family of
<PAGE> 5
Funds--Registered Trademark--. Today, the Fund's transfer agent is better able
to track an investor's purchases. As a result, when an investor exchanges shares
from one fund in The AIM Family of Funds to another fund, the transfer agent can
easily determine whether an initial sales charge is due.
The Board of Trustees also believes that all holders of Class A and
Cash Reserve Shares may benefit from a reduction in certain expenses, such as
state registration fees, that may occur because of the reclassification of the
Class A Shares. Reclassification of the Class A Shares should also make it
easier for investors to purchase Fund shares by eliminating the need to make a
choice between classes of shares that are essentially identical.
The Board of Trustees concluded that it was in the best interests of
shareholders to adopt the Plan, and has recommended its approval by holders of
Class A Shares.
If the holders of Class A Shares approve the Plan, the Fund will
reclassify the Class A Shares as Cash Reserve Shares as of December 21, 1998.
Since the Fund seeks to maintain a constant net asset value of $1.00 per share,
regardless of class, the number of shares you own in the Fund will not change as
a result of the reclassification. In addition, you will not have to pay federal
income taxes as a result of the reclassification.
VOTING INFORMATION
You may vote at the meeting if you own Class A Shares of the Fund as of
the close of business on October 13, 1998. On that date, ____________ Class A
Shares were outstanding. Each share you own has one vote. A fractional share has
a fractional vote. The Board of Trustees is asking you to vote in favor of the
Plan.
The Fund has sent you a proxy with this proxy statement. The proxy
states that Charles T. Bauer and Gary T. Crum will act as proxies on your behalf
in voting your shares at the meeting. If you want these persons to vote your
shares, you must sign your proxy and return it to the Fund before the meeting.
If you give these persons instructions on your proxy, they will follow them. If
you send back a signed proxy but do not give them instructions, they will vote
your shares FOR the Plan. If any other matter comes up at the meeting, they will
also vote as management advises. The Board of Trustees is not aware of any other
matters that may arise at the meeting.
The holders of at least one-third of the outstanding Class A Shares
must be present at the meeting or represented by proxy for the Fund to conduct
business. Approval of the Plan requires the affirmative vote of a majority of
the votes cast at the meeting. If you return an executed proxy but abstain from
voting, the Fund will count your shares as present at the meeting but not as
votes cast. Broker non-votes also count as present at the meeting but not as
votes cast. A broker non-vote arises when a broker does not receive direction
from an underlying beneficial owner on how to vote the shares and the broker
does not have the authority to vote the shares on its own.
2
<PAGE> 6
You have the right to revoke your proxy at any time prior to the
meeting. You can do so by signing a new proxy or by sending the Secretary of the
Fund a notice of revocation. If you attend the meeting, you may withdraw your
proxy and vote in person.
The Fund may adjourn the meeting to solicit additional votes. The
proxies will vote in favor of adjournment votes cast in favor of the Plan. An
adjournment requires the affirmative vote of a majority of the votes cast.
The Fund has hired Shareholder Communications Corporation to help it
solicit proxies. The Fund expects to pay this solicitor approximately $_________
for its services. Solicitation of proxies will occur by mail, telephone,
facsimile, telegraph or personal interview. The officers of the Fund do not
receive money from the Fund for their solicitation efforts. The Fund will pay
for solicitation costs and other costs incurred for the meeting. If brokers and
other firms incur expenses when they forward this proxy statement to beneficial
owners, the Fund will pay for those expenses.
The Fund intends to mail this proxy statement and the proxy on or about
October __, 1998.
APPROVAL OF PLAN OF RECLASSIFICATION
INTRODUCTION
At the meeting, holders of Class A Shares are being asked to approve
the Plan. The Plan provides for the reclassification of Class A Shares as Cash
Reserve Shares. In the event holders of Class A Shares approve the Plan, the
proportionate undivided interest in the net assets of the Fund attributable to
the Class A Shares shall become a part of the proportionate undivided interest
in the net assets of the Fund attributable to the Cash Reserve Shares. In
exchange, holders of Class A Shares will receive the same number of Cash Reserve
Shares as the number of Class A Shares that they owned immediately before the
Reclassification. The Class A Shares will then be canceled. The net asset value
of each Cash Reserve Share will be the same as the net asset value of the Class
A Shares so reclassified. A copy of the Plan is attached as Exhibit A to this
Proxy Statement.
Following the reclassification, A I M Advisors, Inc. ("AIM Advisors")
will continue to manage the Fund's investments in accordance with the Fund's
investment objectives and policies. Cash Reserve Shares may be purchased and
redeemed in the same manner as Class A Shares, except that Cash Reserve Shares
are not subject to an initial sales charge. The various services currently
provided to Class A Shareholders will not be affected by the reclassification.
You may exchange Cash Reserve Shares issued to you in connection with the
reclassification for Class A shares of other funds in The AIM Family of Funds
without incurring a sales charge. If you buy other Cash Reserve Shares, however,
and exchange those shares for Class A Shares of other funds in The AIM Family of
Funds, you may pay a sales charge when you make the exchange. You may benefit
from the delay in paying an initial sales charge if you do not exchange those
Cash Reserve
3
<PAGE> 7
Shares for Class A Shares of other funds immediately after you purchase your
Cash Reserve Shares. See "Effects of the Reclassification."
The Fund will receive an opinion of Ballard Spahr Andrews & Ingersoll,
LLP to the effect that the reclassification will constitute a tax-free
classification for federal income tax purposes. Thus, holders of Class A Shares
will not have to pay federal income taxes as a result of the reclassification.
See "Additional Information about the Plan - Federal Tax Consequences."
BOARD CONSIDERATIONS AND REASONS FOR THE RECLASSIFICATION
The Board of Trustees of the Fund determined that the proposed
reclassification of Class A Shares as Cash Reserve Shares is in the best
interests of the shareholders, and recommended approval of the Plan by the
holders of Class A Shares at the meeting. A summary of the information that was
presented to, and considered by, the Board of Trustees in making its
determination is provided below.
At a meeting of the Board of Trustees held on September 25, 1998, AIM
Advisors proposed that the Board of Trustees approve the proposed Plan. The
Trustees received from AIM Advisors written materials that described the
structure and tax consequences of the proposed reclassification and contained
information concerning Class A Shares and Cash Reserve Shares, including
comparative total return and fee and expense information.
The Trustees noted that the Class A Shares and Cash Reserve Shares are
essentially identical. Since the two classes represent interests in the same
investment portfolio (the Fund), they share the Fund's investment objectives,
policies and restrictions. The Fund's investment adviser and custodian provide
services to the Fund as a whole, and not to individual classes of shares. The
Fund's distributor and transfer agent provide services on a class basis, and are
the same for each class. The expense ratios for the Class A Shares and the Cash
Reserve Shares for the fiscal year ended December 31, 1997 were the same. The
only difference between the two classes is that Class A Shares are sold subject
to an initial sales charge.
Class A Shares were initially created and available for those investors
that desired to invest in a money market fund initially, and then periodically
transfer moneys from that fund to other fixed income and equity funds. Investors
would purchase Class A Shares subject to an initial sales charge. The investor
would later exchange the Class A Shares for Class A shares of other fixed income
or equity funds and not pay a sales charge upon the exchange. Since this program
began, the Fund's transfer agent has developed more sophisticated technology
which permits it to track more easily whether investors have paid sales charges
on shares purchased. AIM Advisors informed the Board of Trustees that it has
concluded Class A Shares are no longer needed to address current marketplace
needs. The Board of Trustees believes that it will be less expensive for
shareholders desiring to make periodic investments in The AIM Family of Funds to
use Cash Reserve Shares, since any applicable sales charges will not be paid
until an investor purchases shares that are subject to an initial sales charge.
The Board of Trustees also concluded that all shareholders of the combined
classes might benefit from a reduction in certain expenses, such as state fees
for registration of mutual fund shares and other economies of scale.
Reclassification of
4
<PAGE> 8
the Class A Shares should also make it easier for investors to purchase Fund
shares by eliminating the need to make a choice between classes of shares that
are essentially identical.
The Board of Trustees noted that no initial sales or other charges
would be imposed on any of the Cash Reserve Shares acquired by the holders of
Class A Shares in connection with the reclassification. In addition, the Board
noted that the Cash Reserve Shares issued in exchange for the Class A Shares as
a result of the reclassification will continue to be eligible to be exchanged
for Class A shares of any of The AIM Family of Funds at net asset value.
Finally, the Board of Trustees reviewed the principal terms of the Plan. The
Board of Trustees noted that the Fund would receive an opinion of counsel that
the reclassification would be tax-free as to the Fund and its holders of Class A
Shares.
Based upon their evaluation of the information presented to them, the
Board of Trustees determined that the reclassification is in the best interest
of the shareholders and recommended the approval of the Plan by the holders of
Class A Shares at the meeting.
EFFECT OF THE RECLASSIFICATION
The Class A Shares and Cash Reserve Shares are two of four separate
classes of shares of beneficial interest of the Fund. On October 13, 1998, the
net assets of Class A Shares were $____________ and Cash Reserve Shares were
$_____________. As a result of the reclassification, all of the issued and
outstanding Class A Shares will become Cash Reserve Shares. The stock records of
the Fund will be revised to show each holder of outstanding Class A Shares to be
the owner of an equal number of Cash Reserve Shares and the cancellation of all
of the outstanding Class A Shares. All Cash Reserve Shares issued in connection
with the reclassification will continue to be eligible to be exchanged for Class
A Shares of any of The AIM Family of Funds without payment of an initial sales
charge.
Class A Shares and Cash Reserve Shares are essentially identical. As
separate classes of the Fund, the Class A Shares and the Cash Reserve Shares
share the Fund's investment objective of seeking as high a level of current
income as is consistent with the preservation of capital and liquidity. The
existing investment advisory agreement for the Fund will not change as a result
of the reclassification since it pertains to the management of the assets of the
Fund as a whole. There will be no changes in operating expenses and no changes
in the way AIM Advisors will manage, advise or operate the Fund. Cash Reserve
Shares have the same voting rights, dividend rights and liquidation rights as
Class A Shares except that in calculating the amount of dividends paid, the
Class A shares and Cash Reserve Shares each bear their respective class
expenses. Cash Reserve Shares may be purchased, exchanged and redeemed in the
same manner as Class A Shares, except that Cash Reserve Shares are not subject
to an initial sales charge. As with Class A Shares, dividends from net
investment income on Cash Reserve Shares are declared daily and paid monthly
while distributions of net realized capital gains are made annually.
5
<PAGE> 9
ADDITIONAL INFORMATION ABOUT THE PLAN
TERMS OF THE RECLASSIFICATION
The terms and conditions under which the reclassification may be
consummated are set forth in the Plan. The principal provisions of the Plan are
described below.
TRANSFER OF ASSETS AND LIABILITIES
At the effective time of the reclassification, all of the issued and
outstanding Class A Shares shall be reclassified and become Cash Reserve Shares,
and thereafter shall have the attributes of Cash Reserve Shares. After the
effective time, (i) the proportionate undivided interest in the net assets of
the Fund attributable to the Class A Shares shall become a part of the
proportionate undivided interest in the net assets of the Fund attributable to
the Cash Reserve Shares, (ii) the books and records of the Fund relating to the
Class A Shares shall become a part of the books and records of the Fund relating
to the Cash Reserve Shares.
Each holder of record of Class A Shares will receive that number of
Cash Reserve Shares representing interests with an aggregate net asset value
equal to the aggregate net asset value of the Class A Shares held by such holder
at the effective time of the reclassification. This will be accomplished by the
establishment of an open account on the stock records of the Fund in the name of
each holder of Class A Shares representing the respective number of Cash Reserve
Shares due such holder. Simultaneously with such crediting of Cash Reserve
Shares to the holders of record, the Class A Shares held by such holders shall
be canceled.
As soon as practicable after the effective time of the
reclassification, the Fund shall amend its Agreement and Declaration of Trust to
eliminate the Class A Shares of the Fund as a class established thereunder, and
shall take any and all other action necessary to reflect the reclassification of
the Class A Shares as Cash Reserve Shares.
The consummation of the reclassification is expected to occur on
December 21, 1998 at 9:00 a.m. Eastern Time, or such later date and time as the
officers of the Fund shall determine.
OTHER TERMS
Prior to the reclassification, the Fund must receive:
o such authority, including "no-action" letters, and orders
from the Securities and Exchange Commission and state securities commissions, as
may be necessary to permit the parties to carry out the transactions
contemplated by the Plan;
o an opinion of Ballard Spahr Andrews & Ingersoll, LLP to the
effect that the Plan will not , in and of itself, give rise to the recognition
of income, gain or loss for Federal income tax purposes to the holders of Class
A Shares;
6
<PAGE> 10
o an opinion of Ballard Spahr Andrews & Ingersoll, LLP,
addressed to and in form and substance satisfactory to the Fund, to the effect
that the Plan has been duly authorized and approved by all requisite action of
the Fund and the holders of Class A Shares; and
o a certificate of an officer of the Fund stating that the
Plan has been approved by the holders of Class A Shares at a special meeting by
the affirmative vote of a majority of the voting securities cast at the meeting
and that holders of more than one third (1/3) of the voting securities of Class
A representing an interest in such Class A and entitled to vote on the Plan were
present or represented by proxy.
The Fund may terminate the Plan with the approval of its Board of
Trustees at any time prior to the effective time, notwithstanding its approval
by the holders of Class A Shares if, in the judgment of such Board, proceeding
with the Plan would be inadvisable.
FEDERAL TAX CONSEQUENCES
The following is a general summary of the material Federal income tax
consequences of the reclassification and is based upon the current provisions of
the Internal Revenue Code of 1986, as amended (the "Code"), the existing
Treasury regulations thereunder, current administrative rulings of the Internal
Revenue Service ("IRS") and judicial decisions, all of which are subject to
change. The reclassification should not be treated as an exchange in which gain
or loss is recognized for Federal income tax purposes, with the principal
Federal income tax consequences that: (i) no gain or loss will be recognized by
any shareholder of the Fund upon the exchange of Class A Shares solely for Cash
Reserve Shares; (ii) the tax basis of the Cash Reserve Shares to be received by
a holder of Class A Shares will be the same as the tax basis of the Class A
Shares surrendered in exchange therefor; and (iii) the holding period of the
Cash Reserve Shares to be received by a holder of Class A Shares will include
the holding period for which such holder held the Class A Shares exchanged
therefor.
As a condition to the reclassification, Ballard Spahr Andrews &
Ingersoll, LLP will render a favorable opinion to the Fund as to the foregoing
Federal income tax consequences of the reclassification, which opinion will be
conditioned upon the accuracy, as of the date of reclassification, of certain
representations of the Fund upon which Ballard Spahr Andrews & Ingersoll, LLP
will rely in rendering its opinion, which representations include, but are not
limited to, the following (taking into account for purposes thereof any events
that are part of the Plan): (1) each Class A Share and each Cash Reserve Share
will represent an equal pro rata interest in the Fund and will have identical
voting, dividend, liquidation, and other rights, preferences, powers,
restrictions, limitations, qualifications, designations, terms, and conditions,
except that: (a) the Class A Shares and Cash Reserve Shares will have a
different class designation, (b) the Class A Shares are subject to an initial
sales charge, (c) the Class A Shares and Cash Reserve Shares have had different
exchange privileges with respect to an exchange of Fund shares for shares of
another fund of the AIM Family of Funds and (d) in calculating the amount of
dividends paid, the Class A shares and Cash Reserve Shares each bear their
respective class expenses (which class expenses currently represent the same
percentage of average net assets annually); (2) the Fund does not have
outstanding any warrants, options, convertible securities, or similar
7
<PAGE> 11
instruments under which any person could acquire any beneficial interest in the
Fund and the Fund has no present intention of ever offering any options,
warrants, convertible securities, or similar instruments under which any person
could acquire any beneficial interest in the Fund, except for the issuance of
additional shares at net asset value in the normal course of its business as a
open-end diversified management investment company (or as a series thereof)
under the Investment Company Act of 1940 (the "1940 Act"); (3) the
reclassification will in no way alter the historic business of the Fund, and the
Fund, both before and after the reclassification, will pursue the same unique
investment objective spelled out in its prospectus; (4) the reclassification is
part of an isolated transaction as to particular shareholders, and the
management of the Fund has no plan or intention to increase periodically the
proportionate interest of any holder of a particular class of shares of the Fund
in the assets or earnings and profits of the Fund at the expense of other
holders of beneficial interests in the Fund; (5) to the best of the knowledge of
the management of the Fund, there is no plan or intention on the part of any
holder of Class A Shares (or any group of such holders) that such holder present
to the Fund for redemption the Cash Reserve Shares that such holder will receive
upon the reclassification, although individual investors may, in the ordinary
course of investing, decide to dispose of their interests at any time and the
management of the Fund has no knowledge of the individual investment strategies
of any particular investor; (6) the Fund has no plan or intention to redeem or
otherwise reacquire shares that have been or will be issued, other than in the
ordinary course of its business as a regulated investment company operating
under the Investment Company Act of 1940; (7) the Fund paid, or will pay, and
the shareholders have paid or will pay, their respective expenses, if any, in
connection with the reclassification; and (8) the fair market value of the Cash
Reserve Shares to be received by holders of Class A Shares will be equal to the
fair market value of such Class A Shares immediately before the
reclassification.
THE FOREGOING DESCRIPTION OF THE FEDERAL INCOME TAX CONSEQUENCES OF THE
RECLASSIFICATION IS MADE WITHOUT REGARD TO THE PARTICULAR FACTS AND
CIRCUMSTANCES OF ANY HOLDER OF CLASS A SHARES. YOU ARE URGED TO CONSULT YOUR OWN
TAX ADVISORS AS TO THE SPECIFIC CONSEQUENCES TO YOU OF THE RECLASSIFICATION,
INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL, FOREIGN AND OTHER TAX
LAWS.
FINANCIAL INFORMATION
The audited financial statements of the Fund and the report thereon by
KPMG Peat Marwick LLP, are set forth in the annual report of the Fund. The
unaudited interim financial statements for the Fund for the six-month period
ended June 30, 1998, are set forth in the Semiannual Report of the Fund.
The Fund will provide, without charge, to each person solicited by this
proxy statement, on the oral or written request of any such person, a copy of
the annual and semi-annual reports as filed with the Securities and Exchange
Commission for its most recent fiscal year. Oral requests may be made by
contacting the fund at 1 (800) _______. Written requests should be sent to the
address appearing on the first page of this proxy statement or faxed to the Fund
at ___________.
8
<PAGE> 12
OTHER MATTERS
The trustees do not know of any matters to be presented at the meeting
other than those set forth in this proxy statement. If any other business should
come before the meeting, the persons named in the accompanying proxy will vote
thereon in accordance with their best judgment in the best interest of
shareholders.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
SIGNIFICANT HOLDERS
To the best knowledge of the Fund, the names and addresses of the
record holders of 5% or more of the outstanding Class A Shares and Cash Reserve
Shares as of October 13, 1998, and the amount of the outstanding shares owned by
such holders, are set forth below. The Fund has no knowledge of shares held
beneficially.
<TABLE>
<CAPTION>
Shares of Record
Name and Address Owned as of Percent
Portfolio (Class) of Record Owners October 13, 1998 of Class
----------------- ---------------- ---------------- --------
<S> <C> <C> <C>
</TABLE>
OWNERSHIP OF OFFICERS AND TRUSTEES
As of the Record Date, none of the directors or the chief executive
officer of AIM Funds Group beneficially owned Class A Shares or Cash Reserve
Shares, other than [_________________ _______________________].
ADDITIONAL INFORMATION ABOUT THE FUND
INVESTMENT ADVISER AND ADMINISTRATOR
A I M Advisors, Inc. 11 Greenway Plaza, Suite 100, Houston, Texas
77046, serves as the Fund's investment adviser. Currently, AIM Advisors also
provides the services of the Fund's principal financial officer and his staff,
and fund accounting services.
In addition, pursuant to the terms of a transfer agency and service
agreement, A I M Fund Services, Inc., a wholly owned subsidiary of AIM
Advisors and a registered transfer agent,
9
<PAGE> 13
provides transfer agency, dividend distribution and disbursement and shareholder
services to the Fund. Its principal address is P.O. Box 4739, Houston, Texas
77210-4739.
DISTRIBUTOR
A I M Distributors, Inc., a registered broker-dealer and a wholly owned
subsidiary of AIM Advisors, acts as the distributor of Class A, Class B, Class
C and Cash Reserve Shares of the Fund. Its address is P.O. Box 4739, Houston,
Texas 77210-4739.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Trustees of the Fund has selected KPMG Peat Marwick, LLP
as independent public accountants for the fiscal year ending December 31, 1998.
KPMG Peat Marwick LLP has served as the Fund's independent public accountants
since 1993 and is expected to be present at the meeting and available to answer
questions.
SHAREHOLDER PROPOSALS
As a general matter, the Fund does not hold regular annual meetings of
shareholders. Any shareholder who wishes to submit proposals for consideration
at a meeting of shareholders of the Fund should send such proposal to AIM Funds
Group at the address set forth on the first page of this proxy statement. To be
considered for presentation at a shareholders' meeting, proposals must be
received a reasonable time before a solicitation is made and must comply with
applicable law.
By order of the Board of
Trustees
Carol F. Relihan
Secretary
October __, 1998
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EXHIBIT A
PLAN OF RECLASSIFICATION
FOR THE
CLASS A SHARES
OF
AIM MONEY MARKET FUND
AN INVESTMENT PORTFOLIO OF
AIM FUNDS GROUP
This Plan of Reclassification for the Class A shares of AIM Money
Market Fund (the "Fund"), an investment portfolio of AIM Funds Group ("AFG"), is
dated this ____ day of September, 1998.
WHEREAS, AFG is a Delaware business trust and a registered investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Fund is an investment portfolio of AFG representing a
separate series of shares of beneficial interest of AFG that is operated as a
money market fund in accordance with Rule 2a-7 adopted under the 1940 Act;
WHEREAS, the shares of beneficial interest in the Fund have been
divided into Class A shares, Class B shares, Class C shares and Cash Reserve
shares;
WHEREAS, the Class A shares of the Fund were created for investors
wishing to use a money market fund as part of a dollar cost averaging program
for investment in mutual funds included in the AIM Family of Funds having a
front end sales load;
WHEREAS, the Board of Trustees of AFG has reviewed the current need
for, operational aspects of and use of Class A shares, together with alternative
classes of shares of the Fund available to investors, taking into consideration
investment objectives, policies, restrictions, fees and expenses; and
WHEREAS, the Board of Trustees of AFG has determined that the Cash
Reserve class of shares of the Fund is substantially similar to the Class A
shares, and that it would be in the best interests of the Class A shareholders
and the Cash Reserve shareholders of AFG for the Class A shares to be
reclassified as Cash Reserve shares of AFG.
NOW, THEREFORE, the Class A shares of the Fund shall be reclassified as
Cash Reserve shares of the Fund, subject to and on the following terms and
conditions:
1. APPROVAL OF SHAREHOLDERS. A meeting of the holders of the Class A
shares shall be duly called and constituted for the purpose of acting upon this
Plan of Reclassification and the transactions contemplated herein (the "Plan of
Reclassification"). Approval by
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such shareholders of this Plan of Reclassification shall authorize AFG to
take the actions required to effect the Plan of Reclassification.
2. PLAN OF RECLASSIFICATION.
(a) At the Effective Time described in Section 3
below, all of the issued and outstanding Class A
shares shall be reclassified and become Cash
Reserve shares, and thereafter shall have the
attributes of Cash Reserve shares. After the
Effective time, (i) the proportionate undivided
interest in the net assets of the Fund
attributable to the Class A shares shall become a
part of the proportionate undivided interest in
the net assets of the Fund attributable to the
Cash Reserve shares, (ii) the expenses, costs,
charges and reserves allocated to the Class A
shares immediately prior to the Effective Time
shall become expenses, costs, charges and reserves
of the Cash Reserve shares, and (iii) the books
and records of the Fund relating to the Class A
shares shall become a part of the books and
records of the Fund relating to the Cash Reserve
shares.
(b) Each shareholder of record of Class A shares will receive
that number of Cash Reserve shares representing interests with an aggregate net
asset value equal to the aggregate net asset value of the Class A shares held by
such shareholder at the Effective Time. Such issuance will be accompanied by the
establishment of an open account on the records of the Cash Reserve class in the
name of each such shareholder of Class A shares and representing the respective
number of Cash Reserve shares due such shareholder. Fractional Cash Reserve
shares will be carried to the third decimal place. Certificates representing
Cash Reserve shares generally will not be issued. Simultaneously with such
crediting of Cash Reserve shares to the shareholders of record, the Class A
shares held by such shareholders shall be canceled.
(c) As soon as practicable after the Effective time, AFG shall
amend its Amended and Restated Agreement and Declaration of Trust to eliminate
the Class A shares of the Fund as a Class established thereunder, and shall take
any and all other action necessary to reflect the reclassification of the Class
A shares as Cash Reserve shares.
3. EFFECTIVE TIME OF THE RECLASSIFICATION. The consummation of the
reclassification of the Class A shares contemplated by this Plan of
Reclassification shall occur on December 21, 1998 at 9:00 a.m. Eastern Time
or such later date and time as the officers of AFG shall determine (the
"Effective Time").
4. CONDITIONS PRECEDENT. The obligations of AFG to effectuate the
Plan of Reclassification shall be subject to the satisfaction of each of
the following conditions:
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(a) Such authority, including "no-action"
letters, and orders from the Securities and
Exchange Commission (the "Commission") and state
securities commissions, as may be necessary to
permit the parties to carry out the transactions
contemplated by this Plan of Reclassification,
shall have been received.
(b) AFG shall have received an opinion of
Ballard Spahr Andrews & Ingersoll, LLP ("BSA&I")
to the effect that consummation of the
transactions contemplated by this Plan of
Reclassification will not, in and of itself,
give rise to the recognition of income, gain or
loss for Federal income tax purposes to the Class
A shareholders or to the Fund.
(c) AFG shall have received an opinion of BSA&I,
dated as of the Effective Time, addressed to and
in form and substance satisfactory to AFG, to the
effect that this Plan of Reclassification has
been duly authorized and approved by all
requisite action of AFG and the holders of the
Class A shares.
(d) This Plan of Reclassification shall have been
approved by the Class A shareholders at an annual
or special meeting by the affirmative vote of a
majority of the voting securities cast at a
meeting considering the Plan of Reclassification
if the holders of more than one third (1/3) of
the voting securities of Class A representing an
interest in such Class A and entitled to vote on
the Plan of Reclassification are present or
represented by proxy.
At any time prior to the Effective Time, any of the foregoing
conditions may be waived by AFG if, in the judgment of its Board of Trustees,
such waiver will not have a material adverse effect on the benefits intended
under this Plan of Reclassification for the Class A shareholders.
5. TERMINATION. AFG may terminate this Plan of Reclassification with
the approval of its Board of Trustees at any time prior to the Effective
Time, notwithstanding approval thereof by the Class A shareholders if, in
the judgment of such Board, proceeding with the Plan of Reclassification
would be inadvisable.
6. FURTHER ASSURANCES. AFG shall take such further action as may be
necessary or desirable and proper to consummate the transactions contemplated
hereby.
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AIM MONEY MARKET FUND
11 GREENWAY PLAZA, SUITE 100
HOUSTON, TEXAS 77046
PROXY FOR THE SPECIAL MEETING OF HOLDERS OF CLASS A SHARES
OF AIM MONEY MARKET FUND
TO BE HELD DECEMBER 11, 1998
The undersigned hereby appoints each of Charles T. Bauer and Gary T.
Crum, individually, as proxy and attorney-in-fact for the undersigned with full
power of substitution to vote on behalf of the undersigned at the special
meeting of holders of Class A Shares of AIM Money Market Fund ("Fund"), a
portfolio of the AIM Funds Group, to be held on December 11, 1998, and at any
adjournment or postponement thereof, all Class A Shares of the Fund standing in
the name of the undersigned or which the undersigned may be entitled to vote as
follows:
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF THE SHAREHOLDER MAKES NO
DIRECTION, THIS PROXY WILL BE VOTED "FOR" THE PROPOSAL IDENTIFIED BELOW AND
DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT. In their discretion, the proxies
are authorized to vote upon such other business as may properly come before the
special meeting or any adjournments or postponements thereof, hereby revoking
any proxy or proxies heretofore given by the undersigned.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES.
1. To approve a Plan of Reclassification providing for the reclassification of
Class A Shares of the Fund as AIM Cash Reserve Shares of the Fund.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
IF YOU DO NOT VOTE ON THE FOREGOING PROPOSAL, THE PROXIES SHALL VOTE
"FOR" THAT PROPOSAL.
Please sign:
Dated:
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Signature
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Signature (if held jointly)
When shares are held by joint tenants, both
should sign. When signing as attorney,
executor, administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in the corporate
name by president or other authorized
officer. If a partnership, please sign in the
partnership name by authorized person.
PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY PROMPTLY USING THE ENCLOSED
ENVELOPE.
