<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF
1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
_______________________________________________________________________________
SHORT-TERM INVESTMENTS CO.
(For its Series Portfolios:
Liquid Assets Portfolio
Prime Portfolio)
SHORT-TERM INVESTMENTS TRUST
(For its Series Portfolios:
Treasury Portfolio
Treasury TaxAdvantage Portfolio)
TAX-FREE INVESTMENTS CO.
(For its Series Portfolio:
Cash Reserve Portfolio)
_______________________________________________________________________________
(Name of Registrant as Specified In Its Charter or Declaration of Trust)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:
_______________________________________________________________________________
4) Date Filed:
_______________________________________________________________________________
<PAGE> 2
SHORT-TERM INVESTMENTS CO.
SHORT-TERM INVESTMENTS TRUST
TAX-FREE INVESTMENTS CO.
11 Greenway Plaza, Suite 1919
Houston, TX 77046
December 20, 1996
Dear Shareholder:
As you may know, A I M Management Group Inc. ("AIM Management"), the parent
company of A I M Advisors, Inc. ("AIM"), the investment advisor to The AIM
Family of Funds--Registered Trademark--, has entered into an agreement under
which AIM Management will merge with a subsidiary of INVESCO plc. As a result
of this merger, it is necessary for the shareholders of each of the AIM Funds
to approve a new investment advisory agreement (and in some cases, a new
sub-advisory agreement).
The following important facts about the transaction are outlined below:
- The merger has no effect on the number of shares you own or the value of
those shares.
- The advisory fees and expenses charged to your Fund will not change as a
result of this merger.
- The investment objectives of the Fund will remain the same and key
employees of AIM will continue to manage your Funds as they have in the
past.
- The merger will not change the quality of the investment management and
shareholder services that you have received over the years.
Shareholders are also being asked to approve Directors/Trustees, to approve
certain proposed changes in fundamental policies and to ratify the selection of
independent accountants. After careful consideration, the Board of
Directors/Trustees of your Fund has unanimously approved these proposals and
recommends that you read the enclosed materials carefully and then vote FOR all
proposals.
Since all of the AIM Funds are required to conduct shareholder meetings, you
will receive at least one statement and a proxy card for each Fund you own.
PLEASE VOTE EACH PROXY CARD YOU RECEIVE.
Your vote is important. Please take a moment now to sign and return your proxy
cards in the enclosed postage paid return envelope. If we do not hear from you
after a reasonable amount of time you may receive a telephone call from our
proxy solicitor, Shareholder Communications Corporation, reminding you to vote
your shares.
Thank you for your cooperation and continued support.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
- ------------------------------
GROUP D
<PAGE> 3
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
ENCLOSED YOU WILL FIND ONE OR MORE PROXY CARDS RELATING TO EACH OF THE
FUNDS FOR WHICH YOU ARE ENTITLED TO VOTE. PLEASE INDICATE YOUR VOTING
INSTRUCTIONS ON EACH OF THE ENCLOSED PROXY CARDS, DATE AND SIGN THEM, AND RETURN
THEM IN THE ENVELOPE PROVIDED. IF YOU SIGN, DATE AND RETURN A PROXY CARD BUT
GIVE NO VOTING INSTRUCTIONS, YOUR SHARES WILL BE VOTED "FOR" THE NOMINEES FOR
TRUSTEE OR DIRECTOR NAMED IN THE ATTACHED PROXY STATEMENT AND "FOR" ALL OTHER
PROPOSALS INDICATED ON THE CARDS. IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF
FURTHER SOLICITATION, WE ASK YOUR COOPERATION IN MAILING IN YOUR PROXY CARDS
PROMPTLY. UNLESS PROXY CARDS ARE SIGNED BY THE APPROPRIATE PERSONS AS INDICATED
IN THE INSTRUCTIONS BELOW, THEY WILL NOT BE VOTED.
- --------------------------------------------------------------------------------
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance to
you and avoid the time and expense involved in validating your vote if you fail
to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party signing
should conform exactly to the name shown in the registration on the proxy card.
3. All Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of registration. For
example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURE
- ------------------------------------------------------------ ------------------------------
<S> <C>
Trust Accounts
(1) ABC Trust Account.................................. Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d 12/28/78................ Jane B. Doe
Partnership Accounts
(1) The XYZ Partnership................................ Jane B. Smith, Partner
(2) Smith and Jones, Limited Partnership............... Jane B. Smith, General Partner
Custodial or Estate Accounts
(1) John B. Smith, Cust. f/b/o John B. Smith, Jr.
UGMA/UTMA......................................... John B. Smith
(2) Estate of John B. Smith............................ John B. Smith, Jr., Executor
Corporate Accounts
(1) ABC Corp. ......................................... ABC Corp.
John Doe, Treasurer
(2) ABC Corp. ......................................... John Doe, Treasurer
(3) ABC Corp. c/o John Doe, Treasurer.................. John Doe
(4) ABC Corp. Profit Sharing Plan...................... John Doe, Trustee
</TABLE>
<PAGE> 4
SHORT-TERM INVESTMENTS CO.
Liquid Assets Portfolio
Prime Portfolio
SHORT-TERM INVESTMENTS TRUST
Treasury Portfolio
Treasury TaxAdvantage Portfolio
TAX-FREE INVESTMENTS CO.
Cash Reserve Portfolio
11 Greenway Plaza, Suite 1919, Houston, Texas 77046-1173
------------------------------
NOTICE OF JOINT ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 7, 1997
------------------------------
TO THE SHAREHOLDERS:
A joint annual meeting of shareholders of Short-Term Investments Co.
("STIC"), Short-Term Investments Trust ("STIT") and Tax-Free Investments Co.
("TFIC") will be held on Friday, February 7, 1997 at 2:00 p.m. local time at 11
Greenway Plaza, Suite 1919, Houston, Texas, with respect to each of the
investment companies and their series portfolios listed above (such portfolios
are collectively referred to as the "Funds"), for the following purposes:
(1) For each of STIC, STIT and TFIC, to elect nine Directors/Trustees, each
of whom will serve until his successor is elected and qualified.
(2) For each of the Funds, to approve a new Investment Advisory Agreement
with A I M Advisors, Inc.
(3) For each of the Funds, to eliminate the fundamental investment policy
prohibiting or restricting investments in other investment companies
and/or to amend certain related fundamental investment policies.
(4) For each of STIC, STIT and TFIC, to ratify the selection of KPMG Peat
Marwick LLP as independent accountants for the fiscal years ending in
1997.
(5) To transact such other business as may properly come before the
meeting.
Shareholders of record at the close of business on December 3, 1996 are
entitled to vote at the annual meeting and any adjournments. If you attend the
annual meeting, you may vote your shares in person. If you expect to attend the
annual meeting in person, please notify the Funds by calling 1-800-952-3502. If
you do not expect to attend the annual meeting, please fill in, date, sign and
return the proxy card in the enclosed envelope which requires no postage if
mailed in the United States.
It is important that you return your signed proxy card promptly so that a
quorum may be assured.
December 20, 1996
Charles T. Bauer
Chairman of the Boards of
Directors/Trustees
<PAGE> 5
SHORT-TERM INVESTMENTS CO.
Liquid Assets Portfolio
Prime Portfolio
SHORT-TERM INVESTMENTS TRUST
Treasury Portfolio
Treasury TaxAdvantage Portfolio
TAX-FREE INVESTMENTS CO.
Cash Reserve Portfolio
11 Greenway Plaza, Suite 1919, Houston, Texas 77046-1173
------------------------------
JOINT PROXY STATEMENT
------------------------------
JOINT ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 7, 1997
------------------------------
The accompanying proxy is solicited by the Board of Directors/Trustees of
each of Short-Term Investments Co. ("STIC"), Short-Term Investments Trust
("STIT") and Tax-Free Investments Co. ("TFIC") (collectively, the "Companies"),
on behalf of the series portfolios listed above (collectively referred to as the
"Funds") in connection with the joint annual meeting of shareholders of the
Companies to be held at the offices of A I M Advisors, Inc. ("AIM"), 11 Greenway
Plaza, Suite 1919, Houston, Texas at 2:00 p.m. local time on Friday, February 7,
1997 (the "Annual Meeting"). A shareholder can revoke the proxy prior to its use
by appearing at the Annual Meeting and voting in person, by giving written
notice of such revocation to the Secretary of the applicable Company, or by
returning a subsequently dated proxy. If you expect to attend the Annual Meeting
in person, please notify the Funds by calling 1-800-952-3502.
The following table summarizes each proposal to be presented at the Annual
Meeting and the Funds to be solicited pursuant to this joint proxy statement
with respect to such proposal:
<TABLE>
<CAPTION>
AFFECTED
COMPANIES OR
PROPOSAL FUNDS
- -------- ---------------
<C> <S> <C>
1. Election of Directors/Trustees All Companies
2. Approval of New Advisory Agreement All Funds
3. Elimination of Fundamental Investment Policy All Funds
Prohibiting or Restricting Investments in Other
Investment Companies and/or Amendment of Certain
Related Fundamental Investment Policies
4. Ratification of KPMG Peat Marwick LLP as Independent All Companies
Accountants
</TABLE>
<PAGE> 6
Upon the request of any shareholder, each of the Funds will furnish,
without charge, a copy of such Fund's annual report for its most recent fiscal
year together with any subsequent semi-annual report. All such requests should
be directed to AIM at 1-800-347-4246.
VOTING
At the Annual Meeting, shareholders of record at the close of business on
December 3, 1996 (the "Record Date") will be entitled to one vote per share on
the applicable proposals set forth above, with proportional votes for fractional
shares. STIC had 9,293,106,334.390 shares, STIT had 4,956,810,711.360 shares and
TFIC had 1,086,107,556.440 shares outstanding on the Record Date. The number of
shares outstanding on the Record Date for each series portfolio of STIC, STIT
and TFIC is set forth in Annex A. It is expected that this joint proxy statement
(the "proxy statement") and the accompanying proxy will be first sent to
shareholders on or about December 20, 1996.
The affirmative vote of a plurality of votes cast is necessary to elect
each Company's Board of Directors/Trustees (i.e., the nominees receiving the
most votes will be elected) (Proposal 1). The favorable vote of the holders of a
"majority of the outstanding voting securities" of each Fund, as defined in the
Investment Company Act of 1940, as amended (the "1940 Act"), is required to
approve each Fund's new Investment Advisory Agreement (Proposal 2), and to
approve the elimination of each Fund's fundamental investment policy prohibiting
or restricting investments in other investment companies and/or to amend certain
related fundamental investment policies (Proposal 3). The 1940 Act defines a
"majority of the outstanding voting securities" of a Fund to mean the lesser of
(a) the vote of holders of 67% or more of the voting shares of the Fund present
in person or by proxy at the Annual Meeting, if the holders of more than 50% of
the outstanding voting shares of the Fund are present in person or by proxy, or
(b) the vote of the holders of more than 50% of the outstanding voting shares of
the Fund. The affirmative vote of a majority of votes cast is necessary to
ratify the selection of KPMG Peat Marwick LLP as independent accountants for
each Company (Proposal 4).
The Board of Directors/Trustees of each of the Companies has named Charles
T. Bauer, Chairman, Robert H. Graham, President, and Carol F. Relihan,
Secretary, of each of the Companies, as proxies. Unless specific instructions
are given to the contrary in the accompanying proxy, the proxies will vote FOR
the election of each Director/Trustee named in the proxy statement, FOR the
approval of the new Investment Advisory Agreement for each of the Funds, FOR the
proposal to eliminate each Fund's fundamental investment policy prohibiting or
restricting investments in other investment companies and/or to amend certain
related fundamental investment policies, and FOR the ratification of the
selection of KPMG Peat Marwick LLP as independent accountants for the Companies.
Abstentions and broker non-votes (i.e., proxies from brokers or nominees
indicating that such persons have not received instructions from the beneficial
owner or other person entitled to vote shares on a particular matter with
respect to which the broker or nominee does not have discretionary power) with
respect to any proposal will be counted for purposes of determining whether a
quorum is present at the Annual Meeting. Abstentions and broker non-votes do not
count as votes cast but have the same effect as casting a vote against proposals
that require the vote of a majority of the shares present at the Annual Meeting,
provided a quorum exists.
The Board of Directors/Trustees of each of the Companies currently knows of
no other matters to be presented at the Annual Meeting. If any other matters
properly come before the Annual Meeting, the proxies will vote in accordance
with their best judgment. The proxies may propose to adjourn the
2
<PAGE> 7
meeting to permit further solicitation of proxies or for other purposes. Any
such adjournment will require the affirmative vote of a majority of the votes
cast.
PROPOSAL 1 --
ELECTION OF DIRECTORS/TRUSTEES
For election of Directors/Trustees at the Annual Meeting, the Board of
Directors/Trustees of each of the Companies has approved the nomination of
Charles T. Bauer, Bruce L. Crockett, Owen Daly II, Carl Frischling, Robert H.
Graham, John F. Kroeger, Lewis F. Pennock, Ian W. Robinson, and Louis S. Sklar,
each of whom is currently a Director/Trustee of each of the Companies, each to
serve as Director/Trustee until his successor is elected and qualified. All of
the nominees presently serve as Directors, Trustees or officers of the ten
open-end management investment companies advised by AIM (all such investment
companies and their series portfolios, if any, are referred to collectively as
the "AIM Funds").
The proxies will vote for the election of the nominees named below unless
authority to vote for any or all of the nominees is withheld in the proxy. Each
of the nominees has indicated that he is willing to serve as a Director/Trustee.
If any or all of the nominees should become unavailable for election due to
events not now known or anticipated, the persons named as proxies will vote for
such other nominee or nominees as the Directors/Trustees who are not "interested
persons" of the Companies, as defined in the 1940 Act, may recommend.
The following table sets forth certain information concerning the
Directors/Trustees:
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION/AFFILIATIONS DURING
DIRECTOR/ PAST FIVE YEARS AND (2) CURRENT
NAME (AGE) TRUSTEE SINCE DIRECTORSHIPS/TRUSTEESHIPS
- ------------------------------- --------------- -----------------------------------------------
<S> <C> <C>
Charles T. Bauer (77)* STIC 05/05/93 (1) Director, Chairman and Chief Executive
STIT 05/05/93 Officer, A I M Management Group Inc.; and
(and of its Chairman of the Board of Directors, A I M
predecessors Advisors, Inc., A I M Capital Management, Inc.,
since 1977) A I M Distributors, Inc., A I M Fund Services,
TFIC 03/04/92 Inc., A I M Institutional Fund Services, Inc.
(and of its and Fund Management Company. (2)
predecessors Director/Trustee of the AIM Funds.
since 1977)
</TABLE>
- ---------------
* Mr. Bauer is an "interested person" of each Company, as defined in the 1940
Act, primarily because of his positions with AIM, and its affiliated
companies, as set forth above, and through his ownership of stock of A I M
Management Group Inc., which owns all of the outstanding stock of AIM.
3
<PAGE> 8
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION/AFFILIATIONS DURING
DIRECTOR/ PAST FIVE YEARS AND (2) CURRENT
NAME (AGE) TRUSTEE SINCE DIRECTORSHIPS/TRUSTEESHIPS
- ------------------------------- --------------- -----------------------------------------------
<S> <C> <C>
Bruce L. Crockett (52) STIC 05/05/93 (1) Formerly, Director, President and Chief
STIT 05/05/93 Executive Officer, COMSAT Corporation (includes
TFIC 12/08/92 COMSAT World Systems, COMSAT Mobile
Communications, COMSAT Video Enterprises,
COMSAT RSI and COMSAT International Ventures);
President and Chief Operating Officer, COMSAT
Corporation; President, World Systems Division,
COMSAT Corporation; and Chairman, Board of
Governors of INTELSAT; (each of the COMSAT
companies listed above is an international
communication, information and
entertainment-distribution services company).
(2) Director/Trustee of the AIM Funds.
Owen Daly II (72) STIC 05/05/93 (1) Formerly, Director, CF&I Steel Corp.,
STIT 05/05/93 Monumental Life Insurance Company and
(and of its Monumental General Insurance Company; and
predecessors Chairman of the Board of Equitable
since 1986) Bancorporation. (2) Director/Trustee of the AIM
TFIC 03/05/92 Funds; and Director, Cortland Trust Inc.
(and of its (investment company).
predecessors
since 1992)
Carl Frischling (59)** STIC 05/05/93 (1) Partner, Kramer, Levin, Naftalis & Frankel
STIT 05/05/93 (law firm). Formerly, Partner, Reid & Priest
(and of its (law firm); and prior thereto, Partner,
predecessors Spengler Carlson Gubar Brodsky & Frischling
since 1980) (law firm). (2) Director/Trustee of the AIM
TFIC 03/05/92 Funds.
(and of its
predecessors
since 1992)
</TABLE>
- ---------------
** Mr. Frischling is an "interested person" of each Company, as defined in the
1940 Act, primarily because of payments received by his law firm for
services to the AIM Funds.
4
<PAGE> 9
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION/AFFILIATIONS DURING
DIRECTOR/ PAST FIVE YEARS AND (2) CURRENT
NAME (AGE) TRUSTEE SINCE DIRECTORSHIPS/TRUSTEESHIPS
- ------------------------------- --------------- -----------------------------------------------
<S> <C> <C>
Robert H. Graham (50)*** STIC 05/10/94 (1) Director, President and Chief Operating
STIT 05/05/93 Officer, A I M Management Group Inc.; Director
(and of its and President, A I M Advisors, Inc.; and
predecessors Director and Senior Vice President, A I M
since 1986) Capital Management, Inc., A I M Distributors,
TFIC 05/10/94 Inc., A I M Fund Services, Inc., A I M
Institutional Fund Services, Inc. and Fund
Management Company. (2) Director/Trustee of the
AIM Funds.
John F. Kroeger (72) STIC 05/05/93 (1) Formerly, Consultant, Wendell & Stockel
STIT 05/05/93 Associates, Inc. (consulting firm). (2)
(and of its Director/Trustee of the AIM Funds; and
predecessors Director, Flag Investors International Fund,
since 1980) Inc., Flag Investors Emerging Growth Fund,
TFIC 03/05/92 Inc., Flag Investors Telephone Income Fund,
(and of its Inc., Flag Investors Equity Partners Fund,
predecessors as Inc., Total Return U.S. Treasury Fund, Inc.,
of 1982) Flag Investors Intermediate Term Income Fund,
Inc., Managed Municipal Fund, Inc., Flag
Investors Value Builder Fund, Inc., Flag
Investors Maryland Intermediate Tax-Free Income
Fund, Inc., Flag Investors Real Estate
Securities Fund, Inc., Alex Brown Cash Reserve
Fund, Inc. and North American Government Bond
Fund, Inc. (investment companies).
Lewis F. Pennock (54) STIC 05/05/93 (1) Attorney in private practice in Houston,
STIT 05/05/93 Texas. (2) Director/Trustee of the AIM Funds.
(and of its
predecessors
since 1981)
TFIC 03/04/92
(and of its
predecessors
since 1992)
</TABLE>
- ---------------
*** Mr. Graham is an "interested person" of each Company, as defined in the 1940
Act, primarily because of his positions with AIM and its affiliated
companies, as set forth above, and through his ownership of stock of A I M
Management Group Inc., which owns all of the outstanding stock of AIM.
5
<PAGE> 10
<TABLE>
<CAPTION>
(1) PRINCIPAL OCCUPATION/AFFILIATIONS DURING
DIRECTOR/ PAST FIVE YEARS AND (2) CURRENT
NAME (AGE) TRUSTEE SINCE DIRECTORSHIPS/TRUSTEESHIPS
- ------------------------------- --------------- -----------------------------------------------
<S> <C> <C>
Ian W. Robinson (73) STIC 05/05/93 (1) Formerly, Executive Vice President and
STIT 05/05/93 Chief Financial Officer, Bell Atlantic
TFIC 12/08/92 Management Services, Inc. (provider of
centralized management services to telephone
companies); Executive Vice President, Bell
Atlantic Corporation (parent of seven telephone
companies); and Vice President and Chief
Financial Officer, Bell Telephone Company of
Pennsylvania and Diamond State Telephone
Company. (2) Director/Trustee of the AIM Funds.
Louis S. Sklar (56) STIC 05/05/93 (1) Executive Vice President, Development and
STIT 05/05/93 Operations, Hines Interests Limited Partnership
(and of its (real estate development). (2) Director/Trustee
predecessors of the AIM Funds.
since 1989)
TFIC 03/04/92
(and of its
predecessors
since 1992)
</TABLE>
------------------------------
The Companies do not hold regular annual meetings at which
Directors/Trustees are elected.
During the year ending December 31, 1996, the Companies' Boards of
Directors/Trustees met eight times. Each Company has three standing committees
of its Board of Directors/Trustees: the Audit Committee, the Investments
Committee and the Nominating and Compensation Committee. During the year ending
December 31, 1996, each Company's Audit Committee met four times, Investments
Committee met four times, and Nominating and Compensation Committee met two
times. During such year, all of the Companies' Directors/Trustees attended at
least 75% of the aggregate of the number of meetings of the Boards of
Directors/Trustees and all committees.
The members of the Audit Committee of each Company are Messrs. Daly,
Kroeger (Chairman), Pennock and Robinson. The Audit Committee for each Company
is responsible for meeting with the Company's auditors to review audit
procedures and results and to consider any matters arising from an audit to be
brought to the attention of the Directors/Trustees as a whole with respect to
the Company's fund accounting or its internal accounting controls, and for
considering such other matters as the Board of Directors/Trustees may determine.
None of the members of the Audit Committees is an "interested person" of any
Company, as defined by the 1940 Act.
The members of the Investments Committee of each Company are Messrs. Bauer,
Crockett, Daly (Chairman), Kroeger and Pennock. The Investments Committee is
responsible for reviewing portfolio compliance, brokerage allocation, portfolio
investment pricing issues, interim dividend and distribu-
6
<PAGE> 11
tion issues, and considering such other matters as the Board of
Directors/Trustees may from time to time determine. Mr. Bauer is an "interested
person" of the Companies, as defined by the 1940 Act.
The members of the Nominating and Compensation Committee of each Company
are Messrs. Crockett, Daly, Kroeger, Pennock (Chairman) and Sklar. The
Nominating and Compensation Committee is responsible for considering and
nominating individuals to stand for election as Directors/Trustees, reviewing
from time to time the compensation payable to the Directors/Trustees who are not
"interested persons" of the Companies, as defined by the 1940 Act, and
considering such other matters as the Board of Directors/Trustees may from time
to time determine. The Nominating and Compensation Committee of each Company has
sole authority to nominate persons for Directors/Trustees of such Company but
shareholders may submit names of individuals for the Committee's consideration.
None of the members of the Nominating and Compensation Committees is an
"interested person" of any Company, as defined by the 1940 Act.
COMPENSATION OF DIRECTORS/TRUSTEES
Each Director/Trustee is reimbursed for expenses incurred in attending each
meeting of the Boards of Directors/Trustees or any committee thereof. Each
Director/Trustee who is not also an officer of the Companies is compensated for
his services according to a fee schedule which recognizes the fact that such
Director/Trustee also serves as a Director/Trustee of other AIM Funds. Each such
Director/Trustee receives a fee, allocated among the AIM Funds, which consists
of an annual retainer component and a meeting fee component.
Set forth below is information regarding compensation paid or accrued
estimated for the calendar year ending December 31, 1996 for each
Director/Trustee of the Companies:
<TABLE>
<CAPTION>
RETIREMENT
AGGREGATE COMPENSATION FROM THE BENEFITS TOTAL
COMPANIES(1) ACCRUED BY COMPENSATION
-------------------------------- ALL AIM FROM ALL AIM
DIRECTOR/TRUSTEE STIC STIT TFIC FUNDS(2) FUNDS(3)
------------------------- ------ ------ ------ ---------- ------------
<S> <C> <C> <C> <C> <C>
Charles T. Bauer......... -0- -0- -0- -0- -0-
Bruce L. Crockett........ $6,952 $4,596 $1,627 $ 38,621 $ 67,000
Owen Daly II............. 6,924 4,569 1,614 82,607 67,000
Carl Frischling.......... 6,952 4,596 1,627 56,683 67,000
Robert H. Graham......... -0- -0- -0- -0- -0-
John F. Kroeger.......... 6,704 4,425 1,561 83,654 65,000
Lewis F. Pennock......... 6,814 4,497 1,588 33,702 66,000
Ian W. Robinson.......... 6,952 4,596 1,627 64,973 67,000
Louis S. Sklar........... 6,853 4,530 1,604 47,593 65,500
</TABLE>
- ------------------------------
(1) The total amount of compensation deferred by all Directors/Trustees of the
Companies estimated for the year ending December 31, 1996, including
interest earned thereon, is $29,992 for STIC, $20,375 for STIT, and $7,172
for TFIC.
(2) During the year ending December 31, 1996, the total amount of expenses
allocated to the Companies in respect of such retirement benefits is $61,452
for STIC, $33,120 for STIT, and $8,514 for TFIC.
(3) Each Director/Trustee serves as a Director/Trustee of a total of ten AIM
Funds. Data reflect estimated total compensation earned during the calendar
year ending December 31, 1996. Does not include accrued retirement benefits
or earnings on deferred compensation.
------------------------------
7
<PAGE> 12
AIM FUNDS RETIREMENT PLAN FOR ELIGIBLE DIRECTORS/TRUSTEES
Under the terms of the AIM Funds Retirement Plan for Eligible
Directors/Trustees (the "Retirement Plan"), each Director/Trustee who is an
"Eligible Director/Trustee" (as defined in the Retirement Plan) may be entitled
to certain benefits upon retirement from the Board of Directors/Trustees.
Pursuant to the Retirement Plan, the normal retirement date is the date on which
the Eligible Director/Trustee has attained age 65 and has completed at least
five years of continuous service with one or more of the AIM Funds. Each
Eligible Director/Trustee is entitled to receive an annual benefit from the AIM
Funds commencing on the first day of the calendar quarter coincident with or
following his date of retirement equal to 75% of the retainer paid or accrued by
the AIM Funds for such Eligible Director/Trustee during the twelve-month period
immediately preceding the Eligible Director/Trustee's retirement (including
amounts deferred under a separate agreement between the AIM Funds and the
Eligible Director/Trustee) for the number of such Eligible Director/Trustee's
years of service (not in excess of ten years of service) completed with respect
to any of the AIM Funds. If an Eligible Director/Trustee dies after attaining
the normal retirement date but before receipt of any benefits under the
Retirement Plan commences, the Eligible Director/Trustee's surviving spouse (if
any) shall receive a quarterly survivor's benefit equal to 50% of the amount
payable to the deceased Eligible Director/Trustee for no more than ten years
beginning the first day of the calendar quarter following the date of the
Eligible Director/Trustee's death. Payments under the Retirement Plan are not
secured or funded by any AIM Fund.
Set forth below is a table that shows the estimated annual benefits payable
to an Eligible Director/Trustee upon retirement assuming various final annual
compensation and years of service classifications. The estimated credited years
of service for Messrs. Crockett, Daly, Frischling, Kroeger, Pennock, Robinson
and Sklar are 9, 10, 19, 19, 15, 9 and 7, respectively, although, as noted
above, the benefits payable are based upon no more than ten years of service.
ESTIMATED BENEFITS UPON RETIREMENT
<TABLE>
<CAPTION>
ANNUAL COMPENSATION PAID BY ALL
AIM FUNDS
NUMBER OF YEARS OF SERVICE -------------------------------
WITH THE AIM FUNDS $55,000 $60,000 $65,000
- -------------------------- ------- ------- -------
<S> <C> <C> <C> <C>
10....................... $41,250 $45,000 $48,750
9....................... 37,125 40,500 43,875
8....................... 33,000 36,000 39,000
7....................... 28,875 31,500 34,125
6....................... 24,750 27,000 29,250
5....................... 20,625 22,500 24,375
</TABLE>
DEFERRED COMPENSATION AGREEMENTS
Messrs. Daly, Frischling, Kroeger, Robinson and Sklar (for purposes of this
paragraph only, the "Deferring Directors/Trustees") have each executed a
Deferred Compensation Agreement (collectively, the "DC Agreements"). Pursuant to
the DC Agreements, the Deferring Directors/Trustees may elect to defer receipt
of up to 100% of their compensation payable by the Companies, and such amounts
are placed into a deferral account. Currently, the Deferring Directors/Trustees
may select various AIM Funds in which all or part of their deferral accounts
shall be deemed to be invested. Distributions from the Deferring
Directors/Trustee's deferral accounts will be paid in cash generally in equal
quarterly installments over a period of ten years beginning on the date the
Deferring
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<PAGE> 13
Director/Trustee's retirement benefits commence under the Retirement Plan. The
Companies' Boards of Directors/Trustees, in their sole discretion, may
accelerate or extend the distribution of such deferral accounts after a
Deferring Director/Trustee's termination of service as a Director/Trustee of a
Company. If a Deferring Director/Trustee dies prior to the distribution of
amounts in his deferral account, the balance of the deferral account will be
distributed to his designated beneficiary in a single lump sum payment as soon
as practicable after such Deferring Director/Trustee's death. The DC Agreements
are not funded and, with respect to the payments of amounts held in the deferral
accounts, the Deferring Directors/Trustees have the status of unsecured
creditors of the Companies and of each other AIM Fund from which they are
deferring compensation.
PROPOSAL 2 --
APPROVAL OF INVESTMENT ADVISORY AGREEMENTS
INTRODUCTION
Shareholders are being asked to approve new Investment Advisory Agreements
(collectively, the "New Advisory Agreements"), that, except as discussed below
with respect to the Cash Reserve Portfolio of TFIC, have no material changes in
their terms and conditions, no changes in fees and no material changes in the
way the Funds are managed, advised or operated.
AIM has served as investment advisor to each of the Funds from the dates
set forth in Annex B and currently serves pursuant to advisory agreements
(collectively, the "Current Advisory Agreements") executed on various dates, as
set forth in Annex B. On May 14, 1996, the Board of Directors/Trustees of STIC,
STIT and TFIC, including a majority of the Directors/Trustees who are not
interested persons of each such Company or AIM (the "Independent
Directors/Trustees"), voted to continue the Current Advisory Agreements for an
additional year until June 30, 1997.
The Funds are seeking shareholder approval of the New Advisory Agreements
because of the technical requirements of the 1940 Act that apply to the merger
(the "Merger") described below under "Merger of AIM Management and INVESCO."
Because the Merger will result in a transfer of more than 25% of the outstanding
voting shares of A I M Management Group Inc. ("AIM Management"), the direct
parent of AIM, an "assignment" of the Current Advisory Agreements will occur
under the 1940 Act. The Current Advisory Agreements provide that they will
terminate automatically upon their assignment, as required by the 1940 Act. As
discussed below, the Merger will not cause any change in the operation of AIM's
business.
At a meeting held on December 10 and 11, 1996, the Board of
Directors/Trustees of STIC, STIT and TFIC, including a majority of the
Independent Directors/Trustees, approved, subject to shareholder approval, the
New Advisory Agreements. A copy of a form of the New Advisory Agreements is
attached hereto as Annex C. In approving the New Advisory Agreements, the Boards
of Directors/Trustees took into account the terms of the Merger. Except as
discussed below with respect to the Cash Reserve Portfolio of TFIC, there are no
material differences between the provisions of the Current Advisory Agreements
and the New Advisory Agreements. A description of such agreements is provided
below under "Terms of the Advisory Agreements." Such description is only a
summary and is qualified by reference to the attached Annex C.
9
<PAGE> 14
If the conditions to the Merger are not met or waived or if the merger
agreement between AIM Management and INVESCO is terminated, the Merger will not
be consummated, and the Current Advisory Agreements will remain in effect. If
the New Advisory Agreements are approved, and the Merger is thereafter
consummated, the New Advisory Agreements will be executed and become effective
on the Closing Date, as defined below. In the event that any of the New Advisory
Agreements is not approved with respect to any Fund and the Merger is
consummated, the Board of Directors/Trustees of the applicable Company will
determine what action to take, in any event subject to the approval of
shareholders of such Fund.
MERGER OF AIM MANAGEMENT AND INVESCO
On November 4, 1996, AIM Management (the parent of AIM) entered into an
agreement and plan of merger (the "Merger Agreement") with INVESCO plc
("INVESCO"). The Merger Agreement provides for the merger of AIM Management into
INVESCO Group Services, Inc., a wholly owned U.S. subsidiary of INVESCO, or into
another wholly owned U.S. subsidiary of INVESCO (in either case, "INVESCO Sub").
INVESCO is an English holding company whose shares are publicly traded on
the London Stock Exchange. American Depositary Shares evidencing such shares are
traded on the New York Stock Exchange. INVESCO and its subsidiaries are an
independent investment management group with a major presence in the
institutional investment management and retail mutual fund businesses in the
United States and Europe, and a growing presence in the Pacific. INVESCO's U.S.
subsidiaries manage individualized investment portfolios of equity, fixed income
and real estate securities for institutional clients through five business
units. Each unit utilizes a particular investment style in managing assets, and
most of these units also serve as advisor or sub-advisor to one or more of
INVESCO's U.S. mutual funds. INVESCO's European region serves both institutional
and individual investors through six major business units with facilities in the
United Kingdom, the Channel Islands, Luxembourg and France. INVESCO has also
established relationships with substantial financial organizations in Italy, the
Netherlands, Spain and Portugal. INVESCO's Pacific region manages assets of
clients based in Asia and Australia on a local, regional or global basis. It
also manages investments in the region for INVESCO clients based outside the
region. At September 30, 1996, INVESCO's assets under management were in excess
of $90 billion.
Following the Merger, INVESCO will be renamed AMVESCO, plc ("AMVESCO").
AMVESCO will consist of two major complementary businesses, one comprising
principally its United States institutional and international businesses, and
the other comprising principally its United States retail mutual fund and
defined contribution plan businesses. Each of these businesses will be directed
by a separate management committee. Charles W. Brady, the Chairman of INVESCO,
will head the management committee for AMVESCO's U.S. institutional and
international businesses. Robert H. Graham, President and Chief Operating
Officer of AIM Management, will become President and Chief Executive Officer of
AIM Management's successor and will head the management committee directing
AMVESCO's United States retail businesses. Charles T. Bauer, currently Chairman
and Chief Executive Officer of AIM Management, will become Vice Chairman of
AMVESCO and Chairman of AIM Management's successor. AIM Management and INVESCO
believe that their businesses are highly complementary and that the expected
benefits resulting from the Merger include broader product range, expanded
distribution capability, increased globalization, greater capacity in defined
contribution plans, and increased financial strength and independence.
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<PAGE> 15
AIM has advised the AIM Funds that the Merger is not expected to have a
material effect on the operations of the AIM Funds or on their shareholders. No
material change in investment philosophy, policies or strategies is currently
envisioned. Following the Merger, AIM will continue to be a wholly owned
subsidiary of the successor to AIM Management. The Merger Agreement does not, by
its terms, contemplate any changes, other than changes in the ordinary course of
business, in the management or operation of AIM relating to the AIM Funds, the
personnel managing the AIM Funds or other services provided to and business
activities of the AIM Funds. The Merger also is not expected to result in
material changes in the business, corporate structure or composition of the
senior management or personnel of AIM. Based on the foregoing, AIM does not
anticipate that the Merger will cause a reduction in the quality of services
provided to the AIM Funds, or have any adverse effect either on AIM's ability to
fulfill its respective obligations under the New Advisory Agreements, or on its
ability to operate its businesses in a manner consistent with its current
practices.
Under the Merger Agreement, each of INVESCO and INVESCO Sub has covenanted
and agreed that it will comply, and use all reasonable efforts to cause
compliance on behalf of its affiliates, with the provisions of Section 15(f) of
the 1940 Act. Section 15(f) provides, in pertinent part, that an investment
advisor and its affiliates may receive any amount of benefit in connection with
a sale of securities of, or a sale of any other interest in, such investment
advisor that results in an "assignment" of an investment advisory contract as
long as two conditions are met. First, no "unfair burden" may be imposed on the
investment company as a result of the Merger. The term "unfair burden," as
defined in the 1940 Act, includes any arrangement during the two-year period
after the transaction whereby the investment advisor (or predecessor or
successor investment advisor) or any interested person of any such advisor
receives or is entitled to receive any compensation directly or indirectly from
the investment company or its security holders (other than fees for bona fide
investment advisory or other services) or from any person in connection with the
purchase or sale of securities or other property to, from, or on behalf of the
investment company (other than fees for bona fide principal underwriting
services). No such compensation arrangements are contemplated in connection with
the Merger.
The second condition is that, for a period of three years after the
transaction occurs, at least 75% of the members of the board of directors of the
investment company advised by such advisor are not "interested persons" (as
defined in the 1940 Act) of the new or the old investment advisor. The Board of
Directors/Trustees that you are being asked to elect in Proposal No. 1 meets
this 75% requirement.
BOARDS OF DIRECTORS/TRUSTEES EVALUATION
At meetings with the Boards of Directors/Trustees of the AIM Funds
beginning in September, 1996, representatives of AIM Management began discussing
with the Boards the possibility of a merger between AIM Management and INVESCO.
At a meeting in person held on September 27 and 28, 1996, the Boards of
Directors/Trustees of the AIM Funds appointed a special committee (the "Special
Committee") consisting of the Directors/Trustees of the AIM Funds who are not
interested persons of AIM or INVESCO, to review the proposed Merger, consider
its potential impact on the AIM Funds and their shareholders, and make
recommendations to the Boards of Directors/Trustees of the AIM Funds with
respect to the approval of the New Advisory Agreements in view of the proposed
Merger. Directors/Trustees of the AIM Funds who are members of the Special
Committee are Messrs. Crockett, Daly, Frischling, Kroeger, Pennock, Robinson and
Sklar. The Special Committee met with its legal counsel ("Special Counsel"), who
assisted it in its deliberations concerning approval of the New Advisory
Agreements. At a meeting in person held on November 19, 1996,
11
<PAGE> 16
representatives of AIM Management and INVESCO discussed with the Boards of
Directors/Trustees of the AIM Funds the specific terms of the Merger Agreement.
The Special Committee met separately with Special Counsel on November 8,
1996, November 19, 1996, and December 2, 1996 to consider and review the
Directors'/Trustees' fiduciary obligations and the nature and extent of
additional information to be requested by them to evaluate the New Advisory
Agreements and the potential impact of the Merger on the AIM Funds and their
shareholders. Between November 8, 1996 and December 10, 1996, the Special
Committee and Special Counsel requested and received additional information from
AIM Management, INVESCO and their counsel, and held telephone conferences,
regarding the proposed Merger and its potential impact on the AIM Funds and
their shareholders. On December 10, 1996, the Special Committee and Special
Counsel met separately with representatives of AIM Management and INVESCO to
review various aspects of the proposed Merger, and to review additional
information regarding INVESCO and the future plans for AIM Management and AIM.
In connection with its review, the Special Committee possessed or obtained
substantial information regarding: the management, financial position and
business of INVESCO and its subsidiaries; the history of INVESCO's and its
subsidiaries' business and operations; the performance of the investment
companies and private accounts advised by INVESCO and its subsidiaries; the
impact of the Merger on the AIM Funds and their shareholders; future plans of
AMVESCO with respect to AIM and the AIM Funds; performance and financial
information about each of the AIM Funds; and information about other funds and
their fees and expenses.
The Special Committee also received information regarding the terms of the
Merger and comprehensive financial information, including: INVESCO's plans for
financing the Merger; the impact of the financing on AIM Management and AIM;
AMVESCO's plans for the compensation of executives and investment and other
staff of AIM Management and AIM; information concerning employment contracts
with senior management of AIM Management and AIM; and AMVESCO's access to
capital markets to meet the capital needs of AIM Management and its
subsidiaries.
In connection with its deliberations, the Special Committee obtained
assurances from INVESCO that: the separate identity of AIM Management and AIM
would be maintained for the foreseeable future; AMVESCO did not intend to change
executive management or staff of AIM Management or AIM (other than to appoint
Robert H. Graham Chief Executive Officer of the successor to AIM Management),
and has entered into employment agreements with key personnel; AMVESCO will
consult with the Boards of Directors/Trustees of the AIM Funds prior to making
material changes to AIM, including its financial and personnel resources, that
could adversely affect the ability of AIM or its subsidiaries to render high
quality services to the AIM Funds; AMVESCO will appoint a general counsel for
AMVESCO who will have responsibility for overall compliance systems; neither
AMVESCO nor its affiliates will impose an "unfair burden" within the meaning of
Section 15(f) of the 1940 Act for a period of two years following the
consummation of the Merger; AMVESCO has not planned any major changes to the
operations and capabilities of AIM or its subsidiaries, except those intended to
enhance the capabilities of those entities to provide improved services to the
AIM Funds; and AMVESCO and its affiliates will use reasonable best efforts to
assure that for a period of three years following consummation of the Merger at
least 75% of the members of the Boards of Directors/Trustees of the AIM Funds
will not be interested persons of either AIM or INVESCO Group Services, Inc. The
Special Committee determined that it was not in a position to rank the foregoing
in order of importance.
12
<PAGE> 17
The Special Committee also evaluated each New Advisory Agreement. The
Special Committee assured itself that the New Advisory Agreement for each of the
Funds, including the terms relating to the services to be provided and the fees
and expenses payable by each such Fund, is not materially different from the
Current Advisory Agreement for each such Fund, except to the extent described
below with respect to the Cash Reserve Portfolio of TFIC.
Based on the Special Committee's review and analysis of the material
provided and the assurances received, the Special Committee unanimously
recommended to the Boards of Directors/Trustees of each of the Companies that
the New Advisory Agreements be approved.
At the Boards of Directors/Trustees meetings of the AIM Funds held on
December 10 and 11, 1996, the Boards received presentations by INVESCO and AIM.
The Directors/Trustees were supplied with the information given to the Special
Committee in advance of the meeting. The Special Committee discussed with the
Boards of Directors/Trustees the materials it reviewed, the issues it studied
and the reasons for its recommendation. Based upon the foregoing, the Board of
Directors/Trustees of each of the Companies unanimously approved the New
Advisory Agreement for the applicable Funds and recommended approval by the
shareholders.
ADDITIONAL TERMS OF THE MERGER AGREEMENT
AIM Management will merge into INVESCO Sub for consideration valued at
November 4, 1996 at approximately $1.6 billion, plus the amount of AIM
Management net income from September 1, 1996 through the date on which the
Merger is consummated (the "Closing Date"), minus dividends paid during such
period and subject to adjustments for certain balance sheet items and
transaction expenses. The consideration will include 290 million new Ordinary
Shares (including Ordinary Shares issuable in respect of vested and unvested AIM
Management options) of INVESCO valued at November 4, 1996 at approximately $1.1
billion. The balance of the consideration will be paid in cash.
The directors of AIM Management's successor will be Charles T. Bauer,
Robert H. Graham, Gary T. Crum and Michael J. Cemo, all of whom are currently
officers and directors of AIM Management. Although Charles T. Bauer will remain
Chairman of AIM Management's successor, Robert H. Graham will become President
and Chief Executive Officer of such successor. Mr Graham currently serves as AIM
Management's President and Chief Operating Officer.
Upon consummation of the Merger, the AIM Management stockholders will own
approximately 45% of INVESCO's total outstanding capital stock on a fully
diluted basis. INVESCO's shareholders approved the Merger at a meeting on
November 27, 1996, and on December 4, 1996 approved changing INVESCO's name upon
consummation of the Merger. AIM Management's stockholders have also approved the
Merger. The name of AIM will not change.
The closing is presently expected to occur on February 28, 1997, subject to
the satisfaction of conditions to closing that include, among other things: (a)
INVESCO having consummated one or more financings and having received net
proceeds of not less than $500 million; (b) the respective aggregate annualized
asset management fees of INVESCO and AIM Management (based on assets under
management, excluding the effects of market movements) in respect of which
consents to the Merger have been obtained being equal to or greater than 87.5%
of all such fees at October 31, 1996; (c) INVESCO and AIM Management having
received certain consents from regulators, lenders and/or other third parties;
(d) AIM Management not having received from the holder or holders of more than
2% of the outstanding AIM Management shares notices that they intend to exercise
13
<PAGE> 18
dissenters' rights; (e) a Voting Agreement, Standstill Agreement, Transfer
Administration Agreement, Registration Rights Agreement and Indemnification
Agreement, and Transfer Restriction Agreements and Employment Agreements with
certain AIM Management employees having been executed and delivered; (f) AIM
Management having received an opinion from its U.S. counsel that the Merger will
be treated as a tax-free reorganization; and (g) shareholder resolution to
appoint to INVESCO's Board of Directors six AIM Management designees and a Board
resolution to appoint the seventh AIM Management designee having been passed and
not revoked.
The Merger Agreement may be terminated at any time prior to the Closing
Date (a) by written agreement of INVESCO and AIM Management, (b) by written
notice by AIM Management or INVESCO to the other after June 1, 1997 or (c) under
other circumstances set forth in the Merger Agreement. In certain circumstances
occurring on or before September 30, 1997, a termination fee will be payable by
the party in respect of which such circumstances have occurred.
In connection with the Merger, the following agreements, each to be
effective upon the closing of the Merger, have been or will be executed:
Employment Agreements. Following the Merger, the current officers of
AIM Management will be the officers of the successor to AIM Management and
the directors of the successor to AIM Management will be four of the
current directors of AIM Management. Senior management and key employees of
AIM Management have entered into employment agreements which will commence
when the Merger is consummated and will continue for initial terms ranging
from one year to four years. All of the employment agreements contain
covenants not to compete extending for at least one year after termination
of employment. Approximately thirty current employees of AIM Management are
expected to enter into such employment agreements with INVESCO.
Voting Agreement. Certain AIM Management stockholders and their
spouses, the current directors of INVESCO and proposed directors of AMVESCO
(all of whom are expected to hold in the aggregate approximately 25% of the
Ordinary Shares outstanding immediately following the consummation of the
Merger) have agreed to vote as directors and as shareholders to ensure
that: (a) the AMVESCO Board will have fifteen members, consisting of four
executive directors and three non-executive directors designated by
INVESCO's current senior management, four executive directors and three
non-executive directors designated by AIM Management's current senior
management and a Chairman; (b) the initial Chairman will be Charles W.
Brady (INVESCO's current Chairman) and the initial Vice Chairman will be
Charles T. Bauer (AIM Management's current Chairman); (c) the parties will
vote at any AMVESCO shareholder meeting on resolutions (other than those in
respect of the election of directors) supported by two-thirds of the Board
in the same proportion as votes are cast by unaffiliated shareholders. The
Voting Agreement will terminate on the earlier of the fourth anniversary of
the Closing Date and the date on which a resolution proposed by an
INVESCO-designated Board member is approved by the AMVESCO Board despite
being voted against by each AIM Management-designated Board member present
at such Board meeting.
Standstill Agreement and Transfer Restriction Agreements. Certain AIM
Management stockholders and their spouses and certain other significant
shareholders of INVESCO have agreed under certain circumstances for a
maximum of five years not to engage in a number of specified activities
that might result in a change of the ownership or control positions of
AMVESCO existing as of the Closing Date. AIM Management stockholders and
INVESCO's
14
<PAGE> 19
current chairman will be restricted in their ability to transfer their
shares of AMVESCO for a period of up to five years.
TERMS OF THE ADVISORY AGREEMENTS
Although the Current Advisory Agreements have not terminated and the New
Advisory Agreements have not become effective, such Agreements (collectively,
the "Advisory Agreements") are described below as if they were both in effect.
Under the Advisory Agreements, AIM
(a) supervises all aspects of the operations of the Funds;
(b) obtains and evaluates pertinent information about significant
developments and economic, statistical and financial data, domestic,
foreign or otherwise, whether affecting the economy generally or the Funds,
and whether concerning the individual issuers whose securities are included
in the assets of the Funds or the activities in which such issuers engage,
or with respect to securities which AIM considers desirable for inclusion
in the Funds' assets;
(c) determines which issuers and securities shall be represented in
the Funds' investment portfolios and regularly reports thereon to the
Companies' Boards of Directors/Trustees.
(d) formulates and implements continuing programs for the purchases
and sales of the securities of such issuers and regularly reports thereon
to the Companies' Boards of Directors/Trustees; and
(e) takes, on behalf of the Companies and the Funds, all actions which
appear to the Companies and the Funds necessary to carry into effect such
purchase and sale programs and supervisory functions stated above,
including but not limited to the placing of orders for the purchase and
sale of securities for the Funds.
The Advisory Agreements provide that any investment program undertaken by
AIM, as well as any other actions taken by AIM on behalf of each Fund, shall at
all times be subject to any directives of the Board of Directors/Trustees of the
applicable Company.
In performing its obligations under the Advisory Agreements, AIM is
required to comply with all applicable laws. Each of the New Advisory
Agreements, as well as each of the Current Advisory Agreements for STIC and
STIT, provide that, in the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties under such Advisory
Agreements on the part of AIM or its officers, directors or employees, AIM shall
not be liable to the Companies or the Funds or their shareholders for any act or
omission in the course of, or connected with, rendering services hereunder or
for any losses that may be sustained in the purchase, holding or sale of any
security.
Each of the New Advisory Agreements, as well as each of the Current
Advisory Agreements for STIC and STIT, provide that, subject to the approval of
the Board of Directors/Trustees of the applicable Company and the shareholders
of the applicable Fund, AIM may delegate certain of its duties to a sub-advisor,
provided that AIM shall continue to supervise the performance of any such
sub-advisor.
The Advisory Agreements provide that all of the ordinary business expenses
incurred in the operations of each of the Funds and the offering of each of
their shares shall be paid by each such
15
<PAGE> 20
Fund. These expenses include brokerage commissions, taxes, legal, accounting,
auditing or governmental fees, custodian, transfer agent and shareholder service
agent costs.
The New Advisory Agreement also expressly provides that a Company shall be
entitled to use the name "AIM" with respect to a Fund only so long as AIM serves
as investment manager or advisor to such Fund. Although some of the Current
Advisory Agreements presently have a similar provision, the provision in each of
the New Advisory Agreements will read as follows:
Licensing Agreement. The Company shall have the non-exclusive right to
use the name "AIM" to designate any current or future series of shares
only so long as A I M Advisors, Inc. serves as investment manager or
advisor to the Company with respect to such series of shares.
Management of each Company understands that to the extent each such Company
has been using the AIM mark for each Fund, it has done so only by permission of
AIM and that the express licensing provision contained in each New Advisory
Agreement clarifies this understanding.
Information with regard to the fees payable under each of the Advisory
Agreements and the aggregate advisory fees paid to AIM in each Fund's most
recently completed fiscal year is set forth in Annex F.
Each Advisory Agreement may be terminated with respect to a Fund on 60
days' written notice without penalty by (i) the applicable Fund, (ii) the action
of the shareholders of the applicable Fund, (iii) Board of Directors/Trustees of
the applicable Company, or (iv) AIM. Each Advisory Agreement will terminate
automatically in the event of any assignment, as defined by the 1940 Act. The
Advisory Agreements continue from year to year with respect to a Fund so long as
their continuance is specifically approved at least annually either (i) by the
Board of Directors/Trustees of the applicable Company or (ii) by the vote of a
majority of such Fund's outstanding voting securities, as defined by the 1940
Act, provided that in either event the continuance is also approved by the vote
of a majority of the Directors/Trustees of the Company who are not interested
persons of the Company or of AIM, cast in person at a meeting called for the
purpose of voting on such approval.
The Advisory Agreements for the portfolios of STIC and STIT provide that,
upon the request of the applicable Company's Boards of Directors/Trustees, AIM
may perform certain additional services on behalf of the Funds. The Boards of
Directors/Trustees have approved, and STIC and STIT have entered into, Master
Administrative Services Agreements with AIM, pursuant to which AIM has agreed to
provide or arrange for the provision of certain accounting and other
administrative services to each portfolio of STIC and STIT, including the
services of a principal financial officer of each such Company and related
staff. As compensation to AIM for its services under the Master Administrative
Services Agreements, the Funds reimburse AIM for expenses incurred by AIM or its
affiliates in connection with such services.
The following two paragraphs apply only to TFIC: There are several
differences between the Current Advisory Agreement and the New Advisory
Agreement for the Cash Reserve Portfolio of TFIC. None of these differences will
result in any change to the expenses currently borne by TFIC. Both Advisory
Agreements provide that AIM's services to TFIC are not exclusive and that AIM
may act as investment advisor to others, but the Current Advisory Agreement
further provides that AIM may do so only if its services under the Current
Advisory Agreement are not impaired thereby. The New Advisory Agreement provides
that AIM will not be liable to TFIC in the absence of willful
16
<PAGE> 21
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties, whereas the Current Advisory Agreement affirmatively
requires AIM to exercise care and diligence, to act in good faith and to use its
best efforts within reasonable limits to insure the accuracy of its services,
and holds AIM responsible for its negligent failure to perform its duties. The
New Advisory Agreement provides that AIM may delegate its responsibilities to a
sub-advisor, subject to approval by TFIC's Board of Directors and the
shareholders. Both Advisory Agreements permit AIM to allocate brokerage to
broker-dealers that provide AIM with research services and to consider such
services in evaluating the reasonableness of commissions charged by such
broker-dealers, but the Current Advisory Agreement only permits AIM to consider
how such services benefit TFIC, whereas the New Advisory Agreement permits AIM
to consider how such services benefit TFIC, other AIM Funds or any of AIM's
other advisory clients. In addition, the New Advisory Agreement also permits AIM
to consider research services provided to a sub-advisor in allocating brokerage.
Under the Current Advisory Agreement with the Cash Reserve Portfolio of
TFIC, AIM may, at the request of the Board of Directors, perform additional
services on behalf of the Fund which are not required by its Current Advisory
Agreement, and may charge the Fund for rendering such services. Pursuant to this
provision, AIM currently provides fund accounting services to TFIC, and TFIC
pays AIM for such services. To date, TFIC has not entered into a Master
Administrative Services Agreement with AIM for the provision of accounting,
shareholder services or other administrative services. The Fund's New Advisory
Agreement will specifically permit AIM, upon the request of TFIC's Board of
Directors, to perform (or arrange for the performance of) such services, and for
the Fund to reimburse AIM for the cost of, or reasonable compensation for, such
services. If the New Advisory Agreement is approved, TFIC intends to enter into
a Master Administrative Services Agreement with AIM to provide such services to
the Fund. Payments to AIM under the Master Administrative Services Agreement
will be the same as payments currently made by the Fund to AIM for fund
accounting services. As a result, the Master Administrative Services Agreement
between TFIC and AIM will not change the expenses paid by the Fund. Shareholders
of the Cash Reserve Portfolio of TFIC are therefore being asked to approve a New
Advisory Agreement that specifically provides for the performance of accounting,
shareholder servicing and other administrative services on behalf of the Fund.
ADDITIONAL SERVICES PROVIDED BY AIM AND ITS AFFILIATES
As noted above, AIM provides administrative services to each of the Funds.
Fund Management Company ("Fund Management"), a wholly owned subsidiary of AIM,
serves as the principal underwriter for each of the classes of the Funds. The
classes of the Funds are sold primarily to institutional investors
("institutional classes"). The Directors/Trustees of the Companies have adopted
distribution plans for certain classes of the Funds (the "Plans") pursuant to
Rule 12b-1 under the 1940 Act. The Plans provide that the Funds may compensate
Fund Management in connection with the distribution of the shares of such
classes and the provision of ongoing services to shareholders of each class. The
fees are calculated as a percentage of the annualized average daily net assets
of the Funds attributable to a class of shares. The amount of compensation
varies in accordance with the level of services provided by Fund Management to
the Funds. Of the compensation paid to Fund Management under the Plans, a
service fee may be paid to dealers and other financial institutions that provide
continuing personal shareholder services to their customers who purchase and own
shares of the institutional classes in amounts based on the annualized average
daily net assets of the Funds attributable to the customers of such dealers or
financial institutions. Each such Fund
17
<PAGE> 22
categorizes the first 0.25% per year of the Rule 12b-1 fees that it pays to Fund
Management as a service fee for ongoing personal services. Any amount it may pay
to Fund Management in excess of such amount is characterized as an asset-based
sales charge. The Plans also impose a cap on the total amount of sales charges,
including asset-based sales charges, that may be paid by the Funds.
The Plans do not obligate the Funds to reimburse Fund Management for the
actual expenses Fund Management may incur in fulfilling its obligations under
the Plans on behalf of the Funds. Thus, under the Plans, even if Fund
Management's actual expenses exceed the fee payable to Fund Management
thereunder at any given time, the Funds will not be obligated to pay more than
that fee. If Fund Management's expenses are less than the fee it receives, Fund
Management will retain the full amount of the fee.
A I M Institutional Fund Services, Inc. ("AIM Institutional"), a wholly
owned subsidiary of AIM, serves as transfer agent to each of the Funds.
Information with regard to the amount of fees paid by each Fund to AIM and
its affiliates for services provided other than under the Current Advisory
Agreements in each Fund's most recently completed fiscal year is set forth in
Annex D.
The agreements pursuant to which AIM provides administrative services to
the Funds and pursuant to which Fund Management serves as the Funds' principal
underwriter will terminate as a result of the Merger. The Board of
Directors/Trustees of each of the Companies has approved new agreements, which
are substantially identical to the existing administrative services and
distribution agreements, to take effect upon consummation of the Merger. Under
the 1940 Act, such agreements do not require the approval of shareholders before
they become effective. The agreements pursuant to which AIM Institutional
provides transfer agency services will not terminate as a result of the Merger.
INFORMATION CONCERNING AIM
AIM serves as the investment advisor to each of the Funds. AIM was
organized in 1976 and, together with its affiliates, advises 38 investment
company portfolios constituting the AIM Funds and sub-advises one investment
company portfolio. As of December 3, 1996, the total assets of the AIM Funds
were approximately $62.6 billion. AIM is a wholly owned subsidiary of AIM
Management. Certain of the Directors and officers of AIM are also
Directors/Trustees and executive officers of the Companies, and their names,
principal occupations and affiliations are shown in the table under Proposal 1
and under "Executive Officers" in Annex E. Information regarding the AIM Funds,
including their total net assets and the fees received by AIM from such AIM
Funds for its services, is set forth in Annex F. The address of AIM, all of the
Directors of AIM, Fund Management, AIM Institutional and AIM Management, is 11
Greenway Plaza, Suite 1919, Houston, Texas 77046-1173.
RECOMMENDATION OF DIRECTORS/TRUSTEES
The Board of Directors/Trustees of each Company recommends that you vote
FOR the approval of the New Advisory Agreement.
18
<PAGE> 23
PROPOSAL 3 --
ELIMINATION OF THE FUNDAMENTAL INVESTMENT
POLICY PROHIBITING OR RESTRICTING INVESTMENTS IN OTHER
INVESTMENT COMPANIES AND/OR AMENDMENT OF CERTAIN RELATED
FUNDAMENTAL INVESTMENT POLICIES
The Boards of Directors/Trustees of the Companies propose the elimination
and, for certain Funds, the modification of certain fundamental investment
policies that prohibit or restrict the Funds from investing in other investment
companies. The specific changes proposed are described below.
Set forth below is each Fund's current fundamental investment policy
prohibiting investments in other investment companies.
<TABLE>
<CAPTION>
POLICY ON INVESTMENTS IN
COMPANY/FUND OTHER INVESTMENT COMPANIES
- ----------------------------------- --------------------------------------------------------
<S> <C>
STIC
Liquid Assets Portfolio............ Fund may not acquire for value the securities of any
other investment company, except in connection with a
merger, consolidation or acquisition of assets and
except for the investment in such securities of funds
representing compensation otherwise payable to its
directors pursuant to any deferred compensation plan
existing at any time between the (Company) and its
directors.
Prime Portfolio.................... Fund may not acquire for value the securities of any
other investment company, except in connection with a
merger, consolidation, reorganization or acquisition of
assets.
STIT
Treasury Portfolio................. Fund may not acquire for value the securities of any
other investment company, except in connection with a
merger, consolidation, reorganization or acquisition of
assets.
Treasury TaxAdvantage Portfolio.... Fund may not acquire for value the securities of any
other investment company, except in connection with a
merger, consolidation, reorganization or acquisition of
assets.
TFIC
Cash Reserve Portfolio............. Fund will not invest in shares of any other investment
company, other than in connection with a merger,
consolidation, reorganization or acquisition of assets,
except that the Fund may invest up to 10% of its assets
in securities of other investment companies and then
only for temporary purposes in those investment
companies whose dividends are tax-exempt; provided that
the Fund will not invest more than 5% of its assets in
securities of any investment company nor purchase more
than 3% of the outstanding voting stock of any
investment company.
</TABLE>
Section 12 of the 1940 Act generally prohibits each Fund from (i) owning
more than 3% of the total outstanding voting stock of any other investment
company; (ii) investing more than 5% of its total assets in the securities of
any one other investment company; and (iii) investing more than 10% of its total
assets (in the aggregate) in the securities of other investment companies.
The Boards of Directors/Trustees may, in the near future, authorize AIM and
the Companies to seek exemptive relief from the Securities and Exchange
Commission ("SEC") to permit the Funds to
19
<PAGE> 24
purchase securities of other investment companies in excess of the limitations
imposed by Section 12 of the 1940 Act (exemptive orders granted with respect to
such Funds are referred to herein collectively as the "Exemptive Orders"). There
is no assurance that such Exemptive Orders will be granted. The investment
companies in which the Funds may invest pursuant to the Exemptive Orders are
referred to herein collectively as the "Exemptive Order Funds." In order to take
full advantage of the exemptive relief that may be granted by the SEC and to
invest in shares of the Exemptive Order Funds in excess of the percentage
limitations imposed by Section 12, each such Fund is seeking shareholder
approval to eliminate the prohibition or restriction against investing in other
investment companies.
The Companies and AIM may seek Exemptive Orders because they believe each
Fund can effectively invest in certain other types of securities through pooled
investment vehicles such as the Exemptive Order Funds. By pooling their
investments in such securities, the Funds may have the ability to invest in a
wider range of issuers, industries and markets, thereby seeking to decrease
volatility and risk while at the same time providing greater liquidity than a
Fund would have available to it investing in such securities by itself. Pooling
investments may also allow the Funds to increase the efficiency of portfolio
management by permitting each Fund's portfolio manager to concentrate on those
investments that constitute the bulk of the Fund's assets and not spend a
disproportionate amount of time on specialized areas. The Companies may seek
Exemptive Orders to permit, among other things, investments by the Funds for
cash management purposes in other money market funds advised by AIM or
implementation of a master/feeder fund structure.
If the proposed elimination of each Fund's prohibitions or restrictions
against investments in other investment companies is approved, each such Fund
may invest in securities of an Exemptive Order Fund only to the extent
consistent with the Fund's investment objectives and policies as set forth from
time to time in each Company's registration statement.
In connection with obtaining Exemptive Orders, AIM may agree to waive fees
applicable to the Funds to the extent that assets of the Funds are invested in
Exemptive Order Funds, and to collect fees from the Exemptive Order Funds. Other
expenses incurred by the Exemptive Order Funds (such as audit and custodial
fees) will be borne by them, and thus indirectly by the Funds. AIM believes that
these indirect expenses will be offset by the benefits to the Funds of pooling
their investments.
CERTAIN RELATED FUNDAMENTAL INVESTMENT POLICIES
Some of the Funds currently have other fundamental investment restrictions
that may prohibit each such Fund from taking full advantage of the Exemptive
Orders. These fundamental restrictions may include one or more of the following:
1. Diversification. Each Fund of STIC and TFIC and the Treasury Portfolio
of STIT are prohibited from investing more than 5% of their assets in
securities of a single issuer (other than obligations of the U.S.
Government, its agencies or instrumentalities) except as permitted by
Rule 2a-7 under the 1940 Act. This restriction only applies to TFIC with
respect to 75% of its total assets.
2. Control. TFIC is prohibited from making investments for the purpose of
exercising control or participation in management. The 1940 Act deems a
person to have presumptive control over another person if it
beneficially owns more than 25% of the other person's voting securities.
20
<PAGE> 25
From time to time, such Funds may desire to (i) invest more than 25% of
their total assets in one or more Exemptive Order Funds, or (ii) own more than
25% of the voting securities of one or more Exemptive Order Funds.
The foregoing restrictions may be worded differently from Fund to Fund, but
the substance of the restrictions is as set forth above. Additional information
regarding a Fund's fundamental investment restrictions may be obtained without
cost by telephoning AIM at 1-800-659-1005 and requesting a copy of the Fund's
Statement of Additional Information.
In order to take full advantage of the Exemptive Orders, each Fund subject
to one or more of the foregoing investment restrictions seeks shareholder
approval to amend such restrictions by adding the following exception to each
restriction:
..., except that the [name of the applicable Fund] may purchase
securities of other investment companies to the extent permitted by
applicable law or exemptive order.
The elimination of the fundamental investment policy prohibiting or
restricting investments in other investment companies and/or the amendments to
the related fundamental investment policies would become effective March 1,
1997, if approved by shareholders at the Annual Meeting. These changes are not
related to the Merger described in Proposal 2. Shareholders are being asked to
consider such amendments at this time because the Companies do not regularly
hold annual shareholder meetings, and AIM believes that submitting this proposal
together with Proposal 2 may reduce the expenses incurred by each Fund in
connection with soliciting approval of this proposal, because the Companies will
not be required to hold a separate meeting.
RECOMMENDATION OF DIRECTORS/TRUSTEES
The Board of Directors/Trustees of each Company recommends that you vote
FOR the proposal to eliminate the fundamental investment policy prohibiting or
restricting investments in other investment companies and/or to amend certain
related fundamental investment policies.
PROPOSAL 4 --
RATIFICATION OF SELECTION OF
KPMG PEAT MARWICK LLP AS INDEPENDENT ACCOUNTANTS
The Board of Directors/Trustees of each of STIC, STIT and TFIC, including a
majority of the Independent Directors/Trustees, has selected KPMG Peat Marwick
LLP as independent accountants for the fiscal year of the Funds ending in 1997
to examine and verify the accounts and securities of the Funds, and to report
thereon to the Boards and the shareholders. This selection will be submitted for
ratification at the Annual Meeting. A representative of KPMG Peat Marwick LLP is
expected to be present at the Annual Meeting.
RECOMMENDATION OF DIRECTORS/TRUSTEES
The Board of Directors/Trustees of each of STIC, STIT and TFIC recommends
that you vote FOR the ratification of the selection of KPMG Peat Marwick LLP as
each such Company's independent accountants.
21
<PAGE> 26
GENERAL INFORMATION
EXECUTIVE OFFICERS OF EACH OF THE COMPANIES
Information regarding the executive officers of each of the Companies is
set forth in Annex E.
SECURITY OWNERSHIP OF MANAGEMENT AND 5% HOLDERS
Information regarding ownership of each class of the Funds' shares by
Directors/Trustees and the Chief Executive Officer and by 5% holders of each
class of such Fund is set forth in Annex G.
PROXY SOLICITATION
The Companies have engaged the services of Shareholder Communications
Corporation ("SCC") to assist them in the solicitation of proxies for the Annual
Meeting. It is estimated that the aggregate cost of SCC's services will be
approximately $3,500,000. The cost of soliciting proxies will be borne primarily
by AIM Management and certain incremental costs will be borne by the AIM Funds.
The Companies expect to solicit proxies principally by mail, but the Companies
or SCC may also solicit proxies by telephone, facsimile or personal interview.
AIM Management may also reimburse firms and others for their expenses in
forwarding solicitation materials to the beneficial owners of shares of the
Funds.
SHAREHOLDER PROPOSALS
As a general matter, each Company does not hold regular annual meetings of
shareholders. Any shareholder who wishes to submit proposals for consideration
at a shareholders' meeting should send such proposal to the applicable Company
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.
OTHER BUSINESS
The management knows of no business to be presented to the Annual Meeting
other than the matters set forth in this proxy statement.
By order of the Boards of Directors/Trustees,
Charles T. Bauer
Chairman of the Boards of Directors/Trustees
December 20, 1996
22
<PAGE> 27
ANNEX A
NUMBER OF SHARES OUTSTANDING ON DECEMBER 3, 1996
FOR EACH PORTFOLIO OF STIC, STIT AND TFIC
SHORT-TERM INVESTMENTS CO.
<TABLE>
<CAPTION>
NUMBER OF SHARES
OUTSTANDING ON
NAME OF FUND DECEMBER 3, 1996
- ------------------------------------------------------------------------- -----------------
<S> <C>
Liquid Assets Portfolio.................................................. 2,730,763,130.810
Prime Portfolio.......................................................... 6,562,343,203.580
-----------------
TOTAL--SHORT-TERM INVESTMENTS CO. ....................................... 9,293,106,334.390
=================
</TABLE>
SHORT-TERM INVESTMENTS TRUST
<TABLE>
<CAPTION>
NUMBER OF SHARES
OUTSTANDING ON
NAME OF FUND DECEMBER 3, 1996
- ------------------------------------------------------------------------- -----------------
<S> <C>
Treasury Portfolio....................................................... 4,506,725,456.440
Treasury TaxAdvantage Portfolio.......................................... 450,085,254.920
-----------------
TOTAL--SHORT-TERM INVESTMENTS TRUST...................................... 4,956,810,711.360
=================
</TABLE>
TAX-FREE INVESTMENTS CO.
<TABLE>
<CAPTION>
NUMBER OF SHARES
OUTSTANDING ON
NAME OF FUND DECEMBER 3, 1996
- ------------------------------------------------------------------------- -----------------
<S> <C>
Cash Reserve Portfolio................................................... 1,086,107,556.440
=================
</TABLE>
23
<PAGE> 28
ANNEX B
DATES OF ADVISORY AGREEMENTS
<TABLE>
<CAPTION>
DATE SINCE
AIM
DATE LAST HAS SERVED
DATE OF CURRENT ADVISORY SUBMITTED TO A VOTE AS INVESTMENT
NAME OF COMPANY AND FUND AGREEMENT OF SHAREHOLDERS* ADVISOR
- --------------------------- ---------------------------------- -------------------- -----------------
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS CO.
Liquid Assets Portfolio Master Investment Advisory September 27, 1993 August 6, 1993
Agreement, dated October 18, 1993
Prime Portfolio Master Investment Advisory September 27, 1993 December 31, 1986
Agreement, dated October 18, 1993
SHORT-TERM INVESTMENTS
TRUST
Treasury Portfolio Master Investment Advisory August 6, 1993 December 31, 1986
Agreement, dated October 18, 1993
Treasury TaxAdvantage Master Investment Advisory August 6, 1993 August 30, 1990
Portfolio Agreement, dated October 18, 1993
TAX-FREE
INVESTMENTS CO.
Cash Reserve Portfolio Master Investment Advisory September 27, 1993 May 1, 1982
Agreement, dated October 18, 1993
</TABLE>
- ------------------------------
* The Current Advisory Agreements, dated October 18, 1993, were last submitted
to a vote of shareholders in 1993 as a result of a reorganization of several
AIM Funds and/or the recapitalization of A I M Management Group Inc.
24
<PAGE> 29
ANNEX C
[NAME OF COMPANY]
MASTER INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this day of , 1997, by and between [Name
of Company], a [state company or trust] (the "Company") with respect to its
series of shares shown on the Appendix A attached hereto, as the same may be
amended from time to time, and A I M Advisors, Inc., a Delaware corporation (the
"Advisor").
RECITALS
WHEREAS, the Company is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end, diversified management
investment company;
WHEREAS, the Advisor is registered under the Investment Advisers Act of
1940, as amended (the "Advisers Act"), as an investment advisor and engages in
the business of acting as an investment advisor;
WHEREAS, the Company's [Charter] [Agreement and Declaration of Trust]
authorizes the Board of [Directors/Trustees] of the Company to classify or
reclassify authorized but unissued shares of the Company, and as of the date of
this Agreement, the Company's Board of [Directors/Trustees] has authorized the
issuance of [ ] series of shares representing interests in [ ]
investment portfolios (such portfolios and any other portfolios hereafter added
to the Company being referred to individually herein as a "Fund," collectively
as the "Funds"); and
WHEREAS, the Company and the Advisor desire to enter into an agreement to
provide for investment advisory services to the Funds upon the terms and
conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
1. Advisory Services. The Advisor shall act as investment advisor for the
Funds and shall, in such capacity, supervise all aspects of the Funds'
operations, including the investment and reinvestment of cash, securities or
other properties comprising the Funds' assets, subject at all times to the
policies and control of the Company's Board of [Directors/Trustees]. The Advisor
shall give the Company and the Funds the benefit of its best judgment, efforts
and facilities in rendering its services as investment advisor.
2. Investment Analysis and Implementation. In carrying out its obligations
under Section 1 hereof, the Advisor shall:
(a) supervise all aspects of the operations of the Funds;
(b) obtain and evaluate pertinent information about significant
developments and economic, statistical and financial data, domestic,
foreign or otherwise, whether affecting the economy generally or the Funds,
and whether concerning the individual issuers whose securities are included
in the assets of the Funds or the activities in which such issuers engage,
or with respect to securities which the Advisor considers desirable for
inclusion in the Funds' assets;
25
<PAGE> 30
(c) determine which issuers and securities shall be represented in the
Funds' investment portfolios and regularly report thereon to the Company's
Board of [Directors/Trustees]; and
(d) formulate and implement continuing programs for the purchases and
sales of the securities of such issuers and regularly report thereon to the
Company's Board of [Directors/Trustees];
and take, on behalf of the Company and the Funds, all actions which appear to
the Company and the Funds necessary to carry into effect such purchase and sale
programs and supervisory functions as aforesaid, including but not limited to
the placing of orders for the purchase and sale of securities for the Funds.
3. Delegation of Responsibilities. Subject to the approval of the Board of
[Directors/Trustees] and the shareholders of the Funds, the Advisor may delegate
to a sub-advisor certain of its duties enumerated in Section 2 hereof, provided
that the Advisor shall continue to supervise the performance of any such
sub-advisor.
4. Control by Board of [Directors/Trustees]. Any investment program
undertaken by the Advisor pursuant to this Agreement, as well as any other
activities undertaken by the Advisor on behalf of the Funds, shall at all times
be subject to any directives of the Board of [Directors/Trustees] of the
Company.
5. Compliance with Applicable Requirements. In carrying out its obligations
under this Agreement, the Advisor shall at all times conform to:
(a) all applicable provisions of the 1940 Act and the Advisers Act and
any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of the Company, as
the same may be amended from time to time under the Securities Act of 1933
and the 1940 Act;
(c) the provisions of the [Charter] [Agreement and Declaration of
Trust] of the Company, as the same may be amended from time to time;
(d) the provisions of the by-laws of the Company, as the same may be
amended from time to time; and
(e) any other applicable provisions of state, federal or foreign law.
6. Broker-Dealer Relationships. The Advisor is responsible for decisions to
buy and sell securities for the Funds, broker-dealer selection, and negotiation
of brokerage commission rates. The Advisor's primary consideration in effecting
a security transaction will be to obtain execution at the most favorable price.
In selecting a broker-dealer to execute each particular transaction, the Advisor
will take the following into consideration: the best net price available; the
reliability, integrity and financial condition of the broker-dealer; the size of
and the difficulty in executing the order; and the value of the expected
contribution of the broker-dealer to the investment performance of the Funds on
a continuing basis. Accordingly, the price to the Funds in any transaction may
be less favorable than that available from another broker-dealer if the
difference is reasonably justified by other aspects of the portfolio execution
services offered. Subject to such policies as the Board of [Directors/Trustees]
may from time to time determine, the Advisor shall not be deemed to have acted
unlawfully or to have
26
<PAGE> 31
breached any duty created by this Agreement or otherwise solely by reason of its
having caused the Funds to pay a broker or dealer that provides brokerage and
research services to the Advisor an amount of commission for effecting a
portfolio investment transaction in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction, if the
Advisor determines in good faith that such amount of commission was reasonable
in relation to the value of the brokerage and research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
Advisor's overall responsibilities with respect to a particular Fund, other
Funds of the Company, and to other clients of the Advisor as to which the
Advisor exercises investment discretion. The Advisor is further authorized to
allocate the orders placed by it on behalf of the Funds to such brokers and
dealers who also provide research or statistical material, or other services to
the Funds, to the Advisor, or to any sub-advisor. Such allocation shall be in
such amounts and proportions as the Advisor shall determine and the Advisor will
report on said allocations regularly to the Board of [Directors][Trustees] of
the Company indicating the brokers to whom such allocations have been made and
the basis therefor. In making decisions regarding broker-dealer relationships,
the Advisor may take into consideration the recommendations of any sub-advisor
appointed to provide investment research or advisory services in connection with
the Funds, and may take into consideration any research services provided to
such sub-advisor by broker-dealers.
7. Compensation. The Company shall pay the Advisor as compensation for
services rendered to a Fund hereunder an annual fee, payable monthly, based upon
the average daily net assets of such Fund as the same is set forth in Appendix A
attached hereto. Such compensation shall be paid solely from the assets of such
Fund. The average daily net asset value of the Funds shall be determined in the
manner set forth in the [Charter][Agreement and Declaration of Trust] and
registration statement of the Company, as amended from time to time.
8. Additional Services. Upon the request of the Company's Board of
[Directors][Trustees], the Advisor may perform certain accounting, shareholder
servicing or other administrative services on behalf of the Funds which are not
required by this Agreement. Such services will be performed on behalf of the
Funds and the Advisor may receive from the Funds such reimbursement for costs or
reasonable compensation for such services as may be agreed upon between the
Advisor and the Company's Board of [Directors][Trustees] based on a finding by
the Board of [Directors][Trustees] that the provision of such services by the
Advisor is in the best interests of the Company and its shareholders. Payment or
assumption by the Advisor of any Fund expense that the Advisor is not otherwise
required to pay or assume under this Agreement shall not relieve the Advisor of
any of its obligations to the Funds nor obligate the Advisor to pay or assume
any similar Fund expense on any subsequent occasions. Such services may include,
but are not limited to:
(a) the services of a principal financial officer of the Company
(including applicable office space, facilities and equipment) whose normal
duties consist of maintaining the financial accounts and books and records
of the Company and the Funds, including the review and calculation of daily
net asset value and the preparation of tax returns; and the services
(including applicable office space, facilities and equipment) of any of the
personnel operating under the direction of such principal financial
officer;
(b) the services of staff to respond to shareholder inquiries
concerning the status of their accounts; providing assistance to
shareholders in exchanges among the mutual funds managed or advised by the
Advisor; changing account designations or changing addresses; assisting in
the purchase or redemption of shares; supervising the operations of the
custodian, transfer agent(s)
27
<PAGE> 32
or dividend disbursing agent(s) for the Funds; or otherwise providing
services to shareholders of the Funds; and
(c) such other administrative services as may be furnished from time
to time by the Advisor to the Company or the Funds at the request of the
Company's Board of [Directors/Trustees].
9. Expenses of the Funds. All of the ordinary business expenses incurred in
the operations of the Funds and the offering of their shares shall be borne by
the Funds unless specifically provided otherwise in this Agreement. These
expenses borne by the Funds include but are not limited to brokerage
commissions, taxes, legal, accounting auditing, or governmental fees, the cost
of preparing share certificates, custodian, transfer and shareholder service
agent costs, expenses of issue, sale, redemption and repurchase of shares,
expenses of registering and qualifying shares for sale, expenses relating to
directors and shareholder meetings, the cost of preparing and distributing
reports and notices to shareholders, the fees and other expenses incurred by the
Company on behalf of the Funds in connection with membership in investment
company organizations and the cost of printing copies of prospectuses and
statements of additional information distributed to the Funds' shareholders.
10. Expense Limitation. If, for any fiscal year of the Company, the total
of all ordinary business expenses of the Funds, including all investment
advisory fees, but excluding brokerage commissions and fees, taxes, interest and
extraordinary expenses, such as litigation costs, would exceed the applicable
expense limitations imposed by state securities regulations in any state in
which the Funds' shares are qualified for sale, as such limitations may be
raised or lowered from time to time, the aggregate of all such investment
advisory fees shall be reduced by the amount of such excess. [This section
applies only to Tax-Free Investments Co. In the event the operating expenses of
the Fund (including all investment advisory fees, management fees and
distribution fees) for any fiscal year of the Company with respect to the
Institutional Cash Reserve Shares, exceed 0.40% of the average daily net assets
attributable to the Institutional Cash Reserve Shares, the Advisor shall reduce
its investment advisory fee to the extent of its share of such excess expenses;
provided, however, there shall be excluded from such expenses the amount of any
interest, taxes, brokerage commissions, and extraordinary expenses (including,
but not limited to, legal claims and liabilities and litigation costs and any
indemnification related thereto) paid or payable by the Fund.] The amount of any
such reduction to be borne by the Advisor shall be deducted from the monthly
investment advisory fee otherwise payable to the Advisor during such fiscal
year. If required pursuant to such state securities regulations, the Advisory
will, not later than the last day of the first month of the next succeeding
fiscal year, reimburse the Funds for any such annual operating expenses (after
reduction of all investment advisory fees in excess of such limitation). For the
purposes of this Section, the term "fiscal year" shall exclude the portion of
the current fiscal year which shall have elapsed prior to the date hereof and
shall include the portion of the then current fiscal year which shall have
elapsed at the date of termination of this Agreement. The application of expense
limitations shall be applied to each Fund of the Company separately unless the
laws or regulations of any state shall require that the expense limitations be
imposed with respect to the Company as a whole.
11. Non-Exclusivity. The services of the Advisor to the Company and the
Funds are not to be deemed to be exclusive, and the Advisor shall be free to
render investment advisory and administrative or other services to others
(including other investment companies) and to engage in other activities. It is
understood and agreed that officers or directors of the Advisor may serve as
officers or directors of the Company, and that officers or directors of the
Company may serve as officers or directors of the
28
<PAGE> 33
Advisor to the extent permitted by law; and that the officers and directors of
the Advisor are not prohibited from engaging in any other business activity or
from rendering services to any other person, or from serving as partners,
officers, directors or trustees of any other firm or trust, including other
investment advisory companies.
12. Term and Approval. This Agreement shall become effective with respect
to a Fund if approved by the shareholders of such Fund, and if so approved, this
Agreement shall thereafter continue in force and effect until February 28, 1999,
and may be continued from year to year thereafter, provided that the
continuation of the Agreement is specifically approved at least annually;
(a) (i) by the Company's Board of [Directors] [Trustees] or (ii) by
the vote of "a majority of the outstanding voting securities" of such Fund
(as defined in Section 2(a)(42) of the 1940 Act); and
(b) by the affirmative vote of a majority of the [Directors]
[Trustees] who are not parties to this Agreement or "interested persons"
(as defined in the 1940 Act) of a party to this Agreement (other than as
Company [Directors] [Trustees]), by votes cast in person at a meeting
specifically called for such purpose.
13. Termination. This Agreement may be terminated as to the Company or as
to any one or more of the Funds at any time, without the payment of any penalty,
by vote of the Company's Board of [Directors/Trustees] or by vote of a majority
of the outstanding voting securities of the applicable Fund, or by the Advisor,
on sixty (60) days' written notice to the other party. The notice provided for
herein may be waived by the party entitled to receipt thereof. This Agreement
shall automatically terminate in the event of its assignment, the term
"assignment" for purposes of this paragraph having the meaning defined in
Section 2(a)(4) of the 1940 Act.
14. Liability of Advisor and Indemnification. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of obligations or
duties hereunder on the part of the Advisor or any of its officers, directors or
employees, the Advisor shall not be subject to liability to the Company or to
the Funds or to any shareholder of the Funds for any act or omission in the
course of, or connected with, rendering services hereunder or for any losses
that may be sustained in the purchase, holding or sale of any security.
15. Liability of Shareholders. [This section is applicable to STIT, a
Delaware business trust]. Notice is hereby given that, as provided by applicable
law, the obligations of or arising out of this Agreement are not binding upon
any of the shareholders of the Company individually but are binding only upon
the assets and property of the Company and that the shareholders shall be
entitled, to the fullest extent permitted by applicable law, to the same
limitation on personal liability as stockholders of private corporations for
profit.
16. Notices. Any notices under this Agreement shall be in writing,
addressed and delivered, telecopied or mailed postage paid, to the other party
entitled to receipt thereof at such address as such party may designate for the
receipt of such notice. Until further notice to the other party, it is agreed
that the address of the Company shall be and that of the Advisor shall be Eleven
Greenway Plaza, Suite 1919, Houston, Texas 77046.
17. Questions of Interpretation. Any question of interpretation of any term
or provision of this Agreement having a counterpart in or otherwise derived from
a term or provision of the 1940 Act or
29
<PAGE> 34
the Advisers Act shall be resolved by reference to such term or provision of the
1940 Act or the Advisers Act and to interpretations thereof, if any, by the
United States Courts or in the absence of any controlling decision of any such
court, by rules, regulations or orders of the Securities and Exchange Commission
issued pursuant to said Acts. In addition, where the effect of a requirement of
the 1940 Act or the Advisers Act reflected in any provision of the Agreement is
revised by rule, regulation or order of the Securities and Exchange Commission,
such provision shall be deemed to incorporate the effect of such rule,
regulation or order. [The following provision is applicable only to STIT:
Subject to the foregoing, this Agreement shall be governed by and construed in
accordance with the laws (without reference to conflicts of law provisions) of
the State of Texas.]
18. License Agreement. The Company shall have the non-exclusive right to
use the name "AIM" to designate any current or future series of shares only so
long as A I M Advisors, Inc. serves as investment manager or advisor to the
Company with respect to such series of shares.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers on the day and year first
written above.
<TABLE>
<S> <C>
[NAME OF COMPANY]
(a [state company or trust])
Attest:
By:
- -------------------------------------------- -----------------------------------------
Assistant Secretary President
(SEAL)
A I M ADVISORS, INC.
Attest:
By:
- -------------------------------------------- -----------------------------------------
Assistant Secretary President
(SEAL)
</TABLE>
30
<PAGE> 35
APPENDIX A
TO
MASTER INVESTMENT ADVISORY AGREEMENT
OF
[NAME OF COMPANY]
The Company shall pay the Advisor, out of the assets of a Fund, as full
compensation for all services rendered and all facilities furnished hereunder, a
management fee for such Fund set forth below. Such fee shall be calculated by
applying the following annual rates to the average daily net assets of such Fund
for the calendar year computed in the manner used for the determination of the
net asset value of shares of such Fund.
[FUND NAMES]
<TABLE>
<CAPTION>
ANNUAL
NET ASSETS RATE
------------------------------------------------------------------- -------
<S> <C>
</TABLE>
[Fees will be those set forth in Annex F]
31
<PAGE> 36
ANNEX D
FEES PAID TO AFFILIATES
IN MOST RECENT FISCAL YEAR
<TABLE>
<CAPTION>
AIM
(ADMINISTRATIVE FUND AIM
COMPANY AND FUND AGREEMENT)* MANAGEMENT** INSTITUTIONAL*
- ----------------------------------- --------------- ------------ --------------
<S> <C> <C> <C>
SHORT-TERM INVESTMENTS CO.
Liquid Assets Portfolio.......... $ 52,710 $ 209 $133,085
Prime Portfolio.................. 126,321 208,926 424,496
SHORT-TERM INVESTMENTS TRUST
Treasury Portfolio............... 86,796 307,819 256,535
Treasury TaxAdvantage
Portfolio..................... 30,056 -0- 33,534
TAX-FREE INVESTMENTS CO.
Cash Reserve Portfolio........... 75,960 -0- 64,592
</TABLE>
- ------------------------------
* Before Expense Reimbursements.
** Net amount received from Rule 12b-1 fees, not including amounts reallocated
to brokers, dealers, agents and other service providers.
32
<PAGE> 37
ANNEX E
EXECUTIVE OFFICERS
EXECUTIVE OFFICERS OF STIC
Officers of STIC serve at the pleasure of the Board and until their
successors are elected and qualified. Set forth below is certain information
regarding executive officers of STIC.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH STIC YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Charles T. Bauer 77 Chairman See Director/Trustee table under
Proposal 1.
Robert H. Graham 50 President See Director/Trustee table under
Proposal 1.
John J. Arthur* 52 Senior Vice President Senior Vice President and Treasurer,
and Treasurer A I M Advisors, Inc. ("AIM"); Vice
President and Treasurer, A I M
Management Group Inc. ("AIM
Management"), A I M Capital Management,
Inc. ("AIM Capital"), A I M
Distributors, Inc. ("AIM
Distributors"), A I M Fund Services,
Inc. ("AIM Services"), A I M
Institutional Fund Services, Inc. ("AIM
Institutional") and Fund Management
Company ("Fund Management").
Gary T. Crum 49 Senior Vice President Director and President, AIM Capital;
Director and Senior Vice President, AIM
Management, AIM; Director, AIM
Distributors;
J. Abbott Sprague 41 Vice President Director and President, AIM
Institutional and Fund Management;
Director and Senior Vice President,
AIM; Senior Vice President, AIM
Management.
Karen Dunn Kelley 36 Vice President Senior Vice President, AIM Capital;
Vice President, AIM.
</TABLE>
- ---------------
* Mr. Arthur and Ms. Relihan are married to each other.
33
<PAGE> 38
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH STIC YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Carol F. Relihan* 42 Senior Vice President Senior Vice President, General Counsel
and Secretary and Secretary, AIM; Vice President,
General Counsel and Secretary, AIM
Management; Vice President and General
Counsel, Fund Management; Vice
President, AIM Distributors, AIM
Capital, AIM Services, and AIM
Institutional.
Dana R. Sutton 37 Vice President and Vice President and Fund Controller,
Assistant Treasurer AIM; Assistant Vice President and
Assistant Treasurer, Fund Management.
Melville B. Cox 53 Vice President Vice President and Chief Compliance
Officer, AIM, AIM Capital, AIM
Distributors, AIM Services, AIM
Institutional and Fund Management;
Formerly, Vice President, Charles
Schwab & Co., Inc.; Assistant
Secretary, Charles Schwab Family of
Funds and Schwab Investments; Chief
Compliance Officer, Charles Schwab
Investment Management, Inc.; and Vice
President, Integrated Resources Life
Insurance Fund and Capital Life
Insurance Fund.
</TABLE>
EXECUTIVE OFFICERS OF STIT
Officers of STIT serve at the pleasure of the Board and until their
successors are elected and qualified. Set forth below is certain information
regarding the executive officers of STIT.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH STIT YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Charles T. Bauer 77 Chairman See Director/Trustee table under
Proposal 1.
Robert H. Graham 50 President See Director/Trustee table under
Proposal 1.
John J. Arthur* 52 Senior Vice President Senior Vice President and Treasurer,
and Treasurer AIM; Vice President and Treasurer, AIM
Management, AIM Capital, AIM
Distributors, AIM Services, AIM
Institutional and Fund Management.
</TABLE>
- ---------------
* Mr. Arthur and Ms. Relihan are married to each other.
34
<PAGE> 39
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH STIT YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Gary T. Crum 49 Senior Vice President Director and President, AIM Capital;
Director and Senior Vice President, AIM
Management, AIM; Director, AIM
Distributors.
J. Abbott Sprague 41 Vice President Director and President, AIM
Institutional and Fund Management;
Director and Senior Vice President,
AIM; Senior Vice President, AIM
Management.
Karen Dunn Kelley 36 Vice President Senior Vice President, AIM Capital;
Vice President, AIM.
Carol F. Relihan* 42 Senior Vice President Senior Vice President, General Counsel
and Secretary and Secretary, AIM; Vice President,
General Counsel and Secretary, AIM
Management; Vice President and General
Counsel, Fund Management; Vice
President, AIM Distributors, AIM
Capital, AIM Services, and AIM
Institutional.
Dana R. Sutton 37 Vice President and Vice President and Fund Controller,
Assistant Treasurer AIM; Assistant Vice President and
Assistant Treasurer, Fund Management.
Melville B. Cox 53 Vice President Vice President and Chief Compliance
Officer, AIM, AIM Capital, AIM
Distributors, AIM Services, AIM
Institutional and Fund Management;
Formerly, Vice President, Charles
Schwab & Co., Inc.; Assistant
Secretary, Charles Schwab Family of
Funds and Schwab Investments; Chief
Compliance Officer, Charles Schwab
Investment Management, Inc.; and Vice
President, Integrated Resources Life
Insurance Fund and Capital Life
Insurance Fund.
</TABLE>
- ------------------------------
* Mr. Arthur and Ms. Relihan are married to each other.
35
<PAGE> 40
EXECUTIVE OFFICERS OF TFIC
Officers of TFIC serve at the pleasure of the Board and until their
successors are elected and qualified. Set forth below is certain information
regarding the executive officers of TFIC.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH TFIC YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Charles T. Bauer 77 Chairman See Director/Trustee table under
Proposal 1.
Robert H. Graham 50 President See Director/Trustee table under
Proposal 1.
John J. Arthur* 52 Senior Vice President Senior Vice President and Treasurer,
and Treasurer AIM; Vice President and Treasurer, AIM
Management, AIM Capital, AIM
Distributors, AIM Services, AIM
Institutional and Fund Management.
Gary T. Crum 49 Senior Vice President Director and President, AIM Capital;
Director and Senior Vice President, AIM
Management, AIM; Director, AIM
Distributors.
J. Abbott Sprague 41 Vice President Director and President, AIM
Institutional and Fund Management;
Director and Senior Vice President,
AIM; Senior Vice President, AIM
Management.
Karen Dunn Kelley 36 Vice President Senior Vice President, AIM
Distributors; Vice President, AIM.
Carol F. Relihan* 42 Senior Vice President Senior Vice President, General Counsel
and Secretary and Secretary, AIM; Vice President,
General Counsel and Secretary, AIM
Management; Vice President and General
Counsel, Fund Management; Vice
President, AIM Distributors, AIM
Capital, AIM Services, and AIM
Institutional.
Dana R. Sutton 37 Vice President and Vice President and Fund Controller,
Assistant Treasurer AIM; Assistant Vice President and
Assistant Treasurer, Fund Management.
</TABLE>
- ---------------
* Mr. Arthur and Ms. Relihan are married to each other.
36
<PAGE> 41
<TABLE>
<CAPTION>
BUSINESS EXPERIENCE DURING PAST FIVE
NAME AGE POSITION WITH TFIC YEARS
- ------------------ ---- ---------------------- ---------------------------------------
<S> <C> <C> <C>
Melville B. Cox 53 Vice President Vice President and Chief Compliance
Officer, AIM, AIM Capital, AIM
Distributors, AIM Services, AIM
Institutional and Fund Management;
Formerly, Vice President, Charles
Schwab & Co., Inc.; Assistant
Secretary, Charles Schwab Family of
Funds and Schwab Investments; Chief
Compliance Officer, Charles Schwab
Investment Management, Inc.; and Vice
President, Integrated Resources Life
Insurance Fund and Capital Life
Insurance Fund.
Stuart W. Coco 41 Vice President Senior Vice President, AIM
Distributors; and Vice President, AIM.
</TABLE>
37
<PAGE> 42
ANNEX F
ADVISORY AGREEMENT FEE SCHEDULE
<TABLE>
<CAPTION>
AGGREGATE WAIVERS
TOTAL NET FEES FOR THE
NET ASSETS PAID TO AIM MOST
FOR THE MOST FOR THE MOST RECENTLY
ANNUAL RATE RECENTLY RECENTLY COMPLETED
(BASED ON AVERAGE COMPLETED COMPLETED FISCAL
NAME OF COMPANY AND FUND DAILY NET ASSETS) FISCAL YEAR FISCAL YEAR* YEAR
- ----------------------------------------- -------------------------- --------------- ------------ ----------
<S> <C> <C> <C> <C>
AIM EQUITY FUNDS, INC.
AIM Aggressive Growth 0.80% of the first $150
million.
0.625% of the excess over
$150 million. $ 2,750,563,943 $16,492,564 0
AIM Blue Chip Fund 0.75% of the first $350
million.
0.625% of the excess over
$350 million. $ 128,548,354 $ 256,773 ** $26,433
AIM Capital Development Fund 0.75% of the first $350
million.
0.625% of the excess over
$350 million. $ 273,687,609 $ 280,248 *** $144,946
AIM Charter Fund 1.00% of the first $30
million.
0.75% over $30 million up
to $150 million.
0.625% of the excess over
$150 million. $ 3,192,471,415 $16,529,891 $156,975
AIM Constellation Fund 1.00% of the first $30
million.
0.75% over $30 million up
to $150 million.
0.625% of the excess over
$150 million. $11,548,540,962 $57,614,412 $1,869,383
AIM Weingarten Fund 1.00% of the first $30
million.
0.75% over $30 million up
to $350 million.
0.625% of the excess over
$350 million. $ 5,305,435,087 $29,960,379 $1,458,804
</TABLE>
- ---------------
* AIM reimbursed expenses with respect to the following Funds: AIM Municipal
Bond Fund, $13,200; AIM Global Growth Fund, $11,719; AIM Global Income Fund,
$18,300; AIM V.I. Global Utilities Fund, $13,800; Liquid Assets Portfolio,
$116,930; Prime Portfolio, $61,100; Treasury Portfolio, $113,500; Treasury
TaxAdvantage Portfolio, $25,600; and Cash Reserve Portfolio, $20,000.
** For the period 06/03/96 through 10/31/96.
*** For the period 06/17/96 through 10/31/96.
38
<PAGE> 43
ADVISORY AGREEMENT FEE SCHEDULE
<TABLE>
<CAPTION>
AGGREGATE WAIVERS
TOTAL NET FEES FOR THE
NET ASSETS PAID TO AIM MOST
FOR THE MOST FOR THE MOST RECENTLY
ANNUAL RATE RECENTLY RECENTLY COMPLETED
(BASED ON AVERAGE COMPLETED COMPLETED FISCAL
NAME OF COMPANY AND FUND DAILY NET ASSETS) FISCAL YEAR FISCAL YEAR* YEAR
- ----------------------------------------- -------------------------- --------------- ------------ ----------
<S> <C> <C> <C> <C>
AIM FUNDS GROUP
AIM Balanced Fund 0.75% of the first $150
million.
0.50% of the excess over
$150 million. $ 164,874,356 $ 666,619 $24,176
AIM Global Utilities Fund 0.60% of the first $200
million.
0.50% over $200 million up
to $500 million.
0.40% over $500 million up
to $1 billion.
0.30% of the excess over
$1 billion. $ 241,317,685 $ 1,256,220 0
AIM Growth Fund 0.80% of the first $150
million.
0.625% of excess over $150
million. $ 306,250,064 $ 1,715,406 0
AIM High Yield Fund 0.625% of the first $200
million.
0.55% over $200 million to
$500 million.
0.50% over $500 million to
$1 billion.
0.45% of the excess over
$1 billion. $ 1,444,032,572 $ 5,717,303 0
AIM Income Fund 0.50% of the first $200
million.
0.40% over $200 million to
$500 million.
0.35% over $500 million to
$1 billion.
0.30% of the excess over
$1 billion. $ 295,583,696 $ 1,176,249 0
AIM Intermediate Government Fund 0.50% of the first $200
million.
0.40% over $200 million to
$500 million.
0.35% over $500 million to
$1 billion.
0.30% of the excess over
$1 billion. $ 237,617,705 $ 996,681 0
AIM Money Market Fund 0.55% of the first $1
billion.
0.50% of the excess over
$1 billion. $ 584,793,680 $ 2,589,822 0
</TABLE>
39
<PAGE> 44
ADVISORY AGREEMENT FEE SCHEDULE
<TABLE>
<CAPTION>
AGGREGATE WAIVERS
TOTAL NET FEES FOR THE
NET ASSETS PAID TO AIM MOST
FOR THE MOST FOR THE MOST RECENTLY
ANNUAL RATE RECENTLY RECENTLY COMPLETED
(BASED ON AVERAGE COMPLETED COMPLETED FISCAL
NAME OF COMPANY AND FUND DAILY NET ASSETS) FISCAL YEAR FISCAL YEAR* YEAR
- ----------------------------------------- -------------------------- --------------- ------------ ----------
<S> <C> <C> <C> <C>
AIM Municipal Bond Fund 0.50% of the first $200
million.
0.40% over $200 million to
$500 million.
0.35% over $500 million to
$1 billion.
0.30% of the excess over
$1 billion. $ 306,280,329 $ 1,356,225 0
AIM Value Fund 0.80% of the first $150
million.
0.625% of excess over $150
million. $ 6,269,483,246 $24,829,687 $502,799
AIM INTERNATIONAL FUNDS, INC.
AIM Global Aggressive Growth Fund 0.90% of the first $1
billion.
0.85% of the excess over
$1 billion. $ 1,726,533,976 $ 8,751,918 0
AIM Global Growth Fund 0.85% of the first $1
billion.
0.80% of the excess over
$1 billion. $ 236,819,172 $ 1,162,771 0
AIM Global Income Fund 0.70% of the first $1
billion.
0.65% of the excess over
$1 billion. $ 38,713,770 $ 0 $182,596
AIM International Equity Fund 0.95% of the first $1
billion.
0.90% of the excess over
$1 billion. $ 1,476,749,468 $10,085,495 $299,147
AIM INVESTMENT SECURITIES FUNDS
Limited Maturity Treasury Portfolio 0.20% of the first $500
million.
0.175% of the excess over
$500 million. $ 502,515,805 $ 933,207 0
AIM SUMMIT FUND, INC. 1.00% of the first $10
million.
0.75% over $10 million to
$150 million.
0.625% over $150 million. $ 1,261,008,244 $ 7,360,028 **** 0
AIM TAX-EXEMPT FUNDS, INC.
AIM Tax-Exempt Cash Fund 0.35%. $ 30,014,343 $ 101,649 0
AIM Tax-Exempt Bond Fund of Connecticut 0.50%. $ 39,355,441 $ 0 $198,182
</TABLE>
- ---------------
**** Of the $7,360,028 paid to AIM, $2,442,907 was paid by AIM to TradeStreet
pursuant to a sub-advisory agreement.
40
<PAGE> 45
ADVISORY AGREEMENT FEE SCHEDULE
<TABLE>
<CAPTION>
AGGREGATE WAIVERS
TOTAL NET FEES FOR THE
NET ASSETS PAID TO AIM MOST
FOR THE MOST FOR THE MOST RECENTLY
ANNUAL RATE RECENTLY RECENTLY COMPLETED
(BASED ON AVERAGE COMPLETED COMPLETED FISCAL
NAME OF COMPANY AND FUND DAILY NET ASSETS) FISCAL YEAR FISCAL YEAR* YEAR
- ----------------------------------------- -------------------------- --------------- ------------ ----------
<S> <C> <C> <C> <C>
Intermediate Portfolio 0.30% of the first $500
million.
0.25% over $500 million to
$1 billion.
0.20% of the excess over
$1 billion. $ 83,066,447 $ 232,893 0
AIM VARIABLE INSURANCE FUNDS, INC.
AIM V.I. Capital Appreciation Fund 0.65% of the first $250
million.
0.60% of the excess over
$250 million. $ 212,152,423 $ 882,870 0
AIM V.I. Diversified Income Fund 0.60% of the first $250
million.
0.55% of the excess over
$250 million. $ 44,630,145 $ 193,008 0
AIM V.I. Global Utilities Fund 0.65% of the first $250
million.
0.60% of the excess over
$250 million. $ 8,393,967 0 $32,703
AIM V.I. Government Securities Fund 0.50% of the first $250
million.
0.45% of the excess over
$250 million. $ 19,545,391 $ 71,080 0
AIM V.I. Growth Fund 0.65% of the first $250
million.
0.60% of the excess over
$250 million. $ 102,600,112 $ 434,620 0
AIM V.I. Growth and Income Fund 0.65% of the first $250
million.
0.60% of the excess over
$250 million. $ 38,567,212 $ 46,017 $67,802
AIM V.I. International Equity Fund 0.75% of the first $250
million.
0.70% of the excess over
$250 million. $ 82,256,855 $ 457,559 0
AIM V.I. Money Market Fund 0.40% of the first $250
million.
0.35% of the excess over
$250 million. $ 65,505,754 $ 168,901 0
AIM V.I. Value Fund 0.65% of the first $250
million.
0.60% of the excess over
$250 million. $ 257,211,787 $ 1,078,007 0
</TABLE>
41
<PAGE> 46
ADVISORY AGREEMENT FEE SCHEDULE
<TABLE>
<CAPTION>
AGGREGATE WAIVERS
TOTAL NET FEES FOR THE
NET ASSETS PAID TO AIM MOST
FOR THE MOST FOR THE MOST RECENTLY
ANNUAL RATE RECENTLY RECENTLY COMPLETED
(BASED ON AVERAGE COMPLETED COMPLETED FISCAL
NAME OF COMPANY AND FUND DAILY NET ASSETS) FISCAL YEAR FISCAL YEAR* YEAR
- ----------------------------------------- -------------------------- --------------- ------------ ----------
<S> <C> <C> <C> <C>
SHORT-TERM INVESTMENTS CO.
Liquid Assets Portfolio 0.15%. $ 2,086,944,322 $ 125,264 $2,562,094
Prime Portfolio 0.20% of the first $100
million.
0.15% over $100 million up
to $200 million.
0.10% over $200 million up
to $300 million.
0.06% over $300 million up
to $1.5 billion.
0.05% over $1.5 billion. $ 6,151,948,355 $ 3,007,431 0
SHORT-TERM INVESTMENTS TRUST
Treasury Portfolio 0.15% of the first $300
million.
0.06% over $300 million up
to $1.5 billion.
0.05% of the excess over
$1.5 billion. $ 3,703,891,140 $ 2,227,788 0
Treasury TaxAdvantage Portfolio 0.20% of the first $250
million.
0.15% over $250 million up
to $500 million.
0.10% of the excess over
$500 million. $ 457,196,150 $ 675,795 $116,126
TAX-FREE INVESTMENTS CO.
Cash Reserve Portfolio 0.25% of the first $500
million.
0.20% of the excess over
$500 million. $ 1,044,178,428 $ 1,819,232 $690,397
</TABLE>
42
<PAGE> 47
ANNEX G
SECURITY OWNERSHIP OF CERTAIN OWNERS AND MANAGEMENT
SECURITY OWNERSHIP OF MANAGEMENT
STIC
As of December 3, 1996, none of the Directors or the Chief Executive
Officer of STIC owned shares of any portfolio of STIC.
STIT
As of December 3, 1996, none of the Directors or the Chief Executive
Officer of STIT owned shares of any portfolio of STIT.
TFIC
As of December 3, 1996, none of the Directors or the Chief Executive
Officer owned shares of any portfolio of TFIC.
SECURITY OWNERSHIP OF CERTAIN RECORD OWNERS
STIC
To the best knowledge of STIC, the names and addresses of the record
holders of 5% or more of the outstanding shares of STIC as of the Record Date,
and the amount of the outstanding shares owned of record by such holders are set
forth below. STIC has no knowledge of shares held beneficially.
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
LIQUID ASSETS PORTFOLIO
CASH MANAGEMENT CLASS....................... Fund Services Associates 60,000,000 56.69%
11835 West Olympic Blvd.
Suite 205
Los Angeles, CA 90064
Oppenheimer & Co. 24,768,159 23.40%
Oppenheimer Tower
World Financial Center
New York, NY 10281
The Bank of New York 7,678,012 7.25%
One Wall Street, 2nd floor
Stif/Master Note
New York, NY 10286
Intellon Corporation 6,004,649 5.67%
5100 West Silver Springs Blvd.
Ocala, FL 34482
</TABLE>
43
<PAGE> 48
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
INSTITUTIONAL CLASS......................... Wachovia Bank and Trust 369,591,937 14.44%
P.O. Box 3075
Winston-Salem, NC 27150
Trust Company Bank 265,032,201 10.35%
P.O. Box 105504
Atlanta, GA 30348
BZW Barclays Global Investors 200,000,000 7.81%
980 9th St. Suite 600
Sacramento, CA 95814
Citibank as Agent, City of NY 182,329,439 7.12%
111 Wall Street, 8th floor
New York, NY 10005
Society National Bank 164,199,987 6.41%
Security Lending
Mail Code 01-127-0423
127 Public Square, 4th floor
Cleveland, OH 44114-1306
Nationsbank 156,792,301 6.13%
1401 Elm St. 11th floor
P.O. Box 831000
Dallas, TX 75283-1000
American Express Credit Corp. 150,000,000 5.86%
301 N. Walnut Street
Suite 1002
Wilmington, DE 19801-2919
MSTC CASH RESERVES CLASS.................... A I M Advisors, Inc. 5,048,927 100%
11 Greenway Plaza
Suite 1919
Houston, TX 77046
PRIVATE INVESTMENT CLASS.................... Mellon Bank 59,147,438 98.31%
P.O. Box 710
Pittsburgh, PA 15230-0710
PRIME PORTFOLIO
CASH MANAGEMENT CLASS....................... Mellon Bank 86,847,386.25 26.58%
Three Mellon Center Rm 3840
Pittsburgh, PA 15259-0001
Oppenheimer & Co., Inc 29,823,379.97 9.13%
Oppenheimer Tower
World Financial Center
New York, NY 10281
Southwest Bank of Texas, N.A. 56,784,074.96 17.38%
4295 San Felipe
Houston, TX 77027
Fund Services Associates 55,631,186.07 17.02%
11835 West Olympic Blvd.
Suite 205
Los Angeles, CA 90064
INSTITUTIONAL CLASS......................... U.S. Bank of Oregon 680,333,005.13 11.87%
Trust Operations
321 Southwest Sixth
Portland, OR 97208
Comerica Bank 794,984,323.51 13.88%
P.O. Box 75000
Detroit, MI 48275-3455
</TABLE>
44
<PAGE> 49
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
NationsBank Texas 479,406,585.95 8.37%
1401 Elm Street 11th Floor
P.O. Box 831000
Dallas, TX 75283-1000
Boatman's Trust Company 352,336,388.94 6.15%
100 North Broadway
Attn: Fund Accounting LBT0785
St. Louis, MO 63101
Frost National Bank 329,748,223.07 5.76%
P.O. Box 1600
Attn: Trust Securities (T-8)
San Antonio, TX 78296
Liberty Registration Co. of Oklahoma City 321,918,185.13 5.62%
Trust Security Processing Dept.
P.O. Box 25848
Oklahoma City, OK 73125
Citicorp, N.A. 289,514,638.00 5.05%
400 Royal Palm Way
3rd Floor
Palm Beach, FL 33480
PERSONAL INVESTMENT CLASS................... Bank of New York 70,008,038.04 63.26%
440 Mamaroneck Avenue
Harrison, NY 10528
Cullen/Frost Discount Brokers 23,847,239.93 21.55%
P.O. Box 2358
San Antonio, TX 78299
Mark Twain Capital Markets Group 12,875,173.62 11.63%
1630 S. Lindbergh Blvd.
St. Louis, MO 63131
PRIVATE INVESTMENT CLASS.................... Huntington Capital Corp. 154,048,927.27 61.51%
41 S. High St.
9th Floor
Columbus, OH 43287
Frost National Bank 20,164,685.55 8.05%
P.O. Box 2950
San Antonio, TX 78299-2950
First Trust/Var & Co. 24,232,264.00 9.68%
Funds Control Suite 0404
180 East Fifth Street
St. Paul, MN 55101
Liberty Registration Co. of Oklahoma City 18,713,507.25 7.47%
P.O. Box 25848
Oklahoma City, OK 73125
Cullen/Frost Discount Brokers 13,450,913.20 5.37%
100 W. Houston St.
San Antonio, TX 78205
RESOURCE CLASS.............................. Mellon Bank 31,737,724.49 21.86%
Three Mellon Center Rm. 3840
Pittsburgh, PA 15259-0001
Corestates Capital Markets 21,055,787.58 14.50%
1345 Chestnut St.
FC 1-1-9-49
Philadelphia, PA 19101
</TABLE>
45
<PAGE> 50
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
Huntington Capital Corp. 13,302,366.39 9.16%
41 S. High St.
Ninth Floor
Columbus, OH 43287
Tulsa & Co. 9,906,097.31 6.82%
P.O. Box 3688
Tulsa, OK 74101-3688
Harris Webb & Garrison 13,302,366.39 9.16%
5599 San Felipe
Houston, TX 77056
</TABLE>
STIT
To the best knowledge of STIT, the names and addresses of the record
holders of 5% or more of the outstanding shares of STIT as of the Record Date,
and the amount of the outstanding shares owned of record by such holders are set
forth below. STIT has no knowledge of shares held beneficially.
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
TREASURY PORTFOLIO
CASH MANAGEMENT CLASS....................... Bank of New York 664,170,366.91 70.63%
4 Fisher Lane
White Plains, NY 10603
Fund Services Associates 197,908,474.61 21.05%
11835 West Olympic Blvd.
Suite 205
Los Angeles, CA 90064
INSTITUTIONAL CLASS......................... Trust Company Bank 404,396,737.08 14.08%
P.O. Box 105504
Atlanta, GA 30348
Victoria Bank and Trust Co. 242,069,692.78 8.43%
One O'Conner Plaza, 6th Floor
Victoria, TX 77902
Liberty Registration Co. of OK 221,651,407.12 7.72%
P.O. Box 25848
Oklahoma City, OK 73125
U.S. Bank of Washington 216,204,498.39 7.53%
P.O. Box 3168
Portland, OR 97208
NationsBank Texas 172,015,895.22 5.99%
1401 Elm Street 11th Floor
P.O. Box 831000
Dallas, TX 75283-1000
Key Trust Company 142,928,161.72 4.98%
4900 Tiedeman
Cleveland, OH 44101-5971
PERSONAL INVESTMENT CLASS................... Cullen/Frost Discount Brokers 139,638,197.14 65.38%
P.O. Box 2358
San Antonio, TX 78299
Bank of New York 55,159,353.88 25.83%
4 Fisher Lane
White Plains, NY 10603
</TABLE>
46
<PAGE> 51
<TABLE>
<CAPTION>
SHARES OWNED OF
NAME AND ADDRESS RECORD AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
Kinco & Co. C/O RNB Securities 14,950,867.00 7.00%
1 Hanson Pl., Lower Level
Brooklyn, NY 11243
PRIVATE INVESTMENT CLASS.................... Liberty Bank & Trust Company of Tulsa, N.A. 168,967,365.15 44.30%
P.O. Box 25848
Oklahoma City, OK 73125
First Trust/Var & Co. 78,565,065.00 20.60%
Funds Control Suite 0404
180 East Fifth Street
St. Paul, MN 55101
Huntington Capital Corp. 65,148,414.04 17.08%
41 S. High St.
9th Floor
Columbus, OH 43287
Bank of New York 23,622,825.80 6.19%
4 Fisher Lane
White Plains, NY 10603
RESOURCE CLASS.............................. Corestates Capital Markets 57,446,569.00 57.79%
1345 Chestnut St.
Philadelphia, PA 19101
Mellon Bank 40,816,650.19 41.06%
Three Mellon Center Rm. 3840
Pittsburgh, PA 15259-0001
TREASURY TAXADVANTAGE PORTFOLIO
INSTITUTIONAL CLASS......................... First Trust/Var & Co. 129,527,019.00 32.99%
Funds Control Suite 0404
180 East Fifth Street
St. Paul, MN 55101
Peoples Two Ten Company 75,612,665.64 19.26%
C/O Summit Bank
Trust Operations, 7th Floor
P.O. Box 821
Hackensack, NJ 07602
Boatman's Trust Company 43,260,837.98 11.02%
100 North Broadway
St. Louis, MO 63101
Liberty Registration Co. of OK 38,162,045.63 9.72%
P.O. Box 25848
Oklahoma City, OK 73125
NationsBank Texas 20,065,207.45 5.11%
1401 Elm Street 11th Floor
P.O. Box 831000
Dallas, TX 75283-1000
PRIVATE INVESTMENT CLASS.................... First National Bank of Chicago 43,139,953.45 75.01%
Mail Suite 0126
Chicago, IL 60670-0126
Huntington Capital Corp. 13,483,315.72 23.45%
41 S. High St.
9th Floor
Columbus, OH 43287
</TABLE>
47
<PAGE> 52
TFIC
To the best knowledge of TFIC, the names and addresses of the record
holders of 5% or more of the outstanding shares of TFIC as of the Record Date,
and the amount of the outstanding shares owned of record by such holders are set
forth below. TFIC has no knowledge of shares held beneficially.
<TABLE>
<CAPTION>
SHARES OF RECORD
NAME AND ADDRESS OWNED AS OF PERCENT
FUND (CLASS) OF RECORD OWNERS DECEMBER 3, 1996 OF CLASS
- ---------------------------------------------- ----------------------------------------------- ---------------- --------
<S> <C> <C> <C>
CASH RESERVE PORTFOLIO
INSTITUTIONAL CASH RESERVE SHARES........... Nationsbank Texas 250,245,948.64 23.75%
1401 Elm Street, 11th floor
P.O. Box 831000
Dallas, TX 75283-1000
Liberty Bank & Trust 134,384,020.52 12.76%
P.O. Box 25848
Oklahoma City, OK 73125
Trust Company Bank 116,524,733.34 11.06%
Center 3131
P.O. Box 105504
Atlanta, GA 30348
U.S. Bank of Oregon 81,683,554.86 7.75%
555 Southwest Oak
Portland, OR 97204-1752
Frost National Bank 65,167,499.27 6.19%
P.O. Box 1600
San Antonio, TX 78296
First Interstate Bank 60,491,140.87 5.74%
26610 West Agoura Rd.
Calabasas, CA 91302
PRIVATE INVESTMENT CLASS.................... Bank of New York 13,264,328.60 40.72%
4 Fisher Lane
White Plains, NY 10603
Huntington Capital Corp. 7,639,942.16 23.46%
41 S. High Street
Ninth Floor
Columbus, OH 43287
Cullen/Frost Discount Brokers 7,126,028.13 21.88%
P.O. Box 2358
San Antonio, TX 78299
Charter National Bank Houston 1,944,661.88 5.97%
P.O. Box 1494
Houston, TX 77251-1494
First National Bank of Chicago 1,724,731.71 5.30%
Corporate Trust Services
Mail Suite 0126
Chicago, IL 60670-0126
</TABLE>
48
<PAGE> 53
APPENDIX 1
PROXY PROXY
LIQUID ASSETS PORTFOLIO
A SERIES OF SHORT-TERM INVESTMENTS CO.
PROXY SOLICITED BY THE BOARD OF DIRECTORS/TRUSTEES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- FEBRUARY 7, 1997
The undersigned hereby appoints Charles T. Bauer, Robert H. Graham and Carol F.
Relihan, and each of them separately, proxies with the power of substitution to
each, and hereby authorizes them to represent and to vote, as designated below,
at the Annual Meeting of Shareholders of the Fund indicated above, on February
7, 1997 at 2 p.m. Central time, and at any adjournment thereof, all of the
shares of the Fund which the undersigned would be entitled to vote if personally
present. IF THIS PROXY IS SIGNED AND RETURNED WITH NO CHOICES INDICATED, THE
SHARES WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ON THIS PROXY AND
FOR APPROVAL OF THE OTHER PROPOSALS.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
ON THIS PROXY CARD. All joint owners should
sign. When signing as executor, administrator,
attorney, trustee or guardian or as custodian
for a minor, please give full title as such.
If a corporation, please sign in full
corporate name and indicate the signer's
office. If a partner, sign in the partnership
name.
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
___________________________________________
Date
GROUP D
<PAGE> 54
<TABLE>
<S> <C> <C> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS/TRUSTEES. THE DIRECTORS/TRUSTEES RECOMMEND VOTING "FOR" ALL PROPOSALS.
1. ELECTION OF DIRECTORS/TRUSTEES -- To Withhold Authority to vote for any individual nominee,
strike a line through the name below.
FOR ALL | | WITHHOLD AUTHORITY | | TO VOTE FILL IN BOX COMPLETELY
NOMINEES | | FOR ALL NOMINEES | |
except as marked below
Nominees: Charles T. Bauer Bruce L. Crockett Owen Daly II Carl Frischling Robert H. Graham
John F. Kroeger Lewis F. Pennock Ian W. Robinson Louis S. Sklar
FOR AGAINST ABSTAIN
2. Proposal to approve a new Master Investment Advisory Agreement for the Fund. / / / / / /
3. Proposal to eliminate fundamental investment policy prohibiting or restricting / / / / / /
investments in other investment companies and/or to amend certain related
fundamental investment policies.
4. Proposal to ratify the selection of KPMG Peat Marwick LLP as independent / / / / / /
accountants for the Fund.
5. IN THE DISCRETION OF SUCH PROXIES, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
</TABLE>
GROUP D
<PAGE> 55
PROXY PROXY
PRIME PORTFOLIO
A SERIES OF SHORT-TERM INVESTMENTS CO.
PROXY SOLICITED BY THE BOARD OF DIRECTORS/TRUSTEES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- FEBRUARY 7, 1997
The undersigned hereby appoints Charles T. Bauer, Robert H. Graham and Carol F.
Relihan, and each of them separately, proxies with the power of substitution to
each, and hereby authorizes them to represent and to vote, as designated below,
at the Annual Meeting of Shareholders of the Fund indicated above, on February
7, 1997 at 2 p.m. Central time, and at any adjournment thereof, all of the
shares of the Fund which the undersigned would be entitled to vote if personally
present. IF THIS PROXY IS SIGNED AND RETURNED WITH NO CHOICES INDICATED, THE
SHARES WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ON THIS PROXY AND
FOR APPROVAL OF THE OTHER PROPOSALS.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
ON THIS PROXY CARD. All joint owners should
sign. When signing as executor, administrator,
attorney, trustee or guardian or as custodian
for a minor, please give full title as such.
If a corporation, please sign in full
corporate name and indicate the signer's
office. If a partner, sign in the partnership
name.
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
___________________________________________
Date
GROUP D
<PAGE> 56
<TABLE>
<S> <C> <C> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS/TRUSTEES. THE DIRECTORS/TRUSTEES RECOMMEND VOTING "FOR" ALL PROPOSALS.
1. ELECTION OF DIRECTORS/TRUSTEES -- To Withhold Authority to vote for any individual nominee,
strike a line through the name below.
FOR ALL | | WITHHOLD AUTHORITY | | TO VOTE FILL IN BOX COMPLETELY
NOMINEES | | FOR ALL NOMINEES | |
except as marked below
Nominees: Charles T. Bauer Bruce L. Crockett Owen Daly II Carl Frischling Robert H. Graham
John F. Kroeger Lewis F. Pennock Ian W. Robinson Louis S. Sklar
FOR AGAINST ABSTAIN
2. Proposal to approve a new Master Investment Advisory Agreement for the Fund. / / / / / /
3. Proposal to eliminate fundamental investment policy prohibiting or restricting / / / / / /
investments in other investment companies and/or to amend certain related
fundamental investment policies.
4. Proposal to ratify the selection of KPMG Peat Marwick LLP as independent / / / / / /
accountants for the Fund.
5. IN THE DISCRETION OF SUCH PROXIES, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
</TABLE>
GROUP D
<PAGE> 57
PROXY PROXY
TREASURY PORTFOLIO
A SERIES OF SHORT-TERM INVESTMENTS TRUST
PROXY SOLICITED BY THE BOARD OF DIRECTORS/TRUSTEES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- FEBRUARY 7, 1997
The undersigned hereby appoints Charles T. Bauer, Robert H. Graham and Carol F.
Relihan, and each of them separately, proxies with the power of substitution to
each, and hereby authorizes them to represent and to vote, as designated below,
at the Annual Meeting of Shareholders of the Fund indicated above, on February
7, 1997 at 2 p.m. Central time, and at any adjournment thereof, all of the
shares of the Fund which the undersigned would be entitled to vote if personally
present. IF THIS PROXY IS SIGNED AND RETURNED WITH NO CHOICES INDICATED, THE
SHARES WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ON THIS PROXY AND
FOR APPROVAL OF THE OTHER PROPOSALS.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
ON THIS PROXY CARD. All joint owners should
sign. When signing as executor, administrator,
attorney, trustee or guardian or as custodian
for a minor, please give full title as such.
If a corporation, please sign in full
corporate name and indicate the signer's
office. If a partner, sign in the partnership
name.
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
___________________________________________
Date
GROUP D
<PAGE> 58
<TABLE>
<S> <C> <C> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS/TRUSTEES. THE DIRECTORS/TRUSTEES RECOMMEND VOTING "FOR" ALL PROPOSALS.
1. ELECTION OF DIRECTORS -- To Withhold Authority to vote for any individual nominee,
strike a line through the name below.
FOR ALL | | WITHHOLD AUTHORITY | | TO VOTE FILL IN BOX COMPLETELY
NOMINEES | | FOR ALL NOMINEES | |
except as marked below
Nominees: Charles T. Bauer Bruce L. Crockett Owen Daly II Carl Frischling Robert H. Graham
John F. Kroeger Lewis F. Pennock Ian W. Robinson Louis S. Sklar
FOR AGAINST ABSTAIN
2. Proposal to approve a new Master Investment Advisory Agreement for the Fund. / / / / / /
3. Proposal to eliminate fundamental investment policy prohibiting or restricting / / / / / /
investments in other investment companies and/or to amend certain related
fundamental investment policies.
4. Proposal to ratify the selection of KPMG Peat Marwick LLP as independent / / / / / /
accountants for the Fund.
5. IN THE DISCRETION OF SUCH PROXIES, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
</TABLE>
GROUP D
<PAGE> 59
PROXY PROXY
TREASURY TAXADVANTAGE PORTFOLIO
A SERIES OF SHORT-TERM INVESTMENTS TRUST
PROXY SOLICITED BY THE BOARD OF DIRECTORS/TRUSTEES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- FEBRUARY 7, 1997
The undersigned hereby appoints Charles T. Bauer, Robert H. Graham and Carol F.
Relihan, and each of them separately, proxies with the power of substitution to
each, and hereby authorizes them to represent and to vote, as designated below,
at the Annual Meeting of Shareholders of the Fund indicated above, on February
7, 1997 at 2 p.m. Central time, and at any adjournment thereof, all of the
shares of the Fund which the undersigned would be entitled to vote if personally
present. IF THIS PROXY IS SIGNED AND RETURNED WITH NO CHOICES INDICATED, THE
SHARES WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ON THIS PROXY AND
FOR APPROVAL OF THE OTHER PROPOSALS.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
ON THIS PROXY CARD. All joint owners should
sign. When signing as executor, administrator,
attorney, trustee or guardian or as custodian
for a minor, please give full title as such.
If a corporation, please sign in full
corporate name and indicate the signer's
office. If a partner, sign in the partnership
name.
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
___________________________________________
Date
GROUP D
<PAGE> 60
<TABLE>
<S> <C> <C> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS/TRUSTEES. THE DIRECTORS/TRUSTEES RECOMMEND VOTING "FOR" ALL PROPOSALS.
1. ELECTION OF DIRECTORS/TRUSTEES -- To Withhold Authority to vote for any individual nominee,
strike a line through the name below.
FOR ALL | | WITHHOLD AUTHORITY | | TO VOTE FILL IN BOX COMPLETELY
NOMINEES | | FOR ALL NOMINEES | |
except as marked below
Nominees: Charles T. Bauer Bruce L. Crockett Owen Daly II Carl Frischling Robert H. Graham
John F. Kroeger Lewis F. Pennock Ian W. Robinson Louis S. Sklar
FOR AGAINST ABSTAIN
2. Proposal to approve a new Master Investment Advisory Agreement for the Fund. / / / / / /
3. Proposal to eliminate fundamental investment policy prohibiting or restricting / / / / / /
investments in other investment companies and/or to amend certain related
fundamental investment policies.
4. Proposal to ratify the selection of KPMG Peat Marwick LLP as independent / / / / / /
accountants for the Fund.
5. IN THE DISCRETION OF SUCH PROXIES, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
</TABLE>
GROUP D
<PAGE> 61
PROXY PROXY
CASH RESERVE PORTFOLIO
A SERIES OF TAX-FREE INVESTMENTS CO.
PROXY SOLICITED BY THE BOARD OF DIRECTORS/TRUSTEES
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS -- FEBRUARY 7, 1997
The undersigned hereby appoints Charles T. Bauer, Robert H. Graham and Carol F.
Relihan, and each of them separately, proxies with the power of substitution to
each, and hereby authorizes them to represent and to vote, as designated below,
at the Annual Meeting of Shareholders of the Fund indicated above, on February
7, 1997 at 2 p.m. Central time, and at any adjournment thereof, all of the
shares of the Fund which the undersigned would be entitled to vote if personally
present. IF THIS PROXY IS SIGNED AND RETURNED WITH NO CHOICES INDICATED, THE
SHARES WILL BE VOTED FOR THE ELECTION OF THE NOMINEES NAMED ON THIS PROXY AND
FOR APPROVAL OF THE OTHER PROPOSALS.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS
ON THIS PROXY CARD. All joint owners should
sign. When signing as executor, administrator,
attorney, trustee or guardian or as custodian
for a minor, please give full title as such.
If a corporation, please sign in full
corporate name and indicate the signer's
office. If a partner, sign in the partnership
name.
___________________________________________
Signature
___________________________________________
Signature (if held jointly)
___________________________________________
Date
GROUP D
<PAGE> 62
<TABLE>
<S> <C> <C> <C>
THIS PROXY IS SOLICITED ON BEHALF OF THE DIRECTORS/TRUSTEES. THE DIRECTORS/TRUSTEES RECOMMEND VOTING "FOR" ALL PROPOSALS.
1. ELECTION OF DIRECTORS/TRUSTEES -- To Withhold Authority to vote for any individual nominee,
strike a line through the name below.
FOR ALL | | WITHHOLD AUTHORITY | | TO VOTE FILL IN BOX COMPLETELY
NOMINEES | | FOR ALL NOMINEES | |
except as marked below
Nominees: Charles T. Bauer Bruce L. Crockett Owen Daly II Carl Frischling Robert H. Graham
John F. Kroeger Lewis F. Pennock Ian W. Robinson Louis S. Sklar
FOR AGAINST ABSTAIN
2. Proposal to approve a new Master Investment Advisory Agreement for the Fund. / / / / / /
3. Proposal to eliminate fundamental investment policy prohibiting or restricting / / / / / /
investments in other investment companies and/or to amend certain related
fundamental investment policies.
4. Proposal to ratify the selection of KPMG Peat Marwick LLP as independent / / / / / /
accountants for the Fund.
5. IN THE DISCRETION OF SUCH PROXIES, UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
</TABLE>
GROUP D
