<PAGE> 1
AIM GLOBAL
GROWTH FUND
[AIM LOGO APPEARS HERE] SEMIANNUAL REPORT APRIL 30, 1998
<PAGE> 2
-------------------------------------
AIM GLOBAL GROWTH FUND
For shareholders who seek
long-term growth of capital.
The Fund invests in a portfolio
of global equity securities
of companies with
strong earnings momentum.
-------------------------------------
ABOUT FUND PERFORMANCE AND PORTFOLIO DATA THROUGHOUT THIS REPORT:
o AIM Global Growth Fund's performance figures are historical and reflect
reinvestment of all distributions and changes in net asset value. Unless
otherwise indicated, the Fund's performance is computed without a sales
charge.
o When sales charges are included in performance figures, Class A share
performance reflects the maximum 4.75% sales charge, and Class B and Class C
share performance reflects the applicable contingent deferred sales charge
(CDSC) for the period involved. The CDSC on Class B shares declines from 5%
beginning at the time of purchase to 0% at the beginning of the seventh
year. The CDSC on Class C shares is 1% for the first year after purchase.
The performance of the Fund's Class B and Class C shares will differ from
that of Class A shares due to differing fees and expenses.
o Because Class C shares have been offered for less than one year (since
8/4/97), all total return figures for Class C shares reflect cumulative
total return that has not been annualized.
o The Fund's average annual total returns, including sales charges, for
periods ended 3/31/98 (the most recent calendar quarter-end) are as follows:
For Class A shares, one year, 24.86%; since inception 9/15/94, 19.73%. For
Class B shares, one year, 25.28%; since inception 9/15/94, 20.23%. For C
shares, cumulative total return since inception 8/4/97, 9.20%.
o The Fund's portfolio composition is subject to change and there is no
assurance the Fund will continue to hold any particular security.
o Past performance cannot guarantee comparable future results.
o The Fund's investment return and principal value will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
o International investing presents certain risks not associated with investing
solely in the U.S. These include risks relating to fluctuations in the value
of the U.S. dollar relative to the value of other currencies, the custody
arrangements made for the Fund's foreign holdings, differences in
accounting, political risks, and the lesser degree of public information
required to be provided by non-U.S. companies.
ABOUT INDEXES AND OTHER PERFORMANCE BENCHMARKS CITED IN THIS REPORT:
o The Morgan Stanley Capital International World Index is a group of unmanaged
global securities tracked by Morgan Stanley Capital International.
o The Dow Jones Industrial Average (DJIA) is a price-weighted average of 30
actively traded primarily industrial stocks.
o An investment cannot be made in any index. Unless otherwise indicated, index
results include reinvested dividends and do not reflect sales charges.
MUTUAL FUNDS, ANNUITIES, AND OTHER INVESTMENTS ARE NOT INSURED BY THE
FDIC OR ANY OTHER GOVERNMENT AGENCY; ARE NOT DEPOSITS OR OTHER
OBLIGATIONS OF, OR GUARANTEED BY, ANY BANK OR ANY AFFILIATE;
AND ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE
LOSS OF PRINCIPAL AMOUNT INVESTED.
This report may be distributed only to current shareholders or to persons
who have received a current prospectus of the Fund.
<PAGE> 3
The Chairman's Letter
Dear Fellow Shareholder:
Last October, equity markets worldwide had just been shaken
[PHOTO OF by the currency crisis in Southeast Asia. By the April 30,
Charles T. 1998, end of this reporting period, most markets had
Bauer, recovered nicely, with domestic equities reaching new highs
Chairman of and European markets outdoing even the U.S.'s heady pace.
the Board of Only Asian markets remained in the doldrums. Bonds have
THE FUND turned in a solid performance with generous real returns,
APPEARS HERE] though not as spectacular as some had predicted when the
Asian crisis first broke.
However, by the close of this reporting period, many
market participants were uneasy. Some participants fretted
about signs of speculative fever, particularly in U.S. stock
markets, where equity prices continued to rise despite
evidence that earnings growth, especially for larger
companies, had slowed considerably. The growth of European
markets also exceeded everyone's expectations, and some
wondered how long the rise could continue. All were aware that the Asian story
was not yet completed, and no one was certain how serious its ultimate impact
would be.
Of course, bull markets do end, and markets became less ebullient shortly
after this reporting period closed. For investors, the best course is to remain
realistic and ready. A well-diversified portfolio is still one of the most
effective tools for coping with shifts in a market's direction because different
asset classes and different national markets tend to move independently of one
another. Of course, your financial consultant remains your best source of
information about how to allocate your investments based on your particular
goals and situation.
AIM FURTHER DIVERSIFIES ITS OFFERINGS
Shortly after the close of this reporting period, AIM broadened its offerings to
shareholders through the addition of the GT Global group of mutual funds. During
the next few months you will be receiving more details about this transaction
and the products it adds to The AIM Family of Funds--Registered Trademark--.
In addition to making a more varied group of investments available to our
shareholders, this transaction helps strengthen AIM's position as a major
participant in the money-management industry worldwide. Such strength will
enable us to continue expanding both the scope of our fund offerings and our
menu of services for our shareholders.
YOUR FUND MANAGERS COMMENT
On the pages that follow, the managers of your AIM Fund discuss how the Fund
performed during the six months covered by this report and give their near-term
market outlook. We hope you will find their discussion informative.
We are pleased to send you this report on your Fund. If you have any
questions or comments, please contact our Client Services department at
800-959-4246 or visit our Web site at www.aimfunds.com. You can access
information about your account on our Web site and also on our automated AIM
Investor Line, 800-246-5463.
Thank you for your continued participation in The AIM Family of Funds
- --Registered Trademark--.
Sincerely,
/s/ CHARLES T. BAUER
Charles T. Bauer
Chairman
<PAGE> 4
The Managers' Overview
EUROPEAN MARKETS AND U.S. BLUE CHIPS
CONTINUE TO DOMINATE WORLD EQUITIES
A roundtable discussion with the Fund management team for AIM Global Growth Fund
about the six-month reporting period ended April 30, 1998.
- --------------------------------------------------------------------------------
Q. HOW DID THE FUND PERFORM DURING THE SIX-MONTH REPORTING PERIOD?
A. The Fund posted another impressive period of performance. Total return was
18.81% for Class A shares, 18.49% for Class B shares, and 18.43% for Class C
shares for the six-month period ended April 30, 1998. The Fund's performance
was right in line with the Morgan Stanley Capital International (MSCI) World
Index gain of 18.86% during the reporting period.
Q. WHAT ACCOUNTED FOR THE FUND'S STRONG PERFORMANCE DURING THE PAST SIX MONTHS?
A. The impressive performance by European stocks was the story among
international equities during the past six months. European markets
continued to rise dramatically as markets there comprised all of the 10
top-performing international markets during the six-month period ended April
30, 1998. Spain led the way with an astounding 54.57% return, followed by
Portugal with a 52.89% advance. Furthermore, eight of the Fund's top 10
holdings were European companies. Almost 43% of the Fund's portfolio was
invested in European equities at the end of the reporting period.
In the United States, the stock market was still feeling the effects of
the Asian currency crisis during the first three months of the reporting
period. Markets were slow to recover from a significant drop in October,
just before the reporting period began, as investors were concerned about
the impact of the Asian currency devaluations on corporate profits around
the globe.
However, in the U.S. and most other developed countries, the economic
fundamentals remained sound. While the economy grew at a brisk pace,
inflation and interest rates - two forces that could potentially undermine
corporate profits - continued to be low. In this environment, the Dow Jones
Industrial Average (DJIA) resumed its upward climb in late January and broke
the 9000 point mark in April to set a record.
Q. IN THIS ENVIRONMENT, HOW DID LARGE-CAP STOCKS FARE?
A. When markets skyrocketed in the second half of the reporting period,
large-cap stocks--particularly the stocks of the very largest companies, the
so-called Omega caps--led the charge. In the uncertain market environment
created by the Asian currency crisis, investors gravitated to the stocks of
large, well-known companies such as General Electric Co., IBM, and Procter &
Gamble Co., which were represented in the Fund's portfolio. Additionally,
foreign investors were attracted to the equities of these large American
companies with global reputations. Just over 34% of the Fund was positioned
in the United States at the end of the reporting period.
Q. WHY DID EUROPEAN MARKETS PERFORM SO WELL DURING THE REPORTING PERIOD?
A. The European Economic and Monetary Union, or EMU, is scheduled to begin on
January 1, 1999. In order to qualify for the EMU, European nations must
adopt strict budgetary guidelines and improve their finances. This process
has lowered interest rates and kept inflation--the thief of wealth--at bay.
With 11 countries expected to join the EMU next year, this economic
restructuring has triggered a bull market unlike any before seen in Europe.
Q. WERE THERE ANY OTHER FACTORS DRIVING THE EUROPEAN MARKETS?
A. We believe there were four fundamental, long-term themes that fueled this
incredible rally in Europe: privatization of state-run companies, increased
economic freedoms in Eastern Europe, corporate restructuring, and the growth
of investing in European markets.
Many state-run companies and industries have moved into private hands,
such as Telecom Italia S.p.A. and Portugal Telecom, two large holdings in
the Fund's portfolio. Additionally, the economic freedoms in Eastern Europe
have created a new market of consumers and sparked a wave of entrepreneurial
efforts in the former Communist Bloc countries. Once capitalism is planted
it can grow very quickly, and we have seen this since the fall of the Berlin
Wall.
The restructuring by "Corporate Europe" has made companies leaner and
================================================================================
MORNINGSTAR RATINGS (CLASS A SHARES)
- --------------------------------------------------------------------------------
As of 4/30/98
AIM GLOBAL FUNDS IN
PERIOD GROWTH FUND INTERNATIONAL
RATING CATEGORY
OVERALL ***** N/A
3 YEARS ***** 740
================================================================================
*Morningstar proprietary ratings reflect risk-adjusted performance through April
30, 1998. The ratings are subject to change every month. Ratings are calculated
from the funds' three-, five-, and 10-year returns (with fee adjustments) in
excess of 90-day Treasury bill returns, and a risk factor that reflects
performance below 90-day T-bill returns. If a fund scores in the top 10% of its
rating category it earns five stars, the next 22.5% receive four stars, the
middle 35% receive three stars, the next 22.5% receive two stars, and the bottom
10% receive one star.
================================================================================
--------------------------------
The impressive performance by
European stocks was the story among
international equities during the past
six months.
--------------------------------
See important fund and index disclosures inside front cover.
2
<PAGE> 5
PORTFOLIO COMPOSITION
As of April 30, 1998, based on total net assets
<TABLE>
<CAPTION>
==============================================================================================================================
TOP 10 EQUITY HOLDINGS TOP 10 COUNTRIES TOP 10 INDUSTRIES
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Volkswagen A. G. (Germany) 0.95% 1. United States 34.62% 1. Banks (Major Regional) 7.71
2. Banco Bilbao Vizcaya, S.A. (Spain) 0.75 2. United Kingdom 9.80 2. Computer 5.55
(Software & Services)
3. MCI Communications Corp. 0.75 3. France 8.45 3. Manufacturing 4.18
(Diversified)
4. Nokia Oyj A.B. - Class A (Finland) 0.75 4. Japan 5.07 4. Telecommunications 3.72
(Cellular/Wireless)
5. Cap Gemini Sogeti S.A. (France) 0.70 5. Germany 4.42 5. Telephone 3.63
6. Panamerican Beverages, Inc.- 0.68 6. Canada 3.68 6. Services 3.25
Class A (Mexico) (Commercial & Consumer)
7. Vodafone Group PLC (United Kingdom) 0.65 7. Italy 3.53 7. Insurance (Multi-Line) 3.12
8. Credit Suisse Group (Switzerland) 0.63 8. Mexico 3.15 8. Financial (Diversified) 2.35
9. Alcatel Alsthom (France) 0.63 9. Netherlands 2.99 9. Retail (Food Chains) 2.28
10. Accor S.A. (France) 0.61 10. Switzerland 2.76 10. Automobiles 2.21
Please keep in mind that the Fund's portfolio is subject to change and there is
no assurance the Fund will continue to hold any particular security.
==============================================================================================================================
</TABLE>
more globally competitive. We have seen immediate results of this
restructuring as European earnings growth continued to be strong during the
reporting period. Finally, thousands of Europeans have discovered the
wonders of investing in equities. As money has flowed into European markets,
the markets themselves have become larger and more liquid than ever before.
Q. HOW WAS THE PORTFOLIO POSITIONED THROUGHOUT THE REST OF THE WORLD?
A. The Fund finished the reporting period with 5.1% of its net assets in Japan,
3.2% in Asia and Australia, and 7% in Latin America. These three regions
were decimated by the "Asian Flu" last fall and have been slow to recover.
In the first quarter, many of the Asian markets did bounce off their
bottoms, some as much as 40%, but keep in mind they were coming off very low
levels. What occurred in the last quarter of 1997 was devastating to those
fragile emerging markets, and we believe it's going to take quite some time
for Asia to fully recover from the economic crisis of last autumn.
Q. WHY IS THE JAPANESE ECONOMY IN SUCH AN ECONOMIC MALAISE?
A. Although it seems apparent to the rest of the world that real economic
reform is needed in Japan, the Japanese government has been extremely
reluctant to institute any fiscal stimulus or tax cuts to get their economy
out of the economic gutter. Until the government takes some real action to
jump-start the economy, there is no real reason to be significantly weighted
in Japan. We continue to own recognizable Japanese companies such as Honda
Motor Company and Sony Corp., but the Japanese market has significantly
underperformed the rest of the world for some time now. The Japanese market
was off more than 10% during the reporting period.
Q. IN WHICH INDUSTRIES WAS THE FUND POSITIONED?
A. The Fund's largest industry position was major regional banks with over 7%
of net assets. Although one may not think of banking as a growth industry,
we have seen excellent earnings growth in this industry, especially in
Europe. Banking positions owned by the Fund included the Royal Bank of
Canada, Switzerland's Credit Suisse Group, and France's Societe Generale.
To no one's surprise during this age of technology, the computer
software and services sector commanded over 5% of the Fund's portfolio. The
Fund was attracted to such recognizable technology companies as Dell
Computer Corp., Compaq Computer Corp., America Online, and Cisco Systems,
Inc. Finally, automobile companies comprised over 2% of the portfolio with
the German automaker Volkswagen A. G. having the honor of being the Fund's
largest single holding at 0.95%.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND IN THE NEAR TERM?
A. We are still very positive on the United States and Europe, and very
cautious on the Pacific Rim. Conditions worldwide remain very good for
equities, although it is unrealistic to expect continued equity returns of
20% or more. Things may continue to worsen in Asia before those markets
experience a recovery, so we do not anticipate our Asian weightings to
increase any time soon. In Europe, though, we believe there will continue to
be faster earnings growth with better valuations than in the United States,
because Europe's cash-to-price earnings, price-to-book, price-to-dividend,
and P/E ratios all are lower than in the U.S. The economic outlook in Latin
America seems positive as well, although the markets there struggled during
the six-month reporting period.
The economic indicators in the U.S. remain positive, and that is good
for markets around the world because they often take their lead from the
U.S. As long as we continue to see the combination of low inflation and low
interest rates around the globe, the short-term outlook for global equities
will remain promising.
See important fund and index disclosures inside front cover.
3
<PAGE> 6
AIM GLOBAL GROWTH FUND VS. BENCHMARK INDEX
The chart below compares your Fund to a benchmark index. It is intended to give
you a general idea of how your Fund performed compared to the stock market over
the period 9/15/94 to 4/30/98. It is important to understand the difference
between your Fund and an index. Your Fund's total return is shown with a sales
charge and includes fund expenses and management fees. An index measures the
performance of a hypothetical portfolio, in this case the Morgan Stanley Capital
International World Index. Unlike your Fund, an index is not managed; therefore,
there are no sales charges, expenses, or fees. You cannot invest in an index.
But if you could buy all the securities that make up a particular index, you
would incur expenses that would affect the return on your investment.
===============================================================================
AVERAGE ANNUAL TOTAL RETURNS
As of 4/30/98. Including sales charges.
CLASS A SHARES
Inception (9/15/94) 19.69%
1 year 24.89
CLASS B SHARES
Inception (9/15/94) 20.18%
1 year 25.43
CLASS C SHARES
Inception (8/4/97) 10.62%*
*Total return provided is cumulative total
return that has not been annualized.
===============================================================================
Past performance is no guarantee of comparable future results
===============================================================================
A B MSCI
- -------------------------------------------------------------------------------
9/15/94 $10,000.00 $ 9,524.00 $10,000.00
4/30/95 $10,550.00 $10,090.00 $10,749.00
4/30/96 $13,797.00 $13,241.00 $12,759.00
4/30/97 $15,150.00 $14,627.00 $14,079.00
4/30/98 $19,460.00 $19,175.00 $18,166.00
- --------------------------------------------------------------------------------
Your Fund's total return include sales charges, expenses, and management fees.
For Fund performance calculations and descriptions of indexes cited on this
page, please refer to the inside front cover. The performance of the Fund's
Class C shares will differ from that of Class A and B shares due to differing
fees and expenses. Source: Towers Data Systems Hypo--Registered Trademark--.
4
<PAGE> 7
For Consideration
THE ROTH IRA: THE POWER TO KEEP MORE
Contribute After-Tax Dollars Now...So You Can Get Federally Tax-Free Savings
Later
- -------------------------------------------------------------------------------
A new and potentially more powerful type of IRA--the Roth IRA--became available
on January 1, 1998. What makes it more powerful? The Roth IRA gives you the
opportunity to keep more of what you earn.
Are you eligible to open a Roth IRA? The answer is yes if you or your spouse
has earned income for the tax year for which you want to make the contribution,
and your adjusted gross income is below $110,000 if you are a single tax filer,
$160,000 if you file jointly.
TWO KEY ROTH IRA BENEFITS:
TAX-FREE AND PENALTY-FREE WITHDRAWALS
o Of earnings after five years. Earnings on your Roth IRA are federally
tax-free if your Roth IRA account has been open for five years and you are at
least 59 1/2 years old, or in the case of death or disability. You may also use
up to $10,000 of your earnings to buy a first home (after five years).
o Of contributions at any time. For instance, if you make annual contributions
of $2,000 for the next three years, you may take out up to $6,000 and use that
money for any purpose.
HOW YOU MIGHT PUT BOTH BENEFITS TO WORK FOR YOU
Here's an example of how you may take full advantage of a Roth IRA. You are 39
1/2 years old. You contribute $2,000 after-tax annually in your Roth IRA every
year for 20 years, earning an average annual return of 10%. After 20 years, your
account has grown to $126,005. Now at age 59 1/2 you can begin taking
withdrawals and pay no federal income tax or penalty on any of your $126,005. Or
you can keep your money invested and take it out whenever you need it.
THE ROTH IRA: TO CONVERT OR NOT TO CONVERT
Can you convert your Traditional IRA to a Roth IRA? The answer is yes if you
meet these requirements:
You must pay taxes on the amount you convert. If you convert in 1998, you
can spread your tax payments over the next four years. This four-year allowance
will not be available after December 31, 1998.
You cannot convert to a Roth IRA if you are married and file your tax return
separately, or if your annual gross income is over $100,000.
SOME ROTH IRA CONVERSION GUIDELINES
If you can check most of these boxes,
converting your Traditional IRA to a Roth IRA may make sense for you.
- -------------------------------------------------------------------------------
o You have assets outside your retirement savings with which you can easily
afford to pay the taxes due when you convert.
o You have 10 years or more before you retire. The longer you invest tax-free,
the more you benefit.
o Your tax rate will probably be higher in retirement than it is now. If so,
you'll pay less taxes now to convert than you would pay at retirement if you
withdrew from a traditional IRA.
o You plan to convert in 1998. On January 1, 1999, the ability to spread tax
payments over four years disappears.
o You want to keep making contributions after age 70 1/2 and may wish to pass
your IRA assets on to your heirs after your death.
ROTH IRA CALCULATOR & ANALYZER
The Roth IRA Analyzer & Calculator at AIM's Internet Web site
- --www.aimfunds.com-- can help you determine your IRA eligibility status and
whether it makes sense for you to convert an existing IRA into a Roth IRA.
MAKE YOUR IRA CONVERSION DECISION A TRULY INFORMED ONE
Talk to your financial consultant, who knows your specific needs and goals. You
may also wish to talk with a tax adviser.
This discussion does not constitute tax advice. Your tax adviser can provide
guidance concerning your particular situation.
5
<PAGE> 8
SCHEDULE OF INVESTMENTS
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
DOMESTIC COMMON STOCKS-34.62%
AEROSPACE/DEFENSE-0.41%
Sundstrand Corp. 30,000 $ 2,071,875
- ---------------------------------------------------------------
AGRICULTURAL PRODUCTS-0.19%
Universal Corp. 26,000 973,375
- ---------------------------------------------------------------
AUTO PARTS & EQUIPMENT-0.32%
Federal-Mogul Corp. 25,000 1,617,187
- ---------------------------------------------------------------
BANKS (MONEY CENTER)-1.00%
BankAmerica Corp. 14,200 1,207,000
- ---------------------------------------------------------------
Chase Manhattan Corp. (The) 11,500 1,593,469
- ---------------------------------------------------------------
Citicorp 15,000 2,257,500
- ---------------------------------------------------------------
5,057,969
- ---------------------------------------------------------------
BROADCASTING (TELEVISION, RADIO &
CABLE)-1.06%
CBS Corp. 50,000 1,781,250
- ---------------------------------------------------------------
Comcast Corp.-Class A 50,000 1,790,625
- ---------------------------------------------------------------
Tele-Communications, Inc.(a) 55,000 1,773,750
- ---------------------------------------------------------------
5,345,625
- ---------------------------------------------------------------
COMMUNICATIONS EQUIPMENT-0.65%
Lucent Technologies, Inc. 31,000 2,359,875
- ---------------------------------------------------------------
Tellabs, Inc.(a) 13,000 921,375
- ---------------------------------------------------------------
3,281,250
- ---------------------------------------------------------------
COMPUTERS (HARDWARE)-1.47%
Compaq Computer Corp.(a) 45,500 1,276,844
- ---------------------------------------------------------------
Dell Computer Corp.(a) 30,000 2,422,500
- ---------------------------------------------------------------
Gateway 2000, Inc.(a) 40,500 2,376,844
- ---------------------------------------------------------------
International Business Machines
Corp. 11,500 1,332,563
- ---------------------------------------------------------------
7,408,751
- ---------------------------------------------------------------
COMPUTERS (NETWORKING)-0.22%
Cisco Systems, Inc.(a) 15,000 1,098,750
- ---------------------------------------------------------------
COMPUTERS (PERIPHERALS)-0.45%
EMC Corp.(a) 50,000 2,306,250
- ---------------------------------------------------------------
COMPUTERS (SOFTWARE &
SERVICES)-2.65%
America Online, Inc.(a) 37,000 2,960,000
- ---------------------------------------------------------------
BMC Software, Inc.(a) 21,000 1,964,812
- ---------------------------------------------------------------
Computer Associates
International, Inc. 28,500 1,669,031
- ---------------------------------------------------------------
Computer Sciences Corp.(a) 32,000 1,688,000
- ---------------------------------------------------------------
Compuware Corp.(a) 42,000 2,052,750
- ---------------------------------------------------------------
Concord EFS, Inc.(a) 28,500 897,750
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMPUTERS (SOFTWARE & SERVICES)-(CONTINUED)
Microsoft Corp.(a) 24,000 $ 2,163,000
- ---------------------------------------------------------------
13,395,343
- ---------------------------------------------------------------
CONSUMER FINANCE-0.59%
FIRSTPLUS Financial Group,
Inc.(a) 50,000 2,425,000
- ---------------------------------------------------------------
SLM Holding Corp. 13,200 563,475
- ---------------------------------------------------------------
2,988,475
- ---------------------------------------------------------------
DISTRIBUTORS (FOOD & HEALTH)-0.84%
AmeriSource Health Corp.-Class
A(a) 29,200 1,591,400
- ---------------------------------------------------------------
Bergen Brunswig Corp.-Class A 35,600 1,615,350
- ---------------------------------------------------------------
Cardinal Health, Inc. 10,650 1,025,062
- ---------------------------------------------------------------
4,231,812
- ---------------------------------------------------------------
ELECTRICAL EQUIPMENT-0.51%
General Electric Co. 20,000 1,702,500
- ---------------------------------------------------------------
Symbol Technologies, Inc. 22,500 866,250
- ---------------------------------------------------------------
2,568,750
- ---------------------------------------------------------------
ELECTRONICS (INSTRUMENTATION)-0.27%
Waters Corp.(a) 25,000 1,337,500
- ---------------------------------------------------------------
ELECTRONICS (SEMICONDUCTORS)-0.67%
Altera Corp.(a) 40,500 1,640,250
- ---------------------------------------------------------------
Intel Corp. 21,800 1,761,713
- ---------------------------------------------------------------
3,401,963
- ---------------------------------------------------------------
ENTERTAINMENT-0.31%
Viacom, Inc.-Class B(a) 27,100 1,571,800
- ---------------------------------------------------------------
EQUIPMENT (SEMICONDUCTOR)-1.20%
Applied Materials, Inc.(a) 43,000 1,553,375
- ---------------------------------------------------------------
KLA-Tencor Corp.(a) 35,000 1,410,938
- ---------------------------------------------------------------
Lam Research Corp.(a) 57,000 1,767,000
- ---------------------------------------------------------------
Teradyne, Inc.(a) 36,000 1,314,000
- ---------------------------------------------------------------
6,045,313
- ---------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-1.51%
American Express Co. 15,000 1,530,000
- ---------------------------------------------------------------
Fannie Mae 27,200 1,628,600
- ---------------------------------------------------------------
Freddie Mac 39,000 1,806,187
- ---------------------------------------------------------------
MBIA, Inc. 2,400 179,100
- ---------------------------------------------------------------
MGIC Investment Corp. 6,700 422,100
- ---------------------------------------------------------------
Morgan Stanley, Dean Witter,
Discover & Co. 25,900 2,042,863
- ---------------------------------------------------------------
7,608,850
- ---------------------------------------------------------------
FOODS-0.16%
Keebler Foods Co.(a) 28,000 798,000
- ---------------------------------------------------------------
</TABLE>
6
<PAGE> 9
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
HARDWARE & TOOLS-0.33%
Black & Decker Corp. (The) 32,500 $ 1,677,812
- ---------------------------------------------------------------
HEALTH CARE (DIVERSIFIED)-1.19%
Abbott Laboratories 19,400 1,418,625
- ---------------------------------------------------------------
Bristol-Myers Squibb Co. 11,500 1,217,562
- ---------------------------------------------------------------
Johnson & Johnson 19,500 1,391,813
- ---------------------------------------------------------------
Warner-Lambert Co. 10,500 1,986,469
- ---------------------------------------------------------------
6,014,469
- ---------------------------------------------------------------
HEALTH CARE (DRUGS-GENERIC & OTHER)-0.31%
Watson Pharmaceuticals, Inc.(a) 35,800 1,539,400
- ---------------------------------------------------------------
HEALTH CARE (DRUGS-MAJOR
PHARMACEUTICALS)-0.81%
Merck & Co., Inc. 16,500 1,988,250
- ---------------------------------------------------------------
Pfizer Inc. 4,200 478,013
- ---------------------------------------------------------------
Schering-Plough Corp. 20,000 1,602,500
- ---------------------------------------------------------------
4,068,763
- ---------------------------------------------------------------
HEALTH CARE (LONG TERM CARE)-0.51%
HEALTHSOUTH Corp.(a) 41,000 1,237,687
- ---------------------------------------------------------------
Quorum Health Group, Inc.(a) 41,250 1,325,156
- ---------------------------------------------------------------
2,562,843
- ---------------------------------------------------------------
HEALTH CARE (MEDICAL PRODUCTS &
SUPPLIES)-1.85%
Arterial Vascular Engineering,
Inc.(a) 53,000 1,874,875
- ---------------------------------------------------------------
Baxter International Inc. 24,900 1,380,394
- ---------------------------------------------------------------
Biomet, Inc. 46,800 1,404,000
- ---------------------------------------------------------------
Guidant Corp. 24,000 1,605,000
- ---------------------------------------------------------------
Medtronic, Inc. 32,000 1,684,000
- ---------------------------------------------------------------
Stryker Corp. 17,600 792,000
- ---------------------------------------------------------------
Sybron International Corp.(a) 21,400 567,100
- ---------------------------------------------------------------
9,307,369
- ---------------------------------------------------------------
HOUSEHOLD FURNITURE & APPLIANCES-0.23%
Maytag Corp. 22,200 1,143,300
- ---------------------------------------------------------------
HOUSEHOLD PRODUCTS (NON-DURABLES)-0.54%
Dial Corp. (The) 51,000 1,243,125
- ---------------------------------------------------------------
Procter & Gamble Co. (The) 18,000 1,479,375
- ---------------------------------------------------------------
2,722,500
- ---------------------------------------------------------------
HOUSEWARES-0.20%
Sunbeam Corp. 40,000 1,005,000
- ---------------------------------------------------------------
INSURANCE (LIFE/HEALTH)-0.32%
Torchmark Corp. 36,500 1,626,531
- ---------------------------------------------------------------
INSURANCE (MULTI-LINE)-1.01%
Ace, Ltd. 30,000 1,136,250
- ---------------------------------------------------------------
Allmerica Financial Corp. 33,000 2,066,625
- ---------------------------------------------------------------
American International Group,
Inc. 5,250 690,703
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INSURANCE (MULTI-LINE)-(CONTINUED)
Travelers Group, Inc. 19,500 $ 1,193,156
- ---------------------------------------------------------------
5,086,734
- ---------------------------------------------------------------
INSURANCE (PROPERTY-CASUALTY)-0.09%
Everest Reinsurance Holdings,
Inc. 11,300 466,125
- ---------------------------------------------------------------
INVESTMENT BANKING/BROKERAGE-0.38%
Merrill Lynch & Co., Inc. 22,000 1,930,500
- ---------------------------------------------------------------
INVESTMENT MANAGEMENT-0.43%
Franklin Resources, Inc. 11,800 631,300
- ---------------------------------------------------------------
T. Rowe Price Associates, Inc. 20,500 1,547,750
- ---------------------------------------------------------------
2,179,050
- ---------------------------------------------------------------
LEISURE TIME (PRODUCTS)-0.55%
Harley-Davidson, Inc. 47,400 1,706,400
- ---------------------------------------------------------------
Mattel, Inc. 27,000 1,034,438
- ---------------------------------------------------------------
2,740,838
- ---------------------------------------------------------------
LODGING-HOTELS-0.08%
Promus Hotel Corp.(a) 8,700 393,131
- ---------------------------------------------------------------
MANUFACTURING (DIVERSIFIED)-1.06%
Thermo Electron Corp.(a) 26,000 1,035,125
- ---------------------------------------------------------------
Tyco International Ltd. 16,000 872,000
- ---------------------------------------------------------------
United Technologies Corp. 19,000 1,870,313
- ---------------------------------------------------------------
U.S. Industries, Inc. 57,050 1,547,481
- ---------------------------------------------------------------
5,324,919
- ---------------------------------------------------------------
OIL & GAS (DRILLING & EQUIPMENT)-1.70%
Cooper Cameron Corp.(a) 23,500 1,561,281
- ---------------------------------------------------------------
Diamond Offshore Drilling, Inc. 30,000 1,518,750
- ---------------------------------------------------------------
ENSCO International, Inc. 40,000 1,130,000
- ---------------------------------------------------------------
Halliburton Co. 23,000 1,265,000
- ---------------------------------------------------------------
Santa Fe International Corp. 35,000 1,371,562
- ---------------------------------------------------------------
Western Atlas Inc.(a) 22,000 1,738,000
- ---------------------------------------------------------------
8,584,593
- ---------------------------------------------------------------
PERSONAL CARE-0.67%
Avon Products, Inc. 19,400 1,594,437
- ---------------------------------------------------------------
Gillette Co. (The) 15,500 1,789,281
- ---------------------------------------------------------------
3,383,718
- ---------------------------------------------------------------
REAL ESTATE INVESTMENT TRUST-0.39%
Starwood Hotels & Resorts 38,996 1,957,112
- ---------------------------------------------------------------
RETAIL (BUILDING SUPPLIES)-0.35%
Lowe's Companies, Inc. 25,500 1,783,407
- ---------------------------------------------------------------
RETAIL (COMPUTERS & ELECTRONICS)-0.28%
Circuit City Stores-Circuit City
Group 35,000 1,421,875
- ---------------------------------------------------------------
RETAIL (DEPARTMENT STORES)-0.65%
Federated Department Stores,
Inc.(a) 26,000 1,278,875
- ---------------------------------------------------------------
</TABLE>
7
<PAGE> 10
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
RETAIL (DEPARTMENT STORES)-(CONTINUED)
Proffitt's, Inc.(a) 50,000 $ 1,987,500
- ---------------------------------------------------------------
3,266,375
- ---------------------------------------------------------------
RETAIL (DRUG STORES)-0.31%
CVS Corp. 21,000 1,548,750
- ---------------------------------------------------------------
RETAIL (FOOD CHAINS)-1.08%
Albertson's, Inc. 32,000 1,600,000
- ---------------------------------------------------------------
Kroger Co.(a) 50,000 2,093,750
- ---------------------------------------------------------------
Safeway, Inc.(a) 46,000 1,759,500
- ---------------------------------------------------------------
5,453,250
- ---------------------------------------------------------------
RETAIL (GENERAL MERCHANDISE)-0.86%
Fred Meyer, Inc.(a) 34,200 1,534,725
- ---------------------------------------------------------------
Kmart Corp.(a) 100,500 1,752,469
- ---------------------------------------------------------------
Wal-Mart Stores, Inc. 20,900 1,056,756
- ---------------------------------------------------------------
4,343,950
- ---------------------------------------------------------------
RETAIL (SPECIALTY)-0.66%
Bed Bath & Beyond, Inc.(a) 25,000 1,231,250
- ---------------------------------------------------------------
Office Depot, Inc.(a) 64,000 2,120,000
- ---------------------------------------------------------------
3,351,250
- ---------------------------------------------------------------
RETAIL (SPECIALTY-APPAREL)-0.38%
Brylane Inc.(a) 5,900 346,625
- ---------------------------------------------------------------
TJX Companies, Inc. (The) 35,000 1,548,750
- ---------------------------------------------------------------
1,895,375
- ---------------------------------------------------------------
SERVICES (COMMERCIAL & CONSUMER)-0.72%
H&R Block, Inc. 35,000 1,575,000
- ---------------------------------------------------------------
Service Corp. International 49,300 2,033,625
- ---------------------------------------------------------------
3,608,625
- ---------------------------------------------------------------
SERVICES (DATA PROCESSING)-0.54%
Equifax, Inc. 33,300 1,288,294
- ---------------------------------------------------------------
Fiserv, Inc.(a) 21,600 1,412,100
- ---------------------------------------------------------------
2,700,394
- ---------------------------------------------------------------
SERVICES (EMPLOYMENT)-0.11%
AccuStaff, Inc.(a) 16,000 574,000
- ---------------------------------------------------------------
TELECOMMUNICATIONS (LONG DISTANCE)-1.07%
AT&T Corp. 27,000 1,621,687
- ---------------------------------------------------------------
MCI Communications Corp. 75,000 3,773,438
- ---------------------------------------------------------------
5,395,125
- ---------------------------------------------------------------
TEXTILES (APPAREL)-0.25%
Columbia Sportswear Co.(a) 7,000 148,750
- ---------------------------------------------------------------
Tommy Hilfiger Corp.(a) 18,000 1,098,000
- ---------------------------------------------------------------
1,246,750
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
WASTE MANAGEMENT-0.23%
Waste Management, Inc. 34,200 $ 1,145,700
- ---------------------------------------------------------------
Total Domestic Common Stocks
(Cost $131,121,288) 174,558,371
- ---------------------------------------------------------------
FOREIGN STOCKS & OTHER
EQUITY INTERESTS-58.28%
ARGENTINA-1.58%
Banco Rio de La Plata S.A.-ADR
(Banks-Major Regional)(a) 75,000 1,031,250
- ---------------------------------------------------------------
Perez Companc S.A.-Class B (Oil &
Gas-Refining & Marketing) 280,140 1,683,886
- ---------------------------------------------------------------
Telefonica de Argentina S.A.-ADR
(Telephone) 77,000 2,969,313
- ---------------------------------------------------------------
YPF Sociedad Anonima-ADR
(Oil-International Integrated) 65,600 2,287,800
- ---------------------------------------------------------------
7,972,249
- ---------------------------------------------------------------
AUSTRALIA-0.50%
Australia & New Zealand Banking
Group Ltd. (Banks-Major
Regional) 260,087 1,815,676
- ---------------------------------------------------------------
Telstra Corp. Ltd. (Telephone) 304,960 716,077
- ---------------------------------------------------------------
2,531,753
- ---------------------------------------------------------------
AUSTRIA-0.28%
OMV A.G. (Oil & Gas-Refining &
Marketing) 9,400 1,395,129
- ---------------------------------------------------------------
BELGIUM-0.93%
Barco N.V.
(Manufacturing-Diversified) 5,700 1,509,811
- ---------------------------------------------------------------
COLRUYT S.A. (Retail-Food Chains) 1,100 668,955
- ---------------------------------------------------------------
UCB S.A.
(Manufacturing-Diversified) 520 2,486,297
- ---------------------------------------------------------------
4,665,063
- ---------------------------------------------------------------
BRAZIL-1.95%
Companhia Energetica de Minas
Gerais (Electric Companies) 31,000 1,504,394
- ---------------------------------------------------------------
Petroleo Brasileiro
S.A.-Petrobras
(Oil & Gas-Exploration &
Production) 5,416 1,373,231
- ---------------------------------------------------------------
Telecomunicacoes Brasileiras
S.A.-ADR
(Telecommunications-Cellular/Wireless) 26,800 2,659,730
- ---------------------------------------------------------------
Telecomunicacoes do Rio de
Janeiro S.A.
(Telecommunications-Cellular/Wireless) 8,689 1,367,569
- ---------------------------------------------------------------
Telecomunicacoes de Sao Paulo
S.A.-TELESP (Telephone) 8,600 2,925,195
- ---------------------------------------------------------------
9,830,119
- ---------------------------------------------------------------
CANADA-3.68%
Bank of Montreal (Banks-Major
Regional) 20,500 1,118,299
- ---------------------------------------------------------------
BCE Inc.
(Telecommunications-Cellular/Wireless) 58,300 2,483,107
- ---------------------------------------------------------------
Bombardier Inc.
(Aerospace/Defense) 48,000 1,295,800
- ---------------------------------------------------------------
Canadian National Railway Co.
(Railroads) 8,800 572,550
- ---------------------------------------------------------------
Geac Computer Corp. Ltd.
(Services-Computer Systems)(a) 32,000 1,261,111
- ---------------------------------------------------------------
</TABLE>
8
<PAGE> 11
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
CANADA-(CONTINUED)
Imasco Ltd.
(Manufacturing-Diversified) 32,400 $ 1,220,226
- ---------------------------------------------------------------
Mitel Corp. (Communications
Equipment)(a) 125,000 1,774,662
- ---------------------------------------------------------------
Newcourt Credit Group, Inc.
(Financial-Diversified) 35,000 1,719,375
- ---------------------------------------------------------------
Northern Telecom Ltd.-ADR
(Communications Equipment) 8,200 499,175
- ---------------------------------------------------------------
Royal Bank of Canada (Banks-Major
Regional) 36,500 1,930,832
- ---------------------------------------------------------------
Suncor Energy, Inc. (Oil-International
Integrated) 56,000 2,180,019
- ---------------------------------------------------------------
Toronto-Dominion Bank
(Banks-Regional) 54,500 2,488,967
- ---------------------------------------------------------------
18,544,123
- ---------------------------------------------------------------
CHILE-0.34%
Cia. de Telecomunicaciones de
Chile S.A.-ADR (Telephone) 30,600 766,913
- ---------------------------------------------------------------
Quinenco S.A.-ADR
(Financial-Diversified) 89,600 924,000
- ---------------------------------------------------------------
1,690,913
- ---------------------------------------------------------------
DENMARK-0.43%
Novo Nordisk A/S-Class B (Health
Care/Drugs-Generic & Other) 13,500 2,190,197
- ---------------------------------------------------------------
FINLAND-0.75%
Nokia Oyj A.B.-Class A
(Communications Equipment) 56,000 3,756,973
- ---------------------------------------------------------------
FRANCE-8.20%
Accor S.A. (Lodging-Hotels) 11,200 3,053,868
- ---------------------------------------------------------------
Alcatel Alsthom
(Manufacturing-Diversified) 17,000 3,153,386
- ---------------------------------------------------------------
AXA UAP (Insurance-Multi-Line) 11,250 1,321,328
- ---------------------------------------------------------------
Banque Nationale de Paris
(Banks-Major Regional) 21,500 1,813,425
- ---------------------------------------------------------------
Cap Gemini Sogeti S.A.
(Computers-Software & Services) 27,000 3,508,069
- ---------------------------------------------------------------
Compagnie Francaise d'Etudes et
de Construction Technip (Oil &
Gas-Refining & Marketing) 6,500 826,152
- ---------------------------------------------------------------
Danone (Foods) 5,400 1,275,661
- ---------------------------------------------------------------
Elf Aquitaine S.A. (Oil &
Gas-Refining & Marketing) 13,500 1,772,002
- ---------------------------------------------------------------
Essilor International S.A.
(Manufacturing-Specialized) 2,200 889,370
- ---------------------------------------------------------------
Lafarge S.A. (Engineering &
Construction) 23,800 2,248,944
- ---------------------------------------------------------------
Legrand S.A. (Housewares) 5,300 1,401,930
- ---------------------------------------------------------------
Pinault-Printemps-Redoute S.A.
(Retail-General Merchandise) 2,900 2,160,406
- ---------------------------------------------------------------
Promodes (Retail-Food Chains) 4,800 2,313,359
- ---------------------------------------------------------------
PSA Peugeot Citreon (Automobiles) 7,000 1,215,771
- ---------------------------------------------------------------
Renault S.A. (Automobiles)(a) 40,000 1,856,596
- ---------------------------------------------------------------
Rexel S.A. (Distributors-Food &
Health) 2,600 1,044,585
- ---------------------------------------------------------------
Schneider S.A. (Housewares) 29,500 2,208,451
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FRANCE-(CONTINUED)
Societe BIC S.A.
(Office Equipment & Supplies) 12,300 $ 846,737
- ---------------------------------------------------------------
Societe Generale (Banks-Major
Regional) 8,000 1,666,279
- ---------------------------------------------------------------
Sodexho Alliance S.A.
(Services-Commercial &
Consumer) 4,400 805,923
- ---------------------------------------------------------------
Suez Lyonnaise des Eaux
(Manufacturing-Diversified) 14,500 2,460,490
- ---------------------------------------------------------------
Total S.A.-Class B (Oil &
Gas-Refining & Marketing) 13,100 1,558,228
- ---------------------------------------------------------------
Valeo S.A. (Auto Parts &
Equipment) 19,400 1,929,995
- ---------------------------------------------------------------
41,330,955
- ---------------------------------------------------------------
GERMANY-4.42%
Adidas Salomon A.G. (Footwear) 16,350 2,711,178
- ---------------------------------------------------------------
Allianz A.G.
(Insurance-Multi-Line) 4,000 1,230,701
- ---------------------------------------------------------------
Bayerische Vereinsbank A.G.
(Banks-Major Regional) 17,000 1,293,406
- ---------------------------------------------------------------
Continental A.G. (Auto Parts &
Equipment) 29,600 841,425
- ---------------------------------------------------------------
Dresdner Bank A.G. (Banks-Major
Regional) 36,000 1,948,386
- ---------------------------------------------------------------
Henkel KGaA
(Chemicals-Diversified) 7,500 585,252
- ---------------------------------------------------------------
Mannesmann A.G.
(Machinery-Diversified) 2,150 1,706,482
- ---------------------------------------------------------------
Porsche A.G. (Automobiles) 600 1,501,589
- ---------------------------------------------------------------
SAP A.G. (Computers-Software &
Services) 4,600 2,179,366
- ---------------------------------------------------------------
SAP A.G. (Computers-Software &
Services) 4,600 2,294,744
- ---------------------------------------------------------------
VEBA A.G.
(Manufacturing-Diversified) 18,000 1,189,900
- ---------------------------------------------------------------
Volkswagen A.G. (Automobiles) 6,000 4,778,998
- ---------------------------------------------------------------
22,261,427
- ---------------------------------------------------------------
HONG KONG-1.49%
Cosco Pacific Ltd.
(Financial-Diversified) 1,294,000 877,033
- ---------------------------------------------------------------
Hong Kong & China Gas Co. Ltd.
(Natural Gas) 1,183,204 1,611,516
- ---------------------------------------------------------------
HSBC Holdings PLC (Banks-Major
Regional) 63,400 1,808,856
- ---------------------------------------------------------------
Hutchison Whampoa Ltd.
(Retail-Food Chains) 338,000 2,090,137
- ---------------------------------------------------------------
New World Infrastructure Ltd.
(Services-Commercial &
Consumer)(a) 151,800 326,293
- ---------------------------------------------------------------
Ng Fung Hong Ltd. (Foods) 898,000 811,516
- ---------------------------------------------------------------
7,525,351
- ---------------------------------------------------------------
HUNGARY-0.23%
Gedeon Richter (Health
Care-Drugs-Major
Pharmaceuticals)(a) 11,000 1,171,500
- ---------------------------------------------------------------
INDONESIA-0.22%
Gulf Indonesia Resources Ltd.
(Oil-International
Integrated)(a) 71,100 1,093,162
- ---------------------------------------------------------------
IRELAND-0.91%
Allied Irish Banks PLC
(Banks-Regional) 180,000 2,508,449
- ---------------------------------------------------------------
</TABLE>
9
<PAGE> 12
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
IRELAND-(CONTINUED)
Bank of Ireland (Banks-Major
Regional) 75,000 $ 1,531,592
- ---------------------------------------------------------------
Elan Corp. PLC-ADR (Health
Care/Drugs-Generic & Other)(a) 9,000 559,125
- ---------------------------------------------------------------
4,599,166
- ---------------------------------------------------------------
ITALY-3.53%
Assicurazioni Generali
(Insurance/Multi-Line) 92,200 2,761,498
- ---------------------------------------------------------------
Credito Italiano S.p.A.
(Banks-Major Regional) 465,000 2,434,008
- ---------------------------------------------------------------
Ente Nazionale Idrocarburi S.p.A.
(Oil & Gas-Refining &
Marketing) 290,000 1,943,320
- ---------------------------------------------------------------
Istituto Mobiliare Italiano
S.p.A. (Banks-Major Regional) 138,000 2,247,997
- ---------------------------------------------------------------
Pirelli S.p.A. (Electrical
Equipment) 862,187 2,847,916
- ---------------------------------------------------------------
Telecom Italia Mobile S.p.A.
(Telecommunications-
Cellular/Wireless) 460,000 2,635,323
- ---------------------------------------------------------------
Telecom Italia S.p.A. (Telephone) 388,888 2,929,805
- ---------------------------------------------------------------
17,799,867
- ---------------------------------------------------------------
JAPAN-5.07%
Advantest Corp.
(Electronics-Instrumentation) 23,023 1,547,735
- ---------------------------------------------------------------
Bridgestone Corp. (Auto Parts &
Equipment) 101,000 2,303,950
- ---------------------------------------------------------------
Canon, Inc. (Office Equipment &
Supplies) 48,000 1,134,829
- ---------------------------------------------------------------
Fuji Photo Film Co.(Leisure
Time-Products) 30,000 1,067,301
- ---------------------------------------------------------------
Hitachi Cable, Ltd. (Metal
Fabricators) 224,000 1,115,009
- ---------------------------------------------------------------
Honda Motor Co., Ltd.
(Automobiles) 50,000 1,812,826
- ---------------------------------------------------------------
Ibiden Co., Ltd.
(Electronics-Component
Distributors) 75,000 1,184,002
- ---------------------------------------------------------------
Minebea Company Ltd.
(Electronics-Component
Distributors) 193,000 2,157,565
- ---------------------------------------------------------------
Murata Manufacturing Co., Ltd.
(Electronics-Component
Distributors) 46,000 1,348,138
- ---------------------------------------------------------------
Nippon Telegraph & Telephone
Corp. (Telephone) 2,500 2,190,497
- ---------------------------------------------------------------
Nippon Television Network Corp.
(Broadcasting-Television, Radio
& Cable) 2,050 605,446
- ---------------------------------------------------------------
NTT Data Corp. (Computer Software
& Services) 470 2,030,667
- ---------------------------------------------------------------
Rohm Co. (Electronics-Component
Distributors) 14,000 1,579,877
- ---------------------------------------------------------------
SMC Corp. (Machinery-Diversified) 6,800 564,997
- ---------------------------------------------------------------
Sony Corp. (Electronics-Component
Distributors) 30,000 2,494,901
- ---------------------------------------------------------------
TDK Corp. (Electronic Equipment) 31,000 2,449,279
- ---------------------------------------------------------------
25,587,019
- ---------------------------------------------------------------
MEXICO-3.15%
Cifra S.A. de C.V.-Series C
(Retail-General Merchandise) 1,009,000 1,716,435
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
MEXICO-(CONTINUED)
Cifra S.A. de C.V.-Series V
(Retail-General Merchandise) 117,499 $ 205,140
- ---------------------------------------------------------------
Coca-Cola Femsa S.A.-ADR
(Beverages-Non-Alcoholic) 145,800 2,478,600
- ---------------------------------------------------------------
Fomento Economico Mexicano, S.A.
de C.V.-Class B
(Beverages-Alcoholic) 265,450 1,963,864
- ---------------------------------------------------------------
Grupo Industrial Maseca S.A. de
C.V.-Class B (Foods) 681,200 491,128
- ---------------------------------------------------------------
Grupo Televisa S.A.-GDR
(Entertainment)(a) 67,700 2,775,700
- ---------------------------------------------------------------
Kimberly-Clark de Mexico, S.A. de
C.V.-Class A (Paper & Forest
Products) 483,400 2,371,869
- ---------------------------------------------------------------
Panamerican Beverages, Inc.-Class
A (Beverages-Non-Alcoholic) 86,300 3,441,212
- ---------------------------------------------------------------
TV Azteca, S.A. de C.V.-ADR
(Broadcasting-Television, Radio
& Cable) 24,200 450,725
- ---------------------------------------------------------------
15,894,673
- ---------------------------------------------------------------
NETHERLANDS-2.99%
CMG PLC
(Computers-Software & Services) 61,700 2,761,091
- ---------------------------------------------------------------
Getronics N.V.
(Computers-Software & Services) 41,000 1,814,464
- ---------------------------------------------------------------
Koninklijke Ahold N.V.
(Retail-Food Chains) 30,600 954,309
- ---------------------------------------------------------------
Koninklijke Numico N.V. (Foods) 26,000 868,769
- ---------------------------------------------------------------
Philips Electronics N.V.
(Household Furniture &
Appliances) 29,000 2,555,319
- ---------------------------------------------------------------
Randstad Holdings N.V.
(Services-Commercial &
Consumer) 25,000 1,227,662
- ---------------------------------------------------------------
Vendex International N.V.
(Retail-General Merchandise) 38,000 2,437,899
- ---------------------------------------------------------------
Verenigde Nederlandse
Uitgeversbedrijven Verenigd
Bezit (Publishing) 75,500 2,444,285
- ---------------------------------------------------------------
15,063,798
- ---------------------------------------------------------------
NORWAY-0.24%
Petroleum Geo-Services A.S.A.
(Oil-International
Integrated)(a) 18,800 1,220,296
- ---------------------------------------------------------------
PHILIPPINES-0.18%
Philippine Long Distance
Telephone Co. (Telephone) 16,460 440,709
- ---------------------------------------------------------------
Philippine Long Distance
Telephone Co.-ADR (Telephone) 17,800 480,600
- ---------------------------------------------------------------
921,309
- ---------------------------------------------------------------
PORTUGAL-1.27%
Banco Comercial Portugues, S.A.
(Banks-Major Regional) 82,000 2,875,261
- ---------------------------------------------------------------
Electric de Portugal, S.A.-ADR
(Electric Companies)(a) 24,200 1,258,400
- ---------------------------------------------------------------
Portugal Telecom S.A. (Telephone) 42,000 2,257,340
- ---------------------------------------------------------------
6,391,001
- ---------------------------------------------------------------
</TABLE>
10
<PAGE> 13
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
SINGAPORE-0.11%
Overseas Union Bank Ltd.
(Banks-Major Regional) 150,000 $ 568,541
- ---------------------------------------------------------------
SPAIN-2.18%
Banco Bilbao Vizcaya, S.A.
(Banks-Major Regional) 73,500 3,783,585
- ---------------------------------------------------------------
Banco Popular Espanol S.A.
(Banks-Major Regional) 13,000 1,066,973
- ---------------------------------------------------------------
Endesa S.A. (Electric Companies) 104,200 2,531,451
- ---------------------------------------------------------------
Iberdrola S.A. (Electric
Companies) 60,000 965,200
- ---------------------------------------------------------------
Telefonica de Espana (Telephone) 62,000 2,589,101
- ---------------------------------------------------------------
Telefonica de Espana
(Telephone)-Rights, expiring
05/30/98(a) 62,000 48,851
- ---------------------------------------------------------------
10,985,161
- ---------------------------------------------------------------
SWEDEN-0.81%
Forenings Sparbanken A.B.-Class A
(Banks-Major Regional) 46,000 1,437,871
- ---------------------------------------------------------------
Hennes & Mauritz A.B.-Class B
(Retail-Specialty-Apparel) 24,400 1,270,111
- ---------------------------------------------------------------
Svenska Handelsbanken-Class A
(Banks-Major Regional) 30,000 1,360,113
- ---------------------------------------------------------------
4,068,095
- ---------------------------------------------------------------
SWITZERLAND-2.76%
Clariant A.G.
(Chemicals-Specialty) 1,650 1,775,671
- ---------------------------------------------------------------
Credit Suisse Group (Banks-Major
Regional) 14,500 3,188,513
- ---------------------------------------------------------------
Holderbank Financiere Glarus
A.G.-Class B
(Construction-Cement &
Aggregates) 2,400 2,539,615
- ---------------------------------------------------------------
Nestle S.A. (Foods) 680 1,318,585
- ---------------------------------------------------------------
Rieter Holdings Ltd.
(Machinery-Diversified) 2,200 1,320,850
- ---------------------------------------------------------------
Schweizerischer Bankverein
(Banks-Major Regional) 6,500 2,256,614
- ---------------------------------------------------------------
Zurich Versicherungs-Gesellschaft
(Insurance-Multi-Line) 2,500 1,522,623
- ---------------------------------------------------------------
13,922,471
- ---------------------------------------------------------------
TAIWAN-0.28%
Taiwan Semiconductor
Manufacturing Co.-ADR
(Electronics-Semiconductors)(a) 58,500 1,436,906
- ---------------------------------------------------------------
UNITED KINGDOM-9.80%
Airtours PLC (Services-Commercial
& Consumer) 215,700 1,889,471
- ---------------------------------------------------------------
Bodycote International PLC
(Chemicals-Specialty) 71,000 1,422,595
- ---------------------------------------------------------------
British Aerospace PLC
(Aerospace/Defense) 64,000 2,138,659
- ---------------------------------------------------------------
British Petroleum Co. PLC (Oil &
Gas-Refining & Marketing) 62,000 979,399
- ---------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
UNITED KINGDOM-(CONTINUED)
Cable & Wireless PLC
(Telecommunications-
Cellular/Wireless) 226,000 $ 2,589,197
- ---------------------------------------------------------------
Compass Group PLC
(Services-Commercial &
Consumer) 59,200 1,024,774
- ---------------------------------------------------------------
EMAP PLC (Publishing) 102,000 2,076,141
- ---------------------------------------------------------------
General Electric Co. PLC
(Manufacturing-Diversified) 316,500 2,620,263
- ---------------------------------------------------------------
GKN PLC
(Manufacturing-Diversified) 39,000 1,126,479
- ---------------------------------------------------------------
Granada Group PLC (Leisure
Time-Products) 61,400 1,057,723
- ---------------------------------------------------------------
Hays PLC (Services-Commercial &
Consumer) 178,000 3,020,217
- ---------------------------------------------------------------
Kingfisher PLC (Retail-Department
Stores) 165,000 2,996,953
- ---------------------------------------------------------------
Ladbroke Group PLC (Leisure
Time-Products) 382,000 2,100,367
- ---------------------------------------------------------------
Lloyds TSB Group PLC (Banks-Major
Regional) 96,000 1,437,815
- ---------------------------------------------------------------
Misys PLC (Services-Commercial &
Consumer) 45,000 2,163,797
- ---------------------------------------------------------------
Pearson PLC (Specialty Printing) 70,000 1,096,993
- ---------------------------------------------------------------
Provident Financial PLC (Consumer
Finance) 132,579 2,215,166
- ---------------------------------------------------------------
Railtrack Group PLC (Shipping) 100,789 1,841,623
- ---------------------------------------------------------------
Rentokil Initial PLC
(Services-Commercial &
Consumer) 240,000 1,546,394
- ---------------------------------------------------------------
Royal & Sun Alliance Insurance
Group PLC
(Insurance-Multi-Line) 230,000 2,569,629
- ---------------------------------------------------------------
Siebe PLC
(Electronics-Component/
Distributors) 75,000 1,675,845
- ---------------------------------------------------------------
Smiths Industries PLC
(Machinery-Diversified) 150,000 2,158,779
- ---------------------------------------------------------------
Unilever PLC (Foods) 224,000 2,386,457
- ---------------------------------------------------------------
Vodafone Group PLC
(Telecommunications-
Cellular/Wireless) 300,000 3,286,463
- ---------------------------------------------------------------
WPP Group PLC
(Services-Advertising/Marketing) 316,000 2,005,695
- ---------------------------------------------------------------
49,426,894
- ---------------------------------------------------------------
Total Foreign Stocks & Other Equity
Interests (Cost $209,690,371) 293,844,111
- ---------------------------------------------------------------
DOMESTIC CONVERTIBLE PREFERRED STOCK-0.14%
FINANCIAL (DIVERSIFIED)-0.14%
MGIC Investment Corp.-$3.12 Conv.
Pfd.
(Cost $464,814) 7,000 735,000
- ---------------------------------------------------------------
</TABLE>
11
<PAGE> 14
FINANCIAL (DIVERSIFIED)-(CONTINUED)
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT(b) VALUE
<S> <C> <C>
U.S. DOLLAR DENOMINATED FOREIGN BONDS-0.15%
HONG KONG-0.15%
New World Infrastructure Ltd.
(Services-Commercial &
Consumer), Conv. Bonds, 5.00%,
07/15/01(c) (Acquired from
04/10/97 - 04/11/97; Cost
$234,938) $ 200,000 $ 201,000
- --------------------------------------------------------------
Conv. Bonds, 5.00%, 07/15/01 580,000 582,900
- --------------------------------------------------------------
Total U.S. Dollar
Denominated Foreign Bonds
(Cost $876,955) 783,900
- --------------------------------------------------------------
NON-U.S. DOLLAR DENOMINATED FOREIGN BONDS &
NOTES-0.25%
FRANCE-0.25%
AXA-UAP (Insurance-Multi-Line),
Conv. Sr.
Deb., 4.50%, 01/01/99
(Cost $732,700) FRF 2,835,000 1,251,536
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
<S> <C> <C>
REPURCHASE AGREEMENTS-5.59%(d)
Dean Witter Reynolds, Inc.
5.55%, 05/01/98(e) $ 179,511 $ 179,511
- --------------------------------------------------------------
Lehman Brothers Inc. 5.30%,
05/01/98(f) 28,000,000 28,000,000
- --------------------------------------------------------------
Total Repurchase Agreements
(Cost $28,179,511) 28,179,511
- --------------------------------------------------------------
TOTAL INVESTMENTS-99.03% 499,352,429
- --------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-0.97% 4,903,416
- --------------------------------------------------------------
NET ASSETS-100.00% $504,255,845
==============================================================
</TABLE>
Abbreviations:
ADR - American Depositary Receipt
Conv. - Convertible
Deb. - Debentures
FRF - French Francs
GDR - Global Depositary Receipt
Pfd. - Preferred
Sr. - Senior
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Principal in U.S. Dollars unless otherwise indicated.
(c) Restricted security. May be resold to qualified institutional buyers in
accordance with the provisions of Rule 144A under the Securities Act of
1933, as amended. The valuation of these securities has been determined in
accordance with procedures established by the Board of Directors. The
aggregate market value of this security at 04/30/98 represented 0.04% of the
Fund's net assets.
(d) Collateral on repurchase agreements, including the Fund's pro-rata interest
in joint repurchase agreements, is taken into possession by the Fund upon
entering into the repurchase agreement. The collateral is marked to market
daily to ensure its market value as being 102% of the sales price of the
repurchase agreement. The investments in some repurchase agreements are
through participation in joint accounts, private accounts, and certain
non-registered investment companies managed by the investment advisor or its
affiliates.
(e) Joint repurchase agreement entered into 04/30/98 with a maturing value of
$300,046,250. Collateralized by $307,111,000 U.S. Government obligations, 0%
to 9.40% due 06/10/98 to 09/26/19 with an aggregate market value at 04/30/98
of $306,000,308.
(f) Joint repurchase agreement entered into 04/30/98 with a maturing value of
$450,066,250. Collateralized by $522,302,000 U.S. Government obligations, 0%
to 7.45% due 08/14/98 to 10/08/27 with an aggregate market value at 04/30/98
of $459,005,491.
See Notes to Financial Statements.
12
<PAGE> 15
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1998
(UNAUDITED)
<TABLE>
<S> <C>
ASSETS:
Investments, at market value (cost
$371,065,639) $499,352,429
- -------------------------------------------------------
Foreign currencies, at value (cost
$3,494,978) 3,510,328
- -------------------------------------------------------
Receivables for:
Investments sold 5,232,008
- -------------------------------------------------------
Capital stock sold 2,252,580
- -------------------------------------------------------
Dividends and interest 1,119,844
- -------------------------------------------------------
Investment for deferred compensation plan 13,186
- -------------------------------------------------------
Other assets 25,785
- -------------------------------------------------------
Total assets 511,506,160
- -------------------------------------------------------
LIABILITIES:
Payables for:
Investments purchased 4,599,003
- -------------------------------------------------------
Capital stock reacquired 1,727,767
- -------------------------------------------------------
Deferred compensation 13,186
- -------------------------------------------------------
Accrued advisory fees 347,387
- -------------------------------------------------------
Accrued administrative services fees 11,735
- -------------------------------------------------------
Accrued directors' fees 2,243
- -------------------------------------------------------
Accrued distribution fees 319,085
- -------------------------------------------------------
Accrued transfer agent fees 77,260
- -------------------------------------------------------
Accrued operating expenses 152,649
- -------------------------------------------------------
Total liabilities 7,250,315
- -------------------------------------------------------
Net assets applicable to shares
outstanding $504,255,845
=======================================================
NET ASSETS:
Class A $217,916,181
=======================================================
Class B $281,432,014
=======================================================
Class C $ 4,907,650
=======================================================
CAPITAL STOCK, $0.001 PAR VALUE PER
SHARE:
Class A:
Authorized 200,000,000
- -------------------------------------------------------
Outstanding 11,304,102
=======================================================
Class B:
Authorized 200,000,000
- -------------------------------------------------------
Outstanding 14,878,249
=======================================================
Class C:
Authorized 200,000,000
- -------------------------------------------------------
Outstanding 259,527
=======================================================
Class A:
Net asset value and redemption price
per share $ 19.28
=======================================================
Offering price per share:
(Net asset value $19.28 / 95.25%) $ 20.24
=======================================================
Class B:
Net asset value and offering price per
share $ 18.92
=======================================================
Class C:
Net asset value and offering price per
share $ 18.91
=======================================================
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 1998
(UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $168,783 foreign
withholding tax) $ 2,002,141
- --------------------------------------------------------
Interest 719,736
- --------------------------------------------------------
Total investment income 2,721,877
- --------------------------------------------------------
EXPENSES:
Advisory fees 1,844,970
- --------------------------------------------------------
Administrative services fees 40,519
- --------------------------------------------------------
Custodian fees 176,160
- --------------------------------------------------------
Directors' fees 5,250
- --------------------------------------------------------
Distribution fees -- Class A 472,471
- --------------------------------------------------------
Distribution fees -- Class B 1,213,414
- --------------------------------------------------------
Distribution fees -- Class C 12,198
- --------------------------------------------------------
Transfer agent fees -- Class A 201,137
- --------------------------------------------------------
Transfer agent fees -- Class B 296,709
- --------------------------------------------------------
Transfer agent fees -- Class C 3,566
- --------------------------------------------------------
Other 171,458
- --------------------------------------------------------
Total expenses 4,437,852
- --------------------------------------------------------
Less:
Expenses paid indirectly (3,145)
- --------------------------------------------------------
Net expenses 4,434,707
- --------------------------------------------------------
Net investment income (loss) (1,712,830)
- --------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENT SECURITIES, FOREIGN
CURRENCIES, FUTURES AND OPTION CONTRACTS:
Net realized gain (loss) from:
Investment securities 9,732,168
- --------------------------------------------------------
Foreign currencies (402,967)
- --------------------------------------------------------
Futures contracts 727,924
- --------------------------------------------------------
Option contracts (27,489)
- --------------------------------------------------------
10,029,636
- --------------------------------------------------------
Net unrealized appreciation (depreciation)
of:
Investment securities 68,191,263
- --------------------------------------------------------
Foreign currencies 61,692
- --------------------------------------------------------
Futures contracts (51,000)
- --------------------------------------------------------
68,201,955
- --------------------------------------------------------
Net gain from investment securities,
foreign currencies futures and option
contracts 78,231,591
- --------------------------------------------------------
Net increase in net assets resulting from
operations $76,518,761
========================================================
</TABLE>
See Notes to Financial Statements.
13
<PAGE> 16
STATEMENT OF CHANGES IN NET ASSETS
FOR THE SIX MONTHS ENDED APRIL 30, 1998 AND THE YEAR ENDED OCTOBER 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
APRIL 30, OCTOBER 31,
1998 1997
------------ -------------
<S> <C> <C>
OPERATIONS:
Net investment income (loss) $ (1,712,830) $ (2,013,735)
- -------------------------------------------------------------------------------------------
Net realized gain from investment securities, foreign
currencies, futures and option contracts 10,029,636 11,895,254
- -------------------------------------------------------------------------------------------
Net unrealized appreciation of investment securities,
foreign currencies, futures and option contracts 68,201,955 37,072,703
- -------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 76,518,761 46,954,222
- -------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains:
Class A (4,454,600) -
- -------------------------------------------------------------------------------------------
Class B (5,820,423) -
- -------------------------------------------------------------------------------------------
Class C (40,919) -
- -------------------------------------------------------------------------------------------
Share transactions-net:
Class A 9,625,327 41,376,928
- -------------------------------------------------------------------------------------------
Class B 20,787,870 77,933,131
- -------------------------------------------------------------------------------------------
Class C 3,399,087 1,157,289
- -------------------------------------------------------------------------------------------
Net increase in net assets 100,015,103 167,421,570
- -------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 404,240,742 236,819,172
- -------------------------------------------------------------------------------------------
End of period $504,255,845 $ 404,240,742
===========================================================================================
NET ASSETS CONSIST OF:
Capital (par value and additional paid-in) $368,732,093 $ 334,919,809
- -------------------------------------------------------------------------------------------
Undistributed net investment income (loss) (1,727,412) (14,582)
- -------------------------------------------------------------------------------------------
Undistributed net realized gain (loss) from investment
securities, foreign currencies, futures and option
contracts 8,955,126 9,241,432
- -------------------------------------------------------------------------------------------
Unrealized appreciation of investment securities, foreign
currencies, futures and option contracts 128,296,038 60,094,083
- -------------------------------------------------------------------------------------------
$504,255,845 $ 404,240,742
===========================================================================================
</TABLE>
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1998
(UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
AIM Global Growth Fund (the "Fund") is an investment portfolio of AIM
International Funds, Inc. (the "Company"). The Company is a Maryland corporation
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), as an open-end series management investment company consisting of six
separate portfolios: AIM Global Growth Fund, AIM Asian Growth Fund, AIM European
Development Fund, AIM Global Aggressive Growth Fund, AIM Global Income Fund and
AIM International Equity Fund. The Fund currently offers three different classes
of shares: Class A shares, Class B shares and Class C shares. Class A shares are
sold with a front-end sales charge. Class B shares and Class C shares are sold
with a contingent deferred sales charge. Matters affecting each portfolio or
class are voted on exclusively by the shareholders of such portfolio or class.
The assets, liabilities and operations of each portfolio are accounted for
separately. Information presented in these financial statements pertains only to
the Fund. The Fund's investment objective is to provide long-term growth of
capital.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The following is a summary of significant accounting policies
followed by the Fund in the preparation of its financial statements.
A. Security Valuations-A security listed or traded on an exchange (except
convertible bonds) is valued at the last sales price on the exchange where
the security is principally traded or, lacking any sales, at the mean
between the closing bid and asked prices on the day of valuation. If a mean
is not available, as is the case in some foreign markets, the closing bid
will be used absent a last sales price. Securities traded in the
over-the-counter market (but not including securities reported on the NASDAQ
National Market System) are valued at the mean
14
<PAGE> 17
between the closing bid and asked prices on valuation date. Securities
reported on the NASDAQ National Market System are valued at the last sales
price on the valuation date or, absent a last sales price, at the mean of
the closing bid and asked prices. Debt obligations (including convertible
bonds) are valued on the basis of prices provided by an independent pricing
service. Prices provided by an independent pricing service may be determined
without exclusive reliance on quoted prices, and may reflect appropriate
factors such as yield, type of issue, coupon rate and maturity date.
Securities for which market quotations are either not readily available or
are questionable are valued at fair value as determined in good faith by or
under the supervision of the Company's officers in a manner specifically
authorized by the Board of Directors. Investments with maturities of 60 days
or less are valued on the basis of amortized cost which approximates market
value. Generally, trading in foreign securities is substantially completed
each day at various times prior to the close of the New York Stock Exchange.
The values of such securities used in computing the net asset value of the
Fund's shares are determined as of such times. Foreign currency exchange
rates are also generally determined prior to the close of the New York Stock
Exchange. Occasionally, events affecting the values of such securities and
such exchange rates may occur between the times at which they are determined
and the close of the New York Stock Exchange which will not be reflected in
the computation of the Fund's net asset value. If events materially
affecting the value of such securities occur during such period, then these
securities will be valued at their fair value as determined in good faith by
or under the supervision of the Board of Directors.
B. Foreign Currency Translations-Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated into U.S.
dollar amounts at date of valuation. Purchases and sales of portfolio
securities and income items denominated in foreign currencies are translated
into U.S. dollar amounts on the respective dates of such transactions.
C. Foreign Currency Contracts-A foreign currency contract is an obligation to
purchase or sell a specific currency for an agreed-upon price at a future
date. The Fund may enter into a foreign currency contract to attempt to
minimize the risk to the Fund from adverse changes in the relationship
between currencies. The Fund may also enter into a foreign currency contract
for the purchase or sale of a security denominated in a foreign currency in
order to "lock in" the U.S. dollar price of that security. The Fund could be
exposed to risk if counterparties to the contracts are unable to meet the
terms of their contracts or if the value of the foreign currency changes
unfavorably.
D. Securities Transactions, Investment Income and Distribu- tions-Securities
transactions are accounted for on a trade date basis. Realized gains or
losses are computed on the basis of specific identification of the
securities sold. Interest income is recorded as earned from settlement date
and is recorded on an accrual basis. Dividend income and distributions to
shareholders are recorded on the ex-dividend date.
E. Federal Income Taxes-The Fund intends to comply with the requirements of the
Internal Revenue Code necessary to qualify as a regulated investment company
and, as such, will not be subject to federal income taxes on otherwise
taxable income (including net realized capital gains) which is distributed
to shareholders. Therefore, no provision for federal income taxes is
recorded in the financial statements.
F. Stock Index Futures Contracts-The Fund may purchase or sell stock index
futures contracts as a hedge against changes in market conditions. Initial
margin deposits required upon entering into futures contracts are satisfied
by the segregation of specific securities as collateral for the account of
the broker (the Fund's agent in acquiring the futures position). During the
period the futures contracts are open, changes in the value of the contracts
are recognized as unrealized gains or losses by "marking to market" on a
daily basis to reflect the market value of the contracts at the end of each
day's trading. Variation margin payments are made or received depending upon
whether unrealized gains or losses are incurred. When the contracts are
closed, the Fund recognizes a realized gain or loss equal to the difference
between the proceeds from, or cost of, the closing transaction and the
Fund's basis in the contract. Risks include the possibility of an illiquid
market and that a change in the value of contracts may not correlate with
changes in the value of the securities being hedged.
G. Covered Call Options-The Fund may write call options, but only on a covered
basis; that is, the Fund will own the underlying security. Options written
by the Fund normally will have expiration dates between three and nine
months from the date written. The exercise price of a call option may be
below, equal to, or above the current market value of the underlying
security at the time the option is written. When the Fund writes a covered
call option, an amount equal to the premium received by the Fund is recorded
as an asset and an equivalent liability. The amount of the liability is
subsequently "market-to-market" to reflect the current market value of the
option written. The current market value of a written option is the mean
between the last bid and asked prices on that day. If a written call option
expires on the stipulated expiration date, or if the Fund enters into a
closing purchase transaction, the Fund realizes a gain (or a loss if the
closing purchase transaction exceeds the premium received when the option
was written) without regard to any unrealized gain or loss on the underlying
security, and the liability related to such option is extinguished. If a
written option is exercised, the Fund realizes a gain or a loss from the
sale of the underlying security and the proceeds of the sale are increased
by the premium originally received.
A call option gives the purchaser of such option the right to buy, and
the writer (the Fund) the obligation to sell, the underlying security at the
stated exercise price during the option period. The purchaser of a call
option has the right to acquire the security which is the subject of the
call option at any time during the option period. During the option period,
in return for the premium paid by the purchaser of the option, the Fund has
given up the opportunity for capital appreciation above the exercise price
should the market price of the underlying security increase, but has
retained the risk of loss should the price of the underlying security
decline. During the
15
<PAGE> 18
option period, the Fund may be required at any time to deliver the underlying
security against payment of the exercise price. This obligation is terminated
upon the expiration of the option period or at such earlier time at which the
Fund effects a closing purchase transaction by purchasing (at a price which
may be higher than that received when the call option was written) a call
option identical to the one originally written.
H. Put options-The Fund may purchase put options. By purchasing a put option,
the Fund obtains the right (but not the obligation) to sell the option's
underlying instrument at a fixed strike price. In return for this right, a
Fund pays an option premium. The option's underlying instrument may be a
security, or a futures contract. Put options may be used by a Fund to hedge
securities it owns by locking in a minimum price at which the Fund can sell.
If security prices fall, the put option could be exercised to offset all or a
portion of the Fund's resulting losses. At the same time, because the maximum
the Fund has at risk is the cost of the option, purchasing put options does
not eliminate the potential for the Fund to profit from an increase in the
value of the securities hedged.
I. Expenses-Distribution and transfer agency expenses directly attributable to a
class of shares are charged to that class' operations. All other expenses
which are attributable to more than one class are allocated among the
classes.
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Company has entered into a master investment advisory agreement with A I M
Advisors, Inc. ("AIM"). Under the terms of the master investment advisory
agreement, the Fund pays an advisory fee to AIM at the annual rate of 0.85% of
the first $1 billion of the Fund's average daily net assets, plus 0.80% of the
Fund's average daily net assets in excess of $1 billion.
The Fund, pursuant to a master administrative services agreement with AIM, has
agreed to reimburse AIM for administrative costs incurred in providing
accounting services to the Fund. During the six months ended April 30, 1998, AIM
was reimbursed $40,519 for such services.
The Fund, pursuant to a transfer agency and service agreement, has agreed to
pay A I M Fund Services, Inc. ("AFS") a fee for providing transfer agency
services to the Fund. During the six months ended April 30, 1998, AFS was paid
$301,921 for such services.
The Company has entered into master distribution agreements with A I M
Distributors, Inc. ("AIM Distributors") to serve as the distributor for the
Class A, Class B and Class C shares of the Fund. The Company has adopted
distribution plans pursuant to Rule 12b-1 under the 1940 Act with respect to the
Fund's Class A shares and Class C shares (the "Class A and C Plan"), and the
Fund's Class B shares (the "Class B Plan") (collectively, the "Plans"). The
Fund, pursuant to the Class A and C Plan, pays AIM Distributors compensation at
an annual rate of 0.50% of the average daily net assets of the Class A shares
and 1.00% of the average daily net assets of Class C shares. The Fund, pursuant
to the Class B Plan, pays AIM Distributors compensation at an annual rate of
1.00% of the average daily net assets attributable to the Class B shares. Of
these amounts, the Fund may pay a service fee of 0.25% of the average daily net
assets of the Class A, Class B or C shares to selected dealers and financial
institutions who furnish continuing personal shareholder services to their
customers who purchase and own the appropriate class of shares of the Fund. Any
amounts not paid as a service fee under the Plans would constitute an
asset-based sales charge. The Plans also impose a cap on the total sales
charges, including asset-based sales charges that may be paid by the respective
classes. AIM Distributors may, from time to time, assign, transfer, or pledge to
one or more designees, its rights to all or a designated portion of (a)
compensation received by AIM Distributors from the Fund pursuant to the Class B
Plan (but not AIM Distributors' duties and obligations pursuant to the Class B
Plan) and (b) any contingent deferred sales charges received by AIM Distributors
related to the Class B shares. During the six months ended April 30, 1998, the
Class A, Class B and Class C shares, paid AIM Distributors $472,471, $1,213,414
and $12,198, respectively as compensation under the Plans.
AIM Distributors received commissions of $97,142 from the sales of the Class A
shares of the Fund during the six months ended April 30, 1998. Such commissions
are not an expense of the Fund. They are deducted from, and are not included in,
the proceeds from sales of Class A shares. During the six months ended April 30,
1998. AIM Distributors received commissions of $16,610 in contingent deferred
sales charges imposed on redemptions of Fund shares. Certain officers and
directors of the Company are officers and directors of AIM, AFS and AIM
Distributors.
During the six months ended April 30, 1998, the Fund incurred legal fees of
$3,172 for services rendered by the law firm of Kramer, Levin, Naftalis &
Frankel as counsel to the Company's directors. A member of that firm is a
director of the Company.
NOTE 3-INDIRECT EXPENSES
During the six months ended April 30, 1998, the Fund received reductions in
transfer agency fees from AFS (an affiliate of AIM) and reductions in custodian
fees of $2,468 and $677, respectively, under expense offset arrangements. The
effect of the above arrangements resulted in a reduction of the Fund's total
expenses of $3,145 during the six months ended April 30, 1998.
NOTE 4-DIRECTORS' FEES
Directors' fees represent remuneration paid or accrued to each director who is
not an "interested person" of AIM. The Company may invest directors' fees, if so
elected by a director, in mutual fund shares in accordance with a deferred
compensation plan.
NOTE 5-BANK BORROWINGS
The Fund is a participant in a committed line of credit facility with a
syndicate administered by The Chase Manhattan Bank. The Fund may borrow up to
the lesser of (i) $500,000,000 or (ii) the limits set by its prospectus for
borrowings. The Fund and other funds advised by AIM which are parties to the
line of credit may borrow on a first come, first served basis. Interest on
borrowings under the line of credit is payable on maturity or prepayment date.
During the six months ended April 30, 1998, the Fund did not borrow under the
line of credit agreement. The funds which are
16
<PAGE> 19
party to the line of credit are charged a commitment fee of 0.05% on the unused
balance of the committed line. The commitment fee is allocated among the funds
based on their respective average net assets for the period.
Pursuant to an amendment to the line of credit agreement effective May 1,
1998, the Fund may borrow up to the lessor of (i) $1,000,000,000 or (ii) the
limits set by the prospectus for borrowings.
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Fund during the six months ended April 30, 1998 was
$169,234,961 and $151,078,972, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
on a tax basis, as of April 30, 1998 is as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $136,377,976
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (8,394,011)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $127,983,965
=========================================================
</TABLE>
Cost of investments for tax purposes is $371,368,464.
NOTE 7-OPTION CONTRACTS WRITTEN
Transactions in call options written during the six months ended April 30, 1998
are summarized as follows:
<TABLE>
<CAPTION>
CALL OPTION CONTRACTS
---------------------
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
--------- --------
<S> <C> <C>
Beginning of period - -
- --------------------------------------------------------
Written 51 $ 27,335
- --------------------------------------------------------
Exercised (51) (27,335)
- --------------------------------------------------------
End of period 0 $ 0
========================================================
</TABLE>
NOTE 8-PUT OPTIONS PURCHASED
Transactions in put options purchased during the six months ended April 30, 1998
are summarized as follows:
<TABLE>
<CAPTION>
PUT OPTION CONTRACTS
------------------------
NUMBER OF PREMIUMS
CONTRACTS PAID
--------- -----------
<S> <C> <C>
Beginning of period - -
- --------------------------------------------------------
Purchased 51 $ 27,489
- --------------------------------------------------------
Expired (51) (27,489)
- --------------------------------------------------------
End of period 0 $ 0
========================================================
</TABLE>
NOTE 9-CAPITAL STOCK
Changes in the Fund's capital stock outstanding during the six months ended
April 30, 1998 and the year ended October 31, 1997 were as follows:
<TABLE>
<CAPTION>
APRIL 30, OCTOBER 31,
-------------------------- -------------------------
1998 1997
-------------------------- -------------------------
SHARES AMOUNT SHARES AMOUNT
---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
Sold:
Class A 6,817,691 $ 120,490,697 6,399,974 $103,567,757
- -----------------------------------------------------------------------------
Class B 1,936,054 33,801,397 6,303,261 98,414,198
- -----------------------------------------------------------------------------
Class C* 228,828 4,057,497 67,094 1,157,289
- -----------------------------------------------------------------------------
Issued as reinvestment of
distributions:
Class A 259,539 4,204,528 - -
- -----------------------------------------------------------------------------
Class B 340,750 5,428,145 - -
- -----------------------------------------------------------------------------
Class C* 2,447 38,984 - -
- -----------------------------------------------------------------------------
Reacquired:
Class A (6,520,692) (115,069,898) (3,750,438) (62,190,829)
- -----------------------------------------------------------------------------
Class B (1,083,167) (18,441,672) (1,291,769) (20,481,067)
- -----------------------------------------------------------------------------
Class C* (38,842) (697,394) - -
- -----------------------------------------------------------------------------
1,942,608 $ 33,812,284 7,728,122 $120,467,348
=============================================================================
</TABLE>
* Class C shares commenced sales on August 4, 1997.
17
<PAGE> 20
NOTE 10-FINANCIAL HIGHLIGHTS
Shown below are the financial highlights for a share of Class A and Class B
capital stock outstanding during the six months ended April 30, 1998, each of
the years in the three-year period ended October 31, 1997 and the period
September 15, 1994 (date operations commenced) through October 31, 1994 and for
a share of Class C capital stock outstanding during the six months ended April
30, 1998 and the period August 4, 1997 (date sales commenced) through October
31, 1997.
<TABLE>
<CAPTION>
CLASS A
-------------------------------------------------------------
OCTOBER 31,
APRIL 30, ---------------------------------------------
1998 1997 1996 1995 1994
--------- -------- --------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 16.65 $ 14.20 $ 12.32 $ 10.23 $ 10.00
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Income from investment operations:
Net investment income (loss) (0.04) (0.04) (0.01) (0.02) -
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Net gains on securities (both realized and unrealized) 3.09 2.49 2.11 2.11 0.23
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Total from investment operations 3.05 2.45 2.10 2.09 0.23
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Less distributions:
Dividends from net investment income - - - (0.004) -
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Distributions from net realized gains (0.42) - (0.22) - -
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Total distributions (0.42) - (0.22) (0.004) -
- ------------------------------------------------------------ -------- -------- --------- -------- --------
Net asset value, end of period $ 19.28 $ 16.65 $ 14.20 $ 12.32 $ 10.23
============================================================ ======== ======== ========= ======== ========
Total return(a) 18.81% 17.25% 17.26% 20.48% 2.30%
============================================================ ======== ======== ========= ======== ========
Ratios/supplemental data:
Net assets, end of period (000s omitted) $217,916 $178,917 $ 114,971 $ 23,754 $ 3,093
============================================================ ======== ======== ========= ======== ========
Ratio of expenses to average net assets(b) 1.74%(c)(d) 1.76% 1.93% 2.12% 1.95%(e)
============================================================ ======== ======== ========= ======== ========
Ratio of net investment income (loss) to average net
assets(f) (0.49)%(c) (0.30)% (0.13)% (0.28)% 0.10%(e)
============================================================ ======== ======== ========= ======== ========
Portfolio turnover rate 36% 96% 82% 79% 6%
============================================================ ======== ======== ========= ======== ========
Average brokerage commission rate paid(g) $ 0.0277 $ 0.0239 $ 0.0234 N/A N/A
============================================================ ======== ======== ========= ======== ========
</TABLE>
(a) Does not deduct sales charges and are not annualized for periods less than
one year.
(b) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
1.94%, 2.98% and 5.67% (annualized) for 1996-1994.
(c) Ratios are annualized and based on average net assets of $190,554,477.
(d) Ratio includes expenses paid indirectly. Excluding expenses paid indirectly,
the ratio of expenses to average net assets would have been the same
(annualized).
(e) Annualized.
(f) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (0.14)%, (1.14)% and (3.63)% (annualized) for
1996-1994.
(g) The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the
total number of related shares purchased and sold, which is required to be
disclosed for fiscal years beginning September 1, 1995 and thereafter.
18
<PAGE> 21
NOTE 10-FINANCIAL HIGHLIGHTS-continued
<TABLE>
<CAPTION>
CLASS B
-----------------------------------------------------------------------------------------
OCTOBER 31,
APRIL 30, ---------------------------------------------------------------------
1998 1997 1996 1995 1994
--------------- ---------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $ 16.39 $ 14.05 $ 12.26 $ 10.22 $10.00
- ----------------------------------- -------- -------- -------- ------- ------
Income from investment operations:
Net investment income (loss) (0.09)(a) (0.11) (0.05) (0.04) -
- ----------------------------------- -------- -------- -------- ------- ------
Net gains (losses) on securities
(both realized and unrealized) 3.04 2.45 2.06 2.08 0.22
- ----------------------------------- -------- -------- -------- ------- ------
Total from investment
operations 2.95 2.34 2.01 2.04 0.22
- ----------------------------------- -------- -------- -------- ------- ------
Less distributions:
Distributions from net realized
gains (0.42) - (0.22) - -
- ----------------------------------- -------- -------- -------- ------- ------
Total distributions (0.42) - (0.22) - -
- ----------------------------------- -------- -------- -------- ------- ------
Net asset value, end of period $ 18.92 $ 16.39 $ 14.05 $ 12.26 $10.22
=================================== ======== ======== ======== ======= ======
Total return(b) 18.49% 16.65% 16.60% 19.96% 2.20%
=================================== ======== ======== ======== ======= ======
Ratios/supplemental data:
Net assets, end of period (000s
omitted) $281,432 $224,225 $121,848 $17,157 $1,277
=================================== ======== ======== ======== ======= ======
Ratio of expenses to average net
assets 2.28%(c)(d) 2.29% 2.48%(e) 2.64%(e) 2.51%(e)(f)
=================================== ======== ======== ======== ======= ======
Ratio of net investment income
(loss) to average net assets (1.02)%(c) (0.83)% (0.69)%(g) (0.79)%(g) (0.47)%(f)(g)
=================================== ======== ======== ======== ======= ======
Portfolio turnover rate 36% 96% 82% 79% 6%
=================================== ======== ======== ======== ======= ======
Average brokerage commission rate
paid(h) $ 0.0277 $ 0.0239 $ 0.0234 N/A N/A
=================================== ======== ======== ======== ======= ======
<CAPTION>
CLASS C
-------------------------------
APRIL 30, OCTOBER 31,
1998 1997
--------------- -----------
<S> <C> <C>
Net asset value, beginning of
period $ 16.39 $ 17.39
- ----------------------------------- ------- -------
Income from investment operations:
Net investment income (loss) (0.09)(a) (0.03)
- ----------------------------------- ------- -------
Net gains (losses) on securities
(both realized and unrealized) 3.03 (0.97)
- ----------------------------------- ------- -------
Total from investment
operations 2.94 (1.00)
- ----------------------------------- ------- -------
Less distributions:
Distributions from net realized
gains (0.42) -
- ----------------------------------- ------- -------
Total distributions (0.42) -
- ----------------------------------- ------- -------
Net asset value, end of period $ 18.91 $ 16.39
=================================== ======= =======
Total return(b) 18.43% (5.75)%
=================================== ======= =======
Ratios/supplemental data:
Net assets, end of period (000s
omitted) $ 4,908 $ 1,100
=================================== ======= =======
Ratio of expenses to average net
assets 2.28%(c)(d) 2.29%(f)
=================================== ======= =======
Ratio of net investment income
(loss) to average net assets (1.02)%(c) (0.83)%(f)
=================================== ======= =======
Portfolio turnover rate 36% 96%
=================================== ======= =======
Average brokerage commission rate
paid(h) $0.0277 $0.0239
=================================== ======= =======
</TABLE>
(a) Calculated using average shares outstanding.
(b) Does not deduct contingent deferred sales charges and are not annualized for
periods less than one year.
(c) Ratios are annualized and based on average net assets of $244,693,916 and
$2,459,925 for Class B and Class C, respectively.
(d) Ratios include indirectly paid expenses. Excluding indirectly paid expenses,
the ratios of expenses to average net assets would have been 2.27%
(annualized) and 2.27% (annualized) for Class B and Class C, respectively.
(e) After fee waivers and/or expense reimbursements. Ratios of expenses to
average net assets prior to fee waivers and/or expense reimbursements were
2.49%, 3.38% and 6.20% (annualized) for 1996-1994.
(f) Annualized.
(g) After fee waivers and/or expense reimbursements. Ratios of net investment
income (loss) to average net assets prior to fee waivers and/or expense
reimbursements were (0.69)%, (1.54)% and (4.16)% (annualized) for 1996-1994.
(h) The average commission rate paid is the total brokerage commissions paid on
applicable purchases and sales of securities for the period divided by the
total number of related shares purchased and sold, which is required to be
disclosed for fiscal years beginning September 1, 1995 and thereafter.
19
<PAGE> 22
---------------
Current shareholders
can call our
AIM Investor Line at
800-246-5463
for 24-hour-a-day
account information.
---------------
HOW AIM MAKES INVESTING
EASY FOR YOU
o LOW INITIAL INVESTMENT. You can get your investment program started for as
little as $500. Subsequent investments can be made for only $50.
o AUTOMATIC REINVESTMENT OF DIVIDENDS AND/OR CAPITAL GAINS. Distributions may
be received in cash or reinvested in the Fund free of charge. Over time, the
power of compounding can significantly increase the value of your assets.
o AUTOMATIC INVESTMENT PLAN. You may build your investment by regularly
purchasing additional shares. Pre-authorized checks for $50 or more can be
drafted monthly from your personal checking account.
o EASY ACCESS TO YOUR MONEY. Your shares may be redeemed at net asset value
any day the New York Stock Exchange is open. The price of shares sold may be
more or less than their original cost, depending on market conditions.
o SYSTEMATIC WITHDRAWAL PLAN. You may elect to receive checks of at least $50
monthly or quarterly through a systematic withdrawal plan.
o EXCHANGE PRIVILEGE. As your goals change, you may exchange all or part of
your assets for those of other funds within the same share class of The AIM
Family of Funds--Registered Trademark--. The exchange privilege may be
modified or discontinued for any of the AIM funds. Certain restrictions
apply.
o RETIREMENT PLANS. You may purchase shares of the fund for your Individual
Retirement Account (IRA) or any other type of retirement plan, and earn
tax-deferred dollars for your retirement.
o TOLL-FREE ACCESS. Current shareholders can call our AIM Investor Line at
800-246-5463 for 24-hour-a-day account information. Or, of course, you may
contact your financial consultant for assistance.
o www.aimfunds.com. As a current shareholder, you can check account balances
24 hours a day over the Internet. State-of-the-art encryption lets you send
us questions that include confidential information without the fear of
eavesdropping, tampering, or forgery.
<PAGE> 23
Directors & Officers
<TABLE>
<CAPTION>
BOARD OF DIRECTORS OFFICERS OFFICE OF THE FUND
<S> <C> <C>
Charles T. Bauer Charles T. Bauer 11 Greenway Plaza
Chairman Chairman Suite 100
A I M Management Group Inc. Houston, TX 77046
Robert H. Graham
Bruce L. Crockett President INVESTMENT ADVISOR
Director
ACE Limited; John J. Arthur A I M Advisors, Inc.
Formerly Director, President, and Senior Vice President and Treasurer 11 Greenway Plaza
Chief Executive Officer Suite 100
COMSAT Corporation Carol F. Relihan Houston, TX 77046
Senior Vice President and Secretary
Owen Daly II TRANSFER AGENT
Director Gary T. Crum
Cortland Trust Inc. Senior Vice President A I M Fund Services, Inc.
P.O. Box 4739
Edward K. Dunn Jr. Dana R. Sutton Houston, TX 77210-4739
Chairman, Mercantile Mortgage Corp.; Vice President and Assistant Treasurer
Formerly Vice Chairman and President, CUSTODIAN
Mercantile-Safe Deposit & Trust Co.; and Robert G. Alley
President, Mercantile Bankshares Vice President State Street Bank and Trust Company
225 Franklin Street
Jack Fields Melville B. Cox Boston, MA 02110
Chief Executive Officer Vice President
Texana Global, Inc.; COUNSEL TO THE FUND
Formerly Member Jonathan C. Schoolar
of the U.S. House of Representatives Vice President Ballard Spahr
Andrews & Ingersoll, LLP
Carl Frischling Renee A. Bamford 1735 Market Street
Partner Assistant Secretary Philadelphia, PA 19103
Kramer, Levin, Naftalis & Frankel
P. Michelle Grace COUNSEL TO THE DIRECTORS
Robert H. Graham Assistant Secretary
President and Chief Executive Officer Kramer, Levin, Naftalis & Frankel
A I M Management Group Inc. Jeffrey H. Kupor 919 Third Avenue
Assistant Secretary New York, NY 10022
John F. Kroeger
Formerly Consultant Nancy L. Martin DISTRIBUTOR
Wendell & Stockel Associates, Inc. Assistant Secretary
A I M Distributors, Inc.
Lewis F. Pennock Ofelia M. Mayo 11 Greenway Plaza
Attorney Assistant Secretary Suite 100
Houston, TX 77046
Ian W. Robinson Lisa A. Moss
Consultant; Formerly Executive Assistant Secretary
Vice President and
Chief Financial Officer Kathleen J. Pflueger
Bell Atlantic Management Assistant Secretary
Services, Inc.
Samuel D. Sirko
Louis S. Sklar Assistant Secretary
Executive Vice President
Hines Interests Stephen I. Winer
Limited Partnership Assistant Secretary
Mary J. Benson
Assistant Treasurer
</TABLE>
20
<PAGE> 24
<TABLE>
<S> <C>
THE AIM FAMILY OF FUNDS--Registered Trademark--
FOR AGGRESSIVE GROWTH
AIM Aggressive Growth Fund*
AIM Asian Growth Fund
AIM Capital Development Fund
AIM Constellation Fund
AIM European Development Fund
AIM Global Aggressive Growth Fund
[PHOTO OF FOR GROWTH OF CAPITAL
11 GREENWAY PLAZA
APPEARS HERE] AIM Advisor International Value Fund
AIM Blue Chip Fund
AIM Global Growth Fund
AIM International Equity Fund
AIM Select Growth Fund**
AIM Value Fund
AIM Weingarten Fund
FOR GROWTH AND INCOME OR INCOME WITH CAPITAL GROWTH
AIM Advisor Flex Fund
AIM Advisor Large Cap Value Fund
AIM Advisor MultiFlex Fund
AIM Advisor Real Estate Fund
AIM Balanced Fund
AIM Charter Fund
AIM Global Utilities Fund
FOR HIGH CURRENT INCOME OR CURRENT INCOME
AIM High Yield Fund
AIM Global Income Fund
AIM Income Fund
FOR CURRENT TAX-FREE INCOME
AIM High Income Municipal Fund
AIM Municipal Bond Fund
AIM Tax-Exempt Bond Fund of Connecticut
AIM Tax-Free Intermediate Fund
FOR CURRENT INCOME AND HIGH DEGREE OF SAFETY
AIM Intermediate Government Fund
AIM Limited Maturity Treasury Fund
AIM Money Market Fund
AIM Tax-Exempt Cash Fund
A I M Management Group Inc. has provided * AIM Aggressive Growth Fund was closed to new
leadership in the mutual fund industry since 1976 investors on June 5, 1997. ** On May 1, 1998, AIM
and managed approximately $89 billion in assets Growth Fund was renamed AIM Select Growth Fund.
for more than 4.4 million shareholders, including For more complete information about any AIM
individual investors, corporate clients, and Fund(s), including sales charges and expenses, ask
Financial institutions, as of March 31, 1998. The your Financial consultant or securities dealer for
AIM Family of Funds--Registered Trademark-- is a free prospectus(es). Please read the
distributed nationwide, and AIM today ranks among prospectus(es) carefully before you invest or send
the nation's top 15 mutual fund companies in money.
assets under management, according to Lipper
Analytical Services, Inc.
INVEST WITH DISCIPLINE-SM-
</TABLE>
