As filed with the Securities and Exchange Commission on April 28, 2000.
File No. 811-07363
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT
UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 6 |X|
GROWTH PORTFOLIO
(Exact Name of Registrant as Specified in Charter)
11 Greenway Plaza, Suite 100,
Houston, Texas 77046
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code: 713-626-1919
Samuel D. Sirko, Esq.
A I M Advisors, Inc.
11 Greenway Plaza, Suite 100,
Houston, Texas 77046
(Name and Address of Agent for Service)
-----------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE
This Amendment to the Registration Statement of Growth Portfolio has
been filed by the Registrant pursuant to Section 8(b) of the Investment Company
Act of 1940, as amended (the "1940 Act"). However, beneficial interests in the
Registrant have not been registered under the Securities Act of 1933, as amended
(the "1933 Act"), since such interests are offered solely in private placement
transactions that do not involve any "public offering" within the meaning of
Section 4(2) of the 1933 Act. Investments in the Registrant may only be made by
investment companies, insurance company separate accounts, common or commingled
trust funds or similar organizations or entities which are "accredited
investors" as defined in Regulation D under the 1933 Act. This Amendment to the
Registration Statement does not constitute an offer to sell, or the solicitation
of an offer to buy, any beneficial interests in the Registrant.
<PAGE>
GROWTH PORTFOLIO
CONTENTS OF REGISTRATION STATEMENT
This registration statement of Growth Portfolio contains the following
documents:
Facing Sheet
Contents of Registration Statement
Part A
Part B
Part C
Signature Page
Exhibits
<PAGE>
PART A
Responses to Items 1, 2, 3, 5, and 9 have been omitted pursuant to
paragraph B.2(b) of the General Instructions to Form N-1A.
Responses to certain Items required to be included in Part A of this
Registration Statement of Growth Portfolio (the "Master Portfolio") are
incorporated herein by reference from Post-Effective Amendment No. 48 to the
Registration Statement of AIM Growth Series ("Growth Series") (1940 Act File No.
811-2699), as filed with the Securities and Exchange Commission ("SEC") on April
28, 2000 ("Feeder Registration Statement"). Part A of the Feeder Registration
Statement includes the prospectuses of AIM Small Cap Growth Fund and AIM Basic
Value Fund ("Feeder's Part A").
ITEM 4. INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES, AND RELATED
RISKS.
- --------------------------------------------------------------------------------
Information on the Portfolios' investment objectives, principal
investment strategies and the principal risk factors associated with investments
in the Portfolios is incorporated herein by reference from the sections entitled
"Investment Objective and Strategies" and "Principal Risks of Investing in the
Fund" in the Feeder's Part A. Additional investment techniques, features, and
limitations concerning the Portfolios' investment program are described in Part
B of this Registration Statement.
ITEM 6. MANAGEMENT, ORGANIZATION, AND CAPITAL STRUCTURE.
- ---------------------------------------------------------
Each Portfolio is managed and administered by A I M Advisors, Inc.
("AIM"). AIM and its worldwide asset management affiliates provide investment
management and/or administrative services to institutional, corporate, and
individual clients around the world. AIM is an indirect, wholly owned subsidiary
of AMVESCAP PLC ("AMVESCAP"). AMVESCAP and its subsidiaries are an independent
investment management group that has a significant presence in the institutional
and retail segment of the investment management industry in North America and
Europe, and a growing presence in Asia.
A more complete description of how the business of the Portfolios is
managed is incorporated herein by reference from the section entitled "Fund
Management" in the Feeder's Part A.
Beneficial interests in the Master Portfolio are divided currently into
two separate subtrusts or "series" -- Small Cap Portfolio and Value Portfolio
(individually, a "Portfolio" and collectively, the "Portfolios") -- each having
a distinct investment objective and distinct investment policies and
limitations. Both Portfolios commenced operations on October 18, 1995. The
assets of each Portfolio belong only to that Portfolio, and the liabilities of
each Portfolio are borne solely by that Portfolio and no other.
Beneficial interests in the Portfolios are offered solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act. Investments in the Portfolios may only
A-1
<PAGE>
be made by investment companies, insurance company separate accounts, common or
commingled trust funds or similar organizations or entities that are "accredited
investors" as defined in Regulation D under the 1933 Act. The Registration
Statement does not constitute an offer to sell, or the solicitation of an offer
to buy, any "security" within the meaning of the 1933 Act.
Investor inquiries may be directed to AIM at the following address: 11
Greenway Plaza, Suite 100, Houston, Texas 77046.
ITEM 7. SHAREHOLDER INFORMATION.
- --------------------------------
An investment in a Portfolio may be made without a sales load at the
net asset value next determined after an order is received in "good order" by a
Portfolio. There is no minimum initial or subsequent investment in a Portfolio.
However, investments must be made in federal funds (i.e., monies credited to the
account of a Portfolio's custodian bank by a Federal Reserve Bank). Each
investor in a Portfolio may add to or reduce its investment in the Portfolio on
each day the New York Stock Exchange ("NYSE") is open for trading.
Information on the time and method of valuation of the Portfolios'
assets is incorporated by reference from the section entitled "Shareholder
Information - Pricing of Shares" in the Feeder's Part A.
Each Portfolio reserves the right to cease accepting investments at any
time or to reject any investment order.
An investor in a Portfolio may redeem any portion or all of its
investment at any time at the net asset value next determined after a request in
"good order" is furnished by the investor to that Portfolio. The proceeds of a
redemption will be paid by a Portfolio in federal funds normally on the next
business day after the redemption is effected, but in any event within seven
days. Investments in a Portfolio may not be transferred.
The right of any investor to receive payment with respect to any
redemption may be suspended or the payment of the proceeds therefrom postponed
during any period (1) when the NYSE is closed (other than customary weekend or
holiday closings) or trading on the NYSE is restricted as determined by the SEC,
(2) when an emergency exists, as defined by the SEC, which would prohibit a
Portfolio in disposing of its portfolio securities or in fairly determining the
value of its assets, or (3) as the SEC may otherwise permit.
Each Portfolio annually declares as a dividend all of its net
investment income, if any, which includes dividends, accrued interest and earned
discount (including both original issue and market discounts) less applicable
expenses. Each Portfolio also annually distributes substantially all of its
realized net short-term capital gain (the excess of short-term capital gains
over short-term capital losses), net capital gain (the excess of net long-term
capital gain over net short-term capital loss), and net gains from foreign
currency transactions, if any. Each Portfolio may make an additional dividend or
other distribution if necessary to avoid a 4% excise tax on certain
undistributed income and gain.
A-2
<PAGE>
Under the current method of the Portfolios' operation, they are not
subject to any income tax. However, each investor in a Portfolio is taxable on
its share (as determined in accordance with the governing instruments of the
Master Portfolio and the Internal Revenue Code of 1986, as amended ("Code") and
the regulations promulgated thereunder) of that Portfolio's income, gains,
losses, deductions, and credits in determining its income tax liability. The
determination of such share will be made in accordance with the Code and the
regulations promulgated thereunder. It is intended that each Portfolio's assets
and income will be managed in such a way that an investor in a Portfolio will be
able to satisfy the requirements to be a regulated investment company under
Subchapter M of the Code, assuming that the investor invested all of its assets
in the Portfolio. See Part B for a discussion of the foregoing tax matters and
certain other matters.
ITEM 8. DISTRIBUTION ARRANGEMENTS.
- -----------------------------------
Not Applicable.
A-3
<PAGE>
PART B
Part B of this Registration Statement should be read only in
conjunction with Part A. Capitalized terms used in Part B and not otherwise
defined have the meanings given them in Part A of this Registration Statement.
Responses to certain Items required to be included in Part B of this
Registration Statement are incorporated herein by reference from the Feeder
Registration Statement. Part B of the Feeder Registration Statement includes the
joint statement of additional information of AIM Small Cap Growth Fund ("Small
Cap Fund") and AIM Basic Value Fund ("Value Fund") (collectively, "Feeder's Part
B").
ITEM 10. COVER PAGE AND TABLE OF CONTENTS.
- -------------------------------------------
Cover Page: Not applicable.
Page
History of Growth Portfolio..............................................B-1
Description of the Master Portfolio and its Investments and Risks........B-2
Management of the Master Portfolio.......................................B-2
Control Persons and Principal Holders of Interests.......................B-3
Investment Advisory and Other Services...................................B-3
Brokerage Allocation and Other Practices.................................B-4
Capital Stock and Other Securities.......................................B-4
Purchase, Redemption and Pricing of Securities...........................B-6
Taxation of the Portfolios...............................................B-7
Underwriters.............................................................B-7
Calculation of Performance Data..........................................B-7
Financial Statements.....................................................B-7
ITEM 11. HISTORY OF GROWTH PORTFOLIO.
- --------------------------------------
Growth Portfolio (the "Master Portfolio") was organized as a Delaware
business trust on May 7, 1998. On May 29, 1998, the Master Portfolio acquired
the assets and assumed the liabilities of Growth Portfolio, a New York common
law trust.
B-1
<PAGE>
ITEM 12. DESCRIPTION OF THE MASTER PORTFOLIO AND ITS INVESTMENTS AND RISKS.
- ---------------------------------------------------------------------------
The Master Portfolio is a diversified, open-end management investment
company.
Part A contains basic information about the investment objectives,
principal investment strategies and principal risks of Small Cap Portfolio and
Value Portfolio, each a subtrust or "series" of the Master Portfolio. This Part
B supplements the discussion in Part A of the investment objectives, principal
investment strategies, and principal risks of the Portfolios.
Information on the fundamental investment limitations and the
non-fundamental investment policies and limitations of the Portfolios, the types
of securities bought and investment techniques used by the Portfolios, and
certain risks attendant thereto, as well as other information on the Portfolios'
investment programs, is incorporated by reference from the sections entitled
"Investment Policies," "Options and Futures," "Risk Factors," "Investment
Limitations," "Execution of Portfolio Transactions," and "Appendix" in the
Feeder's Part B.
ITEM 13. MANAGEMENT OF THE MASTER PORTFOLIO.
- ---------------------------------------------
Information about the Trustees and officers of the Master Portfolio,
and their roles in the management of the Portfolios and other AIM Funds, is
incorporated herein by reference from the section entitled "Trustees and
Executive Officers" in the Feeder's Part B.
For the fiscal year ended December 31, 1999, Mr. Anderson, Mr. Bayley,
Mr. Patterson (a Trustee until September 27, 1999, when he retired) and Miss
Quigley, who are not directors, officers or employees of AIM or any affiliated
company, each received total compensation of $106,500, $108,500, $80,000 and
$108,500 respectively, from the investment companies which are managed or
administered by AIM for which he or she serves as a Trustee. Fees and expenses
disbursed to the Trustees contained no accrued or payable pension, or retirement
benefits.
AIM and the Master Portfolio have adopted a Code of Ethics which
requires investment personnel and certain other employees (a) to pre-clear
personal securities transactions subject to the Code of Ethics; (b) file reports
regarding such transactions; (c) refrain from personally engaging in (i)
short-term trading of a security, (ii) transactions involving a security within
seven days of an AIM Fund transaction involving the same security (subject to a
de minimis exception), and (iii) transactions involving securities being
considered for investment by an AIM Fund (subject to the de minimis exception);
and (d) abide by certain other provisions of the Code of Ethics. The de minimis
exception under the Code of Ethics covers situations where there is no material
conflict of interest because of the large market capitalization of a security
and the relatively small number of shares involved in a personal transaction.
The Code of Ethics also generally prohibits AIM employee who are registered with
the NASD from purchasing securities in initial public offerings. Personal
trading reports are periodically reviewed by AIM, and the Board of Directors
reviews quarterly and annual reports (which summarize any significant violations
of the Code of Ethics). Sanctions for violating the Code of Ethics may include
censure, monetary penalties, suspension, or termination of employment.
B-2
<PAGE>
ITEM 14. CONTROL PERSONS AND PRINCIPAL HOLDERS OF BENEFICIAL INTERESTS.
- -----------------------------------------------------------------------
As of the date of this filing, Small Cap Fund and Value Fund (each a
"Fund," and collectively, the "Funds") owned 99.9% and 99.9% of the value of the
outstanding beneficial interests in Small Cap Portfolio and Value Portfolio,
respectively. Because each Fund currently controls its corresponding Portfolio,
each Fund may take actions affecting its corresponding Portfolio without the
approval of any other investor.
Each Fund has informed its corresponding Portfolio that whenever a Fund
is requested to vote on any proposal of its corresponding Portfolio, it will
hold a meeting of shareholders and will cast its vote as instructed by its
shareholders. It is anticipated that other investors in each Portfolio will
follow the same or a similar practice.
The address of the Master Portfolio is 11 Greenway Plaza, Suite 100,
Houston, Texas 77046.
As of April 24, 2000, the officers and Trustees and their families as a
group owned in the aggregate beneficially or of record less than 1% of the
outstanding interests of each Portfolio.
ITEM 15. INVESTMENT ADVISORY AND OTHER SERVICES.
- -------------------------------------------------
Information on the investment management and other services provided
for or on behalf of the Portfolios is incorporated herein by reference from the
sections entitled "Management" and "Miscellaneous Information" in the Feeder's
Part B. The following list identifies the specific sections in the Feeder's Part
B under which the information required by Item 15 of Form N-1A may be found;
each section is incorporated herein by reference.
======================= ============================================
Item 15 (a) Management; Miscellaneous Information
----------------------- --------------------------------------------
Item 15 (b) Not applicable
----------------------- --------------------------------------------
Item 15 (c) Not applicable
----------------------- --------------------------------------------
Item 15 (d) Management
----------------------- --------------------------------------------
Item 15 (e) Not applicable
----------------------- --------------------------------------------
Item 15 (f) Not applicable
----------------------- --------------------------------------------
Item 15 (g) Not applicable
----------------------- --------------------------------------------
Item 15 (h) Miscellaneous Information
======================= ============================================
For the fiscal year ended December 31, 1997, the Small Cap Portfolio
and Value Portfolio paid investment management and administration fees to
INVESCO (NY), Inc. in the amounts of $120,544 and $74,372, respectively. For the
period January 1, 1998 to May 29, 1998, the Small Cap Portfolio and Value
Portfolio paid investment management and administration fees to INVESCO (NY),
Inc. in the amounts of $63,895 and $53,350, respectively. For the period May 30,
B-3
<PAGE>
1998 to December 31, 1998, the Small Cap Portfolio and Value Portfolio paid
aggregate investment management and administration fees to AIM in the amounts of
$95,843 and $80,025, respectively. For the fiscal year ended December 31, 1999,
the Small Cap Portfolio and Value Portfolio paid aggregate investment management
and administration fees to AIM in the amounts of $1,217,426 and 313,518,
respectively.
For the fiscal years ended December 31, 1997 and 1998, INVESCO (NY),
Inc. reimbursed the Small Cap Portfolio and Value Portfolio for their respective
investment management and administration fees in the amounts of $67,837 and
$93,076; and $74,372 and $60,760, respectively. For the fiscal year ended
December 31, 1999, AIM reimbursed the Small Cap Portfolio and Value Portfolio
for their respective investment management and administration fees in the
amounts of $0 and $0, respectively. All expense reimbursements, if any, are made
at the Fund level.
ITEM 16. BROKERAGE ALLOCATION AND OTHER PRACTICES.
- ---------------------------------------------------
A description of the Portfolios' brokerage allocation and other
practices is incorporated herein by reference from the section entitled
"Execution of Portfolio Transactions" in the Feeder's Part B.
ITEM 17. CAPITAL STOCK AND OTHER SECURITIES.
- ---------------------------------------------
Under the Master Portfolio's Agreement and Declaration of Trust, the
Trustees are authorized to issue beneficial interests in separate subtrusts or
"series" of the Master Portfolio. The Master Portfolio currently has two series
(i.e., the Portfolios). The Master Portfolio reserves the right to create and
issue additional series. An investor in a Portfolio is entitled to participate
pro rata in distributions of the Portfolio's income and gains and to be
allocated a pro rata share of the Portfolio's income, gains, losses, deductions,
and credits. Upon liquidation or dissolution of a Portfolio, investors are
entitled to share pro rata in that Portfolio's net assets available for
distribution to its investors. Investments in each Portfolio may not be
transferred, but an investor may withdraw all or any portion of its investment
at any time at net asset value. Investments in a Portfolio have no preference,
preemptive, conversion or similar rights.
Under Delaware law, the Small Cap Fund and Value Fund and other
entities investing in the Portfolios enjoy the same limitations of liability
extended to shareholders of private, for-profit corporations. There is a remote
possibility, however, that under certain circumstances an investor in a
Portfolio may be held liable for the Portfolio's obligations. However, the
Master Portfolio's Agreement and Declaration of Trust disclaims shareholder
liability for acts or obligations of the Portfolios and requires that notice of
such disclaimer be given in each agreement, obligation or instrument entered
into or executed by the Portfolio or a trustee. The Agreement and Declaration of
Trust also provides for indemnification from the Portfolio property for all
losses and expenses of any shareholder held personally liable for the
Portfolios' obligations. Thus, the risk of an investor incurring financial loss
on account of such liability is limited to circumstances in which the Portfolios
themselves would be unable to meet their obligations and where the other party
was held not to be bound by the disclaimer. The Agreement and Declaration of
Trust also provides that each Portfolio shall maintain appropriate insurance
B-4
<PAGE>
(for example, fidelity bonding and errors and omissions insurance) covering
certain kinds of potential liabilities. Thus, the risk of an investor incurring
financial loss on account of investor liability is limited to circumstances in
which both inadequate insurance existed and the investor's Portfolio itself was
unable to meet its obligations.
Each investor in a Portfolio is entitled to vote in proportion to the
amount of its investment in that Portfolio. Investors in the Portfolios will all
vote together in certain circumstances (e.g., election of the Trustees and
auditors, and as required by the 1940 Act and the rules thereunder). Investors
in a Portfolio do not have cumulative voting rights, and investors holding more
than 50% of the aggregate beneficial interest in the Master Portfolio or in a
Portfolio, as the case may be, may control the outcome of these votes. Investors
also have under certain circumstances the right to remove one or more Trustees
without a meeting. The Master Portfolio is not required to hold annual meetings
of investors but the Master Portfolio will hold special meetings of investors
when in the judgment of the Master Portfolio's Trustees it is necessary or
desirable to submit matters for an investor vote. No amendment may be made to
the Master Portfolio's Agreement and Declaration of Trust without the
affirmative majority vote of investors (with the vote of each being in
proportion to the amount of its investment).
As of the date of this Registration Statement, AIM Growth Series owns a
majority interest in the Master Portfolio and each Portfolio. However, AIM
Growth Series has undertaken that, with respect to most matters on which the
Master Portfolio seeks a vote of its interestholders, AIM Growth Series will
seek a vote of its shareholders and will vote its interest in the Master
Portfolio in accordance with their instructions.
The Master Portfolio or any Portfolio may be terminated by (1) "the
vote of a majority of the outstanding voting securities" (as defined in the 1940
Act) of the Master Portfolio or the affected Portfolio, respectively, or (2) if
there are fewer than 100 record owners of a beneficial interest in the Master
Portfolio or of such terminating Portfolio, the Trustees pursuant to written
notice to the record owners of the Master Portfolio or the affected Portfolio.
The Trustees may cause (i) the Master Portfolio or one or more of its Portfolios
to the extent consistent with applicable law to sell all or substantially all of
its assets, or be merged into or consolidated with another business trust or
company, (ii) the beneficial interests of a record owner in the Master Portfolio
or any Portfolio to be converted into beneficial interests in another business
trust (or series thereof) created pursuant to Section 10.4 of Article X of the
Master Portfolio's Agreement and Declaration of Trust, or (iii) the beneficial
interests of a record owner of the Master Portfolio to be exchanged under or
pursuant to any state or federal statute to the extent permitted by law. In all
respects not governed by statute or applicable law, the Trustees shall have the
power to prescribe the procedure necessary or appropriate to accomplish a sale
of assets, merger or consolidation including the power to create one or more
separate business trusts to which all or any part of the assets, liabilities,
profits or losses of the Trust may be transferred and to provide for the
conversion of interests in the Trust or any Portfolio into beneficial interests
in such separate business trust or trusts (or series or class thereof).
The Agreement and Declaration of Trust provides that obligations of
each Portfolio are not binding upon the Trustees individually but only upon the
B-5
<PAGE>
property of that Portfolio and that the Trustees will not be liable for any
action or failure to act, but nothing in the Agreement and Declaration of Trust
protects a Trustee against any liability to which he would otherwise be subject
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of his or her office. The
Agreement and Declaration of Trust provides that the Trustees and officers will
be indemnified by the Master Portfolio against liabilities and expenses incurred
in connection with litigation in which they may be involved because of their
offices with the Master Portfolio, unless, as to liability to the Master
Portfolio or its investors, it is finally adjudicated that they engaged in
willful misfeasance, bad faith, gross negligence or reckless disregard of the
duties involved in their offices, or unless with respect to any other matter it
is finally adjudicated that they did not act in good faith in the reasonable
belief that their actions were in the best interests of the Master Portfolio. In
the case of settlement, such indemnification will not be provided unless it has
been determined by a court or other body approving the settlement or other
disposition, or by a reasonable determination, based upon a review of readily
available facts, by vote of a majority of disinterested Trustees or in a written
opinion of independent counsel, that such officers or Trustees have not engaged
in willful misfeasance, bad faith, gross negligence or reckless disregard of
their duties.
ITEM 18. PURCHASE, REDEMPTION, AND PRICING OF SECURITIES.
- ---------------------------------------------------------
Beneficial interests in each Portfolio are issued solely in private
placement transactions that do not involve any "public offering" within the
meaning of Section 4(2) of the 1933 Act.
Information on the method followed by the Portfolios in determining
their net asset value and the timing of such determination is incorporated by
reference from the section entitled "Net Asset Value Determination" in the
Feeder's Part B. See also Item 7 in Part A.
Each Portfolio reserves the right, if conditions exist which make cash
payments undesirable, to honor any request for redemption or repurchase order by
making payment in whole or in part in readily marketable securities chosen by
that Portfolio and valued as they are for purposes of computing the Portfolio's
net asset value (a redemption in kind). If payment is made in securities, an
investor may incur transaction expenses in converting these securities into
cash. Each Portfolio has elected, however, to be governed by Rule 18f-1 under
the 1940 Act as a result of which each Portfolio is obligated to redeem
beneficial interests with respect to any one investor during any 90 day period,
solely in cash up to the lesser of $250,000 or 1% of the net asset value of that
Portfolio at the beginning of the period.
Each investor in a Portfolio may add to or redeem its investment in
that Portfolio on each day that the NYSE is open for trading. At the close of
trading, on each such day, the value of each investor's interest in a Portfolio
will be determined by multiplying the net asset value of such Portfolio by the
percentage representing that investor's share of the aggregate beneficial
interests in that Portfolio. Any additions or reductions that are to be effected
on that day will then be effected. The investor's percentage of the aggregate
beneficial interests in a Portfolio will then be recomputed as the percentage
equal to the fraction (i) the numerator of which is the value of such investor's
investment in the Portfolio as of the close of trading on such day plus or
minus, as the case may be, the amount of net additions to or reductions in the
B-6
<PAGE>
investor's investment in that Portfolio effected on such day, and (ii) the
denominator of which is the aggregate net asset value of the Portfolio as of the
close of trading on such day plus or minus, as the case may be, the amount of
the net additions to or reductions in the aggregate investments in that
Portfolio by all investors in that Portfolio. The percentage so determined will
then be applied to determine the value of the investor's interest in that
Portfolio as of the close of trading on the following day the NYSE is open for
trading.
ITEM 19. TAXATION OF THE PORTFOLIOS.
- -------------------------------------
Information on the taxation of the Portfolios is incorporated by
reference from the section entitled "Dividends, Distributions and Tax Matters"
in the Feeder's Part B.
ITEM 20. UNDERWRITERS.
- -----------------------
Not applicable.
ITEM 21. CALCULATION OF PERFORMANCE DATA.
- ------------------------------------------
Not applicable.
ITEM 22. FINANCIAL STATEMENTS.
- -------------------------------
The audited financial statements of Small Cap Portfolio and Value
Portfolio for the fiscal year ended December 31, 1999, are included herein, in
reliance on the report of PricewaterhouseCoopers LLP, independent auditors,
given on the authority of said firm as experts in auditing and accounting.
B-7
<PAGE>
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMMON STOCKS & OTHER EQUITY
INTERESTS-88.02%
AEROSPACE/DEFENSE-0.22%
Primex Technologies, Inc. 75,000 $ 1,556,250
- --------------------------------------------------------------
AIRLINES-0.28%
Frontier Airlines, Inc.(a) 125,000 1,421,875
- --------------------------------------------------------------
Mesaba Holdings, Inc.(a) 50,000 571,875
- --------------------------------------------------------------
1,993,750
- --------------------------------------------------------------
AUTO PARTS & EQUIPMENT-0.11%
Tower Automotive, Inc.(a) 50,000 771,875
- --------------------------------------------------------------
BANKS (REGIONAL)-1.03%
Bank of the Ozarks, Inc. 30,000 585,000
- --------------------------------------------------------------
Columbia Bancorp 30,000 213,750
- --------------------------------------------------------------
Prosperity Bancshares, Inc. 40,000 640,000
- --------------------------------------------------------------
Silicon Valley Bancshares(a) 60,000 2,970,000
- --------------------------------------------------------------
Southwest Bancorp. of Texas,
Inc.(a) 100,250 1,986,203
- --------------------------------------------------------------
Whitney Holding Corp. 25,000 926,562
- --------------------------------------------------------------
7,321,515
- --------------------------------------------------------------
<PAGE>
BIOTECHNOLOGY-0.90%
Caliper Technologies Corp.(a) 95,400 6,367,950
- --------------------------------------------------------------
BROADCASTING (TELEVISION, RADIO & CABLE)-1.58%
Cox Radio, Inc.-Class A(a) 15,000 1,496,250
- --------------------------------------------------------------
Entercom Communications Corp.(a) 50,000 3,300,000
- --------------------------------------------------------------
Radio One, Inc.(a) 70,000 6,440,000
- --------------------------------------------------------------
11,236,250
- --------------------------------------------------------------
BUILDING MATERIALS-0.15%
Simpson Manufacturing Co., Inc.(a) 25,000 1,093,750
- --------------------------------------------------------------
CHEMICALS (SPECIALTY)-1.53%
Cambrex Corp. 40,000 1,377,500
- --------------------------------------------------------------
OM Group, Inc. 60,000 2,066,250
- --------------------------------------------------------------
Optical Coating Laboratory, Inc. 25,000 7,400,000
- --------------------------------------------------------------
10,843,750
- --------------------------------------------------------------
COMMUNICATIONS EQUIPMENT-6.82%
Aether Systems, Inc.(a) 35,000 2,506,875
- --------------------------------------------------------------
Aspect Communications Corp.(a) 100,000 3,912,500
- --------------------------------------------------------------
Copper Mountain Networks, Inc.(a) 10,000 487,500
- --------------------------------------------------------------
Davox Corp.(a) 140,000 2,747,500
- --------------------------------------------------------------
Digital Lightwave, Inc.(a) 90,000 5,760,000
- --------------------------------------------------------------
Finisar Corp.(a) 34,900 3,136,637
- --------------------------------------------------------------
Harmonic, Inc.(a) 40,000 3,797,500
- --------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMMUNICATIONS EQUIPMENT-(CONTINUED)
Ortel Corp.(a) 90,000 $ 10,800,000
- --------------------------------------------------------------
Paradyne Networks, Inc.(a) 15,000 408,750
- --------------------------------------------------------------
Polycom, Inc.(a) 105,000 6,687,187
- --------------------------------------------------------------
Proxim, Inc.(a) 50,000 5,500,000
- --------------------------------------------------------------
Tut Systems, Inc.(a) 50,000 2,681,250
- --------------------------------------------------------------
48,425,699
- --------------------------------------------------------------
COMPUTERS (HARDWARE)-0.39%
Visual Networks, Inc.(a) 35,000 2,773,750
- --------------------------------------------------------------
COMPUTERS (NETWORKING)-2.29%
Computer Network Technology
Corp.(a) 75,000 1,720,312
- --------------------------------------------------------------
Emulex Corp.(a) 100,000 11,250,000
- --------------------------------------------------------------
Gadzoox Networks, Inc.(a) 75,000 3,267,187
- --------------------------------------------------------------
16,237,499
- --------------------------------------------------------------
COMPUTERS (PERIPHERALS)-3.69%
Actel Corp.(a) 140,000 3,360,000
- --------------------------------------------------------------
Cybex Computer Products Corp.(a) 65,000 2,632,500
- --------------------------------------------------------------
Key Tronic Corp.(a) 200,000 750,000
- --------------------------------------------------------------
Media 100 Inc.(a) 150,000 3,965,625
- --------------------------------------------------------------
SanDisk Corp.(a) 60,000 5,775,000
- --------------------------------------------------------------
Silicon Storage Technology,
Inc.(a) 125,000 5,156,250
- --------------------------------------------------------------
SmartDisk Corp.(a) 23,700 776,175
- --------------------------------------------------------------
Xircom, Inc.(a) 50,000 3,750,000
- --------------------------------------------------------------
26,165,550
- --------------------------------------------------------------
COMPUTERS (SOFTWARE &
SERVICES)-17.03%
Active Voice Corp.(a) 100,000 2,906,250
- --------------------------------------------------------------
Activision, Inc.(a) 115,000 1,760,937
- --------------------------------------------------------------
Allaire Corp.(a) 30,000 4,350,000
- --------------------------------------------------------------
Allscripts, Inc.(a) 30,000 1,320,000
- --------------------------------------------------------------
Alteon Websystems, Inc.(a) 20,000 1,755,000
- --------------------------------------------------------------
Art Technology Group, Inc.(a) 82,900 10,621,562
- --------------------------------------------------------------
Banyan Systems Inc.(a) 75,000 1,500,000
- --------------------------------------------------------------
Best Software, Inc.(a) 85,000 2,507,500
- --------------------------------------------------------------
Brio Technology, Inc.(a) 40,000 1,680,000
- --------------------------------------------------------------
BSQUARE Corp.(a) 30,500 1,279,094
- --------------------------------------------------------------
Business Objects S.A.-ADR
(France)(a) 35,000 4,676,875
- --------------------------------------------------------------
CacheFlow Inc.(a) 19,000 2,483,062
- --------------------------------------------------------------
Concord Communications, Inc.(a) 30,000 1,331,250
- --------------------------------------------------------------
Documentum, Inc.(a) 50,000 2,993,750
- --------------------------------------------------------------
Entrust Technologies, Inc. 90,000 5,394,375
- --------------------------------------------------------------
Great Plains Software, Inc.(a) 30,000 2,242,500
- --------------------------------------------------------------
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMPUTERS (SOFTWARE & SERVICES)-(CONTINUED)
InfoCure Corp.(a) 75,000 $ 2,339,062
- --------------------------------------------------------------
Integrated Measurement Systems,
Inc.(a) 125,000 1,765,625
- --------------------------------------------------------------
ISS Group, Inc.(a) 35,000 2,489,375
- --------------------------------------------------------------
Kronos, Inc.(a) 40,000 2,400,000
- --------------------------------------------------------------
Macromedia, Inc.(a) 10,000 731,250
- --------------------------------------------------------------
Mediaplex, Inc.(a) 100,000 6,275,000
- --------------------------------------------------------------
Micromuse, Inc.(a) 10,000 1,700,000
- --------------------------------------------------------------
MTI Technology Corp.(a) 75,000 2,765,625
- --------------------------------------------------------------
Natural MicroSystems Corp.(a) 100,000 4,681,250
- --------------------------------------------------------------
NEON Systems, Inc.(a) 60,000 2,355,000
- --------------------------------------------------------------
Netegrity, Inc.(a) 50,000 2,846,875
- --------------------------------------------------------------
nFront, Inc.(a) 50,000 1,000,000
- --------------------------------------------------------------
Open TV Corp.(a) 70,000 5,617,500
- --------------------------------------------------------------
pcOrder.com, Inc.(a) 40,000 2,040,000
- --------------------------------------------------------------
QRS Corp.(a) 30,000 3,150,000
- --------------------------------------------------------------
Radiant Systems, Inc.(a) 155,000 6,229,062
- --------------------------------------------------------------
RadiSys Corp.(a) 75,000 3,825,000
- --------------------------------------------------------------
Rare Medium Group, Inc.(a) 150,000 5,118,750
- --------------------------------------------------------------
ScanSource, Inc.(a) 85,000 3,447,812
- --------------------------------------------------------------
Scientific Learning Corp.(a) 23,100 843,150
- --------------------------------------------------------------
Spyglass, Inc.(a) 35,000 1,327,266
- --------------------------------------------------------------
Talk City, Inc.(a) 150,000 3,918,750
- --------------------------------------------------------------
Transaction Systems Architects,
Inc.-Class A(a) 85,000 2,380,000
- --------------------------------------------------------------
TSI International Software Ltd.(a) 25,000 1,415,625
- --------------------------------------------------------------
Xpedior Inc.(a) 49,000 1,408,750
- --------------------------------------------------------------
120,872,882
- --------------------------------------------------------------
<PAGE>
CONSUMER (JEWELRY, NOVELTIES & GIFTS)-0.20%
Fossil, Inc.(a) 60,000 1,387,500
- --------------------------------------------------------------
CONSUMER FINANCE-0.24%
AmeriCredit Corp.(a) 30,000 555,000
- --------------------------------------------------------------
Federal Agricultural Mortgage
Corp.-Class C(a) 57,000 1,150,687
- --------------------------------------------------------------
1,705,687
- --------------------------------------------------------------
DISTRIBUTORS (FOOD & HEALTH)-0.32%
Accredo Health, Inc.(a) 75,000 2,306,250
- --------------------------------------------------------------
ELECTRICAL EQUIPMENT-5.41%
Cree Research, Inc.(a) 70,000 5,976,250
- --------------------------------------------------------------
Crossroads Systems, Inc.(a) 15,000 1,267,500
- --------------------------------------------------------------
Helix Technology Corp. 80,000 3,585,000
- --------------------------------------------------------------
Kemet Corp.(a) 85,000 3,830,312
- --------------------------------------------------------------
LaserSight, Inc.(a) 75,000 750,000
- --------------------------------------------------------------
Optimal Robotics Corp.(a) 85,000 3,166,250
- --------------------------------------------------------------
Pinnacle Systems, Inc.(a) 100,000 4,068,750
- --------------------------------------------------------------
Rayovac Corp.(a) 45,000 849,375
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
ELECTRICAL EQUIPMENT-(CONTINUED)
Sawtek, Inc.(a) 100,000 $ 6,656,250
- --------------------------------------------------------------
Three-Five Systems, Inc.(a) 166,666 6,833,306
- --------------------------------------------------------------
Veeco Instruments Inc.(a) 30,000 1,404,375
- --------------------------------------------------------------
38,387,368
- --------------------------------------------------------------
ELECTRONICS (COMPONENT DISTRIBUTORS)-2.21%
C-COR.net Corp.(a) 100,000 7,662,500
- --------------------------------------------------------------
Kent Electronics Corp.(a) 70,000 1,592,500
- --------------------------------------------------------------
Power-One, Inc.(a) 140,000 6,413,750
- --------------------------------------------------------------
15,668,750
- --------------------------------------------------------------
ELECTRONICS (DEFENSE)-0.72%
Aeroflex, Inc.(a) 100,000 1,037,500
- --------------------------------------------------------------
Anaren Microwave, Inc.(a) 75,000 4,059,375
- --------------------------------------------------------------
5,096,875
- --------------------------------------------------------------
<PAGE>
ELECTRONICS
(INSTRUMENTATION)-2.47%
Alpha Industries, Inc.(a) 80,000 4,585,000
- --------------------------------------------------------------
Methode Electronics, Inc.-Class A 100,000 3,212,500
- --------------------------------------------------------------
Photon Dynamics, Inc.(a) 65,000 2,518,750
- --------------------------------------------------------------
Tektronix, Inc. 65,000 2,526,875
- --------------------------------------------------------------
Varian Inc.(a) 210,000 4,725,000
- --------------------------------------------------------------
17,568,125
- --------------------------------------------------------------
ELECTRONICS (SEMICONDUCTORS)-3.87%
ANADIGICS, Inc.(a) 100,000 4,718,750
- --------------------------------------------------------------
Applied Micro Circuits Corp.(a) 20,000 2,545,000
- --------------------------------------------------------------
Elantec Semiconductor, Inc.(a) 150,000 4,950,000
- --------------------------------------------------------------
GlobeSpan, Inc.(a) 50,000 3,256,250
- --------------------------------------------------------------
MIPS Technologies, Inc.(a) 50,000 2,600,000
- --------------------------------------------------------------
PLX Technology, Inc.(a) 40,000 757,500
- --------------------------------------------------------------
S3, Inc.(a) 75,000 867,187
- --------------------------------------------------------------
TranSwitch Corp.(a) 30,050 2,180,503
- --------------------------------------------------------------
Zoran Corp.(a) 100,000 5,575,000
- --------------------------------------------------------------
27,450,190
- --------------------------------------------------------------
EQUIPMENT (SEMICONDUCTOR)-2.22%
Advanced Energy Industries,
Inc.(a) 50,000 2,462,500
- --------------------------------------------------------------
Asyst Technologies, Inc.(a) 100,000 6,556,250
- --------------------------------------------------------------
Brooks Automation, Inc.(a) 75,000 2,442,188
- --------------------------------------------------------------
Credence Systems Corp.(a) 25,000 2,162,500
- --------------------------------------------------------------
Kulicke & Soffa Industries,
Inc.(a) 50,000 2,128,125
- --------------------------------------------------------------
15,751,563
- --------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-0.18%
Advanta Corp.-Class B 90,000 1,265,625
- --------------------------------------------------------------
FOODS-0.70%
Ben & Jerry's Homemade, Inc.-Class
A(a) 45,000 1,119,375
- --------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
FOODS-(CONTINUED)
Hain Food Group, Inc. (The)(a) 75,000 $ 1,678,125
- --------------------------------------------------------------
Horizon Organic Holding Corp.(a) 100,000 750,000
- --------------------------------------------------------------
United Natural Foods, Inc.(a) 120,000 1,440,000
- --------------------------------------------------------------
4,987,500
- --------------------------------------------------------------
FOOTWEAR-0.16%
Saucony, Inc.(a) 75,000 1,106,250
- --------------------------------------------------------------
GAMING, LOTTERY & PARIMUTUEL COMPANIES-0.71%
Hollywood Park, Inc.(a) 150,000 3,365,625
- --------------------------------------------------------------
Station Casinos, Inc.(a) 75,000 1,682,813
- --------------------------------------------------------------
5,048,438
- --------------------------------------------------------------
HEALTH CARE (DRUGS-GENERIC & OTHER)-2.52%
Anesta Corp.(a) 215,000 3,695,313
- --------------------------------------------------------------
Barr Laboratories, Inc.(a) 11,800 370,225
- --------------------------------------------------------------
Jones Pharma, Inc. 28,200 1,224,938
- --------------------------------------------------------------
Maxygen Inc.(a) 50,000 3,550,000
- --------------------------------------------------------------
Medicis Pharmaceutical Corp.-Class
A(a) 75,000 3,192,188
- --------------------------------------------------------------
Metricom, Inc.(a) 50,000 3,931,250
- --------------------------------------------------------------
Penwest Pharmaceuticals Co.(a) 125,000 1,906,250
- --------------------------------------------------------------
17,870,164
- --------------------------------------------------------------
HEALTH CARE (HOSPITAL MANAGEMENT)-0.83%
LifePoint Hospitals, Inc.(a) 275,000 3,248,438
- --------------------------------------------------------------
Triad Hospitals Holdings Inc.(a) 175,000 2,646,875
- --------------------------------------------------------------
5,895,313
- --------------------------------------------------------------
<PAGE>
HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES)-1.69%
Biosite Diagnostics, Inc.(a) 100,000 1,600,000
- --------------------------------------------------------------
EndoSonics Corp.(a) 300,000 1,350,000
- --------------------------------------------------------------
Mentor Corp. 65,000 1,677,813
- --------------------------------------------------------------
PolyMedica Corp.(a) 90,000 2,081,250
- --------------------------------------------------------------
ResMed, Inc.(a) 35,000 1,461,250
- --------------------------------------------------------------
Zoll Medical Corp.(a) 100,000 3,818,750
- --------------------------------------------------------------
11,989,063
- --------------------------------------------------------------
HEALTH CARE (SPECIALIZED
SERVICES)-1.78%
Advance Paradigm, Inc.(a) 40,000 862,500
- --------------------------------------------------------------
Capital Senior Living Corp.(a) 150,000 759,375
- --------------------------------------------------------------
CareInsite, Inc.(a) 35,000 2,817,500
- --------------------------------------------------------------
Hooper Holmes, Inc. 24,400 628,300
- --------------------------------------------------------------
Orthodontic Centers of America,
Inc.(a) 50,000 596,875
- --------------------------------------------------------------
Priority Healthcare Corp.(a) 50,000 1,446,875
- --------------------------------------------------------------
Techne Corp.(a) 100,000 5,506,250
- --------------------------------------------------------------
12,617,675
- --------------------------------------------------------------
INSURANCE (LIFE/HEALTH)-0.05%
Annuity and Life Reassurance, Ltd.
(Bermuda) 13,000 339,625
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
INSURANCE
(PROPERTY-CASUALTY)-0.14%
Medical Assurance, Inc. 48,350 $ 1,024,416
- --------------------------------------------------------------
INVESTMENT MANAGEMENT-0.35%
Charles River Associates, Inc.(a) 75,000 2,512,500
- --------------------------------------------------------------
IRON & STEEL-0.21%
Gibraltar Steel Corp. 65,000 1,519,375
- --------------------------------------------------------------
LEISURE TIME (PRODUCTS)-2.18%
JAKKS Pacific, Inc.(a) 90,000 1,681,875
- --------------------------------------------------------------
Meade Instruments Corp.(a) 120,000 3,420,000
- --------------------------------------------------------------
Monaco Coach Corp.(a) 75,000 1,917,188
- --------------------------------------------------------------
National R.V. Holdings, Inc.(a) 85,000 1,636,250
- --------------------------------------------------------------
THQ Inc.(a) 97,500 2,260,781
- --------------------------------------------------------------
Zomax Optical Media, Inc.(a) 100,000 4,525,000
- --------------------------------------------------------------
15,441,094
- --------------------------------------------------------------
MACHINERY (DIVERSIFIED)-0.29%
Terex Corp.(a) 75,000 2,081,250
- --------------------------------------------------------------
MANUFACTURING (DIVERSIFIED)-1.14%
Kopin Corp.(a) 140,000 5,880,000
- --------------------------------------------------------------
Spartech Corp. 70,000 2,257,500
- --------------------------------------------------------------
8,137,500
- --------------------------------------------------------------
<PAGE>
MANUFACTURING (SPECIALIZED)-0.92%
Applied Science and Technology,
Inc.(a) 125,000 4,154,297
- --------------------------------------------------------------
Dril-Quip, Inc.(a) 40,000 1,215,000
- --------------------------------------------------------------
Summa Industries(a) 100,000 1,156,250
- --------------------------------------------------------------
6,525,547
- --------------------------------------------------------------
METAL FABRICATORS-0.27%
Shaw Group, Inc.(a) 75,000 1,898,438
- --------------------------------------------------------------
NATURAL GAS-0.25%
Kinder Morgan, Inc. 90,000 1,816,875
- --------------------------------------------------------------
OFFICE EQUIPMENT & SUPPLIES-0.32%
Miami Computer Supply Corp.(a)(b) 60,800 2,257,200
- --------------------------------------------------------------
OIL & GAS (DRILLING &
EQUIPMENT)-2.93%
Cal Dive International, Inc.(a) 50,000 1,656,250
- --------------------------------------------------------------
CARBO Ceramics, Inc. 55,000 1,203,125
- --------------------------------------------------------------
Core Laboratories N.V.
(Netherlands)(a) 60,000 1,203,750
- --------------------------------------------------------------
Gulfmark Offshore, Inc.(a) 50,000 731,250
- --------------------------------------------------------------
Hanover Compressor Co.(a) 50,000 1,887,500
- --------------------------------------------------------------
Key Energy Group, Inc.(a) 250,000 1,296,875
- --------------------------------------------------------------
Marine Drilling Companies, Inc.(a) 150,000 3,365,625
- --------------------------------------------------------------
Maverick Tube Corp.(a) 100,000 2,468,750
- --------------------------------------------------------------
Pride International, Inc.(a) 200,000 2,925,000
- --------------------------------------------------------------
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
OIL & GAS (DRILLING & EQUIPMENT)-(CONTINUED)
UTI Energy Corp.(a) 175,000 $ 4,035,938
- --------------------------------------------------------------
20,774,063
- --------------------------------------------------------------
OIL & GAS (EXPLORATION & PRODUCTION)-1.22%
Cabot Oil & Gas Corp.-Class A 55,000 883,438
- --------------------------------------------------------------
Evergreen Resources, Inc.(a) 95,000 1,876,250
- --------------------------------------------------------------
Louis Dreyfus Natural Gas Corp.(a) 110,000 1,993,750
- --------------------------------------------------------------
Newfield Exploration Co.(a) 125,000 3,343,750
- --------------------------------------------------------------
Stone Energy Corp.(a) 15,000 534,375
- --------------------------------------------------------------
8,631,563
- --------------------------------------------------------------
PERSONAL CARE-0.07%
Steiner Leisure Ltd.(a) 28,400 473,925
- --------------------------------------------------------------
REAL ESTATE INVESTMENT
TRUSTS-0.03%
Correctional Properties Trust 20,000 245,000
- --------------------------------------------------------------
RESTAURANTS-1.74%
P.F. Chang's China Bistro, Inc.(a) 125,000 3,109,375
- --------------------------------------------------------------
PJ America, Inc.(a) 100,000 1,550,000
- --------------------------------------------------------------
Rare Hospitality International,
Inc.(a) 110,000 2,380,469
- --------------------------------------------------------------
Rubio's Restaurants, Inc.(a) 125,000 1,000,000
- --------------------------------------------------------------
Sonic Corp.(a) 115,000 3,277,500
- --------------------------------------------------------------
Taco Cabana-Class A(a) 125,000 1,015,625
- --------------------------------------------------------------
12,332,969
- --------------------------------------------------------------
RETAIL (COMPUTERS &
ELECTRONICS)-1.32%
Tweeter Home Entertainment Group,
Inc.(a) 170,000 6,035,000
- --------------------------------------------------------------
Ultimate Electronics, Inc.(a) 135,000 3,341,250
- --------------------------------------------------------------
9,376,250
- --------------------------------------------------------------
<PAGE>
RETAIL (DISCOUNTERS)-0.24%
99 Cents Only Stores(a) 45,000 1,721,250
- --------------------------------------------------------------
RETAIL (FOOD CHAINS)-0.26%
Wild Oats Markets, Inc.(a) 82,500 1,830,469
- --------------------------------------------------------------
RETAIL (SPECIALTY)-1.46%
BOWLIN Outdoor Advertising &
Travel Centers Inc.(a) 50,000 262,500
- --------------------------------------------------------------
Coldwater Creek, Inc.(a) 100,000 2,050,000
- --------------------------------------------------------------
CSK Auto Corp.(a) 80,000 1,400,000
- --------------------------------------------------------------
Hollywood Entertainment Corp.(a) 220,000 3,190,000
- --------------------------------------------------------------
Rent-Way, Inc.(a) 65,000 1,214,688
- --------------------------------------------------------------
Sunglass Hut International,
Inc.(a) 200,000 2,250,000
- --------------------------------------------------------------
10,367,188
- --------------------------------------------------------------
RETAIL (SPECIALTY-APPAREL)-2.22%
Braun's Fashions Corp.(a) 127,500 2,677,500
- --------------------------------------------------------------
Chico's Fas, Inc.(a) 70,000 2,633,750
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
RETAIL (SPECIALTY-APPAREL)-(CONTINUED)
Children's Place Retail Stores,
Inc. (The)(a) 90,000 $ 1,479,375
- --------------------------------------------------------------
Deb Shops, Inc. 112,500 2,081,250
- --------------------------------------------------------------
Factory 2-U Stores, Inc.(a) 75,000 2,128,125
- --------------------------------------------------------------
Too Inc.(a) 275,000 4,743,750
- --------------------------------------------------------------
15,743,750
- --------------------------------------------------------------
SAVINGS & LOAN COMPANIES-0.23%
Bay View Capital Corp. 70,000 993,125
- --------------------------------------------------------------
Queens County Bancorp, Inc. 25,000 678,125
- --------------------------------------------------------------
1,671,250
- --------------------------------------------------------------
SERVICES (ADVERTISING/MARKETING)-0.24%
Lamar Advertising Co.(a) 8,600 520,838
- --------------------------------------------------------------
Professional Detailing, Inc.(a) 40,000 1,197,500
- --------------------------------------------------------------
1,718,338
- --------------------------------------------------------------
<PAGE>
SERVICES (COMMERCIAL & CONSUMER)-2.99%
Avis Rent A Car, Inc.(a) 100,000 2,556,250
- --------------------------------------------------------------
Cerner Corp.(a) 30,000 590,625
- --------------------------------------------------------------
Championship Auto Racing Teams,
Inc.(a) 70,000 1,610,000
- --------------------------------------------------------------
Copart, Inc.(a) 80,000 3,480,000
- --------------------------------------------------------------
F.Y.I., Inc.(a) 80,000 2,720,000
- --------------------------------------------------------------
Iron Mountain Inc.(a) 59,150 2,325,334
- --------------------------------------------------------------
Provant, Inc.(a) 150,000 3,787,500
- --------------------------------------------------------------
Vialink Co. (The)(a) 100,000 3,637,500
- --------------------------------------------------------------
Wilmar Industries, Inc.(a) 30,000 521,250
- --------------------------------------------------------------
21,228,459
- --------------------------------------------------------------
SERVICES (COMPUTER SYSTEMS)-1.26%
Brocade Communications Systems,
Inc.(a) 30,000 5,310,000
- --------------------------------------------------------------
Insight Enterprises, Inc.(a) 89,875 3,651,172
- --------------------------------------------------------------
8,961,172
- --------------------------------------------------------------
SERVICES (DATA PROCESSING)-0.45%
CheckFree Holdings Corp.(a) 20,000 2,090,000
- --------------------------------------------------------------
Mecon, Inc.(a) 100,000 1,081,250
- --------------------------------------------------------------
3,171,250
- --------------------------------------------------------------
TELECOMMUNICATIONS (CELLULAR/WIRELESS)-1.57%
AirGate PCS Inc.(a) 50,000 2,637,500
- --------------------------------------------------------------
Phone.com, Inc.(a) 18,000 2,086,875
- --------------------------------------------------------------
Powerwave Technologies, Inc.(a) 110,000 6,421,250
- --------------------------------------------------------------
11,145,625
- --------------------------------------------------------------
TELECOMMUNICATIONS (LONG DISTANCE)-0.67%
Primus Telecommunications Group,
Inc.(a) 125,000 4,781,250
- --------------------------------------------------------------
TEXTILES (APPAREL)-0.31%
Cutter & Buck, Inc.(a) 45,000 680,625
- --------------------------------------------------------------
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
TEXTILES (APPAREL)-(CONTINUED)
Quicksilver, Inc.(a) 100,000 $ 1,550,000
- --------------------------------------------------------------
2,230,625
- --------------------------------------------------------------
TRUCKS & PARTS-0.44%
Mobile Mini, Inc.(a) 145,000 3,117,500
- --------------------------------------------------------------
Total Common Stocks & Other
Equity Interests (Cost
$392,751,939) 624,838,522
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
U.S. TREASURY SECURITIES-0.09%
U.S. TREASURY BILLS-0.09%(C)
5.37%, 03/23/00 (Cost $632,318) $ 640,000(d) 632,896
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
MONEY MARKET FUNDS-11.79%
STIC Liquid Assets Portfolio(e) 41,838,104 $ 41,838,104
- --------------------------------------------------------------
STIC Prime Portfolio(e) 41,838,104 41,838,104
- --------------------------------------------------------------
Total Money Market Funds (Cost
$83,676,208) 83,676,208
- --------------------------------------------------------------
TOTAL INVESTMENTS-99.90% (Cost
$477,060,465) 709,147,626
- --------------------------------------------------------------
OTHER ASSETS LESS
LIABILITIES-0.10% 698,824
- --------------------------------------------------------------
NET ASSETS-100.00% $709,846,450
==============================================================
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Security fair valued in accordance with procedures established by the Board
of Trustees.
(c) Interest rate shown represents the rate of discount paid or received at the
time of purchase by the Fund.
(d) Principal balance was pledged as collateral to cover margin requirements for
open futures contracts. See Note 6.
(e) The money market fund has the same investment advisor as the Fund.
See Notes to Financial Statements.
9
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $477,060,465) $709,147,626
- ---------------------------------------------------------
Receivables for:
Investments sold 299,618
- ---------------------------------------------------------
Dividends and interest 443,497
- ---------------------------------------------------------
Variation margin 240,000
- ---------------------------------------------------------
Other assets 4,182
- ---------------------------------------------------------
Total assets 710,134,923
- ---------------------------------------------------------
LIABILITIES:
Accrued advisory fees 269,258
- ---------------------------------------------------------
Accrued custodian fees 19,215
- ---------------------------------------------------------
Total liabilities 288,473
- ---------------------------------------------------------
NET ASSETS APPLICABLE TO BENEFICIAL
INTEREST OUTSTANDING $709,846,450
=========================================================
</TABLE>
<PAGE>
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends $ 1,254,596
- ---------------------------------------------------------
Interest 1,456,259
- ---------------------------------------------------------
Securities lending income 279,432
- ---------------------------------------------------------
Total investment income 2,990,287
- ---------------------------------------------------------
EXPENSES:
Advisory and administrative fees 1,217,426
- ---------------------------------------------------------
Professional fees 398
- ---------------------------------------------------------
Custodian fees 47,628
- ---------------------------------------------------------
Total expenses 1,265,452
- ---------------------------------------------------------
Net investment income 1,724,835
- ---------------------------------------------------------
REALIZED AND UNREALIZED GAIN FROM
INVESTMENT SECURITIES AND FUTURES
CONTRACTS:
Net realized gain from:
Investment securities 12,628,738
- ---------------------------------------------------------
Futures contracts 494,525
- ---------------------------------------------------------
13,123,263
- ---------------------------------------------------------
Change in net unrealized appreciation of:
Investment securities 222,453,296
- ---------------------------------------------------------
Futures contracts 818,250
- ---------------------------------------------------------
223,271,546
- ---------------------------------------------------------
Net gain from investment securities and
futures contracts 236,394,809
- ---------------------------------------------------------
Net increase in net assets resulting from
operations $238,119,644
=========================================================
</TABLE>
See Notes to Financial Statements.
10
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
OPERATIONS:
Net investment income $ 1,724,835 $ 54,125
- --------------------------------------------------------------------------------------------
Net realized gain from investment securities and futures
contracts 13,123,263 988,423
- --------------------------------------------------------------------------------------------
Net change in unrealized appreciation of investment
securities and futures contracts 223,271,546 8,890,666
- --------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 238,119,644 9,933,214
- --------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS:
Contributions 441,138,377 6,052,040
- --------------------------------------------------------------------------------------------
Withdrawals (19,531,276) --
- --------------------------------------------------------------------------------------------
Net increase from beneficial interest transactions 421,607,101 6,052,040
- --------------------------------------------------------------------------------------------
Total increase in net assets 659,726,745 15,985,254
- --------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 50,119,705 34,134,451
- --------------------------------------------------------------------------------------------
End of period $709,846,450 $50,119,705
============================================================================================
</TABLE>
See Notes to Financial Statements.
11
<PAGE>
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
The Small Cap Portfolio (the "Portfolio") is organized as a Delaware business
trust which is registered under the 1940 Act as an open-end management
investment company.
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 the significant accounting policies followed by the
Portfolio in the preparation of their financial statements.
A. Security Valuations -- A security listed or traded on an exchange (except
convertible bonds) is valued at its last sales price on the exchange where
the security is principally traded, or lacking any sales on a particular
day, the security is valued at the closing bid price on that day. Each
security reported on the NASDAQ National Market System is valued at the
last sales price on the valuation date or absent a last sales price, at the
closing bid price. Debt obligations (including convertible bonds) are
valued on the basis of prices provided by an independent pricing service.
Prices provided by the 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 prices are not provided by any of the above methods are valued based
upon quotes furnished by independent sources and are valued at the last bid
price in the case of equity securities and in the case of debt obligations,
the mean between the last bid and asked prices. Securities for which market
quotations are not readily available or are questionable are valued at fair
value as determined in good faith by or under the supervision of the
Trust's and Portfolio's officers in a manner specifically authorized by the
Boards of Trustees. Short-term obligations having 60 days or less to
maturity are valued at amortized cost which approximates market value. For
purposes of determining net asset value per share, futures and option
contracts generally will be valued 15 minutes after the close of trading of
the New York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed each
day at various times prior to the close of the NYSE. The values of such
securities are determined as of such times. Foreign currency exchange rates
are also generally determined prior to the close of the NYSE. 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
NYSE which would not be reflected. 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 Boards of Trustees.
B. Securities Transactions and Investment Income -- Securities transactions
are accounted for on a trade date basis. Realized gains or losses on sales
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 the accrual basis.
C. Federal Income Taxes -- The Portfolio 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.
D. Foreign Currency Contracts -- The Portfolio may purchase or sell 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 Portfolio'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 Portfolio recognizes a realized gain or
loss equal to the difference between the proceeds from, or cost of, the
closing transaction and the Portfolio's basis in the contract. Risks
include the possibility of an illiquid market and that a change in value of
the contracts may not correlate with changes in the value of the securities
being hedged.
<PAGE>
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Portfolio's investment manager and
administrator. The Portfolio pays AIM investment management and administration
fees at an annual rate of 0.475% on the first $500 million of the Portfolio's
average daily net assets, plus 0.45% on the next $500 million of the Portfolio's
average daily net assets, plus 0.425% on the next $500 million of the
Portfolio's average daily net assets, plus 0.40% on the Portfolio's average
daily net assets exceeding $1.5 billion.
NOTE 3-BANK BORROWINGS
The Portfolio 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) $1,000,000,000 or (ii) the limits set by its prospectus for
borrowings. The Portfolio and other funds advised by AIM which are parties to
the line of credit may borrow on a first come, first served basis. During the
year ended December 31, 1999, the Portfolio did not borrow under the line of
credit agreement. The funds which are party to
12
<PAGE>
the line of credit are charged a commitment fee of 0.09% 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. Prior to May 28, 1999, the
Portfolio, along with certain other funds advised and/or administered by AIM,
had a line of credit with BankBoston and State Street Bank & Trust Company. The
arrangements with the banks allowed the Portfolio and certain other funds to
borrow, on a first come, first served basis, an aggregate maximum amount of
$250,000,000.
NOTE 4-PORTFOLIO SECURITIES LOANED
At December 31, 1999, securities with an aggregate value of $45,086,775 were on
loan to brokers. The loans were secured by cash collateral of $45,988,734
received by the Portfolio. For the year ended December 31, 1999, the Portfolio
received fees of $279,432 for securities lending.
For international securities, cash collateral is received by the Portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. The collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the Portfolio against loaned securities in the amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. The
cash collateral is invested in a securities lending trust which consists of a
portfolio of high quality short duration securities whose average effective
duration is restricted to 120 days or less.
NOTE 5-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Portfolio during the year ended December 31, 1999 was
$469,445,449 and $122,073,002, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of December 31, 1999 was as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $246,144,254
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (14,348,086)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $231,796,168
=========================================================
</TABLE>
Cost of investments for tax purposes is $477,351,458.
NOTE 6-FUTURES CONTRACTS
On December 31, 1999, $640,000 principal amount of U.S. Treasury obligations
were pledged as collateral to cover margin requirements for open futures
contracts. Open futures contracts were as follows:
<TABLE>
<CAPTION>
VALUE OF
NO. OF MONTH/ OPEN FUTURES UNREALIZED
CONTRACT CONTRACTS COMMITMENT CONTRACTS APPRECIATION
-------- --------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
Russell 2000 Index 50 Mar-00/Buy $12,748,750 $971,250
- ---------------------------------------------------------------------------
</TABLE>
<PAGE>
NOTE 7-SUPPLEMENTAL DATA
Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, OCTOBER 18, 1995
------------------------------------------ (COMMENCEMENT OF OPERATIONS
1999 1998 1997 1996 TO DECEMBER 31, 1995)
-------- -------- -------- -------- ---------------------------
<S> <C> <C> <C> <C> <C>
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $709,846 $ 50,120 $ 34,134 $ 19,447 $3,746
================================================ ======== ======== ======== ======== ======
Ratio of net investment income (loss) to average
net assets 0.65% 0.16% (0.04)% 0.94% 1.74%(a)
================================================ ======== ======== ======== ======== ======
Ratio of expenses to average net assets:
With expense waivers 0.48% 0.32% 0.56% 0.70% 2.33%(a)
================================================ ======== ======== ======== ======== ======
Without expense waivers 0.48% 0.60% 0.64% 0.70% 2.33%(a)
================================================ ======== ======== ======== ======== ======
Portfolio turnover rate 56% 190% 233% 150% N/A
================================================ ======== ======== ======== ======== ======
</TABLE>
(a) Annualized.
13
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of AIM Growth Series and Shareholders
of AIM Small Cap Growth Portfolio:
In our opinion, the accompanying statement of assets and
liabilities, including the schedule of investments, and
the related statements of operations and of changes in
net assets and the financial highlights present fairly,
in all material respects, the financial position of AIM
Small Cap Growth Portfolio (hereafter referred to as the
"Portfolio") at December 31, 1999, the results of its
operations, the changes in its net assets and the
supplemental data for each of the periods indicated
therein, in conformity with accounting principles
generally accepted in the United States. These financial
statements and supplemental data (hereafter referred to
as "financial statements") are the responsibility of the
Portfolio's management; our responsibility is to express
an opinion on these financial statements based on our
audits. We conducted our audits of these financial
statements in accordance with auditing standards
generally accepted in the United States which require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made
by management, and evaluating the overall financial
statement presentation. We believe that our audits, which
included confirmation of securities at December 31, 1999
by correspondence with the custodian and brokers, provide
a reasonable basis for the opinion expressed above.
PRICEWATERHOUSECOOPERS LLP
Boston, Massachusetts
February 16, 2000
<PAGE>
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
COMMON STOCKS & OTHER EQUITY
INTERESTS-92.54%
BANKS (MAJOR REGIONAL)-1.35%
FleetBoston Financial Corp. 51,800 $ 1,803,287
- --------------------------------------------------------------
BANKS (MONEY CENTER)-2.68%
Bank of America Corp. 71,425 3,584,642
- --------------------------------------------------------------
CHEMICALS (SPECIALTY)-0.75%
Sigma-Aldrich Corp. 33,300 1,001,081
- --------------------------------------------------------------
COMPUTERS (PERIPHERALS)-0.75%
Adaptec, Inc.(a) 20,200 1,007,475
- --------------------------------------------------------------
COMPUTERS (SOFTWARE &
SERVICES)-5.67%
Computer Associates International,
Inc. 54,900 3,839,569
- --------------------------------------------------------------
Synopsys, Inc.(a) 21,500 1,435,125
- --------------------------------------------------------------
Unisys Corp.(a) 72,400 2,312,275
- --------------------------------------------------------------
7,586,969
- --------------------------------------------------------------
DISTRIBUTORS (FOOD & HEALTH)-2.78%
McKesson HBOC, Inc. 165,000 3,722,812
- --------------------------------------------------------------
ELECTRIC COMPANIES-6.85%
Illinova Corp. 82,900 2,880,775
- --------------------------------------------------------------
Niagara Mohawk Holdings Inc.(a) 172,000 2,397,250
- --------------------------------------------------------------
Northeast Utilities 90,300 1,856,794
- --------------------------------------------------------------
Texas Utilities Co. 57,400 2,041,287
- --------------------------------------------------------------
9,176,106
- --------------------------------------------------------------
ELECTRICAL EQUIPMENT-3.81%
Koninklijke (Royal) Philips
Electronics N.V.-ADR
(Netherlands) 31,404 4,239,540
- --------------------------------------------------------------
Sony Corp.-ADR (Japan) 3,000 854,250
- --------------------------------------------------------------
5,093,790
- --------------------------------------------------------------
<PAGE>
ELECTRONICS (COMPONENT
DISTRIBUTORS)-1.63%
Agilent Technologies, Inc.(a) 17,000 1,314,312
- --------------------------------------------------------------
Kyocera Corp.-ADR (Japan) 3,300 864,600
- --------------------------------------------------------------
2,178,912
- --------------------------------------------------------------
ELECTRONICS (SEMICONDUCTORS)-1.72%
Analog Devices, Inc.(a) 24,700 2,297,100
- --------------------------------------------------------------
EQUIPMENT (SEMICONDUCTOR)-3.19%
Novellus Systems, Inc.(a) 34,800 4,264,087
- --------------------------------------------------------------
FINANCIAL (DIVERSIFIED)-4.25%
Citigroup Inc. 57,600 3,200,400
- --------------------------------------------------------------
MGIC Investment Corp. 41,400 2,491,762
- --------------------------------------------------------------
5,692,162
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
HEALTH CARE (DRUGS-MAJOR
PHARMACEUTICALS)-0.74%
Pharmacia & Upjohn, Inc. 22,000 $ 990,000
- --------------------------------------------------------------
HEALTH CARE (HOSPITAL
MANAGEMENT)-5.14%
Health Management Associates,
Inc.-Class A(a) 514,800 6,885,450
- --------------------------------------------------------------
HEALTH CARE (LONG TERM CARE)-2.08%
Manor Care, Inc.(a) 174,100 2,785,600
- --------------------------------------------------------------
HEALTH CARE (MANAGED CARE)-2.90%
United Healthcare Corp. 73,000 3,878,125
- --------------------------------------------------------------
HEALTH CARE (MEDICAL PRODUCTS &
SUPPLIES)-2.63%
Beckman Coulter, Inc. 69,200 3,520,550
- --------------------------------------------------------------
INSURANCE (LIFE/HEALTH)-1.73%
UnumProvident Corp. 72,400 2,321,325
- --------------------------------------------------------------
INSURANCE (PROPERTY-CASUALTY)-5.66%
Radian Group Inc. 64,298 3,070,229
- --------------------------------------------------------------
Travelers Property Casualty
Corp.-Class A 53,800 1,842,650
- --------------------------------------------------------------
XL Capital Ltd.-Class A 51,400 2,666,375
- --------------------------------------------------------------
7,579,254
- --------------------------------------------------------------
<PAGE>
LEISURE TIME (PRODUCTS)-2.34%
Mattel, Inc. 238,660 3,132,412
- --------------------------------------------------------------
MANUFACTURING (SPECIALIZED)-4.55%
Millipore Corp. 73,400 2,835,075
- --------------------------------------------------------------
Parker Hannifin Corp. 63,400 3,253,213
- --------------------------------------------------------------
6,088,288
- --------------------------------------------------------------
METAL FABRICATORS-1.94%
Kennametal Inc. 77,300 2,599,213
- --------------------------------------------------------------
OIL & GAS (DRILLING &
EQUIPMENT)-7.10%
Diamond Offshore Drilling, Inc. 49,800 1,522,013
- --------------------------------------------------------------
ENSCO International Inc. 108,000 2,470,500
- --------------------------------------------------------------
Schlumberger Ltd. 37,700 2,120,625
- --------------------------------------------------------------
Transocean Sedco Forex Inc. 100,714 3,392,796
- --------------------------------------------------------------
9,505,934
- --------------------------------------------------------------
OIL (DOMESTIC INTEGRATED)-1.10%
Atlantic Richfield Co. 17,100 1,479,150
- --------------------------------------------------------------
OIL (INTERNATIONAL
INTEGRATED)-0.98%
Exxon Mobil Corp. 16,353 1,317,439
- --------------------------------------------------------------
PAPER & FOREST PRODUCTS-3.76%
Georgia-Pacific Group 44,700 2,268,525
- --------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
PAPER & FOREST PRODUCTS-(CONTINUED)
International Paper Co. 49,000 $ 2,765,438
- --------------------------------------------------------------
5,033,963
- --------------------------------------------------------------
REAL ESTATE INVESTMENT TRUSTS-1.07%
Starwood Hotels & Resorts
Worldwide, Inc. 60,683 1,426,051
- --------------------------------------------------------------
RETAIL (DEPARTMENT STORES)-3.31%
Federated Department Stores,
Inc.(a) 48,500 2,452,281
- --------------------------------------------------------------
Saks Inc.(a) 127,200 1,979,550
- --------------------------------------------------------------
4,431,831
- --------------------------------------------------------------
RETAIL (FOOD CHAINS)-3.46%
Albertson's, Inc. 74,500 2,402,625
- --------------------------------------------------------------
Kroger Co. (The)(a) 118,100 2,229,138
- --------------------------------------------------------------
4,631,763
- --------------------------------------------------------------
SERVICES (DATA PROCESSING)-2.62%
First Data Corp. 71,000 3,501,188
- --------------------------------------------------------------
TELEPHONE-1.67%
Bell Atlantic Corp. 36,400 2,240,875
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
<S> <C> <C>
WASTE MANAGEMENT-2.33%
Waste Management, Inc. 181,567 $ 3,120,683
- --------------------------------------------------------------
Total Common Stocks & Other
Equity Interests (Cost
$108,033,081) 123,877,517
- --------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
<S> <C> <C>
U.S. TREASURY SECURITIES-0.22%
U.S. TREASURY BILLS-0.22%(B)
5.37%, 03/23/00 (Cost $297,387) $ 301,000(c) 297,659
- --------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SHARES
<S> <C> <C>
MONEY MARKET FUNDS-7.14%
STIC Liquid Assets Portfolio(d) 4,776,360 4,776,360
- --------------------------------------------------------------
STIC Prime Portfolio(d) 4,776,360 4,776,360
- --------------------------------------------------------------
Total Money Market Funds (Cost
$9,552,720) 9,552,720
- --------------------------------------------------------------
TOTAL INVESTMENTS-99.90% (Cost
$117,883,188) 133,727,896
- --------------------------------------------------------------
OTHER ASSETS LESS LIABILITIES-0.10% 137,407
- --------------------------------------------------------------
NET ASSETS-100.00% $133,865,303
- --------------------------------------------------------------
</TABLE>
Investment Abbreviations:
ADR - American Depositary Receipt
Notes to Schedule of Investments:
(a) Non-income producing security.
(b) Interest rate shown represents the rate of discount paid or received at the
time of purchase by the Fund.
(c) A portion of the principal balance was pledged as collateral to cover margin
requirements for open futures contracts. See Note 5.
(d) The money market fund has the same investment advisor as the Fund.
See Notes to Financial Statements.
7
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
December 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $117,883,188) $133,727,896
- ---------------------------------------------------------
Receivables for:
Dividends and interest 178,266
- ---------------------------------------------------------
Variation margin 10,200
- ---------------------------------------------------------
Other assets 4,167
- ---------------------------------------------------------
Total assets 133,920,529
- ---------------------------------------------------------
LIABILITIES:
Accrued advisory fees 50,774
- ---------------------------------------------------------
Accrued custodian fees 4,452
- ---------------------------------------------------------
Total liabilities 55,226
- ---------------------------------------------------------
NET ASSETS APPLICABLE TO BENEFICIAL
INTEREST OUTSTANDING $133,865,303
=========================================================
</TABLE>
STATEMENT OF OPERATIONS
For the year ended December 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of $3,153 foreign withholding
tax) $ 932,561
- ---------------------------------------------------------
Interest 346,034
- ---------------------------------------------------------
Securities lending income 3,427
- ---------------------------------------------------------
Total investment income 1,282,022
- ---------------------------------------------------------
EXPENSES:
Advisory and administrative fees 313,518
- ---------------------------------------------------------
Professional fees 5,531
- ---------------------------------------------------------
Custodian fees 16,536
- ---------------------------------------------------------
Other 6,421
- ---------------------------------------------------------
Total expenses 342,006
- ---------------------------------------------------------
Net investment income 940,016
- ---------------------------------------------------------
<PAGE>
REALIZED AND UNREALIZED GAIN FROM INVESTMENT
SECURITIES AND FUTURES CONTRACTS:
Net realized gain from:
Investment securities 4,400,124
- ---------------------------------------------------------
Futures contracts 276,515
- ---------------------------------------------------------
4,676,639
- ---------------------------------------------------------
Change in net unrealized appreciation of:
Investment securities 12,327,004
- ---------------------------------------------------------
Futures contracts 127,522
- ---------------------------------------------------------
12,454,526
- ---------------------------------------------------------
Net gain from investment securities and
futures contracts 17,131,165
- ---------------------------------------------------------
Net increase in net assets resulting from
operations $18,071,181
=========================================================
</TABLE>
See Notes to Financial Statements.
8
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
For the years ended December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------ -----------
<S> <C> <C>
OPERATIONS:
Net investment income $ 940,016 $ 475,868
- -------------------------------------------------------------------------------------------
Net realized gain from investment securities and futures
and option contracts 4,676,639 44,601
- -------------------------------------------------------------------------------------------
Net change in unrealized appreciation of investment
securities, futures and option contracts 12,454,526 1,516,960
- -------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 18,071,181 2,037,429
- -------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS:
Contributions 96,435,412 500,130
- -------------------------------------------------------------------------------------------
Withdrawals (8,082,448) --
- -------------------------------------------------------------------------------------------
Net increase from beneficial interest transactions 88,352,964 500,130
- -------------------------------------------------------------------------------------------
Total increase in net assets 106,424,145 2,537,559
- -------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of period 27,441,158 24,903,599
- -------------------------------------------------------------------------------------------
End of period $133,865,303 $27,441,158
===========================================================================================
</TABLE>
See Notes to Financial Statements.
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES
The Value Portfolio (the "Portfolio") is organized as a Delaware business trust
which is registered under the 1940 Act as an open-end management investment
company.
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 the significant accounting policies followed by the
Portfolio in the preparation of their financial statements.
A. Security Valuations -- A security listed or traded on an exchange (except
convertible bonds) is valued at its last sales price on the exchange where
the security is principally traded, or lacking any sales on a particular
day, the security is valued at the closing bid price on that day. Each
security reported on the NASDAQ National Market System is valued at the last
sales price on the valuation date or absent a last sales price, at the
closing bid price. Debt obligations (including convertible bonds) are valued
on the basis of prices provided by an independent pricing service. Prices
provided by the 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 prices are
not provided by any of the above methods are valued based upon quotes
furnished by independent sources and are valued at the last bid price in the
case of equity securities and in the case of debt obligations, the mean
between the last bid and asked prices. Securities for which market
quotations are not readily available or are questionable are valued at fair
value as determined in good faith by or under the supervision of the Trust's
and Portfolio's officers in a manner specifically authorized by the Boards
of Trustees. Short-term obligations having 60 days or less to maturity are
valued at amortized cost which approximates market value. For purposes of
determining net asset value per share, futures and option contracts
generally will be valued 15 minutes after the close of trading of the New
York Stock Exchange ("NYSE").
Generally, trading in foreign securities is substantially completed each
day at various times prior to the close of the NYSE. The values of such
securities are determined as of such times. Foreign currency exchange rates
are also generally determined prior to the close of the NYSE. 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
NYSE which would not be reflected. 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 Boards of Trustees.
B. Securities Transactions and Investment Income -- Securities transactions are
accounted for on a trade date basis. Realized gains or losses on sales 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 the accrual basis.
C. Federal Income Taxes -- The Portfolio 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.
D. Foreign Currency Contracts -- The Portfolio may purchase or sell 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 Portfolio'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 Portfolio recognizes a realized gain or loss equal to the
difference between the proceeds from, or cost of, the closing transaction
and the Portfolio's basis in the contract. Risks include the possibility of
an illiquid market and that a change in value of the contracts may not
correlate with changes in the value of the securities being hedged.
<PAGE>
NOTE 2-ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A I M Advisors, Inc. ("AIM") is the Portfolio's investment manager and
administrator. The Portfolio pays AIM investment management and administration
fees at an annual rate of 0.475% on the first $500 million of the Portfolio's
average daily net assets, plus 0.45% on the next $500 million of the Portfolio's
average daily net assets, plus 0.425% on the next $500 million of the
Portfolio's average daily net assets, plus 0.40% on the Portfolio's average
daily net assets exceeding $1.5 billion.
NOTE 3-BANK BORROWINGS
The Portfolio 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) $1,000,000,000 or (ii) the limits set by its prospectus for
borrowings. The Portfolio and other funds advised by AIM which are parties to
the line of credit may borrow on a first come, first served basis. During the
year ended December 31, 1999, the Portfolio did not borrow under the line of
credit agreement. The funds which are party to the line of credit are charged a
commitment fee of 0.09% on the unused balance of the committed line. The
commitment fee is allocated among the funds based on their respective average
net
10
<PAGE>
assets for the period. Prior to May 28, 1999, the Portfolio, along with certain
other funds advised and/or administered by AIM, had a line of credit with
BankBoston and State Street Bank & Trust Company. The arrangements with the
banks allowed the Portfolio and certain other funds to borrow, on a first come,
first served basis, an aggregate maximum amount of $250,000,000.
NOTE 4-PORTFOLIO SECURITIES LOANED
At December 31, 1999, securities with an aggregate value of $2,912,369 were on
loan to brokers. The loans were secured by cash collateral of $2,970,631
received by the Portfolio. For the year ended December 31, 1999, the Portfolio
received fees of $3,427 for securities lending.
For international securities, cash collateral is received by the portfolio
against loaned securities in an amount at least equal to 105% of the market
value of the loaned securities at the inception of each loan. The collateral
must be maintained at not less than 103% of the market value of the loaned
securities during the period of the loan. For domestic securities, cash
collateral is received by the portfolio against loaned securities in the amount
at least equal to 102% of the market value of the loaned securities at the
inception of each loan. This collateral must be maintained at not less than 100%
of the market value of the loaned securities during the period of the loan. The
cash collateral is invested in a securities lending trust which consists of a
portfolio of high quality short duration securities whose average effective
duration is restricted to 120 days or less.
NOTE 5-FUTURES CONTRACTS
On December 31, 1999, $250,000 principal amount of U.S. Treasury obligations
were pledged as collateral to cover margin requirements for open futures
contracts. Open futures contracts were as follows:
<TABLE>
<CAPTION>
VALUE OF
NO. OF MONTH/ OPEN FUTURES UNREALIZED
CONTRACT CONTRACTS COMMITMENT CONTRACTS APPRECIATION
- --------------------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
S&P 500 Index 12 Mar. 00/Buy $4,452,600 $127,522
- -----------------------------------------------------------------------------
</TABLE>
NOTE 6-INVESTMENT SECURITIES
The aggregate amount of investment securities (other than short-term securities)
purchased and sold by the Portfolio during the year ended December 31, 1999 was
$118,370,194 and $36,601,100, respectively.
The amount of unrealized appreciation (depreciation) of investment securities,
for tax purposes, as of December 31, 1999 was as follows:
<TABLE>
<S> <C>
Aggregate unrealized appreciation of
investment securities $20,307,083
- ---------------------------------------------------------
Aggregate unrealized (depreciation) of
investment securities (5,008,971)
- ---------------------------------------------------------
Net unrealized appreciation of investment
securities $15,298,112
=========================================================
</TABLE>
Cost of investments for tax purposes is $118,429,784.
<PAGE>
NOTE 7-SUPPLEMENTAL DATA
Contained below are ratios and supplemental data that have been derived from
information provided in the financial statements.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------
1999 1998 1997 1996 1995
-------- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
RATIOS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) $133,865 $27,441 $24,904 $8,316 $1,879
======================================================== ======== ======= ======= ====== =======
Ratio of expenses to average net assets:
With expense waivers and/or reimbursement 0.51% 0.29% 0.67% 1.06% 4.33%(a)
======================================================== ======== ======= ======= ====== =======
Without expense waivers and/or reimbursement 0.51% 0.51% 0.68% 1.06% 4.33%(a)
======================================================== ======== ======= ======= ====== =======
Ratio of net investment income to average net assets:
With expense waivers and/or reimbursement 1.40% 1.70% 1.90% 0.88% (1.04)%(a)
======================================================== ======== ======= ======= ====== =======
Without expense waivers and/or reimbursement 1.40% 1.48% 1.89% 0.88% (1.04)%(a)
======================================================== ======== ======= ======= ====== =======
Ratio of interest expense to average net assets -- -- 0.03% -- --
======================================================== ======== ======= ======= ====== =======
Portfolio turnover rate 63% 148% 93% 256% --
======================================================== ======== ======= ======= ====== =======
</TABLE>
(a) Annualized.
11
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of AIM Growth Series and Shareholders of
AIM Basic Value Portfolio:
In our opinion, the accompanying statement of assets and
liabilities, including the schedule of investments, and
the related statements of operations and of changes in
net assets and the financial highlights present fairly,
in all material respects, the financial position of AIM
Basic Value Portfolio (hereafter referred to as the
"Portfolio") at December 31, 1999, the results of its
operations, the changes in its net assets and the
supplemental data for each of the periods indicated
therein, in conformity with accounting principles
generally accepted in the United States. These financial
statements and supplemental data (hereafter referred to
as "financial statements") are the responsibility of the
Portfolio's management; our responsibility is to express
an opinion on these financial statements based on our
audits. We conducted our audits of these financial
statements in accordance with auditing standards
generally accepted in the United States which require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the
accounting principles used and significant estimates made
by management, and evaluating the overall financial
statement presentation. We believe that our audits, which
included confirmation of securities at December 31, 1999
by correspondence with the custodian and brokers, provide
a reasonable basis for the opinion expressed above.
PRICEWATERHOUSECOOPERS LLP
Boston, Massachusetts
February 16, 2000
12
<PAGE>
PART C: OTHER INFORMATION
GROWTH PORTFOLIO
Item 23. Exhibits.
- -------------------
Exhibit
Number Description
- ------- -----------
(a) - Agreement and Declaration of Trust of Registrant, dated May 7, 1998,
was filed as an Exhibit to Amendment No. 5 to the Registration
Statement on Form N-1A, on April 30, 1999, and is hereby
incorporated by reference.
(b) (1) - Amended and Restated Bylaws of Registrant were filed as an Exhibit
to Amendment No. 5 to the Registration Statement on Form N-1A, on
April 30, 1999, and is hereby incorporated by reference.
(2) - First Amendment to Amended and Restated Bylaws of Growth Portfolio,
adopted June 15, 1999, is filed herewith electronically.
(c) - Provisions of instruments defining the rights of holders of
Registrant's securities are contained in the Agreement and
Declaration of Trust, as amended, Articles II, VI, VII, VIII and IX
and Bylaws Articles IV, V, VI, VII and VIII, which were included as
part of Exhibits (a) and (b) to Amendment No. 5 to the Registration
Statement on Form N-1A, on April 30, 1999, and is hereby
incorporated by reference.
(d) - Investment Management and Administration Contract, dated May 29,
1998, between Registrant and A I M Advisors, Inc. was filed as an
Exhibit to Amendment No. 4 to the Registration Statement on Form
N-1A, on June 23, 1998, and is hereby incorporated by reference.
(e) - Underwriting Contracts - None.
(f) - Bonus or Profit Sharing Contracts - None.
(g) (1) - Custodian Contract, dated August 1, 1995, between Registrant and
State Street Bank and Trust Company, was filed as an Exhibit to the
Registration Statement on Form N-1A, on October 17, 1995, and is
hereby incorporated by reference.
(2) - Amendment to Custodian Contract, dated January 26, 1999, was filed
as an Exhibit to Amendment No. 5 to the Registration Statement on
Form N-1A, on April 30, 1999, and is hereby incorporated by
reference.
(h) - Other Material Contracts - None.
(i) - Legal Opinion - None.
C-1
<PAGE>
(j) - Consent of PricewaterhouseCoopers LLP, independent auditors, is
filed herewith electronically.
(k) - Omitted Financial Statements - None.
(l) - Initial Capitalization Agreements - None.
(m) - Rule 12b-1 Plan - None.
(n) - Rule 18f-3 Plan - None.
(o) - Reserved
(p) - The Code of Ethics for the Registrant, dated March 14, 2000, is
filed herewith electronically.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND.
- ----------------------------------------------------------------------
PROVIDE A LIST OR DIAGRAM OF ALL PERSONS DIRECTLY OR INDIRECTLY
CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND. FOR ANY PERSON CONTROLLED
BY ANOTHER PERSON, DISCLOSE THE PERCENTAGE OF VOTING SECURITIES OWNED BY THE
IMMEDIATELY CONTROLLING PERSON OR OTHER BASIS OF THAT PERSON'S CONTROL. FOR EACH
COMPANY, ALSO PROVIDE THE STATE OR OTHER SOVEREIGN POWER UNDER THE LAWS OF WHICH
THE COMPANY IS ORGANIZED.
None.
ITEM 25. INDEMNIFICATION.
- --------------------------
STATE THE GENERAL EFFECT OF ANY CONTRACT, ARRANGEMENTS OR STATUTE UNDER
WHICH ANY DIRECTOR, OFFICER, UNDERWRITER OR AFFILIATED PERSON OF THE FUND IS
INSURED OR INDEMNIFIED AGAINST ANY LIABILITY INCURRED IN THEIR OFFICIAL
CAPACITY, OTHER THAN INSURANCE PROVIDED BY ANY DIRECTOR, OFFICER, AFFILIATED
PERSON, OR UNDERWRITER FOR THEIR OWN PROTECTION.
Article IX of the Registrant's Agreement and Declaration of
Trust provides for indemnification of certain persons acting
on behalf of the Registrant. Article VIII, Section 9.1
provides that a Trustee, when acting in such capacity, shall
not be personally liable to any person for any act,
omission, or obligation of the Registrant or any Trustee;
provided, however, that nothing contained in the
Registrant's Agreement and Declaration of Trust or in the
Delaware Business Trust Act shall protect any Trustee
against any liability to the Registrant or the Shareholders
to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless
disregard of the duties involved in the conduct of the
office of Trustee.
C-2
<PAGE>
Article VI, Section 3 of the Registrant's Amended and
Restated Bylaws also provides that every person who is, or
has been, a Trustee or officer of the Registrant to the
fullest extent permitted by the Delaware Business Trust Act,
the Registrant's Amended and Restated Bylaws and other
applicable law.
Section 9 of the Investment Management and Administration
Contract between the Registrant and AIM provides that AIM
shall not be liable, and each series of the Registrant shall
indemnify AIM and its directors, officers and employees, for
any costs or liabilities arising from any error of judgment
or mistake of law or any loss suffered by any series of the
Registrant or the Registrant in connection with the matters
to which the Investment Management and Administration
Contract relates except a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of
AIM in the performance by AIM of its duties or from reckless
disregard by AIM of its obligations and duties under the
Investment Management and Administration Contract.
ITEM 26. BUSINESS AND OTHER CONNECTIONS OF THE INVESTMENT ADVISOR.
- -------------------------------------------------------------------
DESCRIBE ANY OTHER BUSINESS, PROFESSION, VOCATION OR EMPLOYMENT OF A
SUBSTANTIAL NATURE THAT EACH INVESTMENT ADVISOR, AND EACH DIRECTOR, OFFICER OR
PARTNER OF THE ADVISOR, IS OR HAS BEEN ENGAGED WITHIN THE LAST TWO FISCAL YEARS
FOR HIS OR HER OWN ACCOUNT OR IN THE CAPACITY OF DIRECTOR, OFFICER, EMPLOYEE,
PARTNER, OR TRUSTEE.
See the material under the headings "Trustees and Executive Officers"
and "Management" included in Part B (Statement of Additional
Information) of this Amendment. Information as to the directors and
officers of A I M Advisors, Inc. is included in Schedule A and Schedule
D of Part I of its Form ADV (File No. 801-12313), filed with the
Securities and Exchange Commission, which is incorporated herein by
reference thereto.
ITEM 27. PRINCIPAL UNDERWRITERS.
- --------------------------------
None.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS.
- -------------------------------------------
STATE THE NAME AND ADDRESS OF EACH PERSON MAINTAINING PHYSICAL
POSSESSIONS OF EACH ACCOUNT, BOOK, OR OTHER DOCUMENT REQUIRED TO BE MAINTAINED
BY SECTION 31(A) [15 U.S.C. 80A-30(A)] AND THE RULES UNDER THAT SECTION.
Accounts, books and other records required by Rules 31a-1 and 31a-2
under the Investment Company Act of 1940, as amended, are maintained
and held in the offices of the Registrant and its advisor, A I M
C-3
<PAGE>
Advisors, Inc., 11 Greenway Plaza, Suite 100, Houston, Texas 77046, and
its custodian, State Street Bank and Trust Company, 225 Franklin
Street, Boston, Massachusetts 02110.
ITEM 29. MANAGEMENT SERVICES.
- ------------------------------
Provide a summary of the substantive provisions of any
management-related service contract not discussed in Part A or B, disclosing the
parties to the contract and the total amount paid and by whom for the Fund's
last three fiscal years.
None.
ITEM 30. UNDERTAKINGS.
- -----------------------
None.
C-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Investment Company Act of 1940, the
Growth Portfolio has duly caused this Registration Statement on Form N-1A to be
signed on its behalf by the undersigned, thereunto duly authorized, in the city
of Houston and the State of Texas on the 28th day of April, 2000.
GROWTH PORTFOLIO
By: /s/ Robert H. Graham
------------------------------
Robert H. Graham, President
SIGNATURES TITLE DATE
---------- ----- ----
/s/ Robert H. Graham Chairman, Trustee & President April 28, 2000
--------------------
/s/ C. Derek Anderson Trustee April 28, 2000
----------------------
/s/ Frank S. Bayley Trustee April 28, 2000
-------------------
/s/ Ruth H. Quigley Trustee April 28, 2000
-------------------
/s/ Dana R. Sutton Vice President & Treasurer April 28, 2000
------------------ (Principal Financial and
(Dana R. Sutton) Accounting Officer)
<PAGE>
INDEX TO EXHIBITS
GROWTH PORTFOLIO
Exhibit Number
- --------------
23 (b) (2) First Amendment to Amended and Restated Bylaws of Growth Portfolio,
adopted June 15, 1999.
23 (j) Consent of PricewaterhouseCoopers LLP, independent auditors
23 (p) The Code of Ethics for the Registrant
FIRST AMENDMENT TO AMENDED AND RESTATED
BYLAWS OF GROWTH PORTFOLIO
(A DELAWARE BUSINESS TRUST)
ADOPTED JUNE 15, 1999
The Bylaws of Growth Portfolio are hereby amended as follows:
WHEREAS, the Board of Trustees of the Fund desires to modify the manner in which
a chairman is appointed to preside at each shareholder meeting;
NOW THEREFORE BE IT RESOLVED, that paragraph (a) of Article IV, Section 9 of
each Fund's Bylaws be, and it hereby is, amended by deleting paragraph (a) of
Article IV, Section 9 in its entirety and replacing it with the following:
Section 9. Organization of Meetings.
(a) The meetings of the Holders shall be presided over by
the Chairman of the Board, or if the Chairman shall not be present or
if there is no Chairman, by the President, or if the President shall
not be present, by a Vice President, or if no Vice President is
present, by a chairman appointed for such purpose by the Board of
Trustees or, if not so appointed, by a chairman appointed for such
purpose by the officers and Trustees present at the meeting. The
Secretary of the Trust, if present, shall act as Secretary of such
meetings, or if the Secretary is not present, an Assistant Secretary
of the Trust shall so act, and if no Assistant Secretary is present,
then a person designated by the Secretary of the Trust shall so act,
and if the Secretary has not designated a person, then the meeting
shall elect a secretary for the meeting.
Consent of Independent Accountants
To the Trustees of Growth Portfolio:
RE: Small Cap Portfolio
Value Portfolio
(the "Portfolios")
AIM Small Cap Growth Fund
AIM Basic Value Fund
(the "Funds")
We hereby consent to the inclusion in Amendment No. 6 to the Registration
Statement on Form N-1A, under the Investment Company Act of 1940, as amended, of
the Growth Portfolio (the "Portfolios"), of our reports dated February 16, 2000,
on our audits of the financial statements and supplemental data of the
Portfolios. We also consent to the reference to our Firm under the caption
"Financial Statements" in this registration.
PricewaterhouseCoopers LLP
Boston, Massachusetts
April 27, 2000
CODE OF ETHICS
OF
GROWTH PORTFOLIO
WHEREAS, Growth Portfolio (the "Company") is a registered investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and
WHEREAS, Rule 17j-1 under the 1940 Act requires the Company to adopt a
Code of Ethics ("the Code"); and NOW, THEREFORE, the Company hereby
adopts the following Code, effective as of March 14, 2000.
I. DEFINITIONS
For the purpose of the Code the following terms shall have the meanings
set forth below:
A. "Access person" means any director, trustee, officer, or advisory
person of the Company; provided, however, that any person who is an
access person of any investment advisor of, or principal
underwriter for, any registered investment company and who is
required by Rule 17j-1 of the 1940 Act to report his or her
securities transactions to such investment advisor or principal
underwriter, shall not be deemed an access person of the Company.
B. "Advisory person" means
1. any employee of the Company, its investment advisor or
administrator (or of any entity in a control relationship with
the Company, its investment advisor or administrator, as defined
in Section I.D. hereof), who, in connection with his or her
regular functions or duties, makes, participates in, or obtains
information (other than publicly available information)
regarding the purchase or sale of a security by the Company, or
whose functions relate to the making of any recommendations with
respect to such purchases or sales; and
2. any natural person directly or indirectly owning, controlling,
or holding with power to vote, 25% or more of the outstanding
voting securities of any of the Company, its investment advisor
or administrator, who obtains information (other than publicly
available information) concerning recommendations made by the
Company, its investment advisor or administrator with regard to
the purchase or sale of a security.
C. "Affiliated persons" or "Affiliates" means
1. any employee or access person of the Company, and any member of
the immediate family (defined as spouse, child, mother, father,
brother, sister, in-law or any other relative) of any such
person who lives in the same household as such person or who is
financially dependent upon such person;
2. any account for which any of the persons described in Section
I.C.1. hereof is a custodian, trustee or otherwise acting in a
fiduciary capacity, or with respect to which any such person
either has the authority to make investment decisions or from
time to time give investment advice; and
3. any partnership, corporation, joint venture, trust or other
entity in which any employee of the Company or access person of
the Company directly or indirectly, in the aggregate, has a 10%
or more beneficial interest or for which any such person is a
general partner or an executive officer.
D. "Control" means the power to exercise a controlling influence over
the management or policies of a corporation. Any person who owns
<PAGE>
beneficially, either directly or through one or more controlled
corporations, more than 25% of the voting securities of a corporation
shall be presumed to control such corporation.
E. "Security" means any note, stock, treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in
any profit-sharing agreement, collateral-trust certificate,
pre-organization certificate or subscription, transferable share,
investment contract, voting-trust certificate, certificate of deposit
for a security, fractional undivided interest in oil, gas, or other
mineral rights, or, in general, any interest or instrument commonly
known as a "security", or any certificate of interest or
participation in, temporary or interim certificate for, receipt of,
guarantee of, or warrant or right to subscribe to or purchase, any of
the foregoing; provided, however, that "security" shall not mean
securities issued or guaranteed by the Government of the United
States, its agencies or instrumentalities, bankers' acceptances, bank
certificates of deposit, commercial paper and shares of registered
open-end investment companies.
F. "Purchase or sale of a security" includes the writing of an option to
purchase or sell a security.
G. "Security held or to be acquired" by the Company means any security
that, within the most recent fifteen (15) days:
1. is or has been held by the Company, or
2. is being or has been considered by the Company for purchase by the
Company.
H. "Beneficial ownership of a security" by any person includes
securities held by:
1. a spouse, minor children or relatives who share the same home with
such person;
2. an estate for such person's benefit;
3. a trust, of which
a. such person is a trustee or such person or members of such
person's immediate family have a vested interest in the income
or corpus of the trust, or
b. such person owns a vested beneficial interest, or
c. such person is the settlor and such person has the power to
revoke the trust without the consent of all the beneficiaries;
4. a partnership in which such person is a partner;
5. a corporation (other than with respect to treasury shares of the
corporation) of which such person is an officer, director or 10%
stockholder;
6. any other person if, by reason of contract, understanding,
relationship, agreement or other arrangement, such person obtains
therefrom benefits substantially equivalent to those of
ownership; or
7. such person's spouse or minor children or any other person, if,
even though such person does not obtain therefrom the
above-mentioned benefits of ownership, such person can vest or
re-vest title in himself at once or at some future time.
A beneficial owner of a security also includes any person who,
directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares voting power
and/or investment power with respect to such security. Voting power
includes the power to vote, or to direct the voting of such security,
and investment power includes the power to dispose, or to direct the
disposition of such security. A person is the beneficial owner of a
security if he has the right to acquire beneficial ownership of such
security at any time within sixty (60) days.
-2-
<PAGE>
II. IDENTIFICATION OF ACCESS PERSONS
A. The Company will maintain a list of all access persons and
will notify each access person in writing that such person
is an access person. Once a person has been so identified,
he/she shall continue to be an access person until
otherwise notified in writing by the Company; provided,
however, if such person is an access person solely because
he/she is a director/trustee of the Company, such person
shall cease to be an access person at the time such person
ceases to be a director/trustee.
B. Each access person will be given a copy of the Code at the time such
person becomes an access person.
III. COMPLIANCE WITH GOVERNING LAWS, REGULATIONS AND PROCEDURES
A. Each access person shall comply strictly with all applicable federal
and state laws and all rules and regulations of any governmental
agency or self-regulatory organization governing his or her
activities.
B. Each access person shall comply strictly with procedures established
by the Company to ensure compliance with applicable federal and state
laws and regulations of governmental agencies and self-regulatory
organizations.
C. Access persons shall not knowingly participate in, assist, or condone
any acts in violation of any statute or regulation governing
securities matters, nor any act that would violate any provision of
this Code or any rules adopted thereunder.
IV. CONFIDENTIALITY OF TRANSACTIONS
A. Information relating to the Company's portfolio and research and
studies activities is confidential until publicly available. Whenever
statistical information or research is supplied to or requested by
the Company, such information must not be disclosed to any persons
other than as duly authorized by the President or the Board of
Directors/Trustees of the Company. If the Company is considering a
particular purchase or sale of a security, this must not be disclosed
except to such duly authorized persons.
B. If any access person should obtain information concerning the
Company's portfolio (including the consideration by the Company of
acquiring or recommending any security for the Company's portfolio),
whether in the course of such person's duties or otherwise, such
person shall respect the confidential nature of this information and
shall not divulge it to anyone unless it is properly part of such
person's services to the Company to do so or such person is
specifically authorized to do so by the President of the Company.
V. ETHICAL STANDARDS
A. Access persons shall conduct themselves in a manner consistent with
the highest ethical standards. They shall avoid any action, whether
for personal profit or otherwise, that results in an actual or
potential conflict of interest, or the appearance of a conflict of
interest, with the Company or which may be otherwise detrimental to
the interests of the Company.
B. Conflicts of interest generally result from a situation in which an
individual has personal interests in a matter that is or may be
competitive with his responsibilities to another person or entity
(such as the Company) or where an individual has or may have
competing obligations or responsibilities to two or more persons or
entities. In the case of the relationship between the Company on the
one hand, and its employees and access persons and their respective
affiliates on the other hand, such conflicts may result from the
purchase or sale of securities for the account of the Company and for
the personal account of the individual involved or the account of any
-3-
<PAGE>
affiliate of such person. Such conflict may also arise from the
purchase or sale for the account of the Company of securities in
which an access person or employee of the Company (or an affiliate of
such person) has an interest. In any such case, potential or actual
conflicts must be disclosed to the Company, and the first preference
and priority must be to avoid such conflicts of interest wherever
possible and, where they unavoidably occur, to resolve them in a
manner not disadvantageous to the Company.
VI. ACTIVITIES AND TRANSACTIONS OF ACCESS PERSONS
A. No access person shall recommend to, or cause or attempt to cause,
the Company to acquire, dispose of, or hold any security (including,
any option, warrant or other right or interest relating to such
security) which such access person or an affiliate of such access
person has direct or indirect beneficial ownership, unless the access
person shall first disclose to the Board of Directors/Trustees all
facts reasonably necessary to identify the nature of the ownership of
such access person or his or her affiliate in such security.
B. No access person or affiliate of such access person shall engage in a
purchase or sale of a security (including, any option, warrant or
other right or interest relating to such security), other than on
behalf of the Company, with respect to any security, which, to the
actual knowledge of such access person at the time of such purchase
or sale, is (i) being considered for purchase or sale by the Company;
or (ii) being purchased or sold by the Company.
C. The prohibitions of Section VI.B. above shall not apply to:
1. Purchases or sales effected in any account over which the access
person has no direct or indirect influence or control.
2. Purchases or sales which are non-volitional on the part of
either the access person or the Company.
3. Purchases that are part of an automatic dividend reinvestment
plan.
4. Purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of its securities, to
the extent such rights were acquired from such issuer, and sales
of such rights so acquired.
5. Purchases or sales which receive the prior approval of the
President of the Company because they are only remotely
potentially harmful to the Company because they would be very
unlikely to affect trading in or the market value of the
security, or because they clearly are not related economically
to the securities to be purchased, sold or held by the Company.
D. If, in compliance with the limitations and procedures set forth in
this Section VI, any access person or an affiliate of such person
shall engage in a purchase or sale of a security held or to be
acquired by the Company, first preference and priority must be given
to any transactions that involve the Company, and the Company must
have the benefit of the best price obtainable on acquisition and the
best price obtainable on disposition of such securities.
E. If, as a result of fiduciary obligations to other persons or
entities, an access person believes that such person or an affiliate
of such person is unable to comply with certain provisions of the
Code, such access person shall so advise the Board of
Directors/Trustees in writing, setting forth with reasonable
specificity the nature of such fiduciary obligations and the reasons
why such access person believes such person is unable to comply with
any such provisions. The Board of Directors/Trustees may, in its
discretion, exempt such access person or an affiliate of such person
from any such provisions, if the Board of Directors/Trustees shall
determine that the services of such access person are valuable to the
Company and the failure to grant such exemption is likely to cause
such access person to be unable to render services to the Company.
Any access person granted an exemption (including, an exception for
-4-
<PAGE>
an affiliate of such person) pursuant to this Section VI.E. shall,
within three business days after engaging in a purchase or sale of a
security held or to be acquired by a client, furnish the Board of
Directors/Trustees with a written report concerning such transaction,
setting forth the information specified in Section VII.B. hereof.
VII. Reporting Procedures
A. Except as provided by Sections VII.C. and VII.D. hereof, every access
person shall report to the Board of Directors/Trustees the
information described in Section VII.B. hereof with respect to
transactions in any security in which such access person has, or by
reason of such transaction acquires, any direct or indirect
beneficial ownership in the security (whether or not such security is
a security held or to be acquired by a client); provided, however,
that any such report may contain a statement that the report shall
not be construed as an admission by the person making such report
that he has any direct or indirect beneficial ownership in the
security to which the report relates.
B. Every report required to be made pursuant to Section VII.A. hereof
shall be made not later than ten days after the end of the calendar
quarter in which the transaction to which the report relates was
effected and shall contain the following information:
1. The date of the transaction, the title and the number of shares,
and the principal amount of each security involved;
2. The nature of the transaction (i.e., purchase, sale or any other
type of acquisition or disposition);
3. The price at which the transaction was effected; and
4. The name of the broker, dealer or bank with or through whom the
transaction was effected.
C. Notwithstanding the provisions of Section VII.A. and VII.B. hereof,
no person shall be required to make a report with respect to
transactions effected for any account over which such person does not
have any direct or indirect influence or control.
D. Notwithstanding the provisions of Section VII.A. and VII.B. hereof,
an access person who is not an "interested person" of the Company
within the meaning of Section 2(a)(19) of the 1940 Act, and who would
be required to make a report solely by reason of being a
director/trustee of the Company, need only report a transaction in a
security if such director/trustee, at the time of the transaction,
knew or, in the ordinary course of fulfilling his official duties as
a director/trustee of the Company, should have known, that, during
the 15-day period immediately preceding or after the date of the
transaction by the director/trustee, such security is or was
purchased or sold, or considered by the Company or its investment
advisor for purchase or sale by the Company.
E. Every access person who beneficially owns, directly or indirectly,
1/2% or more of the stock of any company the securities of which are
eligible for purchase by the Company shall report such holdings to
the Company.
VIII. Review Procedures
A. The reports submitted by access persons pursuant to Section VII.B.
hereof shall be reviewed at least quarterly by the Board of
Directors/Trustees or such other persons or committees as shall be
designated by the Board of Directors/Trustees, in order to monitor
compliance with this Code.
-5-
<PAGE>
B. If it is determined by the Board of Directors/Trustees that a
violation of this Code has occurred and that the person violating
this Code has purchased or sold a security at a more advantageous
price than that obtained by the Company, such person shall be
required to offer to sell to or purchase from the Company, as the
case may be, such security at the more advantageous price. If this
cannot be consummated, then the Board of Directors/Trustees shall
take such other course of action as it may deem appropriate. With
respect to any violation of this Code, the Board of
Directors/Trustees may take any preventive, remedial or other action
that it may deem appropriate. In determining whether or not there has
been, or may be, a conflict of interest between the Company and any
person subject to this Code, the Board of Directors/Trustees shall
consider all of the relevant facts and circumstances.
-6-
