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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-05845
Invesco Senior Loan Fund
(Exact name of registrant as specified in charter)
1555 Peachtree Street, N.E., Suite 1800 Atlanta, Georgia 30309
(Address of principal executive offices) (Zip code)
Sheri Morris 1555 Peachtree Street, N.E., Suite 1800 Atlanta, Georgia 30309
(Name and address of agent for service)
Registrant’s telephone number, including area code: (713) 626-1919
Date of fiscal year end: 2/28
Date of reporting period: 2/28/18
Item 1. Report to Stockholders.
| | | | | | |
| | | |
 | | Annual Report to Shareholders | | | February 28, 2018 | |
| | | |
| | Invesco Senior Loan Fund | |
| | Nasdaq: | |
| | A: VSLAX ∎ C: VSLCX ∎ Y: VSLYX ∎ IB: XPRTX ∎ IC: XSLCX | |
Letters to Shareholders
| | |
 | | Dear Shareholders: This annual report includes information about your Fund, including performance data and a complete list of its investments as of the close of the reporting period. Inside is a discussion of how your Fund was managed and the factors that affected its performance during the reporting period. For much of the reporting period, major US stock market indexes rose to record highs – but in early 2018, volatility returned to the US stock and bond markets. Investors worried about how rising interest rates might affect economic growth; those concerns caused the US stock market, which many investors believed had risen too far, too fast, to pull back. Throughout the reporting period, economic data remained generally positive, corporate earnings remained strong and consumer sentiment remained positive, particularly after passage of legislation cutting personal and corporate tax rates in December. The US economy expanded throughout the reporting period, and the first signs of rising inflation appeared. In response, the US Federal Reserve raised |
| interest rates three times, and the tone of its statements grew more hawkish regarding potential rate increases in 2018. Overseas, economic data were mixed, prompting the European Central Bank and central banks in China and Japan, among other countries, to maintain extraordinarily accommodative monetary policies. |
Short-term market volatility can prompt some investors to abandon their investment plans – and can cause others to settle for whatever returns the market has to offer. The investment professionals at Invesco, in contrast, invest with high conviction. This means that, no matter the asset class or the strategy, each investment team has a passion to exceed. We want to help investors achieve better outcomes, such as seeking higher returns, helping mitigate risk and generating income. Of course, investing with high conviction can’t guarantee a profit or ensure success; no investment strategy can. To learn more about how we invest with high conviction, visit invesco.com/HighConviction. |
You, too, can invest with high conviction by maintaining a long-term investment perspective and by working with your financial adviser on a regular basis. During periods of short-term market volatility or uncertainty, your financial adviser can keep you focused on your long-term investment goals – a new home, a child’s college education or a secure retirement. He or she also can share research about the economy, the markets and individual investment options. |
Visit our website for more information on your investments |
Our website, invesco.com/us, offers a wide range of market insights and investment perspectives. On the website, you’ll find detailed information about our funds, including performance, holdings and portfolio manager commentaries. You can access information about your account by completing a simple, secure online registration. To do so, select “Log In” on the right side of the homepage, and then select “Register for Individual Account Access.” In addition to the resources accessible on our website and through our mobile app, you can obtain timely updates to help you stay informed about the markets and the economy by connecting with Invesco on Twitter, LinkedIn or Facebook. You can access our blog at blog.invesco.us.com. Our goal is to provide you the information you want, when and where you want it. Finally, I’m pleased to share with you Invesco’s commitment to both the Principles for Responsible Investment and to considering environmental, social and governance issues in our robust investment process. I invite you to learn more at invesco.com/esg. |
Have questions? |
For questions about your account, contact an Invesco client services representative at 800 959 4246. All of us at Invesco look forward to serving your investment management needs. Thank you for investing with us. |
Sincerely,
Philip Taylor
Senior Managing Director, Invesco Ltd.
2 Invesco Senior Loan Fund
| | |
 | | Dear Fellow Shareholders: Among the many important lessons I’ve learned in more than 40 years in a variety of business endeavors is the value of a trusted advocate. As independent chair of the Invesco Funds Board, I can assure you that the members of the Board are strong advocates for the interests of investors in Invesco’s mutual funds. We work hard to represent your interests through oversight of the quality of the investment management services your funds receive and other matters important to your investment, including but not limited to: ∎ Ensuring that Invesco offers a diverse lineup of mutual funds that your financial adviser can use to strive to meet your financial needs as your investment goals change over time. ∎ Monitoring how the portfolio management teams of the Invesco funds are performing in light of changing economic and market conditions. |
∎ Assessing each portfolio management team’s investment performance within the context of the investment strategy described in the fund’s prospectus.
∎ Monitoring for potential conflicts of interests that may impact the nature of the services that your funds receive.
We believe one of the most important services we provide our fund shareholders is the annual review of the funds’ advisory and sub-advisory contracts with Invesco Advisers and its affiliates. This review is required by the Investment Company Act of 1940 and focuses on the nature and quality of the services Invesco provides as the adviser to the Invesco funds and the reasonableness of the fees that it charges for those services. Each year, we spend months carefully reviewing information received from Invesco and a variety of independent sources, such as performance and fee data prepared by Lipper, Inc. (a subsidiary of Broadridge Financial Solutions, Inc.), an independent, third-party firm widely recognized as a leader in its field. We also meet with our independent legal counsel and other independent advisers to review and help us assess the information that we have received. Our goal is to assure that you receive quality investment management services for a reasonable fee.
I trust the measures outlined above provide assurance that you have a worthy advocate when it comes to choosing the Invesco Funds.
As always, please contact me at bruce@brucecrockett.com with any questions or concerns you may have. On behalf of the Board, we look forward to continuing to represent your interests and serving your needs.
Sincerely,
Bruce L. Crockett
Independent Chair
Invesco Funds Board of Trustees
3 Invesco Senior Loan Fund
Management’s Discussion of Fund Performance
| | |
Performance summary |
For the fiscal year ended February 28, 2018, Class A shares of Invesco Senior Loan Fund (the Fund), at net asset value (NAV), outperformed the Fund’s benchmark, the Credit Suisse Leveraged Loan Index. Your Fund’s long-term performance appears later in this report. |
Fund vs. Indexes |
Total returns, 2/28/17 to 2/28/18, at net asset value (NAV). Performance shown does not include applicable contingent deferred sales charges (CDSC) or front-end sales charges, which would have reduced performance. |
Class A Shares | | 4.79% |
Class C Shares | | 3.86 |
Class Y Shares | | 5.05 |
Class IB Shares | | 4.89 |
Class IC Shares | | 4.90 |
Credit Suisse Leveraged Loan Indexq | | 4.39 |
Source(s): qBloomberg L.P. | | |
Market conditions and your Fund
Senior loans’ senior position in the capital structure, secured status and short duration positioned the asset class defensively against some of the key risks that influenced capital markets’ performance during the fiscal year: mainly, the potential for elevated defaults as well as the potential for rising interest rates. Senior loans’ defensive positioning, particularly as it relates to rising interest rates, benefited the asset class when compared to other fixed income investments paying fixed interest rates.
For the fiscal year ended February 28, 2018, the senior loan market, as represented by the Credit Suisse Leveraged
Loan Index, returned 4.39%. The market produced positive results in all but two months of the fiscal year as price stability and coupon income drove favorable absolute and volatility-adjusted performance. Libor increased from 1.09% to 2.01% during the fiscal year, enhancing the floating rate component of coupon income.1 (Libor is the London Interbank Offered Rate – the rate that international banks charge for short-term loans to one another.) However, the trajectory of Libor was flatter than expected at the beginning of the fiscal year. This both delayed the benefit of rising short-term rates to loan investors and eased duration concerns at times, prompting investors to
| | | | |
| Portfolio Composition† | |
| By credit quality, based on total investments | |
A+ | | | 0.1% | |
BBB | | | 0.1 | |
BBB- | | | 4.2 | |
BB+ | | | 8.1 | |
BB | | | 9.0 | |
BB- | | | 17.9 | |
B+ | | | 17.3 | |
B | | | 19.4 | |
B- | | | 5.9 | |
CCC+ | | | 3.7 | |
CCC | | | 2.1 | |
CCC- | | | 0.5 | |
CC | | | 1.6 | |
D | | | 0.4 | |
Non-Rated | | | 4.0 | |
Equity | | | 5.7 | |
| | | | | | |
| Top Five Debt Holdings | |
| Based on total investments | | | | |
1. | | NRG Energy, Inc., Revolver Loan A | | | 1.9% | |
2. | | Asurion LLC, Term Loan B-6 | | | 1.0 | |
3. | | iHeartCommunications, Inc., Term Loan E | | | 1.0 | |
4. | | Sinclair Television Group, Inc., Term Loan B | | | 0.9 | |
5. | | JBS USA Lux S.A., Term Loan | | | 0.9 | |
| | |
Total Net Assets | | $740.2 million |
Total Number of Holdings | | 682 |
The Fund’s holdings are subject to change, and there is no assurance that the Fund will continue to hold any particular security.
Data presented here are as of February 28, 2018.
| † | Source: Standard & Poor’s. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations, including specific securities, money market instruments or other debts. Ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest); ratings are subject to change without notice. “Non-Rated” indicates the debtor was not rated, and should not be interpreted as indicating low quality. For more information on Standard & Poor’s rating methodology, please visit standardandpoors.com and select “Understanding Ratings” under Rating Resources on the homepage. |
periodically rotate into longer-duration fixed income asset classes.
Demand for US credit was bolstered throughout the fiscal year due to accelerating economic growth, improving corporate earnings and a low default rate. Speculation over US Federal Reserve (the Fed) monetary policy and fiscal stimulus prospects further added to the demand for loans. This dynamic fostered an environment that was supportive of refinancing and re-pricing transactions, offering issuers the opportunity to reduce spreads and extend maturities. The technical support for loans stemmed mostly from greater-than-expected collateralized loan obligation (CLO) formation and a relative scarcity of new supply. All of these factors contributed to stable loan prices throughout the fiscal year and the aforementioned re-pricing activity.
Credit fundamentals of the loan market remained stable as economic growth accelerated, corporate earnings improved, commodity prices stabilized and the hunt for yield continued – all of which led to strong outperformance in the lower-quality end of the credit ratings spectrum during the fiscal year. Loan defaults remained below their long-term historical averages. With issuer distress isolated largely to the retail sector as well as other highly levered and/or secularly challenged companies, we believe default rates are likely to remain below their historical averages and to be driven by a few individual issuers with large capital structures.
At the close of the fiscal year, we continued to believe senior loans were well positioned for the economic and interest rate environment, providing investors with a relatively high level of current income as well as protection from rising rates due to their floating rate structure. With the market again poised to benefit from supportive fundamental and technical conditions, we believed that loans were positioned to deliver an attractive total return based on strong current income, price stability and limited near-term default risk. Loans also provide some insulation from interest rate-driven volatility, which is more likely to impact longer-duration asset classes. Historically, loans have performed well through periods of rising interest rates, and we believed loans were attractive on a relative basis as the differential between yields in high yield bonds and loans remained near historical lows. As such, we believed that senior loans offered investors the opportunity to own secured
4 Invesco Senior Loan Fund
credit exposure providing a similar yield as unsecured credit exposure with less duration risk.
During the fiscal year, the Fund used leverage, which allowed us to enhance the Fund’s yield while keeping credit standards high relative to the benchmark. As of the close of the fiscal year, leverage accounted for 19% of the Fund’s NAV plus borrowings. Leverage involves borrowing at a floating short-term rate and reinvesting the proceeds at a higher rate. Unlike other fixed income asset classes, using leverage in conjunction with senior loans does not involve the same degree of risk from rising short-term interest rates since the income from senior loans generally adjusts to changes in interest rates, as do the rates which determine the Fund’s borrowing costs. (Similarly, should short term rates fall, borrowing costs also would decline.) For more information about the Fund’s use of leverage, see the Notes to Financial Statements later in this report.
Twin River Management Group, IAP Worldwide Services and Samson Investment Company were the largest individual contributors to Fund performance for the fiscal year. On an industry basis, the Fund’s gaming/leisure, aerospace and information technology holdings contributed to the Fund’s absolute performance. HGIM, Adria Group Holding and Drill Rigs Holdings were the largest individual detractors from Fund performance for the fiscal year. We eliminated Adria Group Holding and Drill Rigs Holdings from the Fund before the close of the fiscal year.
The senior loan asset class behaves differently from many traditional fixed income investments. The interest income generated by a portfolio of senior loans is usually determined by a fixed credit spread over Libor. Because senior loans generally have a very short duration and the coupons or interest rates are usually adjusted every 30 to 90 days as Libor changes, the yield on the portfolio adjusts. Interest rate risk refers to the tendency for traditional fixed income prices to decline when interest rates rise. For senior loans, however, interest rates and income are variable and the prices of senior loans are therefore less sensitive to interest rate changes than traditional fixed income bonds. We are monitoring interest rates, the market and economic and geopolitical factors that may impact the direction, speed and magnitude of changes to interest rates across the maturity spectrum, including the potential impact of monetary policy changes by the
Fed and certain central banks. If interest rates rise faster than expected, markets may experience increased volatility, which may affect the value and/or liquidity of certain of the Fund’s investments or the market price of the Fund’s shares.
As always, we appreciate your continued participation in Invesco Senior Loan Fund.
1 Source: Federal Reserve Bank of St. Louis
The views and opinions expressed in management’s discussion of Fund performance are those of Invesco Advisers, Inc. These views and opinions are subject to change at any time based on factors such as market and economic conditions. These views and opinions may not be relied upon as investment advice or recommendations, or as an offer for a particular security. The information is not a complete analysis of every aspect of any market, country, industry, security or the Fund. Statements of fact are from sources considered reliable, but Invesco Advisers, Inc. makes no representation or warranty as to their completeness or accuracy. Although historical performance is no guarantee of future results, these insights may help you understand our investment management philosophy.
See important Fund and, if applicable, index disclosures later in this report.
| | |
 | | Scott Baskind Portfolio Manager, is manager of Invesco Senior Loan Fund. He joined Invesco or its investment advisory |
affiliates in 1999. Mr. Baskind earned a BS in business administration, with majors in finance and management information systems, from the University at Albany, State University of New York. |
 | | Tom Ewald Portfolio Manager, is manager of Invesco Senior Loan Fund. He joined Invesco or its investment advisory |
affiliates in 2000. Mr. Ewald earned a BA from Harvard College and an MBA from the Darden School of Business at the University of Virginia. |
 | | Philip Yarrow Chartered Financial Analyst, Portfolio Manager, is manager of Invesco Senior Loan Fund. He joined |
| Invesco in 2010. Mr. Yarrow earned a BS in mathematics and economics from The University of Nottingham and a master of management degree in finance from Northwestern University. |
5 Invesco Senior Loan Fund
Your Fund’s Long-Term Performance
| | | | |
Average Annual Total Returns | |
As of 2/28/18, including maximum applicable sales charges | |
| |
| Class A Shares | | | | |
| Inception (2/18/05) | | | 3.38% | |
| 10 Years | | | 4.37 | |
| 5 Years | | | 4.20 | |
| 1 Year | | | 1.45 | |
| |
| Class C Shares | | | | |
| Inception (2/18/05) | | | 2.88% | |
| 10 Years | | | 3.94 | |
| 5 Years | | | 4.11 | |
| 1 Year | | | 2.86 | |
| |
| Class Y Shares | | | | |
| Inception (11/8/13) | | | 4.66% | |
| 1 Year | | | 5.05 | |
| |
| Class IB Shares | | | | |
| Inception (10/4/89) | | | 4.99% | |
| 10 Years | | | 4.85 | |
| 5 Years | | | 5.12 | |
| 1 Year | | | 4.89 | |
| |
| Class IC Shares | | | | |
| Inception (6/13/03) | | | 4.43% | |
| 10 Years | | | 4.77 | |
| 5 Years | | | 4.99 | |
| 1 Year | | | 4.90 | |
The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Please visit invesco.com/performance for the most recent month-end performance. Performance figures reflect reinvested distributions, changes in net asset value and the effect of the maximum sales charge unless otherwise stated. Investment return and principal value will fluctuate so that you may have a gain or loss when you sell shares.
The total annual Fund operating expense ratio set forth in the most recent Fund prospectus as of the date of this report for Class A, Class B, Class C, Class Y, Class IB and Class IC shares was 2.06%, 2.06%, 2.81%, 1.81%, 1.81% and 1.96%, respectively. The expense ratios presented above may vary from the expense ratios presented in other sections of this report that are based on expenses incurred during the period covered by this report.
Class A share performance reflects the maximum 3.25% sales charge. Class B share performance reflects an early withdrawal charge of 3% for the
| | | | |
Average Annual Total Returns | |
As of 12/31/17, the most recent calendar quarter end, including maximum applicable sales charges | |
| |
| Class A Shares | | | | |
| Inception (2/18/05) | | | 3.32% | |
| 10 Years | | | 3.28 | |
| 5 Years | | | 4.36 | |
| 1 Year | | | 1.96 | |
| |
| Class B Shares* | | | | |
| Inception (2/18/05) | | | 3.16% | |
| 10 Years | | | 3.28 | |
| 5 Years | | | 4.99 | |
| 1 Year | | | 2.35 | |
| |
| Class C Shares | | | | |
| Inception (2/18/05) | | | 2.82% | |
| 10 Years | | | 2.84 | |
| 5 Years | | | 4.28 | |
| 1 Year | | | 3.58 | |
| |
| Class Y Shares | | | | |
| Inception (11/8/13) | | | 4.52% | |
| 1 Year | | | 5.62 | |
| |
| Class IB Shares | | | | |
| Inception (10/4/89) | | | 4.97% | |
| 10 Years | | | 3.74 | |
| 5 Years | | | 5.32 | |
| 1 Year | | | 5.62 | |
| |
| Class IC Shares | | | | |
| Inception (6/13/03) | | | 4.39% | |
| 10 Years | | | 3.66 | |
| 5 Years | | | 5.17 | |
| 1 Year | | | 5.47 | |
* Effective January 26, 2018, Class B shares were converted to Class A shares. | |
first year after purchase. Note: Effective January 26, 2018, Class B shares were converted to Class A shares. No CDSC was paid in connection with this early conversion. Class C share performance reflects an early withdrawal charge of 1% for the first year after purchase. Class IB shares, Class IC shares and Class B shares (after November 30, 2010) are not continuously offered and have no early withdrawal charges. Class Y shares do not have a front-end sales charge or a CDSC, therefore performance is at net asset value. Class Y shares do not have early withdrawal charges.
The performance of the Fund’s share classes will differ primarily due to different sales charge structures and class expenses.
Fund performance reflects any applicable fee waivers and/or expense reimbursements. Had the adviser not waived fees and/or reimbursed expenses currently or in the past, returns would have been lower. See current prospectus for more information.
6 Invesco Senior Loan Fund
Invesco Senior Loan Fund’s investment objective is to provide a high level of current income, consistent with preservation of capital.
| ∎ | | Unless otherwise stated, information presented in this report is as of February 28, 2018, and is based on total net assets. |
| ∎ | | Unless otherwise noted, all data provided by Invesco. |
| ∎ | | To access your Fund’s reports/prospectus, visit invesco.com/fundreports. |
About share classes
| ∎ | | Class IB shares and Class IC shares are not continuously offered and have no early withdrawal charges. |
| ∎ | | Effective January 26, 2018, all outstanding Class B shares were converted to Class A shares, in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion. |
| ∎ | | Class Y shares are available to only certain investors. Please see the prospectus for more information. |
Principal risks of investing in the Fund
| ∎ | | Asset-backed securities risk. Asset-backed securities, including collateralized debt obligations, are subject to prepayment or call risk, which is the risk that a borrower’s payments may be received earlier or later than expected due to changes in prepayment rates on underlying loans, which could result in the Fund reinvesting these early payments at lower interest rates, thereby reducing the Fund’s income. Asset-backed securities also are subject to extension risk, which is the risk that a rise in interest rates could reduce the rate of prepayments, causing the price of the asset-backed securities and the Fund’s share price to fall. |
| ∎ | | Banking and financial services industry focus risk. From time to time, the Fund may invest more than 25% of its assets in unsecured bank instruments, including but not limited to certificates of deposit and time deposits, or securities that may have guarantees or credit and liquidity enhancements provided by banks, insurance companies or other financial institutions. To the extent the Fund focuses its investments in these instruments or securities, the Fund’s performance will depend on the overall condition of those industries and the individual banks and financial institutions in which the Fund invests (directly or indirectly), the supply of short-term financing, changes in government |
| | | regulation, changes in interest rates, and economic downturns in the United States and abroad. |
| ∎ | | Bank loan risk. There are a number of risks associated with an investment in bank loans including credit risk, interest rate risk, liquidity risk and prepayment risk. Lack of an active trading market, restrictions on resale, irregular trading activity, wide bid/ask spreads and extended trade settlement periods may impair the Fund’s ability to sell bank loans within its desired time frame or at an acceptable price and its ability to accurately value existing and prospective investments. Extended trade settlement periods may result in cash not being immediately available to the Fund. As a result, the Fund may have to sell other investments or engage in borrowing transactions to raise cash to meet its obligations. The risk of holding bank loans is also directly tied to the risk of insolvency or bankruptcy of the issuing banks. These risks could cause the Fund to lose income or principal on a particular investment, which in turn could affect the Fund’s returns. The value of bank loans can be affected by and sensitive to changes in government regulation and to economic downturns in the United States and abroad. Bank loans generally are floating rate loans, which are subject to interest rate risk as the interest paid on the floating rate loans adjusts periodically based on changes in widely accepted reference rates. Bank loans held by the Fund might not be considered securities for purposes of the Securities Act of 1933 or the Securities Exchange Act of 1934, and therefore a risk exists that purchasers, such as the Fund, may not be entitled to rely on the anti-fraud provisions of those Acts. |
| ∎ | | Borrower credit risk. Senior Loans, like most other debt obligations, are subject to the risk of default. Default in the payment of interest or principal on a Senior Loan will result in a reduction in income to the Fund, a reduction in the |
| | | | |
| | This report must be accompanied or preceded by a currently effective Fund prospectus, which contains more complete information, including sales charges and expenses. Investors should read it carefully before investing. | | |
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
value of the Senior Loan and a potential decrease in the Fund’s net asset value. The risk of default will increase in the event of an economic downturn or a substantial increase in interest rates.
The Fund may acquire Senior Loans of Borrowers that are experiencing, or are more likely to experience, financial difficulty, including Senior Loans issued in highly leveraged transactions. The Fund may even acquire and retain in its portfolio Senior Loans of Borrowers that have filed for bankruptcy protection. Because of the protective terms of Senior Loans, the Adviser believes that the Fund is more likely to recover more of its investment in a defaulted Senior Loan than would be the case for most other types of defaulted debt securities. Nevertheless, even in the case of collateralized Senior Loans, there is no assurance that sale of the collateral would raise enough cash to satisfy the Borrower’s payment obligation or that the collateral can or will be liquidated. In the case of bankruptcy, liquidation may not occur and the court may not give Lenders the full benefit of their senior position. Uncollateralized Senior Loans involve a greater risk of loss.
| ∎ | | Changing fixed income market conditions risk. The current low interest rate environment was created in part by the Federal Reserve Board (FRB) and certain foreign central banks keeping the federal funds and equivalent foreign rates near, at or below zero. Increases in the federal funds and equivalent foreign rates may expose fixed income markets to heightened volatility and reduced liquidity for certain fixed income investments, particularly those with longer maturities. In addition, decreases in fixed income dealer market making capacity may also potentially lead to heightened volatility and reduced liquidity in the fixed income markets. As a result, the value of the Fund’s investments and share price may decline. Changes in central bank policies could also result in higher than normal shareholder redemptions, which could potentially increase portfolio turnover and the Fund’s transaction costs. |
continued on page 8
| | |
| 7 | | Invesco Senior Loan Fund |
continued from page 7
| ∎ | | Collateralized loan obligations risk. CLOs are subject to the risks of substantial losses due to actual defaults by underlying borrowers, which will be greater during periods of economic or financial stress. CLOs may also lose value due to collateral defaults and disappearance of subordinate tranches, market anticipation of defaults, and investor aversion to CLO securities as a class. The risks of CLOs will be greater if the Fund invests in CLOs that hold loans of uncreditworthy borrowers or if the Fund holds subordinate tranches of the CLO that absorbs losses from the defaults before senior tranches. In addition, CLOs are subject to interest rate risk and credit risk. |
| ∎ | | Credit linked notes risk. Risks of credit linked notes include those risks associated with the underlying reference obligation including but not limited to market risk, interest rate risk, credit risk, default risk and, in some cases, foreign currency risk. An investor in a credit linked note bears counterparty risk or the risk that the issuer of the credit linked note will default or become bankrupt and not make timely payment of principal and interest of the structured security. Credit linked notes may be less liquid than other investments and therefore harder to dispose of at the desired time and price. In addition, credit linked notes may be leveraged and, as a result, small changes in the value of the underlying reference obligation may produce disproportionate losses to the Fund. |
| ∎ | | Debt securities risk. The prices of debt securities held by the Fund will be affected by changes in interest rates, the creditworthiness of the issuer and other factors. An increase in prevailing interest rates typically causes the value of existing debt securities to fall and often has a greater impact on longer duration debt securities and higher quality debt securities. Falling interest rates will cause the Fund to reinvest the proceeds of debt securities that have been repaid by the issuer at lower interest rates. Falling interest rates may also reduce the Fund’s distributable income because interest payments on floating rate debt instruments held by the Fund will decline. The Fund could lose money on investments in debt securities if the issuer or borrower fails to meet its obligations to make interest payments and/or to repay principal in a timely manner. Changes in an issuer’s financial |
| | | strength, the market’s perception of such strength or in the credit rating of the issuer or the security may affect the value of debt securities. The Adviser’s credit analysis may fail to anticipate such changes, which could result in buying a debt security at an inopportune time or failing to sell a debt security in advance of a price decline or other credit event. |
| ∎ | | Defaulted securities risk. Defaulted securities pose a greater risk that principal will not be repaid than non-defaulted securities. Defaulted securities and any securities received in an exchange for such securities may be subject to restrictions on resale. |
| ∎ | | Derivatives risk. The value of a derivative instrument depends largely on (and is derived from) the value of an underlying security, currency, commodity, interest rate, index or other asset (each referred to as an underlying asset). In addition to risks relating to the underlying assets, the use of derivatives may include other, possibly greater, risks, including counterparty, leverage and liquidity risks. Counterparty risk is the risk that the counterparty to the derivative contract will default on its obligation to pay the Fund the amount owed or otherwise perform under the derivative contract. Derivatives create leverage risk because they do not require payment up front equal to the economic exposure created by owning the derivative. As a result, an adverse change in the value of the underlying asset could result in the Fund sustaining a loss that is substantially greater than the amount invested in the derivative, which may make the Fund’s returns more volatile and increase the risk of loss. Derivative instruments may also be less liquid than more traditional investments and the Fund may be unable to sell or close out its derivative positions at a desirable time or price. This risk may be more acute under adverse market conditions, during which the Fund may be most in need of liquidating its derivative positions. Derivatives may also be harder to value, less tax efficient and subject to changing government regulation that could impact the Fund’s ability to use certain derivatives or their cost. Also, derivatives used for hedging or to gain or limit exposure to a particular market segment may not provide the expected benefits, particularly during adverse market conditions. |
| ∎ | | Financial leverage risk. There are risks associated with borrowing or issuing preferred shares in an effort to increase the yield and distributions on the Common Shares, including that the costs of the financial leverage exceed the income from investments made with such leverage, the higher volatility of the net asset value of the Common Shares, and that fluctuations in the interest rates on the borrowing or dividend rates on preferred shares may affect the yield and distributions to the Common Shareholders. The Fund’s use of leverage also may impair the ability of the Fund to maintain its qualification for federal income tax purposes, as a regulated investment company. |
As long as the Fund is able to invest the proceeds of any financial leverage in senior loans or other investments that provide a higher net return than the current cost of such financial leverage (i.e., the current interest rate on any borrowing or dividend rate of any preferred shares after taking into account the expenses of any borrowing or preferred shares offering) and the Fund’s operating expenses, the effect of leverage will be to cause the Common Shareholders to realize a higher current rate of return than if the Fund were not leveraged. However, if the current costs of financial leverage were to exceed the return on such proceeds after expenses (which the Adviser believes to be an unlikely scenario), the Common Shareholders would have a lower rate of return than if the Fund had an unleveraged capital structure.
During any annual period when the Fund has a net payable on the interest due on borrowings or the dividends due on any outstanding preferred shares, the failure to pay on such amounts would preclude the Fund from paying dividends on the Common Shares. The rights of lenders to the Fund to receive interest on and repayment of principal on any borrowings will be senior to those of the holders of the Common Shares, and the terms of any such borrowings may contain provisions which limit certain activities of the Fund, including the payment of dividends to holders of Common Shares in certain circumstances, and may require the Fund to pledge assets to secure such borrowings. Further, the terms of such borrowings may, and the 1940 Act does (in certain circumstances), grant to the lenders to the Fund certain voting
| | |
| 8 | | Invesco Senior Loan Fund |
rights in the event of default in the payment of interest on or repayment of principal. In addition, under the 1940 Act, the Fund is not permitted to declare any cash dividend or other distribution on its Common Shares unless, at the time of such declaration and after deducting the amount of such dividend or distribution, the Fund is in compliance with the asset coverage requirements of the 1940 Act. Such prohibition on the payment of dividends or distributions might impair the ability of the Fund to maintain its qualification, for federal income tax purposes, as a regulated investment company. The Fund intends, however, to the extent possible, to repay borrowings or redeem any outstanding preferred securities from time to time if necessary, which may involve the payment by the Fund of a premium and the sale by the Fund of portfolio securities at a time when it may be disadvantageous to do so, to maintain compliance with such asset coverage requirements.
If there are preferred shares issued and outstanding, holders of the preferred shares will elect two Trustees. In addition, the terms of any preferred shares or borrowing may entitle holders of the preferred shares or lenders, as the case may be, to elect a majority of the Board of Trustees in certain other circumstances.
The Fund may be converted to an open-end investment company only upon approval by the Board of Trustees followed by the approval of shareholders as required by the 1940 Act. Among other things, conversion of the Fund to an open-end investment company would require the redemption of all outstanding preferred shares and could require the repayment of borrowings, which would eliminate the leveraged capital structure of the Fund with respect to the Common Shares.
| ∎ | | Foreign investments risk. The Fund’s foreign investments may be adversely affected by political and social instability, changes in economic or taxation policies, difficulty in enforcing obligations, decreased liquidity or increased volatility. Foreign investments also involve the risk of the possible seizure, nationalization or expropriation of the issuer or foreign deposits (in which the Fund could lose its entire investments in a certain market) and the possible adoption of foreign governmental restrictions such as exchange controls. |
Unless the Fund has hedged its foreign securities risk, foreign securities risk also involves the risk of negative foreign currency rate fluctuations, which may cause the value of securities denominated in such foreign currency (or other instruments through which the Fund has exposure to foreign currencies) to decline in value. Currency exchange rates may fluctuate significantly over short periods of time. Currency hedging strategies, if used, are not always successful.
| ∎ | | High yield debt securities (junk bond) risk. Investments in high yield debt securities (“junk bonds”) and other lower-rated securities will subject the Fund to substantial risk of loss. These securities are considered to be speculative with respect to the issuer’s ability to pay interest and principal when due, are more susceptible to default or decline in market value and are less liquid than investment grade debt securities. Prices of high yield debt securities tend to be very volatile. |
| ∎ | | High yield senior loans risk. Investments in high yield Senior Loans (“junk investments”) and other lower-rated Senior Loans will subject the Fund to substantial risk of loss. These Senior Loans are considered to be speculative with respect to the issuer’s ability to pay interest and principal when due, are more susceptible to default or decline in market value and are less liquid than investment grade debt securities. Prices of high yield Senior Loans tend to be very volatile. |
| ∎ | | Inflation-indexed securities risk. The values of inflation-indexed securities generally fluctuate in response to changes in real interest rates, and the Fund’s income from its investments in these securities is likely to fluctuate considerably more than the income distributions of its investments in more traditional fixed-income securities. |
| ∎ | | Liquidity risk. The Fund may be unable to sell illiquid investments at the time or price it desires and, as a result, could lose its entire investment in such investments. Liquid securities can become illiquid during periods of market stress. If a significant amount of the Fund’s securities become illiquid, the Fund may not be able to timely pay redemption proceeds and may need to sell securities at significantly reduced prices. |
| ∎ | | Management risk. The Fund is actively managed and depends heavily on the Adviser’s judgment about markets, |
| | | interest rates or the attractiveness, relative values, liquidity, or potential appreciation of particular investments made for the Fund’s portfolio. The Fund could experience losses if these judgments prove to be incorrect. Additionally, legislative, regulatory, or tax developments may adversely affect management of the Fund and, therefore, the ability of the Fund to achieve its investment objective. |
| ∎ | | Market risk. The market values of the Fund’s investments, and therefore the value of the Fund’s shares, will go up and down, sometimes rapidly or unpredictably. Market risk may affect a single issuer, industry or section of the economy, or it may affect the market as a whole. Individual stock prices tend to go up and down more dramatically than those of certain other types of investments, such as bonds. During a general downturn in the financial markets, multiple asset classes may decline in value. When markets perform well, there can be no assurance that specific investments held by the Fund will rise in value. |
| ∎ | | No trading market for shares. The Fund is a closed-end investment company designed primarily for long-term investors and not as a trading vehicle. While there is no restriction on transferring the Shares, the Fund does not intend to list the Shares for trading on any national securities exchange. There is no secondary trading market for Shares. An investment in the Shares is illiquid. There is no guarantee that you will be able to sell all of the Shares that you desire to sell in any repurchase offer by the Fund. |
| ∎ | | Repurchase offer risks. If the Fund repurchases more Shares than it is able to sell, the Fund’s net assets may decline and its expense ratios may increase, and the Fund’s ability to achieve its investment objective may be adversely affected. Moreover, this may force the Fund to sell assets it would not otherwise sell, and the Fund may be forced to dispose of Fund assets that may have declined in value. The Fund may borrow money to, among other things, finance repurchases of Shares. The rights of any lenders to the Fund to receive payments of interest on and repayments of principal of any borrowings will be senior to the rights of shareholders. The loan agreement for any borrowing likely will limit certain activities of the Fund, including the payment of dividends to holders of |
9 Invesco Senior Loan Fund
continued from page 9
Shares in certain circumstances. Interest payments and fees incurred in connection with borrowings to finance repurchases of Shares will reduce the amount of net income available for payment to shareholders and may increase volatility of the net asset value of the Common Shares. See also the next section above on “Financial leverage” and the section of the Prospectus entitled “Repurchase of Shares.”
| ∎ | | Warrants, equity securities and junior debt securities. Warrants, equity securities and junior debt securities have a subordinate claim on a Borrower’s assets as compared with Senior Loans. As a result, the values of warrants, equity securities and junior debt securities generally are more dependent on the financial condition of the Borrower and less dependent on fluctuations in interest rates than are the values of many debt securities. The values of warrants, equity securities and junior debt securities may be more volatile than those of Senior Loans and thus may increase the volatility of the Fund’s net asset value. Additionally, warrants may be significantly less valuable on their relevant expiration date resulting in a loss of money or they may expire worthless resulting in a total loss of the investment. Warrants may also be postponed or terminated early resulting in a partial or total loss of the investment. Warrants may also be illiquid. |
About indexes used in this report
| ∎ | | The Credit Suisse Leveraged Loan Index represents tradable, senior-secured, US dollar-denominated, non-investment grade loans. |
| ∎ | | The Fund is not managed to track the performance of any particular index, including the index(es) described here, and consequently, the performance of the Fund may deviate significantly from the performance of the index(es). |
| ∎ | | A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges. Performance of the peer group, if applicable, reflects fund expenses; performance of a market index does not. |
Other information
| ∎ | | The returns shown in management’s discussion of Fund performance are based on net asset values (NAVs) calculated for shareholder transactions. Generally accepted accounting principles require adjustments to be made to the net assets of the Fund at period end for financial reporting purposes, and as such, the NAVs for shareholder transactions and the returns based on those NAVs may differ from the NAVs and returns reported in the Financial Highlights. |
| ∎ | | Industry classifications used in this report are generally according to the Global Industry Classification Standard, which was developed by and is the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
| | |
| 10 | | Invesco Senior Loan Fund |
Schedule of Investments
February 28, 2018
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
Variable Rate Senior Loan Interests–109.91%(b)(c) | | | | | | | | | |
| Aerospace & Defense–3.30% | | | | | | | | | |
Consolidated Aerospace Manufacturing, LLC, Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 08/11/2022 | | | $ | 1,454 | | | $ | 1,456,509 | |
DAE Aviation Holdings, Inc., Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 07/07/2022 | | | | 303 | | | | 306,727 | |
Greenrock Finance, Inc., Term Loan B (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 06/28/2024 | | | | 1,358 | | | | 1,375,413 | |
IAP Worldwide Services, | | | | | | | | | | | | | | | | |
Revolver Loan (Acquired 08/05/2014; Cost $1,350,691)(d)(e) | | | 0.00 | % | | | 07/18/2018 | | | | 1,351 | | | | 1,350,690 | |
Revolver Loan (3 mo. USD LIBOR + 5.50%) (Acquired 08/05/2014; Cost $150,077)(e) | | | 1.39 | % | | | 07/18/2018 | | | | 150 | | | | 150,078 | |
Second Lien Term Loan (3 mo. USD LIBOR + 6.50%) | | | 8.19 | % | | | 07/18/2019 | | | | 1,712 | | | | 1,696,732 | |
Maxar Technologies Ltd. (Canada), Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.33 | % | | | 10/05/2024 | | | | 1,689 | | | | 1,699,226 | |
Peraton Corp., Term Loan (3 mo. USD LIBOR + 5.25%) | | | 6.95 | % | | | 04/29/2024 | | | | 902 | | | | 913,214 | |
TransDigm Inc., | | | | | | | | | | | | | | | | |
Term Loan E (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 05/14/2022 | | | | 4,676 | | | | 4,712,395 | |
Term Loan F (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 06/09/2023 | | | | 5,490 | | | | 5,530,366 | |
Term Loan F (3 mo. USD LIBOR + 2.75%) | | | 4.41 | % | | | 06/09/2023 | | | | 2,864 | | | | 2,885,125 | |
Vectra Co., | | | | | | | | | | | | | | | | |
First Lien Term Loan(f) | | | — | | | | 03/01/2025 | | | | 593 | | | | 594,075 | |
Second Lien Term Loan(f) | | | — | | | | 03/01/2026 | | | | 348 | | | | 349,327 | |
Wesco Aircraft Hardware Corp., Term Loan B (3 mo. USD LIBOR + 2.50%) | | | 3.84 | % | | | 02/28/2021 | | | | 919 | | | | 910,615 | |
Xebec Global Holdings, LLC, Term Loan (3 mo. USD LIBOR + 5.50%)(e) | | | 7.32 | % | | | 02/12/2024 | | | | 524 | | | | 518,796 | |
| | | | | | | | | | | | | | | | 24,449,288 | |
| | |
| Air Transport–1.23% | | | | | | | | | |
American Airlines, Inc., Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.59 | % | | | 12/14/2023 | | | | 1,561 | | | | 1,562,364 | |
Avolon TLB Borrower 1 (US) LLC, Term Loan B-2 (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 03/21/2022 | | | | 4,448 | | | | 4,447,266 | |
Gol LuxCo S.A. (Luxembourg), Term Loan (Acquired 08/21/2015; Cost $2,981,644)(e) | | | 6.50 | % | | | 08/31/2020 | | | | 2,998 | | | | 3,072,914 | |
United Airlines, Inc., Term Loan B (3 mo. USD LIBOR + 2.00%) | | | 3.77 | % | | | 04/01/2024 | | | | 54 | | | | 54,264 | |
| | | | | | | | | | | | | | | | 9,136,808 | |
| | |
| Automotive–1.88% | | | | | | | | | |
Allison Transmission, Inc., Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 09/23/2022 | | | | 21 | | | | 21,034 | |
American Axle & Manufacturing, Inc., Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.88 | % | | | 04/06/2024 | | | | 1,217 | | | | 1,223,891 | |
Belron Finance US LLC, Term Loan B (3 mo. USD LIBOR + 2.50%) | | | 4.29 | % | | | 11/07/2024 | | | | 868 | | | | 873,678 | |
Britax US Holdings Inc., Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 10/15/2020 | | | | 512 | | | | 455,278 | |
CH Hold Corp., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 02/01/2024 | | | | 780 | | | | 785,807 | |
Dayco Products, LLC, Term Loan (3 mo. USD LIBOR + 5.00%)(e) | | | 6.65 | % | | | 05/19/2023 | | | | 662 | | | | 672,322 | |
Dealer Tire, LLC, Term Loan (3 mo. USD LIBOR + 3.25%) | | | 5.00 | % | | | 12/22/2021 | | | | 227 | | | | 230,207 | |
Key Safety Systems, Inc., Term Loan (3 mo. USD LIBOR + 4.50%) | | | 6.28 | % | | | 08/29/2021 | | | | 294 | | | | 294,984 | |
Midas Intermediate Holdco II, LLC, Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.44 | % | | | 08/18/2021 | | | | 83 | | | | 83,830 | |
Navistar, Inc., Term Loan B (1 mo. USD LIBOR + 3.50%) | | | 5.08 | % | | | 11/06/2024 | | | | 952 | | | | 957,356 | |
Superior Industries International, Inc., Term Loan (1 mo. USD LIBOR + 4.50%) | | | 6.15 | % | | | 05/22/2024 | | | | 895 | | | | 907,084 | |
ThermaSys Corp., Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.72 | % | | | 05/03/2019 | | | | 1,413 | | | | 1,377,462 | |
Tower Automotive Holdings USA, LLC, Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.38 | % | | | 03/07/2024 | | | | 1,651 | | | | 1,656,273 | |
Transtar Holding Co., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 4.25%)(e) | | | 5.60 | % | | | 04/11/2022 | | | | 2,134 | | | | 1,984,386 | |
PIK Term Loan, 7.75% PIK Rate; 1.00% Cash Rate
(Acquired 04/11/2017-10/11/2017; Cost $635,806)(e)(g) | | | 7.75 | % | | | 04/11/2022 | | | | 673 | | | | 628,860 | |
Term Loan(d)(e) | | | 0.00 | % | | | 04/11/2022 | | | | 170 | | | | 169,110 | |
Term Loan (3 mo. USD LIBOR + 4.25%)(e) | | | 4.55 | % | | | 04/11/2022 | | | | 695 | | | | 691,252 | |
Wand Intermediate I L.P., Second Lien Term Loan (3 mo. USD LIBOR + 7.25%) | | | 9.14 | % | | | 09/19/2022 | | | | 913 | | | | 919,326 | |
| | | | | | | | | | | | | | | | 13,932,140 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
11 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Beverage & Tobacco–0.49% | | | | | | | | | |
AI Aqua Merger Sub, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan B-1 (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/13/2023 | | | $ | 1,464 | | | $ | 1,471,419 | |
Incremental First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/13/2023 | | | | 559 | | | | 561,880 | |
Arctic Glacier U.S.A. Inc., Term Loan (1 mo. USD LIBOR + 4.25%) | | | 5.90 | % | | | 03/20/2024 | | | | 505 | | | | 507,150 | |
Constellation Brands Canada, Inc. (Canada), First Lien Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.38 | % | | | 12/15/2023 | | | | 454 | | | | 457,675 | |
Winebow Holdings, Inc., Second Lien Term Loan (1 mo. USD LIBOR + 7.50%)(e) | | | 9.15 | % | | | 01/02/2022 | | | | 655 | | | | 612,067 | |
| | | | | | | | | | | | | | | | 3,610,191 | |
| | |
| Building & Development–2.97% | | | | | | | | | |
American Builders & Contractors Supply Co., Inc., Term Loan B-1 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 10/31/2023 | | | | 879 | | | | 885,463 | |
Beacon Roofing Supply, Inc., Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.83 | % | | | 01/02/2025 | | | | 1,436 | | | | 1,445,279 | |
Capital Automotive L.P., | | | | | | | | | | | | | | | | |
First Lien Term Loan B-2 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 03/25/2024 | | | | 3,172 | | | | 3,192,097 | |
Second Lien Term Loan B (1 mo. USD LIBOR + 6.00%) | | | 7.65 | % | | | 03/24/2025 | | | | 1,479 | | | | 1,509,492 | |
DiversiTech Holdings, Inc., | | | | | | | | | | | | | | | | |
Second Lien Term Loan (3 mo. USD LIBOR + 7.50%)(e) | | | 9.20 | % | | | 06/02/2025 | | | | 202 | | | | 205,124 | |
Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.20 | % | | | 06/03/2024 | | | | 485 | | | | 486,916 | |
Term Loan B-1(f) | | | — | | | | 06/03/2024 | | | | 147 | | | | 147,829 | |
Forterra Finance, LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 10/25/2023 | | | | 1,474 | | | | 1,386,285 | |
HD Supply Waterworks, Ltd., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.57 | % | | | 08/01/2024 | | | | 998 | | | | 1,002,509 | |
HD Supply, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-3 (3 mo. USD LIBOR + 2.25%) | | | 3.94 | % | | | 08/13/2021 | | | | 37 | | | | 36,777 | |
Term Loan B-4 (3 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 10/17/2023 | | | | 1,555 | | | | 1,567,702 | |
Janus International Group, LLC, Term Loan(f) | | | — | | | | 02/28/2025 | | | | 346 | | | | 346,159 | |
Mueller Water Products, Inc., | | | | | | | | | | | | | | | | |
Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 11/25/2021 | | | | 155 | | | | 157,052 | |
Term Loan B (3 mo. USD LIBOR + 2.50%) | | | 4.16 | % | | | 11/25/2021 | | | | 70 | | | | 70,301 | |
Quikrete Holdings, Inc., First Lien Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 11/15/2023 | | | | 3,200 | | | | 3,217,603 | |
RE/MAX, LLC, Term Loan (3 mo. USD LIBOR + 2.75%)
(Acquired 12/14/2016; Cost $2,329,276)(e) | | | 4.44 | % | | | 12/15/2023 | | | | 2,339 | | | | 2,345,049 | |
Realogy Group LLC, Term Loan(f) | | | — | | | | 02/08/2025 | | | | 2,883 | | | | 2,902,534 | |
Werner FinCo L.P., Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 07/24/2024 | | | | 1,067 | | | | 1,080,553 | |
| | | | | | | | | | | | | | | | 21,984,724 | |
| | |
| Business Equipment & Services–9.96% | | | | | | | | | |
Allied Universal Holdco LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.44 | % | | | 07/28/2022 | | | | 1,636 | | | | 1,620,478 | |
Incremental Delayed Draw Term Loan(d) | | | 0.00 | % | | | 07/28/2022 | | | | 458 | | | | 453,303 | |
Alorica Inc., Term Loan B (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 06/30/2022 | | | | 1,115 | | | | 1,121,454 | |
Altran Technologies (France), Term Loan B(f) | | | — | | | | 02/01/2025 | | | | 357 | | | | 360,226 | |
Asurion LLC, | | | | | | | | | | | | | | | | |
Second Lien Term Loan B-2 (1 mo. USD LIBOR + 6.00%) | | | 7.65 | % | | | 08/04/2025 | | | | 5,242 | | | | 5,385,961 | |
Term Loan B-4 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 08/04/2022 | | | | 146 | | | | 146,903 | |
Term Loan B-6 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 11/03/2023 | | | | 9,343 | | | | 9,402,450 | |
Blucora, Inc., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 05/22/2024 | | | | 1,034 | | | | 1,041,993 | |
Brand Energy & Infrastructure Services, Inc., Term Loan (3 mo. USD LIBOR + 4.25%) | | | 6.00 | % | | | 06/21/2024 | | | | 2,481 | | | | 2,504,027 | |
Brickman Group Ltd. LLC, | | | | | | | | | | | | | | | | |
First Lien Revolver Loan (Acquired 10/14/2016; Cost $396,296)(d) | | | 0.00 | % | | | 12/18/2018 | | | | 418 | | | | 386,515 | |
Second Lien Term Loan (1 mo. USD LIBOR + 6.50%) | | | 8.09 | % | | | 12/17/2021 | | | | 234 | | | | 235,847 | |
Caraustar Industries, Inc., Term Loan (3 mo. USD LIBOR + 5.50%) | | | 7.19 | % | | | 03/14/2022 | | | | 1,616 | | | | 1,625,505 | |
Change Healthcare Holdings, Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 03/01/2024 | | | | 2,288 | | | | 2,294,903 | |
Checkout Holding Corp., First Lien Term Loan B (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 04/09/2021 | | | | 2,676 | | | | 2,121,942 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
12 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Business Equipment & Services–(continued) | | | | | | | | | |
Cotiviti Corp., | | | | | | | | | | | | | | | | |
First Lien Term Loan B (3 mo. USD LIBOR + 2.25%) | | | 3.95 | % | | | 09/28/2023 | | | $ | 686 | | | $ | 691,191 | |
Term Loan A (3 mo. USD LIBOR + 2.25%) | | | 3.95 | % | | | 09/28/2021 | | | | 887 | | | | 886,569 | |
CRCI Holdings, Inc., Term Loan (3 mo. USD LIBOR + 5.50%) | | | 7.19 | % | | | 08/31/2023 | | | | 958 | | | | 961,560 | |
Crossmark Holdings, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.50%) | | �� | 5.19 | % | | | 12/20/2019 | | | | 1,584 | | | | 814,446 | |
Second Lien Term Loan (3 mo. USD LIBOR + 7.50%) | | | 9.19 | % | | | 12/21/2020 | | | | 826 | | | | 77,217 | |
Dakota Holding Corp., Term Loan(f) | | | — | | | | 02/13/2025 | | | | 823 | | | | 831,294 | |
First Data Corp., | | | | | | | | | | | | | | | | |
Term Loan A (1 mo. USD LIBOR + 2.25%) | | | 3.87 | % | | | 04/26/2024 | | | | 3,073 | | | | 3,082,783 | |
Term Loan D (1 mo. USD LIBOR + 2.25%) | | | 3.87 | % | | | 07/08/2022 | | | | 22 | | | | 21,980 | |
FleetCor Technologies Operating Co., LLC, Term Loan B-3 (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 08/02/2024 | | | | 231 | | | | 232,187 | |
Genesys Telecom Holdings, U.S., Inc., Term Loan B-2 (3 mo. USD LIBOR + 3.75%) | | | 5.44 | % | | | 12/01/2023 | | | | 4,035 | | | | 4,057,940 | |
Hillman Group, Inc., Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 06/30/2021 | | | | 1,520 | | | | 1,537,242 | |
IndigoCyan Midco Ltd. (Jersey), Term Loan B (3 mo. GBP LIBOR + 5.00%)(e) | | | 5.58 | % | | | 06/23/2024 | | | GBP | 609 | | | | 836,759 | |
Information Resources, Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.25%) | | | 6.19 | % | | | 01/18/2024 | | | | 1,193 | | | | 1,203,190 | |
ION Trading Technologies S.a.r.l. (Luxembourg), Term Loan (2 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 11/21/2024 | | | | 343 | | | | 340,917 | |
KAR Auction Services, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-4 (3 mo. USD LIBOR + 2.25%) | | | 4.00 | % | | | 03/11/2021 | | | | 73 | | | | 73,148 | |
Term Loan B-5 (3 mo. USD LIBOR + 2.50%) | | | 4.25 | % | | | 03/09/2023 | | | | 1,304 | | | | 1,313,351 | |
Karman Buyer Corp., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.25%) | | | 5.02 | % | | | 07/23/2021 | | | | 331 | | | | 327,210 | |
Incremental Term Loan B-2 (3 mo. USD LIBOR + 3.25%) | | | 5.02 | % | | | 07/23/2021 | | | | 3,009 | | | | 2,970,918 | |
Second Lien Term Loan (3 mo. USD LIBOR + 6.50%) | | | 8.27 | % | | | 07/25/2022 | | | | 1,088 | | | | 1,054,094 | |
Learning Care Group (US) No. 2 Inc., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 05/05/2021 | | | | 316 | | | | 320,108 | |
Term Loan (2 mo. USD LIBOR + 4.00%) | | | 5.63 | % | | | 05/05/2021 | | | | 874 | | | | 886,998 | |
LegalZoom.com, Inc., Term Loan (1 mo. USD LIBOR + 4.50%)(e) | | | 6.09 | % | | | 11/21/2024 | | | | 692 | | | | 698,132 | |
ON Assignment, Inc., Term Loan B(f) | | | — | | | | 04/02/2025 | | | | 646 | | | | 650,162 | |
Outfront Media Capital LLC, Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.62 | % | | | 03/18/2024 | | | | 94 | | | | 94,623 | |
Peak 10, Inc., First Lien Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 08/01/2024 | | | | 1,213 | | | | 1,218,049 | |
Prime Security Services Borrower, LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan B-1 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 05/02/2022 | | | | 1,079 | | | | 1,089,349 | |
Revolver Loan(d)(e) | | | 0.00 | % | | | 05/02/2022 | | | | 1,431 | | | | 1,430,133 | |
Prometric Holdings, Inc., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.77 | % | | | 01/29/2025 | | | | 573 | | | | 578,645 | |
Red Ventures, LLC, First Lien Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 11/08/2024 | | | | 1,439 | | | | 1,450,622 | |
Spin Holdco Inc., First Lien Term Loan B-1 (3 mo. USD LIBOR + 3.25%) | | | 5.08 | % | | | 11/14/2022 | | | | 5,718 | | | | 5,759,848 | |
Tempo Acquisition LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 05/01/2024 | | | | 627 | | | | 629,479 | |
TNS Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.78 | % | | | 08/14/2022 | | | | 358 | | | | 360,789 | |
Travelport Finance S.a.r.l. (Luxembourg), Term Loan D (3 mo. USD LIBOR + 2.75%) | | | 4.59 | % | | | 09/02/2021 | | | | 825 | | | | 828,617 | |
U.S. Security Associates Holdings, Inc., Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.69 | % | | | 07/14/2023 | | | | 1,260 | | | | 1,273,213 | |
Ventia Deco LLC, Term Loan B (3 mo. USD LIBOR + 3.50%)(e) | | | 5.19 | % | | | 05/21/2022 | | | | 1,270 | | | | 1,288,685 | |
Wash MultiFamily Acquisition Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 05/13/2022 | | | | 155 | | | | 156,562 | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 05/16/2022 | | | | 1,111 | | | | 1,119,346 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.00%)(e) | | | 8.65 | % | | | 05/12/2023 | | | | 121 | | | | 120,757 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.00%)(e) | | | 8.65 | % | | | 05/14/2023 | | | | 21 | | | | 21,150 | |
West Corp., Term Loan B (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 10/10/2024 | | | | 2,968 | | | | 2,997,756 | |
WEX Inc., Term Loan B-2 (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 06/30/2023 | | | | 726 | | | | 732,213 | |
| | | | | | | | | | | | | | | | 73,720,739 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
13 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Cable & Satellite Television–6.78% | | | | | | | | | |
Altice Financing S.A. (Luxembourg), | | | | | | | | | | | | | | | | |
Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.47 | % | | | 07/15/2025 | | | $ | 960 | | | $ | 949,378 | |
Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.47 | % | | | 01/31/2026 | | | | 539 | | | | 533,910 | |
Altice US Finance I Corp., Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 07/28/2025 | | | | 2,108 | | | | 2,109,025 | |
Atlantic Broadband Finance, LLC, Term Loan B (1 mo. USD LIBOR + 2.38%) | | | 4.02 | % | | | 01/04/2025 | | | | 3,237 | | | | 3,239,100 | |
Cable One, Inc., Incremental Term Loan B-1 (3 mo. USD LIBOR + 2.25%)(e) | | | 3.95 | % | | | 05/01/2024 | | | | 367 | | | | 368,393 | |
CSC Holdings, LLC, | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 07/17/2025 | | | | 6,669 | | | | 6,663,663 | |
Term Loan (2 mo. USD LIBOR + 2.50%) | | | 4.14 | % | | | 01/25/2026 | | | | 2,030 | | | | 2,034,786 | |
Mediacom Illinois LLC, Term Loan K (1 wk. USD LIBOR + 2.25%) | | | 3.73 | % | | | 02/15/2024 | | | | 1,751 | | | | 1,761,217 | |
Numericable-SFR S.A. (France), Term Loan B-12 (3 mo. USD LIBOR + 3.00%) | | | 4.72 | % | | | 01/31/2026 | | | | 5,500 | | | | 5,308,529 | |
Telenet Financing USD LLC, Term Loan AL (1 mo. USD LIBOR + 2.50%) | | | 4.09 | % | | | 03/31/2026 | | | | 3,183 | | | | 3,197,390 | |
Unitymedia Finance LLC, | | | | | | | | | | | | | | | | |
Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 09/30/2025 | | | | 1,532 | | | | 1,531,688 | |
Term Loan D (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 01/15/2026 | | | | 1,496 | | | | 1,496,763 | |
UPC Financing Partnership, Term Loan AR (1 mo. USD LIBOR + 2.50%) | | | 4.09 | % | | | 01/15/2026 | | | | 7,159 | | | | 7,163,945 | |
Virgin Media Bristol LLC (United Kingdom), Term Loan K (1 mo. USD LIBOR + 2.50%) | | | 4.09 | % | | | 01/15/2026 | | | | 7,792 | | | | 7,827,075 | |
WideOpenWest Finance, LLC, Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.85 | % | | | 08/18/2023 | | | | 2,974 | | | | 2,970,851 | |
Ziggo Secured Finance Partnership, Term Loan E (1 mo. USD LIBOR + 2.50%) | | | 4.09 | % | | | 04/15/2025 | | | | 3,015 | | | | 2,990,856 | |
| | | | | | | | | | | | | | | | 50,146,569 | |
| | |
| Chemicals & Plastics–3.78% | | | | | | | | | |
Alpha US Bidco, Inc., Term Loan B-1 (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 01/31/2024 | | | | 758 | | | | 763,814 | |
Avantor Inc., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. EURIBOR + 4.25%) | | | 4.25 | % | | | 11/21/2024 | | | EUR | 1,592 | | | | 1,955,159 | |
Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 11/21/2024 | | | | 3,784 | | | | 3,825,374 | |
Charter NEX US, Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 05/16/2024 | | | | 323 | | | | 324,137 | |
Chemours Co., (The), Term Loan B-1 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 05/12/2022 | | | | 509 | | | | 512,732 | |
Colouroz Investment LLC (Germany), | | | | | | | | | | | | | | | | |
First Lien Term Loan B-2 (3 mo. USD LIBOR + 3.00%) | | | 4.74 | % | | | 09/07/2021 | | | | 1,846 | | | | 1,742,517 | |
Second Lien Term Loan B-2 (3 mo. USD LIBOR + 7.25%) | | | 8.99 | % | | | 09/05/2022 | | | | 2,104 | | | | 1,801,877 | |
Term Loan C (3 mo. USD LIBOR + 3.00%) | | | 4.74 | % | | | 09/07/2021 | | | | 305 | | | | 288,058 | |
Diamond (BC) B.V. (Netherlands), Term Loan B (2 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 09/06/2024 | | | | 1,050 | | | | 1,049,526 | |
Encapsys, LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 11/07/2024 | | | | 223 | | | | 225,291 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.50%) | | | 9.15 | % | | | 11/07/2025 | | | | 114 | | | | 116,241 | |
H.B. Fuller Co., Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 10/20/2024 | | | | 2,083 | | | | 2,094,650 | |
HII Holding Corp. | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 12/20/2019 | | | | 397 | | | | 398,102 | |
Second Lien Term Loan (1 mo. USD LIBOR + 8.50%)(e) | | | 10.15 | % | | | 12/21/2020 | | | | 202 | | | | 203,451 | |
Ineos US Finance LLC, Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 03/31/2024 | | | | 1,494 | | | | 1,500,371 | |
Invictus US NewCo LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan(f) | | | — | | | | 02/15/2025 | | | | 717 | | | | 723,405 | |
Second Lien Term Loan(f) | | | — | | | | 02/15/2026 | | | | 379 | | | | 383,007 | |
KMG Chemicals Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 06/15/2024 | | | | 610 | | | | 614,540 | |
KPEX Holdings Inc., | | | | | | | | | | | | | | | | |
Delayed Draw Term Loan(d) | | | 0.00 | % | | | 01/31/2025 | | | | 35 | | | | 34,585 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.00%)(e) | | | 8.57 | % | | | 01/31/2026 | | | | 149 | | | | 150,984 | |
Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 01/31/2025 | | | | 348 | | | | 349,699 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
14 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Chemicals & Plastics–(continued) | | | | | | | | | |
MacDermid, Inc., | | | | | | | | | | | | | | | | |
First Lien Multicurrency Revolver Loan(d)(e) | | | 0.00 | % | | | 06/07/2018 | | | $ | 450 | | | $ | 449,020 | |
First Lien Multicurrency Revolver Loan (Prime Rate + 2.00%)(e) | | | 3.00 | % | | | 06/07/2018 | | | | 320 | | | | 319,850 | |
First Lien Revolver Loan(d)(e) | | | 0.00 | % | | | 06/07/2018 | | | | 154 | | | | 153,774 | |
First Lien Revolver Loan (1 mo. USD LIBOR + 3.00%)(e) | | | 3.76 | % | | | 06/07/2018 | | | | 616 | | | | 615,096 | |
Term Loan B-6 (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 06/07/2023 | | | | 665 | | | | 670,056 | |
Term Loan B-7 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 06/07/2020 | | | | 54 | | | | 54,384 | |
Oxea Corp., Term Loan B-2 (3 mo. USD LIBOR + 3.50%) | | | 5.25 | % | | | 10/11/2024 | | | | 2,282 | | | | 2,298,661 | |
PQ Corp., Term Loan B-1(f) | | | — | | | | 02/05/2025 | | | | 400 | | | | 402,349 | |
Proampac PG Borrower LLC, First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.09 | % | | | 11/20/2023 | | | | 1,029 | | | | 1,042,011 | |
Tata Chemicals North America Inc., Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.50 | % | | | 08/07/2020 | | | | 902 | | | | 907,340 | |
Trinseo Materials Finance, Inc., Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 09/06/2024 | | | | 369 | | | | 371,955 | |
Tronox Finance LLC, | | | | | | | | | | | | | | | | |
Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 09/22/2024 | | | | 355 | | | | 358,008 | |
Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 09/22/2024 | | | | 820 | | | | 826,173 | |
Venator Finance S.a.r.l., Term Loan (1 mo. USD LIBOR + 3.00%)(e) | | | 4.65 | % | | | 08/08/2024 | | | | 469 | | | | 472,330 | |
| | | | | | | | | | | | | | | | 27,998,527 | |
| | |
| Clothing & Textiles–0.88% | | | | | | | | | |
ABG Intermediate Holdings 2 LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 09/29/2024 | | | | 2,284 | | | | 2,304,954 | |
Second Lien Term Loan (3 mo. USD LIBOR + 7.75%) | | | 9.44 | % | | | 09/29/2025 | | | | 823 | | | | 836,525 | |
Ascena Retail Group, Inc., Term Loan B (1 mo. USD LIBOR + 4.50%) | | | 6.19 | % | | | 08/21/2022 | | | | 1,633 | | | | 1,470,291 | |
Oak Parent, Inc., Term Loan (1 mo. USD LIBOR + 4.50%)(e) | | | 6.15 | % | | | 10/26/2023 | | | | 1,207 | | | | 1,162,962 | |
Varsity Brands Holding Co., Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/16/2024 | | | | 754 | | | | 763,827 | |
| | | | | | | | | | | | | | | | 6,538,559 | |
| | |
| Conglomerates–0.43% | | | | | | | | | |
CTC AcquiCo GmbH (Germany), | | | | | | | | | | | | | | | | |
Term Loan B-1(f) | | | — | | | | 11/29/2024 | | | EUR | 458 | | | | 560,167 | |
Term Loan B-2(f) | | | — | | | | 11/29/2024 | | | | 612 | | | | 613,511 | |
Penn Engineering & Manufacturing Corp., Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 06/27/2024 | | | | 671 | | | | 674,780 | |
RGIS Services, LLC, | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 7.50%) | | | 9.15 | % | | | 03/31/2023 | | | | 410 | | | | 390,824 | |
Term Loan (3 mo. USD LIBOR + 7.50%) | | | 9.19 | % | | | 03/31/2023 | | | | 89 | | | | 84,962 | |
Term Loan (6 mo. USD LIBOR + 7.50%) | | | 9.23 | % | | | 03/31/2023 | | | | 315 | | | | 300,000 | |
Safe Fleet Holdings LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.78 | % | | | 02/03/2025 | | | | 326 | | | | 327,495 | |
Second Lien Term Loan (3 mo. USD LIBOR + 6.75%) | | | 8.53 | % | | | 02/01/2026 | | | | 187 | | | | 188,915 | |
| | | | | | | | | | | | | | | | 3,140,654 | |
| | |
| Containers & Glass Products–2.40% | | | | | | | | | |
Berlin Packaging, LLC, | | | | | | | | | | | | | | | | |
Second Lien Term Loan (1 mo. USD LIBOR + 6.75%) | | | 8.33 | % | | | 09/30/2022 | | | | 435 | | | | 439,291 | |
Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.85 | % | | | 10/01/2021 | | | | 464 | | | | 467,497 | |
Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.89 | % | | | 10/01/2021 | | | | 276 | | | | 277,668 | |
Berry Plastics Corp., | | | | | | | | | | | | | | | | |
Term Loan Q (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 10/01/2022 | | | | 152 | | | | 152,544 | |
Term Loan Q (3 mo. USD LIBOR + 2.00%) | | | 3.62 | % | | | 10/01/2022 | | | | 98 | | | | 98,353 | |
Term Loan R (1 mo. USD LIBOR + 2.00%) | | | 3.58 | % | | | 01/19/2024 | | | | 531 | | | | 533,417 | |
Berry Plastics Group, Inc., | | | | | | | | | | | | | | | | |
Term Loan O (1 mo. USD LIBOR + 2.00%) | | | 3.58 | % | | | 02/08/2020 | | | | 95 | | | | 95,612 | |
Term Loan P (1 mo. USD LIBOR + 2.00%) | | | 3.58 | % | | | 01/06/2021 | | | | 155 | | | | 156,107 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
15 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Containers & Glass Products–(continued) | | | | | | | | | |
BWAY Holding Co., Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.96 | % | | | 04/03/2024 | | | $ | 365 | | | $ | 367,189 | |
Consolidated Container Co. LLC, First Lien Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 05/22/2024 | | | | 792 | | | | 797,425 | |
Crown Americas LLC, Term Loan B | | | 0.00 | % | | | 01/29/2025 | | | | 327 | | | | 330,082 | |
Duran Group (Germany), Term Loan B-2 (3 mo. USD LIBOR + 4.00%)
(Acquired 03/24/2017; Cost $2,493,750)(e) | | | 5.71 | % | | | 03/21/2024 | | | | 2,522 | | | | 2,534,364 | |
Fort Dearborn Holding Co., Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.70 | % | | | 10/19/2023 | | | | 882 | | | | 882,785 | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.50%)(e) | | | 10.20 | % | | | 10/19/2024 | | | | 166 | | | | 159,160 | |
Hoffmaster Group, Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.50%) | | | 6.19 | % | | | 11/21/2023 | | | | 1,472 | | | | 1,488,450 | |
Klockner Pentaplast of America, Inc., | | | | | | | | | | | | | | | | |
Term Loan (3 mo. EURIBOR + 4.75%) | | | 4.75 | % | | | 06/30/2022 | | | EUR | 302 | | | | 362,820 | |
Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 06/30/2022 | | | | 897 | | | | 885,419 | |
Multi-Color Corp., Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 10/31/2024 | | | | 350 | | | | 352,414 | |
Ranpak Corp., | | | | | | | | | | | | | | | | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.25%) | | | 8.84 | % | | | 10/03/2022 | | | | 145 | | | | 146,299 | |
Term Loan B-1 (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 10/01/2021 | | | | 410 | | | | 412,699 | |
Refresco Group, N.V. (Netherlands), | | | | | | | | | | | | | | | | |
Term Loan B (3 mo. USD LIBOR + 2.75%) | | | 4.59 | % | | | 01/26/2025 | | | | 571 | | | | 572,170 | |
Term Loan B-1(f) | | | — | | | | 12/15/2024 | | | EUR | 445 | | | | 542,653 | |
Term Loan B-3(f) | | | — | | | | 12/15/2024 | | | | 578 | | | | 582,855 | |
Reynolds Group Holdings Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 02/05/2023 | | | | 3,155 | | | | 3,173,018 | |
Tekni-Plex, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-1 (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 10/17/2024 | | | | 345 | | | | 346,768 | |
Term Loan B-2 (3 mo. EURIBOR + 3.50%) | | | 3.50 | % | | | 10/17/2024 | | | EUR | 158 | | | | 194,466 | |
TricorBraun Inc., | | | | | | | | | | | | | | | | |
First Lien Delayed Draw Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.39 | % | | | 11/30/2023 | | | | 126 | | | | 126,983 | |
Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.44 | % | | | 11/30/2023 | | | | 1,251 | | | | 1,260,286 | |
| | | | | | | | | | | | | | | | 17,738,794 | |
| | |
| Cosmetics & Toiletries–1.10% | | | | | | | | | |
Alphabet Holding Co., Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 09/26/2024 | | | | 1,174 | | | | 1,134,605 | |
Coty Inc., Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.08 | % | | | 10/27/2022 | | | | 1,190 | | | | 1,197,555 | |
Galleria Co., Term Loan B (1 mo. USD LIBOR + 3.00%) | | | 4.63 | % | | | 09/29/2023 | | | | 2,678 | | | | 2,697,900 | |
Parfums Holding Co., Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.75%) | | | 6.44 | % | | | 06/30/2024 | | | | 1,468 | | | | 1,488,772 | |
Prestige Brands, Inc., Term Loan B-4 (1 mo. USD LIBOR + 2.50%) | | | 4.40 | % | | | 01/26/2024 | | | | 1,629 | | | | 1,641,742 | |
| | | | | | | | | | | | | | | | 8,160,574 | |
| | |
| Drugs–1.32% | | | | | | | | | |
BPA Laboratories, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 04/29/2020 | | | | 2,466 | | | | 2,404,677 | |
Second Lien Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 04/29/2020 | | | | 2,144 | | | | 1,983,643 | |
Catalent Pharma Solutions, Inc., Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 05/20/2024 | | | | 89 | | | | 89,335 | |
Endo LLC, Term Loan (1 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 04/27/2024 | | | | 3,356 | | | | 3,354,855 | |
Valeant Pharmaceuticals International, Inc. (Canada), Term Loan B F-4
(1 mo. USD LIBOR + 3.50%) | | | 5.08 | % | | | 04/01/2022 | | | | 1,895 | | | | 1,919,592 | |
| | | | | | | | | | | | | | | | 9,752,102 | |
| | |
| Ecological Services & Equipment–0.89% | | | | | | | | | |
Advanced Disposal Services Inc., Term Loan (1 wk. USD LIBOR + 2.25%) | | | 3.72 | % | | | 11/10/2023 | | | | 2,927 | | | | 2,941,937 | |
Casella Waste Systems, Inc., Term Loan B-1 (1 mo. USD LIBOR + 2.50%) | | | 4.09 | % | | | 10/17/2023 | | | | 462 | | | | 463,757 | |
Charah, LLC, | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 6.25%) | | | 7.90 | % | | | 10/25/2024 | | | | 16 | | | | 15,824 | |
Term Loan (2 mo. USD LIBOR + 6.25%) | | | 8.04 | % | | | 10/25/2024 | | | | 200 | | | | 202,550 | |
Term Loan (3 mo. USD LIBOR + 6.25%) | | | 8.18 | % | | | 10/25/2024 | | | | 618 | | | | 625,582 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
16 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Ecological Services & Equipment–(continued) | | | | | | | | | |
Gopher Resource, LLC, Term Loan(f) | | | — | | | | 02/09/2025 | | | $ | 159 | | | $ | 160,376 | |
WCA Waste Systems Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 08/11/2023 | | | | 873 | | | | 875,262 | |
Wrangler Buyer Corp., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 09/28/2024 | | | | 1,304 | | | | 1,312,412 | |
| | | | | | | | | | | | | | | | 6,597,700 | |
| | |
| Electronics & Electrical–12.68% | | | | | | | | | |
4L Technologies Inc., Term Loan (1 mo. USD LIBOR + 4.50%) | | | 6.15 | % | | | 05/08/2020 | | | | 2,654 | | | | 2,109,671 | |
Almonde, Inc. (United Kingdom), | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. EURIBOR + 3.25%) | | | 4.25 | % | | | 06/13/2024 | | | EUR | 758 | | | | 932,744 | |
First Lien Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.48 | % | | | 06/13/2024 | | | | 3,241 | | | | 3,243,493 | |
Applied Systems, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 09/19/2024 | | | | 657 | | | | 661,847 | |
Second Lien Term Loan (3 mo. USD LIBOR + 7.00%) | | | 8.69 | % | | | 09/19/2025 | | | | 58 | | | | 60,076 | |
Barracuda Networks, Inc., First Lien Term Loan (3 mo. USD LIBOR + 3.25%) | | | 5.06 | % | | | 02/12/2025 | | | | 505 | | | | 508,228 | |
Blackboard Inc., Term Loan B-4 (3 mo. USD LIBOR + 5.00%) | | | 6.73 | % | | | 06/30/2021 | | | | 2,856 | | | | 2,779,007 | |
BMC Software Finance, Inc., Term Loan B-2 (3 mo. EURIBOR + 3.75%) | | | 3.75 | % | | | 09/10/2022 | | | EUR | 114 | | | | 140,252 | |
Canyon Valor Companies, Inc., First Lien Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 06/16/2023 | | | | 1,517 | | | | 1,529,035 | |
Cavium, Inc., Term Loan B-1 (1 mo. USD LIBOR + 2.25%)(e) | | | 3.90 | % | | | 08/16/2022 | | | | 252 | | | | 252,781 | |
Compuware Corp., Term Loan B-3 (2 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/15/2021 | | | | 866 | | | | 878,329 | |
CPI International, Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 07/26/2024 | | | | 401 | | | | 402,837 | |
Dell International LLC, Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 09/07/2023 | | | | 1,586 | | | | 1,587,876 | |
Diebold Nixdorf, Inc., Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.38 | % | | | 11/06/2023 | | | | 1,782 | | | | 1,785,665 | |
DigiCert Holdings, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 4.75%) | | | 6.52 | % | | | 10/31/2024 | | | | 1,799 | | | | 1,822,380 | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.00%) | | | 9.77 | % | | | 10/31/2025 | | | | 293 | | | | 297,318 | |
Epicor Software Corp., Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 06/01/2022 | | | | 165 | | | | 166,014 | |
Go Daddy Operating Co., LLC, Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 02/15/2024 | | | | 1,866 | | | | 1,871,902 | |
Hyland Software, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 07/01/2022 | | | | 569 | | | | 573,473 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.00%) | | | 8.65 | % | | | 07/07/2025 | | | | 83 | | | | 85,583 | |
I-Logic Technologies Bidco Ltd. (United Kingdom), | | | | | | | | | | | | | | | | |
Term Loan(f) | | | — | | | | 12/20/2024 | | | EUR | 180 | | | | 221,729 | |
Term Loan(f) | | | — | | | | 12/21/2024 | | | | 704 | | | | 709,058 | |
IGT Holding IV AB (Sweden), Term Loan B(f) | | | — | | | | 07/26/2024 | | | | 1,040 | | | | 1,042,896 | |
Integrated Device Technology, Inc., Term Loan B (1 mo. USD LIBOR + 3.00%)
(Acquired 04/04/2017; Cost $689,680)(e) | | | 4.65 | % | | | 04/04/2024 | | | | 691 | | | | 695,086 | |
Kemet Corp., Term Loan (1 mo. USD LIBOR + 6.00%)
(Acquired 04/21/2017; Cost $1,066,157)(e) | | | 7.65 | % | | | 04/26/2024 | | | | 1,096 | | | | 1,116,703 | |
Lattice Semiconductor Corp., Term Loan (1 mo. USD LIBOR + 4.25%)(e) | | | 5.83 | % | | | 03/10/2021 | | | | 1,610 | | | | 1,629,864 | |
Lully Finance LLC, | | | | | | | | | | | | | | | | |
Second Lien Term Loan B-1 (1 mo. USD LIBOR + 8.50%)(e) | | | 10.12 | % | | | 10/16/2023 | | | | 731 | | | | 725,027 | |
Second Lien Term Loan B-2 (1 mo. EURIBOR + 7.25%)
(Acquired 11/30/2016; Cost $241,682)(e) | | | 7.25 | % | | | 10/16/2023 | | | EUR | 228 | | | | 272,638 | |
MA Finance Co., LLC, | | | | | | | | | | | | | | | | |
Term Loan B-2 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 11/19/2021 | | | | 3,753 | | | | 3,754,808 | |
Term Loan B-3 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 06/21/2024 | | | | 819 | | | | 822,786 | |
MACOM Technology Solutions Holdings, Inc., Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 05/17/2024 | | | | 1,113 | | | | 1,100,988 | |
McAfee, LLC, | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 4.50%) | | | 6.15 | % | | | 09/30/2024 | | | | 1,470 | | | | 1,479,657 | |
Term Loan (3 mo. EURIBOR + 4.25%) | | | 4.25 | % | | | 09/30/2024 | | | EUR | 537 | | | | 659,562 | |
Mediaocean LLC, First Lien Term Loan (1 mo. USD LIBOR + 4.25%) | | | 5.90 | % | | | 08/15/2022 | | | | 1,696 | | | | 1,708,799 | |
Micro Holding, L.P., Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.34 | % | | | 09/13/2024 | | | | 1,200 | | | | 1,202,030 | |
Micron Technology, Inc., Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 04/26/2022 | | | | 48 | | | | 47,918 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
17 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Electronics & Electrical–(continued) | | | | | | | | | |
Mirion Technologies, Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.75%) | | | 6.44 | % | | | 03/31/2022 | | | $ | 1,069 | | | $ | 1,066,932 | |
MTS Systems, Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.84 | % | | | 07/05/2023 | | | | 1,051 | | | | 1,061,249 | |
NeuStar, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-1 (2 mo. USD LIBOR + 3.25%) | | | 4.92 | % | | | 01/08/2020 | | | | 329 | | | | 329,820 | |
Term Loan B-2 (2 mo. USD LIBOR + 3.75%) | | | 5.42 | % | | | 08/08/2024 | | | | 1,702 | | | | 1,707,834 | |
Oberthur Technologies of America Corp., | | | | | | | | | | | | | | | | |
Term Loan B (3 mo. EURIBOR + 3.75%) | | | 3.75 | % | | | 01/10/2024 | | | EUR | 1,015 | | | | 1,230,754 | |
Term Loan B-1 (3 mo. USD LIBOR + 3.75%) | | | 5.44 | % | | | 01/10/2024 | | | | 1,280 | | | | 1,274,709 | |
OEConnection LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 4.00%)(e) | | | 5.69 | % | | | 11/22/2024 | | | | 768 | | | | 769,757 | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.00%)
(Acquired 11/22/2017; Cost $193,385)(e) | | | 9.69 | % | | | 11/22/2025 | | | | 195 | | | | 195,312 | |
Omnitracs, Inc., Second Lien Term Loan (3 mo. USD LIBOR + 7.75%) | | | 9.45 | % | | | 05/25/2021 | | | | 131 | | | | 131,997 | |
ON Semiconductor Corp., Term Loan B-2 (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 03/31/2023 | | | | 75 | | | | 75,889 | |
Optiv Inc., | | | | | | | | | | | | | | | | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.25%) | | | 8.88 | % | | | 01/31/2025 | | | | 417 | | | | 388,162 | |
Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.88 | % | | | 02/01/2024 | | | | 2,008 | | | | 1,918,960 | |
Project Accelerate Parent, LLC, First Lien Term Loan (3 mo. USD LIBOR + 4.25%)(e) | | | 5.94 | % | | | 01/02/2025 | | | | 687 | | | | 696,087 | |
Project Leopard Holdings, Inc., Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.78 | % | | | 07/07/2023 | | | | 726 | | | | 731,092 | |
Quest Software US Holdings Inc., Term Loan (3 mo. USD LIBOR + 5.50%) | | | 7.27 | % | | | 10/31/2022 | | | | 4,514 | | | | 4,600,611 | |
Ramundsen Holdings, LLC, | | | | | | | | | | | | | | | | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.50%) | | | 10.19 | % | | | 01/31/2025 | | | | 98 | | | | 99,644 | |
Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 02/01/2024 | | | | 245 | | | | 247,218 | |
Riverbed Technology, Inc., Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 04/24/2022 | | | | 1,874 | | | | 1,851,045 | |
Rocket Software, Inc., | | | | | | | | | | | | | | | | |
Second Lien Term Loan (3 mo. USD LIBOR + 9.50%) | | | 11.19 | % | | | 10/14/2024 | | | | 412 | | | | 417,740 | |
Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 10/14/2023 | | | | 2,087 | | | | 2,110,487 | |
Sandvine Corp., Term Loan B (3 mo. USD LIBOR + 5.75%) | | | 7.32 | % | | | 09/21/2022 | | | | 1,267 | | | | 1,266,830 | |
Seattle Spinco, Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 06/21/2024 | | | | 5,534 | | | | 5,556,476 | |
SS&C Technologies, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-3(f) | | | — | | | | 02/28/2025 | | | | 5,990 | | | | 6,026,974 | |
Term Loan B-4(f) | | | — | | | | 02/28/2025 | | | | 2,137 | | | | 2,150,019 | |
Sybil Software LLC, Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.44 | % | | | 09/30/2023 | | | | 4,128 | | | | 4,160,208 | |
Symantec Corp., Term Loan A-5 (2 mo. USD LIBOR + 1.75%) | | | 3.39 | % | | | 08/01/2021 | | | | 447 | | | | 447,845 | |
TIBCO Software, Inc., Term Loan B-1 (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/04/2020 | | | | 470 | | | | 471,580 | |
TTM Technologies, Inc., | | | | | | | | | | | | | | | | |
Incremental Term Loan(e)(f) | | | — | | | | 09/28/2024 | | | | 1,850 | | | | 1,861,331 | |
Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 09/28/2024 | | | | 197 | | | | 197,497 | |
VeriFone Inc., Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 01/31/2025 | | | | 185 | | | | 186,025 | |
Verint Systems Inc., Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.58 | % | | | 06/29/2024 | | | | 357 | | | | 358,263 | |
Veritas US Inc., | | | | | | | | | | | | | | | | |
Term Loan (3 mo. EURIBOR + 4.50%) | | | 5.50 | % | | | 01/27/2023 | | | EUR | 4,723 | | | | 5,782,091 | |
Term Loan B (3 mo. USD LIBOR + 4.50%) | | | 6.19 | % | | | 01/27/2023 | | | | 1,615 | | | | 1,609,062 | |
VF Holding Corp., Term Loan B-1 (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 06/30/2023 | | | | 1,327 | | | | 1,341,327 | |
Viewpoint, Inc., Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 07/19/2024 | | | | 505 | | | | 506,520 | |
Wall Street Systems Delaware, Inc., Term Loan (2 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 11/21/2024 | | | | 674 | | | | 676,232 | |
Xperi Corp., Term Loan B-1 (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 12/01/2023 | | | | 1,478 | | | | 1,487,702 | |
| | | | | | | | | | | | | | | | 93,869,341 | |
| | |
| Financial Intermediaries–1.20% | | | | | | | | | |
GEO Group, Inc., Term Loan (3 mo. USD LIBOR + 2.25%) | | | 3.95 | % | | | 03/23/2024 | | | | 763 | | | | 767,500 | |
iPayment Inc., Term Loan (3 mo. USD LIBOR + 5.00%) | | | 6.62 | % | | | 04/11/2023 | | | | 1,088 | | | | 1,099,922 | |
LPL Holdings, Inc., Incremental Term Loan B (3 mo. USD LIBOR + 2.25%) | | | 3.81 | % | | | 09/23/2024 | | | | 201 | | | | 201,281 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
18 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Financial Intermediaries–(continued) | | | | | | | | | |
MoneyGram International, Inc., Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 03/27/2020 | | | $ | 3,853 | | | $ | 3,852,795 | |
RJO Holdings Corp., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 12.00%) (Acquired 04/12/2017; Cost $441,976)(e) | | | 13.65 | % | | | 05/05/2022 | | | | 442 | | | | 444,186 | |
Term Loan (1 mo. USD LIBOR + 8.02%) (Acquired 04/12/2017; Cost $1,243,058)(e) | | | 9.67 | % | | | 05/05/2022 | | | | 1,243 | | | | 1,249,273 | |
Stiphout Finance LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 10/26/2022 | | | | 142 | | | | 143,031 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.25%) | | | 8.90 | % | | | 10/26/2023 | | | | 22 | | | | 22,074 | |
TMF Group Holdco B.V., Term Loan B (1 mo. EURIBOR + 3.50%) | | | 3.50 | % | | | 10/13/2023 | | | EUR | 882 | | | | 1,076,827 | |
| | | | | | | | | | | | | | | | 8,856,889 | |
| | |
| Food & Drug Retailers–1.12% | | | | | | | | | |
Adria Group Holding B.V. (Netherlands), Term Loan(h) | | | 0.00 | % | | | 06/04/2018 | | | EUR | 2,986 | | | | 60,719 | |
Albertsons LLC, | | | | | | | | | | | | | | | | |
Term Loan B-4 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 08/25/2021 | | | | 4,610 | | | | 4,556,103 | |
Term Loan B-5 (3 mo. USD LIBOR + 3.00%) | | | 4.67 | % | | | 12/21/2022 | | | | 1,040 | | | | 1,028,313 | |
Term Loan B-6 (3 mo. USD LIBOR + 3.00%) | | | 4.96 | % | | | 06/22/2023 | | | | 1,156 | | | | 1,140,308 | |
Supervalu Inc., | | | | | | | | | | | | | | | | |
Delayed Draw Term Loan B (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 06/08/2024 | | | | 579 | | | | 575,381 | |
Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 06/08/2024 | | | | 966 | | | | 958,968 | |
| | | | | | | | | | | | | | | | 8,319,792 | |
| | |
| Food Products–2.38% | | | | | | | | | |
Chefs’ Warehouse Parent, LLC, Term Loan (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 06/22/2022 | | | | 857 | | | | 865,606 | |
CSM Bakery Supplies LLC, First Lien Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.70 | % | | | 07/03/2020 | | | | 802 | | | | 795,977 | |
Dole Food Co., Inc., Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.36 | % | | | 04/06/2024 | | | | 2,914 | | | | 2,929,623 | |
Hearthside Group Holdings, LLC, | | | | | | | | | | | | | | | | |
Revolver Loan(d)(e) | | | 0.00 | % | | | 06/02/2019 | | | | 1,570 | | | | 1,564,815 | |
Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 06/02/2021 | | | | 573 | | | | 576,318 | |
Jacobs Douwe Egberts International B.V., Term Loan B-5 (3 mo. USD LIBOR + 2.25%) | | | 4.06 | % | | | 07/04/2022 | | | | 63 | | | | 63,078 | |
JBS USA Lux S.A., Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.10 | % | | | 10/30/2022 | | | | 8,247 | | | | 8,217,410 | |
Nomad Foods US LLC (United Kingdom), Term Loan B-4 (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 05/15/2024 | | | | 989 | | | | 993,311 | |
Post Holdings, Inc., Incremental Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 05/24/2024 | | | | 949 | | | | 951,478 | |
Shearer’s Foods, LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.94%) | | | 5.63 | % | | | 06/30/2021 | | | | 443 | | | | 446,332 | |
Second Lien Term Loan (3 mo. USD LIBOR + 6.75%) | | | 8.44 | % | | | 06/30/2022 | | | | 250 | | | | 235,450 | |
| | | | | | | | | | | | | | | | 17,639,398 | |
| | |
| Food Service–2.54% | | | | | | | | | |
EG Finco Ltd. (Netherlands), | | | | | | | | | | | | | | | | |
Term Loan B(f) | | | — | | | | 02/06/2025 | | | | 407 | | | | 407,914 | |
Term Loan B-1(f) | | | — | | | | 02/06/2025 | | | EUR | 584 | | | | 712,125 | |
Term Loan B-2(f) | | | — | | | | 02/06/2025 | | | EUR | 175 | | | | 213,211 | |
Term Loan B-3(d) | | | 0.00 | % | | | 02/06/2025 | | | EUR | 469 | | | | 469,484 | |
IRB Holding Corp., Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.83 | % | | | 02/05/2025 | | | | 1,556 | | | | 1,573,876 | |
NPC International, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (2 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 04/19/2024 | | | | 1,093 | | | | 1,105,667 | |
Second Lien Term Loan (2 mo. USD LIBOR + 7.50%) | | | 9.15 | % | | | 04/18/2025 | | | | 346 | | | | 351,651 | |
Red Lobster Management, LLC, First Lien Term Loan (1 mo. USD LIBOR + 5.25%) | | | 6.90 | % | | | 07/28/2021 | | | | 317 | | | | 318,755 | |
Restaurant Holding Co., LLC, First Lien Term Loan (1 mo. USD LIBOR + 7.75%)(e) | | | 9.40 | % | | | 02/28/2019 | | | | 1,093 | | | | 1,087,213 | |
Steak ’n Shake Inc., Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 03/19/2021 | | | | 1,002 | | | | 892,113 | |
Tacala Investment Corp., | | | | | | | | | | | | | | | | |
First Lien Term Loan(f) | | | — | | | | 01/26/2025 | | | | 528 | | | | 531,780 | |
Second Lien Term Loan(f) | | | — | | | | 01/26/2026 | | | | 310 | | | | 317,010 | |
TKC Holdings, Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.25%) | | | 6.03 | % | | | 02/01/2023 | | | | 1,653 | | | | 1,673,466 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
19 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Food Service–(continued) | | | | | | | | | |
TMK Hawk Parent, Corp., Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 09/26/2024 | | | $ | 1,061 | | | $ | 1,068,468 | |
US Foods, Inc., Term Loan (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 06/27/2023 | | | | 6,698 | | | | 6,759,228 | |
Weight Watchers International, Inc., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 4.75%) | | | 6.33 | % | | | 11/29/2024 | | | | 242 | | | | 245,339 | |
Term Loan (3 mo. USD LIBOR + 4.75%) | | | 6.43 | % | | | 11/29/2024 | | | | 1,042 | | | | 1,057,493 | |
| | | | | | | | | | | | | | | | 18,784,793 | |
| | |
| Health Care–4.33% | | | | | | | | | |
Acadia Healthcare Co., Inc., | | | | | | | | | | | | | | | | |
Term Loan B-1 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 02/11/2022 | | | | 735 | | | | 740,870 | |
Term Loan B-2 (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 02/16/2023 | | | | 953 | | | | 960,095 | |
Air Medical Group Holdings, Inc., Term Loan(f) | | | — | | | | 09/30/2024 | | | | 1,304 | | | | 1,319,991 | |
Argon Medical Devices Holdings, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.75%)(e) | | | 5.40 | % | | | 01/23/2025 | | | | 320 | | | | 321,668 | |
Second Lien Term Loan (1 mo. USD LIBOR + 8.00%) | | | 9.65 | % | | | 01/23/2026 | | | | 76 | | | | 77,020 | |
ATI Holdings, Inc., First Lien Term Loan (3 mo. USD LIBOR + 3.50%)(e) | | | 5.20 | % | | | 05/10/2023 | | | | 562 | | | | 568,450 | |
Community Health Systems, Inc., | | | | | | | | | | | | | | | | |
Incremental Term Loan G (3 mo. USD LIBOR + 2.75%) | | | 4.73 | % | | | 12/31/2019 | | | | 224 | | | | 222,802 | |
Revolver Loan(d)(e) | | | 0.00 | % | | | 01/27/2019 | | | | 843 | | | | 824,325 | |
Convatec Inc., Term Loan B (3 mo. USD LIBOR + 2.25%) | | | 3.94 | % | | | 10/31/2023 | | | | 266 | | | | 267,340 | |
Diplomat Pharmacy, Inc., Term Loan B (1 mo. USD LIBOR + 4.50%) | | | 6.10 | % | | | 12/20/2024 | | | | 779 | | | | 787,231 | |
DJO Finance LLC, | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 06/07/2020 | | | | 1,520 | | | | 1,508,903 | |
Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.92 | % | | | 06/07/2020 | | | | 1,548 | | | | 1,536,441 | |
Envision Healthcare Corp., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 12/01/2023 | | | | 538 | | | | 540,630 | |
Explorer Holdings, Inc., Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.52 | % | | | 05/02/2023 | | | | 1,235 | | | | 1,246,516 | |
Global Healthcare Exchange, LLC, Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 06/30/2024 | | | | 849 | | | | 853,738 | |
Greatbatch Ltd., Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.83 | % | | | 10/27/2022 | | | | 1,115 | | | | 1,126,613 | |
HC Group Holdings III, Inc., First Lien Term Loan (1 mo. USD LIBOR + 5.00%)(e) | | | 6.65 | % | | | 04/07/2022 | | | | 1,524 | | | | 1,553,024 | |
INC Research Holdings, Inc., Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 08/01/2024 | | | | 165 | | | | 165,336 | |
IWH UK Midco Ltd. (United Kingdom), Term Loan B (2 mo. EURIBOR + 4.00%) | | | 4.00 | % | | | 10/20/2024 | | | EUR | 411 | | | | 504,373 | |
Kinetic Concepts, Inc., Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 02/03/2024 | | | | 2,974 | | | | 2,987,335 | |
MPH Acquisition Holdings LLC, Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 06/07/2023 | | | | 4,941 | | | | 4,970,184 | |
Nidda Healthcare Holding AG (Germany), Term Loan B-1(d) | | | 0.00 | % | | | 08/21/2024 | | | GBP | 239 | | | | 238,601 | |
Ortho-Clinical Diagnostics, Inc., Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.44 | % | | | 06/30/2021 | | | | 1,009 | | | | 1,018,273 | |
PAREXEL International Corp., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 09/27/2024 | | | | 3,105 | | | | 3,106,988 | |
Pearl Intermediate Parent LLC, | | | | | | | | | | | | | | | | |
First Lien Delayed Draw Term Loan(d) | | | 0.00 | % | | | 02/01/2025 | | | | 76 | | | | 75,044 | |
First Lien Term Loan(f) | | | — | | | | 02/01/2025 | | | | 257 | | | | 255,149 | |
Quintiles IMS Inc., Term Loan B-2 (3 mo. USD LIBOR + 2.00%) | | | 3.69 | % | | | 01/17/2025 | | | | 72 | | | | 72,136 | |
Surgery Center Holdings, Inc., Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 08/31/2024 | | | | 743 | | | | 743,803 | |
Team Health Holdings, Inc., Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 02/06/2024 | | | | 1,967 | | | | 1,920,510 | |
Unilabs Diagnostics AB (Sweden), Revolver Loan(d)(e) | | | 0.00 | % | | | 03/12/2021 | | | EUR | 926 | | | | 926,446 | |
WP CityMD Bidco LLC, Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.69 | % | | | 06/07/2024 | | | | 579 | | | | 581,397 | |
| | | | | | | | | | | | | | | | 32,021,232 | |
| | |
| Home Furnishings–0.99% | | | | | | | | | |
Comfort Holding, LLC, First Lien Term Loan (1 mo. USD LIBOR + 4.75%) | | | 6.33 | % | | | 02/05/2024 | | | | 1,044 | | | | 1,020,741 | |
Global Appliance Inc., Term Loan B (1 mo. USD LIBOR + 4.00%) | | | 5.65 | % | | | 09/29/2024 | | | | 1,267 | | | | 1,284,885 | |
Hayward Industries, Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 08/05/2024 | | | | 580 | | | | 583,182 | |
Hilding Anders International AB (Sweden), Term Loan B(f) | | | — | | | | 11/30/2024 | | | EUR | 387 | | | | 475,673 | |
Lifetime Brands, Inc., Term Loan B(e)(f) | | | — | | | | 03/31/2025 | | | | 394 | | | | 396,964 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
20 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Home Furnishings–(continued) | | | | | | | | | |
Serta Simmons Bedding, LLC, First Lien Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.22 | % | | | 11/08/2023 | | | $ | 2,460 | | | $ | 2,384,176 | |
TGP Holdings III, LLC, | | | | | | | | | | | | | | | | |
First Lien Delayed Draw Term Loan(d) | | | 0.00 | % | | | 09/25/2024 | | | | 131 | | | | 130,545 | |
First Lien Term Loan (3 mo. USD LIBOR + 5.00%) | | | 6.69 | % | | | 09/25/2024 | | | | 821 | | | | 830,148 | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.50%)
(Acquired 09/21/2017; Cost $235,354) | | | 10.19 | % | | | 09/25/2025 | | | | 239 | | | | 242,395 | |
| | | | | | | | | | | | | | | | 7,348,709 | |
| | |
| Industrial Equipment–3.16% | | | | | | | | | |
Accudyne Industries LLC, Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 08/18/2024 | | | | 1,465 | | | | 1,475,803 | |
CIRCOR International, Inc., Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.08 | % | | | 12/11/2024 | | | | 1,609 | | | | 1,619,007 | |
Clark Equipment Co., Term Loan B (3 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 05/18/2024 | | | | 2,286 | | | | 2,295,410 | |
Columbus McKinnon Corp., Term Loan B-2 (1 mo. USD LIBOR + 2.50%) | | | 4.12 | % | | | 01/31/2024 | | | | 337 | | | | 338,812 | |
Crosby US Acquisition Corp., First Lien Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.90 | % | | | 11/23/2020 | | | | 1,673 | | | | 1,647,173 | |
DXP Enterprises, Inc., Term Loan (1 mo. USD LIBOR + 5.50%)
(Acquired 08/17/2017; Cost $509,562)(e) | | | 7.15 | % | | | 08/29/2023 | | | | 514 | | | | 520,814 | |
Engineered Machinery Holdings, Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 07/19/2024 | | | | 447 | | | | 449,101 | |
Second Lien Delayed Draw Term Loan(d) | | | 0.00 | % | | | 07/18/2025 | | | | 6 | | | | 5,568 | |
Second Lien Delayed Draw Term Loan (3 mo. USD LIBOR + 7.25%) | | | 8.67 | % | | | 07/18/2025 | | | | 29 | | | | 29,231 | |
Second Lien Term Loan (3 mo. USD LIBOR + 7.25%) | | | 8.94 | % | | | 07/18/2025 | | | | 289 | | | | 292,310 | |
Filtration Group Corp., First Lien Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.98 | % | | | 11/23/2020 | | | | 2,183 | | | | 2,208,030 | |
Gardner Denver, Inc., Term Loan B-1 (3 mo. USD LIBOR + 2.75%) | | | 4.44 | % | | | 07/30/2024 | | | | 1,685 | | | | 1,693,006 | |
Generac Power Systems, Inc., Term Loan (3 mo. USD LIBOR + 2.00%) | | | 3.69 | % | | | 05/31/2023 | | | | 352 | | | | 353,279 | |
LSFX Flavum Bidco (Spain), Term Loan B (3 mo. EURIBOR + 4.50%) | | | 4.50 | % | | | 10/03/2024 | | | EUR | 508 | | | | 613,973 | |
Milacron LLC, Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.40 | % | | | 09/25/2023 | | | | 1,190 | | | | 1,195,337 | |
MX Holdings US, Inc., Term Loan B-1-B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 08/14/2023 | | | | 996 | | | | 1,001,095 | |
New VAC US LLC, Term Loan B(f) | | | — | | | | 02/26/2025 | | | | 428 | | | | 428,353 | |
North American Lifting Holdings, Inc., First Lien Term Loan (3 mo. USD LIBOR + 4.50%) | | | 6.19 | % | | | 11/27/2020 | | | | 1,263 | | | | 1,195,113 | |
Pro Mach Group, Inc., Term Loan B(f) | | | — | | | | 03/07/2025 | | | | 1,236 | | | | 1,241,819 | |
Rexnord LLC, Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.85 | % | | | 08/21/2024 | | | | 113 | | | | 113,807 | |
Robertshaw US Holding Corp., | | | | | | | | | | | | | | | | |
First Lien Term Loan(f) | | | — | | | | 02/28/2025 | | | | 882 | | | | 891,439 | |
Second Lien Term Loan(f) | | | — | | | | 02/28/2026 | | | | 388 | | | | 387,398 | |
Tank Holding Corp., Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.93 | % | | | 03/16/2022 | | | | 594 | | | | 595,565 | |
Terex Corp., Term Loan (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 01/31/2024 | | | | 516 | | | | 518,356 | |
Vantiv, LLC, | | | | | | | | | | | | | | | | |
Incremental Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.59 | % | | | 08/07/2024 | | | | 2,209 | | | | 2,225,450 | |
Term Loan B-3 (1 mo. USD LIBOR + 2.00%) | | | 3.59 | % | | | 10/14/2023 | | | | 13 | | | | 13,277 | |
| | | | | | | | | | | | | | | | 23,348,526 | |
| | |
| Insurance–0.97% | | | | | | | | | |
Alliant Holdings I, L.P., Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 08/12/2022 | | | | 238 | | | | 239,343 | |
AmWINS Group, LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.38 | % | | | 01/25/2024 | | | | 821 | | | | 826,382 | |
Second Lien Term Loan (1 mo. USD LIBOR + 6.75%) | | | 8.40 | % | | | 01/25/2025 | | | | 143 | | | | 144,960 | |
Hub International Ltd., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.84 | % | | | 10/02/2020 | | | | 1,406 | | | | 1,413,556 | |
Sedgwick Claims Management Services, Inc., First Lien Term Loan(f) | | | — | | | | 03/01/2021 | | | | 1,563 | | | | 1,564,771 | |
USI Inc., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 05/16/2024 | | | | 2,982 | | | | 2,982,746 | |
| | | | | | | | | | | | | | | | 7,171,758 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
21 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Leisure Goods, Activities & Movies–4.24% | | | | | | | | | |
Alpha Topco Ltd. (United Kingdom), Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 02/01/2024 | | | $ | 7,242 | | | $ | 7,236,183 | |
AMC Entertainment Inc., | | | | | | | | | | | | | | | | |
Incremental Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 12/15/2023 | | | | 1,289 | | | | 1,293,813 | |
Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.84 | % | | | 12/15/2022 | | | | 940 | | | | 943,933 | |
Ancestry.com Operations Inc., First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 10/19/2023 | | | | 824 | | | | 829,724 | |
Bright Horizons Family Solutions, Inc., Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 11/07/2023 | | | | 58 | | | | 58,410 | |
Cinemark USA, Inc., Term Loan (3 mo. USD LIBOR + 2.00%) | | | 3.59 | % | | | 05/09/2022 | | | | 128 | | | | 128,902 | |
Crown Finance US, Inc., Term Loan B(f) | | | — | | | | 02/07/2025 | | | | 5,473 | | | | 5,473,233 | |
CWGS Group, LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.58 | % | | | 11/23/2023 | | | | 2,380 | | | | 2,405,088 | |
Cyan Blue Holdco 3 Ltd. (Jersey), Term Loan B-2 (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 08/23/2024 | | | | 1,057 | | | | 1,061,479 | |
Dorna Sports, S.L. (Spain), Term Loan B2 (6 mo. USD LIBOR + 3.25%) | | | 5.09 | % | | | 04/12/2024 | | | | 854 | | | | 851,812 | |
Equinox Holdings, Inc., | | | | | | | | | | | | | | | | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.00%) | | | 8.65 | % | | | 09/06/2024 | | | | 132 | | | | 136,858 | |
Term Loan B-1 (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 03/08/2024 | | | | 1,171 | | | | 1,181,499 | |
Fitness International, LLC, Term Loan B (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 07/01/2020 | | | | 1,617 | | | | 1,637,039 | |
Lakeland Tours, LLC, | | | | | | | | | | | | | | | | |
Delayed Draw Term Loan(d) | | | 0.00 | % | | | 12/16/2024 | | | | 55 | | | | 55,232 | |
Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.59 | % | | | 12/16/2024 | | | | 662 | | | | 670,675 | |
MTL Publishing LLC, Term Loan B-6 (3 mo. USD LIBOR + 2.25%) | | | 3.98 | % | | | 08/20/2023 | | | | 1,586 | | | | 1,593,189 | |
Orbiter International S.a.r.l. (Luxembourg), Term Loan B-2 (3 mo. CHF LIBOR + 4.25%) | | | 4.25 | % | | | 07/11/2024 | | | CHF | 369 | | | | 392,752 | |
Sabre GLBL Inc., Incremental Term Loan B-1 (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 02/22/2024 | | | | 114 | | | | 114,549 | |
Shutterfly, Inc., | | | | | | | | | | | | | | | | |
Incremental Term Loan(f) | | | — | | | | 08/17/2024 | | | | 1,085 | | | | 1,092,502 | |
Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.10 | % | | | 08/17/2024 | | | | 461 | | | | 461,813 | |
UFC Holdings, LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 08/18/2023 | | | | 3,216 | | | | 3,236,966 | |
Second Lien Term Loan (1 mo. USD LIBOR + 7.50%) | | | 9.15 | % | | | 08/18/2024 | | | | 525 | | | | 537,311 | |
| | | | | | | | | | | | | | | | 31,392,962 | |
| | |
| Lodging & Casinos–4.78% | | | | | | | | | |
B&B Hotels S.A.S. (France), Term Loan B (3 mo. EURIBOR + 3.25%) | | | 3.25 | % | | | 03/14/2023 | | | EUR | 1,024 | | | | 1,256,336 | |
Belmond Interfin Ltd. (Bermuda), Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 07/03/2024 | | | | 1,395 | | | | 1,401,689 | |
Boyd Gaming Corp., Term Loan B (1 wk. USD LIBOR + 2.50%) | | | 3.97 | % | | | 09/15/2023 | | | | 199 | | | | 199,832 | |
Caesars Entertainment Operating Co., LLC, Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 04/04/2024 | | | | 230 | | | | 231,368 | |
Caesars Resort Collection, LLC, Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 12/23/2024 | | | | 7,804 | | | | 7,864,994 | |
CityCenter Holdings, LLC, Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 04/18/2024 | | | | 755 | | | | 759,196 | |
Four Seasons Hotels Ltd. (Canada), Term Loan (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 11/30/2023 | | | | 1,168 | | | | 1,177,762 | |
Golden Nugget, Inc., | | | | | | | | | | | | | | | | |
First Lien Incremental Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 10/04/2023 | | | | 4 | | | | 4,330 | |
First Lien Incremental Term Loan (2 mo. USD LIBOR + 3.25%) | | | 5.04 | % | | | 10/04/2023 | | | | 957 | | | | 966,227 | |
First Lien Incremental Term Loan (3 mo. USD LIBOR + 3.25%) | | | 4.98 | % | | | 10/04/2023 | | | | 732 | | | | 738,614 | |
La Quinta Intermediate Holdings LLC, Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.47 | % | | | 04/14/2021 | | | | 3,995 | | | | 4,018,524 | |
Las Vegas Sands, LLC/Venetian Casino Resort, LLC, Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 03/29/2024 | | | | 11 | | | | 11,452 | |
RHP Hotel Properties, L.P., Term Loan B (3 mo. USD LIBOR + 2.25%) | | | 4.07 | % | | | 05/11/2024 | | | | 127 | | | | 128,354 | |
Scientific Games International, Inc., | | | | | | | | | | | | | | | | |
Multicurrency Revolver Loan (Acquired 04/29/2016-10/04/2017; Cost $2,099,631)(d)(e) | | | 0.00 | % | | | 10/18/2018 | | | | 2,186 | | | | 2,169,702 | |
Multicurrency Revolver Loan (1 mo. USD LIBOR + 3.00%)
(Acquired 04/29/2016-10/04/2017; Cost $865,134)(e) | | | 1.71 | % | | | 10/18/2018 | | | | 901 | | | | 894,006 | |
Revolver Loan (Acquired 10/04/2017; Cost $995,322)(d)(e) | | | 0.00 | % | | | 10/18/2018 | | | | 1,003 | | | | 995,179 | |
Term Loan B-5 (2 mo. USD LIBOR + 2.75%) | | | 4.45 | % | | | 08/14/2024 | | | | 6,281 | | | | 6,316,761 | |
Station Casinos LLC, Term Loan B (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 06/08/2023 | | | | 2,576 | | | | 2,584,203 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
22 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Lodging & Casinos–(continued) | | | | | | | | | |
Twin River Management Group, Inc., Term Loan (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 07/10/2020 | | | $ | 2,763 | | | $ | 2,797,684 | |
VICI Properties 1 LLC, Term Loan B (1 mo. USD LIBOR + 2.00%) | | | 3.60 | % | | | 12/20/2024 | | | | 821 | | | | 826,140 | |
| | | | | | | | | | | | | | | | 35,342,353 | |
| | |
| Nonferrous Metals & Minerals–0.23% | | | | | | | | | |
American Rock Salt Co. LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 05/20/2021 | | | | 546 | | | | 547,053 | |
First Lien Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 05/20/2021 | | | | 202 | | | | 202,357 | |
Dynacast International LLC, | | | | | | | | | | | | | | | | |
First Lien Term Loan B-2 (3 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 01/28/2022 | | | | 927 | | | | 936,429 | |
Second Lien Term Loan (3 mo. USD LIBOR + 8.50%)
(Acquired 01/29/2015; Cost $15,163)(e) | | | 10.19 | % | | | 01/30/2023 | | | | 15 | | | | 15,429 | |
| | | | | | | | | | | | | | | | 1,701,268 | |
| | |
| Oil & Gas–6.71% | | | | | | | | | |
Ascent Resources — Marcellus, LLC, First Lien Term Loan (Prime Rate + 3.25%) | | | 7.75 | % | | | 08/04/2020 | | | | 3,021 | | | | 1,770,035 | |
BCP Raptor, LLC, Term Loan (2 mo. USD LIBOR + 4.25%) | | | 6.04 | % | | | 06/24/2024 | | | | 1,448 | | | | 1,460,778 | |
BCP Renaissance Parent LLC, Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.77 | % | | | 10/31/2024 | | | | 2,436 | | | | 2,460,369 | |
Bronco Midstream Funding, LLC, Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.87 | % | | | 08/17/2020 | | | | 2,255 | | | | 2,283,710 | |
California Resources Corp., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 10.38%) | | | 11.97 | % | | | 12/31/2021 | | | | 623 | | | | 707,389 | |
Term Loan (1 mo. USD LIBOR + 4.75%) | | | 6.34 | % | | | 12/31/2022 | | | | 1,687 | | | | 1,714,301 | |
Citgo Petroleum Corp., Term Loan B (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 07/29/2021 | | | | 1,349 | | | | 1,345,941 | |
Crestwood Holdings LLC, | | | | | | | | | | | | | | | | |
Term Loan(f) | | | — | | | | 03/05/2023 | | | | 1,990 | | | | 1,950,644 | |
Term Loan B-1 (1 mo. USD LIBOR + 8.00%) | | | 9.59 | % | | | 06/19/2019 | | | | 1,942 | | | | 1,946,779 | |
Fieldwood Energy LLC, | | | | | | | | | | | | | | | | |
Second Lien Term Loan(h)(i) | | | 0.00 | % | | | 09/30/2020 | | | | 1,369 | | | | 280,729 | |
Term Loan (3 mo. USD LIBOR + 2.88%)(i) | | | 4.57 | % | | | 10/01/2018 | | | | 147 | | | | 146,833 | |
Term Loan (3 mo. USD LIBOR + 7.00%)(i) | | | 8.69 | % | | | 08/31/2020 | | | | 3,280 | | | | 3,272,726 | |
Floatel International Ltd., Term Loan (3 mo. USD LIBOR + 5.00%) | | | 6.69 | % | | | 06/27/2020 | | | | 3,493 | | | | 2,908,188 | |
Glass Mountain Pipeline Holdings, LLC, Term Loan (3 mo. USD LIBOR + 4.50%) | | | 6.16 | % | | | 12/23/2024 | | | | 1,041 | | | | 1,045,223 | |
Gulf Finance, LLC, Term Loan B (3 mo. USD LIBOR + 5.25%) | | | 6.95 | % | | | 08/25/2023 | | | | 3,395 | | | | 3,117,669 | |
HGIM Corp., Term Loan B (Prime Rate + 3.50%) | | | 8.00 | % | | | 06/18/2020 | | | | 3,789 | | | | 1,591,382 | |
Lucid Energy Group II Borrower, LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.59 | % | | | 02/17/2025 | | | | 940 | | | | 943,124 | |
Medallion Midland Acquisition, LLC, Term Loan (1 mo. USD LIBOR + 3.25%)(e) | | | 4.90 | % | | | 10/30/2024 | | | | 797 | | | | 800,215 | |
Navitas Midstream Midland Basin, LLC, Term Loan (1 mo. USD LIBOR + 4.50%)(e) | | | 6.09 | % | | | 12/13/2024 | | | | 1,204 | | | | 1,205,607 | |
Ocean Rig 1 Inc., Term Loan | | | 8.00 | % | | | 09/20/2024 | | | | 681 | | | | 709,337 | |
Osum Production Corp. (Canada), Term Loan (3 mo. USD LIBOR + 5.50%) | | | 7.19 | % | | | 07/31/2020 | | | | 2,096 | | | | 1,781,966 | |
Pacific Drilling S.A. (Luxembourg), Term Loan(h)(i) | | | 0.00 | % | | | 06/03/2018 | | | | 692 | | | | 280,444 | |
Paragon Offshore Finance Co. (Cayman Islands), | | | | | | | | | | | | | | | | |
PIK Term Loan, 6.73% PIK Rate, 1.00% Cash Rate(g)(i) | | | 1.00 | % | | | 07/18/2022 | | | | 93 | | | | 79,521 | |
Term Loan (Acquired 07/11/2014; Cost $11,863)(e)(h)(i) | | | 6.25 | % | | | 07/16/2021 | | | | 12 | | | | 0 | |
Petroleum GEO-Services ASA, Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 03/19/2021 | | | | 4,587 | | | | 4,257,928 | |
Seadrill Operating L.P., Term Loan (3 mo. USD LIBOR + 6.00%) | | | 4.69 | % | | | 02/21/2021 | | | | 6,930 | | | | 6,025,556 | |
Southcross Energy Partners, L.P., Term Loan (3 mo. USD LIBOR + 4.25%) | | | 5.94 | % | | | 08/04/2021 | | | | 1,041 | | | | 1,031,707 | |
Traverse Midstream Partners LLC, Term Loan (6 mo. USD LIBOR + 4.00%) | | | 5.85 | % | | | 09/27/2024 | | | | 1,505 | | | | 1,517,955 | |
Veresen Midstream US LLC, Term Loan B-3 (3 mo. USD LIBOR + 3.00%) | | | 4.69 | % | | | 03/31/2022 | | | | 984 | | | | 991,019 | |
Weatherford International Ltd. (Bermuda), Term Loan (1 mo. USD LIBOR + 2.30%) | | | 3.95 | % | | | 07/13/2020 | | | | 2,085 | | | | 2,069,338 | |
| | | | | | | | | | | | | | | | 49,696,413 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
23 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Publishing–1.55% | | | | | | | | | |
Ascend Learning, LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 07/12/2024 | | | $ | 1,020 | | | $ | 1,025,082 | |
Merrill Communications LLC, Term Loan (3 mo. USD LIBOR + 5.25%) | | | 7.02 | % | | | 06/01/2022 | | | | 31 | | | | 30,840 | |
Nielsen Finance LLC, Term Loan B-4 (1 mo. USD LIBOR + 2.00%) | | | 3.58 | % | | | 10/04/2023 | | | | 4,552 | | | | 4,570,339 | |
ProQuest LLC, Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 10/24/2021 | | | | 1,069 | | | | 1,084,690 | |
Southern Graphics, Inc., Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/31/2022 | | | | 1,231 | | | | 1,243,992 | |
Tribune Media Co., Term Loan C (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 01/27/2024 | | | | 3,492 | | | | 3,500,193 | |
| | | | | | | | | | | | | | | | 11,455,136 | |
| | |
| Radio & Television–3.40% | | | | | | | | | |
E.W. Scripps Co., Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 10/02/2024 | | | | 441 | | | | 443,813 | |
Gray Television, Inc., Term Loan B-2 (1 mo. USD LIBOR + 2.25%) | | | 3.83 | % | | | 02/07/2024 | | | | 66 | | | | 66,428 | |
iHeartCommunications, Inc., | | | | | | | | | | | | | | | | |
Term Loan D (3 mo. USD LIBOR + 6.75%) | | | 8.44 | % | | | 01/30/2019 | | | | 6,757 | | | | 5,395,251 | |
Term Loan E (3 mo. USD LIBOR + 7.50%) | | | 9.19 | % | | | 07/30/2019 | | | | 11,492 | | | | 9,178,460 | |
Mission Broadcasting, Inc., Term Loan B-2 (1 mo. USD LIBOR + 2.50%)(f) | | | — | | | | 01/17/2024 | | | | 1 | | | | 139 | |
Nexstar Broadcasting, Inc., Term Loan B-2 (1 mo. USD LIBOR + 2.50%)(f) | | | — | | | | 01/17/2024 | | | | 1 | | | | 1,097 | |
Raycom TV Broadcasting, LLC, Term Loan B-1 (1 mo. USD LIBOR + 2.25%) | | | 3.87 | % | | | 08/23/2024 | | | | 1,275 | | | | 1,279,541 | |
Sinclair Television Group, Inc., | | | | | | | | | | | | | | | | |
Term Loan B(f) | | | — | | | | 12/12/2024 | | | | 8,302 | | | | 8,330,160 | |
Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.90 | % | | | 01/03/2024 | | | | 503 | | | | 504,229 | |
| | | | | | | | | | | | | | | | 25,199,118 | |
| | |
| Retailers (except Food & Drug)–3.13% | | | | | | | | | |
Bass Pro Group, LLC, Term Loan (1 mo. USD LIBOR + 5.00%) | | | 6.65 | % | | | 09/25/2024 | | | | 2,842 | | | | 2,838,888 | |
BJ’s Wholesale Club, Inc., Term Loan B (1 mo. USD LIBOR + 3.50%) | | | 5.08 | % | | | 02/03/2024 | | | | 566 | | | | 565,831 | |
CVS Holdings I, LP, | | | | | | | | | | | | | | | | |
First Lien Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.79 | % | | | 02/06/2025 | | | | 552 | | | | 550,687 | |
Second Lien Term Loan (3 mo. USD LIBOR + 6.75%) | | | 8.54 | % | | | 02/06/2026 | | | | 181 | | | | 180,888 | |
David’s Bridal, Inc., Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.70 | % | | | 10/11/2019 | | | | 952 | | | | 815,001 | |
Fullbeauty Brands Holdings Corp., Term Loan (1 mo. USD LIBOR + 4.75%) | | | 6.40 | % | | | 10/14/2022 | | | | 2,049 | | | | 1,201,490 | |
J. Crew Group, Inc., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 3.22%) | | | 4.84 | % | | | 03/05/2021 | | | | 148 | | | | 103,775 | |
Term Loan (3 mo. USD LIBOR + 3.22%) | | | 4.88 | % | | | 03/05/2021 | | | | 225 | | | | 157,100 | |
Lands’ End, Inc., Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.82 | % | | | 04/02/2021 | | | | 2,425 | | | | 2,246,199 | |
Moran Foods LLC, Term Loan (1 mo. USD LIBOR + 6.00%) | | | 7.65 | % | | | 12/05/2023 | | | | 1,365 | | | | 1,218,103 | |
National Vision, Inc., | | | | | | | | | | | | | | | | |
Revolver Loan(d)(e) | | | 0.00 | % | | | 03/13/2019 | | | | 1,250 | | | | 1,149,948 | |
Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 11/20/2024 | | | | 499 | | | | 502,381 | |
Payless Inc., | | | | | | | | | | | | | | | | |
Term Loan A-1 (3 mo. USD LIBOR + 8.00%) | | | 9.54 | % | | | 02/10/2022 | | | | 880 | | | | 873,825 | |
Term Loan A-2 (3 mo. USD LIBOR + 9.00%) | | | 10.54 | % | | | 08/10/2022 | | | | 1,651 | | | | 1,532,904 | |
Petco Animal Supplies, Inc., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.77 | % | | | 01/26/2023 | | | | 2,633 | | | | 1,842,914 | |
Savers Inc., Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.49 | % | | | 07/09/2019 | | | | 3,676 | | | | 3,530,200 | |
Staples, Inc., Term Loan (3 mo. USD LIBOR + 4.00%) | | | 5.79 | % | | | 09/12/2024 | | | | 2,009 | | | | 1,999,100 | |
Toys ’R’ Us-Delaware, Inc., | | | | | | | | | | | | | | | | |
Term Loan B-2 (Prime Rate + 2.75%)(i) | | | 7.25 | % | | | 05/25/2018 | | | | 153 | | | | 49,457 | |
Term Loan B-3 (Prime Rate + 2.75%)(i) | | | 7.25 | % | | | 05/25/2018 | | | | 20 | | | | 6,312 | |
Vivarte (France), PIK Term Loan, 7.00% PIK Rate, 4.00% Cash Rate(g) | | | 4.00 | % | | | 10/29/2019 | | | EUR | 1,593 | | | | 1,797,196 | |
| | | | | | | | | | | | | | | | 23,162,199 | |
| | |
| Steel–0.23% | | | | | | | | | |
Atkore International, Inc., First Lien Incremental Term Loan (3 mo. USD LIBOR + 2.75%) | | | 4.45 | % | | | 12/22/2023 | | | | 1,052 | | | | 1,060,539 | |
Phoenix Services International, LLC, Term Loan B(f) | | | — | | | | 01/30/2025 | | | | 661 | | | | 668,506 | |
| | | | | | | | | | | | | | | | 1,729,045 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
24 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Surface Transport–1.27% | | | | | | | | | |
Agro Merchants North American Holdings, Inc, First Lien Term Loan
(1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 12/06/2024 | | | $ | 521 | | | $ | 527,174 | |
Commercial Barge Line Co., First Lien Term Loan(f) | | | — | | | | 11/12/2020 | | | | 330 | | | | 196,437 | |
Kenan Advantage Group, Inc., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 07/29/2022 | | | | 565 | | | | 567,979 | |
Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 07/29/2022 | | | | 2,301 | | | | 2,312,191 | |
Odyssey Logistics & Technology Corp., Term Loan (1 mo. USD LIBOR + 4.25%) (Acquired 10/06/2017; Cost $636,843) | | | 5.90 | % | | | 10/12/2024 | | | | 640 | | | | 648,706 | |
PODS LLC, Term Loan B-3 (1 mo. USD LIBOR + 3.00%) | | | 4.58 | % | | | 12/06/2024 | | | | 2,633 | | | | 2,653,901 | |
U.S. Shipping Corp., Term Loan B-2 (1 mo. USD LIBOR + 4.25%) | | | 5.90 | % | | | 06/26/2021 | | | | 1,704 | | | | 1,540,199 | |
XPO Logistics, Inc., Term Loan B (3 mo. USD LIBOR + 2.00%) | | | 3.92 | % | | | 02/23/2025 | | | | 953 | | | | 956,859 | |
| | | | | | | | | | | | | | | | 9,403,446 | |
| | |
| Telecommunications–8.38% | | | | | | | | | |
CenturyLink, Inc., Term Loan B (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 01/31/2025 | | | | 7,360 | | | | 7,244,824 | |
Colorado Buyer Inc., Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.78 | % | | | 05/01/2024 | | | | 1,319 | | | | 1,327,733 | |
Communications Sales & Leasing, Inc., Term Loan B (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 10/24/2022 | | | | 4,859 | | | | 4,682,658 | |
Consolidated Communications, Inc., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 10/05/2023 | | | | 5,613 | | | | 5,533,991 | |
Frontier Communications Corp., | | | | | | | | | | | | | | | | |
Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.40 | % | | | 03/31/2021 | | | | 2,675 | | | | 2,655,059 | |
Term Loan A(e)(f) | | | — | | | | 10/12/2021 | | | | 65 | | | | 64,184 | |
GTT Communications, Inc., Term Loan B (1 mo. USD LIBOR + 3.25%) | | | 4.94 | % | | | 01/09/2024 | | | | 1,628 | | | | 1,641,858 | |
Hargray Communications Group, Inc., Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 05/16/2024 | | | | 372 | | | | 373,494 | |
Intelsat Jackson Holdings S.A., | | | | | | | | | | | | | | | | |
Term Loan B-3 (3 mo. USD LIBOR + 3.75%) | | | 5.71 | % | | | 11/30/2023 | | | | 71 | | | | 70,425 | |
Term Loan B-5 | | | 6.63 | % | | | 01/02/2024 | | | | 2,037 | | | | 2,049,983 | |
Level 3 Financing, Inc., Term Loan B (1 mo. USD LIBOR + 2.25%) | | | 3.85 | % | | | 02/22/2024 | | | | 6,316 | | | | 6,334,520 | |
MTN Infrastructure TopCo, Inc., | | | | | | | | | | | | | | | | |
Delayed Draw Term Loan(f) | | | — | | | | 11/17/2024 | | | | 675 | | | | 680,207 | |
Term Loan (1 mo. USD LIBOR + 3.25%) | | | 4.90 | % | | | 11/17/2024 | | | | 984 | | | | 993,504 | |
Radiate Holdco, LLC, Term Loan (1 mo. USD LIBOR + 3.00%) | | | 4.65 | % | | | 02/01/2024 | | | | 2,415 | | | | 2,413,776 | |
Sprint Communications Inc., Term Loan (1 mo. USD LIBOR + 2.50%) | | | 4.19 | % | | | 02/02/2024 | | | | 6,203 | | | | 6,215,367 | |
Syniverse Holdings, Inc., Term Loan C(f) | | | — | | | | 02/09/2023 | | | | 2,958 | | | | 2,986,268 | |
Telesat LLC, Term Loan B-4 (3 mo. USD LIBOR + 3.00%) | | | 4.70 | % | | | 11/17/2023 | | | | 6,558 | | | | 6,606,865 | |
U.S. Telepacific Corp., Term Loan (3 mo. USD LIBOR + 5.00%) | | | 6.69 | % | | | 05/02/2023 | | | | 3,052 | | | | 2,963,702 | |
Windstream Services, LLC, | | | | | | | | | | | | | | | | |
Term Loan B-6 (1 mo. USD LIBOR + 4.00%) | | | 5.59 | % | | | 03/29/2021 | | | | 4,700 | | | | 4,464,797 | |
Term Loan B-7 (1 mo. USD LIBOR + 3.25%) | | | 4.84 | % | | | 02/17/2024 | | | | 550 | | | | 490,531 | |
Zayo Group, LLC, | | | | | | | | | | | | | | | | |
Incremental Term Loan B-1 (1 mo. USD LIBOR + 2.00%) | | | 3.65 | % | | | 01/19/2021 | | | | 124 | | | | 124,254 | |
Term Loan B-2 (1 mo. USD LIBOR + 2.25%)(f) | | | — | | | | 01/19/2024 | | | | 2,123 | | | | 2,134,929 | |
| | | | | | | | | | | | | | | | 62,052,929 | |
| | |
| Utilities–9.21% | | | | | | | | | |
AES Corp., (The), Term Loan (3 mo. USD LIBOR + 2.00%) | | | 3.94 | % | | | 05/24/2022 | | | | 994 | | | | 996,332 | |
APLP Holdings L.P. (Canada), Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 04/13/2023 | | | | 677 | | | | 685,847 | |
Aria Energy Operating LLC, Term Loan (1 mo. USD LIBOR + 4.50%) | | | 6.15 | % | | | 05/27/2022 | | | | 697 | | | | 704,827 | |
Calpine Corp., | | | | | | | | | | | | | | | | |
Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.20 | % | | | 01/15/2023 | | | | 5,227 | | | | 5,257,401 | |
Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.20 | % | | | 05/31/2023 | | | | 2,794 | | | | 2,806,757 | |
Term Loan (3 mo. USD LIBOR + 2.50%) | | | 4.20 | % | | | 01/15/2024 | | | | 2,966 | | | | 2,976,743 | |
Compass Power Generation, Term Loan (3 mo. USD LIBOR + 3.75%) | | | 5.39 | % | | | 12/20/2024 | | | | 1,513 | | | | 1,529,467 | |
Dynegy Inc., Term Loan C-2 (1 mo. USD LIBOR + 2.75%) | | | 4.35 | % | | | 02/07/2024 | | | | 4,901 | | | | 4,936,867 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
25 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Utilities–(continued) | | | | | | | | | |
Eastern Power, LLC, Term Loan (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 10/02/2023 | | | $ | 2,227 | | | $ | 2,258,089 | |
Energy Future Intermediate Holding Co. LLC, DIP Term Loan (1 wk. USD LIBOR + 3.00%) | | | 4.47 | % | | | 06/30/2018 | | | | 5,307 | | | | 5,313,259 | |
ExGen Renewables IV, LLC, Term Loan (3 mo. USD LIBOR + 3.00%) | | | 4.99 | % | | | 11/28/2024 | | | | 1,018 | | | | 1,030,131 | |
Granite Acquisition Inc., | | | | | | | | | | | | | | | | |
First Lien Term Loan B (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 12/17/2021 | | | | 2,567 | | | | 2,603,379 | |
First Lien Term Loan C (3 mo. USD LIBOR + 3.50%) | | | 5.19 | % | | | 12/17/2021 | | | | 357 | | | | 362,340 | |
Second Lien Term Loan B (3 mo. USD LIBOR + 7.25%) | | | 8.94 | % | | | 12/19/2022 | | | | 592 | | | | 600,737 | |
Lightstone Holdco LLC, | | | | | | | | | | | | | | | | |
Term Loan B (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 01/30/2024 | | | | 3,531 | | | | 3,558,321 | |
Term Loan C (1 mo. USD LIBOR + 3.75%) | | | 5.40 | % | | | 01/30/2024 | | | | 224 | | | | 225,943 | |
Nautilus Power, LLC, Term Loan (1 mo. USD LIBOR + 4.25%) | | | 5.90 | % | | | 05/16/2024 | | | | 1,320 | | | | 1,340,887 | |
NRG Energy Inc., | | | | | | | | | | | | | | | | |
Revolver Loan A(d)(e) | | | 0.00 | % | | | 07/01/2018 | | | | 17,507 | | | | 17,461,071 | |
Term Loan (3 mo. USD LIBOR + 2.25%) | | | 3.94 | % | | | 06/30/2023 | | | | 2,176 | | | | 2,188,465 | |
Pike Corp., Term Loan (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 09/20/2024 | | | | 619 | | | | 626,028 | |
PowerTeam Services, LLC, First Lien Term Loan(f) | | | — | | | | 03/05/2025 | | | | 906 | | | | 903,357 | |
Southeast PowerGen LLC, Term Loan B (1 mo. USD LIBOR + 3.50%) | | | 5.15 | % | | | 12/02/2021 | | | | 644 | | | | 624,754 | |
TerraForm Power Operating, LLC, Term Loan (1 mo. USD LIBOR + 2.75%) | | | 4.33 | % | | | 11/08/2022 | | | | 285 | | | | 287,261 | |
USIC Holding, Inc., Term Loan B (3 mo. USD LIBOR + 3.50%) | | | 5.00 | % | | | 12/08/2023 | | | | 1,710 | | | | 1,724,073 | |
Vistra Operations Co. LLC, | | | | | | | | | | | | | | | | |
Incremental Term Loan (1 mo. USD LIBOR + 2.25%) | | | 3.85 | % | | | 12/14/2023 | | | | 261 | | | | 262,580 | |
Term Loan (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 08/04/2023 | | | | 5,807 | | | | 5,846,237 | |
Term Loan C (1 mo. USD LIBOR + 2.50%) | | | 4.15 | % | | | 08/04/2023 | | | | 1,029 | | | | 1,036,016 | |
| | | | | | | | | | | | | | | | 68,147,169 | |
Total Variable Rate Senior Loan Interests | | | | | | | | | | | | | | | 813,549,845 | |
| | |
Bonds & Notes–7.60% | | | | | | | | | |
| Air Transport–0.35% | | | | | | | | | | | | | | | | |
Mesa Airlines, Inc., Class B(j) | | | 5.75 | % | | | 07/15/2025 | | | | 2,612 | | | | 2,593,746 | |
| | |
| Automotive–0.28% | | | | | | | | | |
Federal-Mogul Holdings Corp. (3 mo. EURIBOR + 4.88%)(j)(k) | | | 4.88 | % | | | 04/15/2024 | | | EUR | 641 | | | | 788,472 | |
Federal-Mogul Holdings Corp.(j) | | | 5.00 | % | | | 07/15/2024 | | | EUR | 173 | | | | 205,020 | |
Schaeffler AG (Germany)(j) | | | 4.13 | % | | | 09/15/2021 | | | | 271 | | | | 271,000 | |
Schaeffler AG (Germany)(j) | | | 4.75 | % | | | 09/15/2026 | | | | 833 | | | | 805,927 | |
| | | | | | | | | | | | | | | | 2,070,419 | |
| | |
| Building & Development–0.02% | | | | | | | | | |
Haya Finance 2017 S.A. (Spain) (3 mo. EURIBOR + 5.13%)(j)(k) | | | 5.13 | % | | | 11/15/2022 | | | EUR | 100 | | | | 121,390 | |
| | |
| Business Equipment & Services–0.40% | | | | | | | | | |
Dream Secured Bondco AB (Sweden)(j) | | | 5.75 | % | | | 12/01/2023 | | | EUR | 1,178 | | | | 1,440,818 | |
ICBPI (United Kingdom) (6 mo. EURIBOR + 8.00%)(j)(k) | | | 8.00 | % | | | 05/30/2021 | | | EUR | 1,250 | | | | 1,543,605 | |
| | | | | | | | | | | | | | | | 2,984,423 | |
| | |
| Cable & Satellite Television–1.74% | | | | | | | | | |
Altice Financing S.A. (Luxembourg)(j) | | | 4.75 | % | | | 01/15/2028 | | | EUR | 419 | | | | 462,597 | |
Altice Financing S.A. (Luxembourg)(j) | | | 6.63 | % | | | 02/15/2023 | | | | 520 | | | | 520,650 | |
Altice Financing S.A. (Luxembourg)(j) | | | 7.50 | % | | | 05/15/2026 | | | | 3,966 | | | | 4,005,660 | |
Altice US Finance I Corp.(j) | | | 5.50 | % | | | 05/15/2026 | | | | 5,666 | | | | 5,623,505 | |
Numericable-SFR S.A. (France)(j) | | | 7.38 | % | | | 05/01/2026 | | | | 1,020 | | | | 988,431 | |
Telenet Financing USD LLC(j) | | | 3.50 | % | | | 03/01/2028 | | | EUR | 400 | | | | 480,143 | |
UPC Financing Partnership(j) | | | 3.63 | % | | | 06/15/2029 | | | EUR | 235 | | | | 280,923 | |
Virgin Media Bristol LLC (United Kingdom)(j) | | | 5.50 | % | | | 08/15/2026 | | | | 554 | | | | 549,790 | |
| | | | | | | | | | | | | | | | 12,911,699 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
26 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Chemicals & Plastics–0.57% | | | | | | | | | |
Avantor Inc.(j) | | | 4.75 | % | | | 10/01/2024 | | | EUR | 628 | | | $ | 763,563 | |
Avantor Inc.(j) | | | 6.00 | % | | | 10/01/2024 | | | $ | 963 | | | | 965,407 | |
Hexion Specialty Chemicals, Inc. | | | 6.63 | % | | | 04/15/2020 | | | | 2,516 | | | | 2,352,273 | |
Perstorp Holding AB (Sweden)(j) | | | 10.00 | % | | | 12/15/2022 | | | EUR | 125 | | | | 158,254 | |
| | | | | | | | | | | | | | | | 4,239,497 | |
| | |
| Containers & Glass Products–0.40% | | | | | | | | | |
Ardagh Glass Finance PLC(j) | | | 4.25 | % | | | 09/15/2022 | | | | 504 | | | | 503,370 | |
Ardagh Glass Finance PLC(j) | | | 4.63 | % | | | 05/15/2023 | | | | 852 | | | | 854,130 | |
Reynolds Group Holdings Inc. | | | 5.75 | % | | | 10/15/2020 | | | | 576 | | | | 584,284 | |
Reynolds Group Holdings Inc. (3 mo. USD LIBOR + 3.50%)(j)(k) | | | 5.22 | % | | | 07/15/2021 | | | | 969 | | | | 982,324 | |
| | | | | | | | | | | | | | | | 2,924,108 | |
| | |
| Electronics & Electrical–0.46% | | | | | | | | | |
Blackboard Inc.(j) | | | 9.75 | % | | | 10/15/2021 | | | | 2,907 | | | | 2,645,370 | |
Dell International LLC(j) | | | 5.45 | % | | | 06/15/2023 | | | | 720 | | | | 760,927 | |
| | | | | | | | | | | | | | | | 3,406,297 | |
| | |
| Financial Intermediaries–0.50% | | | | | | | | | |
AnaCap Financial Europe S.A. (United Kingdom) (3 mo. EURIBOR + 5.00%)(j)(k) | | | 5.00 | % | | | 07/30/2024 | | | EUR | 200 | | | | 231,046 | |
Garfunkelux Holdco 3 S.A. (Luxembourg) (3 mo. EURIBOR + 3.50%)(j)(k) | | | 3.50 | % | | | 09/01/2023 | | | EUR | 467 | | | | 531,975 | |
Garfunkelux Holdco 3 S.A. (Luxembourg)(j) | | | 11.00 | % | | | 11/01/2023 | | | GBP | 876 | | | | 1,260,160 | |
Nassa Midco AS (Sweden)(j) | | | 2.88 | % | | | 04/06/2024 | | | EUR | 850 | | | | 1,049,933 | |
Nemean Bondco PLC (United Kingdom) (3 mo. GBP LIBOR + 6.50%)(j)(k) | | | 7.02 | % | | | 02/01/2023 | | | GBP | 491 | | | | 628,281 | |
| | | | | | | | | | | | | | | | 3,701,395 | |
| | |
| Health Care–0.98% | | | | | | | | | |
Care UK Health & Social Care PLC (United Kingdom) (3 mo. GBP LIBOR + 5.00%)(j)(k) | | | 5.52 | % | | | 07/15/2019 | | | GBP | 1,750 | | | | 2,403,201 | |
DJO Finance LLC(j) | | | 8.13 | % | | | 06/15/2021 | | | | 1,062 | | | | 1,035,450 | |
DJO Finance LLC | | | 10.75 | % | | | 04/15/2020 | | | | 3,085 | | | | 2,822,775 | |
IDH Finance PLC (United Kingdom) (3 mo. GBP LIBOR + 6.00%)(j)(k) | | | 6.55 | % | | | 08/15/2022 | | | GBP | 750 | | | | 955,890 | |
| | | | | | | | | | | | | | | | 7,217,316 | |
| | |
| Home Furnishings–0.28% | | | | | | | | | |
Shop Direct Funding PLC (United Kingdom)(j) | | | 7.75 | % | | | 11/15/2022 | | | GBP | 1,634 | | | | 2,103,924 | |
| | |
| Lodging & Casinos–0.30% | | | | | | | | | |
ESH Hospitality, Inc.(j) | | | 5.25 | % | | | 05/01/2025 | | | | 755 | | | | 755,000 | |
Scientific Games International, Inc.(j) | | | 3.38 | % | | | 02/15/2026 | | | EUR | 211 | | | | 252,475 | |
Travelodge Hotels Ltd. (United Kingdom) (3 mo. GBP LIBOR + 4.88%)(j)(k) | | | 5.42 | % | | | 05/15/2023 | | | GBP | 800 | | | | 1,101,943 | |
VICI Properties 1 LLC | | | 8.00 | % | | | 10/15/2023 | | | | 86 | | | | 96,309 | |
| | | | | | | | | | | | | | | | 2,205,727 | |
| | |
| Nonferrous Metals & Minerals–0.44% | | | | | | | | | |
TiZir Ltd. (United Kingdom)(j) | | | 9.50 | % | | | 07/19/2022 | | | | 3,050 | | | | 3,266,355 | |
| | |
| Oil & Gas–0.17% | | | | | | | | | |
Pacific Drilling S.A. (Luxembourg)(i)(j) | | | 5.38 | % | | | 06/01/2020 | | | | 2,928 | | | | 1,222,440 | |
| | |
| Radio & Television–0.35% | | | | | | | | | |
Clear Channel International B.V.(j) | | | 8.75 | % | | | 12/15/2020 | | | | 2,436 | | | | 2,557,800 | |
| | |
| Retailers (except Food & Drug)–0.07% | | | | | | | | | |
Claire’s Stores Inc.(j) | | | 6.13 | % | | | 03/15/2020 | | | | 780 | | | | 522,600 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
27 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | Value | |
| Telecommunications–0.26% | | | | | | | | | |
Communications Sales & Leasing, Inc.(j) | | | 6.00 | % | | | 04/15/2023 | | | $ | 623 | | | $ | 604,310 | |
Goodman Networks Inc. | | | 8.00 | % | | | 05/11/2022 | | | | 1,870 | | | | 1,308,718 | |
Windstream Services, LLC | | | 6.38 | % | | | 08/01/2023 | | | | 25 | | | | 14,750 | |
| | | | | | | | | | | | | | | | 1,927,778 | |
| | |
| Utilities–0.03% | | | | | | | | | |
Calpine Corp.(j) | | | 5.25 | % | | | 06/01/2026 | | | | 241 | | | | 234,674 | |
Total Bonds & Notes | | | | | | | | | | | | | | | 56,211,588 | |
| | | | |
| | | | | | | | | Shares | | | | |
Common Stocks & Other Equity Interests–7.09%(l) | | | | | | | | | |
| Aerospace & Defense–0.50% | | | | | | | | | | | | | | | | |
IAP Worldwide Services (Acquired 07/18/2014-08/18/2014; Cost $249,110)(e)(j)(m) | | | | | | | | | | | 229 | | | | 3,705,469 | |
| | |
| Automotive–0.03% | | | | | | | | | |
Transtar Holding Co., Class A (Acquired 04/11/2017; Cost $184,961)(e)(j)(m) | | | | | | | | | | | 2,935,894 | | | | 199,641 | |
| | |
| Building & Development–0.51% | | | | | | | | | |
BMC Stock Holdings, Inc.(m) | | | | | | | | | | | 129,856 | | | | 2,434,800 | |
Five Point Holdings LLC, Class A(m) | | | | | | | | | | | 98,198 | | | | 1,326,655 | |
Lake at Las Vegas Joint Venture, LLC, Class A
(Acquired 07/15/2010; Cost $7,938,060)(e)(j)(m) | | | | | | | | | | | 780 | | | | 0 | |
Lake at Las Vegas Joint Venture, LLC, Class B (Acquired 07/15/2010; Cost $93,975)(e)(j)(m) | | | | | | | | | | | 9 | | | | 0 | |
| | | | | | | | | | | | | | | | 3,761,455 | |
| | |
| Chemicals & Plastics–0.00% | | | | | | | | | |
Lyondell Chemical Co., Class A | | | | | | | | | | | 142 | | | | 15,367 | |
| | |
| Conglomerates–0.04% | | | | | | | | | |
Euramax International, Inc.(j)(m) | | | | | | | | | | | 3,272 | | | | 278,137 | |
| | |
| Cosmetics & Toiletries–0.10% | | | | | | | | | |
Levlad, LLC(e)(j)(m) | | | | | | | | | | | 4,893 | | | | 733,890 | |
| | |
| Drugs–0.00% | | | | | | | | | |
BPA Laboratories, Class A, Wts. expiring 04/29/2024
(Acquired 04/29/2014; Cost $0)(e)(j)(m) | | | | | | | | | | | 7,160 | | | | 0 | |
BPA Laboratories, Class B, Wts. expiring 04/29/2024
(Acquired 04/29/2014; Cost $0)(e)(j)(m) | | | | | | | | | | | 11,479 | | | | 0 | |
| | | | | | | | | | | | | | | | 0 | |
| | |
| Financial Intermediaries–0.00% | | | | | | | | | |
RJO Holdings Corp. (Acquired 12/10/2010; Cost $0)(e)(j)(m) | | | | | | | | | | | 2,852 | | | | 2,852 | |
RJO Holdings Corp., Class A (Acquired 12/10/2010; Cost $0)(e)(j)(m) | | | | | | | | | | | 2,314 | | | | 2,545 | |
RJO Holdings Corp., Class B (Acquired 12/10/2010; Cost $0)(e)(j)(m) | | | | | | | | | | | 3,000 | | | | 30 | |
| | | | | | | | | | | | | | | | 5,427 | |
| | |
| Forest Products–0.15% | | | | | | | | | |
Verso Corp., Class A(m) | | | | | | | | | | | 65,375 | | | | 1,146,677 | |
| | |
| Health Care–0.00% | | | | | | | | | |
New Millennium Holdco(j)(m) | | | | | | | | | | | 136,135 | | | | 13,477 | |
| | |
| Lodging & Casinos–2.96% | | | | | | | | | |
Caesars Entertainment Operating Co., LLC(m) | | | | | | | | | | | 35,315 | | | | 448,500 | |
Twin River Management Group, Inc.(j)(m) | | | | | | | | | | | 189,050 | | | | 21,457,175 | |
| | | | | | | | | | | | | | | | 21,905,675 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
28 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | | | | | | | Shares | | | Value | |
| Oil & Gas–0.99% | | | | | | | | | |
Ameriforge Group Inc.(j)(m) | | | | | | | | | | | 499 | | | $ | 22,954 | |
CJ Holding Co.(m) | | | | | | | | | | | 27,250 | | | | 654,000 | |
Ocean Rig 1 Inc.(m) | | | | | | | | | | | 118,969 | | | | 3,077,728 | |
Paragon Offshore Finance Co. (Cayman Islands)(i)(j)(m) | | | | | | | | | | | 2,645 | | | | 107,871 | |
Paragon Offshore Finance Co. (Cayman Islands), Class A(i)(j)(m) | | | | | | | | | | | 2,645 | | | | 3,439 | |
Paragon Offshore Finance Co. (Cayman Islands), Class B(i)(j)(m) | | | | | | | | | | | 1,323 | | | | 42,171 | |
Samson Investment Co.(j) | | | | | | | | | | | 144,254 | | | | 3,426,032 | |
| | | | | | | | | | | | | | | | 7,334,195 | |
| | |
| Publishing–0.77% | | | | | | | | | |
Affiliated Media, Inc., Class B (Acquired 10/03/2007; Cost $5,259,391)(e)(j)(m) | | | | | | | | | | | 81,915 | | | | 1,843,090 | |
Cygnus Business Media, Inc. (Acquired 07/19/2004; Cost $1,793,148)(e)(j)(m)(n) | | | | | | | | | | | 8,426 | | | | 0 | |
F&W Publications, Inc. (Acquired 06/09/2010; Cost $23,348)(e)(j)(m) | | | | | | | | | | | 18,385 | | | | 11,031 | |
MC Communications, LLC (Acquired 07/02/2009; Cost $0)(e)(j)(m) | | | | | | | | | | | 739,818 | | | | 0 | |
Merrill Communications LLC, Class A(j)(m) | | | | | | | | | | | 326,686 | | | | 3,756,889 | |
Tronc, Inc.(m) | | | | | | | | | | | 4,756 | | | | 90,983 | |
| | | | | | | | | | | | | | | | 5,701,993 | |
| | |
| Retailers (except Food & Drug)–0.06% | | | | | | | | | |
Payless Inc.(j)(m) | | | | | | | | | | | 83,461 | | | | 459,036 | |
Vivarte (France), Class A Preference Shares (Acquired 06/21/2017; Cost $0)(e)(j)(m) | | | | | | | | | | | 259 | | | | 0 | |
Vivarte (France), Class A Preference Shares (Acquired 06/21/2017; Cost $0)(e)(j)(m) | | | | | | | | | | | 259 | | | | 0 | |
| | |
| Telecommunications–0.01% | | | | | | | | | |
CTM Media Holdings Inc.(m) | | | | | | | | | | | 1,270 | | | | 54,610 | |
Goodman Networks Inc.(e)(m) | | | | | | | | | | | 117,618 | | | | 0 | |
| | | | | | | | | | | | | | | | 54,610 | |
| | |
| Utilities–0.97% | | | | | | | | | |
Vistra Operations Co. LLC(m) | | | | | | | | | | | 357,798 | | | | 6,780,272 | |
Vistra Operations Co. LLC(e)(j)(m) | | | | | | | | | | | 585,868 | | | | 169,902 | |
Vistra Operations Co. LLC, Rts. expiring 12/31/2046(j)(m) | | | | | | | | | | | 357,798 | | | | 256,541 | |
| | | | | | | | | | | | | | | | 7,206,715 | |
Total Common Stocks & Other Equity Interests | | | | | | | | | | | | | | | 52,521,764 | |
| | | | |
| | | Interest Rate | | | Maturity Date | | | Principal Amount (000)(a) | | | | |
Structured Products–1.28% | | | | | | | | | |
Apidos CLO X, Series 2012-10A, Class E (3 mo. USD LIBOR + 6.25%)(j)(k) | | | 8.02 | % | | | 10/30/2022 | | | $ | 610 | | | | 612,698 | |
Atrium X LLC, Series 2013-10A, Class E (3 mo. USD LIBOR + 4.50%)(j)(k) | | | 6.22 | % | | | 07/16/2025 | | | | 251 | | | | 251,141 | |
Clontarf Park CLO (Ireland), Series 2017-1A, Class D (3 mo. EURIBOR + 5.10%)(j)(k) | | | 5.10 | % | | | 08/05/2030 | | | EUR | 136 | | | | 167,464 | |
ING Investment Management CLO IV, Ltd., Series 2007-4A, Class D
(3 mo. USD LIBOR + 4.25%)(j)(k) | | | 5.99 | % | | | 06/14/2022 | | | | 542 | | | | 544,324 | |
Madison Park Funding XIV, Ltd., Series 2014-14A, Class F (3 mo. USD LIBOR + 5.40%)(j)(k) | | | 7.14 | % | | | 07/20/2026 | | | | 1,075 | | | | 1,051,799 | |
NewStar Berkeley Fund CLO LLC, Series 2016-1A, Class D (3 mo. USD LIBOR + 5.10%)(j)(k) | | | 6.85 | % | | | 10/25/2028 | | | | 1,220 | | | | 1,230,380 | |
OCP Euro CLO (Ireland), Series 2017-2, Class E (3 mo. EURIBOR + 5.00%)(j)(k) | | | 5.00 | % | | | 01/15/2032 | | | EUR | 153 | | | | 187,721 | |
Octagon Investment Partners XIX Ltd., Series 2014-1A, Class E
(3 mo. USD LIBOR + 4.85%)(j)(k) | | | 6.57 | % | | | 04/15/2026 | | | | 1,741 | | | | 1,716,039 | |
Octagon Investment Partners XVIII Ltd., Series 2013-1A, Class D
(3 mo. USD LIBOR + 5.25%)(j)(k) | | | 7.10 | % | | | 12/16/2024 | | | | 1,575 | | | | 1,595,997 | |
Symphony CLO VIII, Ltd., Series 2012-8A, Class ER (3 mo. USD LIBOR + 6.00%)(j)(k) | | | 7.70 | % | | | 01/09/2023 | | | | 2,140 | | | | 2,152,367 | |
Total Structured Products | | | | | | | | | | | | | | | 9,509,930 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
29 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | |
| | | | | | | | | Shares | | | Value | |
Preferred Stocks–0.04%(l) | | | | | | | | | |
| Financial Intermediaries–0.00% | | | | | | | | | | | | | | | | |
RJO Holdings Corp. (Acquired 12/10/2010; Cost $0)(e)(j)(m) | | | | | | | | | | | 584 | | | $ | 5,840 | |
| | |
| Retailers (except Food & Drug)–0.00% | | | | | | | | | |
Vivarte (France), Class A (Acquired 06/21/2017; Cost $0)(e)(j)(m) | | | | | | | | | | | 7,780 | | | | 0 | |
| | |
| Telecommunications–0.03% | | | | | | | | | |
Goodman Networks Inc. (Acquired 05/31/2017; Cost $1,399)(e)(j)(m) | | | | | | | | | | | 139,938 | | | | 209,907 | |
| | |
| Utilities–0.01% | | | | | | | | | |
Genie Energy Ltd. (Acquired 01/29/2004; Cost $165,021) | | | | | | | | | | | 7,632 | | | | 55,332 | |
Total Preferred Stocks | | | | | | | | | | | | | | | 271,079 | |
TOTAL INVESTMENTS IN SECURITIES(o)–125.92% (Cost $944,430,343) | | | | | | | | | | | | | | | 932,064,206 | |
BORROWINGS–(22.97)% | | | | | | | | | | | | | | | (170,000,000 | ) |
OTHER ASSETS LESS LIABILITIES–(2.95)% | | | | | | | | | | | | (21,876,443 | ) |
NET ASSETS–100.00% | | | | | | | | | | | $ | 740,187,763 | |
Investment Abbreviations:
| | |
| CHF | | – Swiss Franc |
| CLO | | – Collateralized Loan Obligation |
| DIP | | – Debtor-in-Possession |
| EUR | | – Euro |
| EURIBOR | | – Euro Interbank Offered Rate |
| GBP | | – British Pound Sterling |
| LIBOR | | – London Interbank Offered Rate |
| PIK | | – Pay-in-Kind |
| Rts. | | – Rights |
| USD | | – U.S. Dollar |
| Wts. | | – Warrants |
Notes to Schedule of Investments:
| (a) | Foreign denominated security. Principal amount is denominated in the currency indicated. |
| (b) | Variable rate senior loan interests are, at present, not readily marketable, not registered under the Securities Act of 1933, as amended (the “1933 Act”), and may be subject to contractual and legal restrictions on sale. Variable rate senior loan interests in the Fund’s portfolio generally have variable rates which adjust to a base, such as the LIBOR, on set dates, typically every 30 days but not greater than one year; and/or have interest rates that float at a margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank. |
| (c) | Variable rate senior loan interests often require prepayments from excess cash flow or permit the borrower to repay at its election. The degree to which borrowers repay, whether as a contractual requirement or at their election, cannot be predicted with accuracy. As a result, the actual remaining maturity may be substantially less than the stated maturities shown. However, it is anticipated that the variable rate senior loan interests will have an expected average life of three to five years. |
| (d) | All or a portion of this holding is subject to unfunded loan commitments. Interest rate will be determined at the time of funding. See Note 9. |
| (e) | Security valued using significant unobservable inputs (Level 3). See Note 3. |
| (f) | This variable rate interest will settle after February 28, 2018, at which time the interest rate will be determined. |
| (g) | All or a portion of this security is Pay-in-Kind. Pay-in-Kind securities pay interest income in the form of securities. |
| (h) | Defaulted security. Currently, the issuer is partially or fully in default with respect to principal and/or interest payments. The aggregate value of these securities at February 28, 2018 was $621,892, which represented less than 1% of the Fund’s Net Assets. |
| (i) | The borrower has filed for protection in federal bankruptcy court. |
| (j) | Security purchased or received in a transaction exempt from registration under the 1933 Act. The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at February 28, 2018 was $95,250,328, which represented 12.87% of the Fund’s Net Assets. |
| (k) | Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on February 28, 2018. |
| (l) | Acquired as part of a bankruptcy restructuring. |
| (m) | Non-income producing security. |
| (n) | Affiliated company during the period. The Investment Company Act of 1940 defines an "affiliated person" as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the Investment Company Act of 1940) of that issuer. The value of this security as of February 28, 2018 represented less than 1% of the Fund’s Net Assets. See Note 5. |
| (o) | Calculated as a percentage of net assets. Amounts in excess of 100% are due to the Fund’s use of leverage. |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
30 Invesco Senior Loan Fund
| | | | | | | | | | | | | | | | | | | | | | |
| Open Forward Foreign Currency Contracts | |
Settlement
Date | | | | Contract to | | | Unrealized
Appreciation
(Depreciation) | |
| | Counterparty | | Deliver | | | Receive | | |
03/15/2018 | | Citibank, N.A. | | | SEK | | | | 49,210 | | | | USD | | | | 6,070 | | | $ | 126 | |
03/15/2018 | | J.P. Morgan Chase Bank, N.A. | | | SEK | | | | 49,481 | | | | USD | | | | 6,101 | | | | 124 | |
04/16/2018 | | Barclays Bank PLC | | | GBP | | | | 2,833,565 | | | | USD | | | | 3,947,014 | | | | 37,882 | |
04/16/2018 | | Citibank, N.A. | | | EUR | | | | 8,842,769 | | | | USD | | | | 10,980,676 | | | | 155,311 | |
04/16/2018 | | Citibank, N.A. | | | SEK | | | | 49,345 | | | | USD | | | | 6,174 | | | | 199 | |
04/16/2018 | | Goldman Sachs International | | | EUR | | | | 8,845,422 | | | | USD | | | | 10,983,263 | | | | 154,650 | |
04/16/2018 | | Goldman Sachs International | | | GBP | | | | 2,832,715 | | | | USD | | | | 3,945,023 | | | | 37,064 | |
04/16/2018 | | J.P. Morgan Chase Bank, N.A. | | | SEK | | | | 49,345 | | | | USD | | | | 6,168 | | | | 193 | |
04/16/2018 | | Royal Bank of Canada | | | CHF | | | | 404,543 | | | | USD | | | | 435,456 | | | | 5,376 | |
04/16/2018 | | Royal Bank of Canada | | | EUR | | | | 8,842,769 | | | | USD | | | | 10,977,060 | | | | 151,694 | |
04/16/2018 | | Royal Bank of Canada | | | GBP | | | | 2,832,715 | | | | USD | | | | 3,948,054 | | | | 40,094 | |
Subtotal — Appreciation | | | | | | | | | | | | | | | | | | | 582,713 | |
03/15/2018 | | Barclays Bank PLC | | | EUR | | | | 605,010 | | | | USD | | | | 737,502 | | | | (1,296 | ) |
03/15/2018 | | Barclays Bank PLC | | | GBP | | | | 2,877,747 | | | | USD | | | | 3,898,772 | | | | (65,118 | ) |
03/15/2018 | | Barclays Bank PLC | | | USD | | | | 468,442 | | | | EUR | | | | 382,508 | | | | (1,348 | ) |
03/15/2018 | | Barclays Bank PLC | | | USD | | | | 3,943,143 | | | | GBP | | | | 2,835,099 | | | | (37,999 | ) |
03/15/2018 | | Citibank, N.A. | | | EUR | | | | 8,749,821 | | | | USD | | | | 10,575,997 | | | | (108,708 | ) |
03/15/2018 | | Citibank, N.A. | | | USD | | | | 10,914,368 | | | | EUR | | | | 8,810,102 | | | | (156,053 | ) |
03/15/2018 | | Citibank, N.A. | | | USD | | | | 6,254 | | | | SEK | | | | 50,107 | | | | (202 | ) |
03/15/2018 | | Goldman Sachs International | | | EUR | | | | 8,749,837 | | | | USD | | | | 10,573,259 | | | | (111,465 | ) |
03/15/2018 | | Goldman Sachs International | | | GBP | | | | 2,820,811 | | | | USD | | | | 3,826,797 | | | | (58,668 | ) |
03/15/2018 | | Goldman Sachs International | | | USD | | | | 10,965,069 | | | | EUR | | | | 8,851,778 | | | | (155,862 | ) |
03/15/2018 | | Goldman Sachs International | | | USD | | | | 3,952,040 | | | | GBP | | | | 2,842,135 | | | | (37,203 | ) |
03/15/2018 | | J.P. Morgan Chase Bank, N.A. | | | USD | | | | 6,058 | | | | SEK | | | | 48,583 | | | | (190 | ) |
03/15/2018 | | Royal Bank of Canada | | | CHF | | | | 404,314 | | | | USD | | | | 416,297 | | | | (12,291 | ) |
03/15/2018 | | Royal Bank of Canada | | | EUR | | | | 8,749,821 | | | | USD | | | | 10,579,496 | | | | (105,208 | ) |
03/15/2018 | | Royal Bank of Canada | | | GBP | | | | 2,820,811 | | | | USD | | | | 3,826,543 | | | | (58,921 | ) |
03/15/2018 | | Royal Bank of Canada | | | USD | | | | 434,004 | | | | CHF | | | | 404,314 | | | | (5,416 | ) |
03/15/2018 | | Royal Bank of Canada | | | USD | | | | 10,910,651 | | | | EUR | | | | 8,810,102 | | | | (152,335 | ) |
03/15/2018 | | Royal Bank of Canada | | | USD | | | | 3,955,138 | | | | GBP | | | | 2,842,135 | | | | (40,301 | ) |
04/16/2018 | | Royal Bank of Canada | | | USD | | | | 1,304,595 | | | | EUR | | | | 1,039,480 | | | | (32,058 | ) |
Subtotal — Depreciation | | | | | | | | | | | | | | | | | | | (1,140,642 | ) |
Total Forward Foreign Currency Contracts — Currency Risk | | | | | | | $ | (557,929 | ) |
Currency Abbreviations:
| | |
| CHF | | – Swiss Franc |
| EUR | | – Euro |
| GBP | | – British Pound Sterling |
| SEK | | – Swedish Krona |
| USD | | – U.S. Dollar |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
31 Invesco Senior Loan Fund
Statement of Assets and Liabilities
February 28, 2018
| | | | |
Assets: | | | | |
Investments in securities, at value (Cost $942,637,195) | | $ | 932,064,206 | |
Investments in affiliates, at value (Cost $1,793,148) | | | 0 | |
Other investments: | | | | |
Unrealized appreciation on forward foreign currency contracts outstanding | | | 582,713 | |
Cash | | | 27,719,274 | |
Foreign currencies, at value (Cost $5,130,558) | | | 5,027,956 | |
Receivable for: | | | | |
Investments sold | | | 37,854,257 | |
Interest and fees | | | 5,244,305 | |
Fund shares sold | | | 185,855 | |
Investments matured (Cost $23,346,999) | | | 413,661 | |
Investment for trustee deferred compensation and retirement plans | | | 38,660 | |
Other assets | | | 142,891 | |
Total assets | | | 1,009,273,778 | |
| |
Liabilities: | | | | |
Other investments: | | | | |
Unrealized depreciation on forward foreign currency contracts outstanding | | | 1,140,642 | |
Payable for: | | | | |
Borrowings | | | 170,000,000 | |
Investments purchased | | | 65,049,824 | |
Fund shares repurchased | | | 23,876 | |
Dividends | | | 1,180,427 | |
Accrued fees to affiliates | | | 100,096 | |
Accrued interest expense | | | 53,386 | |
Accrued trustees' and officers' fees and benefits | | | 5,202 | |
Accrued other operating expenses | | | 945,777 | |
Trustee deferred compensation and retirement plans | | | 93,695 | |
Unfunded loan commitments | | | 30,493,090 | |
Total liabilities | | | 269,086,015 | |
Net assets applicable to common shares | | $ | 740,187,763 | |
|
Net assets applicable to common shares consist of: | |
Shares of beneficial interest | | $ | 1,046,472,350 | |
Undistributed net investment income | | | (314,971 | ) |
Undistributed net realized gain (loss) | | | (269,925,358 | ) |
Net unrealized appreciation (depreciation) | | | (36,044,258 | ) |
| | | $ | 740,187,763 | |
| | | | |
Net Assets: | | | | |
Class A | | $ | 108,896,503 | |
Class C | | $ | 95,893,686 | |
Class Y | | $ | 2,161,388 | |
Class IB | | $ | 491,279,306 | |
Class IC | | $ | 41,956,880 | |
|
Common shares outstanding, no par value,
with an unlimited number of common shares authorized: | |
Class A | | | 16,203,116 | |
Class C | | | 14,241,370 | |
Class Y | | | 321,543 | |
Class IB | | | 73,070,028 | |
Class IC | | | 6,241,259 | |
Class A: | | | | |
Net asset value per share | | $ | 6.72 | |
Maximum offering price per share | | | | |
(Net asset value of $6.72 ¸ 96.75% | | $ | 6.95 | |
Class C: | | | | |
Net asset value and offering price per share | | $ | 6.73 | |
Class Y: | | | | |
Net asset value and offering price per share | | $ | 6.72 | |
Class IB: | | | | |
Net asset value and offering price per share | | $ | 6.72 | |
Class IC: | | | | |
Net asset value and offering price per share | | $ | 6.72 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
32 Invesco Senior Loan Fund
Statement of Operations
For the year ended February 28, 2018
| | | | |
Investment income: | | | | |
Interest | | $ | 47,494,278 | |
Dividends | | | 57,255 | |
Other income | | | 964,546 | |
Total investment income | | | 48,516,079 | |
| |
Expenses: | | | | |
Advisory fees | | | 6,983,612 | |
Administrative services fees | | | 1,980,474 | |
Custodian fees | | | 381,628 | |
Distribution fees: | | | | |
Class A | | | 292,609 | |
Class B | | | 2,844 | |
Class C | | | 1,061,430 | |
Class IC | | | 66,140 | |
Interest, facilities and maintenance fees | | | 4,066,975 | |
Transfer agent fees | | | 915,504 | |
Trustees' and officers' fees and benefits | | | 33,611 | |
Registration and filing fees | | | 73,034 | |
Reports to shareholders | | | 931,000 | |
Professional services fees | | | 204,706 | |
Taxes | | | 113,590 | |
Other | | | 108,504 | |
Total expenses | | | 17,215,661 | |
Less: Expense offset arrangement(s) | | | (7,061 | ) |
Net expenses | | | 17,208,600 | |
Net investment income | | | 31,307,479 | |
| |
Realized and unrealized gain (loss): | | | | |
Net realized gain (loss) from: | | | | |
Investment securities | | | (1,706,030 | ) |
Foreign currencies | | | 421,610 | |
Forward foreign currency contracts | | | (4,816,762 | ) |
| | | | (6,101,182 | ) |
Change in net unrealized appreciation (depreciation) of: | | | | |
Investment securities | | | 12,396,826 | |
Foreign currencies | | | (227,087 | ) |
Forward foreign currency contracts | | | (552,435 | ) |
| | | | 11,617,304 | |
Net realized and unrealized gain | | | 5,516,122 | |
Net increase in net assets resulting from operations | | $ | 36,823,601 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
33 Invesco Senior Loan Fund
Statement of Changes in Net Assets
For the years ended February 28, 2018 and 2017
| | | | | | | | |
| | | 2018 | | | 2017 | |
Operations: | | | | | | | | |
Net investment income | | $ | 31,307,479 | | | $ | 45,087,285 | |
Net realized gain (loss) | | | (6,101,182 | ) | | | (1,138,691 | ) |
Change in net unrealized appreciation | | | 11,617,304 | | | | 115,307,240 | |
Net increase in net assets resulting from operations | | | 36,823,601 | | | | 159,255,834 | |
| | |
Distributions to shareholders from net investment income: | | | | | | | | |
Class A | | | (4,610,171 | ) | | | (5,775,753 | ) |
Class B | | | (44,741 | ) | | | (103,441 | ) |
Class C | | | (3,402,789 | ) | | | (4,966,347 | ) |
Class Y | | | (92,948 | ) | | | (69,061 | ) |
Class IB | | | (21,853,885 | ) | | | (28,511,016 | ) |
Class IC | | | (1,783,866 | ) | | | (2,327,793 | ) |
Total distributions to shareholders from net investment income | | | (31,788,400 | ) | | | (41,753,411 | ) |
| | |
Return of capital: | | | | | | | | |
Class A | | | (181,886 | ) | | | (218,745 | ) |
Class B | | | (1,929 | ) | | | (3,875 | ) |
Class C | | | (164,636 | ) | | | (220,587 | ) |
Class Y | | | (3,457 | ) | | | (2,521 | ) |
Class IB | | | (810,162 | ) | | | (1,026,953 | ) |
Class IC | | | (68,500 | ) | | | (86,317 | ) |
Total return of capital | | | (1,230,570 | ) | | | (1,558,998 | ) |
| | |
Share transactions–net: | | | | | | | | |
Class A | | | (13,292,398 | ) | | | (9,734,001 | ) |
Class B | | | (1,636,984 | ) | | | (1,082,254 | ) |
Class C | | | (22,251,249 | ) | | | (15,030,726 | ) |
Class Y | | | 114,263 | | | | 753,012 | |
Class IB | | | (64,226,654 | ) | | | (46,726,612 | ) |
Class IC | | | (4,906,593 | ) | | | (3,405,514 | ) |
Net increase (decrease) in net assets resulting from share transactions | | | (106,199,615 | ) | | | (75,226,095 | ) |
Net increase (decrease) in net assets | | | (102,394,984 | ) | | | 40,717,330 | |
| | |
Net assets: | | | | | | | | |
Beginning of year | | | 842,582,747 | | | | 801,865,417 | |
End of year (includes undistributed net investment income of $(314,971) and $(733,988), respectively) | | $ | 740,187,763 | | | $ | 842,582,747 | |
See accompanying Notes to Financial Statements which are an integral part of the financial statements.
34 Invesco Senior Loan Fund
Statement of Cash Flows
For the year ended February 28, 2018
| | | | |
Cash provided by operating activities: | | | | |
Net increase in net assets resulting from operations | | $ | 36,823,601 | |
| |
Adjustments to reconcile the change in net assets from operations to net cash provided by operating activities: | | | | |
Purchases of investments | | | (557,907,392 | ) |
Proceeds from sales of investments | | | 607,685,705 | |
Accretion of discount on investment securities | | | (3,594,518 | ) |
Amortization of loan fees | | | 2,052,689 | |
Decrease in interest receivables and other assets | | | 1,094,725 | |
Increase in accrued expenses and other payables | | | 133,361 | |
Net realized gain (loss) on investment securities | | | 1,706,030 | |
Net change in unrealized appreciation on investments | | | (12,396,826 | ) |
Net change in unrealized depreciation of forward foreign currency contracts | | | 552,435 | |
Net cash provided by operating activities | | | 76,149,810 | |
| |
Cash provided by (used in) financing activities: | | | | |
Proceeds from shares of beneficial interest sold | | | 17,065,105 | |
Proceeds from borrowings | | | 20,000,000 | |
Disbursements for shares of beneficial interest repurchased | | | (140,749,580 | ) |
Dividends paid to shareholders from net investment income | | | (14,541,919 | ) |
Return of capital | | | (1,230,570 | ) |
Net cash provided by (used in) financing activities | | | (119,456,964 | ) |
Net decrease in cash and cash equivalents | | | (43,307,154 | ) |
Cash and cash equivalents at beginning of period | | | 76,054,384 | |
Cash and cash equivalents at end of period | | $ | 32,747,230 | |
| |
Supplemental disclosure of cash flow information: | | | | |
Value of shares of beneficial interest issued in reinvestment of dividends paid to shareholders | | $ | 17,545,361 | |
Conversion of Class B Shares to Class A Shares | | $ | 1,140,125 | |
| |
Supplemental disclosure of cash flow information: | | | | |
Cash paid during the period for interest, facilities and maintenance fees | | $ | 4,206,020 | |
Notes to Financial Statements
February 28, 2018
NOTE 1—Significant Accounting Policies
Invesco Senior Loan Fund (the “Fund”) is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a diversified, closed-end management investment company.
The Fund's investment objective is to provide a high level of current income, consistent with preservation of capital. The Fund invests primarily in adjustable rate senior loans (“Senior Loans”). Senior Loans are business loans that have a senior right to payment and are made to borrowers that may be corporations, partnerships, or other entities. These borrowers operate in a variety of industries and geographic regions. The Fund borrows money for investment purposes which may create the opportunity for enhanced return, but also should be considered a speculative technique and may increase the Fund's volatility.
The Fund continuously offers Class A, Class C and Class Y shares. The Fund also has outstanding Class IB and Class IC shares which are not continuously offered. Each class of shares differs in its initial sales load, contingent deferred sales charges (“CDSC”), the allocation of class-specific expenses and voting rights on matters affecting a single class. Effective January 26, 2018, all of the Fund's outstanding Class B shares were converted to Class A shares in advance of their normally scheduled conversion. No CDSC was paid in connection with this early conversion.
The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 946, Financial Services — Investment Companies.
The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements.
| A. | Security Valuations — Variable rate senior loan interests are fair valued using quotes provided by an independent pricing service. Quotes provided by the pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance, spread, individual trading characteristics, institution-size trading in similar groups of securities and other market data. |
35 Invesco Senior Loan Fund
Securities, including restricted securities, are valued according to the following policy. A security listed or traded on an exchange (except convertible securities) is valued at its last sales price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market (but not securities reported on the NASDAQ Stock Exchange) are valued based on the prices furnished by independent pricing services, in which case the securities may be considered fair valued, or by market makers. Each security reported on the NASDAQ Stock Exchange is valued at the NASDAQ Official Closing Price (“NOCP”) as of the close of the customary trading session on the valuation date or absent a NOCP, at the closing bid price.
Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and the asked prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and asked prices. For purposes of determining net asset value (“NAV”) per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).
Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end-of-day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.
Debt obligations (including convertible securities) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Pricing services generally value debt obligations assuming orderly transactions of institutional round lot size, but a fund may hold or transact in the same securities in smaller, odd lot sizes. Odd lots often trade at lower prices than institutional round lots. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.
Swap agreements are fair valued using an evaluated quote, if available, provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end-of-day net present values, spreads, ratings, industry, company performance and returns of referenced assets. Centrally cleared swap agreements are valued at the daily settlement price determined by the relevant exchange or clearinghouse.
Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the investment adviser determines are significant and make the closing price unreliable, the Fund may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.
Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.
Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust's officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/asked quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.
The Fund may invest in securities that are subject to interest rate risk, meaning the risk that the prices will generally fall as interest rates rise and, conversely, the prices will generally rise as interest rates fall. Specific securities differ in their sensitivity to changes in interest rates depending on their individual characteristics. Changes in interest rates may result in increased market volatility, which may affect the value and/or liquidity of certain Fund investments.
Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
| 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 (net of withholding tax, if any) is recorded on the accrual basis from settlement date. Bond premiums and discounts are amortized and/or accreted over the lives of the respective securities. Pay-in-kind interest income and non-cash dividend income received in the form of securities in-lieu of cash are recorded at the fair value of the securities received. Facility fees received may be amortized over the life of the loan. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. |
The Fund may periodically participate in litigation related to Fund investments. As such, the Fund may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.
36 Invesco Senior Loan Fund
Other income is comprised primarily of amendment fees which are recorded when received. Amendment fees are received in return for changes in the terms of the loan or note.
Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Fund's net asset value and, accordingly, they reduce the Fund's total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and the Statement of Changes in Net Assets, or the net investment income per share and the ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Fund and the investment adviser.
The Fund allocates realized and unrealized capital gains and losses to a class based on the relative net assets of each class. The Fund allocates income to a class based on the relative value of the settled shares of each class.
| C. | Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer's securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted. |
| D. | Distributions — Distributions from net investment income, if any, are declared daily and paid monthly. Distributions from net realized capital gain, if any, are generally declared and paid annually and recorded on the ex-dividend date. The Fund may elect to treat a portion of the proceeds from redemptions as distributions for federal income tax purposes. |
| E. | Federal Income Taxes — The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), necessary to qualify as a regulated investment company and to distribute substantially all of the Fund's taxable earnings to shareholders. As such, the Fund will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements. |
The Fund recognizes the tax benefits of uncertain tax positions only when the position is more likely than not to be sustained. Management has analyzed the Fund's uncertain tax positions and concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions. Management is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months.
The Fund files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Fund is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.
| F. | Interest, Facilities and Maintenance Fees — Interest, Facilities and Maintenance Fees include interest and related borrowing costs such as commitment fees and other expenses associated with lines of credit and interest and administrative expenses related to establishing and maintaining the credit agreement. |
| G. | Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) 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 including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Fund monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print. |
| H. | Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts, including the Fund's servicing agreements, that contain a variety of indemnification clauses. The Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote. |
| I. | Cash and Cash Equivalents — For the purposes of the Statement of Cash Flows, the Fund defines Cash and Cash Equivalents as cash (including foreign currency), money market funds and other investments held in lieu of cash and excludes investments made with cash collateral received. |
| J. | Securities Purchased on a When-Issued and Delayed Delivery Basis — The Fund may purchase and sell interests in corporate loans and corporate debt securities and other portfolio securities on a when-issued and delayed delivery basis, with payment and delivery scheduled for a future date. No income accrues to the Fund on such interests or securities in connection with such transactions prior to the date the Fund actually takes delivery of such interests or securities. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Fund will generally purchase these securities with the intention of acquiring such securities, they may sell such securities prior to the settlement date. |
| K. | Foreign Currency Translations — Foreign currency is valued at the close of the NYSE based on quotations posted by banks and major currency dealers. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at date of valuation. Purchases and sales of portfolio securities (net of foreign taxes withheld on disposition) and income items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of such transactions. The Fund does not separately account for the portion of the results of operations resulting from changes in foreign exchange rates on investments and the fluctuations arising from changes in market prices of securities held. The combined results of changes in foreign exchange rates and the fluctuation of market prices on investments (net of estimated foreign tax withholding) are included with the net realized and unrealized gain or loss from investments in the Statement of Operations. Reported net realized foreign currency gains or losses arise from (1) sales of foreign currencies, (2) currency gains or losses realized between the trade and settlement dates on securities transactions, and (3) the difference between the amounts of dividends, |
37 Invesco Senior Loan Fund
| | interest, and foreign withholding taxes recorded on the Fund's books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency gains and losses arise from changes in the fair values of assets and liabilities, other than investments in securities at fiscal period end, resulting from changes in exchange rates. |
The Fund may invest in foreign securities, which may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. Foreign taxes, if any, are recorded based on the tax regulations and rates that exist in the foreign markets in which the Fund invests and are shown in the Statement of Operations.
| L. | Forward Foreign Currency Contracts — The Fund may engage in foreign currency transactions either on a spot (i.e. for prompt delivery and settlement) basis, or through forward foreign currency contracts, to manage or minimize currency or exchange rate risk. |
The Fund may also enter into forward foreign currency contracts for the purchase or sale of a security denominated in a foreign currency in order to “lock in” the U.S. dollar price of that security, or the Fund may also enter into forward foreign currency contracts that do not provide for physical settlement of the two currencies, but instead are settled by a single cash payment calculated as the difference between the agreed upon exchange rate and the spot rate at settlement based upon an agreed upon notional amount (non-deliverable forwards). The Fund will set aside liquid assets in an amount equal to the daily mark-to-market obligation for forward foreign currency contracts.
A forward foreign currency contract is an obligation between two parties (“Counterparties”) to purchase or sell a specific currency for an agreed-upon price at a future date. The use of forward foreign currency contracts does not eliminate fluctuations in the price of the underlying securities the Fund owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in the value of these contracts are measured by the difference in the contract date and reporting date exchange rates and are recorded as unrealized appreciation (depreciation) until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized and unrealized gains (losses) on the contracts are included in the Statement of Operations. The primary risks associated with forward foreign currency contracts include failure of the Counterparty to meet the terms of the contract and the value of the foreign currency changing unfavorably. These risks may be in excess of the amounts reflected in the Statement of Assets and Liabilities.
| M. | Industry Focus — To the extent that the Fund invests a greater amount of its assets in securities of issuers in the banking and financial services industries, the Fund's performance will depend to a greater extent on the overall condition of those industries. The value of these securities can be sensitive to changes in government regulation, interest rates and economic downturns in the U.S. and abroad. |
| N. | Bank Loan Risk — Although the resale, or secondary market for floating rate loans has grown substantially over the past decade, both in overall size and number of market participants, there is no organized exchange or board of trade on which floating rate loans are traded. Instead, the secondary market for floating rate loans is a private, unregulated interdealer or interbank resale market. Such a market may therefore be subject to irregular trading activity, wide bid/ask spreads, and extended trade settlement periods, which may impair the Fund’s ability to sell bank loans within its desired time frame or at an acceptable price and its ability to accurately value existing and prospective investments. Extended trade settlement periods may result in cash not being immediately available to the Fund. As a result, the Fund may have to sell other investments or engage in borrowing transactions to raise cash to meet its obligations. Similar to other asset classes, bank loan funds may be exposed to counterparty credit risk, or the risk than an entity with which the Fund has unsettled or open transactions may fail to or be unable to perform on its commitments. The Fund seeks to manage counterparty credit risk by entering into transactions only with counterparties that it believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. |
| O. | Other Risks — The Fund may invest all or substantially all of its assets in senior secured floating rate loans and senior secured debt securities that are determined to be rated below investment grade. These securities are generally considered to have speculative characteristics and are subject to greater risk of loss of principal and interest than higher rated securities. The value of lower quality debt securities and floating rate loans can be more volatile due to increased sensitivity to adverse issuer, political, regulatory, market or economic developments. |
The Fund invests in corporate loans from U.S. or non-U.S. companies (the “Borrowers”). The investment of the Fund in a corporate loan may take the form of participation interests or assignments. If the Fund purchases a participation interest from a syndicate of lenders (“Lenders”) or one of the participants in the syndicate (“Participant”), one or more of which administers the loan on behalf of all the Lenders (the “Agent Bank”), the Fund would be required to rely on the Lender that sold the participation interest not only for the enforcement of the Fund's rights against the Borrower but also for the receipt and processing of payments due to the Fund under the corporate loans. As such, the Fund is subject to the credit risk of the Borrower and the Participant. Lenders and Participants interposed between the Fund and a Borrower, together with Agent Banks, are referred to as “Intermediate Participants”.
| P. | Leverage Risk — The Fund may utilize leverage to seek to enhance the yield of the Fund by borrowing. There are risks associated with borrowing in an effort to increase the yield and distributions on the shares, including that the costs of the financial leverage may exceed the income from investments made with such leverage, the higher volatility of the net asset value of the shares, and that fluctuations in the interest rates on the borrowing may affect the yield and distributions to the shareholders. There can be no assurance that the Fund's leverage strategy will be successful. |
NOTE 2—Advisory Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Fund accrues daily and pays monthly an advisory fee to the Adviser based on the annual rate of the Fund's average daily net assets as follows:
| | | | | | | | |
| Average Daily Net Assets | | Rate | |
First $500 million | | | 0 | .90% | | | | |
Next $1 billion | | | 0 | .85% | | | | |
Next $1 billion | | | 0 | .825% | | | | |
Next $500 million | | | 0 | .80% | | | | |
Over $3 billion | | | 0 | .775% | | | | |
For the year ended February 28, 2018, the effective advisory fees incurred by the Fund was 0.88%.
38 Invesco Senior Loan Fund
Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Fund, will pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Fund based on the percentage of assets allocated to such Affiliated Sub-Adviser(s).
The Fund has entered into a transfer agency and service agreement with Invesco Investment Services, Inc. (“IIS”) pursuant to which the Fund has agreed to pay IIS a fee for providing transfer agency and shareholder services to the Fund and reimburse IIS for certain expenses incurred by IIS in the course of providing such services. For the year ended February 28, 2018, expenses incurred under these agreements are shown in the Statement of Operations as Transfer agent fees.
The Fund has entered into an administrative services agreement with Invesco pursuant to which the Fund has agreed to pay Invesco for certain administrative costs related to monitoring the provisions of the loan agreements and any agreements with respect to participations and assignments, record keeping responsibilities with respect to interests in Senior Loans in the Fund's portfolio and providing certain services to the holders of the Fund's securities. For the year ended February 28, 2018, expenses incurred under these agreements are shown in the Statement of Operations as Administrative services fees. Also, Invesco has entered into service agreements whereby State Street Bank and Trust Company (“SSB”) serve as custodian and fund accountant and provides certain administrative services of the Fund.
Shares of the Fund are distributed by Invesco Distributors, Inc. (“IDI”). The Fund has adopted a distribution plan pursuant to Rule 12b-1 under the 1940 Act, and a service plan (collectively, the “Plans”) for Class A shares, Class C shares and Class IC shares to compensate IDI for the sale, distribution, shareholder servicing and maintenance of shareholder accounts for these shares. Under the Plans, the Fund will incur annual fees of up to 0.25% of the average daily net assets of Class A shares and up to 1.00% of the average daily net assets of Class C shares and up to 0.15% (0.25% maximum) of the average daily net assets of Class IC shares. Prior to their conversion to Class A shares, the Fund incurred annual fees of up to 1.00% of Class B average daily net assets. The fees are accrued daily and paid monthly.
With respect to Class C shares, the Fund is authorized to reimburse in future years any distribution related expenses that exceed the maximum annual reimbursement rate for such class, so long as such reimbursement does not cause the Fund to exceed the Class C maximum annual reimbursement rate, respectively. With respect to Class A shares, distribution related expenses that exceed the maximum annual reimbursement rate for such class are not carried forward to future years and the Fund will not reimburse IDI for any such expenses.
For the year ended February 28, 2018, expenses incurred under these agreements are shown in the Statement of Operations as Distribution fees.
Front-end sales commissions and CDSC (collectively, the “sales charges”) are not recorded as expenses of the Fund. Front-end sales commissions are deducted from proceeds from the sales of Fund shares prior to investment in Class A shares of the Fund. CDSC are deducted from redemption proceeds prior to remittance to the shareholder. During the year ended February 28, 2018, IDI advised the Fund that IDI retained $3,540 in front-end sales commissions from the sale of Class A shares and $16,750, $11,301 and $0 from Class A, Class C and Class IC shares, respectively, for CDSC imposed on redemptions by shareholders.
Certain officers and trustees of the Fund are officers and directors of Invesco.
NOTE 3—Additional Valuation Information
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment's assigned level:
| | Level 1 — | Prices are determined using quoted prices in an active market for identical assets. |
| | Level 2 — | Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others. |
| | Level 3 — | Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Fund's own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information. |
The following is a summary of the tiered valuation input levels, as of February 28, 2018. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.
39 Invesco Senior Loan Fund
The Fund's policy is to recognize transfers in and out of the valuation levels as of the end of the reporting period. During the year ended February 28, 2018, there were transfers from Level 2 to Level 3 of $17,410,193 due to third-party vendor quotations utilizing single market quotes and from Level 3 to Level 2 of $5,790,410, due to third-party vendor quotations utilizing more than one market quote.
| | | | | | | | | | | | | | | | |
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
Investments in Securities | | | | | | | | | | | | | | | | |
Variable Rate Senior Loan Interest | | $ | — | | | $ | 747,737,095 | | | $ | 65,812,750 | | | $ | 813,549,845 | |
Bonds & Notes | | | — | | | | 56,211,588 | | | | — | | | | 56,211,588 | |
Structured Products | | | — | | | | 9,509,930 | | | | — | | | | 9,509,930 | |
Common Stocks & Other Equity Interests | | | 16,029,592 | | | | 29,823,722 | | | | 6,668,450 | | | | 52,521,764 | |
Preferred Stocks | | | 55,332 | | | | — | | | | 215,747 | | | | 271,079 | |
Investments Matured | | | — | | | | — | | | | 413,661 | | | | 413,661 | |
Total Investments in Securities | | | 16,084,924 | | | | 843,282,335 | | | | 73,110,608 | | | | 932,477,867 | |
Other Investments — Assets* | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | | — | | | | 582,713 | | | | — | | | | 582,713 | |
Other Investments — Liabilities* | | | | | | | | | | | | | | | | |
Forward Foreign Currency Contracts | | | — | | | | (1,140,642 | ) | | | — | | | | (1,140,642 | ) |
Total Other Investments | | | — | | | | (557,929 | ) | | | — | | | | (557,929 | ) |
Total Investments | | $ | 16,084,924 | | | $ | 842,724,406 | | | $ | 73,110,608 | | | $ | 931,919,938 | |
| * | Unrealized appreciation (depreciation). |
A reconciliation of Level 3 investments is presented when the Fund had a significant amount of Level 3 investments at the beginning and/or end of the reporting period in relation to net assets.
The following is a reconciliation of the fair valuations using significant unobservable inputs (Level 3) during the year ended February 28, 2018:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Value February 28,
2017 | | | Purchases
at Cost | | | Proceeds
from Sales | | | Accrued
Discounts/
Premiums | | | Realized
Gain (Loss) | | | Change in
Unrealized
Appreciation
(Depreciation) | | | Transfers into Level 3 | | | Transfers out of
Level 3 | | | Value February 28,
2018 | |
Variable Rate Senior Loan Interests | | $ | 85,103,222 | | | $ | 24,732,376 | | | $ | (55,634,245 | ) | | $ | 636,338 | | | $ | 629,702 | | | $ | 704,188 | | | $ | 15,153,442 | | | $ | (5,512,273 | ) | | $ | 65,812,750 | |
Common Stocks & Other Equity Interests | | | 8,318,991 | | | | 186,138 | | | | (7,398,546 | ) | | | — | | | | 4,991,297 | | | | (994,383 | ) | | | 1,843,090 | | | | (278,137 | ) | | | 6,668,450 | |
Preferred Stocks | | | 5,840 | | | | 1,399 | | | | — | | | | — | | | | (119,180 | ) | | | 327,688 | | | | — | | | | — | | | | 215,747 | |
Investments Matured | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 413,661 | | | | — | | | | 413,661 | |
Total | | $ | 93,428,053 | | | $ | 24,919,913 | | | $ | (63,032,791 | ) | | $ | 636,338 | | | $ | 5,501,819 | | | $ | 37,493 | | | $ | 17,410,193 | | | $ | (5,790,410 | ) | | $ | 73,110,608 | |
Securities determined to be Level 3 at the end of the reporting period were valued primarily by utilizing quotes from a third-party vendor pricing service. A significant change in third-party pricing information could result in a significantly lower or higher value in Level 3 investments.
NOTE 4—Derivative Investments
The Fund may enter into an International Swaps and Derivatives Association Master Agreement (“ISDA Master Agreement”) under which a fund may trade OTC derivatives. An OTC transaction entered into under an ISDA Master Agreement typically involves a collateral posting arrangement, payment netting provisions and close-out netting provisions. These netting provisions allow for reduction of credit risk through netting of contractual obligations. The enforceability of the netting provisions of the ISDA Master Agreement depends on the governing law of the ISDA Master Agreement, among other factors.
For financial reporting purposes, the Fund does not offset OTC derivative assets or liabilities that are subject to ISDA Master Agreements in the Statement of Assets and Liabilities.
Value of Derivative Investments at Period-End
The table below summarizes the value of the Fund's derivative investments, detailed by primary risk exposure, held as of February 28, 2018:
| | | | |
| | | Value | |
| Derivative Assets | | Currency
Risk | |
Unrealized appreciation on forward foreign currency contracts outstanding | | $ | 582,713 | |
Derivatives not subject to master netting agreements | | | — | |
Total Derivative Assets subject to master netting agreements | | $ | 582,713 | |
40 Invesco Senior Loan Fund
| | | | |
| | | Value | |
| Derivative Liabilities | | Currency
Risk | |
Unrealized depreciation on forward foreign currency contracts outstanding | | $ | (1,140,642 | ) |
Derivatives not subject to master netting agreements | | | — | |
Total Derivative Liabilities subject to master netting agreements | | $ | (1,140,642 | ) |
Offsetting Assets and Liabilities
The table below reflects the Fund's exposure to Counterparties subject to either an ISDA Master Agreement or other agreement for OTC derivative transactions as of February 28, 2018.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | Financial
Derivative
Assets | | | Financial
Derivative
Liabilities | | | | | | Collateral
(Received)/Pledged | | | | |
| Counterparty | | Forward
Foreign Currency
Contracts | | | Forward
Foreign Currency
Contracts | | | Net Value of
Derivatives | | | Non-Cash | | | Cash | | | Net Amount | |
Barclays Bank PLC | | $ | 37,882 | | | $ | (105,761 | ) | | $ | (67,879 | ) | | $ | — | | | $ | — | | | $ | (67,879 | ) |
Citibank, N.A. | | | 155,636 | | | | (264,963 | ) | | | (109,327 | ) | | | — | | | | — | | | | (109,327 | ) |
Goldman Sachs International | | | 191,714 | | | | (363,198 | ) | | | (171,484 | ) | | | — | | | | — | | | | (171,484 | ) |
J.P. Morgan Chase Bank, N.A. | | | 317 | | | | (190 | ) | | | 127 | | | | — | | | | — | | | | 127 | |
Royal Bank of Canada | | | 197,164 | | | | (406,530 | ) | | | (209,366 | ) | | | — | | | | — | | | | (209,366 | ) |
Total | | $ | 582,713 | | | $ | (1,140,642 | ) | | $ | (557,929 | ) | | $ | — | | | $ | — | | | $ | (557,929 | ) |
Effect of Derivative Investments for the year ended February 28, 2018
The table below summarizes the gains (losses) on derivative investments, detailed by primary risk exposure, recognized in earnings during the period:
| | | | |
| | | Location of Gain (Loss) on
Statement of Operations | |
| | | Currency
Risk | |
Realized Gain (Loss): | | | | |
Forward foreign currency contracts | | $ | (4,816,762 | ) |
Change in Net Unrealized Appreciation (Depreciation): | | | | |
Forward foreign currency contracts | | | (552,435 | ) |
Total | | $ | (5,369,197 | ) |
The table below summarizes the average notional value of forward foreign currency contracts outstanding during the period.
| | | | |
| | | Forward
Foreign Currency
Contracts | |
Average notional value | | $ | 149,922,196 | |
NOTE 5—Investments in Other Affiliates
The 1940 Act defines an “affiliated person” as an issuance in which a fund holds 5% or more of the outstanding voting securities. The Fund has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The following is a summary of the investments in other affiliates (excluding affiliated money market funds) for the year ended February 28, 2018.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Value
02/28/17 | | | Purchases
at Cost | | | Proceeds
from Sales | | | Change in
Unrealized
Appreciation
(Depreciation) | | | Realized
Gain | | | Value
02/28/18 | | | Dividend
Income | |
Axia Inc., Common Shares(a) | | $ | 4,532,541 | | | $ | — | | | $ | (6,024,745 | ) | | $ | (2,263,656 | ) | | $ | 3,755,860 | | | $ | — | | | $ | — | |
Cygnus Business Media, Inc., Common Shares | | | 0 | | | | — | | | | — | | | | — | | | | — | | | | 0 | | | | — | |
Total | | $ | 4,532,541 | | | $ | — | | | $ | (6,024,745 | ) | | $ | (2,263,656 | ) | | $ | 3,755,860 | | | $ | 0 | | | $ | — | |
| (a) | As of February 28, 2018, this security is no longer held by the Fund. |
NOTE 6—Expense Offset Arrangement(s)
The expense offset arrangement is comprised of transfer agency credits which result from balances in demand deposit accounts used by the transfer agent for clearing shareholder transactions. For the year ended February 28, 2018, the Fund received credits from this arrangement, which resulted in the reduction of the Fund's total expenses of $7,061.
41 Invesco Senior Loan Fund
NOTE 7—Trustees’ and Officers’ Fees and Benefits
Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Fund to pay remuneration to certain Trustees and Officers of the Fund. Trustees have the option to defer compensation payable by the Fund, and “Trustees’ and Officers’ Fees and Benefits” includes amounts accrued by the Fund to fund such deferred compensation amounts.
NOTE 8—Cash Balances and Borrowings
Effective November 18, 2017, the Fund entered into a $325 million revolving credit and security agreement, which will expire on November 16, 2018. Prior to November 18, 2017, the revolving credit and security agreement was for $375 million. The revolving credit agreement is secured by the assets of the Fund.
During the year ended February 28, 2018, the average daily balance of borrowing under the revolving credit and security agreement was $157,904,110 with a weighted interest rate of 2.06%. The carrying amount of the Fund's payable for borrowings as reported on the Statement of Assets and Liabilities approximates its fair value. Expenses under the credit and security agreement are shown in the Statement of Operations as Interest, facilities and maintenance fees.
Additionally, the Fund is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period-end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Fund may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.
NOTE 9—Unfunded Loan Commitments
As of February 28, 2018, the Fund had unfunded loan commitments, which could be extended at the option of the borrower, pursuant to the following loan agreements with the following borrowers:
| | | | | | | | | | |
| Borrower | | Type | | Principal Amount* | | | Value | |
Allied Universal Holdco LLC | | Incremental Delayed Draw Term Loan | | $ | 457,593 | | | $ | 453,303 | |
Brickman Group Ltd. LLC | | First Lien Revolver Loan | | | 417,854 | | | | 386,515 | |
Community Health Systems, Inc. | | Revolver Loan | | | 843,260 | | | | 824,325 | |
EG Finco Ltd. | | Term Loan B-3 | | EUR | 469,484 | | | | 469,484 | |
Engineered Machinery Holdings, Inc. | | Second Lien Delayed Draw Term Loan | | | 5,568 | | | | 5,568 | |
Hearthside Group Holdings, LLC | | Revolver Loan | | | 1,569,838 | | | | 1,564,815 | |
IAP Worldwide Services, Inc. | | Revolver Loan | | | 1,350,690 | | | | 1,350,690 | |
KPEX Holdings Inc. | | Delayed Draw Term Loan | | | 34,585 | | | | 34,585 | |
Lakeland Tours, LLC | | Delayed Draw Term Loan | | | 55,232 | | | | 55,232 | |
MacDermid, Inc. | | First Lien Multicurrency Revolver Loan | | | 449,747 | | | | 449,020 | |
MacDermid, Inc. | | First Lien Revolver Loan | | | 154,023 | | | | 153,774 | |
National Vision, Inc. | | Revolver Loan | | | 1,249,944 | | | | 1,149,948 | |
Nidda Healthcare Holding AG | | Term Loan B-1 | | GBP | 238,601 | | | | 238,601 | |
NRG Energy, Inc. | | Revolver Loan A | | | 17,507,378 | | | | 17,461,071 | |
Pearl Intermediate Parent LLC | | First Lien Delayed Draw Term Loan | | | 75,500 | | | | 75,044 | |
Prime Security Services Borrower, LLC | | Revolver Loan | | | 1,431,027 | | | | 1,430,133 | |
Scientific Games International, Inc. | | Multicurrency Revolver Loan | | | 2,186,098 | | | | 2,169,702 | |
Scientific Games International, Inc. | | Revolver Loan | | | 1,002,699 | | | | 995,179 | |
TGP Holdings III, LLC | | First Lien Delayed Draw Term Loan | | | 130,545 | | | | 130,545 | |
Transtar Holding Co. | | Term Loan | | | 169,960 | | | | 169,110 | |
Unilabs Diagnostics AB | | Revolver Loan | | EUR | 926,446 | | | | 926,446 | |
| | | | | | | | | $ | 30,493,090 | |
| * | Principal amounts are denominated in U.S. Dollars unless otherwise noted. |
Currency Abbreviations:
| | |
| EUR | | – Euro |
| GBP | | – British Pound Sterling |
42 Invesco Senior Loan Fund
NOTE 10—Distributions to Shareholders and Tax Components of Net Assets
Tax Character of Distributions to Shareholders Paid During the Fiscal Years Ended February 28, 2018 and 2017:
| | | | | | | | |
| | | 2018 | | | 2017 | |
Ordinary income | | $ | 31,788,400 | | | $ | 41,753,411 | |
Return of capital | | | 1,230,570 | | | | 1,558,998 | |
Total distributions | | $ | 33,018,970 | | | $ | 43,312,409 | |
Tax Components of Net Assets at Period-End:
| | | | |
| | | 2018 | |
Net unrealized appreciation (depreciation) — investments | | $ | (36,182,424 | ) |
Net unrealized appreciation (depreciation) — foreign currencies | | | (186,855 | ) |
Temporary book/tax differences | | | (88,275 | ) |
Capital loss carryforward | | | (269,827,033 | ) |
Shares of beneficial interest | | | 1,046,472,350 | |
Total net assets | | $ | 740,187,763 | |
The difference between book-basis and tax-basis unrealized appreciation (depreciation) is due to differences in the timing of recognition of gains and losses on investments for tax and book purposes. The Fund's net unrealized appreciation (depreciation) difference is attributable primarily to wash sales, amortization of bond premium and interest accrual on defaulted bonds.
The temporary book/tax differences are a result of timing differences between book and tax recognition of income and/or expenses. The Fund's temporary book/tax differences are the result of the trustee deferral of compensation and retirement plan benefits.
Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Fund to utilize. Capital losses generated in years beginning after December 22, 2010 can be carried forward for an unlimited period, whereas previous losses expire in eight tax years. Capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Capital loss carryforwards with no expiration date will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforwards in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.
The Fund has a capital loss carryforward as of February 28, 2018, which expires as follows:
| | | | | | | | | | | | |
| Capital Loss Carryforward* | |
| Expiration | | Short-Term | | | Long-Term | | | Total | |
February 28, 2019 | | $ | 93,431,312 | | | $ | — | | | $ | 93,431,312 | |
Not subject to expiration | | | 267,076 | | | | 176,128,645 | | | | 176,395,721 | |
| | | $ | 93,698,388 | | | $ | 176,128,645 | | | $ | 269,827,033 | |
| * | Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code and may be further limited depending upon a variety of factors, including the realization of net unrealized gains or losses as of the date of any reorganization. |
NOTE 11—Investment Transactions
The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Fund during the year ended February 28, 2018 was $527,437,156 and $622,717,250, respectively. Cost of investments, including any derivatives, on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.
| | | | |
| Unrealized Appreciation (Depreciation) of Investments on a Tax Basis | |
Aggregate unrealized appreciation of investments | | $ | 38,392,711 | |
Aggregate unrealized (depreciation) of investments | | | (74,575,135 | ) |
Net unrealized appreciation (depreciation) of investments | | $ | (36,182,424 | ) |
Cost of investments for tax purposes is $968,102,362.
NOTE 12—Reclassification of Permanent Differences
Primarily as a result of differing book/tax treatment of expired capital loss carryforward, on February 28, 2018, undistributed net investment income was increased by $2,130,508, undistributed net realized gain (loss) was increased by $312,079,272 and shares of beneficial interest was decreased by $314,209,780. This reclassification had no effect on the net assets of the Fund.
43 Invesco Senior Loan Fund
NOTE 13—Share Information
| | | | | | | | | | | | | | | | |
| | | Summary of Share Activity | |
| | | Years ended February 28, | |
| | | 2018(a) | | | 2017 | |
| | | Shares | | | Amount | | | Shares | | | Amount | |
Sold: | | | | | | | | | | | | | | | | |
Class A | | | 1,424,258 | | | $ | 9,488,031 | | | | 2,382,957 | | | $ | 15,363,694 | |
Class B(b) | | | 686 | | | | 4,567 | | | | 14,328 | | | | 91,473 | |
Class C | | | 595,173 | | | | 3,979,496 | | | | 809,124 | | | | 5,241,547 | |
Class Y | | | 124,307 | | | | 829,494 | | | | 149,867 | | | | 977,502 | |
Class IB | | | 213,181 | | | | 1,422,966 | | | | 159,913 | | | | 1,032,516 | |
Class IC | | | 24,547 | | | | 163,801 | | | | 11,251 | | | | 72,941 | |
| | | | |
Issued as reinvestment of dividends: | | | | | | | | | | | | | | | | |
Class A | | | 339,450 | | | | 2,263,445 | | | | 487,986 | | | | 3,104,403 | |
Class B(b) | | | 3,315 | | | | 22,084 | | | | 9,192 | | | | 58,299 | |
Class C | | | 296,605 | | | | 1,981,967 | | | | 460,548 | | | | 2,934,531 | |
Class Y | | | 11,069 | | | | 73,860 | | | | 7,297 | | | | 46,696 | |
Class IB | | | 1,820,834 | | | | 12,148,982 | | | | 2,580,298 | | | | 16,446,518 | |
Class IC | | | 158,115 | | | | 1,055,023 | | | | 231,200 | | | | 1,472,840 | |
| | | | |
Conversion of Class B shares to Class A shares:(c) | | | | | | | | | | | | | | | | |
Class A | | | 169,597 | | | | 1,140,125 | | | | 69,806 | | | | 441,369 | |
Class B | | | (169,597 | ) | | | (1,140,125 | ) | | | (69,806 | ) | | | (441,369 | ) |
| | | | |
Reacquired: | | | | | | | | | | | | | | | | |
Class A | | | (3,928,137 | ) | | | (26,183,999 | ) | | | (4,541,853 | ) | | | (28,643,467 | ) |
Class B(b) | | | (78,664 | ) | | | (523,510 | ) | | | (124,380 | ) | | | (790,657 | ) |
Class C | | | (4,225,844 | ) | | | (28,212,712 | ) | | | (3,655,673 | ) | | | (23,206,804 | ) |
Class Y | | | (118,556 | ) | | | (789,091 | ) | | | (43,097 | ) | | | (271,186 | ) |
Class IB | | | (11,664,836 | ) | | | (77,798,602 | ) | | | (10,081,514 | ) | | | (64,205,646 | ) |
Class IC | | | (919,049 | ) | | | (6,125,417 | ) | | | (775,871 | ) | | | (4,951,295 | ) |
Net increase (decrease) in share activity | | | (15,923,546 | ) | | $ | (106,199,615 | ) | | | (11,918,427 | ) | | $ | (75,226,095 | ) |
| (a) | There are entities that are record owners of more than 5% of the outstanding shares of the Fund and in the aggregate own 56% of the outstanding shares of the Fund. IDI has an agreement with these entities to sell Fund shares. The Fund, Invesco and/or Invesco affiliates may make payments to these entities, which are considered to be related to the Fund, for providing services to the Fund, Invesco and/or Invesco affiliates including but not limited to services such as securities brokerage, distribution, third party record keeping and account servicing. The Trust has no knowledge as to whether all or any portion of the shares owned of record by these entities are also owned beneficially. |
| (b) | Class B shares activity for the period March 1, 2017 through January 26, 2018 (date of conversion). |
| (c) | Effective as of close of business January 26, 2018, all outstanding Class B shares were converted to Class A shares. |
NOTE 14—Senior Loan Participation Commitments
The Fund invests in participations, assignments, or acts as a party to the primary lending syndicate of a Senior Loan interest to corporations, partnerships, and other entities. When the Fund purchases a participation of a Senior Loan interest, the Fund typically enters into a contractual agreement with the lender or other third party selling the participation, but not with the borrower directly. As such, the Fund assumes the credit risk of the borrower, selling participant or other persons interpositioned between the Fund and the borrower.
At the year ended February 28, 2018, the following sets forth the selling participants with respect to interest in Senior Loans purchased by the Fund on a participation basis.
| | | | | | | | |
| Selling Participant | | Principal
Amount | | | Value | |
Goldman Sachs Lending Partners LLC | | $ | 1,249,944 | | | $ | 1,149,948 | |
Mizuho Corporate Bank | | | 17,507,378 | | | | 17,461,071 | |
Total | | | | | | $ | 18,611,019 | |
44 Invesco Senior Loan Fund
NOTE 15—Dividends
The Fund declared the following monthly dividends from net investment income subsequent to February 28, 2018:
| | | | | | | | |
| | | | | | Amount per Share | |
| Share Class | | Record Date | | | Payable March 29, 2018 | |
Class A | | | Daily | | | | 0.0221 | |
Class C | | | Daily | | | | 0.0179 | |
Class Y | | | Daily | | | | 0.0235 | |
Class IB | | | Daily | | | | 0.0235 | |
Class IC | | | Daily | | | | 0.0227 | |
NOTE 16—Repurchase of Shares
The Fund has a policy of making monthly repurchase offers (“Repurchase Offers”) for the Fund's common shares pursuant to Rule 23c-3(b) of the 1940 Act.
The Repurchase Offers will be for between 5% and 25% of the Fund's outstanding shares; however, the Fund's present intent for the offers is for not less than 6% (The Board of Trustees may authorize an additional 2%, if necessary, without extending the Repurchase Offers). The repurchase request deadline will be the third Friday of each calendar month (or the preceding business day if such third Friday is not a business day). During the year ended February 28, 2018, the Fund had Repurchase Offers as follows:
| | | | | | | | | | | | |
| Repurchase request deadlines | | Percentage of outstanding
shares the Fund offered
to repurchase | | | Number of shares
tendered (all classes) | | | Percentage of outstanding
shares tendered
(all classes) | |
March 17, 2017 | | | 6.0 | % | | | 1,369,119 | | | | 1.1 | % |
April 21, 2017 | | | 6.0 | | | | 1,780,389 | | | | 1.4 | |
May 19, 2017 | | | 6.0 | | | | 1,514,931 | | | | 1.2 | |
June 16, 2017 | | | 6.0 | | | | 1,441,596 | | | | 1.2 | |
July 21, 2017 | | | 6.0 | | | | 2,078,798 | | | | 1.7 | |
August 18, 2017 | | | 6.0 | | | | 1,630,084 | | | | 1.4 | |
September 15, 2017 | | | 6.0 | | | | 1,145,892 | | | | 1.0 | |
October 20, 2017 | | | 6.0 | | | | 1,730,228 | | | | 1.5 | |
November 17, 2017 | | | 6.0 | | | | 2,033,057 | | | | 1.7 | |
December 15, 2017 | | | 6.0 | | | | 2,133,822 | | | | 1.9 | |
January 19, 2018 | | | 6.0 | | | | 1,830,497 | | | | 1.6 | |
February 16, 2018 | | | 6.0 | | | | 1,521,378 | | | | 1.4 | |
45 Invesco Senior Loan Fund
NOTE 17—Financial Highlights
The following schedule presents financial highlights for a share of the Fund outstanding throughout the periods indicated.
| | | | | | | | | | | | | | | | | | | | |
| | | Class A | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018 | | | 2017 | | | | 2015 | | | 2014 | |
Net asset value, beginning of period | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.76 | | | $ | 6.99 | | | $ | 6.89 | |
Net investment income(a) | | | 0.26 | | | | 0.34 | | | | 0.38 | | | | 0.36 | | | | 0.34 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.05 | | | | 0.86 | | | | (0.94 | ) | | | (0.23 | ) | | | 0.17 | |
Total from investment operations | | | 0.31 | | | | 1.20 | | | | (0.56 | ) | | | 0.13 | | | | 0.51 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.26 | ) | | | (0.32 | ) | | | (0.39 | ) | | | (0.36 | ) | | | (0.40 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.27 | ) | | | (0.33 | ) | | | (0.39 | ) | | | (0.36 | ) | | | (0.41 | ) |
Net asset value, end of period | | $ | 6.72 | | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.76 | | | $ | 6.99 | |
Total return at net asset value(b)(c) | | | 4.79 | % | | | 20.97 | % | | | (8.65 | )% | | | 1.88 | % | | | 7.58 | % |
Net assets, end of period (000's omitted) | | $ | 108,897 | | | $ | 121,627 | | | $ | 115,036 | | | $ | 182,673 | | | $ | 232,475 | |
Portfolio turnover rate(d) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratio/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements(c) | | | 2.24 | %(e) | | | 2.06 | % | | | 1.98 | % | | | 1.90 | %(c)(e) | | | 1.92 | % |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees(c) | | | 1.73 | %(e) | | | 1.67 | % | | | 1.68 | % | | | 1.66 | %(e)(c) | | | 1.66 | % |
Without fee waivers and/or expense reimbursements(c) | | | 2.24 | %(e) | | | 2.06 | % | | | 1.98 | % | | | 1.90 | %(e)(c) | | | 1.92 | % |
Ratio of net investment income with fee waivers and/or expense reimbursements(c) | | | 3.88 | %(e) | | | 5.34 | % | | | 5.82 | % | | | 5.16 | %(c)(e) | | | 4.92 | % |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(f) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Calculated using average shares outstanding. |
| (b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 0.25%, 0.25%, 0.25%, 0.25% and 0.25% for the years ended February 28, 2018, February 28, 2017, February 29, 2016, February 28, 2015 and February 28, 2014, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests. |
| (e) | Ratios are based on average daily net assets (000's omitted) of $117,043. |
| (f) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
46 Invesco Senior Loan Fund
NOTE 17—Financial Highlights—(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | Class B | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018(a) | | | 2017 | | | | 2015 | | | 2014 | |
Net asset value, beginning of period | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.76 | | | $ | 7.02 | | | $ | 6.91 | |
Net investment income(b) | | | 0.24 | | | | 0.34 | | | | 0.38 | | | | 0.36 | | | | 0.34 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.07 | | | | 0.86 | | | | (0.94 | ) | | | (0.23 | ) | | | 0.18 | |
Total from investment operations | | | 0.31 | | | | 1.20 | | | | (0.56 | ) | | | 0.13 | | | | 0.52 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.24 | ) | | | (0.32 | ) | | | (0.39 | ) | | | (0.39 | ) | | | (0.40 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.25 | ) | | | (0.33 | ) | | | (0.39 | ) | | | (0.39 | ) | | | (0.41 | ) |
Net asset value, end of period | | $ | 6.74 | | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.76 | | | $ | 7.02 | |
Total return at net asset value(c)(d) | | | 4.76 | % | | | 20.97 | % | | | (8.65 | )% | | | 1.82 | % | | | 7.72 | % |
Net assets, end of period (000's omitted) | | $ | — | | | $ | 1,633 | | | $ | 2,411 | | | $ | 6,704 | | | $ | 10,575 | |
Portfolio turnover rate(e) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratios/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements(d) | | | 2.24 | %(f)(g) | | | 2.06 | % | | | 1.98 | % | | | 1.90 | % | | | 1.92 | % |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees(d) | | | 1.73 | %(f)(g) | | | 1.67 | % | | | 1.68 | % | | | 1.66 | % | | | 1.66 | % |
Without fee waivers and/or expense reimbursements(d) | | | 2.24 | %(f)(g) | | | 2.06 | % | | | 1.98 | % | | | 1.90 | % | | | 1.92 | % |
Ratio of net investment income with fee waivers and/or expense reimbursements(d) | | | 3.88 | %(f)(g) | | | 5.34 | % | | | 5.82 | % | | | 5.16 | % | | | 4.92 | % |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(h) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Reflects activity for the period March 1, 2017 through January 26, 2018 (date of conversion). |
| (b) | Calculated using average shares outstanding. |
| (c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (d) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 0.25%, 0.25%, 0.25%, 0.25% and 0.25%, for the years ended February 28, 2018, February 28, 2017, February 29, 2016, February 28, 2015 and February 28, 2014 respectively. |
| (e) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests. |
| (f) | Ratios are based on average daily net assets (000's omitted) of $1,135. |
| (h) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
47 Invesco Senior Loan Fund
NOTE 17—Financial Highlights—(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | Class C | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018 | | | 2017 | | | | 2015 | | | 2014 | |
Net asset value, beginning of period | | $ | 6.70 | | | $ | 5.82 | | | $ | 6.77 | | | $ | 7.00 | | | $ | 6.89 | |
Net investment income(a) | | | 0.21 | | | | 0.29 | | | | 0.33 | | | | 0.31 | | | | 0.29 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.04 | | | | 0.87 | | | | (0.94 | ) | | | (0.24 | ) | | | 0.18 | |
Total from investment operations | | | 0.25 | | | | 1.16 | | | | (0.61 | ) | | | 0.07 | | | | 0.47 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.21 | ) | | | (0.27 | ) | | | (0.34 | ) | | | (0.30 | ) | | | (0.35 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.22 | ) | | | (0.28 | ) | | | (0.34 | ) | | | (0.30 | ) | | | (0.36 | ) |
Net asset value, end of period | | $ | 6.73 | | | $ | 6.70 | | | $ | 5.82 | | | $ | 6.77 | | | $ | 7.00 | |
Total return at net asset value(b)(c) | | | 3.86 | % | | | 20.24 | % | | | (9.38 | )% | | | 1.06 | % | | | 6.93 | % |
Net assets, end of period (000's omitted) | | $ | 95,894 | | | $ | 117,699 | | | $ | 116,229 | | | $ | 178,395 | | | $ | 195,205 | |
Portfolio turnover rate(d) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratios/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements(c) | | | 2.99 | %(e) | | | 2.81 | % | | | 2.73 | % | | | 2.65 | % | | | 2.67 | % |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees(c) | | | 2.48 | %(e) | | | 2.42 | % | | | 2.43 | % | | | 2.41 | % | | | 2.41 | % |
Without fee waivers and/or expense reimbursements(c) | | | 2.99 | %(e) | | | 2.81 | % | | | 2.73 | % | | | 2.65 | % | | | 2.67 | % |
Ratio of net investment income with fee waivers and/or expense reimbursements(c) | | | 3.13 | %(e) | | | 4.59 | % | | | 5.07 | % | | | 4.41 | % | | | 4.17 | % |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(f) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Calculated using average shares outstanding. |
| (b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 1.00%, 1.00%, 1.00%, 1.00% and 1.00% for the years ended February 28, 2018, February 28, 2017, February 29, 2016, February 28, 2015 and February 28, 2014, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests. |
| (e) | Ratios are based on average daily net assets (000's omitted) of $106,143. |
| (f) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
48 Invesco Senior Loan Fund
NOTE 17—Financial Highlights—(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | Class Y | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018 | | | 2017 | | | | 2015 | | | 2014(a) | |
Net asset value, beginning of period | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | | | $ | 6.96 | |
Net investment income(b) | | | 0.28 | | | | 0.36 | | | | 0.40 | | | | 0.38 | | | | 0.11 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.05 | | | | 0.85 | | | | (0.95 | ) | | | (0.23 | ) | | | 0.04 | |
Total from investment operations | | | 0.33 | | | | 1.21 | | | | (0.55 | ) | | | 0.15 | | | | 0.15 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.28 | ) | | | (0.33 | ) | | | (0.41 | ) | | | (0.38 | ) | | | (0.10 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.29 | ) | | | (0.34 | ) | | | (0.41 | ) | | | (0.38 | ) | | | (0.11 | ) |
Net asset value, end of period | | $ | 6.72 | | | $ | 6.68 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | |
Total return at net asset value(c) | | | 5.05 | % | | | 21.27 | % | | | (8.53 | )% | | | 2.16 | % | | | 2.22 | % |
Net assets, end of period (000's omitted) | | $ | 2,161 | | | $ | 2,037 | | | $ | 1,108 | | | $ | 2,433 | | | $ | 2,357 | |
Portfolio turnover rate(d) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratios/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements | | | 1.99 | %(e) | | | 1.81 | % | | | 1.73 | % | | | 1.65 | % | | | 1.60 | %(f) |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees | | | 1.48 | %(e) | | | 1.42 | % | | | 1.43 | % | | | 1.41 | % | | | 1.37 | %(f) |
Without fee waivers and/or expense reimbursements | | | 1.99 | %(e) | | | 1.81 | % | | | 1.73 | % | | | 1.65 | % | | | 1.60 | %(f) |
Ratio of net investment income with fee waivers and/or expense reimbursements | | | 4.13 | %(e) | | | 5.59 | % | | | 6.07 | % | | | 5.41 | % | | | 5.24 | %(f) |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(g) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Commencement date of November 8, 2013. |
| (b) | Calculated using average shares outstanding. |
| (c) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. |
| (e) | Ratios are based on average daily net assets (000's omitted) of $2,225. |
| (g) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
49 Invesco Senior Loan Fund
NOTE 17—Financial Highlights—(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | Class IB | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018 | | | 2017 | | | | 2015 | | | 2014 | |
Net asset value, beginning of period | | $ | 6.69 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | | | $ | 6.89 | |
Net investment income(a) | | | 0.28 | | | | 0.36 | | | | 0.39 | | | | 0.37 | | | | 0.36 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.04 | | | | 0.86 | | | | (0.94 | ) | | | (0.22 | ) | | | 0.18 | |
Total from investment operations | | | 0.32 | | | | 1.22 | | | | (0.55 | ) | | | 0.15 | | | | 0.54 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.28 | ) | | | (0.33 | ) | | | (0.41 | ) | | | (0.38 | ) | | | (0.42 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.29 | ) | | | (0.34 | ) | | | (0.41 | ) | | | (0.38 | ) | | | (0.43 | ) |
Net asset value, end of period | | $ | 6.72 | | | $ | 6.69 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | |
Total return at net asset value(b) | | | 4.89 | % | | | 21.45 | % | | | (8.53 | )% | | | 2.16 | % | | | 8.00 | % |
Net assets, end of period (000's omitted) | | $ | 491,279 | | | $ | 552,939 | | | $ | 523,422 | | | $ | 682,816 | | | $ | 805,123 | |
Portfolio turnover rate(c) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratios/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements | | | 1.99 | %(d) | | | 1.81 | % | | | 1.73 | % | | | 1.65 | % | | | 1.67 | % |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees | | | 1.48 | %(d) | | | 1.42 | % | | | 1.43 | % | | | 1.41 | % | | | 1.41 | % |
Without fee waivers and/or expense reimbursements | | | 1.99 | %(d) | | | 1.81 | % | | | 1.73 | % | | | 1.65 | % | | | 1.67 | % |
Ratio of net investment income with fee waivers and/or expense reimbursements | | | 4.13 | %(d) | | | 5.59 | % | | | 6.07 | % | | | 5.41 | % | | | 5.17 | % |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(e) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Calculated using average shares outstanding. |
| (b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests. |
| (d) | Ratios are based on average daily net assets (000's omitted) of $521,550. |
| (e) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
50 Invesco Senior Loan Fund
NOTE 17—Financial Highlights—(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | Class IC | |
| | | Years ended
February 28, | | | Year ended
February 29,
2016 | | | Years ended
February 28, | |
| | | 2018 | | | 2017 | | | | 2015 | | | 2014 | |
Net asset value, beginning of period | | $ | 6.69 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | | | $ | 6.89 | |
Net investment income(a) | | | 0.27 | | | | 0.35 | | | | 0.38 | | | | 0.36 | | | | 0.36 | |
Net gains (losses) on securities (both realized and unrealized) | | | 0.05 | | | | 0.86 | | | | (0.94 | ) | | | (0.22 | ) | | | 0.18 | |
Total from investment operations | | | 0.32 | | | | 1.21 | | | | (0.56 | ) | | | 0.14 | | | | 0.54 | |
Less: | | | | | | | | | | | | | | | | | | | | |
Dividends from net investment income | | | (0.28 | ) | | | (0.32 | ) | | | (0.40 | ) | | | (0.37 | ) | | | (0.42 | ) |
Return of Capital | | | (0.01 | ) | | | (0.01 | ) | | | — | | | | — | | | | (0.01 | ) |
Total distributions | | | (0.29 | ) | | | (0.33 | ) | | | (0.40 | ) | | | (0.37 | ) | | | (0.43 | ) |
Net asset value, end of period | | $ | 6.72 | | | $ | 6.69 | | | $ | 5.81 | | | $ | 6.77 | | | $ | 7.00 | |
Total return at net asset value(b)(c) | | | 4.74 | % | | | 21.28 | % | | | (8.68 | )% | | | 1.99 | % | | | 7.83 | % |
Net assets, end of period (000's omitted) | | $ | 41,957 | | | $ | 46,648 | | | $ | 43,660 | | | $ | 55,548 | | | $ | 66,029 | |
Portfolio turnover rate(d) | | | 53 | % | | | 73 | % | | | 51 | % | | | 59 | % | | | 95 | % |
| | | | | |
Ratios/supplemental data based on average net assets: | | | | | | | | | | | | | | | | | | | | |
Ratio of expenses: | | | | | | | | | | | | | | | | | | | | |
With fee waivers and/or expense reimbursements(c) | | | 2.14 | %(e) | | | 1.96 | % | | | 1.88 | % | | | 1.80 | % | | | 1.82 | % |
With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees(c) | | | 1.63 | %(e) | | | 1.57 | % | | | 1.58 | % | | | 1.56 | % | | | 1.56 | % |
Without fee waivers and/or expense reimbursements(c) | | | 2.14 | %(e) | | | 1.96 | % | | | 1.88 | % | | | 1.80 | % | | | 1.82 | % |
Ratio of net investment income with fee waivers and/or expense reimbursements(c) | | | 3.98 | %(e) | | | 5.44 | % | | | 5.92 | % | | | 5.26 | % | | | 5.02 | % |
| | | | | |
Senior indebtedness: | | | | | | | | | | | | | | | | | | | | |
Total borrowings (000's omitted) | | $ | 170,000 | | | $ | 150,000 | | | $ | 150,000 | | | $ | 224,000 | | | $ | 254,000 | |
Asset coverage per $1,000 unit of senior indebtedness(f) | | $ | 5,354 | | | $ | 6,617 | | | $ | 6,346 | | | $ | 5,949 | | | $ | 6,164 | |
| (a) | Calculated using average shares outstanding. |
| (b) | Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Does not include sales charges and is not annualized for periods less than one year, if applicable. |
| (c) | The total return, ratio of expenses to average net assets and ratio of net investment income to average net assets reflect actual 12b-1 fees of 0.15%, 0.15%, 0.15%, 0.15% and 0.15% for the years ended February 28, 2018, February 28, 2017, February 29, 2016, February 28, 2015 and February 28, 2014, respectively. |
| (d) | Portfolio turnover is calculated at the fund level and is not annualized for periods less than one year, if applicable. Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests. |
| (e) | Ratios are based on average daily net assets (000's omitted) of $44,094. |
| (f) | Calculated by subtracting the Fund's total liabilities (not including the Borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
NOTE 18—Legal Proceedings
Terms used in the Legal Proceedings Note are defined terms solely for the purpose of this note.
Pending Litigation and Regulatory Inquiries
The Fund is named as a defendant in an adversary proceeding in the Bankruptcy Court of the Southern District of Florida. The complaint was filed on July 14, 2008 by the Official Committee of Unsecured Creditors of TOUSA, Inc., on behalf of certain subsidiaries of TOUSA, Inc. (the “Conveying Subsidiaries”), and filed as amended on October 17, 2008. The Committee made allegations against the Fund in two separate capacities: as “Transeastern Lenders” and as “First Lienholders” (collectively, the “Lenders”). The Transeastern Lenders loaned money to form a joint venture between TOUSA, Inc. and Falcone/Ritchie LLC. TOUSA, Inc. later repaid the loans from the Transeastern Lenders as part of a global settlement of claims against it. The repayment was financed using proceeds of new loans (the “New Loans”), for which the Conveying Subsidiaries conveyed first and second priority liens on their assets to two groups of lienholders (the First and Second Lienholders, collectively “New Lenders”). The Conveying Subsidiaries were not obligated on the original debt to the Transeastern Lenders. The Committee alleged, inter alia, that both the repayment to the Transeastern Lenders and the grant of liens to the First and Second Lienholders should be avoided as fraudulent transfers under the bankruptcy laws. More specifically, the Committee alleged: (1) that the Conveying Subsidiaries' transfer of liens to secure the New Loans was a fraudulent transfer under 11 U.S.C. § 548 because the Conveying Subsidiaries were insolvent at the time of the transfer and did not receive reasonably equivalent value for the liens; and (2) that the Transeastern Lenders were, under 11 U.S.C. § 550, entities for whose benefit the liens were fraudulently transferred to the New Lenders. The case was tried in 2009 and on October 13, 2009, the Bankruptcy Court rendered a Final Judgment against the Lenders, which was later amended on October 30, 2009, requiring the Lenders to post bonds equal to 110% of the damages and disgorgement ordered against them. The Transeastern Lenders and First Lienholders separately appealed the decision to the District Court for the Southern District of Florida. On February 11, 2011, the District Court, issued an order in the Transeastern Lenders' appeal that: 1) quashed the Bankruptcy Court's Order as it relates to the liability of the Transeastern Lenders; 2) made null and void the Bankruptcy Court's imposition of remedies as to the Transeastern Lenders; 3) discharged all bonds deposited by Transeastern Lenders, unless any further appeals are filed, in which case the bonds would remain in
51 Invesco Senior Loan Fund
effect pending resolution of appeals; 4) dismissed as moot additional appeal proceedings of the Transeastern Lenders that were contingent upon the District Court's decision concerning liability; and 5) closed all District Court appeal proceedings concerning the Transeastern Lenders. The Committee appealed to the Eleventh Circuit Court of Appeals. In a decision filed on May 15, 2012, the Eleventh Circuit reversed the District Court's opinion, affirmed the liability findings of the Bankruptcy Court against the Transeastern Lenders, and remanded the case to the District Court to review the remedies ordered by the Bankruptcy Court. The appeal of the Transeastern Lenders is currently pending before the District Court. The First Lienholders, having paid its obligations under the bankruptcy plan, have been fully and finally released pursuant to a court order dated August 30, 2013. The review of the Transeastern Lenders remedies obligation is currently pending before the District Court. The parties argued the effects of the Supreme Court decisions in Executive Benefits Ins. Agency v. Arkison (In re Bellingham) (No. 12-1200) and Wellness International Network, Ltd. v. Sharif (No. 13-935) on liabilities before the District Court, which denied that the cases were an intervening change in law that affected the liabilities decision. The District Court remanded to the Bankruptcy Court a question on the effect of the settlement with other parties on the Transeastern Lenders remedies obligations. On April 1, 2016, the Bankruptcy Court issued its report and recommendation, which was unfavorable in many respects to the Transeastern Lenders.
On March 8, 2017, the District Court adopted the Bankruptcy Court's report and recommendation on the impact of the interim settlements, holding that the settlement with the Transeastern Lenders and settlement of the D&O litigation had no impact on the remedial scheme. The Transeastern Lenders appealed this decision in April 2017. On January 11, 2018, the parties’ settlement of the TOUSA, Inc. matter was approved by the Bankruptcy Court. The Fund paid out $2,533,902. On February 6, 2018, the Eleventh Circuit Court of Appeals dismissed the TOUSA, Inc. matter with prejudice. The TOUSA, Inc. matter is concluded.
52 Invesco Senior Loan Fund
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of Invesco Senior Loan Fund
Opinion on the Financial Statements
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Invesco Senior Loan Fund (the “Fund”) as of February 28, 2018, the related statements of operations and cash flows for the year ended February 28, 2018, the statement of changes in net assets for each of the two years in the period ended February 28, 2018, including the related notes, and the financial highlights for the periods indicated therein (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of February 28, 2018, the results of its operations and its cash flows for the year then ended, the changes in its net assets for each of the two years in the period ended February 28, 2018 and the financial highlights for the periods indicated therein in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of February 28, 2018 by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Houston, TX
April 27, 2018
We have served as the auditor of one or more of the investment companies in the Invesco/PowerShares group of investment companies since at least 1995. We have not determined the specific year we began serving as auditor.
53 Invesco Senior Loan Fund
Calculating your ongoing Fund expenses
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any; and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2017 through February 28, 2018.
Actual expenses
The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Actual Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return.
The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as sales charges (loads) on purchase payments or contingent deferred sales charges on redemptions, if any. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
| | | | | | | | | | | | | | | | | | | | | | | | |
| Class | | Beginning
Account Value
(09/01/17) | | | ACTUAL | | | HYPOTHETICAL (5% annual return before
expenses) | | | Annualized
Expense
Ratio | |
| | | Ending
Account Value
(02/28/18)1 | | | Expenses
Paid During
Period2 | | | Ending
Account Value
(02/28/18) | | | Expenses
Paid During
Period2 | | |
| A | | $ | 1,000.00 | | | $ | 1,032.30 | | | $ | 11.59 | | | $ | 1,013.39 | | | $ | 11.48 | | | | 2.30 | % |
| C | | | 1,000.00 | | | | 1,028.50 | | | | 15.34 | | | | 1,009.67 | | | | 15.20 | | | | 3.05 | |
| IB | | | 1,000.00 | | | | 1,033.60 | | | | 10.34 | | | | 1,014.63 | | | | 10.24 | | | | 2.05 | |
| IC | | | 1,000.00 | | | | 1,032.80 | | | | 11.09 | | | | 1,013.88 | | | | 10.99 | | | | 2.20 | |
| Y | | | 1,000.00 | | | | 1,033.60 | | | | 10.34 | | | | 1,014.63 | | | | 10.24 | | | | 2.05 | |
| 1 | The actual ending account value is based on the actual total return of the Fund for the period September 1, 2017 through February 28, 2018, after actual expenses and will differ from the hypothetical ending account value which is based on the Fund's expense ratio and a hypothetical annual return of 5% before expenses. |
| 2 | Expenses are equal to the Fund's annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by 181/365 to reflect the most recent fiscal half year. |
54 Invesco Senior Loan Fund
Tax Information
Form 1099-DIV, Form 1042-S and other year-end tax information provide shareholders with actual calendar year amounts that should be included in their tax returns. Shareholders should consult their tax advisors.
The following distribution information is being provided as required by the Internal Revenue Code or to meet a specific state's requirement.
The Fund designates the following amounts or, if subsequently determined to be different, the maximum amount allowable for its fiscal year ended February 28, 2018:
| | | | |
Federal and State Income Tax | |
Qualified Dividend Income* | | | 0.11% | |
Corporate Dividends Received Deduction* | | | 0.11% | |
U.S. Treasury Obligations* | | | 0.00% | |
Distribution Information
The following table sets forth on a per share basis the distribution that was paid in September 2017. Included in the table is a written statement of the sources of the distribution on a generally accepted accounting principles (“GAAP”) basis.
| | | | | | | | | | | | | | | | | | |
| | | | | Net Income | | | Gain from
Sale of Securities | | | Return of Principal | | | Total Distribution | |
| 09/30/17 | | Class A | | $ | 0.0202 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0221 | |
| 09/30/17 | | Class B | | $ | 0.0202 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0221 | |
| 09/30/17 | | Class C | | $ | 0.0161 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0180 | |
| 09/30/17 | | Class Y | | $ | 0.0216 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0235 | |
| 09/30/17 | | Class IB | | $ | 0.0216 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0235 | |
| 09/30/17 | | Class IC | | $ | 0.0208 | | | $ | 0.000 | | | $ | 0.0019 | | | $ | 0.0227 | |
Please note that the information in the preceding chart is for financial accounting purposes only. Shareholders should be aware that the tax treatment of distributions likely differs from GAAP treatment. Form 1099-DIV for the calendar year will report distributions for U.S. federal income tax purposes. This Notice is sent to comply with certain U.S. Securities and Exchange Commission requirements.
55 Invesco Senior Loan Fund
Trustees and Officers
The address of each trustee and officer is 1555 Peachtree Street, N.E., Atlanta, Georgia 30309. Generally, each trustee serves for a three year term or until his or her successor has been duly elected and qualified, and each officer serves for a one year term or until his or her successor has been duly elected and qualified. Column two below includes length of time served with predecessor entities, if any.
| | | | | | | | |
Name, Year of Birth and
Position(s) Held with the Trust | | Trustee and/
or Officer Since | | Principal Occupation(s) During Past 5 Years | | Number of
Funds in Fund
Complex Overseen by Trustee | | Other Directorship(s) Held by Trustee During Past 5 Years |
| Interested Persons | | | | | | | | |
| Martin L. Flanagan1 — 1960 Trustee | | 2014 | | Executive Director, Chief Executive Officer and President, Invesco Ltd. (ultimate parent of Invesco and a global investment management firm); Trustee, The Invesco Funds; Vice Chair, Investment Company Institute; and Member of Executive Board, SMU Cox School of Business Formerly: Advisor to the Board, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.); Chairman and Chief Executive Officer, Invesco Advisers, Inc. (registered investment adviser); Director, Chairman, Chief Executive Officer and President, Invesco Holding Company (US), Inc. (formerly IVZ Inc.) (holding company), Invesco Group Services, Inc. (service provider) and Invesco North American Holdings, Inc. (holding company); Director, Chief Executive Officer and President, Invesco Holding Company Limited (parent of Invesco and a global investment management firm); Director, Invesco Ltd.; Chairman, Investment Company Institute and President, Co-Chief Executive Officer, Co-President, Chief Operating Officer and Chief Financial Officer, Franklin Resources, Inc. (global investment management organization) | | 158 | | None |
Philip A. Taylor2 — 1954 Trustee and Senior Vice President | | 2014 | | Head of the Americas and Senior Managing Director, Invesco Ltd.; Director, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); Director, Chairman, Chief Executive Officer and President, Invesco Management Group, Inc. (formerly known as Invesco Aim Management Group, Inc.) (financial services holding company); Director and Chairman, Invesco Investment Services, Inc. (formerly known as Invesco Aim Investment Services, Inc.) (registered transfer agent); Chief Executive Officer, Invesco Corporate Class Inc. (corporate mutual fund company); Director, Chairman and Chief Executive Officer, Invesco Canada Ltd. (formerly known as Invesco Trimark Ltd./Invesco Trimark Ltèe) (registered investment adviser and registered transfer agent); Trustee and Senior Vice President, The Invesco Funds; Director, Invesco Investment Advisers LLC (formerly known as Van Kampen Asset Management). Formerly: Co-Chairman, Co-President and Co-Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); Director, Chief Executive Officer and President, Van Kampen Exchange Corp; President and Principal Executive Officer, The Invesco Funds (other than AIM Treasurer’s Series Trust (Invesco Treasurer’s Series Trust), Short-Term Investments Trust and Invesco Management Trust); Executive Vice President, The Invesco Funds (AIM Treasurer’s Series Trust (Invesco Treasurer’s Series Trust), Short-Term Investments Trust and Invesco Management Trust only); Director and President, INVESCO Funds Group, Inc. (registered investment adviser and registered transfer agent); Director and Chairman, IVZ Distributors, Inc. (formerly known as INVESCO Distributors, Inc.) (registered broker dealer); Director, President and Chairman, Invesco Inc. (holding company), Invesco Canada Holdings Inc. (holding company), Trimark Investments Ltd./Placements Trimark Ltèe and Invesco Financial Services Ltd/Services Financiers Invesco Ltèe; Chief Executive Officer, Invesco Canada Fund Inc. (corporate mutual fund company); Director and Chairman, Van Kampen Investor Services Inc.; Director, Chief Executive Officer and President, 1371 Preferred Inc. (holding company) and Van Kampen Investments Inc.; Director and President, AIM GP Canada Inc. (general partner for limited partnerships) and Van Kampen Advisors, Inc.; Director and Chief Executive Officer, Invesco Trimark Dealer Inc. (registered broker dealer); Director, Invesco Distributors, Inc. (formerly known as Invesco Aim Distributors, Inc.) (registered broker dealer); Manager, Invesco PowerShares Capital Management LLC; Director, Chief Executive Officer and President, Invesco Advisers, Inc.; Director, Chairman, Chief Executive Officer and President, Invesco Aim Capital Management, Inc.; President, Invesco Trimark Dealer Inc. and Invesco Trimark Ltd./Invesco Trimark Ltèe; Director and President, AIM Trimark Corporate Class Inc. and AIM Trimark Canada Fund Inc.; Senior Managing Director, Invesco Holding Company Limited; Director and Chairman, Fund Management Company (former registered broker dealer); President and Principal Executive Officer, The Invesco Funds (AIM Treasurer’s Series Trust (Invesco Treasurer’s Series Trust), and Short-Term Investments Trust only); President, AIM Trimark Global Fund Inc. and AIM Trimark Canada Fund Inc. | | 158 | | None |
| 1 | Mr. Flanagan is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer of the Adviser to the Trust, and an officer and a director of Invesco Ltd., ultimate parent of the Adviser. |
| 2 | Mr. Taylor is considered an interested person (within the meaning of Section 2(a)(19) of the 1940 Act) of the Trust because he is an officer and a director of the Adviser. |
T-1 Invesco Senior Loan Fund
Trustees and Officers—(continued)
| | | | | | | | |
Name, Year of Birth and
Position(s) Held with the Trust | | Trustee and/
or Officer Since | | Principal Occupation(s) During Past 5 Years | | Number of
Funds in Fund Complex Overseen by Trustee | | Other Directorship(s) Held by Trustee During Past 5 Years |
| Independent Trustees | | | | | | | | |
Bruce L. Crockett — 1944 Trustee and Chair | | 2014 | | Chairman, Crockett Technologies Associates (technology consulting company) Formerly: Director, Captaris (unified messaging provider); Director, President and Chief Executive Officer, COMSAT Corporation; Chairman, Board of Governors of INTELSAT (international communications company); ACE Limited (insurance company); Independent Directors Council and Investment Company Institute: Member of the Audit Committee, Investment Company Institute; Member of the Executive Committee and Chair of the Governance Committee, Independent Directors Council | | 158 | | Director and Chairman of the Audit Committee, ALPS (Attorneys Liability Protection Society) (insurance company); Director and Member of the Audit Committee and Compensation Committee, Ferroglobe PLC (metallurgical company) |
David C. Arch — 1945 Trustee | | 1988 | | Chairman of Blistex Inc. (consumer health care products manufacturer); Member, World Presidents’ Organization | | 158 | | Board member of the Illinois Manufacturers’ Association |
Jack M. Fields — 1952 Trustee | | 2014 | | Chief Executive Officer, Twenty First Century Group, Inc. (government affairs company); and Chairman, Discovery Learning Alliance (non-profit) Formerly: Owner and Chief Executive Officer, Dos Angeles Ranch L.P. (cattle, hunting, corporate entertainment); Director, Insperity, Inc. (formerly known as Administaff) (human resources provider); Chief Executive Officer, Texana Timber LP (sustainable forestry company); Director of Cross Timbers Quail Research Ranch (non-profit); and member of the U.S. House of Representatives | | 158 | | None |
Cynthia Hostetler — 1962 Trustee | | 2017 | | Non-Executive Director and Trustee of a number of public and private business corporations Formerly: Head of Investment Funds and Private Equity, Overseas Private Investment Corporation; President, First Manhattan Bancorporation, Inc.; Attorney, Simpson Thacher & Bartlett LLP | | 158 | | Vulcan Materials Company (construction materials company); Trilinc Global Impact Fund; Aberdeen Investment Funds (4 portfolios); Artio Global Investment LLC (mutual fund complex); Edgen Group, Inc. (specialized energy and infrastructure products distributor) |
Eli Jones — 1961 Trustee | | 2016 | | Professor and Dean, Mays Business School — Texas A&M University Formerly: Professor and Dean, Walton College of Business, University of Arkansas and E.J. Ourso College of Business, Louisiana State University; Director, Arvest Bank | | 158 | | Insperity, Inc. (formerly known as Administaff) (human resources provider) |
Prema Mathai-Davis — 1950 Trustee | | 2014 | | Retired. | | 158 | | None |
Teresa M. Ressel — 1962 Trustee | | 2017 | | Non-executive director and trustee of a number of public and private business corporations Formerly: Chief Financial Officer, Olayan America, The Olayan Group (international investor/commercial/industrial); Chief Executive Officer, UBS Securities LLC; Group Chief Operating Officer, Americas, UBS AG; Assistant Secretary for Management & Budget and CFO, US Department of the Treasury | | 158 | | Atlantic Power Corporation (power generation company); ON Semiconductor Corp. (semiconductor supplier) |
Ann Barnett Stern — 1957 Trustee | | 2017 | | President and Chief Executive Officer, Houston Endowment Inc. (private philanthropic institution) Formerly: Executive Vice President and General Counsel, Texas Children’s Hospital; Attorney, Beck, Redden and Secrest, LLP; Business Law Instructor, University of St. Thomas; Attorney, Andrews & Kurth LLP | | 158 | | Federal Reserve Bank of Dallas |
Raymond Stickel, Jr. — 1944 Trustee | | 2014 | | Retired. Formerly: Director, Mainstay VP Series Funds, Inc. (25 portfolios); Partner, Deloitte & Touche | | 158 | | None |
Robert C. Troccoli — 1949 Trustee | | 2016 | | Adjunct Professor, University of Denver — Daniels College of Business Formerly: Senior Partner, KPMG LLP | | 158 | | None |
Christopher L. Wilson — 1957 Trustee | | 2017 | | Non-executive director and trustee of a number of public and private business corporations Formerly: Managing Partner, CT2, LLC (investing and consulting firm); President/Chief Executive Officer, Columbia Funds, Bank of America Corporation; President/Chief Executive Officer, CDC IXIS Asset Management Services, Inc.; Principal & Director of Operations, Scudder Funds, Scudder, Stevens & Clark, Inc.; Assistant Vice President, Fidelity Investments | | 158 | | TD Asset Management USA Inc. (mutual fund complex) (22 portfolios); ISO New England, Inc. (non-profit organization managing regional electricity market) |
T-2 Invesco Senior Loan Fund
Trustees and Officers—(continued)
| | | | | | | | |
Name, Year of Birth and
Position(s) Held with the Trust | | Trustee and/
or Officer Since | | Principal Occupation(s) During Past 5 Years | | Number of
Funds in Fund Complex Overseen by Trustee | | Other Directorship(s) Held by Trustee During Past 5 Years |
| Other Officers | | | | | | | | |
Sheri Morris — 1964 President, Principal Executive Officer and Treasurer | | 2010 | | President, Principal Executive Officer and Treasurer, The Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); and Vice President, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust,PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust Formerly: Vice President and Principal Financial Officer, The Invesco Funds; Vice President, Invesco Aim Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; Assistant Vice President and Assistant Treasurer, The Invesco Funds and Assistant Vice President, Invesco Advisers, Inc., Invesco Aim Capital Management, Inc. and Invesco Aim Private Asset Management, Inc.; and Treasurer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust and PowerShares Actively Managed Exchange-Traded Fund Trust | | N/A | | N/A |
Russell C. Burk — 1958 Senior Vice President and Senior Officer | | 2014 | | Senior Vice President and Senior Officer, The Invesco Funds | | N/A | | N/A |
Jeffrey H. Kupor — 1968 Senior Vice President, Chief Legal Officer and Secretary | | 2018 | | Senior Vice President, Secretary and General Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM Management Group, Inc.); Senior Vice President and Secretary, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); Senior Vice President and Secretary, Invesco Distributors, Inc. (formerly known as Invesco AIM Distributors, Inc.); Vice President and Secretary, Invesco Investment Services, Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice President, Chief Legal Officer and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco Investment Advisers LLC (formerly known as Van Kampen Asset Management); Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.) and Chief Legal Officer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC; Secretary and General Counsel, INVESCO Private Capital Investments, Inc.; Secretary, W.L. Ross & Co., LLC; Secretary and Vice President, Jemstep, Inc. Formerly: Assistant Secretary, INVESCO Asset Management (Bermuda) Ltd.; Secretary and General Counsel, Invesco Private Capital, Inc.; Assistant Secretary and General Counsel, INVESCO Realty, Inc.; Secretary and General Counsel, Invesco Senior Secured Management, Inc.; and Secretary, Sovereign G./P. Holdings Inc. | | N/A | | N/A |
John M. Zerr — 1962 Senior Vice President | | 2010 | | Chief Operating Officer of the Americas; Director and Senior Vice President, Invesco Management Group, Inc. (formerly known as Invesco AIM Management Group, Inc.); Senior Vice President, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); Senior Vice President, Invesco Distributors, Inc. (formerly known as Invesco AIM Distributors, Inc.); Director and Vice President, Invesco Investment Services, Inc. (formerly known as Invesco AIM Investment Services, Inc.) Senior Vice President, The Invesco Funds; Managing Director, Invesco PowerShares Capital Management LLC; Director, Invesco Investment Advisers LLC (formerly known as Van Kampen Asset Management); Senior Vice President, Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.); Manager, Invesco Indexing LLC Formerly: Secretary and General Counsel, Invesco Management Group, Inc. (formerly known as Invesco AIM Management Group, Inc.); Secretary, Invesco Investment Services, Inc. (formerly known as Invesco AIM Investment Services, Inc.); Chief Legal Officer and Secretary, The Invesco Funds; Secretary and General Counsel, Invesco Investment Advisers LLC (formerly known as Van Kampen Asset Management); Secretary and General Counsel, Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.); Chief Legal Officer, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust; Secretary, Invesco Indexing LLC; Director, Secretary, General Counsel and Senior Vice President, Van Kampen Exchange Corp.; Director, Vice President and Secretary, IVZ Distributors, Inc. (formerly known as INVESCO Distributors, Inc.); Director and Vice President, INVESCO Funds Group, Inc.; Director and Vice President, Van Kampen Advisors Inc.; Director, Vice President, Secretary and General Counsel, Van Kampen Investor Services Inc.; Director and Secretary, Invesco | | N/A | | N/A |
T-3 Invesco Senior Loan Fund
Trustees and Officers—(continued)
| | | | | | | | |
Name, Year of Birth and
Position(s) Held with the Trust | | Trustee and/
or Officer Since | | Principal Occupation(s) During Past 5 Years | | Number of
Funds in Fund Complex Overseen by Trustee | | Other Directorship(s) Held by Trustee During Past 5 Years |
Other Officers—
(continued) | | | | | | | | |
| | | | | Distributors, Inc. (formerly known as Invesco AIM Distributors, Inc.); Director, Senior Vice President, General Counsel and Secretary, Invesco AIM Advisers, Inc. and Van Kampen Investments Inc.; Director, Vice President and Secretary, Fund Management Company; Director, Senior Vice President, Secretary, General Counsel and Vice President, Invesco AIM Capital Management, Inc.; Chief Operating Officer and General Counsel, Liberty Ridge Capital, Inc. (an investment adviser); Vice President and Secretary, PBHG Funds (an investment company) and PBHG Insurance Series Fund (an investment company); Chief Operating Officer, General Counsel and Secretary, Old Mutual Investment Partners (a broker-dealer); General Counsel and Secretary, Old Mutual Fund Services (an administrator) and Old Mutual Shareholder Services (a shareholder servicing center); Executive Vice President, General Counsel and Secretary, Old Mutual Capital, Inc. (an investment adviser); and Vice President and Secretary, Old Mutual Advisors Funds (an investment company) | | | | |
Gregory G. McGreevey — 1962 Senior Vice President | | 2012 | | Senior Managing Director, Invesco Ltd.; Director, Chairman, President, and Chief Executive Officer, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser); Senior Vice President, Invesco Management Group, Inc.; Director, Invesco Mortgage Capital, Inc. and Invesco Senior Secured Management, Inc.; and Senior Vice President, The Invesco Funds Formerly: Assistant Vice President, The Invesco Funds | | N/A | | N/A |
Kelli Gallegos — 1970 Vice President, Principal Financial Officer and Assistant Treasurer | | 2010 | | Vice President, Principal Financial Officer and Assistant Treasurer, The Invesco Funds; Assistant Treasurer, Invesco PowerShares Capital Management LLC, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust,PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust Formerly: Assistant Vice President, The Invesco Funds | | N/A | | N/A |
Tracy Sullivan — 1962 Vice President, Chief Tax Officer and Assistant Treasurer | | 2010 | | Vice President, Chief Tax Officer and Assistant Treasurer, The Invesco Funds; Assistant Treasurer, Invesco PowerShares Capital Management LLC, PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust,PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust Formerly: Assistant Vice President, The Invesco Funds | | N/A | | N/A |
Crissie M. Wisdom — 1969 Anti-Money Laundering Compliance Officer | | 2013 | | Anti-Money Laundering Compliance Officer, Invesco Advisers, Inc. (formerly known as Invesco Institutional (N.A.), Inc.) (registered investment adviser), Invesco Capital Markets, Inc. (formerly known as Van Kampen Funds Inc.), Invesco Distributors, Inc., Invesco Investment Services, Inc., Invesco Management Group, Inc., The Invesco Funds, and PowerShares Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded Fund Trust, PowerShares Actively Managed Exchange-Traded Fund Trust,PowerShares Actively Managed Exchange-Traded Commodity Fund Trust and PowerShares Exchange-Traded Self-Indexed Fund Trust; Anti-Money Laundering Compliance Officer and Bank Secrecy Act Officer, INVESCO National Trust Company and Invesco Trust Company; and Fraud Prevention Manager and Controls and Risk Analysis Manager for Invesco Investment Services, Inc. Formerly: Anti-Money Laundering Compliance Officer, Van Kampen Exchange Corp. | | N/A | | N/A |
Robert R. Leveille — 1969 Chief Compliance Officer | | 2016 | | Chief Compliance Officer, Invesco Advisers, Inc. (registered investment adviser); and Chief Compliance Officer, The Invesco Funds Formerly: Chief Compliance Officer, Putnam Investments and the Putnam Funds | | N/A | | N/A |
| | | | | | |
Office of the Fund 1555 Peachtree Street, N.E. Atlanta, GA 30309 | | Investment Adviser Invesco Advisers, Inc. 1555 Peachtree Street, N.E. Atlanta, GA 30309 | | Distributor Invesco Distributors, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | | Auditors PricewaterhouseCoopers LLP 1000 Louisiana Street, Suite 5800 Houston, TX 77002-5021 |
| | | |
| | | | | | |
Counsel to the Fund Stradley Ronon Stevens & Young, LLP 2005 Market Street, Suite 2600 Philadelphia, PA 19103-7018 | | Investment Sub-Adviser Invesco Senior Secured Management, Inc. 1166 Avenue of the Americas New York, NY 10036 | | Transfer Agent Invesco Investment Services, Inc. 11 Greenway Plaza, Suite 1000 Houston, TX 77046-1173 | | Custodian State Street Bank and Trust Company 225 Franklin Street Boston, MA 02110-2801 |
T-4 Invesco Senior Loan Fund
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| ∎ | | Fund reports and prospectuses |
Invesco mailing information
Send general correspondence to Invesco Investment Services, Inc., P.O. Box 219078, Kansas City, MO 64121-9078.
Important notice regarding delivery of security holder documents
To reduce Fund expenses, only one copy of most shareholder documents may be mailed to shareholders with multiple accounts at the same address (Householding). Mailing of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact Invesco Investment Services, Inc. at 800 959 4246 or contact your financial institution. We will begin sending you individual copies for each account within 30 days after receiving your request.
Fund holdings and proxy voting information
The Fund provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Fund’s semiannual and annual reports to shareholders. For the first and third quarters, the Fund files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Fund’s Forms N-Q on the SEC website at sec.gov. Copies of the Fund’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file number for the Fund is shown below.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 959 4246 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.
| | |
Information regarding how the Fund voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. The information is also available on the SEC website, sec.gov. Invesco Advisers, Inc. is an investment adviser; it provides investment advisory services to individual and institutional clients and does not sell securities. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail mutual funds, exchange-traded funds and institutional money market funds. Both are wholly owned, indirect subsidiaries of Invesco Ltd. | | 
|
SEC file number: 811-05845 Invesco Distributors, Inc. VK-SLO-AR-1 04252018 0932
On May 2, 2018, the Board of Trustees of the Invesco Funds amended the Code of Ethics (the “Code”) that applies to the Registrant’s Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”) during the period covered by the report. The Registrant did not grant any waivers, including implicit waivers, from any provisions of the Code to the PEO or PFO during the period covered by this report.
| ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
The Board of Trustees has determined that the Registrant has at least one audit committee financial expert serving on its Audit Committee. The Audit Committee financial experts are David C. Arch, Bruce L. Crockett, Cynthia Hostetler, Teresa M. Ressel, Raymond Stickel, Jr. and Robert C. Troccoli. David C. Arch, Bruce L. Crockett, Cynthia Hostetler, Teresa M. Ressel, Raymond Stickel, Jr. and Robert Troccoli are “independent” within the meaning of that term as used in Form N-CSR.
| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
PricewaterhouseCoopers LLP informed the Trust that it has identified an issue related to its independence under Rule 2-01(c)(1)(ii)(A) of Regulation S-X (referred to as the Loan Rule). The Loan Rule prohibits accounting firms, such as PricewaterhouseCoopers LLP, from being deemed independent if they have certain financial relationships with their audit clients or certain affiliates of those clients. The Trust is required under various securities laws to have its financial statements audited by an independent accounting firm.
The Loan Rule specifically provides that an accounting firm would not be independent if it or certain affiliates and covered persons receives a loan from a lender that is a record or beneficial owner of more than ten percent of an audit client’s equity securities (referred to as a “more than ten percent owner”). For purposes of the Loan Rule, audit clients include the Funds as well as all registered investment companies advised by the Adviser and its affiliates, including other subsidiaries of the Adviser’s parent company, Invesco Ltd. (collectively, the Invesco Fund Complex). PricewaterhouseCoopers LLP informed the Trust it and certain affiliates and covered persons have relationships with lenders who hold, as record owner, more than ten percent of the shares of certain funds within the Invesco Fund Complex, which may implicate the Loan Rule.
On June 20, 2016, the SEC Staff issued a “no-action” letter to another mutual fund complex (see Fidelity Management & Research Company et al., No-Action Letter) related to the audit independence issue described above. In that letter, the SEC confirmed that it would not recommend enforcement action against a fund that relied on audit services performed by an audit firm that was not in compliance with the Loan Rule in certain specified circumstances. In connection with prior independence determinations, PricewaterhouseCoopers LLP communicated, as contemplated by the no-action letter, that it believes that it remains objective and impartial and that a reasonable investor possessing all the facts would conclude that PricewaterhouseCoopers LLP is able to exhibit the requisite objectivity and impartiality to report on the Funds’ financial statements as the independent registered public accounting firm. PricewaterhouseCoopers LLP also represented that it has complied with PCAOB Rule 3526(b)(1) and (2), which are conditions to the Funds relying on the no action letter, and affirmed that it is an independent accountant within the meaning of PCAOB Rule 3520. Therefore, the Adviser, the Funds and PricewaterhouseCoopers LLP concluded that PricewaterhouseCoopers LLP could continue as the Funds’ independent registered public accounting firm. The Invesco Fund Complex relied upon the no-action letter in reaching this conclusion.
If in the future the independence of PricewaterhouseCoopers LLP is called into question under the Loan Rule by circumstances that are not addressed in the SEC’s no-action letter, the Funds will need to take other action in order for the Funds’ filings with the SEC containing financial statements to be deemed compliant with applicable securities laws. Such additional actions could result in additional costs, impair the ability of the Funds to issue new shares or have other material adverse effects on the Funds. The SEC no-action relief was initially set to expire 18 months from issuance but has been extended by the SEC without an expiration date, except that the no-action letter will be withdrawn upon the effectiveness of any amendments to the Loan Rule designed to address the concerns expressed in the letter.
(a) to (d)
Item 4. Principal Accountant Fees and Services
Fees Billed by PWC Related to the Registrant
PWC billed the Registrant aggregate fees for services rendered to the Registrant for the last two fiscal years as follows:
| | | | | | | | |
| | | Fees Billed for
Services Rendered to
the Registrant for
fiscal year end 2018 | | | Fees Billed for
Services Rendered to
the Registrant for
fiscal year end 2017 | |
Audit Fees | | $ | 72,775 | | | $ | 69,975 | |
Audit-Related Fees(1) | | $ | 14,000 | | | $ | 12,500 | |
Tax Fees(2) | | $ | 10,395 | | | $ | 6,125 | |
All Other Fees | | $ | 0 | | | $ | 0 | |
| | | | | | | | |
Total Fees | | $ | 97,170 | | | $ | 88,600 | |
(g) PWC billed the Registrant aggregate non-audit fees of $24,395 for the fiscal year ended 2018, and $18,625 for the fiscal year ended 2017, for non-audit services rendered to the Registrant.
| (1) | Audit-Related fees for the fiscal year end February 28, 2018 includes fees billed for agreed upon procedures related to line of credit compliance. Audit-Related fees for the fiscal year end February 28, 2017 includes fees billed for agreed upon procedures related to line of credit compliance. |
| (2) | Tax fees for the fiscal year end February 28, 2018 includes fees billed for reviewing tax returns and/or services related to tax compliance. Tax fees for fiscal year end February 28, 2017 includes fees billed for reviewing tax returns and/or services related to tax compliance. |
Fees Billed by PWC Related to Invesco and Invesco Affiliates
PWC billed Invesco Advisers, Inc. (“Invesco”), the Registrant’s adviser, and any entity controlling, controlled by or under common control with Invesco that provides ongoing services to the Registrant (“Invesco Affiliates”) aggregate fees for pre-approved non-audit services rendered to Invesco and Invesco Affiliates for the last two fiscal years as follows:
| | | | | | | | |
| | | Fees Billed for Non-
Audit Services
Rendered to Invesco
and Invesco Affiliates
for fiscal year end
2018 That Were
Required
to be Pre-Approved
by the Registrant’s
Audit Committee | | | Fees Billed for Non-
Audit Services
Rendered to Invesco
and Invesco Affiliates
for fiscal year end
2017 That Were
Required
to be Pre-Approved
by the Registrant’s
Audit Committee | |
Audit-Related Fees | | $ | 662,000 | | | $ | 635,000 | |
Tax Fees | | $ | 0 | | | $ | 0 | |
All Other Fees | | $ | 611,000 | | | $ | 2,827,000 | |
| | | | | | | | |
Total Fees(1) | | $ | 1,273,000 | | | $ | 3,462,000 | |
| (1) | Audit-Related fees for the year end 2018 include fees billed related to reviewing controls at a service organization. Audit-Related fees for the year end 2017 include fees billed related to reviewing controls at a service organization. |
All other fees for the year end 2018 include fees billed related to the assessments for certain of the company’s risk management tools, current state analysis against regulatory requirements and identification of structural and organizational alternatives, informed by industry practices, for certain of the company’s administrative activities and functions. All other fees for the year end 2017 include fees billed related to the identification of structural and organizational alternatives, informed by industry practices, for certain of the company’s administrative activities and functions.
(e)(2) There were no amounts that were pre-approved by the Audit Committee pursuant to the de minimus exception under Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) Including the fees for services not required to be pre-approved by the registrant’s audit committee, PWC billed Invesco and Invesco Affiliates aggregate non-audit fees of $4,101,000 for the fiscal year ended February 28, 2018, and $6,075,000 for the fiscal year ended February 28, 2017, for non-audit services rendered to Invesco and Invesco Affiliates.
PWC provided audit services to the Investment Company complex of approximately $23 million.
(h) The Audit Committee also has considered whether the provision of non-audit services that were rendered to Invesco and Invesco Affiliates that were not required to be pre-approved pursuant to SEC regulations, if any, is compatible with maintaining PWC’s independence.
(e)(1)
PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
POLICIES AND PROCEDURES
As adopted by the Audit Committees
of the Invesco Funds (the “Funds”)
Last Amended May 4, 2016
| | I. | Statement of Principles |
The Audit Committees (the “Audit Committee”) of the Boards of Trustees of the Funds (the “Board”) have adopted these policies and procedures (the “Procedures”) with respect to the pre-approval of audit and non-audit services to be provided by the Funds’ independent auditor (the “Auditor”) to the Funds, and to the Funds’ investment adviser(s) and any entity controlling, controlled by, or under common control with the investment adviser(s) that provides ongoing services to the Funds (collectively, “Service Affiliates”).
Under Section 202 of the Sarbanes-Oxley Act of 2002, all audit and non-audit services provided to the Funds by the Auditor must be preapproved by the Audit Committee. Rule 2-01 of Regulation S-X requires that the Audit Committee also pre-approve a Service Affiliate’s engagement of the Auditor for non-audit services if the engagement relates directly to the operations and financial reporting of the Funds (a “Service Affiliate’s Covered Engagement”).
These Procedures set forth the procedures and the conditions pursuant to which the Audit Committee may pre-approve audit and non-audit services for the Funds and a Service Affiliate’s Covered Engagement pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”) and other organizations and regulatory bodies applicable to the Funds (“Applicable Rules”).1 They address both general pre-approvals without consideration of specific case-by-case services (“general pre-approvals”) and pre-approvals on a case-by-case basis (“specific pre-approvals”). Any services requiring pre-approval that are not within the scope of general pre-approvals hereunder are subject to specific pre-approval. These Procedures also address the delegation by the Audit Committee of pre-approval authority to the Audit Committee Chair or Vice Chair.
| | II. | Pre-Approval of Fund Audit Services |
The annual Fund audit services engagement, including terms and fees, is subject to specific pre-approval by the Audit Committee. Audit services include the annual financial statement audit and other procedures required to be performed by an independent auditor to be able to form an opinion on the Funds’ financial statements. The Audit Committee will receive, review and consider sufficient information concerning a proposed Fund audit engagement to make a reasonable evaluation of the Auditor’s qualifications and independence. The Audit Committee will oversee the Fund audit services engagement as necessary, including approving any changes in terms, audit scope, conditions and fees.
In addition to approving the Fund audit services engagement at least annually and specifically approving any changes, the Audit Committee may generally or specifically pre-approve engagements for other audit services, which are those services that only an independent auditor reasonably can provide. Other audit services may include services associated with SEC registration statements, periodic reports and other documents filed with the SEC.
| 1 | Applicable Rules include, for example, New York Stock Exchange (“NYSE”) rules applicable to closed-end funds managed by Invesco and listed on NYSE. |
| | III. | General and Specific Pre-Approval of Non-Audit Fund Services |
The Audit Committee will consider, at least annually, the list of General Pre-Approved Non-Audit Services which list may be terminated or modified at any time by the Audit Committee. To inform the Audit Committee’s review and approval of General Pre-Approved Non-Audit Services, the Funds’ Treasurer (or his or her designee) and Auditor shall provide such information regarding independence or other matters as the Audit Committee may request.
Any services or fee ranges that are not within the scope of General Pre-Approved Non-Audit Services have not received general pre-approval and require specific pre-approval. Each request for specific pre-approval by the Audit Committee for services to be provided by the Auditor to the Funds must be submitted to the Audit Committee by the Funds’ Treasurer (or his or her designee) and must include detailed information about the services to be provided, the fees or fee ranges to be charged, and other relevant information sufficient to allow the Audit Committee to consider whether to pre-approve such engagement, including evaluating whether the provision of such services will impair the independence of the Auditor and is otherwise consistent with Applicable Rules.
| | IV. | Non-Audit Service Types |
The Audit Committee may provide either general or specific pre-approval of audit-related, tax or other services, each as described in more detail below.
“Audit-related services” are assurance and related services that are reasonably related to the performance of the audit or review of the Fund’s financial statements or that are traditionally performed by an independent auditor. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters not classified as “Audit services”; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities; services related to mergers, acquisitions or dispositions; compliance with ratings agency requirements and interfund lending activities; and assistance with internal control reporting requirements.
“Tax services” include, but are not limited to, the review and signing of the Funds’ federal tax returns, the review of required distributions by the Funds and consultations regarding tax matters such as the tax treatment of new investments or the impact of new regulations. The Audit Committee will not approve proposed services of the Auditor which the Audit Committee believes are to be provided in connection with a service or transaction initially recommended by the Auditor, the sole business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. The Audit Committee will consult with the Funds’ Treasurer (or his or her designee) and may consult with outside counsel or advisers as necessary to ensure the consistency of tax services rendered by the Auditor with the foregoing policy. The Auditor shall not represent any Fund or any Service Affiliate before a tax court, district court or federal court of claims.
Each request to provide tax services under either the general or specific pre-approval of the Audit Committee will include a description from the Auditor in writing of (i) the scope of the service, the fee structure for the engagement, and any side letter or other amendment to the engagement letter, or any other agreement (whether oral, written, or otherwise) between the Auditor and the Funds, relating to the service; and (ii) any compensation arrangement or other agreement, such as a referral agreement, a referral fee or fee-sharing arrangement, between the Auditor (or an affiliate of the Auditor) and any person (other than the Funds or Service Affiliates receiving the services) with respect to the promoting, marketing, or recommending of a transaction covered by the service. The Auditor will also discuss with the Audit Committee the potential effects of the services on the independence of the Auditor, and document the substance of its discussion with the Audit Committee.
The Audit Committee may pre-approve other non-audit services so long as the Audit Committee believes that the service will not impair the independence of the Auditor. Appendix I includes a list of services that the Auditor is prohibited from performing by the SEC rules. Appendix I also includes a list of services that would impair the Auditor’s independence unless the Audit Committee reasonably concludes that the results of the services will not be subject to audit procedures during an audit of the Funds’ financial statements.
| | V. | Pre-Approval of Service Affiliate’s Covered Engagements |
Rule 2-01 of Regulation S-X requires that the Audit Committee pre-approve a Service Affiliate’s engagement of the Auditor for non-audit services if the engagement relates directly to the operations and financial reporting of the Funds, defined above as a “Service Affiliate’s Covered Engagement”.
The Audit Committee may provide either general or specific pre-approval of any Service Affiliate’s Covered Engagement, including for audit-related, tax or other services, as described above, if the Audit Committee believes that the provision of the services to a Service Affiliate will not impair the independence of the Auditor with respect to the Funds. Any Service Affiliate’s Covered Engagements that are not within the scope of General Pre-Approved Non-Audit Services have not received general pre-approval and require specific pre-approval.
Each request for specific pre-approval by the Audit Committee of a Service Affiliate’s Covered Engagement must be submitted to the Audit Committee by the Funds’ Treasurer (or his or her designee) and must include detailed information about the services to be provided, the fees or fee ranges to be charged, a description of the current status of the pre-approval process involving other audit committees in the Invesco investment company complex (as defined in Rule 2-201 of Regulation S-X) with respect to the proposed engagement, and other relevant information sufficient to allow the Audit Committee to consider whether the provision of such services will impair the independence of the Auditor from the Funds. Additionally, the Funds’ Treasurer (or his or her designee) and the Auditor will provide the Audit Committee with a statement that the proposed engagement requires pre-approval by the Audit Committee, the proposed engagement, in their view, will not impair the independence of the Auditor and is consistent with Applicable Rules, and the description of the proposed engagement provided to the Audit Committee is consistent with that presented to or approved by the Invesco audit committee.
Information about all Service Affiliate engagements of the Auditor for non-audit services, whether or not subject to pre-approval by the Audit Committee, shall be provided to the Audit Committee at least quarterly, to allow the Audit Committee to consider whether the provision of such services is compatible with maintaining the Auditor’s independence from the Funds. The Funds’ Treasurer and Auditor shall provide the Audit Committee with sufficiently detailed information about the scope of services provided and the fees for such services, to ensure that the Audit Committee can adequately consider whether the provision of such services is compatible with maintaining the Auditor’s independence from the Funds.
| | VI. | Pre-Approved Fee Levels or Established Amounts |
Pre-approved fee levels or ranges for audit and non-audit services to be provided by the Auditor to the Funds, and for a Service Affiliate’s Covered Engagement, under general pre-approval or specific pre-approval will be set periodically by the Audit Committee. Any proposed fees exceeding 110% of the maximum pre-approved fee levels or ranges for such services or engagements will be promptly presented to the Audit Committee and will require specific pre-approval by the Audit Committee before payment of any additional fees is made.
The Audit Committee may from time to time delegate specific pre-approval authority to its Chair and/or Vice Chair, so that the Chair or, in his or her absence, Vice Chair may grant specific pre-approval for audit and non-audit services by the Auditor to the Funds and/or a Service Affiliate’s Covered Engagement between Audit Committee meetings. Any such delegation shall be reflected in resolutions adopted by the Audit Committee and may include such limitations as to dollar amount(s) and/or scope of service(s) as the Audit Committee may choose to impose. Any such delegation shall not preclude the Chair or Vice Chair from declining, on a case by case basis, to exercise his or her delegated authority and instead convening the Audit Committee to consider and pre-approve any proposed services or engagements.
Notwithstanding the foregoing, any non-audit services to be provided to the Funds for which the fees are estimated to exceed $500,000 and any Service Affiliate’s Covered Engagement for which the fees are estimated to exceed $500,000 must be pre-approved by the Audit Committee and may not be delegated to the Chair or Vice Chair.
| | VIII. | Compliance with Procedures |
Notwithstanding anything herein to the contrary, failure to pre-approve any services or engagements that are not required to be pre-approved pursuant to the de minimis exception provided for in Rule 2-01(c)(7)(i)(C) of Regulation S-X shall not constitute a violation of these Procedures. The Audit Committee has designated the Funds’ Treasurer to ensure services and engagements are pre-approved in compliance with these Procedures. The Funds’ Treasurer will immediately report to the Chair of the Audit Committee, or the Vice Chair in his or her absence, any breach of these Procedures that comes to the attention of the Funds’ Treasurer or any services or engagements that are not required to be pre-approved pursuant to the de minimis exception provided for in Rule 2-01(c)(7)(i)(C) of Regulation S-X.
On at least an annual basis, the Auditor will provide the Audit Committee with a summary of all non-audit services provided to any entity in the investment company complex (as defined in section 2-01(f)(14) of Regulation S-X, including the Funds and Service Affiliates) that were not pre-approved, including the nature of services provided and the associated fees.
| | IX. | Amendments to Procedures |
All material amendments to these Procedures must be approved in advance by the Audit Committee. Non-material amendments to these Procedures may be made by the Legal and Compliance Departments and will be reported to the Audit Committee at the next regularly scheduled meeting of the Audit Committee.
Appendix I
Non-Audit Services That May Impair the Auditor’s Independence
The Auditor is not independent if, at any point during the audit and professional engagement, the Auditor provides the following non-audit services:
| | • | | Broker-dealer, investment adviser, or investment banking services; |
| | • | | Expert services unrelated to the audit; |
| | • | | Any service or product provided for a contingent fee or a commission; |
| | • | | Services related to marketing, planning, or opining in favor of the tax treatment of confidential transactions or aggressive tax position transactions, a significant purpose of which is tax avoidance; |
| | • | | Tax services for persons in financial reporting oversight roles at the Fund; and |
| | • | | Any other service that the Public Company Oversight Board determines by regulation is impermissible. |
An Auditor is not independent if, at any point during the audit and professional engagement, the Auditor provides the following non-audit services unless it is reasonable to conclude that the results of the services will not be subject to audit procedures during an audit of the Funds’ financial statements:
| | • | | Bookkeeping or other services related to the accounting records or financial statements of the audit client; |
| | • | | Financial information systems design and implementation; |
| | • | | Appraisal or valuation services, fairness opinions, or contribution-in-kind reports; |
| | • | | Actuarial services; and |
| | • | | Internal audit outsourcing services. |
| ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. |
| | (a) | The registrant has a separately-designed standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended. Members of the audit committee are: David C. Arch, Bruce L. Crockett, Cynthia Hostetler, Teresa M. Ressel, Raymond Stickel, Jr. and Robert C. Troccoli. |
| ITEM 6. | SCHEDULE OF INVESTMENTS. |
Investments in securities of unaffiliated issuers is included as part of the reports to stockholders filed under Item 1 of this Form.
| ITEM 7. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
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| | Invesco’s Policy Statement on Global Corporate Governance and Proxy Voting |
| I. | Guiding Principles and Philosophy |
Public companies hold shareholder meetings, attended by the company’s executives, directors, and shareholders, during which important issues, such as appointments to the company’s board of directors, executive compensation, and auditors, are addressed and where applicable, voted on. Proxy voting gives shareholders the opportunity to vote on issues that impact the company’s operations and policies without being present at the meetings.
Invesco views proxy voting as an integral part of its investment management responsibilities and believes that the right to vote proxies should be managed with the same high standards of care and fiduciary duty to its clients as all other elements of the investment process. Invesco’s proxy voting philosophy, governance structure and process are designed to ensure that proxy voles are cast in accordance with clients’ best interests, which Invesco interprets to mean clients’ best economic interests, this Policy and the operating guidelines and procedures of Invesco’s regional investment centers.
Invesco investment teams vote proxies on behalf of Invesco-sponsored funds and non-fund advisory clients that have explicitly granted Invesco authority in writing to vote proxies on their behalf.
The proxy voting process at Invesco, which is driven by investment professionals, Focuses on maximizing long-term value for our clients, protecting clients’ rights and promoting governance structures and practices that reinforce the accountability of corporate management and boards of directors to shareholders. Invesco takes a nuanced approach to voting and, therefore, many matters to be voted upon are reviewed on a case by case basis.
Votes in favor of board or management proposals should not be interpreted as an indication of insufficient consideration by lnvesco fund managers. Such votes may reflect the outcome of past or ongoing engagement and active ownership by Invesco with representatives of the companies in which we invest.
| II. | Applicability of this Policy |
This Policy sets forth the framework of Invesco’s corporate governance approach, broad philosophy and guiding principles that inform the proxy voting practices of Invesco’s investment teams around the world. Given the different nature of these teams and their respective investment processes, as well as the significant differences in regulatory regimes and market practices across jurisdictions, not all aspects of this Policy may apply to all Invesco investment teams at all times. In the case of a conflict between this Policy and the operating guidelines and procedures of a regional investment center the latter will control.
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| III. | Proxy Voting for Certain Fixed Income, Money Market Accounts and Index |
For proxies held by certain client accounts managed in accordance with fixed income, money market and index strategies (including exchange traded funds), lnvesco will typically vote in line with the majority holder of the active-equity shares held by Invesco outside of those strategies (“Majority Voting”). In this manner Invesco seeks to leverage the active-equity expertise and comprehensive proxy voting reviews conducted by teams employing active-equity strategies, which typically incorporate analysis of proxy issues as a core component of the investment process. Portfolio managers for accounts employing Majority Voting still retain full discretion to override Majority Voting and to vote the shares as they determine to be in the best interest of those accounts, absent certain types of conflicts of interest, which are discussed elsewhere in this Policy.
There may be occasions where voting proxies may present a real or perceived conflict of interest between Invesco, as investment manager, and one or more of Invesco’s clients or vendors. Under Invesco’s Code of Conduct, Invesco entities and individuals are strictly prohibited from putting personal benefit, whether tangible or intangible, before the interests of clients. “Personal benefit” includes any intended benefit for Invesco, oneself or any other individual, company, group or organization of any kind whatsoever, except a benefit for the relevant lnvesco client.
Firm-level Conflicts of Interest
A conflict of interest may exist if Invesco has a material business relationship with, or is actively soliciting business from, either the company soliciting a proxy or a third party that has a material interest in the outcome of a proxy vote or that is actively lobbying for a particular outcome of a proxy vote (e.g., issuers that are distributors of Invesco’s products, or issuers that employ lnvesco to manage portions of their retirement plans or treasury accounts). Invesco’s proxy governance team maintains a list of all such issuers for which a conflict of interest exists.
If the proposal that gives rise to the potential conflict is specifically addressed by this Policy or the operating guidelines and procedures of the relevant regional investment center, Invesco generally will vote the proxy in accordance therewith. Otherwise, based on a majority vote of its members, the Global IPAC (as described below) will vote the proxy.
Because this Policy and the operating guidelines and procedures of each regional investment center are pre-determined and crafted to be in the best economic interest of clients, applying them to vote client proxies should, in most instances, adequately resolve any potential conflict of interest. As an additional safeguard, persons from Invesco’s marketing, distribution and other customer-facing functions may not serve on the Global IPAC. For the avoidance of doubt, Invesco may not consider Invesco Ltd.’s pecuniary interest when voting proxies on behalf of clients.
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Personal Conflicts of Interest
A conflict also may exist where an Invesco employee has a known personal relationship with other proponents of proxy proposals, participants in proxy contests, corporate directors, or candidates for directorships.
All Invesco personnel with proxy voting responsibilities are required to report any known personal conflicts of interest regarding proxy issues with which they are involved. In such instances, the individual(s) with the conflict will be excluded from the decision-making process relating to such issues.
Other Conflicts of Interest
In order to avoid any appearance of a conflict of interest, Invesco will not vote proxies issued by, or related to matters involving, Invesco Ltd. that may be held in client accounts from time to time.1 Shares of an Invesco-sponsored fund held by other lnvesco funds will be voted in the same proportion as the votes of external shareholders of the underlying fund.
| V. | Use of Third-Party Proxy Advisory Services |
Invesco may supplement its internal research with information from third-parties, such as proxy advisory firms. However, Invesco generally retains full and independent discretion with respect to proxy voting decisions.
As part of its fiduciary obligation to clients, Invesco performs extensive initial and ongoing due diligence on the proxy advisory firms it engages. This includes reviews of information regarding the capabilities of their research staffs and internal controls, policies and procedures, including those relating to possible conflicts of interest. In addition, lnvesco regularly monitors and communicates with these firms and monitors their compliance with Invesco’s performance and policy standards.
| VI. | Global Proxy Voting Platform and Administration |
Guided by its philosophy that investment teams should manage proxy voting, Invesco has created the Global lnvesco Proxy Advisory Committee (“Global IPAC”). The Global IPAC is a global investments-driven committee comprised of representatives from various investment management teams and Invesco’s Global Head of Proxy Governance and Responsible Investment (“Head of Proxy Governance”). The Global IPAC provides a forum for investment teams to monitor, understand and discuss key proxy issues and voting trends within the lnvesco complex. Absent a conflict of interest, the Global IPAC representatives, in consultation with the respective investment team, are responsible for voting proxies for the securities the team manages (unless such responsibility is explicitly delegated to the portfolio managers of the securities in question) In addition to the Global IPAC, for some clients, third parties (e.g., U.S. mutual fund boards) provide oversight of the proxy process. The Global IPAC and Invesco’s
| 1 | Generally speaking, Invesco does not invest for its clients in the shares of Invesco Ltd., however, limited exceptions apply in the case of funds or accounts designed to track an index that includes Invesco Ltd. as a component. |
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proxy administration and governance team, compliance and legal teams regularly communicate and review this Policy and the operating guidelines and procedures of each regional investment center to ensure that they remain consistent with clients’ best interests, regulatory requirements, governance trends and industry best practices.
Invesco maintains a proprietary global proxy administration platform, known as the “fund manager portal” and supported by the Head of Proxy Governance and a dedicated team of internal proxy specialists. The platform streamlines the proxy voting and ballot reconciliation processes, as well as related functions, such as share blocking and managing conflicts of interest issuers. Managing these processes internally, as opposed to relying on third parties, gives Invesco greater quality control, oversight and independence in the proxy administration process.
The platform also includes advanced global reporting and record-keeping capabilities regarding proxy matters that enable Invesco to satisfy client, regulatory and management requirements. Historical proxy voting information, including commentary by investment professionals regarding the votes they cast, where applicable, is stored to build institutional knowledge across the Invesco complex with respect to individual companies and proxy issues. Certain investment teams also use the platform to access third-party proxy research.
In the great majority of instances, Invesco is able to vote proxies successfully. However, in certain circumstances Invesco may refrain from voting where the economic or other opportunity costs of voting exceeds any anticipated benefits of that proxy proposal. In addition, there may be instances in which Invesco is unable to vote all of its clients’ proxies despite using commercially reasonable efforts to do so. For example:
| • | | Invesco may not receive proxy materials from the relevant fund or client custodian with sufficient time and information to make an informed independent voting decision. In such cases, Invesco may choose not to vote, to abstain from voting, to vote in line with management or to vote in accordance with proxy advisor recommendations. These matters are left to the discretion of the fund manager. |
| • | | If the security in question is on loan as part of a securities lending program, lnvesco may determine that the benefit to the client of voting a particular proxy is outweighed by the revenue that would be lost by terminating the loan and recalling the securities. |
| • | | In some countries the exercise of voting rights imposes temporary transfer restrictions on the related securities (“share blocking”). Invesco generally refrains from voting proxies in share-blocking countries unless Invesco determines that the benefit to the client(s) of voting a specific proxy outweighs the client’s temporary inability to sell the security. |
| • | | Some companies require a representative to attend meetings in person in order to vote a proxy. In such cases, Invesco may determine that the costs of sending a representative or signing a power-of-attorney outweigh the benefit of voting a particular proxy. |
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| VIII. | Proxy Voting Guidelines |
The following guidelines describe Invesco’s general positions on various common proxy voting issues. This list is not intended to be exhaustive or prescriptive. As noted above, Invesco’s proxy process is investor-driven, and each fund manager retains ultimate discretion to vote proxies in the manner they deem most appropriate, consistent with Invesco’s proxy voting principles and philosophy discussed in Sections I through IV. Individual proxy votes therefore will differ from these guidelines from time to time.
| A. | Shareholder Access and Treatment of Shareholder Proposals |
Invesco reviews on a case by case basis but generally votes in favor of proposals that would increase shareholders’ opportunities to express their views to boards of directors, proposals that would lower barriers to shareholder action, and proposals to promote the adoption of generally accepted best practices in corporate governance, provided that such proposals would not require a disproportionate amount of management attention or corporate resources or otherwise that may inappropriately disrupt the company’s business and main purpose. usually set out in their reporting disclosures and business model. Likewise, Invesco reviews on a case by case basis but generally votes for shareholder proposals that are designed to protect shareholder rights if a company’s corporate governance standards indicate that such additional protections are warranted (for example, where minority shareholders’ rights are not adequately protected).
| B. | Environmental, Social and Corporate Responsibility Issues |
Invesco believes that a company’s long-term response to environmental, social and corporate responsibility issues can significantly affect its long-term shareholder value. We recognize that to manage a corporation effectively, directors and management may consider not only the interests of shareholders, but also the interests of employees, customers, suppliers, creditors and the local community, among others. While Invesco generally affords management discretion with respect to the operation of a company’s business, Invesco will evaluate such proposals on a case by case basis and will vote proposals relating to these issues in a manner intended to maximize long-term shareholder value.
| C. | Capitalization Structure Issues |
Invesco generally supports a board’s decisions about the need for additional capital stock to meet ongoing corporate needs, except where the request could adversely affect Invesco clients’ ownership stakes or voting rights. Some capitalization proposals, such as those to authorize common or preferred stock with special voting rights or to issue additional stock in connection with an acquisition, may require additional analysis. lnvesco generally opposes proposals to authorize classes of preferred stock with unspecified voting, conversion, dividend or other rights (“blank check” stock) when they appear to be intended as an anti-takeover mechanism; such issuances may be supported when used for general financing purposes.
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Invesco generally supports a board’s proposal to increase common share authorization for a stock split, provided that the increase in authorized shares would not result in excessive dilution given the company’s industry and performance in terms of shareholder returns.
lnvesco generally supports a board’s proposal to institute open-market share repurchase plans only if all shareholders participate on an equal basis.
| D. | Corporate Governance Issues |
i. Board of Directors
| | 1. | Director Nominees in Uncontested Elections |
Subject to the other considerations described below, in an uncontested director election for a company without a controlling shareholder, lnvesco generally votes in favor of the director slate if it is comprised of at least a majority of independent directors and if the board’s key committees are fully independent, effective and balanced. Key committees include the audit, compensation/remuneration and governance/nominating committees. lnvesco’s standard of independence excludes directors who, in addition to the directorship, have any material business or family relationships with the companies they serve.
| | 2. | Director Nominees in Contested Elections |
Invesco recognizes that short-term investment sentiments influence the corporate governance landscape and may influence companies in Invesco clients’ portfolios and more broadly across the market. Invesco recognizes that short-term investment sentiment may conflict with long-term value creation and as such looks at each proxy contest matter on a case by case basis, considering factors such as:
| | • | | Long-term financial performance of the company relative to its industry, |
| | • | | Management’s track record, |
| | • | | Background to the proxy contest, |
| | • | | Qualifications of director nominees (both slates), |
| | • | | Evaluation of what each side is offering shareholders as well as the likelihood that the proposed objectives and goals can be met, and |
| | • | | Stock ownership positions in the company. |
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| | 3. | Director Accountability |
Invesco generally withholds votes from directors who exhibit a lack of accountability to shareholders. Examples include, without limitation, poor attendance (less than 75%, absent extenuating circumstances) at meetings, failing to implement shareholder proposals that have received a majority of votes and/or by adopting or approving egregious corporate-governance or other policies. In cases of material financial restatements, accounting fraud, habitually late filings, adopting shareholder rights plan (“poison pills”) without shareholder approval, or other areas of poor performance, Invesco may withhold votes from some or all of a company’s directors. In situations where directors’ performance is a concern, Invesco may also support shareholder proposals to take corrective actions such as so-called “clawback” provisions.
lnvesco generally supports proposals to require a majority of directors to be independent unless particular circumstances make this not Feasible or in the best interests of shareholders, We generally vote for proposals that would require the board’s audit, compensation/remuneration, and/or governance/nominating committees to be composed exclusively of independent directors since this minimizes the potential for conflicts of interest.
| | 5. | Director Indemnification |
Invesco recognizes that individuals may be reluctant to serve as corporate directors if they are personally liable for all related lawsuits and legal costs. As a result, reasonable limitations on directors’ liability can benefit a company and its shareholders by helping to attract and retain qualified directors while preserving recourse for shareholders in the event of misconduct by directors, Invesco, therefore, generally supports proposals to limit directors’ liability and provide indemnification and/or exculpation, provided that the arrangements are limited to the director acting honestly and in good faith with a view to the best interests of the company and, in criminal matters, are limited to the director having reasonable grounds for believing the conduct was lawful.
| | 6. | Separate Chairperson and CEO |
Invesco evaluates these proposals on a case by case basis, recognizing that good governance requires either an independent chair or a qualified, proactive, and lead independent director.
Voting decisions may take into account, among other factors, the presence or absence of:
| | • | | a designated lead director, appointed from the ranks of the independent board members, with an established term of office and clearly delineated powers and duties; |
| | • | | a majority of independent directors; |
| | • | | completely independent key committees; |
| | • | | committee chairpersons nominated by the independent directors; |
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| | • | | CEO performance reviewed annually by a committee of independent directors; and |
| | • | | established governance guidelines. |
| | 7. | Majority/Supermajority/Cumulative Voting for Directors |
The right to elect directors is the single most important mechanism shareholders have to promote accountability. Invesco generally votes in favor of proposals to elect directors by a majority vote. Except in cases where required by law in the jurisdiction of incorporation or when a company has adopted formal governance principles that present a meaningful alternative to the majority voting standard, Invesco generally votes against actions that would impose any supermajority voting requirement. and generally supports actions to dismantle existing supermajority requirements.
The practice of cumulative voting can enable minority shareholders to have representation on a company’s board. Invesco generally opposes such proposals as unnecessary where the company has adopted a majority voting standard. However, Invesco generally supports proposals to institute the practice of cumulative voting at companies whose overall corporate-governance standards indicate a particular need to protect the interests of minority shareholders.
| | 8. | Staggered Boards/Annual Election of Directors |
Invesco generally supports proposals to elect each director annually rather than electing directors to staggered multi-year terms because annual elections increase a board’s level of accountability to its shareholders.
lnvesco believes that the number of directors is an important factor to consider when evaluating the board’s ability to maximize long-term shareholder value. Invesco approaches proxies relating to board size on a case by case basis but generally will defer to the board with respect to determining the optimal number of board members, provided that the proposed board size is sufficiently large to represent shareholder interests and sufficiently limited to remain effective.
| | 10. | Term Limits for Directors |
lnvesco believes it is important for a board of directors to examine its membership regularly with a view to ensuring that the company continues to benefit from a diversity of director viewpoints and experience. We generally believe that an individual board’s nominating committee is best positioned to determine whether director term limits would be an appropriate measure to help achieve these goals and, if so, the nature of such limits.
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ii. Audit Committees and Auditors
| | 1. | Qualifications of Audit Committee and Auditors |
Invesco believes a company’s Audit Committee has a high degree of responsibility to shareholders in matters of financial disclosure, integrity of the financial statements and effectiveness of a company’s internal controls. Independence. experience and financial expertise are critical elements of a well-functioning Audit Committee. When electing directors who are members of a company’s Audit Committee, or when ratifying a company’s auditors, Invesco considers the past performance of the Audit Committee and holds its members accountable for the quality of the company’s financial statements and reports.
| | 2. | Auditor Indemnifications |
A company’s independent auditors play a critical role in ensuring and attesting to the integrity of the company’s financial statements. It is therefore essential that they perform their work in accordance with the highest standards. Invesco generally opposes proposals that would limit the liability of or indemnify auditors because doing so could serve to undermine this obligation.
| | 3. | Adequate Disclosure of Auditor Fees |
Understanding the fees earned by the auditors is important for assessing auditor independence. Invesco’s support for the re-appointment of the auditors will take into consideration the availability of adequate disclosure concerning the amount and nature of audit versus non-audit fees. Invesco generally will support proposals that call for this disclosure if it is not already being made.
| E. | Remuneration and Incentives |
Invesco believes properly constructed compensation plans that include equity ownership are effective in creating incentives that induce management and employees of portfolio companies to create greater shareholder wealth. Invesco generally supports equity compensation plans that promote the proper alignment of incentives with shareholders’ long-term interests! and generally votes against plans that are overly dilutive to existing shareholders, plans that contain objectionable structural features. and plans that appear likely to reduce the value of the client’s investment.
i. Independent Compensation/Remuneration Committee
Invesco believes that an independent, experienced and well-informed compensation/remuneration committee is critical to ensuring that a company’s remuneration practices align with shareholders’ interests and, therefore, generally supports proposals calling for a compensation/remuneration committee to be comprised solely of independent directors.
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ii. Advisory Votes on Executive Compensation
Invesco believes that an independent compensation/remuneration committee of the board, with input from management, is generally best positioned to determine the appropriate components and levels of executive compensation, as well as the appropriate frequency of related shareholder advisory votes. This is particularly the case where shareholders have the ability to express their views on remuneration matters through annual votes for or against the election of the individual directors who comprise the compensation/remuneration committee. Invesco, therefore, generally will support management’s recommendations with regard to the components and levels of executive compensation and the frequency of shareholder advisory votes on executive compensation. However, Invesco will vote against such recommendations where Invesco determines that a company’s executive remuneration policies are not properly aligned with shareholder interests or may create inappropriate incentives for management.
iii. Equity Based Compensation Plans
Invesco generally votes against plans that contain structural features that would impair the alignment of incentives between shareholders and management. Such features include, without limitation, the ability to reprice or reload options without shareholder approval, the ability to issue options below the stock’s current market price, or the ability to replenish shares automatically without shareholder approval.
iv. Severance Arrangements
lnvesco considers proposed severance arrangements (sometimes known as “golden parachute” arrangements) on a case-by-case basis due to the wide variety among their terms. Invesco acknowledges that in some cases such arrangements, if reasonable, may be in shareholders’ best interests as a method of attracting and retaining high quality executive talent. lnvesco generally votes in favor of proposals requiring advisory shareholder ratification of senior executives’ severance agreements while generally opposing proposals that require such agreements to be ratified by shareholders in advance of their adoption.
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v. “Claw Back” Provisions
lnvesco generally supports so called “claw back” policies intended to recoup remuneration paid to senior executives based upon materially inaccurate financial reporting (as evidenced by later restatements) or fraudulent accounting or business practices.
vi. Employee Stock Purchase Plans
Invesco generally supports employee stock purchase plans that are reasonably designed to provide proper incentives to a broad base of employees, provided that the price at which employees may acquire stock represents a reasonable discount from the market price.
| F. | Anti-Takeover Defenses; Reincorporation |
Measures designed to protect a company from unsolicited bids can adversely affect shareholder value and voting rights, and they have the potential to create conflicts of interests among directors, management and shareholders. Such measures include adopting or renewing shareholder rights plans (“poison pills”), requiring supermajority voting on certain corporate actions, classifying the election of directors instead of electing each director to an annual term, or creating separate classes of common or preferred stock with special voting rights. In determining whether to support a proposal to add, eliminate or restrict anti-takeover measures, Invesco will examine the particular elements of the proposal to assess the degree to which it would adversely affect shareholder rights of adopted. Invesco generally supports shareholder proposals directing companies to subject their anti-takeover provisions to a shareholder vote. Invesco generally opposes payments by companies to minority shareholders intended to dissuade such shareholders from pursuing a takeover or other changes (sometimes known as “greenmail”) because these payments result in preferential treatment of some shareholders over others.
Reincorporation involves re-establishing the company in a different legal jurisdiction. Invesco generally will vote for proposals to reincorporate a company provided that the board and management have demonstrated sound financial or business reasons for the move. Invesco generally will oppose proposals to reincorporate if they are solely part of an anti-takeover defense or intended to limit directors’ liability.
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PROXY VOTING GUIDELINES
| | |
| Applicable to | | All Advisory Clients, including the Invesco Funds |
| Risk Addressed by the Guidelines | | Breach of fiduciary duty to client under Investment Advisers Act of 1940 by placing Invesco’s interests ahead of client’s best interests in voting proxies |
| Relevant Law and Other Sources | | U.S. Investment Advisers Act of 1940, as amended |
Last ☒Reviewed ☒Revised by Compliance for Accuracy | | April 19, 2016 |
| Guideline Owner | | U.S. Compliance and Legal |
| Policy Approver | | Invesco Advisers, Inc., Invesco Funds Board |
| Approved/Adopted Date | | May 3-4, 2016 |
The following guidelines apply to all institutional and retail funds and accounts that have explicitly authorized Invesco Advisers, Inc. (“Invesco”) to vote proxies associated with securities held on their behalf (collectively, “Clients”).
A. INTRODUCTION
Invesco Ltd. (“IVZ”), the ultimate parent company of Invesco, has adopted a global policy statement on corporate governance and proxy voting (the “Invesco Global Proxy Policy”). The policy describes IVZ’s views on governance matters and the proxy administration and governance approach. Invesco votes proxies by using the framework and procedures set forth in the Invesco Global Proxy Policy, while maintaining the Invesco-specific guidelines described below.
B. PROXY VOTING OVERSIGHT: THE MUTUAL FUNDS’ BOARD OF TRUSTEES
In addition to the Global Invesco Proxy Advisory Committee, the Invesco mutual funds’ board of trustees provides oversight of the proxy process through quarterly reporting and an annual in-person presentation by Invesco’s Global Head of Proxy Governance and Responsible Investment.
C. USE OF THIRD PARTY PROXY ADVISORY SERVICES
Invesco has direct access to third-party proxy advisory analyses and recommendations (currently provided by Glass Lewis (“GL”) and Institutional Shareholder Services, Inc. (“ISS”)), among other research tools, and uses the information gleaned from those sources to make independent voting decisions.
Invesco’s proxy administration team performs extensive initial and ongoing due diligence on the proxy advisory firms that it engages. When deemed appropriate, representatives from the proxy advisory firms are asked to deliver updates directly to the mutual funds’ board of trustees. Invesco conducts semi-annual, in-person policy roundtables with key heads of research from ISS and GL to ensure transparency, dialogue and engagement with the firms. These meetings provide Invesco with an opportunity to assess the firms’ capabilities, conflicts of interest and service levels, as well as provide investment professionals with direct insight into the advisory firms’ stances on key governance and proxy topics and their policy framework/methodologies. Invesco’s proxy administration team also reviews the annual SSAE 16 reports for, and the periodic proxy guideline updates published by, each proxy advisory firm to ensure that their guidelines remain consistent with Invesco’s policies and procedures. Furthermore, each proxy advisory firm completes an annual due diligence questionnaire submitted by Invesco, and Invesco conducts on-site due diligence at each firm, in part to discuss their responses to the questionnaire.
If Invesco becomes aware of any material inaccuracies in the information provided by ISS or GL, Invesco’s proxy administration team will investigate the matter to determine the cause, evaluate the adequacy of the proxy advisory firm’s control structure and assess the efficacy of the measures instituted to prevent further errors.
ISS and GL provide updates to previously issued proxy reports when necessary to incorporate newly available information or to correct factual errors. ISS also has a Feedback Review Board, which provides a mechanism for stakeholders to communicate with ISS about issues related to proxy voting and policy formulation, research, and the accuracy of data contained in ISS reports.
D. PROXY VOTING GUIDELINES
The following guidelines describe Invesco’s general positions on various common proxy issues. The guidelines are not intended to be exhaustive or prescriptive. Invesco’s proxy process is investor-driven, and each portfolio manager retains ultimate discretion to vote proxies in the manner that he or she deems to be the most appropriate, consistent with the proxy voting principles and philosophy discussed in the Invesco Global Proxy Policy. Individual proxy votes therefore will differ from these guidelines from time to time.
Management teams of companies are accountable to the boards of directors and directors of publicly held companies are accountable to shareholders. Invesco endeavors to vote the proxies of companies in a manner that will reinforce the notion of a board’s accountability. Consequently, Invesco generally votes against any actions that would impair the rights of shareholders or would reduce shareholders’ influence over the board.
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The following are specific voting issues that illustrate how Invesco applies this principle of accountability.
Elections of directors
In uncontested director elections for companies that do not have a controlling shareholder, Invesco generally votes in favor of slates if they are comprised of at least a majority of independent directors and if the boards’ key committees are fully independent. Key committees include the audit, compensation and governance or nominating Committees. Invesco’s standard of independence excludes directors who, in addition to the directorship, have any material business or family relationships with the companies they serve. Contested director elections are evaluated on a case-by-case basis.
Director performance
Invesco generally withholds votes from directors who exhibit a lack of accountability to shareholders, either through their Level of attendance at meetings or by adopting or approving egregious corporate-governance or other policies. In cases of material financial restatements, accounting fraud, habitually late filings, adopting shareholder rights plan (“poison pills”) without shareholder approval, or other areas of poor performance, Invesco may withhold votes from some or all of a company’s directors. In situations where directors’ performance is a concern, Invesco may also support shareholder proposals to take corrective actions, such as so-called “clawback” provisions.
Auditors and Audit Committee members
Invesco believes a company’s audit committee has a high degree of responsibility to shareholders in matters of financial disclosure, integrity of the financial statements and effectiveness of a company’s internal controls. Independence, experience and financial expertise are critical elements of a well-functioning audit committee. When electing directors who are members of a company’s audit committee, or when ratifying a company’s auditors, Invesco considers the past performance of the committee and holds its members accountable for the quality of the company’s financial statements and reports.
Majority standard in director elections
The right to elect directors is the single most important mechanism shareholders have to promote accountability. Invesco supports the nascent effort to reform the U.S. convention of electing directors, and generally votes in favor of proposals to elect directors by a majority vote.
Staggered Boards/Annual Election of Directors
Invesco generally supports proposals to elect each director annually rather than electing directors to staggered multi-year terms because annual elections increase a board’s level of accountability to its shareholders.
Supermajority voting requirements
Unless required by law in the state of incorporation, Invesco generally votes against actions that would impose any supermajority voting requirement, and generally supports actions to dismantle existing supermajority requirements.
Responsiveness of Directors
Invesco generally withholds votes for directors who do not adequately respond to shareholder proposals that were approved by a majority of votes cast the prior year.
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Cumulative voting
The practice of cumulative voting can enable minority shareholders to have representation on a company’s board, Invesco generally supports proposals to institute the practice of cumulative voting at companies whose overall corporate-governance standards indicate a particular need to protect the interests of minority shareholders.
Proxy access
Invesco generally supports shareholders’ nominations of directors in the proxy statement and ballot because it increases the accountability of the board to shareholders. Invesco will generally consider the proposed minimum period of ownership (e.g., three years), minimum ownership percentage (e.g., three percent), limitations on a proponent’s ability to aggregate holdings with other shareholders and the maximum percentage of directors who can be nominated when determining how to vote on proxy access proposals.
Shareholder access
On business matters with potential financial consequences, Invesco generally votes in favor of proposals that would increase shareholders’ opportunities to express their views to boards of directors, proposals that would lower barriers to shareholder action and proposals to promote the adoption of generally accepted best practices in corporate governance. Furthermore, Invesco generally votes for shareholder proposals that are designed to protect shareholder rights if a company’s corporate governance standards indicate that such additional protections are warranted.
Exclusive Forum
Invesco generally supports proposals that would designate a specific jurisdiction in company bylaws as the exclusive venue for certain types of shareholder lawsuits in order to reduce costs arising out of multijurisdidional litigation.
| | II. | Compensation and Incentives |
Invesco believes properly constructed compensation plans that include equity ownership are effective in creating incentives that induce management and employees of companies to create greater shareholder wealth. Invesco generally supports equity compensation plans that promote the proper alignment of incentives with shareholders’ long-term interests, and generally votes against plans that are overly dilutive to existing shareholders, plans that contain objectionable structural features, and plans that appear likely to reduce the value of the Client’s investment.
Following are specific voting issues that illustrate how Invesco evaluates incentive plans.
Executive compensation
Invesco evaluates executive compensation plans within the context of the company’s performance under the executives’ tenure. Invesco believes independent compensation committees are best positioned to craft executive-compensation plans that are suitable for their company-specific circumstances. Invesco views the election of independent compensation committee members as the appropriate mechanism for shareholders to express their approval or disapproval of a company’s compensation practices. Therefore, Invesco generally does not support shareholder proposals to limit or eliminate certain forms of executive compensation. In the interest of reinforcing the notion of a compensation committee’s accountability to shareholders, Invesco generally supports proposals requesting that companies subject each year’s compensation record to an advisory shareholder vote, or so-called “say on pay” proposals.
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Equity-based compensation plans
Invesco generally votes against plans that contain structural features that would impair the alignment of incentives between shareholders and management. Such features include the ability to reprice or reload options without shareholder approval, the ability to issue options below the stock’s current market price, or the ability automatically to replenish shares without shareholder approval.
Employee stock-purchase plans
Invesco generally supports employee stock-purchase plans that are reasonably designed to provide proper incentives to a broad base of employees, provided that the price at which employees may acquire stock is at most a 15 percent discount from the market price.
Severance agreements
Invesco generally votes in favor of proposals requiring advisory shareholder ratification of executives’ severance agreements. However, Invesco generally opposes proposals requiring such agreements to be ratified by shareholders in advance of their adoption. Given the vast differences that may occur in these agreements, some severance agreements are evaluated on an individual basis.
Examples of management proposals related to a company’s capital structure include authorizing or issuing additional equity capital, repurchasing outstanding stock, or enacting a stock split or reverse stock split. On requests for additional capital stock, Invesco analyzes the company’s stated reasons for the request. Except where the request could adversely affect the Client’s ownership stake or voting rights, Invesco generally supports a board’s decisions on its needs for additional capital stock. Some capitalization proposals require a case-by-case analysis. Examples of such proposals include authorizing common or preferred stock with special voting rights, or issuing additional stock in connection with an acquisition.
| IV. | Mergers, Acquisitions and Other Corporate Actions |
Issuers occasionally require shareholder approval to engage in certain corporate actions such as mergers, acquisitions, name changes, dissolutions, reorganizations, divestitures and reincorporations and the votes for these types of corporate actions are generally determined on a case-by-case basis.
Practices designed to protect a company from unsolicited bids can adversely affect shareholder value and voting rights, and they potentially create conflicts of interests among directors, management and shareholders. Except under special issuer-specific circumstances, Invesco generally votes to reduce or eliminate such measures. These measures include adopting or renewing “poison pills”, requiring supermajority voting on certain corporate actions, classifying the election of directors instead of electing each director to an annual term, or creating separate classes of common or preferred stock with special voting rights. Invesco generally votes against management proposals to impose these types of measures, and generally votes for shareholder proposals designed to reduce such measures. Invesco generally supports shareholder proposals directing companies to subject their anti-takeover provisions to a shareholder vote.
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| VI. | Environmental, Social and Corporate Responsibility Issues |
Invesco believes that a company’s response to environmental, social and corporate responsibility issues and the risks attendant to them can have a significant effect on its long-term shareholder value. Invesco recognizes that to manage a corporation effectively, directors and management must consider not only the interest of shareholders, but also the interests of employees, customers, suppliers and creditors, among others. While Invesco generally affords management discretion with respect to the operation of a company’s business, Invesco will evaluate such proposals on a case-by-case basis and will vote proposals relating to these issues in a manner intended to maximize long-term shareholder value.
| VII. | Routine Business Matters |
Routine business matters rarely have the potential to have a material effect on the economic prospects of Clients’ holdings, so Invesco generally supports a board’s discretion on these items. However, Invesco generally votes against proposals where there is insufficient information to make a decision about the nature of the proposal. Similarly, Invesco generally votes against proposals to conduct other unidentified business at shareholder meetings.
Client Maintains Right to Vote Proxies
In the case of institutional or sub-advised Clients, Invesco will vote the proxies in accordance with these guidelines and the Invesco Global Proxy Policy, unless the Client retains in writing the right to vote or the named fiduciary of a Client (e.g., the plan sponsor of an ERISA Client) retains in writing the right to direct the plan trustee or a third party to vote proxies.
Voting for Certain Investment Strategies
For cash sweep investment vehicles selected by a Client but for which Invesco has proxy voting authority over the account and where no other Client holds the same securities, Invesco will vote proxies based on ISS recommendations.
Funds of Funds
Some Invesco Funds offering diversified asset allocation within one investment vehicle own shares in other Invesco Funds. A potential conflict of interest could arise if an underlying Invesco Fund has a shareholder meeting with any proxy issues to be voted on, because Invesco’s asset-allocation funds or target-maturity funds may be large shareholders of the underlying fund. In order to avoid any potential for a conflict, the asset-allocation funds and target maturity funds vote their shares in the same proportion as the votes of the external shareholders of the underlying fund.
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| F. | POLICIES AND VOTE DISCLOSURE |
A copy of these guidelines, the Invesco Global Proxy Policy and the voting record of each Invesco Retail Fund are available on Invesco’s web site, www.invesco.com. In accordance with Securities and Exchange Commission regulations, all Invesco Funds file a record of all proxy-voting activity for the prior 12 months ending June 30th. That filing is made on or before August 31st of each year. In the case of institutional and sub-advised Clients, Clients may contact their client service representative to request information about how Invesco voted proxies on their behalf. Absent specific contractual guidelines, such requests may be made on a semi-annual basis.
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| ITEM 8. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT COMPANIES. |
As of February 28, 2018, the following individuals are jointly and primarily responsible for the day-to-day management of the Fund:
| | • | | Scott Baskind, Portfolio Manager, who has been responsible for the Trust since 2013 and has been associated with Invesco Senior Secured and/or its affiliates since 1999. |
| | • | | Thomas Ewald, Portfolio Manager, who has been responsible for the Trust since 2010 and has been associated with Invesco Senior Secured and/or its affiliates since 2000. |
| | • | | Philip Yarrow, Portfolio Manager, who has been responsible for the Trust (or the predecessor Trust) since 2007 and has been associated with Invesco Senior Secured and/or its affiliates since 2010. |
Portfolio Manager Fund Holdings and Information on Other Managed Accounts
Invesco’s portfolio managers develop investment models which are used in connection with the management of certain Invesco Funds as well as other mutual funds for which Invesco or an affiliate acts as sub-adviser, other pooled investment vehicles that are not registered mutual funds, and other accounts managed for organizations and individuals. The ‘Investments’ chart reflects the portfolio managers’ investments in the Funds that they manage. Accounts are grouped into three categories: (i) investments in the Fund’s shares beneficially owned by a portfolio manager, as determined in accordance with Rule 16a-1(a) (2) under the Securities Exchange Act of 1934, as amended (beneficial ownership includes ownership by a portfolio manager’s immediate family members sharing the same household); (ii) investments made either directly or through a deferred compensation or similar plan in Invesco pooled investment vehicles with the same or similar objectives and strategies as the Fund; and (iii) total investments made in any Invesco Fund or Invesco pooled investment vehicle. The ‘Assets Managed’ chart reflects information regarding accounts other than the Funds for which each portfolio manager has day-to-day management responsibilities. Accounts are grouped into three categories: (i) other registered investment companies; (ii) other pooled investment vehicles; and (iii) other accounts. To the extent that any of these accounts pay advisory fees that are based on account performance (performance-based fees), information on those accounts is specifically noted. In addition, any assets denominated in foreign currencies have been converted into U.S. dollars using the exchange rates as of the applicable date.
Investments
The following information is as of February 28, 2018 (unless otherwise noted):
| | | | | | |
Portfolio Manager | | Dollar Range of
Investments in the Fund | | Dollar Range of
Investments in Invesco
Pooled Investment
Vehicles with the Same or
Similar Objectives and
Strategies as the Fund | | Dollar Range of
Investments in All Invesco
Funds and Invesco Pooled
Investment Vehicles |
Invesco Senior Loan Fund |
Scott Baskind | | $50,001 - $100,000 | | N/A | | Over $1,000,000 |
Thomas Ewald | | $10,001 - $50,000 | | N/A | | Over $1,000,000 |
Philip Yarrow | | $10,001 - $50,000 | | N/A | | $500,001 - $1,000,000 |
Assets Managed
The following information is as of February 28, 2018 (unless otherwise noted):
| | | | | | | | | | | | |
Portfolio Manager | | Other Registered Investment
Companies Managed | | Other Pooled Investment
Vehicles Managed | | Other
Accounts Managed |
| | Number
of
Accounts | | Assets
(in millions) | | Number
of
Accounts | | Assets
(in millions) | | Number
of
Accounts | | Assets
(in millions) |
Invesco Senior Loan Fund |
Scott Baskind | | 4 | | $12,915.2 | | 4 | | $10,564.4 | | 41 | | $12,998.0 |
Thomas Ewald | | 3 | | $3,856.3 | | 3 | | $10,110.3 | | None | | None |
Philip Yarrow | | 3 | | $5,247.8 | | 3 | | $10,110.3 | | None | | None |
Potential Conflicts of Interest
Actual or apparent conflicts of interest may arise when a portfolio manager has day-to-day management responsibilities with respect to more than one Fund or other account. More specifically, portfolio managers who manage multiple Funds and/or other accounts may be presented with one or more of the following potential conflicts:
| | • | | The management of multiple Funds and/or other accounts may result in a portfolio manager devoting unequal time and attention to the management of each Fund and/or other account. The Adviser and each Sub-Adviser seek to manage such competing interests for the time and attention of portfolio managers by having portfolio managers focus on a particular investment discipline. Most other accounts managed by a portfolio manager are managed using the same investment models that are used in connection with the management of the Funds. |
| | • | | If a portfolio manager identifies a limited investment opportunity which may be suitable for more than one Fund or other account, a Fund may not be able to take full advantage of that opportunity due to an allocation of filled purchase or sale orders across all eligible Funds and other accounts. To deal with these situations, the Adviser, each Sub-Adviser and the Funds have adopted procedures for allocating portfolio transactions across multiple accounts. |
| | • | | The Adviser and each Sub-Adviser determine which broker to use to execute each order for securities transactions for the Funds, consistent with its duty to seek best execution of the transaction. However, for certain other accounts (such as mutual funds for which Invesco or an affiliate acts as sub-adviser, other pooled investment vehicles that are not registered mutual funds, and other accounts managed for organizations and individuals), the Adviser and each Sub-Adviser may be limited by the client with respect to the selection of brokers or may be instructed to direct trades through a particular broker. In these cases, trades for a Fund in a particular security may be placed separately from, rather than aggregated with, such other accounts. Having separate transactions with respect to a security may temporarily affect the market price of the security or the execution of the transaction, or both, to the possible detriment of the Fund or other account(s) involved. |
| | • | | Finally, the appearance of a conflict of interest may arise where the Adviser or Sub-Adviser has an incentive, such as a performance-based management fee, which relates to the management of one Fund or account but not all Funds and accounts for which a portfolio manager has day-to-day management responsibilities. None of the Invesco Fund accounts managed has a performance fee. |
The Adviser, each Sub-Adviser, and the Funds have adopted certain compliance procedures which are designed to address these types of conflicts. However, there is no guarantee that such procedures will detect each and every situation in which a conflict arises.
Description of Compensation Structure
For the Adviser and each affiliated Sub-Adviser
The Adviser and each Sub-Adviser seek to maintain a compensation program that is competitively positioned to attract and retain high-caliber investment professionals. Portfolio managers receive a base salary, an incentive cash bonus opportunity and a deferred compensation opportunity. Portfolio manager compensation is reviewed and may be modified each year as appropriate to reflect changes in the market, as well as to adjust the factors used to determine bonuses to promote competitive Fund performance. The Adviser and each Sub-Adviser evaluate competitive market compensation by reviewing compensation survey results conducted by an independent third party of investment industry compensation. Each portfolio manager’s compensation consists of the following three elements:
Base Salary. Each portfolio manager is paid a base salary. In setting the base salary, the Adviser and each Sub-Adviser’s intention is to be competitive in light of the particular portfolio manager’s experience and responsibilities.
Annual Bonus. The portfolio managers are eligible, along with other employees of the Adviser and each Sub-Adviser, to participate in a discretionary year-end bonus pool. The Compensation Committee of Invesco Ltd. reviews and approves the firm-wide bonus pool based upon progress against strategic objectives and annual operating plan, including investment performance and financial results. In addition, while having no direct impact on individual bonuses, assets under management are considered when determining the starting bonus funding levels. Each portfolio manager is eligible to receive an annual cash bonus which is based on quantitative (i.e. investment performance) and non-quantitative factors (which may include, but are not limited to, individual performance, risk management and teamwork).
Each portfolio manager’s compensation is linked to the pre-tax investment performance of the Funds/accounts managed by the portfolio manager as described in Table 1 below.
Table 1
| | |
Sub-Adviser | | Performance time period1 |
Invesco 2 Invesco Deutschland Invesco Hong Kong2 Invesco Asset Management Invesco Asset Management (India) Private Limited (Invesco India) | | One-, Three- and Five-year performance against Fund peer group |
| |
Invesco- U.S. Real Estate Division2,3 Invesco Senior Secured2,4 Invesco PowerShares2,5 | | Not applicable |
| |
| Invesco Canada2 | | One-year performance against Fund peer group Three- and Five-year performance against entire universe of Canadian funds |
| |
| Invesco Japan6 | | One-, Three- and Five-year performance |
| 1 | Rolling time periods based on calendar year-end. |
| 2 | Portfolio Managers may be granted an annual deferral award that vests on a pro-rata basis over a four year period. |
| 3 | Portfolio Managers for Invesco Global Infrastructure Fund, Invesco Global Real Estate Fund, Invesco MLP Fund, Invesco Real Estate Fund, Invesco Global Real Estate Income Fund and Invesco V.I. Global Real Estate Fund base their bonus on net operating profits of the U.S. Real Estate Division of Invesco. |
| 4 | Invesco Senior Secured’s bonus is based on annual measures of equity return and standard tests of collateralization performance. |
| 5 | Portfolio Managers for Invesco PowerShares base their bonus on Invesco results as well as overall performance of Invesco PowerShares. |
| 6 | Portfolio Managers for Invesco Pacific Growth Fund’s compensation is based on the one-, three- and five-year performance against the appropriate Micropol benchmark. |
High investment performance (against applicable peer group and/or benchmarks) would deliver compensation generally associated with top pay in the industry (determined by reference to the third-party provided compensation survey information) and poor investment performance (versus applicable peer group) would result in low bonus compared to the applicable peer group or no bonus at all. These decisions are reviewed and approved collectively by senior leadership which has responsibility for executing the compensation approach across the organization.
With respect to Invesco PowerShares, there is no policy regarding, or agreement with, the Portfolio Managers or any other senior executive of the Adviser to receive bonuses or any other compensation in connection with the performance of any of the accounts managed by the Portfolio Managers.
Deferred/Long Term Compensation. Portfolio managers may be granted a deferred compensation award based on a firm-wide bonus pool approved by the Compensation Committee of Invesco Ltd. Deferred compensation awards may take the form of annual deferral awards or long-term equity awards. Annual deferral awards may be granted as an annual stock deferral award or an annual fund deferral award. Annual stock deferral awards are settled in Invesco Ltd. common shares. Annual fund deferral awards are notionally invested in certain Invesco Funds selected by the Portfolio Manager and are settled in cash. Long-term equity awards are settled in Invesco Ltd. common shares. Both annual deferral awards and long-term equity awards have a four-year ratable vesting schedule. The vesting period aligns the interests of the Portfolio Managers with the long-term interests of clients and shareholders and encourages retention.
Retirement and health and welfare arrangements. Portfolio managers are eligible to participate in retirement and health and welfare plans and programs that are available generally to all employees.
| ITEM 9. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. |
Not applicable.
| ITEM 10. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
None
| ITEM 11. | CONTROLS AND PROCEDURES. |
| (a) | As of February 14, 2018, an evaluation was performed under the supervision and with the participation of the officers of the Registrant, including the PEO and PFO, to assess the effectiveness of the Registrant’s disclosure controls and procedures, as that term is defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”), as amended. Based on that evaluation, the Registrant’s officers, including the PEO and PFO, concluded that, as of February 14, 2018, the Registrant’s disclosure controls and procedures were reasonably designed to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission; and (2) that material information relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely decisions regarding required disclosure. |
| (b) | There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
| ITEM 12. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| | |
| |
13(a) (1) | | Code of Ethics. |
| |
13(a) (2) | | Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. |
| |
13(a) (3) | | Not applicable. |
| |
13(a) (4) | | Not applicable. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: Invesco Senior Loan Fund
| | |
| By: | | /s/ Sheri Morris |
| | Sheri Morris |
| | Principal Executive Officer |
| |
| Date: | | May 7, 2018 |
Pursuant to the requirements of the Securities and Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| | |
By: | | /s/ Sheri Morris |
| | Sheri Morris |
| | Principal Executive Officer |
| |
| Date: | | May 7, 2018 |
| | |
By: | | /s/ Kelli Gallegos |
| | Kelli Gallegos |
| | Principal Financial Officer |
| |
| Date: | | May 7, 2018 |
EXHIBIT INDEX
| | |
| 13(a) (1) | | Code of Ethics. |
| |
| 13(a) (2) | | Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940. |
| |
| 13(a) (3) | | Not applicable. |
| |
| 13(a) (4) | | Not applicable. |
