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 811-5845
Van Kampen Senior Loan Fund
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
1221 Avenue of the Americas, New York, New York 10020
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas, New York, New York 10020
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 7/31
Date of reporting period: 1/31/05
Item 1. Reports to Shareholders.
The Fund's semi-annual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:
Welcome, Shareholder
In this report, you'll learn about how your investment in Van Kampen
Senior Loan Fund performed during the semiannual period. The portfolio
management team will provide an overview of the market conditions and
discuss some of the factors that affected investment performance during
the reporting period. In addition, this report includes the fund's
financial statements and a list of fund investments as of January 31,
2005.
THIS MATERIAL MUST BE PRECEDED OR ACCOMPANIED BY A PROSPECTUS FOR THE
FUND BEING OFFERED. THE PROSPECTUS CONTAINS INFORMATION ABOUT THE FUND,
INCLUDING THE INVESTMENT OBJECTIVES, RISKS, CHARGES AND EXPENSES. PLEASE
READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT THE FUND WILL ACHIEVE ITS INVESTMENT
OBJECTIVE. THE FUND IS SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
THAT THE MARKET VALUES OF SECURITIES OWNED BY THE FUND WILL DECLINE AND
THAT THE VALUE OF THE FUND SHARES MAY THEREFORE BE LESS THAN WHAT YOU
PAID FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS FUND.
AN INVESTMENT IN SENIOR LOANS IS SUBJECT TO CERTAIN RISKS SUCH AS LOAN
DEFAULTS AND ILLIQUIDITY DUE TO INSUFFICIENT COLLATERAL BACKING.
<Table>
<Caption>
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NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE
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NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT
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</Table>
Performance Summary as of 1/31/05
<Table>
<Caption>
B SHARES C SHARES
since 10/4/89 since 6/13/03
- ------------------------------------------------------------------------------------------
W/MAX W/MAX
3.00% 1.00%
AVERAGE ANNUAL W/O SALES SALES W/O SALES SALES
TOTAL RETURNS CHARGES CHARGE CHARGES CHARGE
Since Inception 6.02% 6.02% 10.12% 10.12%
10-year 5.08 5.08 -- --
5-year 3.88 3.71 -- --
1-year 6.38 3.38 6.34 5.34
6-month 2.58 -0.42 2.51 1.51
- ------------------------------------------------------------------------------------------
</Table>
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS AND
PRINCIPAL VALUE WILL FLUCTUATE AND FUND SHARES, WHEN REDEEMED, MAY BE WORTH MORE
OR LESS THAN THEIR ORIGINAL COST.
The returns shown in this report do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund shares.
Performance of share classes will vary due to differences in sales charges and
expenses. Average annual total return assumes reinvestment of all dividends and
capital gains and excludes payment of maximum early withdrawal charge. An early
withdrawal charge for Class B shares of 3.00% will be imposed on most shares
accepted by the fund for repurchase within the first year after purchase and
declining thereafter to 0.00% after the fifth year. An early withdrawal charge
for Class C shares of 1.00% will be imposed on most shares accepted by the fund
for repurchase, which have been held for less than one year. Effective February
18, 2005, the Class B and Class C early withdrawal charge was terminated. (See
Note 12 in the Notes to Financial Statements.)
1
Fund Report
FOR THE SIX-MONTH PERIOD ENDED JANUARY 31, 2005
Van Kampen Senior Loan Fund is managed by the Adviser's Senior Loans team, led
by Howard Tiffen, Managing Director of the Adviser.(1)
MARKET OVERVIEW
The semiannual period ended January 31, 2005 saw a continuation of the favorable
backdrop for the senior-loan market that has prevailed for much of the last two
years. The economy maintained a path of healthy growth, inflation remained
modest, and the long-awaited increase in long-term interest rates failed to
materialize. All of these factors continued to support corporate financial
performance, which has been further aided by the strides in efficiency many
companies made over the past several years in response to an increasingly
competitive environment. The significant decline of the U.S. dollar over the
last two-plus years has provided an additional boost to the competitiveness of
many of the companies that underlie the senior loan market, as a weaker dollar
makes foreign goods more expensive to U.S. consumers and U.S. exports of
manufactured goods more competitive. The end result of strong corporate
profitability has been improving credit quality, which has supported the senior-
loan market's performance.
Yield spreads in the senior-loan market began the semiannual period near
historical lows and remained there throughout the period. These narrow spreads
continued to allow a greater range of companies to access the senior-loan market
at very favorable terms. At the same time, an expanding array of institutional
investors has been attracted to the asset class in view of its improved credit
quality, which has been reflected in significantly lower default rates. In fact,
while senior loans have traditionally been considered somewhat speculative,
there is growing appreciation of the asset class' defensive characteristics. As
a result, demand for and inflows into senior loans remained strong, and
investors readily absorbed the healthy supply of new issues that came to market
during the period. In both the primary and secondary markets, demand has
continued to outstrip supply, which has supported the continued narrowing of
spreads.
(1)Team members may change without notice at any time.
2
PERFORMANCE ANALYSIS
The fund returned 2.58 percent for the six months ended January 31, 2005 (Class
B shares, unadjusted for sales charges).
TOTAL RETURN FOR THE SIX-MONTH PERIOD ENDED JANUARY 31, 2005
<Table>
<Caption>
- -----------------------------------------------
CLASS B CLASS C
2.58% 2.51%
- -----------------------------------------------
</Table>
We believe that the fund's performance over the period reflects the resources we
have dedicated to performing fundamental research and analysis on the companies
held in the portfolio. We continue to focus on identifying those companies that
exhibit strong management, solid and predictable cash flows, and collateral that
is sufficient to provide a healthy backstop in the event of default.
In addition to a strong focus on fundamental company analysis, we continued to
maintain a high level of diversification in the fund's portfolio during the
period in order to minimize the risk of over-concentration in any one sector or
security. We follow a bottom-up security-selection process and generally do not
practice sector rotation. However, we will move to limit the portfolio's
exposure to certain industries facing ongoing challenges. For example, we
continued to minimize the fund's exposure to the auto industry during the
period. We believe that as that industry continues the process of sorting out
the winners from the losers, the risks to auto manufacturers and their suppliers
dictate a cautious approach. We have followed a similar path in
telecommunications, which is experiencing ongoing problems with overcapacity. In
addition, within the healthcare sector, we have avoided exposure to companies
which rely on Medicare reimbursement rates for revenues. Federal budget
constraints put at risk the maintenance of existing reimbursement rates.
Looking ahead, while growth in corporate profits is showing signs of slowing, we
believe profitability and pricing power for the borrowers that underlie the
senior loan market may remain strong. As a result, we expect that these
companies will potentially be able to continue to generate free cash-flow and
that credit quality will not deteriorate in any meaningful way. For these
reasons, we believe the environment for senior loans may continue to be quite
favorable in the coming months. We will continue to pursue a disciplined
investment approach, that seeks to balance attractive yields with a relatively
stable net asset value for the fund.
There is no guarantee that any securities will continue to perform well or be
held by the fund in the future.
3
<Table>
<Caption>
SUMMARY OF INVESTMENTS BY INDUSTRY CLASSIFICATION AS OF 1/31/05
PERCENT OF
INDUSTRY NET ASSETS
Printing & Publishing 8.2
Entertainment & Leisure 7.7
Hotels, Motels, Inns & Gaming 7.3
Beverage, Food & Tobacco 7.0
Chemicals, Plastics & Rubber 6.9
Broadcasting--Cable 6.2
Healthcare 4.7
Automotive 4.4
Containers, Packaging & Glass 4.3
Buildings & Real Estate 3.2
Electronics 2.8
Telecommunications--Wireless 2.4
Aerospace/Defense 2.3
Ecological 2.3
Utilities 2.1
Medical Products & Services 2.1
Healthcare & Beauty 1.9
Finance 1.8
Construction Material 1.6
Insurance 1.6
Retail--Stores 1.6
Diversified Manufacturing 1.5
Mining, Steel, Iron & Non-Precious Metals 1.4
Retail--Specialty 1.4
Telecommunications--Local Exchange Carriers 1.3
Home & Office Furnishings, Housewares & Durable Consumer
Products 1.2
Personal & Miscellaneous Services 1.1
Retail--Oil & Gas 1.0
Paper & Forest Products 1.0
Business Equipment 0.9
Pharmaceuticals 0.8
Natural Resources 0.8
Transportation--Personal 0.8
Non-Durable Consumer Products 0.7
Transportation--Cargo 0.6
Broadcasting--Radio 0.6
Broadcasting--Diversified 0.5
Restaurants & Food Service 0.4
Farming & Agriculture 0.4
Machinery 0.4
Broadcasting--Television 0.2
Telecommunications--Long Distance 0.2
Transportation--Rail Manufacturing 0.1
-----
Total Long-Term Investments 99.7%
Short-Term Investments 2.3
Borrowings (1.7)
Liabilities in Excess of Other Assets (0.3)
-----
Net assets 100.0%
</Table>
Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Summary of investments by industry
classification percentages are as a percentage of net assets. Securities are
classified by sectors that represent broad groupings of related industries. Van
Kampen is a wholly owned subsidiary of a global securities firm which is engaged
in a wide range of financial services including, for example, securities trading
and brokerage activities, investment banking, research and analysis, financing
and financial advisory services.
4
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen fund provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
fund's second and fourth fiscal quarters by filing the schedule
electronically with the Securities and Exchange Commission (SEC). The
semiannual reports are filed on Form N-CSRS and the annual reports are
filed on Form N-CSR. Van Kampen also delivers the semiannual and annual
reports to fund shareholders, and makes these reports available on its
public web site, www.vankampen.com. In addition to the semiannual and
annual reports that Van Kampen delivers to shareholders and makes
available through the Van Kampen public web site, each fund files a
complete schedule of portfolio holdings with the SEC for the fund's first
and third fiscal quarters on Form N-Q. Van Kampen does not deliver the
reports for the first and third fiscal quarters to shareholders, nor are
the reports posted to the Van Kampen public web site. You may, however,
obtain the Form N-Q filings (as well as the Form N-CSR and N-CSRS
filings) by accessing the SEC's web site, http://www.sec.gov. You may
also review and copy them at the SEC's Public Reference Room in
Washington, DC. Information on the operation of the SEC's Public
Reference Room may be obtained by calling the SEC at 1-202-942-8090. You
can also request copies of these materials, upon payment of a duplicating
fee, by electronic request at the SEC's e-mail address
(publicinfo@sec.gov) or by writing the Public Reference section of the
SEC, Washington, DC 20549-0102.
In addition to filing a complete schedule of portfolio holdings with the
SEC each fiscal quarter, each Van Kampen fund makes portfolio holdings
information available by periodically providing the information on its
public web site, www.vankampen.com. Each Van Kampen fund provides a
complete schedule of portfolio holdings on the public web site on a
calendar-quarter basis approximately 30 days after the close of the
calendar quarter. Furthermore, each Van Kampen fund provides partial
lists of its portfolio holdings (such as top 10 or top 15 fund holdings)
to the public web site each with a delay of approximately 15 days.
You may obtain copies of a fund's fiscal quarter filings, or its monthly
or calendar-quarter web site postings, by contacting Van Kampen Client
Relations at 1-800-847-2424.
5
ANNUAL HOUSEHOLDING NOTICE
To reduce fund expenses, the fund attempts to eliminate duplicate
mailings to the same address. The fund delivers a single copy of certain
shareholder documents to investors who share an address, even if the
accounts are registered under different names. The fund's prospectuses
and shareholder reports (including annual privacy notices) will be
delivered to you in this manner indefinitely unless you instruct us
otherwise. You can request multiple copies of these documents by either
calling 800-341-2911 or writing to Van Kampen Investor Services at 1
Parkview Plaza, P.O. Box 5555, Oakbrook Terrace, IL 60181. Once Investor
Services has received your instructions, we will begin sending individual
copies for each account within 30 days.
PROXY VOTING POLICIES AND PROCEDURES
A description of the fund's policies and procedures with respect to the
voting of proxies relating to the fund's portfolio securities is
available without charge, upon request, by calling 1-800-847-2424. This
information is also available on the Securities and Exchange Commission's
website at http://www.sec.gov
6
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED)
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
VARIABLE RATE** SENIOR LOAN INTERESTS 93.5%
AEROSPACE/DEFENSE 2.3%
$ 3,591 Alion Science and
Technology Corp., Term 4.92 to
Loan...................... B1 B+ 7.00% 08/02/2009 $ 3,617,932
3,000 AM General, LLC, Term Loan 6.99 to
(a)....................... NR NR 8.75 11/01/2011 3,086,250
2,600 Apptis, Inc., Term Loan... B2 B+ 5.73 01/05/2010 2,629,250
4.56 to
2,481 ARINC, Inc., Term Loan.... Ba3 BB 4.78 03/10/2011 2,518,469
2,793 Ceradyne, Inc., Term 3.94 to
Loan...................... Ba3 BB- 4.50 08/18/2011 2,833,149
3,000 ILC Industries, Inc., Term
Loan...................... NR NR 5.40 08/05/2010 3,045,796
5,850 K & F Industries, Inc., 4.95 to
Term Loan................. B2 B+ 6.75 11/16/2012 5,951,158
19,195 The Titan Corp., Term 5.37 to
Loan...................... Ba3 BB- 5.46 06/30/2009 19,470,535
2,211 The Titan Corp., Revolving 5.24 to
Credit Agreement.......... Ba3 BB- 6.75 05/23/2008 2,198,405
1,485 Transdigm, Inc., Term
Loan...................... B1 B+ 4.67 07/22/2010 1,506,840
--------------
46,857,784
--------------
AUTOMOTIVE 4.3%
2,400 Affinia Group, Inc., Term
Loan (a).................. B2 BB- 5.44 11/30/2011 2,440,800
19,235 Federal-Mogul Corp., Term
Loan (b).................. NR NR 6.09 12/09/2005 19,354,764
8,807 Federal-Mogul Corp.,
Revolving Credit Agreement
(b)....................... NR NR 6.09 12/09/2005 8,828,907
11,329 Goodyear Tire & Rubber
Co., Term Loan............ B1 BB 6.56 03/31/2006 11,537,625
9,605 MetoKote Corp., Term 5.73 to
Loan...................... B1 B+ 5.98 08/13/2010 9,772,711
4,577 Polypore, Inc., Term
Loan...................... B1 B 4.83 11/12/2011 4,645,655
17,889 Safelite Glass Corp., Term 7.06 to
Loan (c).................. NR NR 7.56 09/30/2007 15,339,924
4,011 Tenneco Automotive, Inc.,
Term Loan................. B1 B+ 5.35 12/12/2010 4,089,590
7,090 ThermaSys Corp., Term Loan
(d)....................... NR NR 5.00 08/25/2007 1,595,302
</Table>
See Notes to Financial Statements 7
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
AUTOMOTIVE (CONTINUED)
$ 9,100 TRW Automotive, Inc., Term 3.88 to 10/29/10 to
Loan...................... Ba2 BB+ 4.38% 06/30/12 $ 9,135,940
1,933 United Components, Inc.,
Term Loan................. B1 BB- 4.78 06/30/2010 1,961,730
--------------
88,702,948
--------------
BEVERAGE, FOOD & TOBACCO 6.9%
5,985 Acosta Sales Co., Inc., 4.82 to
Term Loan (a)............. NR NR 5.46 08/10/2010 6,080,389
1,927 Atkins Nutritionals, Inc., 7.89 to
Term Loan................. NR NR 8.19 10/29/2009 1,744,352
9,370 Birds Eye Foods, Inc.,
Term Loan (a)............. B1 B+ 5.31 06/30/2008 9,500,955
3,388 Commonwealth Brands, Inc.,
Term Loan................. NR NR 5.88 08/28/2007 3,434,440
18,000 Constellation Brands, 4.25 to
Inc., Term Loan........... Ba2 BB 4.75 11/30/2011 18,247,500
500 Culligan International
Co., Term Loan............ B1 B+ 4.92 09/30/2011 507,604
2,686 Del Monte Corp., Term
Loan...................... Ba3 BB- 4.96 12/20/2010 2,702,598
5,985 Doane Pet Care Co., Term 6.37 to
Loan...................... B2 B+ 6.56 11/05/2009 6,089,738
9,254 Dole Food Co., Inc., Term 4.44 to 09/28/08 to
Loan...................... B3 BB 8.00 07/21/10 9,456,428
11,104 DS Waters Enterprises, LP, 6.37 to
Term Loan................. B3 B- 6.67 11/07/2009 10,420,881
7,873 Land O' Lakes, Inc., Term
Loan...................... B1 B+ 5.71 10/10/2008 7,997,893
6,315 Luigino's, Inc., Term 5.44 to
Loan...................... B1 B+ 5.63 04/02/2011 6,346,609
5,516 Michael Foods, Inc., Term 4.63 to
Loan...................... B1 B+ 6.50 11/21/2010 5,612,284
1,330 OSI Foods GMBH & Co. KG,
Term Loan................. NR NR 4.81 09/02/2011 1,349,673
4,655 OSI Group, LLC, Term
Loan...................... NR NR 4.81 09/02/2011 4,723,857
5,824 Pierre Foods, Inc., Term
Loan...................... B1 B+ 4.48 06/30/2010 5,889,520
27,560 Pinnacle Foods, Inc., Term 5.81 to
Loan...................... B1 B+ 6.37 11/25/2010 27,611,662
</Table>
8 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
BEVERAGE, FOOD & TOBACCO (CONTINUED)
$ 3,715 Southern Wine & Spirits of
America, Inc., Term
Loan...................... NR NR 4.81% 07/02/2008 $ 3,769,810
3,550 Sunny Delight Beverage 6.59 to
Co., Term Loan............ B1 BB- 10.04 08/20/2010 3,385,125
4.90 to
5,712 Swift & Co., Term Loan.... Ba2 BB 5.05 09/19/2008 5,812,142
--------------
140,683,460
--------------
BROADCASTING--CABLE 6.2%
2,233 Cebridge Connections, 5.24 to
Inc., Term Loan........... NR NR 7.50 02/23/2009 2,241,499
2,200 Century Cable Holdings,
LLC, Term Loan (b)........ NR NR 7.25 06/30/2009 2,187,625
56,768 Charter Communications
Operating, LLC, Term 5.73 to 04/27/10 to
Loan...................... B2 B 5.98 04/27/11 56,612,176
10,904 Frontiervision Operating
Partners, LP, Term Loan 6.65 to 09/30/05 to
(b)....................... NR NR 6.78 03/31/06 10,953,616
927 Frontiervision Operating
Partners, LP, Revolving
Credit Agreement (b)...... NR NR 6.65 10/31/2005 930,788
4,661 Hilton Head
Communications, LP, Term
Loan (b).................. NR NR 6.50 03/31/2008 4,600,652
5,700 Hilton Head
Communications, LP,
Revolving Credit Agreement
(b)....................... NR NR 5.25 09/30/2007 5,611,650
7,920 Insight Midwest Holdings,
LLC, Term Loan............ Ba3 BB 5.44 12/31/2009 8,053,650
4.89 to
4,428 MCC Iowa, LLC, Term Loan.. Ba3 BB+ 5.29 09/30/2010 4,487,804
25,955 Olympus Cable Holdings, 6.50 to 06/30/10 to
LLC, Term Loan (b)........ NR NR 7.25 09/30/10 25,766,539
4,680 Parnassos, LP, Term Loan
(b)....................... NR NR 5.25 06/30/2007 4,673,926
1,320 Parnassos, LP, Revolving
Credit Agreement (b)...... NR NR 5.25 06/30/2007 1,317,254
--------------
127,437,179
--------------
</Table>
See Notes to Financial Statements 9
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
BROADCASTING--DIVERSIFIED 0.5%
$ 5,781 DirecTV Holdings, LLC, 4.45 to
Term Loan................. Ba1 BB 4.48% 03/06/2010 $ 5,868,873
2,600 Entravision Communications
Corp., Term Loan.......... B1 B+ 4.31 02/24/2012 2,620,584
1,191 PanAmSat Holding Corp.,
Term Loan................. B1 BB+ 5.25 08/20/2011 1,201,556
--------------
9,691,013
--------------
BROADCASTING--RADIO 0.6%
12,004 Spanish Broadcasting
Systems, Inc., Term
Loan...................... B1 B+ 5.73 10/30/2009 12,183,806
--------------
BROADCASTING--TELEVISION 0.2%
3,588 NEP Supershooters, LP,
Term Loan................. B1 B 6.56 02/03/2011 3,646,305
--------------
BUILDINGS & REAL ESTATE 3.2%
2,800 AIMCO Properties, LP, Term
Loan (a).................. NR NR 4.18 11/02/2009 2,854,250
6,329 CB Richard Ellis Services, 3.92 to
Inc., Term Loan (a)....... B1 B+ 6.25 03/31/2010 6,392,047
2,487 Central Parking Corp.,
Term Loan................. Ba3 BB- 5.06 03/31/2010 2,532,140
5,598 Corrections Corp. of 4.53 to
America, Term Loan........ Ba3 BB- 4.95 03/31/2008 5,692,402
4,606 Crescent Real Estate
Equities Co., Term Loan... NR NR 4.64 01/12/2006 4,650,562
29,965 General Growth, LLC, Term 11/12/07 to
Loan...................... Ba2 BB+ 4.64 11/12/08 30,163,438
1,521 GEO Group, Inc., Term 4.63 to
Loan...................... Ba3 BB- 5.00 07/09/2009 1,547,603
6,000 Landsource Communities
Development, LLC, Term
Loan...................... NR NR 5.06 03/31/2010 6,095,628
4,500 South Edge, LLC, Term 4.44 to 10/31/07 to
Loan...................... NR NR 4.69 10/31/09 4,531,721
--------------
64,459,791
--------------
BUSINESS EQUIPMENT 0.9%
6,795 General Binding Corp., 6.76 to
Term Loan................. B2 B+ 7.39 01/15/2008 6,820,147
6.81 to
4,875 Katun Corp., Term Loan.... NR B+ 8.25 06/30/2009 4,887,187
6,181 Verifone, Inc., Term 5.23 to 06/30/11 to
Loan...................... B1 B+ 8.73 12/31/11 6,314,215
--------------
18,021,549
--------------
</Table>
10 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
CHEMICALS, PLASTICS & RUBBER 6.7%
$ 1,198 Becker-Underwood, Inc., 6.45 to 09/30/11 to
Term Loan................. NR NR 9.20% 03/31/12 $ 1,198,200
6,500 Brenntag AG, Term Loan
(Germany) (a)............. B1 BB- 4.73 02/27/2012 6,564,350
4,389 Celanese AG, Term Loan
(Germany) (a)............. B1 B+ 4.81 04/06/2011 4,405,459
3,479 Hercules, Inc., Term 3.97 to
Loan...................... Ba1 BB 4.31 10/08/2010 3,519,492
28,932 Huntsman Corp., Term
Loan...................... B2 B 6.05 03/31/2010 29,445,543
21,532 Huntsman ICI Chemicals,
LLC, Term Loan............ B1 B 5.00 12/31/2010 21,871,199
600 IMC Global, Inc.,
Revolving Credit 6.25 to
Agreement................. Ba3 BB+ 7.50 05/17/2006 591,000
2,700 Jet Plastica Industries,
Inc., Term Loan........... NR NR 7.00 02/28/2005 2,699,545
768 Jet Plastica Industries,
Inc., Revolving Credit
Agreement................. NR NR 7.00 02/28/2005 767,550
14,940 KOSA B.V., Term Loan
(Netherlands)............. Ba3 BB 5.31 04/29/2011 15,211,416
5,860 Kraton Polymers, LLC, Term 4.88 to
Loan...................... B1 B+ 5.56 12/23/2010 5,913,374
4.52 to 11/04/09 to
16,286 Nalco Co., Term Loan...... B1 BB- 5.42 11/04/10 16,528,396
5.61 to
3,942 Rhodia, Inc., Term Loan... B2 NR 7.06 06/18/2006 3,918,336
15,200 Rockwood Specialties
Group, Inc., Term Loan.... B1 B+ 4.95 07/30/2012 15,388,647
8,381 Unifrax Corp., Term
Loan...................... B1 B+ 6.13 05/19/2010 8,538,417
--------------
136,560,924
--------------
CONSTRUCTION MATERIAL 1.6%
10,421 Builders FirstSource,
Inc., Term Loan (a)....... NR B+ 5.58 02/25/2010 10,460,330
1,970 Building Materials Holding
Corp., Term Loan (a)...... Ba2 BB- 5.31 08/21/2010 1,984,775
3,974 Compression Polymers
Corp., Term Loan.......... B1 B 5.04 03/12/2010 4,016,154
2,800 Contech Construction
Products, Inc., Term
Loan...................... Ba3 BB- 4.94 12/07/2010 2,847,250
3,750 Interline Brands, Inc.,
Term Loan................. B1 BB- 4.81 12/31/2010 3,796,875
4.75 to
811 Itron, Inc., Term Loan.... Ba3 BB- 6.50 06/28/2011 820,004
</Table>
See Notes to Financial Statements 11
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
CONSTRUCTION MATERIAL (CONTINUED)
$ 1,759 Juno Lighting, Inc., Term 4.89 to
Loan...................... B1 B+ 6.75% 11/21/2010 $ 1,789,413
1,580 Professional Paint, Inc., 5.50 to
Term Loan................. NR NR 6.06 09/30/2011 1,601,725
6,479 Werner Holding Co., Inc., 5.94 to
Term Loan................. B1 CCC+ 6.34 06/11/2009 6,300,755
--------------
33,617,281
--------------
CONTAINERS, PACKAGING & GLASS 4.3%
2,083 BWAY Corp., Term Loan
(a)....................... B1 B+ 4.75 06/30/2011 2,118,787
1,194 Consolidated Container
Company, LLC, Term Loan... B2 B- 5.13 12/15/2008 1,209,671
17,432 Dr. Pepper/Seven Up
Bottling Group, Inc., Term 4.47 to
Loan...................... B1 NR 4.75 12/19/2010 17,727,856
871 Fleming Packaging Corp.,
Term Loan (b) (d) (f)..... NR NR 5.50 08/31/2004 8,711
100 Fleming Packaging Corp.,
Revolving Credit Agreement
(b) (d) (f)............... NR NR 2.50 03/31/2003 1,000
4,800 Graham Packaging Co., Term 5.00 to
Loan...................... B2 B 5.13 10/07/2011 4,871,573
12,742 Graphic Packaging
International Corp., Term 5.06 to
Loan...................... B1 B+ 5.44 06/30/2010 12,972,675
652 Graphic Packaging
International Corp.,
Revolving Credit 5.68 to
Agreement................. B1 B+ 5.92 08/08/2009 633,826
4,276 Impress Metal Packaging
Holding B.V., Term Loan
(Netherlands)............. NR B+ 6.03 12/31/2006 4,297,283
2,189 Kranson Industries, Inc.,
Term Loan................. NR NR 5.31 07/30/2011 2,221,835
12,396 Owens-Illinois, Inc., Term 4.95 to 04/01/07 to
Loan...................... B1 BB- 5.33 04/01/08 12,625,570
7,284 Packaging Dynamics, Term 09/29/08 to
Loan...................... NR NR 5.56 09/29/09 7,300,367
10,434 Smurfit-Stone Container 4.44 to
Corp., Term Loan.......... Ba3 BB- 4.69 11/01/2011 10,599,995
1,325 Smurfit-Stone Container
Corp., Revolving Credit 4.75 to
Agreement................. Ba3 BB- 6.50 11/01/2009 1,292,200
</Table>
12 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
CONTAINERS, PACKAGING & GLASS (CONTINUED)
$ 1,978 Solo Cup, Inc., Term 4.62 to
Loan...................... B1 B+ 5.06% 02/27/2011 $ 2,015,235
438 Tekni-Plex, Inc.,
Revolving Credit 6.40 to
Agreement................. B3 B- 8.25 06/21/2006 433,453
6,962 U.S. Can Corp., Term
Loan...................... B2 B 6.40 01/10/2010 6,949,408
--------------
87,279,445
--------------
DIVERSIFIED MANUFACTURING 0.7%
5,353 Chart Industries, Inc, 5.63 to
Term Loan (c)............. NR NR 5.68 09/15/2009 5,386,619
9,450 Mueller Group, Inc., Term 5.15 to
Loan...................... B2 B+ 6.75 04/23/2011 9,561,755
--------------
14,948,374
--------------
ECOLOGICAL 2.3%
22,554 Allied Waste North
America, Inc., Term Loan 4.90 to
(a)....................... B1 BB 5.27 01/15/2010 22,908,777
77 Allied Waste North
America, Inc., Revolving
Credit Agreement.......... B1 BB 5.22 01/15/2010 75,989
980 Casella Waste Systems, 4.69 to
Inc., Term Loan (a)....... B1 BB- 5.31 05/11/2007 992,557
6,467 Duratek, Inc., Term 5.94 to
Loan...................... B1 BB- 6.13 12/16/2009 6,477,500
2,288 Environmental Systems
Products Holdings, Term 5.63 to 12/12/08 to
Loan...................... B2 NR 12.56 12/12/10 2,335,364
5,708 Great Lakes Dredge & Dock 5.49 to
Corp., Term Loan.......... B2 B- 6.60 12/22/2010 5,707,960
1,847 Safety-Kleen Corp., Term
Loan (g).................. NR NR 12.00 12/24/2008 831,130
2,382 Waste Services, Inc., Term 6.70 to
Loan...................... Caa1 B- 7.50 03/31/2011 2,389,444
467 Waste Services, Inc.,
Revolving Credit 6.98 to
Agreement................. Caa1 B- 7.11 04/29/2009 455,000
4,000 Wastequip, Inc., Term 6.25 to
Loan...................... NR NR 6.50 12/31/2010 4,010,000
--------------
46,183,721
--------------
ELECTRONICS 2.8%
10,059 Audio Visual Services
Corp., Term Loan.......... NR NR 6.50 03/04/2006 10,612,630
1,600 Fairchild Semiconductor
Corp., Term Loan.......... Ba3 BB- 4.25 12/31/2010 1,618,000
8,052 Knowles Electronics, Inc.,
Term Loan................. B3 NR 7.19 06/29/2007 8,115,287
</Table>
See Notes to Financial Statements 13
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
ELECTRONICS (CONTINUED)
$ 3,080 Memec Group Ltd., Term 5.06 to 04/30/09 to
Loan (England)............ B2 B 10.50% 06/15/10 $ 3,093,220
9,786 Rayovac Corp., Term 4.78 to
Loan...................... B1 B+ 6.75 09/30/2009 9,897,966
14,800 Semiconductor Components
Industries, LLC, Term
Loan...................... B3 B 5.56 12/15/2011 14,892,500
4,876 UGS Corp., Term Loan...... B1 B+ 4.83 05/27/2011 4,951,680
3,600 Viasystems, Inc., Term 6.49 to
Loan...................... B2 NR 6.69 09/30/2009 3,636,749
--------------
56,818,032
--------------
ENTERTAINMENT & LEISURE 5.5%
2,000 Alliance Atlantis
Communications, Inc., Term
Loan (a).................. Ba2 BB 4.29 12/20/2011 2,025,000
3,524 Detroit Red Wings, Inc.,
Term Loan................. NR NR 5.39 08/30/2006 3,546,158
2,046 Festival Fun Parks, LLC, 7.25 to 06/30/07 to
Term Loan................. NR NR 7.75 12/31/07 2,037,203
29,016 Metro-Goldwyn-Mayer, Inc.,
Term Loan................. NR NR 5.06 04/30/2011 29,092,334
3,758 Mets II, LLC, Term Loan... NR NR 5.77 08/23/2005 3,814,708
2,800 New Jersey Basketball,
LLC, Term Loan............ NR NR 6.06 08/16/2008 2,800,000
4,714 Pure Fishing, Inc., Term 5.55 to
Loan...................... B1 BB- 5.85 09/30/2010 4,796,877
17,388 Regal Cinemas, Inc., Term
Loan...................... Ba3 BB- 4.56 11/10/2010 17,612,152
8,420 Six Flags Theme Parks,
Inc., Term Loan........... B1 B- 4.90 06/30/2009 8,567,698
200 Six Flags Theme Parks,
Inc., Revolving Credit 4.95 to
Agreement................. B1 B- 5.08 06/30/2008 195,000
3,877 Tigers Ballpark, LLC, Term 4.88 to
Loan...................... NR NR 5.19 12/01/2006 3,884,426
8,390 True Temper, Inc., Term 5.22 to
Loan...................... B2 B 7.25 03/15/2011 8,358,254
4,000 Universal City Development 4.48 to
Partners LP, Term Loan.... Ba3 NR 4.66 06/09/2011 4,065,000
12,406 Warner Music Group, Term 4.97 to
Loan...................... B1 B+ 5.38 02/28/2011 12,575,546
</Table>
14 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
ENTERTAINMENT & LEISURE (CONTINUED)
$ 4,548 Worldwide Sports &
Recreation, Inc., Term 5.66 to
Loan...................... NR NR 6.06% 12/31/2006 $ 4,559,008
3,920 YankeesNets, LLC, Term 4.85 to
Loan...................... NR NR 5.03 06/25/2007 3,988,600
880 Yankess Holdings, LP, Term 4.49 to
Loan...................... NR NR 4.90 06/25/2007 895,400
--------------
112,813,364
--------------
FARMING & AGRICULTURE 0.4%
7,651 United Industries Corp., 6.75 to 04/29/11 to
Term Loan................. B1 B+ 8.75 10/31/11 7,670,430
--------------
FINANCE 1.4%
3,180 DCS Business Services, 6.40 to 12/31/08 to
Inc., Term Loan........... NR NR 6.90 12/31/09 3,186,712
8,214 Outsourcing Solutions,
Term Loan................. NR NR 7.40 12/09/2008 8,244,539
5,426 Rent-A-Center, Inc., Term
Loan...................... Ba2 BB+ 4.21 06/30/2010 5,500,359
4,774 Risk Management Assurance
Co., Term Loan............ NR NR 6.63 12/21/2006 4,535,176
7,180 Transfirst Holdings, Inc., 6.56 to 03/31/10 to
Term Loan................. NR NR 10.06 03/31/11 7,215,363
--------------
28,682,149
--------------
HEALTHCARE 3.8%
4,457 Ameripath, Inc., Term
Loan...................... B2 B+ 5.83 03/27/2010 4,495,887
3,064 AMN Healthcare Services,
Inc., Term Loan........... Ba2 BB- 5.56 10/02/2008 3,092,677
5,586 Ardent Health Services,
Term Loan (a)............. B1 B+ 4.80 08/12/2011 5,633,135
28,306 Community Health Systems,
Inc., Term Loan........... Ba3 BB- 4.15 08/19/2011 28,562,404
5,086 Concentra Operating Corp., 4.88 to
Term Loan................. B1 B+ 5.10 06/30/2010 5,151,386
5,988 FHC Health Systems, Inc., 8.40 to
Term Loan................. B2 B 10.40 12/18/2009 6,077,675
4,515 Genesis Healthcare Corp.,
Term Loan................. Ba3 BB- 4.67 12/01/2010 4,578,729
8,193 InteliStaf Group, Inc., 5.80 to 10/31/05 to
Term Loan................. NR NR 6.30 10/31/07 8,131,103
2,388 Medcath Holdings Corp., 5.11 to
Term Loan................. B2 B+ 6.50 06/30/2011 2,413,373
3,111 Multiplan, Inc., Term
Loan...................... Ba3 B+ 5.31 03/04/2009 3,146,111
</Table>
See Notes to Financial Statements 15
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
HEALTHCARE (CONTINUED)
$ 3,200 PacifiCare Health Systems, 4.06 to
Inc., Term Loan........... Ba2 BBB- 4.25% 12/13/2010 $ 3,214,666
1,990 Sterigenics International,
Inc., Term Loan........... B2 B+ 5.53 06/14/2011 2,014,875
--------------
76,512,021
--------------
HEALTHCARE & BEAUTY 1.9%
3,947 American Safety Razor Co., 5.64 to
Term Loan................. B2 B 5.98 04/29/2011 3,967,119
7,400 CEI Holdings, Inc., Term 5.24 to 12/03/10 to
Loan...................... NR NR 9.19 12/03/11 7,467,500
3,200 Del Laboratories, Inc.,
Term Loan................. B1 B 6.50 07/27/2011 3,200,000
5,000 Marietta Intermediate
Holding Corp., Term 7.50 to
Loan...................... NR NR 11.50 12/17/2010 5,048,000
17,921 Prestige Brands Holdings, 5.29 to 04/06/11 to
Inc., Term Loan........... B1 B 9.00 10/06/11 18,259,499
--------------
37,942,118
--------------
HOME & OFFICE FURNISHINGS, HOUSEWARES & DURABLE
CONSUMER PRODUCTS 1.2%
6,176 Formica Corp., Term 7.55 to
Loan...................... NR NR 7.74 06/10/2010 6,207,275
2,790 Hunter Fan Co., Term 6.25 to
Loan...................... NR NR 7.75 04/30/2010 2,837,081
5,045 Imperial Home Decor Group,
Inc., Term Loan (c) (d)
(f)....................... NR NR 8.75 04/04/2006 126,121
3,770 National Bedding Co., Term 4.90 to
Loan...................... Ba3 BB- 5.13 12/31/2010 3,825,273
12,170 Sealy Mattress Co., Term 4.45 to
Loan...................... B2 B+ 4.65 04/06/2012 12,352,187
--------------
25,347,937
--------------
HOTELS, MOTELS, INNS & GAMING 7.3%
5,157 Alliance Gaming Corp.,
Term Loan (a)............. Ba3 BB- 4.90 09/04/2009 5,192,030
1,026 Ameristar Casinos, Inc.,
Term Loan................. Ba3 BB- 4.63 12/20/2006 1,041,818
4,975 Boyd Gaming Corp., Term 3.92 to
Loan (a).................. Ba2 BB 4.53 06/30/2011 5,044,963
7,200 CNL Hospitality Partners,
LP, Term Loan............. NR NR 4.90 10/13/2006 7,317,000
2,994 Global Cash Access, LLC,
Term Loan................. B2 B+ 5.17 03/10/2010 3,044,367
3,902 Greektown Casino, LLC, 5.69 to
Term Loan................. NR NR 5.92 12/31/2005 3,940,762
</Table>
16 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
HOTELS, MOTELS, INNS & GAMING (CONTINUED)
$ 3,970 Green Valley Ranch Gaming,
LLC, Term Loan............ B1 NR 4.50% 12/24/2010 $ 4,024,588
3,800 Herbst Gaming, Inc., Term
Loan...................... B1 B+ 4.64 01/31/2011 3,860,564
4,000 Interstate Operating Co.,
LP, Term Loan............. B2 B 8.06 01/14/2008 4,010,000
5,938 Kuilima Resort Co., Term 5.10 to 06/29/07 to
Loan...................... NR NR 5.42 09/29/07 5,922,809
10,129 Mandalay Resort Group,
Term Loan................. NR NR 5.48 06/30/2008 10,154,715
1,600 Marina District Finance
Co., Term Loan............ NR NR 3.93 10/20/2011 1,616,333
1,931 Penn National Gaming, 5.06 to
Inc., Term Loan........... Ba3 BB- 5.08 09/01/2007 1,939,807
41,739 Planet Hollywood
International, Inc., Term
Loan...................... NR B- 5.56 09/01/2010 41,321,125
98 Planet Hollywood
International, Inc., Term
Loan (g).................. NR B- 6.56 09/01/2010 97,418
4,800 Ruffin Gaming, LLC, Term
Loan...................... NR NR 5.94 07/14/2007 4,872,000
4,600 Scientific Games Corp.,
Term Loan................. Ba2 BB 4.26 12/23/2009 4,649,832
2,800 Seminol Tribe of Florida,
Inc., Term Loan........... NR BB 6.50 09/30/2011 2,828,000
3,417 United Auburn Indian
Community, Term Loan...... Ba3 BB+ 6.48 01/24/2009 3,434,074
6,909 Venetian Casino Resorts,
LLC, Term Loan............ B1 B+ 4.90 06/15/2011 7,031,437
25,424 Wyndham International, 7.19 to 04/01/06 to
Inc., Term Loan........... NR NR 8.19 06/30/06 25,570,962
979 Wyndham International,
Inc., Revolving Credit 8.19 to
Agreement................. NR NR 8.38 04/01/2006 976,563
559 Wynn Las Vegas, LLC, Term
Loan...................... B2 B+ 4.69 12/14/2011 566,800
--------------
148,457,967
--------------
INSURANCE 1.6%
5,970 Alliant Resources Group, 5.67 to
Inc., Term Loan........... B2 B 8.75 08/31/2011 5,977,462
1,911 CCC Information Services
Group, Inc., Term Loan.... B1 B+ 5.56 08/20/2010 1,935,016
7,680 Conseco, Inc., Term
Loan...................... B2 BB- 6.08 06/22/2010 7,843,200
</Table>
See Notes to Financial Statements 17
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
INSURANCE (CONTINUED)
$ 4,653 Hilb, Rogal & Hamilton
Co., Term Loan............ Ba3 BB 4.81% 12/15/2011 $ 4,724,353
1,134 Mitchell International,
Inc., Term Loan........... B1 B+ 5.55 08/15/2011 1,152,228
2,695 Universal American
Financial Corp., Term
Loan...................... NR BBB- 4.81 03/31/2009 2,701,738
5,153 USI Holdings Corp., Term
Loan...................... B1 BB- 5.23 08/11/2008 5,180,821
3,600 Vertafore, Inc., Term 5.27 to 12/22/10 to
Loan...................... NR NR 8.52 12/22/11 3,643,000
--------------
33,157,818
--------------
MACHINERY 0.4%
1,600 Douglas Dynamics, LLC,
Term Loan................. B1 BB- 4.51 12/16/2010 1,612,000
3,200 Goodman Global Holdings,
Inc., Term Loan........... B2 B+ 4.81 12/23/2011 3,252,000
2,481 United Rentals (North
America), Inc., Term
Loan...................... Ba3 BB 4.81 02/14/2011 2,519,632
--------------
7,383,632
--------------
MEDICAL PRODUCTS & SERVICES 1.4%
1,552 Advanced Medical Optics, 4.49 to
Inc., Term Loan (a)....... B1 BB- 4.50 06/25/2009 1,568,915
3,600 American Medical
Instruments Holdings, 5.58 to
Inc., Term Loan........... B2 B+ 5.94 12/09/2010 3,631,500
4,600 Center for Diagnostic
Imaging, LLC, Term Loan... B2 NR 5.90 12/31/2010 4,611,500
2,093 Colgate Medical, Ltd., 4.55 to
Term Loan (England)....... Ba2 BB- 4.56 12/30/2008 2,119,347
2,400 Cooper Cos., Inc., Term
Loan...................... Ba3 BB 4.19 01/06/2012 2,434,500
1,446 Dade Behring, Inc., Term
Loan...................... B2 BBB- 4.31 10/03/2008 1,456,559
4.17 to
995 DaVita, Inc., Term Loan... Ba2 BB 4.76 03/31/2009 998,682
4,222 Insight Health, Term
Loan...................... B1 B 6.31 10/17/2008 4,259,959
2,080 Insight Health, Revolving
Credit Agreement.......... B1 B 6.56 10/17/2008 2,086,500
4,557 Kinetics Concepts, Inc.,
Term Loan................. Ba3 BB- 4.31 08/11/2010 4,594,978
463 Rotech Healthcare, Inc.,
Term Loan................. Ba2 BB 5.56 03/31/2008 468,625
--------------
28,231,065
--------------
</Table>
18 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
MINING, STEEL, IRON & NON-PRECIOUS METALS 1.4%
$14,561 Carmeuse Lime, Inc., Term
Loan (a).................. Ba3 NR 5.81% 03/31/2006 $ 14,524,653
8,739 CII Carbon, LLC, Term
Loan...................... NR NR 5.30 06/25/2008 8,630,046
3,800 New Enterprise Stone &
Lime Co., Inc., Term 5.65 to
Loan...................... NR NR 7.25 07/30/2010 3,847,186
2,406 Techs Industries, Inc.,
Term Loan................. NR NR 4.81 01/14/2010 2,412,266
--------------
29,414,151
--------------
NATURAL RESOURCES 0.8%
14,308 El Paso Corp., Term
Loan...................... B3 B- 5.19 11/23/2009 14,472,143
1,966 Foundation PA Coal Co., 4.56 to
Term Loan................. Ba3 BB- 4.78 07/30/2011 1,996,184
--------------
16,468,327
--------------
NON-DURABLE CONSUMER PRODUCTS 0.5%
1,497 Aero Products
International, Inc., Term 5.83 to
Loan...................... NR NR 7.06 12/19/2008 1,477,922
4,975 Amscan Holdings, Inc., 5.29 to
Term Loan (a)............. B1 B+ 7.00 04/30/2012 5,006,094
3,175 Church & Dwight Co., Inc.,
Term Loan................. Ba2 BB 4.31 05/30/2011 3,219,201
1,407 JohnsonDiversey, Inc., 4.43 to
Term Loan................. Ba3 BB- 4.64 11/03/2009 1,432,438
--------------
11,135,655
--------------
PAPER & FOREST PRODUCTS 1.0%
20,000 Boise Cascade, LLC, Term 10/28/10 to
Loan (a).................. Ba3 BB 4.84 10/29/11 20,084,578
--------------
PERSONAL & MISCELLANEOUS SERVICES 1.1%
3,138 Alderwoods Group, Inc., 3.94 to
Term Loan (a)............. B1 BB- 4.54 09/29/2009 3,187,139
2,292 Aspen Marketing Group,
Term Loan (d)............. NR NR 3.50 09/30/2004 309,383
2,299 Coinmach Laundry Corp., 5.44 to
Term Loan................. B2 B 5.63 07/25/2009 2,327,320
1,663 Coinstar, Inc., Term
Loan...................... Ba3 BB- 4.84 07/07/2011 1,691,921
4,055 Educate Operating Co.,
LLC, Term Loan............ B1 B+ 5.06 03/31/2011 4,105,590
2,985 Global Imaging Systems, 4.28 to
Inc., Term Loan........... Ba3 BB- 4.71 05/10/2010 3,022,312
2,100 InfoUSA, Inc., Term
Loan...................... Ba3 BB 5.06 03/25/2009 2,121,000
</Table>
See Notes to Financial Statements 19
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
PERSONAL & MISCELLANEOUS SERVICES (CONTINUED)
$ 3,200 Iron Mountain, Inc., Term
Loan...................... B2 BB- 4.22% 04/02/2011 $ 3,228,666
1,975 Stewart Enterprises, Inc.,
Term Loan................. Ba3 BB+ 4.47 11/19/2011 2,002,883
1,200 United Online, Inc., Term 5.63 to
Loan...................... B1 B+ 6.13 12/13/2008 1,216,500
--------------
23,212,714
--------------
PHARMACEUTICALS 0.8%
3.36 to
7,143 Medco Health, Term Loan... Ba1 BBB 3.72 08/13/2008 7,193,450
9,819 MedPointe, Inc., Term 6.70 to 09/30/07 to
Loan...................... B1 B 7.45 09/30/08 9,864,063
--------------
17,057,513
--------------
PRINTING & PUBLISHING 8.2%
5,476 Adams Outdoor Advertising, 4.92 to 10/15/11 to
LP, Term Loan (a)......... B1 B+ 6.17 04/15/12 5,558,252
593 Advanstar Communications,
Inc., Term Loan (a)....... B2 B 7.08 10/11/2007 597,087
18,200 Advertising Directory
Solutions, Inc., Term Loan 4.48 to 11/09/11 to
(Canada) (a).............. B1 B- 6.23 05/09/12 18,509,503
7,110 American Reprographics
Co., Term Loan (a)........ B1 BB- 5.26 06/18/2009 7,198,875
999 CanWest Media, Inc., Term
Loan (Canada) (a)......... Ba2 B+ 4.70 08/15/2009 1,013,433
9,975 Cygnus Business Media,
Inc., Term Loan........... B3 B 6.42 07/13/2009 9,950,062
2,608 Day International Group, 6.06 to
Inc., Term Loan........... B1 B 6.08 09/16/2009 2,632,713
2,672 Dex Media East, LLC, Term 3.96 to 11/08/08 to
Loan...................... Ba2 BB- 4.62 05/08/09 2,705,196
19,439 Dex Media West, LLC, Term 4.15 to 09/09/09 to
Loan...................... Ba2 BB- 4.91 03/09/10 19,700,763
1,200 Enterprise Newsmedia, LLC,
Term Loan................. NR NR 5.68 06/30/2012 1,220,250
5,217 F&W Publications, Inc.,
Term Loan................. NR NR 5.96 12/31/2009 5,279,381
7,500 Freedom Communications, 4.14 to
Term Loan................. Ba3 BB 4.15 05/18/2012 7,618,125
7,729 Haights Cross
Communications, LLC, Term 5.96 to
Loan...................... B3 B- 6.78 08/20/2008 7,922,676
5,782 Herald Media, Inc., Term 5.03 to 07/22/11 to
Loan...................... NR NR 8.03 01/22/12 5,874,629
</Table>
20 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
PRINTING & PUBLISHING (CONTINUED)
$ 2,920 Journal Register Co., Term 3.42 to
Loan...................... Ba2 BB+ 4.23% 08/12/2012 $ 2,939,164
711 Lamar Media Corp., Term
Loan...................... Ba2 BB- 4.06 06/30/2010 720,000
1,156 Liberty Group Operating, 6.00 to
Inc., Term Loan........... B1 B 6.06 03/31/2007 1,163,035
2,000 MC Communications, LLC, 6.44 to
Term Loan................. NR NR 7.01 12/31/2010 2,015,000
7,755 Merrill Communications, 5.06 to
LLC, Term Loan............ B1 B 7.00 07/30/2009 7,863,831
8,300 Morris Publishing Group,
LLC, Term Loan............ Ba1 BB 4.31 03/31/2011 8,406,348
6,915 Primedia, Inc., Term 4.56 to 06/30/08 to
Loan...................... B3 B 5.38 06/30/09 6,827,736
17,332 R.H. Donnelley, Inc., Term 4.13 to 12/31/09 to
Loan...................... Ba3 B+ 4.56 06/30/11 17,515,398
3,200 Source Media, Inc., Term 4.69 to 11/08/11 to
Loan...................... B1 NR 7.94 08/30/12 3,253,000
9,884 Transwestern Publishing 3.94 to 02/25/11 to
Co., LLC, Term Loan....... B1 B+ 7.08 02/25/12 10,027,563
2,340 Vutek, Inc., Term Loan.... B1 NR 7.75 06/25/2010 2,345,850
8,827 Ziff-Davis Media, Inc.,
Term Loan................. B3 CCC 7.08 03/31/2007 8,749,307
--------------
167,607,177
--------------
RESTAURANTS & FOOD SERVICE 0.5%
1,400 Captain D's, LLC, Term
Loan...................... NR NR 6.33 12/27/2010 1,403,500
2,400 Carrols Holding Corp.,
Term Loan (a)............. B1 B+ 5.06 12/31/2010 2,442,000
3,200 Denny's Corp., Term 5.59 to 09/30/09 to
Loan...................... B3 B 7.89 09/30/10 3,290,501
2,000 Landry's Restaurants, 4.33 to
Inc., Term Loan........... Ba2 BB- 4.53 12/28/2010 2,022,500
--------------
9,158,501
--------------
</Table>
See Notes to Financial Statements 21
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
RETAIL--OIL & GAS 1.0%
$ 1,065 Barjan Products, LLC, Term 8.25 to
Loan...................... NR NR 10.25% 04/30/2007 $ 555,615
711 Barjan Products, LLC,
Revolving Credit
Agreement................. NR NR 7.75 04/30/2007 711,059
4,833 Getty Petroleum Marketing,
Inc., Term Loan........... B1 B+ 5.80 05/19/2010 4,926,979
13,609 The Pantry, Inc., Term
Loan...................... B1 B+ 4.83 03/12/2011 13,838,342
1,200 Travelcenters of America, 4.15 to
Inc., Term Loan........... Ba3 BB 4.38 12/01/2011 1,214,250
--------------
21,246,245
--------------
RETAIL--SPECIALTY 1.3%
3,161 DRL Acquisition, Inc., 6.73 to
Term Loan................. NR NR 8.00 04/30/2009 3,149,762
1,953 Home Interiors & Gifts,
Inc., Term Loan........... B3 B- 7.17 03/31/2011 1,893,555
11,200 Jostens, Inc., Term 4.81 to 10/04/10 to
Loan...................... B1 B+ 5.06 10/04/11 11,327,282
10,027 Nebraska Book Co., Inc.,
Term Loan................. B2 B 4.67 03/04/2011 10,171,384
--------------
26,541,983
--------------
RETAIL--STORES 1.6%
1,800 Advance Stores Co., Inc., 4.13 to
Term Loan (a)............. Ba2 BB+ 4.31 09/30/2010 1,823,979
4,212 CSK Auto, Inc., Term
Loan...................... Ba2 B+ 4.85 06/19/2009 4,259,865
2,400 Dollarama Group, LP, Term
Loan...................... NR NR 4.78 11/18/2011 2,422,500
3,213 Murray's Discount Auto 6.87 to
Stores, Inc., Term Loan... NR NR 8.25 08/08/2009 3,216,638
20,750 Rite Aid Corp., Term 4.17 to
Loan...................... NR B+ 4.31 08/31/2009 20,925,088
--------------
32,648,070
--------------
TELECOMMUNICATIONS--LOCAL EXCHANGE CARRIERS 1.3%
8,174 Cincinnati Bell, Inc., 4.98 to
Term Loan................. B1 B+ 5.08 06/30/2008 8,256,926
2,000 Fairpoint Communications,
Inc., Term Loan........... B1 BB- 6.44 03/31/2007 2,007,500
6,272 Orius Corp., LLC, Term 6.51 to 01/23/09 to
Loan (c).................. NR NR 7.43 01/23/10 1,334,725
4,331 Orius Corp., LLC,
Revolving Credit Agreement
(c)....................... NR NR 5.33 01/23/2006 3,356,451
8,181 Qwest Corp., Term Loan.... Ba3 BB- 7.39 06/30/2007 8,542,518
</Table>
22 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
TELECOMMUNICATIONS--LOCAL EXCHANGE CARRIERS
(CONTINUED)
$ 3,491 Valor Telecommunications, 5.98 to
LLC, Term Loan............ B2 B+ 6.08% 11/10/2011 $ 3,510,525
7,500 WCI Capital Corp., Term
Loan (b) (d).............. NR NR 8.75 09/30/2007 112,500
1,216 WCI Capital Corp.,
Revolving Credit Agreement
(b) (d)................... NR NR 8.25 12/31/2004 50,103
--------------
27,171,248
--------------
TELECOMMUNICATIONS--LONG DISTANCE 0.2%
3,189 Williams Communications, 5.90 to
LLC, Term Loan............ B2 NR 6.06 10/01/2009 3,219,375
--------------
TELECOMMUNICATIONS--WIRELESS 1.8%
1,592 American Tower, LP, Term
Loan (a).................. Ba3 B 4.23 08/31/2011 1,611,900
1,592 Cellular South, Inc., Term 3.88 to
Loan (a).................. NR NR 6.00 05/04/2011 1,614,885
9,429 Centennial Cellular, Inc., 4.92 to
Term Loan................. B2 B- 5.38 02/09/2011 9,513,458
8,110 Nextel Partners, Inc.,
Term Loan................. Ba3 B+ 4.94 05/31/2011 8,229,477
2,400 Spectrasite
Communications, Inc., Term
Loan...................... Ba3 BB- 4.03 05/19/2012 2,420,501
2,928 Syniverse Holding, LLC., 5.40 to
Term Loan................. Ba3 BB 5.56 09/30/2010 2,955,544
9,960 Western Wireless Corp., 5.40 to
Term Loan................. B2 B- 5.71 05/31/2011 10,042,997
--------------
36,388,762
--------------
TRANSPORTATION--CARGO 0.6%
3,442 Havco Wood Products, Inc., 4.67 to
Term Loan................. NR NR 5.28 06/30/2006 2,151,088
670 Kansas City Southern 3.88 to
Railway Co., Term Loan.... Ba3 BB+ 4.28 03/30/2008 679,548
5,315 Pacer International, Inc., 4.06 to
Term Loan................. B1 BB- 5.06 06/10/2010 5,390,907
2,246 Quality Distribution, 5.58 to
Inc., Term Loan........... Caa1 B- 5.64 11/13/2009 2,246,439
900 Quality Distribution,
Inc., Revolving Credit 5.58 to
Agreement................. Caa1 B- 5.64 11/13/2009 875,625
1,385 Transport Industries, LP,
Term Loan................. B2 BB- 6.56 06/13/2010 1,387,110
--------------
12,730,717
--------------
</Table>
See Notes to Financial Statements 23
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
- ----------------------------------------------------------------------------------------------
TRANSPORTATION--PERSONAL 0.8%
$14,792 Laidlaw Investments Ltd.,
Term Loan................. Ba3 BB+ 6.33% 06/19/2009 $ 14,863,649
934 Neoplan USA Corp.,
Revolving Credit Agreement
(c)....................... NR NR 6.56 06/30/2006 933,750
--------------
15,797,399
--------------
TRANSPORTATION--RAIL MANUFACTURING 0.1%
5.56 to
1,995 Helm, Inc., Term Loan..... NR NR 5.62 07/02/2010 2,021,184
--------------
UTILITIES 2.1%
14,086 Allegheny Energy, Inc., 5.01 to
Term Loan (a)............. B1 B+ 5.16 03/08/2011 14,365,511
867 Centerpoint Energy, Inc.,
Revolving Credit 5.39 to
Agreement................. Ba1 BBB- 7.00 10/07/2006 865,583
2,792 Coleto Creek WLE, LP, Term 4.83 to 06/30/11 to
Loan...................... Ba2 BB 6.23 06/30/12 2,847,186
800 NorthWestern Corp., Term
Loan...................... Ba1 BB 4.03 11/01/2011 812,666
4,773 Pike Electric, Inc., Term 4.69 to 07/01/12 to
Loan...................... NR NR 4.75 12/10/12 4,853,985
8,000 Reliant Energy Resources, 4.90 to
Corp., Term Loan.......... B1 B+ 5.07 04/30/2010 8,063,568
11,182 Texas Genco Holdings,
Inc., Term Loan........... Ba2 BB 4.48 12/14/2011 11,335,285
--------------
43,143,784
--------------
TOTAL VARIABLE RATE** SENIOR LOAN INTERESTS 93.5%........................... 1,908,337,496
--------------
</Table>
<Table>
<Caption>
DESCRIPTION
- ----------------------------------------------------------------------------------------------
NOTES 1.0%
Barjan Products, LLC ($1,000,819 par, 5.00% coupon, maturing 04/30/07) (g)... 0
Commonwealth Brands, Inc. ($1,500,000 par, 9.71% coupon, maturing 08/28/07)
(h)........................................................................ 1,563,750
Dade Behring, Inc. ($4,651,067 par, 11.91% coupon, maturing 10/03/10)........ 5,185,940
Pioneer Cos., Inc. ($776,733 par, 6.05% coupon, maturing 12/31/06) (h)....... 819,453
</Table>
24 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
DESCRIPTION VALUE
- ----------------------------------------------------------------------------------------------
NOTES (CONTINUED)
Rogers Wireless Communications, Inc. ($6,000,000 par, 5.53% coupon, maturing
12/15/10) (Canada) (h)..................................................... $ 6,345,000
Satelites Mexicanos, 144A Private Placement ($7,068,000 par, 6.92% coupon,
maturing 06/30/04) (Mexico) (h) (i)........................................ 5,972,460
US Unwired, Inc. ($800,000 par, 6.13% coupon, maturing 06/15/10) (h)......... 830,000
--------------
TOTAL NOTES 1.0%............................................................ 20,716,603
--------------
EQUITIES 5.2%
Aladdin Gaming Holdings, LLC (565,193 common shares) (j)..................... 339,116
Barjan Products, LLC (1,962,870 preferred shares) (Acquisition date 06/21/04,
Cost $2,767,934) (j) (k)................................................... 0
Best Products Co., Inc. (297,480 common shares) (j).......................... 0
Chart Industries, Inc. (325,454 common shares) (Acquisition date 09/25/03,
Cost $6,914,656) (c) (j) (k)............................................... 15,947,246
Dade Behring Holdings, Inc. (157,928 common shares) (j)...................... 9,025,585
DecorateToday.com (198,600 common shares) (Acquisition date 12/31/98, Cost
$3,505,909) (c) (j) (k).................................................... 2,557,968
Environmental Systems Products Holdings, Inc. (2,183 common shares)
(Acquisition date 06/22/04, Cost $0) (j) (k)............................... 22,092
Gentek, Inc. (72,696 common shares).......................................... 3,253,146
Gentek, Inc. (Warrants for 173 common shares) (j)............................ 0
Havco Wood Products, Inc. (30 common shares) (j)............................. 0
Holmes Group, Inc. (Warrants for 950 common shares) (Acquisition date
05/24/04, Cost $0) (j) (k)................................................. 2,660
IDT Corp. (22,898 common shares) (j)......................................... 335,227
Imperial Home Decor Group, Inc. (1,816,143 common shares) (Acquisition date
04/26/01, Cost $1,852,465) (c) (j) (k)..................................... 0
London Clubs International (Warrants for 141,981 common shares) (Acquisition
date 10/15/04, Cost $260,910) (j) (k)...................................... 312,750
London Fog Industries, Inc. (515,922 common shares) (c)...................... 3,405,085
NeighborCare, Inc. (645,769 common shares) (j)............................... 18,940,405
Neoplan USA Corp. (2,262 preferred shares) (Acquisition date 09/04/03, Cost
$1,074,522) (c) (j) (k).................................................... 2,262
Neoplan USA Corp. (8,517 common shares) (Acquisition date 09/04/03, Cost $85)
(c) (j) (k)................................................................ 85
Orius Corp. (1,211,236 common shares) (Acquisition date 02/03/03, Cost $0)
(c) (j) (k)................................................................ 0
Outsourcing Solutions, Inc. (159,176 common shares) (Acquisition date
01/30/04, Cost $8,007,060) (j) (k)......................................... 7,640,448
Planet Hollywood International, Inc. (Warrants for 84,345 common shares)
(Acquisition date 09/03/04, Cost $0) (j) (k)............................... 0
RailWorks Corp. (223 preferred shares) (Acquisition date 02/10/03, Cost
$2,557,518) (j) (k)........................................................ 0
RailWorks Corp. (Warrants for 3,935 common shares) (Acquisition date
02/10/03, Cost $0) (j) (k)................................................. 0
Rotech Medical Corp. (94,289 common shares) (Acquisition date 06/12/02, Cost
$377,156) (j) (k).......................................................... 0
</Table>
See Notes to Financial Statements 25
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
DESCRIPTION VALUE
- ----------------------------------------------------------------------------------------------
EQUITIES (CONTINUED)
xSafelite Glass Corp. (724,479 common shares) (Acquisition date 10/20/00,
Cost $3,912,187) (c) (j) (k)............................................... $ 0
Safelite Realty (48,903 common shares) (Acquisition date 10/20/00, Cost $0)
(c) (j) (k)................................................................ 0
Safety-Kleen Holdings, Inc. (306,849 common shares) (Acquisition date
01/14/04, Cost $1,215,122) (j) (k)......................................... 0
SK Holding Co. (5,227 preferred shares) (Acquisition date 01/14/04, Cost
$126,598) (j) (k).......................................................... 0
Targus Group International (Warrants for 66,824 common shares) (Acquisition
date 01/30/04, Cost $0) (j) (k)............................................ 20,047
Trans World Entertainment Corp. (3,451,962 common shares) (Acquisition date
03/03/98, Cost $63,299,979) (c) (j) (k).................................... 43,322,123
--------------
TOTAL EQUITIES 5.2%......................................................... 105,126,245
--------------
TOTAL LONG TERM INVESTMENTS 99.7%
(Cost $2,095,142,840)...................................................... 2,034,180,344
--------------
SHORT-TERM INVESTMENTS 2.3%
REPURCHASE AGREEMENT 2.0%
State Street Bank & Trust Corp. ($40,500,000 par collateralized by U.S.
Government Obligations in a pooled cash account, interest rate of 2.42%,
dated 01/31/05, to be sold on 02/01/05 at $40,502,723) (a)................. 40,500,000
TIME DEPOSIT 0.3%
State Street Bank & Trust Corp. ($7,387,223 par, 1.75% coupon, dated
01/31/05, to be sold on 02/01/05 at $7,387,582) (a)........................ 7,387,223
--------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $47,887,223)......................................................... 47,887,223
--------------
TOTAL INVESTMENTS 102.0%
(Cost $2,143,030,063)...................................................... 2,082,067,567
BORROWINGS (1.7)%............................................................ (35,000,000)
LIABILITIES IN EXCESS OF OTHER ASSETS (0.3)%................................ (6,444,762)
--------------
NET ASSETS 100.0%........................................................... 2,040,622,805
==============
</Table>
NR -- Not rated
+ Bank Loans rated below Baa by Moody's Investor Service, Inc. or BBB by
Standard & Poor's Group are considered to be below investment grade.
26 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
Industry percentages are calculated as a percentage of net assets.
(a) All or a portion of this security is segregated in connection with unfunded
loan commitments.
(b) This borrower has filed for protection in federal bankruptcy court.
(c) Affiliated company. See Notes to Financial Statements.
(d) This Senior Loan interest is non-income producing.
(e) This borrower is in the process of restructuring or amending the terms of
this loan.
(f) This borrower is currently in liquidation.
(g) Payment-in-kind security.
(h) Variable rate security. Interest rate shown is that in effect at January 31,
2005.
(i) 144A Securities are those which are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally
transactions with qualified institutional buyers.
(j) Non-income producing security as this stock or warrant currently does not
declare dividends.
(k) Restricted security. Securities were acquired through the restructuring of
senior loans. These securities are restricted as they are not allowed to be
deposited via the Depository Trust Company. If at a later point in time, the
company wishes to register, the issuer will bear the costs associated with
registration. The aggregate value of restricted securities represents 3.4%
of the net assets of the Fund.
* Senior Loans in the Fund's portfolio generally are subject to mandatory
and/or optional prepayment. Because of these mandatory prepayment conditions
and because there may be significant economic incentives for a Borrower to
prepay, prepayments of Senior Loans in the Fund's portfolio may occur. As a
result, the actual remaining maturity of Senior Loans held in the Fund's
portfolio may be substantially less than the stated maturities shown.
Although the Fund is unable to accurately estimate the actual remaining
maturity of individual Senior Loans, the Fund estimates that the actual
average maturity of the Senior Loans held in its portfolio will be
approximately 18-24 months.
** Senior Loans in which the Fund invests generally pay interest at rates which
are periodically redetermined by reference to a base lending rate plus a
premium. These base lending rates are generally (i) the lending rate offered
by one or more major European banks, such as the London Inter-Bank Offered
Rate ("LIBOR"), (ii) the prime rate offered by one or more major United
States banks or (iii) the certificate of deposit rate. The interest rates
shown are those in effect at January 31, 2005. Senior Loans are generally
considered to be restricted in that the Fund ordinarily is contractually
obligated to receive approval from the Agent Bank and/or Borrower prior to
the disposition of a Senior Loan.
See Notes to Financial Statements 27
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
January 31, 2005 (Unaudited)
<Table>
ASSETS:
Investments in unaffiliated securities (Cost
$1,987,926,685)........................................... $ 1,990,365,208
Investments in affiliated securities (Cost $155,103,378).... 91,702,359
Cash........................................................ 5,069,383
Receivables:
Fund Shares Sold.......................................... 21,013,492
Interest and Fees......................................... 8,865,130
Investments Sold.......................................... 1,552,766
Other....................................................... 23,007
---------------
Total Assets............................................ 2,118,591,345
---------------
LIABILITIES:
Payables:
Investments Purchased..................................... 36,910,769
Borrowings................................................ 35,000,000
Investment Advisory Fee................................... 1,502,555
Income Distributions...................................... 1,261,620
Distributor and Other Affiliates.......................... 554,968
Administrative Fee........................................ 439,234
Fund Shares Repurchased................................... 2,993
Accrued Expenses............................................ 1,146,680
Trustees' Deferred Compensation and Retirement Plans........ 1,120,580
Accrued Interest Expense.................................... 29,141
---------------
Total Liabilities....................................... 77,968,540
---------------
NET ASSETS.................................................. $ 2,040,622,805
===============
NET ASSETS CONSIST OF:
Capital..................................................... $ 3,205,242,675
Accumulated Undistributed Net Investment Income............. 779,047
Net Unrealized Depreciation................................. (60,962,496)
Accumulated Net Realized Loss............................... (1,104,436,421)
---------------
NET ASSETS.................................................. $ 2,040,622,805
===============
NET ASSET VALUE PER COMMON SHARE:
Class B Shares:
Net asset value and offering price per share (Based on
net assets of $1,631,896,223 and 179,602,756 shares of
beneficial interest issued and outstanding)............. $ 9.09
===============
Class C Shares:
Net asset value and offering price per share (Based on
net assets of $408,726,582 and 44,999,074 shares of
beneficial interest issued and outstanding)............. $ 9.08
===============
</Table>
28 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL STATEMENTS continued
Statement of Operations
For the Six Months Ended January 31, 2005 (Unaudited)
<Table>
INVESTMENT INCOME:
Interest from unaffiliated securities....................... $ 49,069,160
Interest from affiliated securities......................... 1,103,359
Dividends................................................... 670,593
Other....................................................... 1,901,628
-------------
Total Income............................................ 52,744,740
-------------
EXPENSES:
Investment Advisory Fee..................................... 8,825,820
Administrative Fee.......................................... 2,579,015
Shareholder Services........................................ 1,136,231
Legal....................................................... 437,293
Custody..................................................... 321,511
Service Fees--Class C....................................... 274,593
Trustees' Fees and Related Expenses......................... 122,354
Interest Expense............................................ 29,141
Other....................................................... 1,000,550
-------------
Total Expenses.......................................... 14,726,508
Less Credits Earned on Cash Balances.................... 23,293
-------------
Net Expenses............................................ 14,703,215
-------------
NET INVESTMENT INCOME....................................... $ 38,041,525
=============
REALIZED AND UNREALIZED GAIN/LOSS:
Net Realized Loss on unaffiliated securities................ $ (22,136,718)
Net Realized Loss on affiliated securities.................. (2,912,137)
-------------
$ (25,048,855)
-------------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... (101,016,241)
End of the Period......................................... (60,962,496)
-------------
Net Unrealized Appreciation During the Period............... 40,053,745
-------------
NET REALIZED AND UNREALIZED GAIN............................ $ 15,004,890
=============
NET INCREASE IN NET ASSETS FROM OPERATIONS.................. $ 53,046,415
=============
</Table>
See Notes to Financial Statements 29
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets (Unaudited)
<Table>
<Caption>
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
JANUARY 31, 2005 JULY 31, 2004
---------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.................................... $ 38,041,525 $ 72,149,267
Net Realized Gain/Loss................................... (25,048,855) 3,283,192
Net Unrealized Appreciation During the Period............ 40,053,745 165,681,058
-------------- --------------
Change in Net Assets from Operations..................... 53,046,415 241,113,517
-------------- --------------
Distributions from Net Investment Income:
Class B Shares......................................... (28,049,686) (53,435,973)
Class C Shares......................................... (5,817,061) (7,235,174)
-------------- --------------
(33,866,747) (60,671,147)
-------------- --------------
Return of Capital Distribution:
Class B Shares......................................... -0- (4,687,687)
Class C Shares......................................... -0- (913,897)
-------------- --------------
-0- (5,601,584)
-------------- --------------
Total Distributions...................................... (33,866,747) (66,272,731)
-------------- --------------
NET CHANGE IN NET ASSETS FROM INVESTMENT ACTIVITIES...... 19,179,668 174,840,786
-------------- --------------
FROM CAPITAL TRANSACTIONS:
Proceeds from Shares Sold................................ 163,825,284 154,047,111
Net Asset Value of Shares Issued Through Dividend
Reinvestment........................................... 17,751,794 34,951,648
Cost of Shares Repurchased............................... (195,315,764) (450,817,629)
-------------- --------------
NET CHANGE IN NET ASSETS FROM CAPITAL TRANSACTIONS....... (13,738,686) (261,818,870)
-------------- --------------
TOTAL INCREASE/DECREASE IN NET ASSETS.................... 5,440,982 (86,978,084)
NET ASSETS:
Beginning of the Period.................................. 2,035,181,823 2,122,159,907
-------------- --------------
End of the Period (Including accumulated undistributed
net investment income of $779,047 and ($3,395,731),
respectively).......................................... $2,040,622,805 $2,035,181,823
============== ==============
</Table>
30 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL STATEMENTS continued
Statement of Cash Flows
For the Six Months Ended January 31, 2005 (Unaudited)
<Table>
CHANGE IN NET ASSETS FROM OPERATIONS........................ $ 53,046,415
-------------
Adjustments to Reconcile the Change in Net Assets from
Operations to Net Cash provided by Operating Activities:
Increase in Investments at Value.......................... (20,409,964)
Increase in Interest and Fees Receivables................. (1,735,175)
Decrease in Receivable for Investments Sold............... 2,878,550
Decrease in Other Assets.................................. 31,006
Decrease in Payable for Investments Purchased............. (1,200,151)
Decrease in Investment Advisory Fee Payable............... (4,398)
Decrease in Distributor and Other Affiliates Payable...... (131,578)
Decrease in Administrative Fee Payable.................... (1,377)
Increase in Accrued Expenses.............................. 131,268
Increase in Trustees' Deferred Compensation and Retirement
Plans................................................... 104,694
-------------
Total Adjustments....................................... (20,337,125)
-------------
NET CASH PROVIDED BY OPERATING ACTIVITIES................... 32,709,290
-------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Shares Sold................................... 148,714,103
Change in Bank Borrowings................................... 35,000,000
Cash Dividends Paid......................................... (16,055,970)
Payments on Shares Repurchased.............................. (195,325,423)
Change in Accrued Interest Expense.......................... 29,141
Change in Intra-day Credit Line with Custodian Bank......... (1,758)
-------------
Net Cash Used for Financing Activities.................. (27,639,907)
-------------
NET INCREASE IN CASH........................................ 5,069,383
Cash at Beginning of the Period............................. -0-
-------------
CASH AT THE END OF THE PERIOD............................... $ 5,069,383
=============
</Table>
Supplemental disclosure of cash flow information: Non cash financing activities
not included herein consist of reinvestment of dividends and distributions of
$17,751,794.
See Notes to Financial Statements 31
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL HIGHLIGHTS (UNAUDITED)
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
FUND OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
SIX MONTHS
ENDED YEAR ENDED JULY 31,
CLASS B SHARES JANUARY 31, ------------------------------------------------------------------------
2005 2004 2003 2002 2001 2000
--------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING
OF THE PERIOD........... $ 9.00 $ 8.29 $ 8.09 $ 8.61 $ 9.50 $ 9.85
-------- -------- -------- -------- -------- --------
Net Investment Income... .17(c) .30(c) .33(c) .41(c) .66(c) .68
Net Realized and
Unrealized
Gain/Loss............. .07 .68 .19 (.55) (.86) (.36)
-------- -------- -------- -------- -------- --------
Total from Investment
Operations.............. .24 .98 .52 (.14) (.20) .32
-------- -------- -------- -------- -------- --------
Less:
Distributions from Net
Investment Income..... .15 .25 .29 .38 .69 .67
Return of Capital
Distributions......... -0- .02 .03 -0- -0- -0-
-------- -------- -------- -------- -------- --------
Total Distributions....... .15 .27 .32 .38 .69 .67
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF
THE PERIOD.............. $ 9.09 $ 9.00 $ 8.29 $ 8.09 $ 8.61 $ 9.50
======== ======== ======== ======== ======== ========
Total Return (a).......... 2.58%* 12.03% 6.58% -1.61% -2.11% 3.15%
Net Assets at End of the
Period (In millions).... $1,631.9 $1,703.1 $1,876.1 $2,558.7 $3,989.7 $6,458.0
Ratio of Expenses to
Average Net Assets...... 1.41% 1.48% 1.54% 1.43% 1.43% 1.34%
Ratio of Net Investment
Income to Average Net
Assets.................. 3.71% 3.44% 4.21% 4.85% 7.34% 6.97%
Portfolio Turnover (b).... 48%* 94% 49% 36% 42% 36%
</Table>
(a) Total return assumes an investment at the beginning of the period indicated,
reinvestment of all distributions for the period and tender of all shares at
the end of the period indicated, excluding payment of the 3% imposed on most
shares accepted by the Fund for repurchase within the first year and
declining to 0% after the fifth year. If the early withdrawal charge was
included, total return would be lower.
(b) Calculation includes the proceeds from principal repayments and sales of
variable rate senior loan interests.
(c) Based on average shares outstanding.
* Non-annualized
32 See Notes to Financial Statements
VAN KAMPEN SENIOR LOAN FUND
FINANCIAL HIGHLIGHTS (UNAUDITED) continued
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
FUND OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
JUNE 13, 2003
(COMMENCEMENT OF
SIX MONTHS YEAR INVESTMENT
ENDED ENDED OPERATIONS) TO
CLASS C SHARES JANUARY 31, JULY 31, JULY 31,
2005 2004 2003
-------------------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD........ $ 9.00 $ 8.29 $ 8.16
------ ------ ------
Net Investment Income......................... .16(c) .28(c) .04(c)
Net Realized and Unrealized Gain.............. .06 .69 .12
------ ------ ------
Total from Investment Operations................ .22 .97 .16
------ ------ ------
Less:
Distributions from Net Investment Income...... .14 .24 .03
Return of Capital Distributions............... -0- .02 -0-
------ ------ ------
Total Distributions............................. .14 .26 .03
------ ------ ------
NET ASSET VALUE, END OF THE PERIOD.............. $ 9.08 $ 9.00 $ 8.29
====== ====== ======
Total Return (a)................................ 2.51%* 11.86% 2.02%*
Net Assets at End of the Period (In millions)... $408.7 $332.0 $246.1
Ratio of Expenses to Average Net Assets......... 1.53% 1.62% 1.56%
Ratio of Net Investment Income to Average Net
Assets........................................ 3.59% 3.26% 3.89%
Portfolio Turnover (b).......................... 48%* 94% 49%
</Table>
(a) Total return assumes an investment at the beginning of the period indicated,
reinvestment of all distributions for the period and tender of all shares at
the end of the period indicated, excluding payment of the 1% imposed on most
shares accepted by the Fund for repurchase which have been held for less
than one year. If the early withdrawal charge was included, total return
would be lower.
(b) Calculation includes the proceeds from principal repayments and sales of
variable rate senior loan interests.
(c) Based on average shares outstanding.
* Non-annualized
See Notes to Financial Statements 33
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Senior Loan Fund (the "Fund") is registered as a non-diversified,
closed-end management investment company under the Investment Company Act of
1940 (the "1940 Act"), as amended. 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 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 commenced
investment operations on October 4, 1989. In June 2003, the Fund completed a
transaction in which it redesignated its shares issued before June 13, 2003 as
Class B Shares and issued new Class C Shares to the shareholders of Van Kampen
Senior Floating Rate Fund in exchange for the assets and liabilities of that
fund. Effective February 18, 2005, the Van Kampen Senior Loan Fund B and C share
classes were renamed Class IB and Class IC Shares, respectively. Also, effective
February 18, 2005, the Fund seeded new Class A, Class B and Class C Shares. (See
Note 12.)
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
A. SECURITY VALUATION The Fund's Senior Loans are valued by the Fund following
valuation guidelines established and periodically reviewed by the Fund's Board
of Trustees. Under the valuation guidelines, Senior Loans for which reliable
market quotes are readily available are valued at the mean of such bid and ask
quotes. Where reliable market quotes are not readily available, Senior Loans are
valued, where possible, using independent market indicators provided by
independent pricing sources approved by the Board of Trustees. Other Senior
Loans are valued by independent pricing sources approved by the Board of
Trustees based upon pricing models developed, maintained and operated by those
pricing sources or valued by Van Kampen Asset Management (the "Adviser") by
considering a number of factors including consideration of market indicators,
transactions in instruments which the Adviser believes may be comparable
(including comparable credit quality, interest rate redetermination period and
maturity), the credit worthiness of the Borrower, the current interest rate, the
period until the next interest rate redetermination and the maturity of such
Senior Loans. Consideration of comparable instruments may include commercial
paper, negotiable certificates of deposit and short-term variable rate
securities which have adjustment periods comparable to the Senior Loans in the
Fund's portfolio. The fair value of Senior Loans are reviewed and approved by
the Fund's Valuation Committee and Board of Trustees.
Equity securities are valued on the basis of prices furnished by pricing
services or at fair value as determined in good faith by the Adviser under the
direction of the Board of Trustees.
Short-term securities with remaining maturities of 60 days or less are
valued at amortized cost, which approximates market value. Short-term loan
participations are valued at cost in the absence of any indication of
impairment. The Fund may invest in repurchase
34
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
agreements, which are short-term investments in which the Fund acquires
ownership of a debt security and the seller agrees to repurchase the security at
a future time and specified price. Repurchase agreements are fully
collateralized by the underlying debt security. The Fund will make payment for
such securities only upon physical delivery or evidence of book entry transfer
to the account of the custodian bank. The seller is required to maintain the
value of the underlying security at not less than the repurchase proceeds due
the Fund.
B. SECURITY TRANSACTIONS Investment transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis.
Legal expenditures that are expected to result in the restructuring of or a plan
of reorganization for an investment are recorded as realized losses.
C. INVESTMENT INCOME Dividend income is recorded on the ex-dividend date and
interest income is recorded on an accrual basis. Facility fees on senior loans
purchased are treated as market discounts. Market premiums are amortized and
discounts are accreted over the stated life of each applicable senior loan, note
or other fixed-income security.
Other income is comprised primarily of amendment fees which are recorded
when received. Amendment fees are earned as compensation for agreeing to changes
in loan agreements. Income, expenses and realized and unrealized gains or losses
are allocated on a pro-rata basis to each class of shares except for service
fees, which are applicable only to Class C shares.
D. FEDERAL INCOME TAXES It is the Fund's policy to comply with the requirements
of Subchapter M of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required.
The Fund intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At July 31, 2004, the Fund had an accumulated capital loss carryforward
for tax purposes of $959,524,180, which will expire according to the following
schedule.
<Table>
<Caption>
AMOUNT EXPIRATION
$ 230,325................................................ July 31, 2006
25,341,287................................................ July 31, 2007
81,119,357................................................ July 31, 2008
99,303,946................................................ July 31, 2009
442,991,545................................................ July 31, 2010
157,279,859................................................ July 31, 2011
153,257,861................................................ July 31, 2012
</Table>
35
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
At January 31, 2005, the cost and related gross unrealized appreciation and
depreciation are as follows:
<Table>
Cost of investments for tax purposes........................ $2,186,572,409
==============
Gross tax unrealized appreciation........................... $ 58,851,747
Gross tax unrealized depreciation........................... (163,356,589)
--------------
Net tax unrealized depreciation on investments.............. $ (104,504,842)
==============
</Table>
E. DISTRIBUTION OF INCOME AND GAINS The Fund declares daily and pays monthly
dividends from net investment income. Net realized gains, if any, are
distributed at least annually. Distributions from net realized gains for book
purposes may include short-term capital gains, which are included as ordinary
income for tax purposes.
The tax character of distributions paid during the year ended July 31, 2004
was as follows:
<Table>
<Caption>
2004
Distributions paid from:
Ordinary income........................................... $60,620,611
Long-term capital gain.................................... 5,601,584
-----------
$66,222,195
===========
</Table>
Net realized gains or losses may differ for financial and tax reporting
purposes primarily as a result of the deferral of losses related to wash sale
transactions and losses that were recognized for book purposes but not for tax
purposes at the end of the fiscal year.
F. CREDITS EARNED ON CASH BALANCES During the six months ended January 31, 2005,
the Fund's custody fee was reduced by $23,293 as a result of credits earned on
cash balances.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Fund's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Fund for an annual fee payable
monthly as follows:
<Table>
<Caption>
AVERAGE DAILY NET ASSETS % PER ANNUM
First $500 million.......................................... .900%
Next $1.0 billion........................................... .850%
Next $1.0 billion........................................... .825%
Next $500 million........................................... .800%
Over $3.0 billion........................................... .775%
</Table>
In addition, the Fund will pay a monthly administrative fee to Van Kampen
Funds Inc., the Fund's Administrator, at an annual rate of .25% of the average
daily net assets of the Fund. The administrative services provided by the
Administrator include 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.
36
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
For the six months ended January 31, 2005, the Fund recognized expenses of
approximately $299,300 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Fund, of which a Trustee of the Fund
is a partner of such firm and he and his law firm provide legal services as
legal counsel to the Fund.
Under a Legal Services agreement, the Adviser provides legal services to the
Fund. The Adviser allocates the cost of such services to each Fund. For the six
months ended January 31, 2005, the Fund recognized expenses of approximately
$53,700 representing Van Kampen Investments Inc.'s or its affiliates
(collectively "Van Kampen") cost of providing legal services to the Fund, which
are reported as part of the "Legal" expenses in the Statement of Operations.
Van Kampen Investor Services Inc. (VKIS), an affiliate of the Adviser,
serves as the shareholder servicing agent of the Fund. For the six months ended
January 31, 2005, the Fund recognized expenses for these services of
approximately $861,800 representing transfer agency fees paid to VKIS. Transfer
agency fees are determined through negotiations with the Fund's Board of
Trustees.
Certain officers and Trustees of the Fund are also officers and directors of
Van Kampen. The Fund does not compensate its officers or Trustees who are also
officers of Van Kampen.
The Fund provides deferred compensation and retirement plans for its
Trustees who are not officers of Van Kampen. Under the deferred compensation
plan, Trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable upon retirement for a
ten-year period and are based upon each Trustee's years of service to the Fund.
The maximum annual benefit per Trustee under the plan is $2,500.
During the period, the Fund owned shares of the following affiliated
companies. Affiliated companies are defined by the Investment Company Act of
1940, as amended, as those companies in which a Fund holds 5% or more of the
outstanding voting securities.
<Table>
<Caption>
INTEREST/ MARKET
PAR/ REALIZED DIVIDEND VALUE
NAME SHARES* GAIN/(LOSS) INCOME 01/31/05 COST
Chart Industries,
Inc.--Term Loan...... $ 5,353,162 $ (268,721) $ 164,625 $ 5,386,619 $ 6,317,877
Chart Industries,
Inc.--Common
Shares............... 325,454 567,521 0 15,947,246 6,914,656
DecorateToday.com--
Common Shares........ 198,600 0 0 2,557,968 3,505,909
Imperial Home Decor
Group, Inc.--Term
Loan................. $ 5,044,842 0 0 126,121 5,015,112
Imperial Home Decor
Group, Inc.--Common
Shares............... 1,816,143 0 0 0 1,852,465
London Fog Industries,
Inc.--Common Shares.. 515,922 0 0 3,405,085 33,576,536
Neoplan USA
Corp.--Revolver...... $ 933,750 0 30,297 933,750 933,750
</Table>
37
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
<Table>
<Caption>
INTEREST/ MARKET
PAR/ REALIZED DIVIDEND VALUE
NAME SHARES* GAIN/(LOSS) INCOME 01/31/05 COST
Neoplan USA Corp.--
Common Shares........ 8,517 0 0 85 85
Neoplan USA Corp.--
Preferred Shares..... 2,262 0 0 2,262 1,074,522
Orius Corp.-- Term
Loan................. $ 6,272,014 236,327 213,316 1,334,725 3,090,594
Orius
Corp.--Revolver...... $ 4,330,904 0 119,819 3,356,451 3,418,256
Orius Corp.--Common
Shares............... 1,211,236 0 0 0 4,330,904
Safelite Glass Corp.--
Term Loan............ $17,889,124 0 573,302 15,339,924 17,860,546
Safelite Glass Corp.--
Common Shares........ 724,479 0 0 0 3,912,187
Safelite Reality--
Common Shares........ 48,903 0 0 0 0
Transworld
Entertainment Corp.--
Common Shares........ 3,451,962 (2,328,820) 0 43,322,123 63,299,979
----------- ----------
$(1,793,693) $1,101,359
=========== ==========
</Table>
* Shares were acquired through the restructuring of senior loan interests.
Affiliate transactions during the six months ended January 31, 2005 were as
follows:
<Table>
<Caption>
PAR/SHARES PAR/SHARES
AS OF GROSS GROSS AS OF REALIZED
NAME 07/31/04 ADDITIONS REDUCTIONS 01/31/05 GAIN/(LOSS)
Aspen Marketing Group, Term
Loan..................... $2,508,426 -- $ (216,697) $2,291,729 0
Aspen Marketing Group,
Revolver................. $7,620,725 -- $(7,620,725) $ -- $ 2,745,253
Aspen Marketing Group,
Common Shares............ 166,871 -- (166,871) -- (3,863,697)
Chart Industries, Term
Loan..................... $6,770,456 -- $(1,417,294) $5,353,162 (268,721)
Chart Industries, Common
Shares................... 345,454 -- (20,000) 325,454 567,521
Neoplan USA Corp.,
Revolver................. $ 911,250 $22,500 -- $ 933,750 0
Orius Corp., Term Loan..... $6,608,678 -- $ (336,664) $6,272,014 236,327
Transworld Entertainment
Corp., Common Shares..... 3,789,962 -- (338,000) 3,451,962 (2,328,820)
-----------
$(2,912,137)
===========
</Table>
38
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
3. CAPITAL TRANSACTIONS
At January 31, 2005, capital aggregated $2,639,924,817 and $565,317,858 for
Classes B and C, respectively. For the six months ended January 31, 2005,
transactions were as follows:
<Table>
<Caption>
SHARES VALUE
Sales:
Class B................................................... 7,542,874 $ 68,277,803
Class C................................................... 10,573,423 95,547,481
----------- -------------
Total Sales................................................. 18,116,297 $ 163,825,284
=========== =============
Dividend Reinvestment:
Class B................................................... 1,677,595 $ 15,155,103
Class C................................................... 287,422 2,596,691
----------- -------------
Total Dividend Reinvestment................................. 1,965,017 $ 17,751,794
=========== =============
Repurchases:
Class B................................................... (18,848,973) $(170,310,745)
Class C................................................... (2,766,756) (25,005,019)
----------- -------------
Total Repurchases........................................... (21,615,729) $(195,315,764)
=========== =============
</Table>
At July 31, 2004, capital aggregated $2,726,802,656 and $492,178,705 for
Classes B and C, respectively. For the year ended July 31, 2004, transactions
were as follows:
<Table>
<Caption>
SHARES VALUE
Sales:
Class B................................................... 4,640,807 $ 40,897,370
Class C................................................... 12,758,204 113,149,741
----------- -------------
Total Sales................................................. 17,399,011 $ 154,047,111
=========== =============
Dividend Reinvestment:
Class B................................................... 3,570,320 $ 31,188,668
Class C................................................... 430,382 3,762,980
----------- -------------
Total Dividend Reinvestment................................. 4,000,702 $ 34,951,648
=========== =============
Repurchases:
Class B................................................... (45,234,810) $(398,226,471)
Class C................................................... (5,969,999) (52,591,158)
----------- -------------
Total Repurchases........................................... (51,204,809) $(450,817,629)
=========== =============
</Table>
4. INVESTMENT TRANSACTIONS
During the period, the costs of purchases and proceeds from investments sold and
repaid, excluding short-term investments, were $1,024,831,249 and $969,960,504,
respectively.
5. TENDER OF SHARES
The Board of Trustees currently intends, each quarter, to consider authorizing
the Fund to make tender offers for all or a portion of its then outstanding
common shares at the net
39
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
asset value of the shares on the expiration date of the tender offer. Effective
February 3, 2005, the Board of Trustees approved a new fundamental policy
whereby the Fund commits to make regular offers to repurchase shares of the
Fund. Initially, the Fund will be making quarterly offers to repurchase up to
15% of its then outstanding shares. The Fund is seeking exemptive relief from
the Securities and Exchange Commission ("SEC") to enable the Fund to conduct
monthly repurchase offers. At present, the Fund expects that upon receiving such
exemptive relief, it would conduct monthly repurchase offers for 5% of its
outstanding shares. The Fund cannot guarantee that the SEC will grant exemptive
relief. There is no guarantee that you will be able to sell your Shares at any
given time. For the six months ended January 31, 2005, 21,615,729 shares were
tendered and repurchased by the Fund.
6. EARLY WITHDRAWAL CHARGE
An early withdrawal charge to recover offering expenses will be imposed in
connection with most Class B shares held for less than five years and Class C
shares held less than one year which are accepted by the Fund for repurchase
pursuant to tender offers. The early withdrawal charge will be payable to Van
Kampen. Any early withdrawal charge which is required to be imposed will be made
in accordance with the following schedule.
<Table>
<Caption>
WITHDRAWAL WITHDRAWAL
CHARGE CHARGE
------------------------
YEAR OF REDEMPTION CLASS B CLASS C
First....................................................... 3.0% 1.0%
Second...................................................... 2.5% --
Third....................................................... 2.0% --
Fourth...................................................... 1.5% --
Fifth....................................................... 1.0% --
Sixth and following......................................... -- --
</Table>
Effective February 18, 2005, the above early withdrawal schedule has been
terminated. (See Note 12.) For the six months ended January 31, 2005, Van Kampen
received early withdrawal charges of approximately $218,800, in connection with
tendered shares of the Fund.
7. COMMITMENTS/BORROWINGS
Pursuant to the terms of certain of the Senior Loan agreements, the Fund had
unfunded loan commitments of approximately $114,475,100 as of January 31, 2005.
The Fund intends to reserve against such contingent obligations by designating
cash, liquid securities, and liquid senior loans as a reserve.
The Fund has entered into a revolving credit agreement for an aggregate of
$300,000,000, which will terminate on November 12, 2005. The proceeds of any
borrowing by the Fund under the revolving credit agreement shall be used for
temporary liquidity purposes and funding of shareholder tender offers. Annual
commitment fees of .13% are charged on the unused portion of the credit line.
For the six months ended January 31, 2005, the Fund recognized commitment fee
expenses of approximately $257,900.
Borrowings under this facility will bear interest at the Eurodollar rate
plus 1.00%. For the six months ended January 31, 2005, the average daily balance
of borrowings under the revolving credit agreement was $2,364,130 with a
weighted average interest rate of 2.44%.
40
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
8. SENIOR LOAN PARTICIPATION COMMITMENTS
The Fund invests primarily 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 January 31, 2005, the following sets forth the selling participants with
respect to interests in Senior Loans purchased by the Fund on a participation
basis.
<Table>
<Caption>
PRINCIPAL
AMOUNT VALUE
SELLING PARTICIPANT (000) (000)
Bank of America............................................. $3,417 $3,434
------ ------
Total....................................................... $3,417 $3,434
====== ======
</Table>
9. SERVICE PLAN
For Class C, the Fund has adopted a Service Plan (the "Plan") designed to meet
the service fee requirements of the sales charge rule of the National
Association of Securities Dealers, Inc. The Plan governs payments for personal
services and/or the maintenance of shareholder accounts.
Annual fees under the Plan of .15% (.25% maximum) of average daily net
assets are accrued daily and paid monthly for Class C. Of this amount, Van
Kampen paid Morgan Stanley DW Inc., an affiliate of the Advisor, approximately
$53,000 for the six months ended January 31, 2005. Effective February 18, 2005,
the distributor, Van Kampen Funds Inc. ("Distributor") began waiving this
service fee. (See Note 12.)
10. LITIGATION
On September 28, 2001 and October 11, 2001, separate complaints were filed in
the United States District Court for the Northern District of Illinois each by a
shareholder of the Fund against the Fund, the Adviser, Van Kampen Funds Inc. and
certain directors and officers of the Fund. The respective complaints, framed as
class actions, allege misstatements and omissions in the Fund's registration
statements in violation of the federal securities laws. The separate complaints
were consolidated on or about December 15, 2001, and the class was certified on
or about August 26, 2002. The consolidated action is entitled Abrams et al. v.
Van Kampen Funds, Inc., et al., No. 01 C 7538 (N.D. Ill., Hart J.). The ultimate
outcome of this action is not presently determinable and no provision has been
made in the Fund's financial statements for the effect, if any, of this action.
11. INDEMNIFICATIONS
The Fund enters into contracts that contain a variety of indemnifications. The
Fund's maximum exposure under these arrangements is unknown. However, the Fund
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.
12. OFFERING OF NEW SHARE CLASSES
On February 18, 2005, the Fund redesignated its Class B Shares issued before
February 18, 2005 as a new class of Shares designated Class IB Shares and
redesignated its Class C Shares
41
VAN KAMPEN SENIOR LOAN FUND
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
issued before February 18, 2005 as a new class of Shares designated Class IC
Shares. On February 18, 2005, the Fund commenced offering new Class A Shares,
new Class B Shares and new Class C Shares (the new Class B Shares and new Class
C Shares have different fees, expenses and characteristics than the original
classes of Class B Shares and Class C Shares). The Class IB Shares and Class IC
Shares are not continuously offered. The only new Class IB Shares and Class IC
Shares to be issued after February 18, 2005 are those Class IB Shares and Class
IC Shares issued to satisfy dividend and capital gain reinvestments. Shares of
each of new Class A Shares, new Class B Shares and new Class C Shares are sold
at their offering price, which is based upon the net asset value per Share for
such class of Shares plus sales charges where applicable. New Class A Shares are
subject to an up front sales charge of up to 3.25%. There is no initial sales
charge or underwriting discount on purchases of new Class B and new Class C
Shares but such Shares are subject to early withdrawal charges which will be
made in accordance with the following schedule:
<Table>
<Caption>
WITHDRAWAL WITHDRAWAL
CHARGE CHARGE
--------------------------
YEAR OF REDEMPTION NEW CLASS B NEW CLASS C
First....................................................... 3.0% 1.0%
Second...................................................... 2.5% --
Third....................................................... 2.0% --
Fourth...................................................... 1.5% --
Fifth....................................................... 1.0% --
Sixth and following......................................... -- --
</Table>
The Class IB Shares and Class IC Shares have no early withdrawal charges
(the early withdrawal schedule applicable to the former Class B Shares and
former Class C Shares outstanding on February 18, 2005 has been terminated).
Effective February 18, 2005, the Fund has adopted a distribution plan (the
"Distribution Plan") with respect to each of its new Class A Shares, new Class B
Shares and new Class C Shares and in so doing has agreed to comply with Rule
12b-1 under the Investment Company Act of 1940, as amended (the "1940 Act"), as
if the Fund were an open-end investment company. The Fund also has adopted a
service plan (the "Service Plan") with respect to each of its new Class A
Shares, new Class B Shares, new Class C Shares and Class IC Shares. There is no
Distribution Plan or Service Plan for the Class IB Shares and no Distribution
Plan for the Class IC Shares. All service fees under the Service Plan applicable
to new Class A Shares, new Class B Shares, new Class C Shares and Class IC
Shares are currently being waived. Under the Distribution Plan and Service Plan,
the Fund pays distribution fees in connection with the sale and distribution of
its Shares and service fees in connection with the provision of ongoing services
to shareholders of each such class and the maintenance of shareholder accounts.
Under the Distribution Plan and the Service Plan, the Fund may spend up to a
total of 0.25%, 1.00% and 1.00% per year of the average daily net assets of new
Class A Shares, new Class B Shares and new Class C Shares, respectively. Due to
voluntary fee waivers by the Distributor, the aggregate distribution and service
fees are currently 0.00%, 0.75% and 0.75% per year of the average daily net
assets for new Class A Shares, new Class B Shares and new Class C Shares,
respectively. Annual fees under the Distribution Plan and Service Plan are
accrued daily. The net annual fees for new Class B Shares and new Class C Shares
are paid monthly.
42
VAN KAMPEN SENIOR LOAN FUND
BOARD OF TRUSTEES AND IMPORTANT ADDRESSES
BOARD OF TRUSTEES
DAVID C. ARCH
ROD DAMMEYER
HOWARD J KERR
RICHARD F. POWERS, III* - Chairman
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN*
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, New York 10020
DISTRIBUTOR
VAN KAMPEN FUNDS INC.
1221 Avenue of the Americas
New York, New York 10020
SHAREHOLDER SERVICING AGENT
VAN KAMPEN INVESTOR SERVICES INC.
P.O. Box 947
Jersey City, New Jersey 07303-0947
CUSTODIAN
STATE STREET BANK
AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02110
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
DELOITTE & TOUCHE LLP
180 North Stetson Avenue
Chicago, Illinois 60601
* "Interested persons" of the Fund, as defined in the Investment Company Act
of 1940, as amended.
43
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY
We are required by federal law to provide you with a copy of our Privacy
Policy annually.
The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc.,
Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van Kampen Exchange
Corp., as well as current and former individual investors in Van Kampen mutual
funds, unit investment trusts, and related companies.
This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised by
us. This Policy is, however, applicable to individuals who select us to be a
custodian of securities or assets in individual retirement accounts, 401(k)
accounts, 529 Educational Savings Accounts, accounts subject to the Uniform
Gifts to Minors Act, or similar accounts.
Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.
WE RESPECT YOUR PRIVACY
We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we help
you achieve your financial objectives. This Policy describes what non-public
personal information we collect about you, why we collect it, and when we may
share it with others.
We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you or
your accounts as "personal information."
1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?
To serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and other
sources.
For example:
-- We may collect information such as your name, address, e-mail address,
telephone/fax numbers, assets, income and investment objectives through
applications and other forms you submit to us.
-- We may obtain information about account balances, your use of
account(s) and the types of products and services you prefer to receive
from us through your dealings and transactions with us and other
sources.
-- We may obtain information about your creditworthiness and credit
history from consumer reporting agencies.
-- We may collect background information from and through third-party
vendors to verify representations you have made and to comply with
various regulatory requirements.
-- If you interact with us through our public and private Web sites, we
may collect information that you provide directly through online
communications (such as an e-mail address). We may also collect
information about your Internet service provider, your domain name,
your computer's operating system and Web browser,
(continued on back)
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY continued
your use of our Web sites and your product and service preferences,
through the use of "cookies." "Cookies" recognize your computer each
time you return to one of our sites, and help to improve our sites'
content and personalize your experience on our sites by, for example,
suggesting offerings that may interest you. Please consult the Terms of
Use of these sites for more details on our use of cookies.
2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?
To provide you with the products and services you request, to serve you better
and to manage our business, we may disclose personal information we collect
about you to our affiliated companies and to non-affiliated third parties as
required or permitted by law.
A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise required
or permitted by law.
B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except to
enable them to provide services on our behalf, to perform joint marketing
agreements with other financial institutions, or as otherwise required or
permitted by law. For example, some instances where we may disclose information
about you to non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against fraud,
for institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these companies,
they are required to limit their use of personal information to the particular
purpose for which it was shared and they are not allowed to share personal
information with others except to fulfill that limited purpose.
3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL INFORMATION WE
COLLECT ABOUT YOU?
We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties that
provide support or marketing services on our behalf may also receive personal
information, and we require them to adhere to confidentiality standards with
respect to such information.
Van Kampen Funds Inc.
1 Parkview Plaza, P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
Copyright (C)2005 Van Kampen Funds Inc. All rights reserved.
Member NASD/SIPC. 59, 359
SLF SAR 3/05 RA05-00174P-Y01/05
(VAN KAMPEN INVESTMENTS LOGO)
Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable for semi-annual reports.
Item 6. Schedule of Investments.
Please refer to Item #1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
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.
Not applicable.
Item 11. Controls and Procedures
(a) The Fund's principal executive officer and principal financial officer have
concluded that the Fund's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Fund in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
(the registrant's second fiscal half-year in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(a) Code of Ethics-- Not applicable for semi-annual reports.
(b)(1) A certification for the Principal Executive Officer of the registrant is
attached hereto as part of EX-99.CERT.
(b)(2) A certification for the Principal Financial Officer of the registrant is
attached hereto as part of EX-99.CERT.
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) Van Kampen Senior Loan Fund
By: /s/ Ronald E. Robison
----------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: March 22, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
----------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: March 22, 2005
By: /s/ James W. Garrett
--------------------
Name: James W. Garrett
Title: Principal Financial Officer
Date: March 22, 2005