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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-08773
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Van Kampen Senior Income Trust
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(Exact name of registrant as specified in charter)
1221 Avenue of the Americas New York, New York 10020
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(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas New York, New York 10020
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(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
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Date of fiscal year end: 7/31
----
Date of reporting period: 7/31/05
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Item 1. Reports to Shareholders.
The Trust's 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 Income Trust performed during the annual 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 trust's
financial statements and a list of trust investments as of July 31, 2005.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
OBJECTIVE. THE TRUST IS SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
THAT THE VALUE OF THE TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU
PAID FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.
PLEASE SEE THE PROSPECTUS FOR MORE COMPLETE INFORMATION ON INVESTMENT
RISKS.
AN INVESTMENT IN SENIOR LOANS IS SUBJECT TO CERTAIN RISKS SUCH AS LOAN
DEFAULTS AND ILLIQUIDITY DUE TO INSUFFICIENT COLLATERAL BACKING.
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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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Performance Summary as of 7/31/05
SENIOR INCOME TRUST
SYMBOL: VVR
-----------------------------------------------------------
AVERAGE ANNUAL BASED ON BASED ON
TOTAL RETURNS NAV MARKET PRICE
Since Inception (6/24/98) 5.36% 4.51%
5-year 4.74 5.58
1-year 6.36 -2.03
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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 TRUST SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
The NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities and preferred shares, by
the total number of common shares outstanding. The common share market price is
the price the market is willing to pay for shares of the trust at a given time.
Common share market price is influenced by a range of factors, including supply
and demand and market conditions. Total return assumes an investment at the
beginning of the period, reinvestment of all distributions for the period in
accordance with the trust's dividend reinvestment plan, and sale of all shares
at the end of the period.
1
Trust Report
FOR THE 12-MONTH PERIOD ENDED JULY 31, 2005
Van Kampen Senior Income Trust is managed by the Adviser's Senior Loans team,
led by Howard Tiffen, Managing Director of the Adviser.(1)
MARKET CONDITIONS
The senior loan market demonstrated continued strength for the 12-month period
ended July 31, 2005. Despite rising oil prices, the pace of economic growth
stayed on track and inflation remained contained. Many corporations posted
earnings announcements that reflected healthy balance sheets and well-executed
strategies. A weakening U.S. dollar further benefited a number of companies
within the senior loan market, including those in the chemical, steel, and
forest product and paper industries. (A weaker dollar makes U.S. exports more
competitive in foreign markets, while making foreign imports more expensive to
U.S. consumers). Against this backdrop of enhanced profitability, the credit
quality of corporate debt improved and helped to boost the senior loan market.
Companies actively took advantage of this favorable environment and issued a
significant amount of new senior loans during the period. This issuance was more
than met by investor demand, which was strong across both the primary and
secondary markets. Continuing the trends of recent years, improving credit
qualities and significantly lower default rates encouraged increased
participation in the senior loan market, particularly among institutional
investors. The sector's appeal was further enhanced by rising short- and
intermediate-term interest rates, which buoyed the yields of senior loans and
underscored the defensive characteristics of the asset class. (The yields of
senior loans adjust in response to changes in short-term interest rates.)
(1)Team members may change without notice from time to time.
2
PERFORMANCE ANALYSIS
The trust's return can be calculated based upon either the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities and preferred shares, by the total number of common shares
outstanding, while market price reflects the supply and demand for the shares.
As a result, the two returns can differ, as they did during the reporting
period.
For the 12 months ended July 31, 2005, the trust returned -2.03 percent on a
market price basis and 6.36 percent on an NAV basis.
TOTAL RETURNS FOR THE 12-MONTH PERIOD ENDED JULY 31, 2005
------------------------------------------------
BASED ON NAV BASED ON MARKET PRICE
6.36% -2.03%
------------------------------------------------
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. INVESTMENT RETURN, NET ASSET VALUE AND COMMON SHARE MARKET PRICE WILL
FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. SEE PERFORMANCE SUMMARY FOR ADDITIONAL PERFORMANCE INFORMATION.
Seeking to balance attractive yields with a relatively stable net asset value,
we followed a disciplined investment approach which was anchored by our rigorous
fundamental research. Consistent with our long-standing practice, the portfolio
construction process focused upon identifying companies with strong management,
solid and predictable cash flows, and sufficient collateral in the event of
default. It is our view that the merits of this approach are reflected in the
portfolio's performance for the 12-month period and likely would be further
evidenced during a cyclical downturn.
To manage overall risk, we diversified the portfolio's assets across both
individual securities and sectors. While individual security selection drives
the investment process, we also carefully weighed broader sectors. As we have
historically, we generally eschewed the debt of cyclical companies, whose
fortunes may be particularly vulnerable to changes in the economy, preferring
instead senior loans from sectors with greater potential stability throughout
the economic cycle.
Accordingly, our investment discipline led us to more-defensive segments of the
market. We favored the defense industry, where long-term demand trends remain
supportive and companies hold considerable hard assets. We emphasized companies
that offer goods and services used on a regular basis, including food, drug and
beverage companies and ecological (waste management) companies. Meanwhile, we
were particularly cautious with automotive debt. Given the ongoing travails of
the auto sector, the outlook for specific automotive manufacturers and their
suppliers remains clouded. We avoided homebuilders due to their extreme
vulnerability to the fortunes of the real estate market; as well as
3
clothing manufacturers, where overseas competition has increased sharply. We
were similarly circumspect in regard to the telecommunications sector. Here too,
competition has been fierce, dominant technologies have changed rapidly, and
companies tend not to hold significant hard-asset collateral.
The trust benefited during the period from our use of leverage. Leverage
involves borrowing at a short-term lending rate and reinvesting the proceeds at
a higher rate. We use this strategy on an ongoing basis in an effort to enhance
the trust's dividend. Unlike with other fixed-income classes, using leverage in
conjunction with senior loans does not involve the same degree of risk from
rising short-term interest rates, since the income from senior loans adjusts to
changes in interest rates, as do the rates which determine the trust's borrowing
costs. (Similarly, should short-term rates fall, borrowing costs would also
decline.) We are likely to reduce leverage in periods of weaker credit quality
conditions to prevent magnifying erosion of the trust's net asset value.
As of the close of the reporting period, our analysis suggests continued bright
prospects for the senior loan market, and we look forward to pursuing the most
compelling opportunities. The economy has shown continued signs of growth, and
corporate profits and pricing power have remained largely intact for the
borrowers in the senior loan market. Such factors, in our view, support a
favorable environment for continued free cash flow and our expectation that
credit quality will not weaken significantly. That said, we intend to view with
added caution those companies that are heavily exposed to fuel prices.
There is no guarantee the security sectors mentioned will continue to perform
well or be held by the trust in the future.
INVESTMENT POLICY CHANGES
At a meeting held March 2 and March 3, 2005 the Board of Trustees
approved a change to the Trust's respective investment policies regarding
the current investment requirements for senior notes. The changes modify
the current limitation on senior notes. Such modification allows
investments in senior notes provided that senior notes represent the only
form of senior debt financing in the borrower's capital structure or
enjoy a pair passu position with other senior loans in the borrower's
capital structure with respect to collateral only and not with respect to
the other covenants and terms.
4
SUMMARY OF INVESTMENTS BY INDUSTRY CLASSIFICATION AS OF 7/31/05
Hotels, Motels, Inns & Gaming 7.5%
Printing & Publishing 7.0
Chemicals, Plastics & Rubber 6.6
Broadcasting--Cable 6.3
Entertainment & Leisure 6.3
Beverage, Food & Tobacco 6.0
Healthcare 5.9
Containers, Packaging & Glass 4.3
Electronics 3.9
Buildings & Real Estate 3.8
Aerospace/Defense 3.3
Natural Resources 3.3
Automotive 3.2
Ecological 2.7
Utilities 2.4
Insurance 2.1
Finance 2.0
Telecommunications--Wireless 1.7
Healthcare & Beauty 1.5
Medical Products & Services 1.4
Construction Material 1.4
Retail--Stores 1.3
Restaurants & Food Service 1.3
Telecommunications--Local Exchange Carriers 1.3
Retail--Oil & Gas 1.3
Pharmaceuticals 1.2
Home & Office Furnishings, Housewares & Durable Consumer
Products 1.1
Retail--Specialty 1.1
Personal & Miscellaneous Services 1.0
Diversified Manufacturing 0.9
Mining, Steel, Iron & Non-Precious Metals 0.8
Machinery 0.6
Non-Durable Consumer Products 0.6
Business Equipment 0.6
Transportation--Cargo 0.5
Paper & Forest Products 0.5
Broadcasting--Radio 0.4
Textiles & Leather 0.3
Transportation-Rail Manufacturing 0.3
Broadcasting--Television 0.2
Telecommunications--Long Distance 0.2
Broadcasting--Diversified 0.1
Farming & Agriculture 0.1
Transportation--Personal 0.0
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Total Long-Term Investments 98.3%
Short-Term Investments 1.7
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Total Investments 100.0%
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 total investments. 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.
5
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen trust provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
trust'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 trust 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 trust files a
complete schedule of portfolio holdings with the SEC for the trust'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 1-800-SEC-0330. 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.
You may obtain copies of a fund's fiscal quarter filings by contacting
Van Kampen Client Relations at 1-800-847-2424.
6
PROXY VOTING POLICY AND PROCEDURES AND PROXY VOTING RECORD
You may obtain a copy of the Fund's Proxy Voting Policy and Procedures
without charge, upon request, by calling toll free 800-847-2424 or by
visiting our Web site at www.vankampen.com. It is also available on the
Securities and Exchange Commission's Web site at http://www.sec.gov.
You may obtain information regarding how the Fund voted proxies relating
to portfolio securities during the most recent twelve-month period ended
June 30 by visiting our Web site at www.vankampen.com. This information
is also available on the Securities and Exchange Commission's Web site at
http://www.sec.gov.
7
Investment Advisory Agreement Approval
Both the Investment Company Act of 1940 and the terms of the Fund's investment
advisory agreement require that the investment advisory agreement between the
Fund and its investment adviser be approved annually both by a majority of the
Board of Trustees and by a majority of the independent trustees voting
separately.
On May 25, 2005, the Board of Trustees, and the independent trustees voting
separately, determined that the terms of the investment advisory agreement are
fair and reasonable and approved the continuance of the investment advisory
contract as being in the best interests of the Fund and its shareholders. In
making its determination, the Board of Trustees considered materials that were
specifically prepared by the investment adviser at the request of the Board and
Fund counsel, and by an independent provider of investment company data
contracted to assist the Board, relating to the contract review process. The
Board also considered information received periodically about the portfolio,
performance, the investment strategy, portfolio management team and fees and
expenses of the Fund. The Board of Trustees considered the contract over a
period of several months and the non-management trustees held sessions both with
the investment adviser and separate from the investment adviser in reviewing and
considering the contract.
In approving the investment advisory agreement, the Board of Trustees
considered, among other things, the nature, extent and quality of the services
provided by the investment adviser, the performance, fees and expenses of the
Fund compared to other similar funds and other products, the investment
adviser's expenses in providing the services and the profitability of the
investment adviser and its affiliated companies. The Board of Trustees
considered the extent to which any economies of scale experienced by the
investment adviser are shared with the Fund's shareholders, and the propriety of
breakpoints in the Fund's investment advisory fee schedule. The Board of
Trustees considered comparative advisory fees of the Fund and other investment
companies and/or other products at different asset levels, and considered the
trends in the industry. The Board of Trustees evaluated other benefits the
investment adviser and its affiliates derive from their relationship with the
Fund. The Board of Trustees reviewed information about the foregoing factors and
considered changes, if any, in such information since its previous approval. The
Board of Trustees discussed the financial strength of the investment adviser and
its affiliated companies and the capability of the personnel of the investment
adviser, and specifically the strength and background of its portfolio
management personnel. The Board of Trustees reviewed the statutory and
regulatory requirements for approval and disclosure of investment advisory
agreements. The Board of Trustees, including the independent trustees, evaluated
all of the foregoing and does not believe any single factor or group of factors
control or dominate the review process, and, after considering all factors
together, has determined, in the exercise of its business judgment, that
approval
8
of the investment advisory agreement is in the best interests of the Fund and
its shareholders. The following summary provides more detail on certain matters
considered but does not detail all matters considered.
Nature, Extent and Quality of the Services Provided. On a regular basis, the
Board of Trustees considers the roles and responsibilities of the investment
adviser as a whole and for those specific portfolio management, support and
trading functions servicing the Fund. The trustees discuss with the investment
adviser the resources available and used in managing the Fund. The trustees also
discuss certain other services which are provided on a cost-reimbursement basis
by the investment adviser or its affiliates to the Van Kampen funds including
certain accounting, administrative and legal services. The Board has determined
that the nature, extent and quality of the services provided by the investment
adviser support its decision to approve the investment advisory contract.
Performance, Fees and Expenses of the Fund. On a regular basis, the Board of
Trustees reviews the performance, fees and expenses of the Fund compared to its
peers and to appropriate benchmarks. In addition, a performance committee of the
Board spends more focused time on the performance of the Fund and other funds in
the Van Kampen complex, paying specific attention to underperforming funds. The
trustees discuss with the investment adviser the performance goals and the
actual results achieved in managing the Fund. When considering a fund's
performance, the trustees and the investment adviser place emphasis on trends
and longer-term returns (focusing on one-year, three-year and five-year
performance with special attention to three-year performance) and, when a fund's
weighted performance is under the fund's benchmark, they discuss the causes and
where necessary seek to make specific changes to investment strategy or
investment personnel. The Fund discloses more information about its performance
elsewhere in this report. The trustees discuss with the investment adviser the
level of advisory fees for this Fund relative to comparable funds and other
products advised by the adviser and others in the marketplace. The trustees
review not only the advisory fees but other fees and expenses (whether paid to
the adviser, its affiliates or others) and the Fund's overall expense ratio. The
Board has determined that the performance, fees and expenses of the Fund support
its decision to approve the investment advisory contract.
Investment Adviser's Expenses in Providing the Service and Profitability. At
least annually, the trustees review the investment adviser's expenses in
providing services to the Fund and other funds advised by the investment adviser
and the profitability of the investment adviser. These profitability reports are
put together by the investment adviser with the oversight of a special ad hoc
committee of the Board. The trustees discuss with the investment adviser its
revenues and expenses, including among other things, revenues for advisory
services, portfolio management-related expenses, revenue sharing arrangement
costs and allocated expenses both on an aggregate basis and per fund. The
9
Board has determined that the analysis of the investment adviser's expenses and
profitability support its decision to approve the investment advisory contract.
Economies of Scale. On a regular basis, the Board of Trustees considers the size
of the Fund and how that relates to the Fund's expense ratio and particularly
the Fund's advisory fee rate. In conjunction with its review of the investment
adviser's profitability, the trustees discuss with the investment adviser how
more (or less) assets can affect the efficiency or effectiveness of managing the
Fund's portfolio and whether the advisory fee level is appropriate relative to
current asset levels and/or whether the advisory fee structure reflects
economies of scale as asset levels change. The Board has determined that its
review of the actual and potential economies of scale of the Fund support its
decision to approve the investment advisory contract.
Other Benefits of the Relationship. On a regular basis, the Board of Trustees
considers other benefits to the investment adviser and it affiliates derived
from its relationship with the Fund and other funds advised by the investment
adviser. These benefits include, among other things, fees for transfer agency
services provided to the funds, in certain cases research received by the
adviser generated from commission dollars spent on funds' portfolio trading, and
in certain cases distribution or service related fees related to funds' sales.
The trustees review with the investment adviser each of these arrangements and
the reasonableness of its costs relative to the services performed. The Board
has determined that the other benefits received by the investment adviser or its
affiliates support its decision to approve the investment advisory contract.
10
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
VARIABLE RATE** SENIOR LOAN INTERESTS 177.4%
AEROSPACE/DEFENSE 6.1%
$10,653 Alion Science and Technology 5.63 to
Corp., Term Loan............ B1 B+ 5.74% 08/02/09 $ 10,679,379
4,275 AM General, LLC, Term Loan 7.91 to
(b)......................... NR NR 8.11 11/01/11 4,459,359
2,955 Anteon International Corp.,
Term Loan (b)............... Ba2 BB 5.24 12/31/10 2,992,108
5,664 Apptis, Inc., Term Loan..... B2 B+ 6.68 01/05/10 5,702,940
6,715 ARINC, Inc., Term Loan...... Ba3 BB 5.48 03/10/11 6,819,922
5,409 Ceradyne, Inc., Term Loan... Ba3 BB- 5.63 08/18/11 5,483,500
4,372 DRS Technologies, Inc., Term 5.04 to
Loan (b).................... Ba3 BB- 5.65 11/04/10 4,419,005
9,277 DynCorp International, LLC,
Term Loan (b)............... B2 B+ 6.06 02/11/11 9,394,639
2,887 ILC Industries, Inc., Term
Loan........................ NR NR 6.24 08/05/10 2,903,765
10,331 K&F Industries, Inc., Term 5.98 to
Loan........................ B2 B+ 6.15 11/16/12 10,487,510
5,287 SI International, Inc., Term 5.78 to
Loan........................ B1 B+ 5.99 02/09/11 5,379,268
13,150 Spirit AeroSystems, Inc.,
Term Loan................... B1 BB- 5.58 12/31/11 13,388,344
6,909 TransDigm, Inc., Term
Loan........................ B1 B+ 5.80 07/22/10 7,021,065
5,761 Wyle Laboratories, Inc.,
Term Loan................... NR B+ 5.96 01/28/11 5,855,975
------------
94,986,779
------------
AUTOMOTIVE 5.8%
9,701 Accuride Corp., Term Loan 5.50 to
(b)......................... B2 B+ 5.69 01/31/12 9,794,892
3,582 Affinia Group, Inc., Term
Loan (b).................... B2 BB- 6.40 11/30/11 3,601,031
14,021 Federal-Mogul Corp., Term
Loan (c).................... NR NR 7.24 12/09/05 14,055,961
15,384 Federal-Mogul Corp.,
Revolving Credit Agreement
(c)......................... NR NR 7.24 12/09/05 15,441,199
2,373 Heartland Automotive 6.59 to 01/31/10 to
Holdings, Inc., Term Loan... NR NR 10.34 01/31/12 2,372,635
6.42 to
10,474 MetoKote Corp., Term Loan... B2 B+ 6.68 11/27/11 10,539,211
6,452 Polypore, Inc., Term Loan... B1 B 5.74 11/12/11 6,497,196
11,661 Safelite Glass Corp., Term 8.50 to
Loan........................ NR NR 9.00 09/30/07 10,786,284
3,818 Tenneco Automotive, Inc.,
Term Loan................... B1 B+ 5.54 12/12/10 3,871,684
See Notes to Financial Statements 11
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
AUTOMOTIVE (CONTINUED)
$11,841 TRW Automotive, Inc., Term 4.94 to 10/29/10 to
Loan........................ Ba2 BB+ 5.25% 06/30/12 $ 11,945,536
1,808 United Components, Inc.,
Term Loan................... B1 BB- 5.75 06/30/10 1,838,285
------------
90,743,914
------------
BEVERAGE, FOOD & TOBACCO 10.8%
10,918 Acosta Sales Co., Inc., Term 5.27 to
Loan (b).................... NR NR 6.75 08/10/10 11,071,033
13,121 Birds Eye Foods, Inc., Term
Loan (b).................... B1 B+ 6.24 06/30/08 13,298,695
3,707 Commonwealth Brands, Inc.,
Term Loan (b)............... NR NR 6.81 08/28/07 3,776,019
7,633 Constellation Brands, Inc., 4.75 to
Term Loan (b)............... Ba2 BB 5.69 11/30/11 7,760,238
1,700 Culligan International Co.,
Term Loan (b)............... B1 B+ 5.88 09/30/11 1,724,438
6,451 Doane Pet Care Co., Term 7.38 to
Loan........................ B2 B+ 7.43 11/05/09 6,574,901
7,263 Dole Food Co., Inc., Term 4.88 to
Loan (b).................... Ba3 BB 6.75 04/18/12 7,352,528
6,900 Dole Holding Co., Term Loan
(b)......................... B3 B 8.69 07/22/10 7,115,625
20,643 DS Waters Enterprises, LP,
Term Loan................... Caa2 CCC+ 7.99 11/07/09 20,075,321
6,802 Luigino's, Inc., Term 6.38 to
Loan........................ B1 B+ 6.50 04/02/11 6,870,442
8,771 Michael Foods, Inc., Term 5.09 to 11/21/10 to
Loan........................ B1 B+ 7.50 11/20/11 8,938,602
8,237 National Dairy Holdings, LP,
Term Loan................... B1 NR 5.49 03/15/12 8,355,280
3,000 National Distributing Co.,
Inc., Term Loan............. NR NR 9.96 06/22/10 3,007,500
1,985 OSI Foods GMBH & Co. KG,
Term Loan................... NR NR 5.74 09/02/11 2,013,121
4,466 OSI Group, LLC, Term Loan... NR NR 5.74 09/02/11 4,529,523
2,481 OSI-Holland Finance B.V.,
Term Loan................... NR NR 5.74 09/02/11 2,516,402
8,264 Pierre Foods, Inc., Term
Loan........................ B1 B+ 5.69 06/30/10 8,386,241
32,556 Pinnacle Foods, Inc., Term 6.22 to
Loan........................ B1 B+ 6.76 11/25/10 32,927,095
7,000 Sturm Foods, Inc., Term 6.25 to 05/26/11 to
Loan........................ NR NR 10.69 05/26/12 7,071,250
12 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
BEVERAGE, FOOD & TOBACCO (CONTINUED)
$ 1,204 Sunny Delight Beverage Co.,
Term Loan................... B1 B+ 7.54% 08/20/10 $ 1,213,445
3,990 Volume Services America, 6.92 to
Inc., Term Loan............. B2 NR 7.50 10/01/10 4,029,900
------------
168,607,599
------------
BROADCASTING--CABLE 11.5%
5,333 Cebridge Connections, Inc., 6.40 to
Term Loan................... NR NR 8.50 02/23/09 5,352,497
3,300 Century Cable Holdings, LLC,
Term Loan (c)............... NR NR 8.25 06/30/09 3,270,831
61,364 Charter Communications
Operating, LLC, Term Loan 6.68 to 04/27/10 to
(b)......................... B2 B 6.93 04/07/11 61,144,138
9,593 Frontiervision Operating
Partners, LP, Term Loan 7.65 to 09/30/05 to
(c)......................... NR NR 7.78 03/31/06 9,618,980
2,354 Frontiervision Operating
Partners, LP, Revolving
Credit Agreement (c)........ NR NR 7.65 10/31/05 2,359,379
13,373 Hilton Head Communications,
LP, Term Loan (c)........... NR NR 7.50 03/31/08 13,118,331
7,360 Hilton Head Communications,
LP, Revolving Credit
Agreement (c)............... NR NR 6.25 09/30/07 7,185,200
9,245 Insight Midwest Holdings,
LLC, Term Loan.............. Ba3 BB- 5.63 12/31/09 9,374,146
5.35 to
5,000 MCC Iowa, LLC, Term Loan.... Ba3 BB+ 5.51 02/01/14 5,065,909
47,495 Olympus Cable Holdings, LLC, 7.50 to 06/30/10 to
Term Loan (c)............... NR NR 8.25 09/30/10 46,944,437
10,871 Parnassos, LP, Term Loan
(c)......................... NR NR 6.25 06/30/07 10,817,791
4,753 Parnassos, LP, Revolving
Credit Agreement (c)........ NR NR 6.25 06/30/07 4,729,639
------------
178,981,278
------------
BROADCASTING--DIVERSIFIED 0.2%
3,900 Entravision Communications
Corp., Term Loan (b)........ B1 B+ 5.24 02/24/12 3,938,499
------------
BROADCASTING--RADIO 0.8%
8,986 Spanish Broadcasting 5.49 to 06/10/12 to
Systems, Inc., Term Loan.... B1 B+ 7.03 06/10/13 9,118,856
3,491 Susquehanna Media Co., Term 5.25 to
Loan........................ Ba2 BB- 5.49 03/31/12 3,534,891
------------
12,653,747
------------
See Notes to Financial Statements 13
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
BROADCASTING--TELEVISION 0.3%
$ 5,355 NEP Supershooters, LP, Term 7.21 to
Loan........................ B1 B 7.49% 02/03/11 $ 5,457,105
------------
BUILDINGS & REAL ESTATE 6.9%
6,000 AIMCO Properties, LP, Term 5.16 to 11/02/09 to
Loan (b).................... NR NR 5.21 11/09/09 6,085,690
6,667 BioMed Realty, Inc., Term
Loan (b).................... NR NR 5.59 05/30/10 6,675,000
6,256 CB Richard Ellis Services, 5.03 to
Inc., Term Loan (b)......... Ba3 BB- 7.25 03/31/10 6,318,431
1,681 Central Parking Corp., Term
Loan........................ Ba3 BB- 5.49 03/31/10 1,691,006
3,129 Corrections Corp. of 5.25 to
America, Term Loan (b)...... Ba3 BB 5.41 03/31/08 3,180,073
140 Corrections Corp. of
America, Revolving Credit
Agreement (b)............... Ba3 BB 4.91 03/31/06 139,125
1,790 Crescent Real Estate Funding
XII, LP, Term Loan (b)...... NR NR 5.59 01/12/06 1,807,470
51,379 General Growth Properties, 5.49 to 11/12/07 to
LLC, Term Loan.............. Ba2 BB+ 5.59 11/12/08 52,056,223
5.96 to
1,807 GEO Group, Inc., Term Loan.. Ba3 BB- 5.99 07/09/09 1,829,701
6,000 Landsource Communities
Development, LLC, Term
Loan........................ NR NR 5.94 03/31/10 6,031,878
14,500 Macerich Partnership, LP, 4.89 to 04/25/06 to
Term Loan................... NR NR 6.75 04/25/10 14,536,875
2,500 Shea Mountain House, LLC,
Term Loan................... NR NR 5.27 05/11/11 2,509,375
5.31 to 10/31/07 to
4,500 South Edge, LLC, Term Loan.. NR NR 5.56 10/31/09 4,534,584
------------
107,395,431
------------
BUSINESS EQUIPMENT 1.1%
6,366 General Binding Corp., Term 7.64 to
Loan........................ B2 B+ 7.99 01/15/08 6,377,503
4,506 Katun Corp., Term Loan...... NR B+ 7.74 06/30/09 4,517,393
5,491 Verifone, Inc., Term Loan... B1 B+ 5.68 06/30/11 5,533,441
------------
16,428,337
------------
CHEMICALS, PLASTICS & RUBBER 11.9%
1,792 Becker-Underwood, Inc., Term 7.74 to 09/30/11 to
Loan........................ NR NR 10.49 03/31/12 1,791,900
6,500 Brenntag, AG, (Germany),
Term Loan (b)............... B1 BB- 5.88 02/27/12 6,582,550
14 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
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PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
CHEMICALS, PLASTICS & RUBBER (CONTINUED)
$18,629 Celanese, AG, (Germany),
Term Loan (b)............... B1 B+ 5.74% 04/06/11 $ 18,884,827
5.24 to
4,451 Hercules, Inc., Term Loan... Ba1 BB 5.31 10/08/10 4,510,709
19,078 Huntsman International, LLC,
Term Loan................... Ba3 BB- 5.75 12/31/10 19,137,457
37,389 Huntsman, LLC, Term Loan.... B1 BB- 6.40 03/31/10 37,529,019
5.24 to 04/30/10 to
18,457 INVISTA, Term Loan.......... Ba3 BB 5.75 04/29/11 18,761,669
10,937 ISP Chemco, Inc., Term 5.31 to
Loan........................ Ba2 BB+ 5.56 03/27/11 11,073,269
6,830 Kraton Polymers, LLC, Term 5.75 to
Loan........................ B1 B+ 6.44 12/23/10 6,941,052
5.45 to 11/04/09 to
25,913 Nalco Co., Term Loan........ B1 BB- 5.96 11/04/10 26,364,117
10,274 PQ Corp., Term Loan......... B1 B+ 5.50 02/11/12 10,399,473
23,681 Rockwood Specialties Group,
Inc., Term Loan............. B1 B+ 5.93 07/30/12 24,105,292
------------
186,081,334
------------
CONSTRUCTION MATERIAL 2.3%
2,580 Builders FirstSource, Inc., 5.82 to
Term Loan (b)............... B1 BB- 6.19 08/11/11 2,607,949
1,960 Building Materials Holding
Corp., Term Loan (b)........ Ba2 BB- 5.00 06/30/10 1,969,800
7,235 Contech Construction
Products, Inc., Term Loan 5.66 to
(b)......................... Ba3 BB- 7.50 12/07/10 7,339,161
3,731 Interline Brands, Inc., Term
Loan........................ B1 BB 5.74 12/31/10 3,777,891
5.06 to
549 Itron, Inc., Term Loan...... Ba3 BB- 7.50 07/01/11 555,753
2,400 Juno Lighting, Inc., Term 5.71 to
Loan........................ B1 B+ 7.75 11/21/10 2,412,000
1,653 National Waterworks, Inc.,
Term Loan................... B1 B+ 5.99 11/22/09 1,675,791
5,555 New Enterprise Stone & Lime 6.31 to
Co., Inc., Term Loan........ NR NR 8.25 07/30/10 5,583,020
2,310 Professional Paint, Inc., 6.63 to
Term Loan................... NR NR 6.94 09/30/11 2,344,650
973 Sensus Metering Systems, 5.58 to
Inc., Term Loan............. B2 B+ 6.35 12/17/10 984,308
See Notes to Financial Statements 15
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
CONSTRUCTION MATERIAL (CONTINUED)
$ 1,740 Werner Holding Co., Inc., 7.35 to
Term Loan................... B3 B- 7.55% 06/11/09 $ 1,734,596
5,500 Werner Holding Co., Inc.,
Term Loan (g)............... B3 B- 13.25 12/11/09 5,500,000
------------
36,484,919
------------
CONTAINERS, PACKAGING & GLASS 7.9%
4,600 Berry Plastics Corp., Term 5.60 to
Loan (b).................... B1 B+ 5.77 12/02/11 4,677,050
3,125 BWAY Corp., Term Loan (b)... B1 B+ 5.75 06/30/11 3,173,138
1,782 Consolidated Container Co.,
LLC, Term Loan.............. B2 B- 6.69 12/15/08 1,805,389
24,066 Dr. Pepper Bottling Group, 5.34 to
Inc., Term Loan (b)......... B1 NR 5.54 12/19/10 24,433,440
6,829 Graham Packaging Co., LP, 5.94 to 10/07/11 to
Term Loan................... B2 B 7.75 04/07/12 6,946,984
16,911 Graphic Packaging
International Corp., Term 5.76 to
Loan........................ B1 B+ 6.19 06/30/10 17,158,953
406 Graphic Packaging
International Corp.,
Revolving Credit 6.49 to
Agreement................... B1 B+ 6.50 08/08/09 396,169
4,276 Impress Metal Packaging
Holding B.V., (Netherlands),
Term Loan................... NR B+ 6.91 12/31/06 4,286,593
4,257 Kranson Industries, Inc.,
Term Loan................... NR NR 6.24 07/30/11 4,310,213
15,791 Owens-Illinois, Inc., Term 5.12 to 04/01/07 to
Loan........................ B1 BB- 5.27 04/01/08 15,945,084
8,198 Packaging Dynamics, Term 5.49 to 09/29/08 to
Loan........................ NR NR 5.74 09/29/09 8,217,589
6.66 to 03/15/10 to
6,296 Ranpak Corp., Term Loan..... NR NR 9.89 03/17/11 6,359,269
10,125 Smurfit-Stone Container 5.38 to
Corp., Term Loan............ Ba3 BB- 5.56 11/01/11 10,292,350
3,471 Smurfit-Stone Container
Corp., Revolving Credit 5.63 to
Agreement................... Ba3 BB- 7.50 11/01/09 3,424,721
5.32 to
4,254 Solo Cup, Inc., Term Loan... B1 B+ 5.49 02/27/11 4,308,071
7.32 to
5,925 U.S. Can Corp., Term Loan... B3 B 7.65 01/15/10 5,954,625
1,149 Unifrax Corp., Term Loan.... B1 B+ 5.75 03/29/12 1,165,674
------------
122,855,312
------------
16 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
DIVERSIFIED MANUFACTURING 1.5%
$ 2,580 Chart Industries, Inc, Term
Loan........................ NR NR 6.94% 09/15/09 $ 2,586,480
9,100 Euramax International, Inc., 5.88 to 06/29/12 to
Term Loan (b)............... B1 B- 10.55 06/29/13 9,232,000
12,250 Mueller Group, Inc., Term 6.07 to
Loan........................ B2 B+ 6.24 04/23/11 12,356,954
------------
24,175,434
------------
ECOLOGICAL 4.8%
34,997 Allied Waste North America, 5.37 to
Inc., Term Loan (b)......... B1 BB 5.67 01/15/12 35,277,497
6.55 to
6,435 Duratek, Inc., Term Loan.... B1 BB- 6.75 12/16/09 6,446,793
9,191 Envirocare of Utah, LLC, 6.11 to
Term Loan (b)............... NR NR 8.86 04/13/10 9,262,040
3,915 Environmental Systems
Products Holdings, Term 6.82 to 12/12/08 to
Loan........................ Caa1 NR 13.68 12/12/10 4,003,152
4,636 Great Lakes Dredge & Dock 6.60 to
Corp., Term Loan............ B3 CCC+ 7.40 12/22/10 4,624,561
10.25
1,496 Safety-Kleen Corp., Term to
Loan........................ NR NR 10.49 09/15/08 1,522,434
3,943 Synagro Technologies, Inc.,
Term Loan................... B2 BB- 5.68 06/21/12 3,974,893
3,555 Waste Services, Inc., Term 7.77 to
Loan........................ Caa1 B- 8.02 03/31/11 3,606,103
793 Waste Services, Inc.,
Revolving Credit 7.77 to
Agreement................... Caa1 B- 7.98 04/29/09 777,467
5,486 WCA Waste Systems, Inc.,
Term Loan................... B3 B 6.55 04/28/11 5,499,966
------------
74,994,906
------------
ELECTRONICS 7.1%
5,985 AMI Semiconductor, Inc.,
Term Loan (b)............... Ba3 BB- 4.99 04/01/12 6,019,911
8,000 Amkor Technology, Inc., Term
Loan (b).................... B1 B 7.79 10/27/10 8,240,000
4,988 Audio Visual Services Corp.,
Term Loan................... B1 NR 6.23 05/18/11 5,034,258
4,178 Automata, Inc., Term Loan 02/28/03 to
(a) (c) (i)................. NR NR N/A 02/28/04 0
750 DoubleClick, Inc., Term Loan
(b)......................... B2 B 7.38 07/13/12 761,250
849 Fairchild Semiconductor 5.25 to
Corp., Term Loan (b)........ Ba3 BB- 5.44 12/31/10 862,309
See Notes to Financial Statements 17
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
ELECTRONICS (CONTINUED)
$10,868 Knowles Electronics, Inc.,
Term Loan................... B3 NR 8.40% 06/29/07 $ 10,949,056
540 Knowles Electronics, Inc.,
Revolving Credit
Agreement................... B3 NR 7.25 06/30/06 531,900
22,089 ON Semiconductor Corp., Term
Loan........................ B3 B+ 6.50 12/15/11 22,403,084
11,640 Seagate Technology, Inc.,
Term Loan................... Ba1 BB+ 5.50 05/13/07 11,824,296
16,973 Spectrum Brands, Inc., Term 5.27 to
Loan........................ B1 B+ 5.56 02/06/12 17,212,949
10,086 UGS Corp., Term Loan........ B1 B+ 5.49 03/31/12 10,237,541
5,373 Viasystems, Inc., Term
Loan........................ B2 NR 7.64 09/30/09 5,426,730
11,000 Xerox Corp., Term Loan...... NR BB- 5.24 09/30/08 11,096,250
------------
110,599,534
------------
ENTERTAINMENT & LEISURE 11.4%
5,000 24 Hour Fitness Worldwide,
Inc., Term Loan (b)......... B2 B 6.78 06/08/12 5,082,815
2,993 Alliance Atlantis
Communications, Inc., Term 5.21 to
Loan (b).................... Ba2 BB 7.25 12/20/11 3,039,258
3,357 Detroit Red Wings, Inc.,
Term Loan................... NR NR 6.24 08/30/06 3,365,288
8,994 Fender Musical Instruments 5.46 to 03/30/12 to
Corp., Term Loan............ B1 B- 7.71 09/30/12 9,112,406
4,320 Festival Fun Parks, LLC, 8.14 to 06/30/07 to
Term Loan................... NR NR 8.64 12/31/07 4,301,553
50,000 Metro-Goldwyn-Mayer Studios,
Inc., Term Loan............. NR NR 5.74 04/08/12 50,600,000
1,692 Metro-Goldwyn-Mayer Studios,
Inc., Revolving Credit 5.84 to
Agreement................... NR NR 5.99 04/08/10 1,637,308
8,500 New Jersey Basketball, LLC,
Term Loan................... NR NR 7.00 08/16/08 8,500,000
2,132 Panavision, Inc., Term 9.56 to
Loan........................ B3 CCC+ 9.64 01/12/07 2,181,794
7,691 Pure Fishing, Inc., Term 6.48 to 09/30/10 to
Loan........................ B2 B- 9.39 03/31/11 7,786,416
28,822 Regal Cinemas, Inc., Term
Loan........................ Ba3 BB- 5.24 11/10/10 29,164,712
8,698 Six Flags Theme Parks, Inc., 5.97 to
Term Loan................... B1 B- 6.28 06/30/09 8,828,640
330 Six Flags Theme Parks, Inc.,
Revolving Credit 6.09 to
Agreement................... B1 B- 6.24 06/30/08 324,141
18 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
ENTERTAINMENT & LEISURE (CONTINUED)
$ 5,625 Tiger Ballpark, LLC, Term
Loan........................ NR NR 6.13% 12/01/06 $ 5,635,451
9,306 True Temper Sports, Inc., 5.99 to
Term Loan................... B2 B 8.25 03/15/11 9,352,921
5,970 Universal City Development 5.27 to
Partners, LP, Term Loan..... Ba3 BB- 5.60 06/09/11 6,049,598
16,452 WMG Acquisition Corp., Term 5.29 to
Loan........................ B1 B+ 5.64 02/28/11 16,630,783
4,371 Worldwide Sports &
Recreation, Inc., Term
Loan........................ NR NR 7.24 12/31/06 4,381,896
2,263 Yankees Holdings, LP, Term 5.71 to
Loan........................ NR NR 5.83 06/25/07 2,279,829
------------
178,254,809
------------
FARMING & AGRICULTURE 0.1%
1,949 Central Garden & Pet Co., 5.13 to
Term Loan................... Ba2 BB+ 5.24 05/15/09 1,973,148
------------
FINANCE 3.7%
3,872 DCS Business Services, Inc., 6.99 to
Term Loan................... NR NR 8.99 02/04/11 3,881,346
19,913 Fidelity National
Information Solutions, Inc.,
Term Loan................... Ba3 BB 5.10 03/09/13 19,976,499
8,500 Outsourcing Solutions, Inc.,
Term Loan................... NR B- 7.92 09/30/10 8,563,750
6,977 Rent-A-Center, Inc., Term 5.17 to
Loan........................ Ba2 BB+ 5.38 06/30/10 7,060,228
8,114 Risk Management Assurance
Co., Term Loan (a) (c)...... NR NR N/A 12/21/06 7,708,469
10,740 Transfirst Holdings, Inc., 7.50 to 03/31/10 to
Term Loan................... NR NR 11.00 03/31/11 10,803,975
------------
57,994,267
------------
HEALTHCARE 10.8%
7,061 Ameripath, Inc., Term
Loan........................ B2 B+ 6.58 03/27/10 7,122,810
6,198 AMN Healthcare Services,
Inc., Term Loan............. Ba2 BB- 6.49 10/02/08 6,290,587
6,544 Center for Diagnostic
Imaging (CDI), Term Loan.... B2 B+ 6.99 12/31/10 6,510,783
42,311 Community Health Systems,
Inc., Term Loan (b)......... Ba3 BB- 5.07 08/19/11 42,932,481
6,910 Concentra Operating Corp., 5.80 to
Term Loan (b)............... B1 B+ 6.02 06/30/10 7,008,940
998 Diagnostic Imaging Services,
Inc., LLC, Term Loan........ B2 B+ 6.75 05/04/12 992,513
11,019 FHC Health Systems, Inc., 9.33 to 12/18/09 to
Term Loan................... B2 B 12.33 02/09/11 11,110,729
See Notes to Financial Statements 19
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
HEALTHCARE (CONTINUED)
$ 2,328 Healthronics, Inc., Term
Loan........................ Ba3 BB- 5.25% 03/23/11 $ 2,351,617
43,040 LifePoint Hospitals, Inc.,
Term Loan................... Ba3 BB 5.01 04/15/12 43,478,104
4,161 Medcath Holdings Corp., Term
Loan........................ B2 B+ 5.88 06/30/11 4,207,796
2,431 Multiplan, Inc., Term
Loan........................ Ba3 B+ 6.24 03/04/09 2,447,266
3,818 PacifiCare Health Systems, 4.94 to
Inc., Term Loan............. Ba2 BBB- 5.19 12/13/10 3,837,101
25,181 Select Medical Corp., Term 5.04 to
Loan........................ B1 BB- 7.00 02/24/12 25,314,435
1,750 Select Medical Corp.,
Revolving Credit 5.79 to
Agreement................... B1 BB- 6.15 02/24/11 1,741,250
2,970 Sterigenics International,
Inc., Term Loan............. B2 B+ 6.41 06/14/11 3,007,125
------------
168,353,537
------------
HEALTHCARE & BEAUTY 2.7%
7,784 American Safety Razor Co., 5.88 to 02/28/12 to
Term Loan (b)............... Caa1 CCC+ 9.38 08/28/12 7,874,794
144 American Safety Razor Co.,
Revolving Credit
Agreement................... B2 B 8.25 02/28/10 141,120
3,907 CEI Holdings, Inc., Term 6.01 to 12/03/10 to
Loan........................ NR NR 9.93 12/03/11 3,854,592
8,010 Del Laboratories, Inc., Term 5.96 to
Loan (b).................... B2 B 6.48 07/27/11 7,959,689
2,996 Marietta Intermediate 6.60 to 12/17/10 to
Holding Corp., Term Loan.... NR NR 10.60 12/17/11 3,045,895
5,455 MD Beauty, Inc., Term 6.60 to 02/18/12 to
Loan........................ B2 B 9.90 02/18/13 5,543,024
13,104 Prestige Brands Holdings, 5.18 to
Inc., Term Loan............. B1 B+ 7.50 04/06/11 13,246,324
------------
41,665,438
------------
HOME & OFFICE FURNISHINGS, HOUSEWARES & DURABLE
CONSUMER PRODUCTS 2.1%
8.27 to
6,082 Formica Corp., Term Loan.... NR NR 9.75 06/10/10 6,112,054
5.91 to
4,239 Hunter Fan Co., Term Loan... B1 B 6.18 03/24/12 4,223,477
1,380 Imperial Home Decor Group,
Inc., Term Loan (a) (d)
(i)......................... NR NR N/A 04/04/06 34,490
8,717 National Bedding Co., Term 5.38 to
Loan........................ Ba3 BB- 5.74 12/31/10 8,839,376
13,104 Sealy Mattress Co., Term 5.08 to
Loan........................ B1 B+ 5.17 04/06/12 13,234,950
------------
32,444,347
------------
20 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
HOTELS, MOTELS, INNS & GAMING 13.7%
$ 3,433 Alliance Gaming Corp., Term
Loan (b).................... Ba3 BB- 6.77% 09/04/09 $ 3,440,907
4,900 Boyd Gaming Corp., Term Loan 4.88 to
(b)......................... Ba2 BB 4.99 06/30/11 4,954,615
3,144 CNL Hospitality Partners,
LP, Term Loan (b)........... NR NR 5.85 10/13/06 3,151,853
4,773 Global Cash Access, LLC,
Term Loan................... B2 B+ 5.74 03/10/10 4,851,658
7,823 Greektown Casino, LLC, Term
Loan........................ NR NR 6.99 12/31/05 7,866,737
4,938 Green Valley Ranch Gaming,
LLC, Term Loan.............. B1 NR 5.49 12/17/11 5,002,495
4,190 Herbst Gaming, Inc., Term 5.38 to
Loan........................ B1 B+ 5.49 01/31/11 4,243,180
7,500 Hotel del Coronado, Term
Loan........................ NR NR 5.47 02/09/08 7,518,750
5,717 Interstate Operating Co.,
LP, Term Loan............... B2 B 9.00 01/14/08 5,724,127
2,380 Isle of Capri Casinos, Inc., 4.97 to
Term Loan................... Ba2 BB- 5.31 02/04/11 2,408,876
7,187 Kuilima Resort Co., Term 5.60 to 06/29/07 to
Loan........................ NR NR 6.38 09/29/07 7,169,069
4,883 Marina District Finance Co., 5.13 to
Term Loan................... NR NR 5.24 10/20/11 4,926,729
7,339 MGM Mirage, Term Loan....... Ba2 BB 5.13 04/25/10 7,393,413
17,761 MGM Mirage, Revolving Credit 4.95 to
Agreement................... Ba2 BB 5.28 11/22/09 17,598,256
44,375 Planet Hollywood
International, Inc., Term
Loan........................ B3 B- 6.50 08/31/10 44,513,994
108 Planet Hollywood
International, Inc., Term
Loan (g).................... B3 B- 7.50 08/31/10 108,813
11,345 Resorts International Hotel 5.99 to 04/26/12 to
& Casino, Inc., Term Loan... B3 B- 9.23 04/26/13 11,477,725
6,866 Scientific Games Corp., Term
Loan........................ Ba2 BB 5.24 12/23/09 6,957,038
4,200 Seminole Tribe of Florida,
Inc., Term Loan............. NR BB 5.81 09/30/11 4,268,250
17,123 Venetian Casino Resorts,
LLC, Term Loan.............. B1 BB- 5.24 06/15/11 17,355,454
18,925 Wyndham International, Inc., 6.63 to 05/10/11 to
Term Loan................... Caa1 B 11.38 12/10/11 19,296,579
See Notes to Financial Statements 21
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
HOTELS, MOTELS, INNS & GAMING (CONTINUED)
$ 349 Wyndham International, Inc.,
Revolving Credit
Agreement................... Caa1 B 6.63% 05/10/11 $ 347,422
22,338 Wynn Las Vegas, LLC, Term
Loan........................ B2 B+ 5.62 12/14/11 22,608,342
------------
213,184,282
------------
INSURANCE 3.8%
8,910 Alliant Resources Group, 6.88 to
Inc., Term Loan............. B2 B 8.75 08/31/11 8,976,825
4,938 Bristol West Holdings, Inc.,
Term Loan................... Ba1 BB+ 5.24 02/18/11 4,962,188
2,867 CCC Information Services
Group, Inc., Term Loan...... B1 B+ 6.24 08/20/10 2,909,691
11,507 Conseco, Inc., Term Loan
(b)......................... B2 BB- 6.99 06/22/10 11,619,482
7,895 Hilb, Rogal & Hamilton Co., 5.25 to 12/15/09 to
Term Loan................... Ba3 BB 5.75 12/15/11 7,954,740
1,568 Mitchell International,
Inc., Term Loan............. B1 B+ 6.24 08/15/11 1,593,304
3,938 Universal American Financial
Corp., Term Loan............ NR BBB- 5.83 03/31/09 3,947,344
11,822 USI Holdings Corp., Term
Loan........................ B1 BB- 6.18 08/11/08 11,873,654
5,281 Vertafore, Inc., Term 6.04 to 12/22/10 to
Loan........................ NR NR 9.51 12/22/11 5,335,161
------------
59,172,389
------------
MACHINERY 1.2%
5,070 Alliance Laundry Holdings,
LLC, Term Loan (b).......... B1 B 5.59 01/27/12 5,152,388
2,388 Douglas Dynamics, LLC, Term
Loan........................ B1 BB- 5.48 12/16/10 2,417,850
5.25 to 06/30/06 to
1,425 Flowserve Corp., Term Loan.. Ba3 BB- 6.25 06/30/09 1,433,108
6,766 Goodman Global Holdings,
Inc., Term Loan............. B2 B+ 5.88 12/23/11 6,869,608
2,469 United Rentals (North
America), Inc., Term Loan... B1 BB 5.73 02/14/11 2,501,461
------------
18,374,415
------------
MEDICAL PRODUCTS & SERVICES 2.6%
5,373 American Medical Instruments 6.49 to
Holdings, Inc., Term Loan... B2 B+ 6.90 12/09/10 5,408,263
1,657 Colgate Medical, Ltd., 5.48 to
(England), Term Loan........ Ba2 BB- 5.49 12/30/08 1,674,422
4,868 CONMED Corp., Term Loan
(b)......................... Ba3 BB- 5.71 12/15/09 4,927,733
22 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
MEDICAL PRODUCTS & SERVICES (CONTINUED)
$ 5,903 Fisher Scientific
International, Inc., Term
Loan........................ Ba2 BBB 4.99% 08/02/11 $ 5,955,163
7.24 to
12,035 Insight Health, Term Loan... B1 B 7.49 10/17/08 12,084,483
3,548 Kinetics Concepts, Inc.,
Term Loan................... Ba3 BB 5.24 08/11/10 3,589,695
567 Rotech Healthcare, Inc.,
Term Loan................... Ba2 BB 6.49 03/31/08 570,412
3,600 The Cooper Cos., Inc., Term
Loan (b).................... Ba3 BB 5.00 01/06/12 3,624,750
3,204 VWR International, Inc.,
Term Loan................... B2 B+ 6.14 04/07/11 3,246,718
------------
41,081,639
------------
MINING, STEEL, IRON & NON-PRECIOUS METALS 1.5%
5,266 CII Carbon, LLC, Term
Loan........................ NR NR 5.59 06/25/08 5,212,980
15,759 Novelis, Inc., Term Loan.... Ba2 BB- 4.96 01/06/12 15,985,076
2,344 Techs Industries, Inc., Term
Loan........................ NR NR 5.74 01/14/10 2,349,609
------------
23,547,665
------------
NATURAL RESOURCES 5.9%
1,860 Coffeyville Resources, LLC,
Term Loan (b)............... B1 BB- 6.06 06/24/12 1,894,099
21,290 El Paso Corp., Term Loan
(b)......................... B3 B 6.24 11/23/09 21,574,324
2,949 Foundation PA Coal Co., Term 5.38 to
Loan........................ Ba3 BB- 5.66 07/30/11 3,002,589
43,500 Kerr-McGee Corp., Term 5.71 to 05/24/07 to
Loan........................ Ba3 BB+ 5.79 05/24/11 44,210,060
8,059 LYONDELL-CITGO Refining, LP, 5.3 to
Term Loan................... NR NR 5.51 05/21/07 8,184,516
5.89 to
4,763 SemCrude, LP, Term Loan..... Ba2 NR 7.25 03/16/11 4,816,257
8,379 Universal Compression, Inc,
Term Loan................... Ba2 BB 5.24 02/15/12 8,495,518
------------
92,177,363
------------
NON-DURABLE CONSUMER PRODUCTS 1.1%
4,950 Amscan Holdings, Inc., Term 6.13 to
Loan (b).................... B1 B+ 6.56 04/30/12 4,999,500
4,057 Church & Dwight Co., Inc.,
Term Loan (b)............... Ba2 BB 5.24 05/30/11 4,104,807
7,438 JohnsonDiversey, Inc., Term 4.96 to
Loan........................ B1 BB- 5.09 11/03/09 7,514,335
------------
16,618,642
------------
See Notes to Financial Statements 23
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
PAPER & FOREST PRODUCTS 0.9%
$ 2,918 Boise Cascade, LLC, Term
Loan (b).................... Ba3 BB 5.25% 10/29/11 $ 2,965,448
6.25 to
1,000 NewPage Corp., Term Loan.... B1 B 6.49 05/02/11 1,020,000
4,252 White Birch Paper Co., 6.60 to
(Canada), Term Loan......... B2 B+ 6.66 04/06/12 4,315,621
6,000 Xerium Technologies, Inc.,
Term Loan................... B1 BB- 5.49 05/18/12 6,091,878
------------
14,392,947
------------
PERSONAL & MISCELLANEOUS SERVICES 1.9%
2,167 Alderwoods Group, Inc., Term 5.08 to
Loan (b).................... B1 BB- 5.84 09/29/09 2,196,407
8,342 Coinmach Laundry Corp., Term 6.38 to
Loan (b).................... B2 B 6.50 07/25/09 8,450,988
2,460 Global Imaging Systems, 4.75 to
Inc., Term Loan............. Ba3 BB- 4.99 05/10/10 2,479,258
1,875 InfoUSA, Inc., Term Loan.... Ba3 BB 5.99 03/25/09 1,879,687
5,846 Iron Mountain, Inc., Term 5.13 to
Loan........................ B2 BB- 7.00 04/02/11 5,912,633
6,942 Stewart Enterprises, Inc., 4.75 to
Term Loan................... Ba3 BB 5.39 11/19/11 7,007,547
1,140 United Online, Inc., Term 6.56 to
Loan........................ B1 B+ 6.88 12/13/08 1,145,700
------------
29,072,220
------------
PHARMACEUTICALS 2.2%
12,923 MedPointe, Inc., Term 7.72 to 09/30/07 to
Loan........................ B2 B 8.47 09/30/08 13,065,144
1,500 Mylan Laboratories, Inc.,
Term Loan................... Ba1 BBB- 6.75 06/30/10 1,520,625
19,510 Warner Chilcott Holding Co., 5.96 to
Term Loan................... B2 B 6.18 01/18/12 19,741,269
------------
34,327,038
------------
PRINTING & PUBLISHING 12.7%
11,983 Adams Outdoor Advertising, 5.44 to
LP, Term Loan (b)........... B1 B+ 5.64 10/18/12 12,170,244
10,133 American Media Operations,
Inc., Term Loan (b)......... B1 B 6.25 04/01/07 10,270,323
7,798 American Reprographics Co., 5.31 to
Term Loan (b)............... Ba2 BB 5.52 06/18/09 7,855,981
1,200 Ascend Media Holdings, LLC, 5.96 to
Term Loan................... NR NR 6.26 01/31/12 1,204,500
3,000 Canon Communications, LLC,
Term Loan................... B3 B 7.24 05/31/11 3,000,000
714 CanWest Media, Inc.,
(Canada), Term Loan (b)..... Ba2 B+ 5.64 08/15/09 724,411
24 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
PRINTING & PUBLISHING (CONTINUED)
$ 9,925 Cygnus Business Media, Inc.,
Term Loan................... B3 B- 7.51% 07/13/09 $ 9,925,000
5,255 Day International Group,
Inc., Term Loan............. B1 B 6.99 09/16/09 5,303,941
2,915 Dex Media East, LLC, Term 4.75 to
Loan (b).................... Ba2 BB 5.33 05/08/09 2,957,173
13,804 Dex Media West, LLC, Term 4.75 to
Loan (b).................... Ba2 BB 5.33 03/09/10 14,011,959
3,750 Endurance Business Media,
Inc., Term Loan............. B1 B 6.13 03/08/12 3,808,594
1,800 Enterprise NewsMedia, LLC,
Term Loan................... NR NR 6.34 06/30/12 1,823,625
9,500 F&W Publications, Inc., Term 7.09 to
Loan........................ NR NR 7.10 12/31/09 9,559,427
3,279 Freedom Communications, Term
Loan........................ Ba2 BB 4.83 05/01/13 3,319,019
9,079 Haights Cross
Communications, LLC, Term 6.77 to
Loan........................ B3 B- 7.77 08/20/08 9,238,207
8,644 Herald Media, Inc., Term 5.99 to 07/22/11 to
Loan........................ NR NR 8.99 01/22/12 8,725,460
11,445 Journal Register Co., Term 5.00 to
Loan........................ Ba2 BB 5.18 08/12/12 11,545,144
6,899 Lamar Media Corp., Term
Loan........................ Ba2 BB- 5.06 06/30/10 6,984,038
8,570 Liberty Group Operating, 5.62 to
Inc., Term Loan............. B1 B 5.63 02/28/12 8,657,252
2,920 MC Communications, LLC, Term 7.58 to
Loan........................ NR NR 8.06 12/31/10 2,963,800
2,475 MediaNews Group, Inc., Term
Loan........................ NR NR 4.99 12/30/10 2,492,530
9,139 Merrill Communications, LLC, 5.99 to
Term Loan................... B1 B 8.00 07/30/09 9,219,200
8,905 Morris Publishing Group,
LLC, Term Loan.............. Ba1 BB 5.25 03/31/11 9,013,787
7,405 Network Communications, 5.71 to 06/30/11 to
Inc., Term Loan............. NR NR 6.48 12/31/11 7,435,930
5.5 to 06/30/08 to
7,327 Primedia, Inc., Term Loan... B2 B 6.31 06/30/09 7,333,210
850 Primedia, Inc., Revolving 5.50 to
Credit Agreement............ B2 B 5.56 06/30/08 831,883
See Notes to Financial Statements 25
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
PRINTING & PUBLISHING (CONTINUED)
$22,034 R.H. Donnelley, Inc., Term 5.10 to 12/31/09 to
Loan........................ Ba3 BB 5.49% 06/30/11 $ 22,348,400
4,659 Source Media, Inc., Term 5.74 to 11/08/11 to
Loan........................ B2 NR 8.87 08/30/12 4,735,369
------------
197,458,407
------------
RESTAURANTS & FOOD SERVICE 2.3%
6,000 Arby's, LLC, Term Loan...... B1 B+ 5.73 07/25/12 6,081,876
12,300 Burger King Corp., Term Loan
(b)......................... Ba2 B+ 5.19 06/30/12 12,506,283
2,063 Captain D's, LLC, Term
Loan........................ NR NR 7.24 12/27/10 2,095,488
7,182 Carrols Corp., Term Loan
(b)......................... B1 CCC+ 6.00 12/31/10 7,291,233
4,788 Denny's Corp., Term Loan 6.48 to 09/30/09 to
(b)......................... B3 CCC+ 9.00 09/30/10 4,928,688
1,703 Landry's Restaurants, Inc,
Term Loan................... Ba2 BB- 5.24 12/28/10 1,725,386
1,924 Ruth's Chris Steak House,
Inc., Term Loan............. NR NR 6.50 03/11/11 1,928,619
------------
36,557,573
------------
RETAIL--OIL & GAS 2.3%
450 Barjan Products, LLC, Term
Loan........................ NR NR 9.25 04/30/07 449,794
679 Barjan Products, LLC, Term
Loan (g).................... NR NR 11.00 04/30/07 24,460
832 Barjan Products, LLC,
Revolving Credit
Agreement................... NR NR 8.75 04/30/07 831,857
6,979 Getty Petroleum Marketing,
Inc., Term Loan............. B1 BB- 6.49 05/19/10 7,065,823
16,314 The Pantry, Inc., Term
Loan........................ B1 B- 5.74 03/12/11 16,558,406
10,500 Travelcenters of America,
Inc., Term Loan............. B1 BB 5.09 12/01/11 10,632,888
------------
35,563,228
------------
RETAIL--SPECIALTY 2.0%
14,866 Nebraska Book Co., Inc.,
Term Loan................... B2 B 5.88 03/04/11 15,070,753
16,125 Visant Holding Corp., Term 5.75 to 10/04/10 to
Loan........................ B1 B+ 6.00 10/04/11 16,366,332
------------
31,437,085
------------
RETAIL--STORES 2.4%
3,688 Advance Stores Co., Inc., 4.94 to
Term Loan (b)............... Ba2 BB+ 5.25 09/30/10 3,725,247
1,763 Murray's Discount Auto
Stores, Inc., Term Loan..... NR NR 7.84 08/08/09 1,770,040
26 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
RETAIL--STORES (CONTINUED)
5.08 to
$30,969 Rite Aid Corp., Term Loan... B2 B+ 5.13% 08/31/09 $ 31,265,761
216 Rite Aid Corp., Revolving
Credit Agreement............ B2 B+ 7.00 09/20/09 215,396
------------
36,976,444
------------
TELECOMMUNICATIONS--LOCAL EXCHANGE CARRIERS 2.0%
9,800 Fairpoint Communications, 5.44 to
Inc., Term Loan............. B1 BB- 5.56 02/08/12 9,940,875
3,500 Hawaiian Telcom, Inc.., Term
Loan........................ B1 B+ 5.73 10/31/12 3,550,859
1,686 Orius Corp., LLC, Term 7.85 to 01/23/09 to
Loan........................ NR NR 8.36 01/23/10 448,553
1,127 Orius Corp., LLC, Revolving
Credit Agreement............ NR NR 6.00 01/31/06 1,008,312
13,425 Qwest Corp., Term Loan...... Ba3 BB- 8.10 06/30/07 13,885,683
2,900 Valor Telecommunications,
LLC, Term Loan.............. Ba3 BB- 5.49 02/14/12 2,938,582
7,500 WCI Capital Corp., Term Loan
(a) (c) (i)................. NR NR N/A 09/30/07 112,500
1,216 WCI Capital Corp., Debtor In
Possession (a) (c) (i)...... NR NR N/A 12/31/04 50,103
------------
31,935,467
------------
TELECOMMUNICATIONS--LONG DISTANCE 0.3%
4,759 WilTel Communications Group,
LLC, Term Loan.............. B2 NR 6.99 06/30/10 4,824,400
------------
TELECOMMUNICATIONS-WIRELESS 2.3%
2,376 Cellular South, Inc., Term 5.00 to
Loan........................ NR NR 6.75 05/04/11 2,405,700
12,838 Centennial Cellular, Inc., 5.57 to
Term Loan................... B1 B- 5.77 02/09/11 13,047,252
4,000 Nextel Partners, Inc., Term
Loan........................ Ba1 BBB- 4.83 05/31/12 4,034,500
3,582 Spectrasite Communications,
Inc., Term Loan............. Ba3 BBB 4.91 05/19/12 3,619,686
11,910 Western Wireless Corp., Term 6.34 to
Loan........................ B2 B- 8.25 05/31/11 11,951,471
1,167 Western Wireless Corp.,
Revolving Credit
Agreement................... B2 B- 7.50 05/28/10 1,166,667
------------
36,225,276
------------
See Notes to Financial Statements 27
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
----------------------------------------------------------------------------------------------
TEXTILES & LEATHER 0.6%
$ 1,552 Malden Mills Industries,
Inc., Term Loan A........... NR NR 8.00% 10/01/08 $ 121,516
443 Malden Mills Industries,
Inc., Term Loan B (a)....... NR NR N/A 10/01/08 0
8,800 The William Carter Co., Term 5.24 to
Loan........................ B1 BB 5.65 07/14/12 8,934,754
------------
9,056,270
------------
TRANSPORTATION--CARGO 0.9%
2,867 Jacobson Acquisition Co., 7.25 to 04/07/09 to
Term Loan................... NR NR 7.75 04/07/11 2,873,833
6,216 Pacer International, Inc., 5.31 to
Term Loan................... B1 BB 7.25 06/10/10 6,317,250
2,973 Quality Distribution, Inc., 6.41 to
Term Loan................... Caa1 B- 6.49 11/13/09 2,988,090
300 Quality Distribution, Inc.,
Revolving Credit
Agreement................... Caa1 B- 8.75 11/13/08 300,000
1,983 Transport Industries, LP,
Term Loan................... B2 B+ 7.50 06/13/10 1,997,023
------------
14,476,196
------------
TRANSPORTATION--PERSONAL 0.1%
934 Neoplan USA Corp., Revolving
Credit Agreement (d) (i).... NR NR 7.52 06/30/06 933,750
------------
TRANSPORTATION-RAIL MANUFACTURING 0.6%
8,900 Helm Holding Corp., Term 5.84 to 07/08/11 to
Loan........................ NR NR 9.84 07/08/12 9,044,438
------------
UTILITIES 4.3%
15,058 Allegheny Energy, Inc., Term
Loan........................ Ba2 BB 5.18 03/08/11 15,260,519
2,333 Cogentrix Delaware Holdings,
Inc., Term Loan............. Ba2 BB+ 5.24 04/14/12 2,362,803
4,078 Coletto Creek WLE, LP, Term 5.68 to 06/30/11 to
Loan........................ Ba3 BB- 6.52 06/30/12 4,152,056
1,950 Midwest Generation, LLC, 5.39 to
Term Loan................... Ba3 BB- 5.50 04/27/11 1,976,133
7,120 Pike Electric, Inc., Term 5.63 to 07/01/12 to
Loan........................ NR NR 5.69 12/10/12 7,209,000
11,940 Reliant Energy Resources 5.84 to
Corp., Term Loan............ B1 B+ 6.09 04/30/10 12,090,181
23,912 Texas Genco, LLC, Term 5.41 to
Loan........................ Ba2 BB 5.49 12/14/11 24,298,768
------------
67,349,460
------------
TOTAL VARIABLE RATE** SENIOR LOAN INTERESTS 177.4%............................ 2,768,856,268
------------
28 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
DESCRIPTION VALUE
-----------------------------------------------------------------------------------------------
NOTES 1.2%
Barjan Products, LLC ($1,179,714 par, 5.00% coupon, maturing 04/30/07) (g)... $ 0
Builders FirstSource, Inc. ($1,500,000 par, 7.52% coupon, maturing 02/15/12)
(h)........................................................................ 1,522,500
Commonwealth Brands, Inc. ($1,500,000 par, 10.91% coupon, maturing 04/15/08)
(h)........................................................................ 1,569,375
Compression Polymers Corp. ($1,500,000 par, 10.46% coupon, maturing 07/01/12)
(h)........................................................................ 1,515,000
Qwest Corp. ($3,500,000 par, 6.92% coupon, maturing 06/15/13) (h)............ 3,675,000
Rogers Wireless Communications, Inc. ($9,000,000 par, 6.54% coupon, maturing
12/15/10) (Canada) (h)..................................................... 9,416,250
US Unwired, Inc. ($1,200,000 par, 7.66% coupon, maturing 06/15/10) (h)....... 1,251,000
---------------
TOTAL NOTES.................................................................. 18,949,125
---------------
EQUITIES 0.1%
Aladdin Gaming Holdings, LLC (7.84% Ownership Interest, Acquired 09/30/04,
Cost $470,400 (e) (f)...................................................... 254,702
Barjan Products, LLC. (2,201,571 preferred shares, Acquired 06/21/04, Cost
$3,104,488) (e) (f)........................................................ 0
Comdisco Holding Co., Inc. (134 common shares) (e)........................... 2,197
Environmental Systems Products Holdings, Inc. (3,275 common shares, Acquired
06/22/04, Cost $0) (e) (f)................................................. 86,394
IDT Corp. (22,898 common shares) (e)......................................... 297,445
Imperial Home Decor Group, Inc. (512,023 common shares, Acquired 04/26/01,
Cost $522,263) (d) (e) (f) (i)............................................. 0
London Clubs International (Warrants for 141,982 common shares, Acquired
10/15/04, Cost $260,912) (e) (f)........................................... 271,999
Malden Mills Industries (263,436 common shares, Acquired 10/29/03, Cost $0)
(e) (f).................................................................... 0
Malden Mills Industries (860,902 preferred shares, Acquired 10/29/03, Cost
$0) (e) (f)................................................................ 0
Neoplan USA Corp. (2,262 preferred shares, Acquired 09/04/03, Cost
$1,074,521) (d) (e) (f) (i)................................................ 23
Neoplan USA Corp. (8,517 common shares, Acquired 09/04/03, Cost $85) (d) (e)
(f) (i).................................................................... 85
Orius Corp. (315,080 common shares, Acquired 02/03/03, Cost $0) (e) (f)...... 0
Planet Hollywood International, Inc. (Warrants for 89,674 common shares,
Acquired 09/03/04 & 07/22/05, Cost $0) (e) (f)............................. 0
Railworks Corp. (Warrants for 865 common shares, Acquired 02/10/03, Cost $0)
(e) (f).................................................................... 0
Rotech Medical (48,485 common shares, Acquired 06/12/02, Cost $193,940) (e)
(f)........................................................................ 0
Safelite Glass Corp. (421,447 common shares, Acquired 10/20/00, Cost
$1,714,995) (e) (f)........................................................ 0
Safelite Realty (28,448 common shares, Acquired 10/26/00, Cost $0) (e) (f)... 0
See Notes to Financial Statements 29
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
DESCRIPTION VALUE
-----------------------------------------------------------------------------------------------
EQUITIES (CONTINUED)
Targus Group International (Warrants for 28,689 common shares, Acquired
01/30/04, Cost $0) (e) (f)................................................. $ 8,607
---------------
TOTAL EQUITIES 0.1%......................................................... 921,452
---------------
TOTAL LONG-TERM INVESTMENTS 178.7%
(Cost $2,791,577,638)...................................................... 2,788,726,845
---------------
SHORT-TERM INVESTMENTS 3.2%
REPURCHASE AGREEMENT 1.3%
State Street Bank & Trust Corp. ($20,000,000 par collateralized by U.S.
Government obligations in a pooled cash account, interest rate of 3.20%,
dated 07/29/05, to be sold on 08/01/05 at $20,005,334) (b)................. 20,000,000
TIME DEPOSIT 1.9%
State Street Bank & Trust Corp. ($29,429,592 par, 2.65% coupon, dated
07/29/05, to be sold on 08/01/05 at $29,435,274) (b)....................... 29,429,592
---------------
TOTAL SHORT-TERM INVESTMENTS (Cost $49,429,592).............................. 49,429,592
---------------
TOTAL INVESTMENTS 181.9% (Cost $2,841,007,230).............................. 2,838,156,437
BORROWINGS (33.6%).......................................................... (524,000,000)
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (44.9%).................. (700,310,920)
LIABILITIES IN EXCESS OF OTHER ASSETS (3.4%)................................ (53,144,015)
---------------
NET ASSETS APPLICABLE TO COMMON SHARES 100.0%............................... $ 1,560,701,502
===============
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. Bank
loan ratings are unaudited.
Industry percentages are calculated as a percentage of net assets applicable
to common shares.
(a) This Senior Loan interest is non-income producing.
(b) A portion of this security is designated in connection with unfunded
commitments.
(c) This borrower has filed for protection in federal bankruptcy court.
(d) Affiliated company. See Notes to Financial Statements.
(e) Non-income producing security as this stock or warrant currently does not
declare dividends.
30 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JULY 31, 2005 continued
(f) 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 0.04%
of the net assets applicable to common shares of the Trust.
(g) Payment-in-kind security.
(h) Variable rate security. Interest rate shown is that in effect at July 31,
2005.
(i) This borrower is currently in liquidation.
* Senior Loans in the Trust'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 Trust's portfolio may occur. As a
result, the actual remaining maturity of Senior Loans held in the Trust's
portfolio may be substantially less than the stated maturities shown.
Although the Trust is unable to accurately estimate the actual remaining
maturity of individual Senior Loans, the Trust 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 Trust 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 and (iii) the certificate of deposit rate. Senior Loans
are generally considered to be restricted in that the Trust 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 31
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
July 31, 2005
ASSETS:
Investments in Unaffiliated Securities (Cost
$2,837,149,136)........................................... $2,837,188,089
Investments in Affiliated Securities (Cost $3,858,094)...... 968,348
--------------
Total Investments (Cost $2,841,007,230)................... 2,838,156,437
Cash........................................................ 9
Receivables:
Investments Sold.......................................... 14,646,290
Interest and Fees......................................... 13,605,358
Other....................................................... 172,289
--------------
Total Assets............................................ 2,866,580,383
--------------
LIABILITIES:
Payables:
Borrowings................................................ 524,000,000
Investments Purchased..................................... 73,987,707
Investment Advisory Fee................................... 1,985,613
Administrative Fee........................................ 467,203
Distributor and Other Affiliates.......................... 154,708
Income Distributions--Common Shares....................... 110,252
Unfunded Commitments........................................ 2,299,702
Accrued Interest Expense.................................... 1,400,621
Accrued Expenses............................................ 718,393
Trustees' Deferred Compensation and Retirement Plans........ 443,762
--------------
Total Liabilities....................................... 605,567,961
Preferred Shares (including accrued distributions).......... 700,310,920
--------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $1,560,701,502
==============
NET ASSET VALUE PER COMMON SHARE ($1,560,701,502 divided by
180,010,000 shares outstanding)............................. $ 8.67
==============
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
shares authorized, 180,010,000 shares issued and
outstanding).............................................. $ 1,800,100
Paid in Surplus............................................. 1,788,748,292
Accumulated Undistributed Net Investment Income............. 4,136,318
Net Unrealized Depreciation................................. (5,150,495)
Accumulated Net Realized Loss............................... (228,832,713)
--------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $1,560,701,502
==============
PREFERRED SHARES
($.01 par value, authorized 28,000 shares, 28,000 issued
with liquidation preference of $25,000 per share)......... $ 700,000,000
==============
NET ASSETS INCLUDING PREFERRED SHARES....................... $2,260,701,502
==============
32 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statement of Operations
For the Year Ended July 31, 2005
INVESTMENT INCOME:
Interest from Unaffiliated Securities....................... $148,263,450
Interest from Affiliated Securities......................... 64,374
Dividends................................................... 2,239,141
Other....................................................... 4,434,790
------------
Total Income............................................ 155,001,755
------------
EXPENSES:
Investment Advisory Fee..................................... 23,539,821
Administrative Fee.......................................... 5,538,781
Credit Line................................................. 2,168,879
Preferred Share Maintenance................................. 1,822,194
Custody..................................................... 680,651
Legal....................................................... 462,701
Trustees' Fees and Related Expenses......................... 122,163
Other....................................................... 901,769
------------
Total Operating Expenses................................ 35,236,959
------------
Interest Expense........................................ 12,756,584
------------
NET INVESTMENT INCOME....................................... $107,008,212
============
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain from Affiliated Securities.................... $ 2,311
Realized Loss from Unaffiliated Securities.................. (231,048)
------------
Net Realized Loss........................................... (228,737)
------------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... (7,968,504)
------------
End of the Period:
Investments............................................. (2,850,793)
Unfunded Commitments.................................... (2,299,702)
------------
(5,150,495)
------------
Net Unrealized Appreciation During the Period............... 2,818,009
------------
NET REALIZED AND UNREALIZED GAIN............................ $ 2,589,272
============
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $(17,534,408)
============
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
OPERATIONS................................................ $ 92,063,076
============
See Notes to Financial Statements 33
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets
FOR THE FOR THE
YEAR ENDED YEAR ENDED
JULY 31, 2005 JULY 31, 2004
--------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income................................... $ 107,008,212 $ 76,868,483
Net Realized Gain/Loss.................................. (228,737) 21,290,086
Net Unrealized Appreciation During the Period........... 2,818,009 79,993,874
Distributions to Preferred Shareholders:
Net Investment Income................................. (17,534,408) (3,970,944)
-------------- --------------
Change in Net Assets Applicable to Common Shares from
Operations............................................ 92,063,076 174,181,499
Distributions to Common Shareholders:
Net Investment Income................................. (85,468,577) (71,823,861)
-------------- --------------
NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES
FROM INVESTMENT ACTIVITIES............................ 6,594,499 102,357,638
FROM CAPITAL TRANSACTIONS:
Offering Costs on Preferred Shares...................... (1,764) (6,835,194)
-------------- --------------
TOTAL INCREASE IN NET ASSETS APPLICABLE TO COMMON
SHARES................................................ 6,592,735 95,522,444
NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period................................. 1,554,108,767 1,458,586,323
-------------- --------------
End of the Period (Including accumulated undistributed
net investment income of $4,136,318 and $538,614,
respectively)......................................... $1,560,701,502 $1,554,108,767
============== ==============
34 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statement of Cash Flows
For the Year Ended July 31, 2005
CHANGE IN NET ASSETS FROM OPERATIONS........................ $ 92,063,076
------------
Adjustments to Reconcile the Change in Net Assets from
Operations to Net Cash Provided by Operating Activities:
Increase in Investments at Value.......................... (94,166,936)
Increase in Interest and Fees Receivables................. (4,138,108)
Increase in Receivable for Investments Sold............... (9,430,077)
Increase in Other Assets.................................. (8,560)
Increase in Investment Advisory Fee Payable............... 55,477
Increase in Administrative Fee Payable.................... 13,053
Decrease in Distributor and Affiliates Payable............ (149,880)
Increase in Payable for Investments Purchased............. 23,558,105
Change in Unfunded Commitments............................ 2,299,702
Change in Accrued Interest Expense........................ 906,214
Increase in Accrued Expenses.............................. 187,575
Increase in Trustees' Deferred Compensation and Retirement
Plans................................................... 84,029
------------
Total Adjustments....................................... (80,789,406)
------------
NET CASH PROVIDED BY OPERATING ACTIVITIES................... 11,273,670
------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Change in Bank Borrowings................................... 74,000,000
Offering Costs on Preferred Shares.......................... (1,764)
Cash Distributions Paid..................................... (85,271,903)
------------
Net Cash Used for Financing Activities.................. (11,273,667)
------------
NET INCREASE IN CASH........................................ 3
Cash at Beginning of the Period............................. 6
------------
CASH AT THE END OF THE PERIOD............................... $ 9
============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash Paid During the Year for Interest...................... $ 11,850,370
============
See Notes to Financial Statements 35
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL HIGHLIGHTS
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
------------------------------
2005 2004 2003
------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD (a)................ $ 8.63 $ 8.10 $ 7.94
-------- -------- --------
Net Investment Income..................................... .60 .42 .46
Net Realized and Unrealized Gain/Loss..................... .01 .57 .14
Common Share Equivalent of Distributions Paid to Preferred
Shareholders:
Net Investment Income................................... (.10) (.02) -0-
-------- -------- --------
Total from Investment Operations............................ .51 .97 .60
-------- -------- --------
Distributions Paid to Common Shareholders:
Net Investment Income..................................... (.47) (.40) (.44)
Net Realized Gain......................................... -0- -0- -0-
Dilutive impact from the offering of Money Market Cumulative
Preferred Shares.......................................... -0- (.04) -0-
-------- -------- --------
NET ASSET VALUE, END OF THE PERIOD.......................... $ 8.67 $ 8.63 $ 8.10
======== ======== ========
Common Share Market Price at End of the Period.............. $ 8.19 $ 8.84 $ 7.84
Total Return* (b)........................................... -2.03% 18.13% 25.06%
Net Assets Applicable to Common Shares at End of the Period
(In millions)............................................. $1,560.7 $1,554.1 $1,458.6
Ratios to Average Net Assets applicable to Common Shares
excluding Borrowings:
Operating Expense* (f).................................... 2.26% 1.91% 1.59%
Interest Expense (f)...................................... .82% .31% .62%
Gross Expense* (f)........................................ 3.08% 2.22% 2.21%
Net Investment Income* (f)................................ 6.87% 5.06% 5.98%
Net Investment Income* (g)................................ 5.75% 4.80% N/A
Portfolio Turnover (c)...................................... 94% 84% 78%
SUPPLEMENTAL RATIOS:
Ratios to Average Net Assets including Preferred Shares and
Borrowings:
Operating Expense* (f).................................... 1.27% 1.30% 1.19%
Interest Expense (f)...................................... .46% .21% .46%
Gross Expense* (f)........................................ 1.73% 1.51% 1.65%
Net Investment Income* (f)................................ 3.86% 3.44% 4.47%
Net Investment Income* (g)................................ 3.23% 3.26% N/A
SENIOR INDEBTEDNESS:
Total Preferred Shares Outstanding...................... 28,000 28,000 N/A
Asset Coverage Per Preferred Share (h).................. $ 80,750 $ 80,509 N/A
Involuntary Liquidating Preference Per Preferred
Share................................................. $ 25,000 $ 25,000 N/A
Average Market Value Per Preferred Share................ $ 25,000 $ 25,000 N/A
Total Borrowing Outstanding (In thousands).............. $524,000 $450,000 $401,000
Asset Coverage Per $1,000 Unit of Senior Indebtedness
(d)................................................... 5,315 6,009 4,637
* If certain expenses had not been voluntarily assumed by Van Kampen, total
return would have been lower and the Ratio of Operating Expenses to Average
Net Assets, Ratio of Gross Expenses to Average Net Assets and the Ratio of
Net Investment Income to Average Net Assets would have been 1.21%, 1.49% and
6.90% for the period ended July 31, 1998.
** Non-Annualized
(a)Net asset value on June 24, 1998 of $10.00 is adjusted for common share
offering costs of $.013.
(b)Total return based on common share market price assumes an investment at the
common share market price at the beginning of the period indicated,
reinvestment of all distributions for the period in accordance with the
Trust's dividend reinvestment plan, and sale of all shares at the closing
common share market price at the end of the period indicated.
(c)Calculation includes the proceeds from principal repayments and sales of
senior loan interests.
(d)Calculated by subtracting the Trust's total liabilities (not including the
Borrowings) from the Trust's total assets and dividing by the total number of
senior indebtedness units, where one unit equals $1,000 of senior
indebtedness.
36
JUNE 24, 1998
(COMMENCEMENT
YEAR ENDED JULY 31, OF OPERATIONS)
---------------------------------------------- TO
2002 (E) 2001 2000 1999 JULY 31, 1998
---------------------------------------------------------------
$ 8.51 $ 9.65 $ 10.08 $ 10.07 $ 9.99
-------- -------- -------- -------- --------
.49 .79 .81 .77 .07
(.55) (1.10) (.42) -0- .01
-0- -0- -0- -0- -0-
-------- -------- -------- -------- --------
(.06) (.31) .39 .77 .08
-------- -------- -------- -------- --------
(.51) (.83) (.81) (.76) -0-
-0- -0- (.01) -0- -0-
-0- -0- -0- -0- -0-
-------- -------- -------- -------- --------
$ 7.94 $ 8.51 $ 9.65 $ 10.08 $ 10.07
======== ======== ======== ======== ========
$ 6.67 $ 7.79 $ 8.75 $ 9.5625 $10.0625
-8.05% -1.42% .61% 2.98% .63%**
$1,430.0 $1,532.7 $1,736.5 $1,815.1 $1,812.1
1.48% 1.63% 1.75% 1.66% 1.18%
.53% 2.15% 2.49% 2.37% .28%
2.01% 3.78% 4.24% 4.03% 1.46%
6.02% 8.90% 8.19% 7.72% 6.94%
N/A N/A N/A N/A N/A
65% 55% 57% 28% 3%**
1.22% 1.20% 1.24% 1.18% N/A
.44% 1.58% 1.77% 1.67% N/A
1.66% 2.78% 3.01% 2.85% N/A
4.95% 6.55% 5.83% 5.46% N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
$370,159 $375,000 $700,000 $800,000 $400,000
4,863 5,087 3,481 3,269 5,530
(e)As required, effective August 1, 2001, the Trust has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premium on fixed income securities. The effect of this change for
the year ended July 31, 2002 was to decrease the ratio of net investment
income to average net assets applicable to common shares by .01%. Net
investment income per share and net realized and unrealized gains and losses
per share were unaffected by the adjustments. Per share, ratios and
supplemental data for the periods prior to July 31, 2002 have not been
restated to reflect this change in presentation.
(f)Ratios do not reflect the effect of distributions to preferred shareholders.
(g)Ratios reflect the effect of distributions to preferred shareholders.
(h)Calculated by subtracting the Trust's total liabilities (not including the
preferred shares) from the Trust's total assets and dividing this by the
number of preferred shares outstanding.
N/A=Not Applicable
See Notes to Financial Statements 37
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Senior Income Trust (the "Trust") is registered as a non-diversified,
closed-end management investment company under the Investment Company Act of
1940 (the "1940 Act"), as amended. The Trust's investment objective is to seek
to provide a high level of current income, consistent with preservation of
capital. The Trust seeks to achieve its objective by investing primarily in a
portfolio of interests in floating or variable rate senior loans to
corporations, partnerships and other entities which operate in a variety of
industries and geographical regions. The Trust borrows money for investment
purposes which will create the opportunity for enhanced return, but also should
be considered a speculative technique and may increase the Trust's volatility.
The Trust commenced investment operations on June 24, 1998.
The following is a summary of significant accounting policies consistently
followed by the Trust 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 Trust's Senior Loans are valued by the Trust following
valuation guidelines established and periodically reviewed by the Trust'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, interest rate
redetermination period and maturity), the credit worthiness of the Borrower, the
current interest rate, the period until next interest rate redetermination and
the maturity of such Senior Loan. 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 Trust's portfolio. The fair value of Senior Loans are reviewed and
approved by the Trust's Valuation Committee and the Board of Trustees.
Equity securities are valued on the basis of prices furnished by pricing
services or 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 Trust may invest in repurchase agreements, which are short-term
investments in which the Trust 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 Trust will make payment for such securities only upon
38
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005 continued
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 Trust.
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 received 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.
D. FEDERAL INCOME TAXES It is the Trust'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 Trust 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, 2005, the Trust had an accumulated capital loss carryforward
for tax purposes of $211,408,105 which will expire according to the following
schedule.
AMOUNT EXPIRATION
$ 4,851,995................................................ July 31, 2009
122,716,095................................................ July 31, 2010
52,014,750................................................ July 31, 2011
29,634,358................................................ July 31, 2012
2,190,907................................................ July 31, 2013
At July 31, 2005, the cost and related gross unrealized appreciation and
depreciation are as follows:
Cost of investments for tax purposes........................ $2,850,742,455
==============
Gross tax unrealized appreciation........................... $ 18,716,470
Gross tax unrealized depreciation........................... (31,302,488)
--------------
Net tax unrealized depreciation on investments.............. $ (12,586,018)
==============
E. DISTRIBUTION OF INCOME AND GAINS The Trust intends to declare and pay monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are to be distributed at least annually to common shareholders.
Distributions from net realized gains for book purposes may include short term
capital gains, which are included as ordinary income for tax purposes.
39
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005 continued
The tax character of distributions paid for the years ended July 31, 2005
and 2004 was as follows:
2005 2004
Distributions paid from:
Ordinary income........................................... $102,806,311 $75,570,307
Long-term capital gain.................................... -0- -0-
------------ -----------
$102,806,311 $75,570,307
============ ===========
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under accounting principles generally accepted in the
United States of America and federal income tax purposes, permanent differences
between book and tax basis reporting have been identified and appropriately
reclassified on the Statement of Assets and Liabilities. A permanent difference
related to book to tax amortization differences totaling $407,523 has been
reclassified from accumulated undistributed net investment income to accumulated
net realized loss.
As of July 31, 2005, the components of distributable earnings on a tax basis
were as follows:
Undistributed ordinary income............................... $5,272,503
Net realized gains and losses may differ for financial and tax reporting
purposes primarily as a result of the deferral of losses resulting from wash
sale transactions, other losses that were recognized for book purposes but not
tax purposes at the end of the fiscal year and post October losses which are not
realized for tax purposes until the first day of the following fiscal year.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Trust for an annual fee of .85%
of the average daily managed assets. Managed assets are defined as the gross
asset value of the Trust minus the sum of accrued liabilities, other than the
aggregate amount of borrowings undertaken by the Trust. In addition, the Trust
will pay a monthly administrative fee to Van Kampen Investments Inc., the
Trust's Administrator, at an annual rate of .20% of the average daily managed
assets of the Trust. 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 Variable Rate Senior Loans in the Trust's portfolio and
providing certain services to the holders of the Trust's securities.
For the year ended July 31, 2005, the Trust recognized expenses of
approximately $105,300 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust
is a partner of such firm and he and his law firm provide legal services as
legal counsel to the Trust.
Under separate Legal Services and Chief Compliance Officer ("CCO")
Employment agreements, the Adviser provides legal services and the CCO provides
compliance services to the Trust. The costs of these services are allocated to
each trust. For the year ended July 31,
40
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005 continued
2005, the Trust recognized expenses of approximately $101,800, representing Van
Kampen Investment Inc.'s or its affiliates' (collectively "Van Kampen") cost of
providing legal services to the Trust, as well as, the salary, benefits and
related costs of the CCO and related support staff paid by Van Kampen. Services
provided pursuant to the Legal Services agreement are reported as part of
"Legal" expenses on the Statement of Operations. Services provided pursuant to
the CCO Employment agreement are reported as part of "Other" expenses on the
Statement of Operations.
Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.
The Trust 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 for a ten-year period
and are based upon each trustee's years of service to the Trust. The maximum
annual benefit per trustee under the plan is $2,500.
During the period, the Trust owned shares of the following affiliated
companies. Affiliated companies are defined by the 1940 Act, as amended, as
those companies in which a fund holds 5% or more of the outstanding voting
securities.
DIVIDEND/
PAR/ INTEREST MARKET VALUE
NAME SHARES * INCOME 7/31/05 COST
Imperial Home Decor Group, Inc., Term
Loan................................... $1,379,619 $ -0- $ 34,490 $1,327,475
Imperial Home Decor Group, Inc., Common
Stock.................................. 512,023 -0- -0- 522,263
Neoplan USA Corp., Revolving Credit
Agreement.............................. $ 933,750 64,374 933,750 933,750
Neoplan USA Corp., Common Stock.......... 8,517 -0- 85 85
Neoplan USA Corp., Preferred Stock C..... 532 -0- 6 532
Neoplan USA Corp., Preferred Stock D..... 1,730 -0- 17 1,073,989
--------- ------------ ----------
$64,374 $968,348 $3,858,094
========= ============ ==========
* Shares were acquired through the restructuring of Senior Loan interests.
Affiliate transactions during the year ended July 31, 2005 were as follows:
REALIZED
PAR AS OF GROSS GROSS PAR AS OF GAIN/
NAME 7/31/04 ADDITIONS REDUCTIONS 7/31/05 (LOSS)
Imperial Home Decor Group, Inc.,
Term Loan..................... $1,422,288 $ -0- $42,669 $1,379,619 $2,311
Neoplan USA Corp., Revolving
Credit Agreement.............. 911,250 56,250 33,750 933,750 -0-
--------
$2,311
========
41
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005 continued
3. INVESTMENT TRANSACTIONS
During the period, the costs of purchases and proceeds from investments sold and
repaid, excluding short-term investments, were $2,688,239,856 and
$2,578,599,825, respectively.
4. COMMITMENTS
Pursuant to the terms of certain of the Senior Loan agreements, the Trust had
unfunded loan commitments of approximately $179,349,844 as of July 31, 2005. The
Trust intends to reserve against such contingent obligations by designating
cash, liquid securities and liquid Senior Loans as a reserve. The unrealized
depreciation on these commitments of $2,299,702 as of July 31, 2005 is reported
as "Unfunded Commitments" on the Statement of Assets and Liabilities.
5. SENIOR LOAN PARTICIPATION COMMITMENTS
The Trust invests primarily in participations, assignments, or acts as a party
to the primary lending syndicate of a Variable Rate Senior Loan interest to
United States and foreign corporations, partnerships, and other entities. When
the Trust purchases a participation of a Senior Loan interest, the Trust
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 Trust assumes the credit risk of the borrower, selling participant or other
persons interpositioned between the Trust and the borrower.
At July 31, 2005, the Trust had no selling participants with respect to
interests in Senior Loans purchased by the Trust on a participation basis.
6. BORROWINGS
The Trust may utilize financial leverage to the maximum extent allowable under
the 1940 Act, as amended. Under the 1940 Act, as amended, a fund generally may
not (i) borrow money greater than 33 1/3% of the fund's total assets or (ii)
issue preferred shares greater than 50% of the fund's total assets. In using a
combination of borrowing money and issuing preferred shares, the maximum
allowable leverage is somewhere between 33 1/3% and 50% (but in no event more
that 50%) of the Fund's total assets based on the relative amounts borrowed or
preferred shares issued.
The Trust has entered into a $700 million revolving credit and security
agreement. Annual commitment fees of .13% are charged on the unused portion of
the credit line. This revolving credit agreement is secured by the assets of the
Trust. For the year ended July 31, 2005, the average daily balance of borrowings
under the revolving credit agreement was $512,060,274 with a weighted average
interest rate of 2.46%.
7. PREFERRED SHARES ISSUANCE
As of February 20, 2004, the Trust issued 5,600 shares each of Series M, Series
T, Series W, Series TH and Series F Auction Preferred Shares ("APS"), $.01 Par
Value, $25,000 liquidation preference, for a total issuance of $700 million.
Dividends are cumulative and the dividend rates are generally reset every seven
days through an auction process. The average rate in effect on July 31, 2005 was
3.198%. During the year ended July 31, 2005, the rates ranged from 1.490% to
3.610%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of the "Preferred Share
Maintenance" expense in the Statement of Operations.
42
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JULY 31, 2005 continued
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
8. INDEMNIFICATIONS
The Trust enters into contracts that contain a variety of indemnifications. The
Trust's maximum exposure under these arrangements is unknown. However, the Trust
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.
43
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Trustees of Van Kampen Senior >Income Trust
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Van Kampen Senior Income Trust (the "Trust"),
as of July 31, 2005, the related statements of operations and cash flows for the
year then ended, the statements of changes in net assets for each of the two
years then ended, and the financial highlights for each of the six years in the
period then ended. These financial statements and financial highlights are the
responsibility of the Trust's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits. The Trust's financial highlights for the period ended prior to July 31,
2000 were audited by other auditors whose report, dated September 14, 1999,
expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
The Trust is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audits include consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Trust's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of July 31, 2005 by correspondence with the Trust's
custodian, brokers, and selling or agent banks; where replies were not received,
we performed other auditing procedures. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of Van
Kampen Senior Income Trust as of July 31, 2005, the results of its operations
and its cash flows for the year then ended, the changes in its net assets for
each of the two years in the period then ended, and the financial highlights for
each of the six years in the period then ended, in conformity with accounting
principles generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
Chicago, Illinois
September 15, 2005
44
VAN KAMPEN SENIOR INCOME TRUST
DIVIDEND REINVESTMENT PLAN
The Trust offers a Dividend Reinvestment Plan (the "Plan") pursuant to which
Common Shareholders who are participants in the Plan may have all distributions
of dividends and capital gains automatically reinvested in Common Shares of the
Trust. Common Shareholders who elect not to participate in the Plan will receive
all distributions of dividends and capital gains in cash paid by check mailed
directly to the Common Shareholder by the Trust's dividend disbursing agent.
HOW THE PLAN WORKS
EquiServe Trust Company, N.A., as your Plan Agent, serves as agent for the
Common Shareholders in administering the Plan. After the Trust declares a
dividend or determines to make a capital gains distribution, the Plan Agent
will, as agent for the participants, receive the cash payment and use it to buy
Common Shares in the open market, on the New York Stock Exchange or elsewhere,
for the participants' accounts. The Trust will not issue any new Common Shares
in connection with the Plan. All reinvestments are in full and fractional Common
Shares, carried to three decimal places.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or capital gains distribution paid subsequent to written
notice of the change sent to all Common Shareholders of the Trust at least 90
days before the record date for the dividend or distribution. The Plan also may
be amended or terminated by the Plan Agent, with the written consent of the
Trust, by providing at least 90 days written notice to all Participants in the
Plan.
COSTS OF THE PLAN
The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. No other charges will be made to participants for reinvesting
dividends or capital gains distributions, except for certain brokerage
commissions, as described above.
TAX IMPLICATIONS
You will receive tax information annually for your personal records and to
help you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income tax
which may be payable on dividends or distributions.
45
VAN KAMPEN SENIOR INCOME TRUST
DIVIDEND REINVESTMENT PLAN continued
RIGHT TO WITHDRAW
You may withdraw from the Plan at any time by calling 1-800-341-2929 or by
writing EquiServe Trust Company, N.A. If you withdraw, you will receive, without
charge, a share certificate issued in your name for all full Common Shares
credited to your account under the Plan, and a cash payment will be made for any
fractional Common Share credited to your account under the Plan. You may again
elect to participate in the Plan at any time by calling 1-800-341-2929 or
writing to the Trust at:
2800 Post Oak Blvd.
Attn: Closed-End Funds
Houston, TX 77056
46
VAN KAMPEN SENIOR INCOME TRUST
BOARD OF TRUSTEES, OFFICERS 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*
OFFICERS
MITCHELL M. MERIN
President and Chief Executive Officer
RONALD E. ROBISON
Executive Vice President and
Principal Executive Officer
JOSEPH J. MCALINDEN
Executive Vice President and
Chief Investment Officer
AMY R. DOBERMAN
Vice President
STEFANIE V. CHANG
Vice President and Secretary
JOHN L. SULLIVAN
Chief Compliance Officer
PHILLIP G. GOFF
Chief Financial Officer and Treasurer
HOWARD TIFFEN
Vice President
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, New York 10020
CUSTODIAN
STATE STREET BANK AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02110
TRANSFER AGENT
EQUISERVE TRUST COMPANY, N.A.
c/o Computershare Investor Services
P.O. Box 43010
Providence, Rhode Island 02940-3010
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
DELOITTE & TOUCHE LLP
111 South Wacker Drive
Chicago, Illinois 60606-4301
* "Interested persons" of the Trust, as defined in the Investment Company Act
of 1940, as amended.
47
VAN KAMPEN SENIOR INCOME TRUST
RESULTS OF SHAREHOLDER VOTES
The Annual Meeting of Shareholders of the Trust was held on July 25, 2005, where
shareholders voted on the election of trustees.
With regard to the election of the following trustees by the common shareholders
of the Trust:
# OF SHARES
--------------------------------
IN FAVOR WITHHELD
------------------------------------------------------------------------------------------
David C. Arch........................................... 162,823,895 3,219,317
Howard J Kerr........................................... 162,772,643 3,270,569
The other trustees of the Trust whose terms did not expire in 2005 are Rod
Dammeyer, Richard F. Powers, III, Hugo F. Sonnenschein, and Wayne W. Whalen.
48
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEES AND OFFICERS
The business and affairs of the Trust are managed under the direction of the
Trust's Board of Trustees and the Trust's officers appointed by the Board of
Trustees. The tables below list the trustees and executive officers of the Trust
and their principal occupations during the last five years, other directorships
held by trustees and their affiliations, if any, with Van Kampen Investments
Inc. ("Van Kampen Investments"), Van Kampen Asset Management (the "Adviser"),
Van Kampen Funds Inc. (the "Distributor"), Van Kampen Advisors Inc., Van Kampen
Exchange Corp. and Van Kampen Investor Services Inc. ("Investor Services"). The
term "Fund Complex" includes each of the investment companies advised by the
Adviser as of the date of this Annual Report. Trustees of the Funds generally
serve three year terms or until their successors are duly elected and qualified.
Officers are annually elected by the trustees.
INDEPENDENT TRUSTEES
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
David C. Arch (60) Trustee Trustee Chairman and Chief 79 Trustee/Director/Managing
Blistex Inc. since 1998 Executive Officer of General Partner of funds
1800 Swift Drive Blistex Inc., a consumer in the Fund Complex.
Oak Brook, IL 60523 health care products
manufacturer. Director of
the Heartland Alliance, a
nonprofit organization
serving human needs based
in Chicago. Director of
St. Vincent de Paul
Center, a Chicago based
day care facility serving
the children of low
income families. Board
member of the Illinois
Manufacturers'
Association.
49
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEE AND OFfiCERS INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Rod Dammeyer (64) Trustee Trustee President of CAC, L.L.C., 79 Trustee/Director/Managing
CAC, L.L.C. since 1998 a private company General Partner of funds
4350 LaJolla Village Drive offering capital in the Fund Complex.
Suite 980 investment and management Director of Stericycle,
San Diego, CA 92122-6223 advisory services. Prior Inc., Ventana Medical
to February 2001, Vice Systems, Inc., and GATX
Chairman and Director of Corporation, and Trustee
Anixter International, of The Scripps Research
Inc., a global Institute. Prior to
distributor of wire, January 2005, Trustee of
cable and communications the University of Chicago
connectivity products. Hospitals and Health
Prior to July 2000, Systems. Prior to April
Managing Partner of 2004, Director of
Equity Group Corporate TheraSense, Inc. Prior to
Investment (EGI), a January 2004, Director of
company that makes TeleTech Holdings Inc.
private investments in and Arris Group, Inc.
other companies. Prior to May 2002,
Director of Peregrine
Systems Inc. Prior to
February 2001, Director
of IMC Global Inc. Prior
to July 2000, Director of
Allied Riser
Communications Corp.,
Matria Healthcare Inc.,
Transmedia Networks,
Inc., CNA Surety, Corp.
and Grupo Azcarero Mexico
(GAM).
50
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEE AND OFfiCERS INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Howard J Kerr (69) Trustee Trustee Prior to 1998, President 79 Trustee/Director/Managing
14 Huron Trace since 1998 and Chief Executive General Partner of funds
Galena, IL 61036 Officer of Pocklington in the Fund Complex.
Corporation, Inc., an Director of the Lake
investment holding Forest Bank & Trust.
company. Director of the
Marrow Foundation.
Hugo F. Sonnenschein (64) Trustee Trustee President Emeritus and 79 Trustee/Director/Managing
1126 E. 59th Street since 1998 Honorary Trustee of the General Partner of funds
Chicago, IL 60637 University of Chicago and in the Fund Complex.
the Adam Smith Director of Winston
Distinguished Service Laboratories, Inc.
Professor in the
Department of Economics
at the University of
Chicago. Prior to July
2000, President of the
University of Chicago.
Trustee of the University
of Rochester and a member
of its investment
committee. Member of the
National Academy of
Sciences, the American
Philosophical Society and
a fellow of the American
Academy of Arts and
Sciences.
51
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEE AND OFFICERS INFORMATION continued
INTERESTED TRUSTEES*
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Richard F. Powers, III* (59) Trustee Trustee Advisory Director of 79 Trustee/Director/Managing
1221 Avenue of the Americas since 1999 Morgan Stanley. Prior to General Partner of funds
New York, NY 10020 December 2002, Chairman, in the Fund Complex.
Director, President,
Chief Executive Officer
and Managing Director of
Van Kampen Investments
and its investment
advisory, distribution
and other subsidiaries.
Prior to December 2002,
President and Chief
Executive Officer of
funds in the Fund
Complex. Prior to May
1998, Executive Vice
President and Director of
Marketing at Morgan
Stanley and Director of
Dean Witter, Discover &
Co. and Dean Witter
Realty. Prior to 1996,
Director of Dean Witter
Reynolds Inc.
Wayne W. Whalen* (67) Trustee Trustee Partner in the law firm 79 Trustee/Director/Managing
333 West Wacker Drive since 1998 of Skadden, Arps, Slate, General Partner of funds
Chicago, IL 60606 Meagher & Flom LLP, legal in the Fund Complex.
counsel to funds in the Director of the Abraham
Fund Complex. Lincoln Presidential
Library Foundation.
* Such trustee is an "interested person" (within the meaning of Section
2(a)(19) of the 1940 Act). Mr. Powers is an interested person of funds in
the Fund Complex and the Adviser by reason of his current or former
positions with Morgan Stanley or its affiliates. Mr. Whalen is an interested
person of certain funds in the Fund Complex by reason of he and his firm
currently providing legal services as legal counsel to such funds in the
Fund Complex.
52
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEE AND OFFICERS INFORMATION continued
OFFICERS
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER TRUST SERVED DURING PAST 5 YEARS
Ronald E. Robison (66) Executive Vice Officer Executive Vice President and Principal Executive Officer of
1221 Avenue of the Americas President and since 2003 funds in the Fund Complex. Chief Executive Officer and
New York, NY 10020 Principal Chairman of Investor Services. Managing Director of Morgan
Executive Stanley. Chief Administrative Officer, Managing Director and
Officer Director of Morgan Stanley Investment Advisors Inc., Morgan
Stanley Services Company Inc. and Managing Director and
Director of Morgan Stanley Distributors Inc. Chief Executive
Officer and Director of Morgan Stanley Trust. Executive Vice
President and Principal Executive Officer of the
Institutional and Retail Morgan Stanley Funds; Director of
Morgan Stanley SICAV; previously Chief Global Operations
Officer and Managing Director of Morgan Stanley Investment
Management Inc.
Joseph J. McAlinden (62) Executive Vice Officer Managing Director and Chief Investment Officer of Morgan
1221 Avenue of the Americas President and since 2002 Stanley Investment Advisors Inc., and Morgan Stanley
New York, NY 10020 Chief Investment Investment Management Inc. and Director of Morgan Stanley
Officer Trust for over 5 years. Executive Vice President and Chief
Investment Officer of funds in the Fund Complex. Managing
Director and Chief Investment Officer of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc. since
December 2002.
Amy R. Doberman (43) Vice President Officer Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas since 2004 Management; Managing Director of Morgan Stanley Investment
New York, NY 10020 Management, Inc., Morgan Stanley Investment Advisers Inc.
and the Adviser. Vice President of the Morgan Stanley
Institutional and Retail Funds since July 2004 and Vice
President of funds in the Fund Complex as of August 2004.
Previously, Managing Director and General Counsel of
Americas, UBS Global Asset Management from July 2000 to July
2004 and General Counsel of Aeltus Investment Management,
Inc. from January 1997 to July 2000.
Stefanie V. Chang (38) Vice President Officer Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas and Secretary since 2003 Vice President and Secretary of funds in the Fund Complex.
New York, NY 10020
53
VAN KAMPEN SENIOR INCOME TRUST
TRUSTEE AND OFfiCERS INFORMATION continued
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER TRUST SERVED DURING PAST 5 YEARS
John L. Sullivan (50) Chief Compliance Officer Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza Officer since 1998 August 2004. Prior to August 2004, Director and Managing
Oakbrook Terrace, IL 60181 Director of Van Kampen Investments, the Adviser, Van Kampen
Advisors Inc. and certain other subsidiaries of Van Kampen
Investments, Vice President, Chief Financial Officer and
Treasurer of funds in the Fund Complex and head of Fund
Accounting for Morgan Stanley Investment Management. Prior
to December 2002, Executive Director of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc.
Phillip G. Goff (41) Chief Financial Officer Executive Director of Morgan Stanley Investment Management
1 Parkview Plaza Officer and since 2005 since June 2005. Chief Financial Officer and Treasurer of
Oakbrook Terrace, IL 60181 Treasurer funds in the Fund Complex since August 2005. Prior to June
2005, Vice President and Chief Financial Officer of
Enterprise Capital Management, Inc., an investment holding
company.
Howard Tiffen (57) Vice President Officer Managing Director of the Advisers and Van Kampen Advisors
1 Parkview Plaza since 2000 Inc. Vice President of the senior loan funds advised by the
P.O. Box 5555 Adviser. Prior to 1999, senior portfolio manager for Pilgrim
Oakbrook Terrace, IL 60181 Investments. Associate of the Chartered Institute of Bankers
and a member of the Economic Club of Chicago.
In accordance with Section 303A.12(a) of the New York Stock Exchange Listed
Company Manual, the Fund's Chief Executive Officer has certified to the New York
Stock Exchange that, as of July 18, 2005, he was not aware of any violation by
the Trust of NYSE corporate governance listing standards.
The certifications by the Trust's principal executive officer and principal
financial officer required by Rule 30a-2 under the 1940 Act were filed with the
Trust's report to the SEC on Form N-CSR and are available on the Securities and
Exchange Commission's web site at http://www.sec.gov.
54
Van Kampen Senior Income Trust
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.
(continued on next page)
Van Kampen Senior Income Trust
An Important Notice Concerning Our U.S. Privacy Policy continued
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, 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
(continued on back)
Van Kampen Senior Income Trust
An Important Notice Concerning Our U.S. Privacy Policy continued
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.
VVR ANR 9/05
(VAN KAMPEN INVESTMENTS SHINE LOGO) RN05-00733P-Y 07/05
Item 2. Code of Ethics.
(a) The Trust has adopted a code of ethics (the "Code of Ethics") that
applies to its principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the Trust or
a third party.
(b) No information need be disclosed pursuant to this paragraph.
(c) The Trust has amended its Code of Ethics during the period covered by
the shareholder report presented in Item 1 hereto to delete from the end of the
following paragraph on page 2 of the Code the phrase "to the detriment of the
Fund.":
"Each Covered Officer must not use his personal influence or personal
relationship improperly to influence investment decisions or financial reporting
by the Fund whereby the Covered Officer would benefit personally (directly or
indirectly)."
Further, due to personnel changes at the Adviser, the list of Covered Officers
set forth in Exhibit B and the General Counsel designee to whom questions about
the application of the Code should be referred in Exhibit C were amended during
the period. Exhibit B was then amended again in March 2005 and a third time in
August 2005. All three editions of Exhibit B are attached.
(d) Not applicable.
(e) Not applicable.
(f)
(1) The Trust's Code of Ethics is attached hereto as Exhibit 12A.
(2) Not applicable.
(3) Not applicable.
Item 3. Audit Committee Financial Expert.
The Trust's Board of Trustees has determined that it has one "audit committee
financial expert" serving on its audit committee, "independent" Trustee Rod
Dammeyer. Under applicable securities laws, a person who is determined to be an
audit committee financial expert will not be deemed an "expert" for any purpose,
including without limitation for the purposes of Section 11 of the Securities
Act of 1933, as a result of being designated or identified as an audit committee
financial expert. The designation or identification of a person as an audit
committee financial expert does not impose on such person any duties,
obligations, or liabilities that are greater than the duties, obligations, and
liabilities imposed on such person as a member of the audit committee and Board
of Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
(a)(b)(c)(d) and (g). Based on fees billed for the periods shown:
2005
REGISTRANT COVERED ENTITIES(1)
AUDIT FEES........................ $73,550 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES...... $10,000(2) $321,000(3)
TAX FEES................... $2,400(4) $0
ALL OTHER FEES........... $0 $0
TOTAL NON-AUDIT FEES.......... $12,400 $321,000
TOTAL.............................. $85,950 $321,000
2004
REGISTRANT COVERED ENTITIES(1)
AUDIT FEES........................ $72,780 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES..... $21,500(5) $230,000(3)
TAX FEES.................. $2,300(4) $0
ALL OTHER FEES........... $0 $0
TOTAL NON-AUDIT FEES......... $23,800 $230,000
TOTAL.............................. $96,580 $230,000
N/A- Not applicable, as not required by Item 4.
(1) Covered Entities include the Adviser (excluding sub-advisors)
and any entity controlling, controlled by or under common
control with the Adviser that provides ongoing services to the
Registrant.
(2) Audit-Related Fees represent agreed upon procedures related to
the maintenance of Preferred Shares by the Registrant.
(3) Audit-Related Fees represent assurance and related services
provided that are reasonably related to the performance of the
audit of the financial statements of the Covered Entities' and
funds advised by the Adviser or its affiliates, specifically
attestation services provided in connection with a SAS 70
Report.
(4) Tax Fees represent tax advice and compliance services provided
in connection with the review of the Registrant's tax.
(5) Audit-Related Fees represent agreed upon procedures, and
letters provided to underwriters related to the offering,
issuance and maintenance of Preferred Shares by the
Registrant.
(e)(1) The audit committee's pre-approval policies and procedures are as
follows:
JOINT AUDIT COMMITTEE
AUDIT AND NON-AUDIT SERVICES
PRE-APPROVAL POLICY AND PROCEDURES
OF THE
VAN KAMPEN FUNDS
AS ADOPTED JULY 23, 2003 AND AMENDED MAY 26, 2004(1)
1. STATEMENT OF PRINCIPLES
The Audit Committee of the Board is required to review and, in its sole
discretion, pre-approve all Covered Services to be provided by the Independent
Auditors to the Fund and Covered Entities in order to assure that services
performed by the Independent Auditors do not impair the auditor's independence
from the Fund.(2)
The SEC has issued rules specifying the types of services that an
independent auditor may not provide to its audit client, as well as the audit
committee's administration of the engagement of the independent auditor. The
SEC's rules establish two different approaches to pre-approving services, which
the SEC considers to be equally valid. Proposed services either: may be
pre-approved without consideration of specific case-by-case services by the
Audit Committee ("general pre-approval"); or require the specific pre-approval
of the Audit Committee ("specific pre-approval"). The Audit Committee believes
that the combination of these two approaches in this Policy will result in an
effective and efficient procedure to pre-approve services performed by the
Independent Auditors. As set forth in this Policy, unless a type of service has
received general pre-approval, it will require specific pre-approval by the
Audit Committee (or by any member of the Audit Committee to which pre-approval
authority has been delegated) if it is to be provided by the Independent
Auditors. Any proposed services exceeding pre-approved cost levels or budgeted
amounts will also require specific pre-approval by the Audit Committee.
For both types of pre-approval, the Audit Committee will consider
whether such services are consistent with the SEC's rules on auditor
independence. The Audit Committee will also consider whether the Independent
Auditors are best positioned to provide the most effective and efficient
services, for reasons such as its familiarity with the Fund's business, people,
culture, accounting systems, risk profile and other factors, and whether the
service might enhance the Fund's ability to manage or control risk or improve
audit quality. All such factors will be considered as a whole, and no one factor
should necessarily be determinative.
The Audit Committee is also mindful of the relationship between fees
for audit and non-audit services in deciding whether to pre-approve any such
services and may determine for each fiscal year, the appropriate ratio between
the total amount of fees for Audit, Audit-related and Tax services for the Fund
(including any Audit-related or Tax service fees for Covered Entities that were
subject to pre-approval), and the total amount of fees for certain permissible
non-audit services classified as All Other services for the Fund (including any
such services for Covered Entities subject to pre-approval).
The appendices to this Policy describe the Audit, Audit-related, Tax
and All Other services that have the general pre-approval of the Audit
Committee. The term of any general pre-approval is 12 months from the date of
pre-approval, unless the Audit Committee considers and provides a different
period and states otherwise. The Audit Committee will annually review and
pre-approve the services that may be provided by the Independent Auditors
without obtaining specific pre-approval
------------------------
(1) This Joint Audit Committee Audit and Non-Audit Services Pre-Approval
Policy and Procedures (the "Policy"), amended as of the date above,
supercedes and replaces all prior versions that may have been amended
from time to time.
(2) Terms used in this Policy and not otherwise defined herein shall have
the meanings as defined in the Joint Audit Committee Charter.
from the Audit Committee. The Audit Committee will add to or subtract from the
list of general pre-approved services from time to time, based on subsequent
determinations.
The purpose of this Policy is to set forth the policy and procedures by
which the Audit Committee intends to fulfill its responsibilities. It does not
delegate the Audit Committee's responsibilities to pre-approve services
performed by the Independent Auditors to management.
The Fund's Independent Auditors have reviewed this Policy and believes
that implementation of the Policy will not adversely affect the Independent
Auditors' independence.
2. DELEGATION
As provided in the Act and the SEC's rules, the Audit Committee may
delegate either type of pre-approval authority to one or more of its members.
The member to whom such authority is delegated must report, for informational
purposes only, any pre-approval decisions to the Audit Committee at its next
scheduled meeting.
3. AUDIT SERVICES
The annual Audit services engagement terms and fees are subject to the
specific pre-approval of the Audit Committee. Audit services include the annual
financial statement audit and other procedures required to be performed by the
Independent Auditors to be able to form an opinion on the Fund's financial
statements. These other procedures include information systems and procedural
reviews and testing performed in order to understand and place reliance on the
systems of internal control, and consultations relating to the audit. The Audit
Committee will monitor the Audit services engagement as necessary, but no less
than on a quarterly basis, and will also approve, if necessary, any changes in
terms, conditions and fees resulting from changes in audit scope, Fund structure
or other items.
In addition to the annual Audit services engagement approved by the
Audit Committee, the Audit Committee may grant general pre-approval to other
Audit services, which are those services that only the Independent Auditors
reasonably can provide. Other Audit services may include statutory audits and
services associated with SEC registration statements (on Forms N-1A, N-2, N-3,
N-4, etc.), periodic reports and other documents filed with the SEC or other
documents issued in connection with securities offerings.
The Audit Committee has pre-approved the Audit services in Appendix
B.1. All other Audit services not listed in Appendix B.1 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).
4. AUDIT-RELATED SERVICES
Audit-related services are assurance and related services that are
reasonably related to the performance of the audit or review of the Fund's
financial statements or, to the extent they are Covered Services, the Covered
Entities' financial statements, or that are traditionally performed by the
Independent Auditors. Because the Audit Committee believes that the provision of
Audit-related services does not impair the independence of the auditor and is
consistent with the SEC's rules on auditor independence, the Audit Committee may
grant general pre-approval to Audit-related services. Audit-related services
include, among others, accounting consultations related to accounting, financial
reporting or disclosure matters not classified as "Audit services"; assistance
with understanding and implementing new accounting and financial reporting
guidance from rulemaking authorities; agreed-upon or expanded audit procedures
related to accounting and/or billing records required to respond to or comply
with financial, accounting or regulatory reporting matters; and assistance with
internal control reporting requirements under Forms N-SAR and/or N-CSR.
The Audit Committee has pre-approved the Audit-related services in
Appendix B.2. All other Audit-related services not listed in Appendix B.2 must
be specifically pre-approved by the Audit Committee (or by any member of the
Audit Committee to which pre-approval has been delegated).
5. TAX SERVICES
The Audit Committee believes that the Independent Auditors can provide
Tax services to the Fund and, to the extent they are Covered Services, the
Covered Entities, such as tax compliance, tax planning and tax advice without
impairing the auditor's independence, and the SEC has stated that the
Independent Auditors may provide such services. Hence, the Audit Committee
believes it may grant general pre-approval to those Tax services that have
historically been provided by the Independent Auditors, that the Audit Committee
has reviewed and believes would not impair the independence of the Independent
Auditors, and that are consistent with the SEC's rules on auditor independence.
The Audit Committee will not permit the retention of the Independent Auditors in
connection with a transaction initially recommended by the Independent Auditors,
the sole business purpose of which may be tax avoidance and the tax treatment of
which may not be supported in the Internal Revenue Code and related regulations.
The Audit Committee will consult with Director of Tax or outside counsel to
determine that the tax planning and reporting positions are consistent with this
policy.
Pursuant to the preceding paragraph, the Audit Committee has
pre-approved the Tax Services in Appendix B.3. All Tax services involving large
and complex transactions not listed in Appendix B.3 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated), including tax services proposed to be
provided by the Independent Auditors to any executive officer or
trustee/director/managing general partner of the Fund, in his or her individual
capacity, where such services are paid for by the Fund (generally applicable
only to internally managed investment companies).
6. ALL OTHER SERVICES
The Audit Committee believes, based on the SEC's rules prohibiting the
Independent Auditors from providing specific non-audit services, that other
types of non-audit services are permitted. Accordingly, the Audit Committee
believes it may grant general pre-approval to those permissible non-audit
services classified as All Other services that it believes are routine and
recurring services, would not impair the independence of the auditor and are
consistent with the SEC's rules on auditor independence.
The Audit Committee has pre-approved the All Other services in Appendix
B.4. Permissible All Other services not listed in Appendix B.4 must be
specifically pre-approved by the Audit Committee (or by any member of the Audit
Committee to which pre-approval has been delegated).
A list of the SEC's prohibited non-audit services is attached to this
policy as Appendix B.5. The SEC's rules and relevant guidance should be
consulted to determine the precise definitions of these services and the
applicability of exceptions to certain of the prohibitions.
7. PRE-APPROVAL FEE LEVELS OR BUDGETED AMOUNTS
Pre-approval fee levels or budgeted amounts for all services to be
provided by the Independent Auditors will be established annually by the Audit
Committee. Any proposed services exceeding these levels or amounts will require
specific pre-approval by the Audit Committee. The Audit Committee is mindful of
the overall relationship of fees for audit and non-audit services in determining
whether to pre-approve any such services. For each fiscal year, the Audit
Committee may determine the appropriate ratio between the total amount of fees
for Audit, Audit-related, and Tax services for the Fund (including any
Audit-related or Tax services fees for Covered Entities subject to
pre-approval), and the total amount of fees for certain permissible non-audit
services classified as All Other services for the Fund (including any such
services for Covered Entities subject to pre-approval).
8. PROCEDURES
All requests or applications for services to be provided by the
Independent Auditors that do not require specific approval by the Audit
Committee will be submitted to the Fund's Chief Financial Officer and must
include a detailed description of the services to be rendered. The Fund's Chief
Financial Officer will determine whether such services are included within the
list of services that have received the general pre-approval of the Audit
Committee. The Audit Committee will be informed on a timely basis of any such
services rendered by the Independent Auditors. Requests or applications to
provide services that require specific approval by the Audit Committee will be
submitted to the Audit Committee by both the Independent Auditors and the Fund's
Chief Financial Officer, and must include a joint statement as to whether, in
their view, the request or application is consistent with the SEC's rules on
auditor independence.
The Audit Committee has designated the Fund's Chief Financial Officer
to monitor the performance of all services provided by the Independent Auditors
and to determine whether such services are in compliance with this Policy. The
Fund's Chief Financial Officer will report to the Audit Committee on a periodic
basis on the results of its monitoring. A sample report is included as Appendix
B.7. Both the Fund's Chief Financial Officer and management will immediately
report to the chairman of the Audit Committee any breach of this Policy that
comes to the attention of the Fund's Chief Financial Officer or any member of
management.
9. ADDITIONAL REQUIREMENTS
The Audit Committee has determined to take additional measures on an
annual basis to meet its responsibility to oversee the work of the Independent
Auditors and to assure the auditor's independence from the Fund, such as
reviewing a formal written statement from the Independent Auditors delineating
all relationships between the Independent Auditors and the Fund, consistent with
Independence Standards Board No. 1, and discussing with the Independent Auditors
its methods and procedures for ensuring independence.
10. COVERED ENTITIES
Covered Entities include the Fund's investment adviser(s) and any
entity controlling, controlled by or under common control with the Fund's
investment adviser(s) that provides ongoing services to the Fund(s). Beginning
with non-audit service contracts entered into on or after May 6, 2003, the
Fund's audit committee must pre-approve non-audit services provided not only to
the Fund but also to the Covered Entities if the engagements relate directly to
the operations and financial reporting of the Fund. This list of Covered
Entities would include:
- Van Kampen Investments Inc.
- Van Kampen Asset Management
- Van Kampen Advisors Inc.
- Van Kampen Funds Inc.
- Van Kampen Investor Services Inc.
- Morgan Stanley Investment Management Inc.
- Morgan Stanley Trust Company
- Morgan Stanley Investment Management Ltd.
- Morgan Stanley Investment Management Company
- Morgan Stanley Asset & Investment Trust Management Company Ltd.
(e)(2) Beginning with non-audit service contracts entered into on or after May
6, 2003, the audit committee also is required to pre-approve services to Covered
Entities to the extent that the services
are determined to have a direct impact on the operations or financial reporting
of the Registrant. 100% of such services were pre-approved by the audit
committee pursuant to the Audit Committee's pre-approval policies and procedures
(included herein).
(f) Not applicable.
(g) See table above.
(h) The audit committee of the Board of Trustees has considered whether the
provision of services other than audit services performed by the auditors to the
Registrant and Covered Entities is compatible with maintaining the auditors'
independence in performing audit services.
Item 5. Audit Committee of Listed Registrants.
(a) The Trust has a separately-designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Exchange Act whose members are:
David Arch, Rod Dammeyer, Howard Kerr, Hugo Sonnenschein.
(b) Not applicable.
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.
The Trust's and its investment advisor's Proxy Voting Policies and Procedures
are as follows:
MORGAN STANLEY INVESTMENT MANAGEMENT
PROXY VOTING POLICY AND PROCEDURES
I. POLICY STATEMENT
Introduction - Morgan Stanley Investment Management's ("MSIM") policy and
procedures for voting proxies ("Policy") with respect to securities held in the
accounts of clients applies to those MSIM entities that provide discretionary
investment management services and for which a MSIM entity has authority to vote
proxies. The Policy will be reviewed and, updated, as necessary, to address new
or revised proxy voting issues. The MSIM entities covered by the Policy
currently include the following: Morgan Stanley Investment Advisors Inc., Morgan
Stanley AIP GP LP, Morgan Stanley Investment Management Inc., Morgan Stanley
Investment Management Limited, Morgan Stanley Investment Management Company,
Morgan Stanley Asset & Investment Trust Management Co., Limited, Morgan Stanley
Investment Management Private Limited, Morgan Stanley Hedge Fund Partners GP LP,
Morgan Stanley Hedge Fund Partners LP, Van Kampen Asset Management, and Van
Kampen Advisors Inc. (each an "MSIM Affiliate" and collectively referred to as
the "MSIM Affiliates").
Each MSIM Affiliate will use its best efforts to vote proxies as part of its
authority to manage, acquire and dispose of account assets. With respect to the
MSIM registered management investment companies (Van Kampen, Institutional and
Advisor Funds)(collectively referred to herein as the "MSIM Funds"), each MSIM
Affiliate will vote proxies pursuant to authority granted under its applicable
investment advisory agreement or, in the absence of such authority, as
authorized by the Board of Directors or Trustees of the MSIM Funds. A MSIM
Affiliate will not vote proxies if the "named fiduciary" for an ERISA
account has reserved the authority for itself, or in the case of an account not
governed by ERISA, the investment management or investment advisory agreement
does not authorize the MSIM Affiliate to vote proxies. MSIM Affiliates will, in
a prudent and diligent manner, vote proxies in the best interests of clients,
including beneficiaries of and participants in a client's benefit plan(s) for
which the MSIM Affiliates manage assets, consistent with the objective of
maximizing long-term investment returns ("Client Proxy Standard"). In certain
situations, a client or its fiduciary may provide a MSIM Affiliate with a proxy
voting policy. In these situations, the MSIM Affiliate will comply with the
client's policy unless to do so would be inconsistent with applicable laws or
regulations or the MSIM Affiliate's fiduciary responsibility.
Proxy Research Services - Institutional Shareholder Services ("ISS") and Glass
Lewis (together with other proxy research providers as MSIM Affiliates may
retain from time to time, the "Research Providers") are independent advisers
that specialize in providing a variety of fiduciary-level proxy-related services
to institutional investment managers, plan sponsors, custodians, consultants,
and other institutional investors. The services provided include in-depth
research, global issuer analysis, and voting recommendations. While the MSIM
Affiliates may review and utilize the recommendations of the Research Providers
in making proxy voting decisions, they are in no way obligated to follow such
recommendations. In addition to research, ISS provides vote execution,
reporting, and recordkeeping. MSIM's Proxy Review Committee (see Section IV.A.
below) will carefully monitor and supervise the services provided by the
Research Providers.
Voting Proxies for Certain Non-U.S. Companies - While the proxy voting process
is well established in the United States and other developed markets with a
number of tools and services available to assist an investment manager, voting
proxies of non-U.S. companies located in certain jurisdictions, particularly
emerging markets, may involve a number of problems that may restrict or prevent
a MSIM Affiliate's ability to vote such proxies. These problems include, but are
not limited to: (i) proxy statements and ballots being written in a language
other than English; (ii) untimely and/or inadequate notice of shareholder
meetings; (iii) restrictions on the ability of holders outside the issuer's
jurisdiction of organization to exercise votes; (iv) requirements to vote
proxies in person, (v) the imposition of restrictions on the sale of the
securities for a period of time in proximity to the shareholder meeting; and
(vi) requirements to provide local agents with power of attorney to facilitate
the MSIM Affiliate's voting instructions. As a result, clients' non-U.S. proxies
will be voted on a best efforts basis only, after weighing the costs and
benefits to MSIM's clients of voting such proxies, consistent with the Client
Proxy Standard. ISS has been retained to provide assistance to the MSIM
Affiliates in connection with voting their clients' non-U.S. proxies.
II. GENERAL PROXY VOTING GUIDELINES
To ensure consistency in voting proxies on behalf of its clients, MSIM
Affiliates will follow (subject to any exception set forth herein) this Policy,
including the guidelines set forth below. These guidelines address a broad range
of issues, including board size and composition, executive compensation,
anti-takeover proposals, capital structure proposals and social responsibility
issues and are meant to be general voting parameters on issues that
arise most frequently. The MSIM Affiliates, however, may, pursuant to the
procedures set forth in Section IV. below, vote in a manner that is not in
accordance with the following general guidelines, provided the vote is approved
by the Proxy Review Committee and is consistent with the Client Proxy Standard.
A MSIM Affiliate will not generally vote a proxy if it has sold the affected
security between the record date and the meeting date.
III. GUIDELINES
A. CORPORATE GOVERNANCE MATTERS. The following proposals will generally
be voted as indicated below, unless otherwise determined by the Proxy Review
Committee.
i. General.
1. Generally, routine management proposals will be supported. The
following are examples of routine management proposals:
o Approval of financial statements, director and
auditor reports.
o General updating/corrective amendments to the
charter.
o Proposals related to the conduct of the annual
meeting, except those proposals that relate to the
"transaction of such other business which may come
before the meeting."
2. Proposals to eliminate cumulative voting generally will be
supported; proposals to establish cumulative voting in the
election of directors will not be supported.
3. Proposals requiring confidential voting and independent
tabulation of voting results will be supported.
4. Proposals requiring a U.S. company to have a separate Chairman
and CEO will not be supported. Proposals requiring non-U.S.
companies to have a separate Chairman and CEO will be
supported.
5. Proposals by management of non-U.S. companies regarding items
that are clearly related to the regular course of business
will be supported.
6. Proposals to require the company to expense stock options will
be supported.
7. Open-ended requests for adjournment generally will not be
supported. However, where management specifically states the
reason for requesting an adjournment and the requested
adjournment is necessary to permit a proposal that would
otherwise be supported under this Policy to be carried out
(i.e. an uncontested corporate transaction), the adjournment
request will be supported.
8. Proposals to declassify the Board of Directors (if management
supports a classified board) generally will not be supported.
9. Proposal requiring that the company prepare reports that are
costly to provide or that would require duplicative efforts or
expenditures that are of a non-business nature or would
provide no pertinent information from the perspective of
institutional shareholders generally will not be supported.
ii. Election of Directors. In situations where no conflict exists
and where no specific governance deficiency has been noted, unless
otherwise determined by the Proxy Review Committee, proxies will be
voted in support of nominees of management.
1. The following proposals generally will be supported:
-
o Proposals requiring that a certain percentage (up to 66
2/3%) of the company's board members be independent
directors.
o Proposals requiring that members of the company's
compensation, nominating and audit committees be comprised
of independent or unaffiliated directors.
2. Unless otherwise determined by the Proxy Review Committee, a
withhold vote will be made in the following circumstances:
(a) If a company's board is not comprised of a majority of
disinsterested directors, a withhold vote will be made for
interested directors. A director nominee may be deemed to
be interested if the nominee has, or any time during the
previous five years had, a relationship with the issuer
(e.g., investment banker, counsel or other professional
service provider, or familial relationship with a senior
officer of the issuer) that may impair his or her
independence;
(b) If a nominee who is interested is standing for election as
a member of the company's compensation, nominating or
audit committees;
(c) A direct conflict exists between the interests of the
nominee and the public shareholders;
(d) Where the nominees standing for election have not taken
action to implement generally accepted governance
practices for which there is a "bright line" test. These
would include elimination of dead hand or slow hand poison
pills, requiring audit, compensation or nominating
committees to be composed of independent directors and
requiring a majority independent board;
(e) A nominee has failed to attend at least 75% of board
meetings within a given year without a reasonable excuse;
or
(f) A nominee serves on the board of directors for more than
six companies (excluding investment companies).
iii. Auditors
1. Generally, management proposals for selection or ratification
of auditors will be supported. However, such proposals may not
be supported if the audit fees are excessive. Generally, to
determine if audit fees are excessive, a 50% test will be
applied for audit fees in excess of $1 million: if audit fees
are $1 million or more, non-audit fees should less than 50% of
the total fees paid to the auditor. If audit fees are less
than $1 million, the fees will be reviewed case by case by the
Proxy Review Committee.
2. Proposals requiring auditors to attend the annual meeting of
shareholders will be supported.
3. Proposals to indemnify auditors will not be supported.
iv. Anti-Takeover Matters
1. Proposals to modify or rescind existing supermajority vote
requirements to amend the charter or bylaws will be supported;
proposals to amend by-laws to require a supermajority
shareholder vote to pass or repeal certain provisions will not
be supported.
2. Proposals relating to the adoption of anti-greenmail
provisions will be supported, provided that the proposal: (i)
defines greenmail; (ii) prohibits buyback offers to large
block holders (holders of at least 1% of the outstanding
shares and in certain cases, a greater amount, as determined
by the Proxy Review Committee) not made to all shareholders or
not approved by disinterested shareholders; and (iii) contains
no anti-takeover measures or other provisions restricting the
rights of shareholders.
3. Proposals requiring shareholder approval or ratification of a
shareholder rights plan or poison pill will be supported.
B. CAPITALIZATION CHANGES. The following proposals generally will be
voted as indicated below, unless otherwise determined by the Proxy Review
Committee.
1. The following proposals generally will be supported:
o Proposals relating to capitalization changes that
eliminate other classes of stock and/or eliminate
unequal voting rights.
o Proposals to increase the authorization of existing
classes of common stock (or securities convertible
into common stock) if: (i) a clear and legitimate
business purpose is stated; (ii) the number of shares
requested is reasonable in relation to the purpose
for which authorization is requested; and (iii) the
authorization does not exceed 100% of shares
currently authorized and at least 30% of the new
authorization will be outstanding.
o Proposals to create a new class of preferred stock or
for issuances of preferred stock up to 50% of issued
capital.
o Proposals for share repurchase plans.
o Proposals to reduce the number of authorized shares
of common or preferred stock, or to eliminate classes
of preferred stock.
o Proposals to effect stock splits.
o Proposals to effect reverse stock splits if
management proportionately reduces the authorized
share amount set forth in the corporate charter.
Reverse stock splits that do not adjust
proportionately to the authorized share amount
generally will be approved if the resulting increase
in authorized shares coincides with the proxy
guidelines set forth above for common stock
increases.
2. The following proposals generally will not be supported
(notwithstanding management support).
o Proposals relating to capitalization changes that add
classes of stock which substantially dilute the
voting interests of existing shareholders.
o Proposals to increase the authorized number of shares
of existing classes of stock that carry preemptive
rights or supervoting rights.
o Proposals to create "blank check" preferred stock.
o Proposals relating to changes in capitalization by
100% or more.
C. COMPENSATION. The following proposals generally will be voted as
indicated below, unless otherwise determined by the Proxy Review Committee.
1. The following proposals generally will be supported:
o Proposals relating to director fees, provided the
amounts are not excessive relative to other companies
in the country or industry.
o Proposals for employee stock purchase plans that
permit discounts up to 15%, but only for grants that
are part of a broad-based employee plan, including
all non-executive employees.
o Proposals for the establishment of employee stock
option plans and other employee ownership plans,
provided that our research does not indicate that
approval of the plan would be against shareholder
interest.
o Proposals for the establishment of employee
retirement and severance plans, provided that our
research does not indicate that approval of the plan
would be against shareholder interest.
2. Blanket proposals requiring shareholder approval of all
severance agreements will not be supported, however, proposals
that require shareholder approval for agreements in excess of
three times the annual compensation (salary and bonus)
generally will be supported.
3. Blanket proposals requiring shareholder approval of executive
compensation generally will not be supported.
4. Proposals that request or require disclosure of executive
compensation in addition to the disclosure required by the
Securities and Exchange Commission ("SEC") regulations
generally will not be supported.
D. OTHER RECURRING ITEMS. The following proposals generally will be voted
as indicated below, unless otherwise determined by the Proxy Review Committee.
1. Proposals to add restrictions related to social, political,
environmental or special interest issues that do not relate
directly to the business of the company and which do not
appear to be directed specifically to the business or
financial interest of the company generally will not be
supported.
2. Proposals requiring adherence to workplace standards that are
not required or customary in market(s) to which the proposals
relate will not be supported.
E. ITEMS TO BE REVIEWED BY THE PROXY REVIEW COMMITTEE
The following types of non-routine proposals, which potentially may have a
substantive financial or best interest impact on an issuer, will be voted as
determined by the Proxy Review Committee.
I. CORPORATE TRANSACTIONS
o Proposals relating to mergers, acquisitions and other
special corporate transactions (i.e., takeovers,
spin-offs, sales of assets, reorganizations,
restructurings and recapitalizations) will be examined on
a case-by-case basis. In all cases, Research Providers'
research and analysis will be used along with MSIM
Affiliates' research and analysis, including, among other
things, MSIM internal company-specific knowledge.
Proposals for mergers or other significant transactions
that are friendly, approved by the Research Providers, and
where there is no portfolio manager objection, generally
will be supported.
ii. Compensation
o Proposals relating to change-in-control provisions in
non-salary compensation plans, employment contracts, and
severance agreements that benefit management and would be
costly to shareholders if triggered. With respect to
proposals related to severance and change of control
situations, MSIM Affiliates will support a maximum of
three times salary and bonus.
o Proposals relating to Executive/Director stock option
plans. Generally, stock option plans should be incentive
based. The Proxy Review Committee will evaluate the the
quantitative criteria used by a Research Provider when
considering such Research Provider's recommendation. If
the Proxy Review Committee determines that the criteria
used by the Research Provider is reasonable, the proposal
will be supported if it falls within a 5% band above the
Research Provider's threshold.
o Compensation proposals that allow for discounted stock
options that have not been offered to employees in
general.
iii. Other
o Proposals for higher dividend payouts.
o Proposals recommending set retirement ages or requiring
specific levels of stock ownership by directors.
o Proposals for election of directors, where a director
nominee is related to MSIM (i.e. on an MSIM Fund's Board
of Directors/Trustees or part of MSIM senior management)
must be considered by the Proxy Review Committee. If the
proposal relates to a director nominee who is on a Van
Kampen Fund's Board of Directors/Trustees, to the extent
that the shares of the relevant company are held by a Van
Kampen Fund, the Van Kampen Board shall vote the proxies
with respect to those shares, to the extent practicable.
In the event that the Committee cannot contact the Van
Kampen Board in advance of the shareholder meeting, the
Committee will vote such shares pursuant to the Proxy
Voting Policy.
o Proposals requiring diversity of board membership relating
to broad based social, religious or ethnic groups.
o Proposals to limit directors' liability and/or broaden
indemnification of directors. Generally, the Proxy Review
Committee will support such proposals provided that the
officers and directors are eligible for indemnification
and liability protection if they have acted in good faith
on company business and were found innocent of any civil
or criminal charges for duties performed on behalf of the
company.
IV. ADMINISTRATION OF POLICY
A. PROXY REVIEW COMMITTEE
1. The MSIM Proxy Review Committee ("Committee") is responsible
for creating and implementing the Policy and, in this regard,
has expressly adopted it.
(a) The Committee, which is appointed by MSIM's Chief
Investment Officer ("CIO"), consists of senior
investment professionals who represent the different
investment disciplines and geographic locations of
the firm. The Committee is responsible for
establishing MSIM's Policy and determining how MSIM
will vote proxies on an ongoing basis.
(b) The Committee will periodically review and have the
authority to amend, as necessary, the Policy and
establish and direct voting positions consistent with
the Client Proxy Standard.
(c) The Committee will meet at least monthly to (among
other matters): (1) address any outstanding issues
relating to the Policy and (2) review proposals at
upcoming shareholder meetings of MSIM portfolio
companies in accordance with this Policy including,
as appropriate, the voting results of prior
shareholder meetings of the same issuer where a
similar proposal was presented to shareholders. The
Committee, or its designee, will timely communicate
to ISS MSIM's Policy (and any amendments to them
and/or any additional guidelines or procedures it may
adopt).
(d) The Committee will meet on an ad hoc basis to (among
other matters): (1) authorize "split voting" (i.e.,
allowing certain shares of the same issuer that are
the subject of the same proxy solicitation and held
by one or more MSIM portfolios to be voted
differently than other shares) and/or "override
voting" (i.e., voting all MSIM portfolio shares in a
manner contrary to the Policy); (2) review and
approve upcoming votes, as appropriate, for matters
for which specific direction has been provided in
this Policy; and (3) determine how to vote matters
for which specific direction has not been provided in
this Policy. Split votes generally will not be
approved within a single Global Investor Group
investment team. The Committee may take into account
Research Providers' recommendations and research as
well as any other relevant information they may
request or receive, including portfolio manager
and/or analyst research, as applicable. Generally,
proxies related to securities held in accounts that
are managed pursuant to quantitative, index or
index-like strategies ("Index Strategies") will be
voted in the same manner as those held in actively
managed accounts. Because accounts managed using
Index Strategies are passively managed accounts,
research from portfolio managers and/or analysts
related to securities held in these accounts may not
be available. If the affected securities are held
only in accounts that are managed pursuant to Index
Strategies, and the proxy relates to a matter that is
not described in this Policy, the Committee will
consider all available information from the Research
Providers, and to the extent that the holdings are
significant, from the portfolio managers and/or
analysts.
(e) In addition to the procedures discussed above, if the
Committee determines that an issue raises a potential
material conflict of interest, or gives rise to the
appearance of a potential material conflict of
interest, the Committee will request a special
committee to review, and recommend a course of action
with respect to, the conflict(s) in question
("Special Committee"). The Special Committee shall be
comprised of the Chairperson of the Proxy Review
Committee, the Compliance Director for the area of
the firm involved or his/her designee, a senior
portfolio manager (if practicable, one who is a
member of the Proxy Review Committee) designated by
the Proxy Review Committee, and MSIM's Chief
Investment Officer or his/her designee. The Special
Committee may request the assistance of MSIM's
General Counsel or his/her designee and will have
sole discretion to cast a vote. In addition to the
research provided by Research Providers, the Special
Committee may request analysis from MSIM Affiliate
investment professionals and outside sources to the
extent it deems appropriate.
(f) The Committee and the Special Committee, or their
designee(s), will document in writing all of their
decisions and actions, which documentation will be
maintained by the Committee and the Special
Committee, or their designee(s), for a period of at
least 6 years. To the extent these decisions relate
to a security held by a MSIM U.S. registered
investment company, the Committee and Special
Committee, or their designee(s), will report their
decisions to each applicable Board of
Trustees/Directors of those investment companies at
each Board's next regularly scheduled Board meeting.
The report will contain information concerning
decisions made by the Committee and Special Committee
during the most recently ended calendar quarter
immediately preceding the Board meeting.
(g) The Committee and Special Committee, or their
designee(s), will timely communicate to applicable
portfolio managers, the Compliance Departments and,
as necessary, to ISS, decisions of the Committee and
Special Committee so that, among other things, ISS
will vote proxies consistent with their decisions.
B. IDENTIFICATION OF MATERIAL CONFLICTS OF INTEREST
1. If there is a possibility that a vote may involve a
material conflict of interest, the vote must be decided by
the Special Committee in consultation with MSIM's General
Counsel or his/her designee.
2. A material conflict of interest could exist in the
following situations, among others:
(a) The issuer soliciting the vote is a client of MSIM or an
affiliate of MSIM and the vote is on a material matter
affecting the issuer;
(b) The proxy relates to Morgan Stanley common stock or any
other security issued by Morgan Stanley or its affiliates;
or
(c) Morgan Stanley has a material pecuniary interest in the
matter submitted for a vote (e.g., acting as a financial
advisor to a party to a merger or acquisition for which
Morgan Stanley will be paid a success fee if completed).
C. PROXY VOTING REPORTS
(a) MSIM will promptly provide a copy of this Policy to
any client requesting them. MSIM will also, upon
client request, promptly provide a report indicating
how each proxy was voted with respect to securities
held in that client's account.
(b) MSIM's legal department is responsible for filing an
annual Form N-PX on behalf of each registered
management investment company for which such filing
is required, indicating how all proxies were voted
with respect to such investment company's holdings.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Applicable only for reports covering fiscal years on or after December 31, 2005.
Item 9. Purchase 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 Trust's principal executive officer and principal financial officer have
concluded that the Trust's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Trust 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) The Code of Ethics for Principal Executive and Senior Financial Officers is
attached hereto.
(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 Income Trust
By: /s/ Ronald E. Robison
---------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: September 19, 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: September 19, 2005
By: /s/ Phillip G. Goff
-------------------
Name: Phillip G. Goff
Title: Principal Financial Officer
Date: September 19, 2005