-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BRjjLwXCPX2tZrBTsIJqBTz9wgUdzzL+GIPPd/87jvHaDjpP5p/g6dRcAF0sP3hJ o+7FrCu7upjPmJfQTCTP1g== 0001193125-05-047692.txt : 20050311 0001193125-05-047692.hdr.sgml : 20050311 20050311143821 ACCESSION NUMBER: 0001193125-05-047692 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20041231 FILED AS OF DATE: 20050311 DATE AS OF CHANGE: 20050311 EFFECTIVENESS DATE: 20050311 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SUNAMERICA SENIOR FLOATING RATE FUND INC CENTRAL INDEX KEY: 0001059040 IRS NUMBER: 043412472 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-08727 FILM NUMBER: 05675106 BUSINESS ADDRESS: STREET 1: 286 CONGRESS ST STREET 2: C/O NORTH AMERICAN FUNDS CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6173683535 MAIL ADDRESS: STREET 1: C/O NORTH AMERICAN FUNDS STREET 2: 286 CONGRESS ST CITY: BOSTON STATE: MA ZIP: 02110 FORMER COMPANY: FORMER CONFORMED NAME: NORTH AMERICAN SENIOR FLOATING RATE FUND INC DATE OF NAME CHANGE: 19980401 N-CSR 1 dncsr.txt SUNAMERICA SENIOR FLOATING RATE FUND, INC. 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 811-08727 SunAmerica Senior Floating Rate Fund, Inc. (Exact name of registrant as specified in charter) Harborside Financial Center, 3200 Plaza 5, Jersey City, NJ 07311 (Address of principal executive offices) (Zip code) Vincent M. Marra Senior Vice President & Chief Operating Officer AIG SunAmerica Asset Management Corp. Harborside Financial Center 3200 Plaza 5 Jersey City, NJ 07311 (Name and address of agent for service) Registrant's telephone number, including area code: (201) 324-6464 Date of fiscal year end: December 31 Date of reporting period: December 31, 2004 Item 1. Reports to Stockholders SunAmerica Senior Floating Rate Fund, Inc. Annual report at December 31, 2004. [GRAPHIC] SunAmerica THE RETIREMENT SPECIALIST Senior Floating Rate Fund 2004 ANNUAL REPORT [LOGO] AIG Sun America Mutual Funds Table of Contents PRESIDENT'S LETTER..................................... 1 SENIOR FLOATING RATE FUND REVIEW....................... 2 STATEMENT OF ASSETS AND LIABILITIES.................... 3 STATEMENT OF OPERATIONS................................ 4 STATEMENT OF CHANGES IN NET ASSETS..................... 5 STATEMENT OF CASH FLOWS................................ 6 FINANCIAL HIGHLIGHTS................................... 7 PORTFOLIO OF INVESTMENTS............................... 12 NOTES TO FINANCIAL STATEMENTS.......................... 17 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 23 DIRECTORS AND OFFICERS INFORMATION..................... 24
December 31, 2004 ANNUAL REPORT President's Letter Dear Shareholder; We are pleased to present you with the annual report for the SunAmerica Senior Floating Rate Fund. During 2004, the Fund benefited from a combination of improving credit fundamentals and investments in several industry sectors that had become undervalued. As anticipated, when conditions within these industries began to improve, many bank loan prices in these industries also rose. A long anticipated increase in interest rates also fueled the market. This was precipitated by two notable changes in economic data: improvement in domestic employment numbers and a spike in inflation. On June 30/th/, 2004, the Federal Open Market Committee raised the Federal Funds rate 25 basis points, the first of several through year-end. The Fund continued to pursue credit analysis practices that enabled it to uncover important trends in the bank loan market early on, thus capturing more incremental gains when conditions to do so were present. In all, the Fund had a solid year. We wish you all the best in 2005 and thank you for your continued interest in the SunAmerica Senior Floating Rate Fund. Sincerely, /s/ Peter A. Harbeck Peter A. Harbeck President AIG SunAmerica Asset Management Corp. - -------- Past performance is no guarantee of future results. SunAmerica Senior Floating Rate Fund Chris Jansen and Team, Portfolio Managers Stanfield Capital Partners, LLC In the twelve-month period from January 1 to December 31, 2004, the bank loan market benefited from the strengthening economy and lower forecasted defaults. Credit fundamentals of companies issuing loans improved throughout the year and demand for bank loan investing grew. On June 30/th/, 2004, the Federal Open Market Committee instituted a 25 basis point hike in the Fed Funds rate -- the first increase since May 2000. This marked the beginning of an incremental rate increase that led to an overall 125 basis point rise in the Fed Funds rate by year-end. Anticipating these market conditions, we made opportunistic purchases for the Fund, and loans within the portfolio generally experienced price increases. The performance of the Fund also benefited from specific sector and security selection. For example, investments in Utilities and Broadcasting & Entertainment outperformed in the fourth quarter and the Fund saw strong returns from these areas. Both sectors continued their rebound after being undervalued due to sector concerns. We saw gains in our holdings in NTL, a European cable provider, and Century Cable, the Adelphia subsidiary we have held during Adelphia's bankruptcy. The Fund also benefited from a position in a West Coast based energy producer, Calpine. This volatile credit quality of Calpine improved due to increased comfort with the company's liquidity situation. Positions in Pan Am Sat (a satellite company) and Invensys (a diversified industrial equipment manufacturer) also appreciated. Poor performing issuers included Atkins, a low carb food manufacturer dealing with liquidity problems due to poor order levels. Also, Grand Vehicle Works, an automotive supplier to specialty markets, was recently buffeted by concerns over high metals prices. Healthcare and Broadcasting & Entertainment continued to be the Fund's largest holdings, representing 8.7% and 8.3% of the portfolio, respectively. - -------- The Fund is not a money market fund and its net asset value may fluctuate. Investments in Loans involve certain risks including nonpayment of principal and interest; collateral impairment; nondiversification and borrower industry concentration; and lack of liquidity, which may impair the Fund's ability to obtain full value for Loans sold. The fund may invest all or substantially all of its assets in Loans or other securities that are rated below investment grade, or in comparable unrated securities. Credit risks include the possibility of a default on the Loan or bankruptcy of the borrower. The value of these Loans is subject to a greater degree of volatility in response to interest rate fluctuations. Past performance is no guarantee of future results. 2 SunAmerica Senior Floating Rate Fund, Inc. STATEMENT OF ASSETS AND LIABILITIES -- December 31, 2004 ASSETS: Long-term investment securities, at value (unaffiliated)*......... $211,295,346 Short-term investment securities, at value*....................... 22,516,667 ------------ Total investments............................................... 233,812,013 Cash.............................................................. 1,989,211 Receivable for: Fund shares sold................................................ 171,282 Dividends and interest.......................................... 1,293,532 Investments sold................................................ 1,529,729 Prepaid expenses and other assets................................. 22,171 Due from investment adviser for expense reimbursements/fee waivers 87,519 Due from distributor for fee waivers.............................. 42,843 ------------ Total assets.................................................... 238,948,300 ------------ LIABILITIES: Payable for: Fund shares repurchased......................................... 6,634,700 Investments purchased........................................... 1,584,677 Investment advisory and management fees......................... 166,415 Distribution and service maintenance fees....................... 128,533 Administration fees............................................. 78,313 Directors' fees and expenses.................................... 7,292 Other accrued expenses.......................................... 123,515 Dividends payable................................................. 257,325 Commitments (Note 10)............................................. -- ------------ Total liabilities............................................... 8,980,770 ------------ Net assets..................................................... $229,967,530 ============ NET ASSETS REPRESENTED BY: Capital shares at par value of $.01............................... $ 244,312 Additional paid-in capital........................................ 257,543,377 ------------ 257,787,689 Accumulated undistributed net investment income (loss)............ (47,153) Accumulated undistributed net realized gain (loss) on investments. (27,711,807) Unrealized appreciation (depreciation) on investments............. (61,199) ------------ Net assets........................................................ $229,967,530 ============
Class A Class B Class C Class D NET ASSET VALUES: -------- ----------- ------------ ------------ Net assets................................................... $224,431 $27,529,959 $174,583,309 $ 27,629,831 Shares outstanding........................................... 23,839 2,924,770 18,547,365 2,935,242 Net asset value, offering and repurchase price per share (excluding any applicable contingent deferred sales charges) $ 9.41 $ 9.41 $ 9.41 $ 9.41 ======== =========== ============ ============ *COST Long-term investment securities (unaffiliated)............................................. $211,356,545 ============ Short-term investment securities........................................................... $ 22,516,667 ============
See Notes to Financial Statements 3 SunAmerica Senior Floating Rate Fund, Inc. STATEMENT OF OPERATIONS -- For the year ended December 31, 2004 INVESTMENT INCOME: Interest (unaffiliated)........................................................... $ 8,514,824 Dividends (unaffiliated).......................................................... 213,065 Facility and other fee income (Note 2)............................................ 687,968 ----------- Total investment income........................................................ 9,415,857 ----------- EXPENSES: Investment advisory and management fees........................................... 1,663,171 Administration fees............................................................... 781,306 Distribution and service maintenance fees: Class A......................................................................... 342 Class B......................................................................... 205,829 Class C......................................................................... 1,108,580 Transfer agent fees and expenses: Class A......................................................................... 1,453 Class B......................................................................... 23,603 Class C......................................................................... 76,597 Class D......................................................................... 7,925 Registration fees: Class A......................................................................... 8,723 Class B......................................................................... 2,480 Class C......................................................................... 13,700 Class D......................................................................... 8,620 Accounting service fees........................................................... 59,160 Custodian fees.................................................................... 73,402 Reports to shareholders........................................................... 106,010 Audit and tax fees................................................................ 91,698 Legal fees........................................................................ 120,955 Directors' fees and expenses...................................................... 35,010 Interest expense.................................................................. 109 Other expenses.................................................................... 77,446 ----------- Total expenses before fee waivers, expense reimbursements and custody credits.. 4,466,119 Fees waived and expenses reimbursed by investment adviser and distributor...... (1,136,934) Custody credits earned on cash balances........................................ (6,425) ----------- Net expenses................................................................... 3,322,760 ----------- Net investment income (loss)...................................................... 6,093,097 ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on investments (unaffiliated)............................ (1,564,659) Change in unrealized appreciation (depreciation) on investments................... 2,996,261 ----------- Net realized and unrealized gain (loss) on investments............................ 1,431,602 ----------- INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....................... $ 7,524,699 ===========
See Notes to Financial Statements 4 SunAmerica Senior Floating Rate Fund, Inc. STATEMENT OF CHANGES IN NET ASSETS
For the year For the year ended ended December 31, December 31, 2004 2003 ------------ ------------ INCREASE (DECREASE) IN NET ASSETS: Operations: Net investment income (loss).......................................................... $ 6,093,097 $ 5,512,446 Net realized gain (loss) on investments (unaffiliated)................................ (1,564,659) (5,464,399) Net unrealized gain (loss) on investments (unaffiliated).............................. 2,996,261 13,022,369 ------------ ------------ Increase (decrease) in net assets resulting from operations............................. 7,524,699 13,070,416 ------------ ------------ Distributions To Shareholders From: Net investment income (Class A)....................................................... (4,667) -- Net investment income (Class B)....................................................... (837,534) (1,250,414) Net investment income (Class C)....................................................... (4,536,155) (3,676,409) Net investment income (Class D)....................................................... (729,045) (636,830) ------------ ------------ Total distributions to shareholders..................................................... (6,107,401) (5,563,653) ------------ ------------ Net increase (decrease) in net assets resulting from capital share transactions (Note 3) $ 84,890,736 $ 3,107,689 ------------ ------------ Total increase (decrease) in net assets................................................. 86,308,034 10,614,452 NET ASSETS: Beginning of period..................................................................... 143,659,496 133,045,044 ------------ ------------ End of period+.......................................................................... $229,967,530 $143,659,496 ============ ============ +Includes undistributed net investment income (loss).................................... $ (47,153) $ (32,849) ============ ============
See Notes to Financial Statements 5 SunAmerica Senior Floating Rate Fund, Inc. STATEMENT OF CASH FLOWS -- For the year ended December 31, 2004 INCREASE (DECREASE) IN CASH Cash flows from operating activities: Net increase in net assets from operations.................................................................. $ 7,524,699 Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities Purchase of loans......................................................................................... (236,656,917) Proceed from loans sold................................................................................... 41,929,953 Loan principal paydowns................................................................................... 107,879,052 Purchases -- funding fees................................................................................. 83,241 Purchase of short-term securities, net.................................................................... (3,714,449) Accretion of facility fee income.......................................................................... (307,440) Increase in dividends and interest receivable............................................................. (638,117) Decrease in receivables for securities sold............................................................... 974,646 Decrease in amount due from investment adviser............................................................ 3,350 Increase in amount due from distributor................................................................... (15,876) Increase in other assets.................................................................................. (22,171) Increase in payable for securities purchased.............................................................. 1,584,677 Increase in payable to the adviser........................................................................ 63,224 Decrease in other liabilities............................................................................. (52,785) Unrealized appreciation on securities..................................................................... (2,996,261) Net realized loss from investments........................................................................ 1,564,659 ------------- Net cash used by operating activities....................................................................... $ (82,796,515) ------------- Cash flows from financing activities: Proceeds from shares sold................................................................................... 129,381,069 Payment on shares repurchased............................................................................... (44,251,335) Cash dividends paid (not including reinvested dividends of $3,958,271)...................................... (2,010,366) ------------- Net cash provided by financing activities................................................................... $ 83,119,368 ------------- Net increase in cash........................................................................................ 322,853 Cash balance at beginning of period......................................................................... 1,666,358 ------------- Cash balance at end of period............................................................................... $ 1,989,211 =============
See Notes to Financial Statements 6 SunAmerica Senior Floating Rate Fund, Inc. FINANCIAL HIGHLIGHTS
Class A ----------- For the period from 4/28/04* through 12/31/04 ----------- Net Asset Value, Beginning of Period........................................... $ 9.42 Investment Operations: Net investment income (loss)@.................................................. 0.22 Net realized and unrealized gain (loss) on investments......................... (0.01) ------ Total from investment operations............................................. 0.21 ------ Distributions: Dividends from net investment income........................................... (0.22) ------ Net Asset Value, End of Period................................................. $ 9.41 ------ Total Return(1)................................................................ 2.22% Ratios/Supplemental Data Net assets, end of period ($000's)............................................. $ 224 Ratio of net expenses to average net assets.................................... 1.45%# Ratio of net investment income to average net assets........................... 3.44%# Portfolio turnover rate........................................................ 24% Expense ratio before waiver of fees and reimbursement of expenses.............. 9.31%# Net investment income ratio before waiver of fees and reimbursement of expenses (4.42)%#
- -------- * Inception date of class @ Calculated based upon average shares outstanding. # Annualized (1)Total return is not annualized and does not reflect sales load but does include expense reimbursements. See Notes to Financial Statements 7 SunAmerica Senior Floating Rate Fund, Inc. FINANCIAL HIGHLIGHTS -- (continued)
Class B --------------------------------------------- Year Year Year Year Year ended ended ended ended ended 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00* -------- -------- -------- -------- --------- Net Asset Value, Beginning of Period......... $ 9.33 $ 8.78 $ 9.03 $ 9.64 $ 9.98 Investment Operations: Net investment income (loss)................. 0.29@ 0.40@ 0.40@ 0.58@ 0.75 Net realized and unrealized gain (loss) on investments................................. 0.08 0.54 (0.26) (0.60) (0.33) ------- ------- ------- ------- ------- Total from investment operations............ 0.37 0.94 0.14 (0.02) 0.42 ------- ------- ------- ------- ------- Distributions: Dividends from net investment income......... (0.29) (0.39) (0.39) (0.59) (0.76) ------- ------- ------- ------- ------- Net Asset Value, End of Period............... $ 9.41 $ 9.33 $ 8.78 $ 9.03 $ 9.64 ------- ------- ------- ------- ------- Total Return(1).............................. 3.97% 10.95% 1.54% (0.41)% 4.61% Ratios/Supplemental Data Net assets, end of period ($000's)........... $27,530 $26,565 $31,906 $42,335 $50,966 Ratio of net expenses to average net assets.. 1.75% 1.54% 1.45% 1.45% 1.42% Ratio of net investment income to average net assets.................................. 3.04% 4.35% 4.42% 6.23% 7.85% Portfolio turnover rate...................... 24% 75% 112% 69% 41% Expense ratio before waiver of fees and reimbursement of expenses................... 2.38% 2.57% 2.51% 2.47% 2.31% Net investment income ratio before waiver of fees and reimbursement of expenses.......... 2.41% 3.33% 3.36% 5.21% 6.96%
- -------- @ Calculated based upon average shares outstanding. * The financial statements of the Fund for the period ended 12/31/00 were audited by other independent auditors whose report dated February 23, 2001 expressed an unqualified opinion on the statements. (1)Total return is not annualized and does not reflect sales load but does include expense reimbursements. See Notes to Financial Statements 8 SunAmerica Senior Floating Rate Fund, Inc. FINANCIAL HIGHLIGHTS -- (continued)
Class C ------------------------------------------------ Year Year Year Year Year ended ended ended ended ended 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00* -------- -------- -------- -------- --------- Net Asset Value, Beginning of Period................... $ 9.33 $ 8.78 $ 9.03 $ 9.64 $ 9.98 Investment Operations: Net investment income (loss)........................... 0.28@ 0.38@ 0.40@ 0.57@ 0.76 Net realized and unrealized gain (loss) on investments. 0.09 0.56 (0.27) (0.60) (0.33) -------- -------- ------- -------- -------- Total from investment operations...................... 0.37 0.94 0.13 (0.03) 0.43 -------- -------- ------- -------- -------- Distributions: Dividends from net investment income................... (0.29) (0.39) (0.38) (0.58) (0.77) -------- -------- ------- -------- -------- Net Asset Value, End of Period......................... $ 9.41 $ 9.33 $ 8.78 $ 9.03 $ 9.64 -------- -------- ------- -------- -------- Total Return(1)........................................ 3.97% 10.92% 1.47% (0.45)% 4.60% Ratios/Supplemental Data Net assets, end of period ($000's)..................... 174,583 $103,726 $86,101 $140,664 $227,662 Ratio of net expenses to average net assets............ 1.75% 1.59% 1.50% 1.50% 1.43% Ratio of net investment income to average net assets... 3.06% 4.22% 4.33% 6.28% 7.85% Portfolio turnover rate................................ 24% 75% 112% 69% 41% Expense ratio before waiver of fees and reimbursement of expenses........................................... 2.35% 2.51% 2.48% 2.52% 2.32% Net investment income ratio before waiver of fees and reimbursement of expenses............................. 2.46% 3.31% 3.36% 5.26% 6.96%
- -------- @ Calculated based upon average shares outstanding. * The financial statements of the Fund for the period ended 12/31/00 were audited by other independent auditors whose report dated February 23, 2001 expressed an unqualified opinion on the statements. (1)Total return is not annualized and does not reflect sales load but does include expense reimbursements. See Notes to Financial Statements 9 SunAmerica Senior Floating Rate Fund, Inc. FINANCIAL HIGHLIGHTS -- (continued)
Class D --------------------------------------- For the period Year Year Year 05/02/01* ended ended ended through 12/31/04 12/31/03 12/31/02 12/31/01 -------- -------- -------- -------------- Net Asset Value, Beginning of Period................................................. $ 9.33 $ 8.78 $ 9.03 $ 9.46 Investment Operations: Net investment income (loss)@........................................................ 0.33 0.43 0.43 0.35 Net realized and unrealized gain (loss) on investments............................... 0.08 0.54 (0.27) (0.42) ------- ------- ------- ------- Total from investment operations.................................................... 0.41 0.97 0.16 (0.07) ------- ------- ------- ------- Distributions: Dividends from net investment income................................................. (0.33) (0.42) (0.41) (0.36) ------- ------- ------- ------- Net Asset Value, End of Period....................................................... $ 9.41 $ 9.33 $ 8.78 $ 9.03 ------- ------- ------- ------- Total Return(1)...................................................................... 4.49% 11.28% 1.72% (0.79)% Ratios/Supplemental Data Net assets, end of period ($000's)................................................... $27,630 $13,369 $15,037 $26,372 Ratio of net expenses to average net assets.......................................... 1.25% 1.25% 1.25% 1.25%# Ratio of net investment income to average net assets................................. 3.60% 4.63% 4.58% 5.66%# Portfolio turnover rate.............................................................. 24% 75% 112% 69% Expense ratio before waiver of fees and reimbursement of expenses.................... 1.62% 1.86% 1.77% 2.27%# Net investment income ratio before waiver of fees and reimbursement of expenses...... 3.23% 4.02% 4.06% 4.64%#
- -------- * Inception date of class @ Calculated based upon average shares outstanding. # Annualized (1)Total return is not annualized and does not reflect sales load but does include expense reimbursements. See Notes to Financial Statements 10 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO PROFILE -- December 31, 2004 -- (unaudited) INDUSTRY ALLOCATION* Registered Investment Companies..................... 9.79% Healthcare, Education and Childcare................. 8.65% Broadcasting & Entertainment........................ 8.30% Automobile.......................................... 7.66% Containers, Packaging and Glass..................... 7.20% Chemicals, Plastics and Rubber...................... 7.08% Telecommunications.................................. 6.23% Beverage, Food & Tobacco............................ 5.84% Home and Office Furnishings, Housewares and Durables 4.77% Printing and Publishing............................. 4.09% Leisure, Amusement, Entertainment................... 3.57% Buildings & Real Estate............................. 3.47% Utilities........................................... 3.46% Electronics......................................... 3.19% Hotels, Motels, Inns and Gaming..................... 3.15% Retail Stores....................................... 2.96% Diversified/Conglomerate Manufacturing.............. 2.76% Personal and Nondurable Consumer Products........... 2.05% Diversified/Conglomerate Service.................... 1.92% Cargo Transport..................................... 1.47% Oil and Gas......................................... 1.36% Ecological.......................................... 0.86% Textiles and Leather................................ 0.66% Farming and Agriculture............................. 0.41% Mining, Steel, Iron and Nonprecious Metals.......... 0.41% Personal, Goods and Misc. Services.................. 0.36% ------ 101.67% ======
CREDIT QUALITY+# BBB............. 0.81% BBB-............ 0.24% BB+............. 10.12% BB.............. 15.53% BB-............. 14.41% B+.............. 30.47% B............... 15.01% B-.............. 5.87% CCC+............ 0.38% D............... 0.45% Not Rated@...... 6.71% ------ 100.00% ======
- -------- * Calculated as a percentage of Net Assets. @ Represents debt issues that either have no rating, or the rating is unavailable from the data source. + Source: Standard and Poors # Calculated as a percentage of total debt issues, excluding short-term securities. 11 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO OF INVESTMENTS -- December 31, 2004
Ratings/(1)/ ----------- Interest Maturity Principal Value Industry Description Type Moody's S&P Rate Date/(2)/ Amount (Note 2) - ------------------------------------------------------------------------------------------------------------------- LOANS/(3)(4) /-- 91.78% Automobile -- 7.66% AM General, LLC....................... BTL-B B1 B+ 6.57-6.99% 11/01/11 $1,000,000 $ 1,025,000 Collins & Aikman Products Co.......... Tranche B1 B1 B+ 6.34 9/01/11 816,667 819,389 Collins & Aikman Products Co.......... Revolver B1 B+ 5.99 9/01/09 347,953 349,693 Grand Vehicle Works Holding Corp.@.... 2nd Lien B3 B- 7.92 7/23/11 2,000,000 1,900,000 Grand Vehicle Works Holding Corp.@.... BTL-B B2 B+ 4.92-5.42 7/23/10 995,000 975,100 Intermet Corp.(6)..................... BTL-B Caa1 D 7.88-10.50 3/31/09 997,571 940,210 Key Automotive Group.................. BTL-B B1 BB- 5.20-7.25 6/25/09 1,802,131 1,829,163 Metaldyne Co., LLC.................... BTL-D B2 BB- 6.56 12/31/09 1,994,981 1,987,293 Plastech Engineered Products, Inc..... 2nd Lien B1 B 6.88 3/31/11 1,000,000 1,010,000 Polypore, Inc......................... BTL B1 B 4.67 11/12/11 1,194,000 1,211,910 Tenneco Automotive, Inc............... BTL-B B1 B+ 5.41 12/12/10 682,759 695,845 Tenneco Automotive, Inc............... BTL-B1 B1 B+ 5.28 12/17/10 310,345 316,293 TRW Automotive Acquisitions Corp...... BTL-A1 Ba2 BB+ 3.63 2/28/09 1,200,000 1,203,000 TRW Automotive Acquisitions Corp...... BTL-D1 Ba2 BB+ 4.13 2/28/11 1,035,451 1,045,288 TRW Automotive Acquisitions Corp...... BTL-E Ba2 BB+ 3.88 10/31/10 1,500,000 1,507,970 United Components, Inc................ BTL-C B1 BB- 4.78 6/30/10 773,333 783,967 ----------- 17,600,121 ----------- Beverage, Food and Tobacco -- 5.84% Atkins Nutritionals, Inc.............. 1st Lien B2 B+ 7.67 10/29/09 930,000 834,675 Atkins Nutritionals, Inc.............. 2nd Lien B3 B- 10.17 10/29/09 1,000,000 676,250 Commonwealth Brands, Inc.............. BTL B1 BB- 5.69 8/28/07 728,334 738,349 Dole Food Co., Inc.................... BTL-D Ba3 BB 4.31-6.50 9/28/08 158,516 161,389 Dole Food Co., Inc.................... Incremental BTL Ba3 BB 4.19-6.50 9/28/08 485,714 494,518 Dole Holding Co., LLC................. 2nd Lien B3 B 7.00 7/22/10 1,500,000 1,537,032 Keystone Foods Holdings, LLC.......... BTL Ba3 B+ 4.44-4.81 6/16/11 1,407,476 1,422,431 Merisant Co........................... BTL-B B1 B+ 4.88 1/11/10 747,129 750,865 Nash Finch Co. ....................... BTL B1 B+ 4.69 11/12/10 1,000,000 1,013,125 NBTY, Inc............................. BTL-C Ba2 BB 4.38 3/15/07 1,034,267 1,045,041 NeIIson Nutraceutical, Inc............ BTL B1 B+ 9.25 10/04/09 1,802,016 1,736,693 Pierre Foods, Inc..................... BTL-B B1 B+ 4.48 6/30/10 945,698 955,942 Pinnacle Foods Holdings............... Delay Draw B1 B+ 4.76 10/25/10 2,071,844 2,072,275 ----------- 13,438,585 ----------- Broadcasting and Entertainment -- 8.30% Cebridge Connections, Inc.@........... 1st Lien NR NR 5.24-7.50 2/23/09 694,750 696,053 Cebridge Connections, Inc.@........... 2nd Lien NR NR 8.00-8.60 2/23/10 1,290,250 1,290,250 Century Cable Holdings, LLC @(6)...... Discretionary BTL NR NR 7.25 12/31/09 2,500,000 2,483,855 Century -- TCI California, LP@(6)..... Revolver NR NR 5.25 12/31/07 1,000,000 999,375 Charter Communications Operating, LLC. BTL-B B2 B 5.38 4/27/11 2,487,500 2,492,681 DIRECTV Holdings, LLC................. BTL-B2 Ba2 BB 4.39-4.41 3/06/10 2,064,796 2,092,154 Insight Midwest Holdings, LLC......... BTL-B Ba3 BB+ 5.19 12/31/09 990,000 1,007,050 PANAMSAT Corp......................... BTL-B B1 BB+ 5.16 8/20/11 4,466,114 4,497,051 Sinclair Broadcast Group, Inc......... BTL-A Ba2 BB 4.17 6/30/09 2,750,000 2,768,906 Sinclair Broadcast Group, Inc......... BTL-C Ba2 BB 4.17 12/31/09 750,000 758,125 ----------- 19,085,500 ----------- Buildings & Real Estate -- 3.47% Builders Firstsource, Inc............. BTL-A B1 B+ 5.42 2/25/10 1,488,750 1,505,498 Crescent Real Estate Funding XII, LP.. BTL NR BB+ 4.53 1/12/06 509,078 514,010 General Growth Properties, Inc........ BTL-A Ba2 BB+ 4.53 11/12/07 2,500,000 2,502,273 General Growth Properties, Inc........ BTL-B Ba2 BB+ 4.53 11/12/08 1,000,000 1,004,006 PGT Industries, Inc.@................. BTL-A B1 B 5.13-5.42 1/29/10 971,000 986,172 Ply Gem Industries, Inc............... BTL B1 B+ 5.06-5.28 2/27/11 1,265,438 1,280,465 Ply Gem Industries, Inc............... CND TL B1 B+ 5.06-5.28 2/27/11 185,813 188,019 ----------- 7,980,443 -----------
12 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO OF INVESTMENTS -- December 31, 2004 -- (continued)
Ratings/(1)/ ----------- Interest Maturity Principal Value Industry Description Type Moody's S&P Rate Date/(2)/ Amount (Note 2) - ------------------------------------------------------------------------------------------------------------------ Cargo Transport -- 1.47% Moran Transportation Co.@.................... BTL B1 BB- 5.06% 8/08/09 $ 985,000 $ 996,081 Pacer International, Inc..................... BTL B1 BB- 4.06-5.06 6/10/10 1,207,843 1,225,206 United States Shipping, LLC.................. BTL Ba3 BB- 4.56 4/30/10 1,149,519 1,162,451 ----------- 3,383,738 ----------- Chemicals, Plastics and Rubber -- 7.08% Brenntag AG.................................. BTL-B2 B1 BB- 4.73 3/02/12 1,500,000 1,513,000 Celanese Americas Corp....................... BTL-C B2 B- 6.06 4/06/11 1,000,000 1,013,750 Celanese Americas Corp....................... BTL Ba3 B+ 4.81 4/06/11 997,500 1,008,722 Cognis Deutschland Eins GMBH................. 2nd Lien B2 B 7.22 11/15/13 1,500,000 1,560,625 Hercules, Inc................................ BTL-B Ba1 BB 3.97-4.31 10/08/10 893,250 900,508 Huntsman International, LLC.................. BTL-B B1 B 4.94 12/31/10 2,707,862 2,742,387 Kosa B.V..................................... BTL-B1 Ba3 BB 5.31 4/29/11 1,345,765 1,370,998 Kosa B.V..................................... BTL-B2 Ba3 BB 5.31 4/29/11 607,176 618,561 Resolution Specialty Materials, LLC.......... BTL NR B+ 5.13 8/02/10 2,000,000 2,033,126 Rockwood Specialties Group, Inc.............. BTL-D B1 B+ 4.38 7/30/12 2,000,000 2,015,468 Wellman, Inc................................. 2nd Lien B2 B- 8.91 2/10/10 1,000,000 1,003,333 Westlake Chemical Corp....................... BTL-B Ba1 BB+ 4.27-6.50 7/31/10 502,500 509,095 ----------- 16,289,573 ----------- Containers, Packaging and Glass -- 7.20% Appleton Papers, Inc......................... BTL Ba3 BB 4.33-4.79 6/11/10 1,119,375 1,133,647 Berry Plastics Corp.......................... BTL-C B1 B+ 4.22 7/22/10 1,306,907 1,324,877 Boise Cascade Corp........................... BTL-B Ba3 BB 4.47 10/28/11 1,756,688 1,780,232 Boise Cascade Corp........................... BTL-C Ba3 BB 4.47 10/29/10 1,618,313 1,623,931 Constar International, Inc.(5)............... BTL-B B2 BB- 7.06 11/20/09 812,937 832,584 Constar International, Inc................... Revolver B2 BB- 6.22 11/20/07 166,667 160,000 Constar International, Inc................... 2nd Lien B2 B 10.56 12/23/10 1,000,000 1,035,000 Graham Packaging Co., LP..................... Tranche B B2 B 4.88-6.25 10/07/11 2,500,000 2,537,053 Graphic Packaging International, Inc......... BTL-C B1 B+ 4.51-4.92 8/08/10 1,368,823 1,394,317 Owens-Illinois Group, Inc.................... BTL-A B1 BB- 4.95 4/01/07 684,735 697,788 Owens-Illinois Group, Inc.................... BTL-B1 B1 BB- 5.17 4/01/08 674,932 688,712 Precise Technology, Inc.@.................... 1st Lien B1 B+ 5.56 3/25/11 744,375 749,260 Precise Technology, Inc.@.................... 2nd Lien B2 B- 8.56 3/25/11 500,000 501,250 Ranpak Corp.@................................ BTL-B B3 B 6.15-12.00 5/26/10 770,993 771,957 Waddington North America, Inc.@.............. BTL-B B1 B 4.98-5.31 4/07/11 1,358,000 1,317,260 ----------- 16,547,868 ----------- Diversified/Conglomerate Manufacturing -- 2.76% Colfax Corp.@................................ BTL-B Ba3 BB- 4.81 5/30/09 675,000 681,750 Enersys Capital, Inc......................... BTL Ba3 BB 3.92-4.54 3/17/11 597,000 606,142 Invensys International Holdings, Ltd......... BTL-B1 Ba3 B+ 5.48 9/05/09 3,250,121 3,302,936 Invensys International Holdings, Ltd......... 2nd Lien B1 B- 6.76 12/05/09 1,712,329 1,763,699 ----------- 6,354,527 ----------- Diversified/Conglomerate Service -- 1.92% Bridge Information Systems, Inc. + @(7)...... BTL-B NR NR 4.00 5/29/05 521,115 23,450 Coinstar, Inc................................ BTL Ba3 BB- 4.29-6.50 7/07/11 883,374 898,833 lnfoUSA, Inc.@............................... BTL Ba3 BB 5.06 3/25/09 875,000 883,750 NES Rentals Holdings, Inc.................... 2nd Lien B3 B 8.35-10.25 6/30/09 1,496,250 1,507,472 Syniverse Holding, LLC....................... BTL-B Ba3 BB- 5.40-5.56 12/31/10 1,097,280 1,108,939 ----------- 4,422,444 ----------- Ecological -- 0.86% Allied Waste North America, Inc.............. BTL-B B1 BB 4.95-5.24 1/15/10 830,662 843,945 Allied Waste North America, Inc.............. BTL-D B1 BB 4.54 1/15/10 981,531 995,457 Allied Waste North America, Inc.............. Tranche A B1 BB 4.59 1/15/10 141,429 143,329 ----------- 1,982,731 -----------
13 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO OF INVESTMENTS -- December 31, 2004 -- (continued)
Ratings/(1)/ ------------ Interest Maturity Principal Value Industry Description Type Moody's S&P Rate Date/(2)/ Amount (Note 2) - --------------------------------------------------------------------------------------------------------------------------------- Electronics -- 3.19% Amkor Technology, Inc...................................... BTL B1 B+ 6.56% 10/27/10 $1,000,000 $ 1,045,417 Fairchild Semiconductor Corp............................... BTL Ba3 BB- 4.75 6/19/08 1,477,500 1,497,355 Seagate Technology Holdings, Inc........................... BTL-B Ba1 BB+ 4.31 5/13/07 1,402,806 1,427,136 UGS Corp................................................... BTL-B B1 B+ 4.67 5/27/11 1,791,000 1,821,223 VUTEk, Inc.@............................................... BTL B1 B+ 1.75 6/25/10 1,560,000 1,556,100 ----------- 7,347,231 ----------- Farming and Agriculture -- 0.41% AGCO Corp.................................................. BTL Ba1 BB+ 4.47-4.55 1/31/06 918,167 935,096 ----------- Healthcare, Education and Childcare -- 8.65% Accredo Health, Inc........................................ BTL-B Ba2 BB 4.23 6/30/11 1,492,500 1,504,627 Community Health Systems, Inc.............................. BTL Ba3 BB- 4.15 8/19/11 1,325,428 1,337,751 Concentra Operating Corp................................... BTL B1 B+ 4.88-5.10 6/30/10 992,512 1,003,264 Conmed Corp................................................ BTL-C Ba3 BB- 4.66-5.01 12/15/09 987,001 998,722 Connecticare Capital, LLC@................................. BTL B1 NR 6.17 10/30/09 887,500 891,937 Cooper Companies, Inc...................................... BTL-B Ba3 BB 4.19 11/15/11 1,000,000 1,014,687 Dade Behring, Inc.......................................... BTL-B Ba3 BB 4.31 10/03/08 348,129 349,869 Da Vita, Inc............................................... BTL-B Ba2 BB 3.98-4.78 3/31/09 1,967,677 1,974,880 Hanger Orthopedic Group, Inc............................... BTL-B B2 B 6.06 9/30/09 987,500 998,609 Insight Health Services Acquisition Corp................... BTL-B B1 B 6.31 10/17/08 967,487 976,255 Magellan Health Services, Inc.............................. BTL B1 B+ 4.74 8/15/08 472,222 479,010 Magellan Health Services, Inc.............................. LOC B1 B+ 1.72 8/15/08 277,778 281,771 Medco Health Solutions, Inc................................ BTL Ba1 BBB 2.76-3.72 3/26/09 1,696,429 1,708,444 Multiplan, Inc............................................. BTL NR B+ 5.31 3/04/09 1,333,333 1,348,333 Quintiles Transnational Corp............................... BTL B1 BB- 6.67-6.81 9/25/09 987,500 1,006,016 Team Health, Inc.@......................................... BTL-B NR B+ 5.81 3/23/11 1,985,000 1,993,684 Vanguard Health Systems, Inc............................... Tranche 1 B2 B 5.31 9/30/11 997,500 1,014,956 Youth and Family Centered Services, Inc.................... BTL-B B2 B+ 5.94-8.00 5/28/11 997,500 999,994 ----------- 19,882,809 ----------- Home and Office Furnishings, Housewares and Durables -- 4.77% Buhrmann U.S., Inc......................................... BTL-C1 Ba3 BB- 4.94 12/31/10 1,732,544 1,757,991 Hillman Group, Inc.@....................................... BTL-B B2 B 5.50-7.50 3/31/11 827,083 836,905 Holmes Group, Inc.......................................... 1st Lien B1 B 5.58-7.50 11/08/10 995,000 1,004,950 Holmes Group, lnc.......................................... 2nd Lien B3 CCC+ 9.83-9.98 5/06/11 500,000 505,000 Juno Lighting, Inc......................................... 1st Lien B1 B+ 4.37-6.75 11/21/10 2,213,447 2,245,265 Juno Lighting, Inc......................................... 2nd Lien B2 B- 7.44-7.85 5/21/11 1,000,000 1,016,250 Knoll, Inc................................................. BTL Ba3 BB- 5.34 9/30/11 1,383,529 1,399,527 Maax Corp.@................................................ BTL-B B1 B 4.79-7.00 6/04/11 1,194,000 1,205,940 Simmons Co................................................. Tranche C B2 B+ 3.88-6.75 12/19/11 979,259 992,724 ----------- 10,964,552 ----------- Hotels, Motels, Inns, and Gaming -- 3.15% Boyd Gaming Corp........................................... BTL-B Ba2 BB 3.92-4.53 6/30/11 663,333 673,035 CNL Hospitality Partners, LP............................... BTL Ba3 NR 5.33 10/13/06 1,000,000 1,016,250 Penn National Gaming....................................... BTL-D Ba3 BB- 4.92-5.06 9/01/07 371,884 373,557 Venetian Casino Resorts, LLC............................... Delay Draw B1 NR 4.90 6/15/11 3,238,636 3,298,687 Wyndham International, Inc................................. Revolver B1 B- 8.13-8.65 4/01/06 491,544 489,762 Wyndham International, Inc................................. BTL-1 B1 NR 7.13 6/30/06 1,393,552 1,402,698 ----------- 7,253,989 ----------- Leisure, Amusement, Entertainment -- 3.57% Affinity Group, Inc........................................ BTL-B1 Ba2 B+ 5.47-5.53 6/24/09 344,541 348,417 Affinity Group, Inc........................................ BTL-B2 Ba2 B+ 5.47 6/24/09 861,352 871,042 Metro-Goldwyn-Mayer Studios, Inc........................... BTL-B Ba3 B+ 5.06 4/30/11 1,995,000 2,003,479 Regal Cinemas, Inc......................................... BTL Ba3 BB- 4.56 11/10/10 1,443,523 1,459,222 Warner Music Group......................................... BTL-B B1 B+ 4.97-5.38 2/28/11 3,473,750 3,524,408 ----------- 8,206,568 -----------
14 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO OF INVESTMENTS -- December 31, 2004 -- (continued)
Ratings/(1)/ ------------ Interest Maturity Principal Value Industry Description Type Moody's S&P Rate Date/(2)/ Amount (Note 2) - --------------------------------------------------------------------------------------------------------------------- Mining, Steel, Iron and Nonprecious Metals -- 0.41% Headwaters, Inc.................................. 1st Lien B1 B+ 5.33% 4/30/11 $ 921,875 $ 934,935 ----------- Oil and Gas -- 1.31% ATP Oil & Gas Corp............................... 1st Lien NR NR 8.23-8.55 3/29/09 992,502 1,012,352 Tesoro Petroleum Corp............................ FATL Ba2 BBB- 7.90-7.99 4/15/08 485,000 500,035 Williams Production RMT Co.@..................... BTL-C B1 BB 4.99 5/30/08 1,477,575 1,502,202 ----------- 3,014,589 ----------- Personal and Nondurable Consumer Products -- 2.05% American Safety Razor Co......................... Tranche B B2 B 5.38-5.85 4/29/11 657,897 661,187 American Safety Razor Co......................... Tranche C B3 CCC+ 9.11 10/29/11 300,000 304,500 Church & Dwight Co., Inc......................... Tranche B Ba2 BB 4.17 5/30/11 1,134,197 1,148,730 Sealy Mattress Co................................ BTL-C B2 B+ 4.45-4.65 4/06/12 1,573,661 1,597,266 United Industries Corp........................... BTL B1 B+ 4.63-4.92 4/30/11 992,513 1,009,261 ----------- 4,720,944 ----------- Personal, Goods and Misc. Services -- 0.36% Domino's, Inc.................................... BTL Ba3 B+ 4.31 6/25/10 816,414 827,470 ----------- Printing and Publishing -- 4.09% Dex Media West, LLC.............................. BTL-B Ba2 BB- 4.10-6.00 3/09/10 1,226,440 1,240,110 Haights Crossing Operating Co.@.................. BTL B3 B- 6.78 8/20/08 1,478,775 1,515,744 Journal Register Co.............................. BTL Ba2 BB+ 3.42-3.76 8/12/12 1,000,000 1,001,875 Primedia, Inc.................................... BTL B3 B 6.69 12/31/09 1,592,000 1,607,920 R.H. Donnelly, Inc............................... BTL-D Ba3 BB 4.09-4.31 6/30/11 1,529,504 1,546,870 Transwestern Publishing Co....................... 1st Lien B1 B+ 3.94-6.25 2/25/11 955,053 967,588 Transwestern Publishing Co....................... BTL B1 B+ 4.56 2/25/11 1,500,000 1,519,688 ----------- 9,399,795 ----------- Retail Stores -- 2.96% Alimentation Couche-Tard, lnc.................... BTL Ba2 BB 4.19 12/17/10 607,653 616,388 American Achievement Corp........................ BTL-B B1 B+ 4.92-6.75 3/25/11 992,500 1,008,628 Educate Operating Co., LLC....................... BTL B1 B+ 5.06 3/30/11 1,398,243 1,415,721 General Nutrition Centers, Inc................... Tranche B B2 B 5.42 12/07/09 990,000 996,188 Jean Coutu Group, Inc............................ BTL-B B1 BB 4.44 7/30/11 1,496,250 1,520,564 Quality Stores (Central Tractor) +@#(6)(7)....... BTL-B Caa2 D 3.75 9/30/06 856,334 -- Weight Watchers International, Inc............... BTL-C Ba1 BB 3.77 3/31/10 1,246,875 1,256,747 ----------- 6,814,236 ----------- Telecommunications -- 6.18% Centennial Cellular Operating Co., LLC........... BTL-B B2 B- 4.92-5.38 2/09/11 1,488,750 1,510,151 Nexstar Broadcasting............................. BTL-D Ba3 B+ 4.31 12/31/10 2,493,743 2,504,653 Nextel Finance Co................................ BTL-E Ba1 BB+ 4.69 12/15/10 2,695,275 2,700,183 Ntelos, Inc...................................... BTL-B NR B 6.17 7/25/08 1,409,302 1,411,063 NTL Investment Holding, Ltd...................... BTL-B B1 BB- 5.20 4/30/12 2,000,000 2,020,000 Qwest Corp....................................... BTL-A Ba3 NR 7.39 6/30/07 1,000,000 1,044,167 Spectrasite Communications, Inc.................. BTL-B Ba3 BB- 4.03 5/19/12 2,000,000 2,015,416 Western Wireless Corp............................ BTL-B B2 B- 5.03-5.42 5/31/11 995,000 1,012,234 ----------- 14,217,867 ----------- Textiles and Leather -- 0.66% Globe Manufacturing Corp. +@#(7)................. BTL-B NR NR 2.75 7/15/06 837,014 -- Springs Industries, Inc.......................... BTL-B Ba3 BB+ 5.31 12/07/10 1,500,000 1,516,875 ----------- 1,516,875 -----------
15 SunAmerica Senior Floating Rate Fund, Inc. PORTFOLIO OF INVESTMENTS -- December 31, 2004 -- (continued)
Ratings/(1)/ ----------- Interest Maturity Principal Value Industry Description Type Moody's S&P Rate Date/(2)/ Amount/Shares (Note 2) - ---------------------------------------------------------------------------------------------------------------- Utilities -- 3.46% AES Corp............................... BTL Ba3 BB 4.25-4.44% 4/30/08 $ 1,423,571 $ 1,447,742 Allegheny Energy Supply Co............. BTL B1 B+ 5.01-5.16 3/08/11 1,123,370 1,143,871 Astoria Energy, LLC.................... 1st Lien Ba3 B+ 6.86-7.81 4/16/12 1,000,000 1,023,750 Calpine Corp.@......................... 2nd Lien NR B 7.82 12/31/07 2,468,750 2,257,363 La Grange Acquisition, LP.............. BTL Ba2 B+ 5.44 1/18/08 1,050,000 1,067,391 Reliant Energy Resources, Inc.......... BTL-B B1 B+ 4.80 4/30/10 1,000,000 1,013,854 ------------ 7,953,971 ------------ Total Loans (Cost $211,121,675)....................................... 211,076,457 ------------ COMMON STOCK -- 0.10% Oil and Gas -- 0.05% Shaw Group, Inc.+..................................................... 6,276 112,026 ------------ Telecommunications -- 0.05% Global Crossing, Ltd.+................................................ 175 3,175 SAVVIS Communications Corp.+.......................................... 89,386 103,688 ------------ 106,863 ------------ Total Common Stock (Cost $234,870).................................... 218,889 ------------ Total Long-Term Investment Securities (Cost $211,356,545)............. 211,295,346 ------------ SHORT-TERM INVESTMENT SECURITIES -- 9.79% Registered Investment Companies -- 9.79% SSgA Money Market Fund (Cost $22,516,667)............................. 22,516,667 22,516,667 ------------ TOTAL INVESTMENTS -- 101.67% (Cost $233,873,212)(8)................................................ 233,812,013 Liabilities in Excess of Other Assets -- (1.67%).......................... (3,844,483) ------------ NET ASSETS -- 100.00%..................................................... $229,967,530 ============
- -------- BTL Bank Term Loan CND TLCanadian Term Loan FATL Fixed Asset Term Loan LOC Line of Credit NR Security is not rated. + Non-income producing @ Illiquid security. At December 31, 2004, the aggregate value of these securities was $27,015,438, representing 11.75% of net assets. # Fair valued (see Note 2). (1) Bank loans rated below Baa by Moody's lnvestor Service, Inc. or BBB by Standard & Poor's Group are considered below investment grade. Ratings are unaudited. Ratings provided as of December 31, 2004. (2) Loans in the Fund's portfolio are generally 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 may occur. As a result, the actual remaining maturity may be substantially less than the stated maturities shown. The Fund estimates that the maturity of the Loans held in its portfolio will be approximately 63 months. (3) The Fund invests in Senior Loans which generally pay interest at rates which are periodically re-determined by reference to a base lending rate plus a premium. These base lending rates are generally either the lending rate offered by one or more major European banks, such as the London Inter-Bank Offer Rate ("LIBOR") or the prime rate offered by one or more major United States banks, or the certificate of deposit rate. Senior Loans are generally considered to be restrictive in that the Fund is ordinarily contractually obligated to receive approval from the Agent Bank and/or borrower prior to the disposition of a Senior Loan. (4) All loans in the portfolio were purchased through assignment agreements unless otherwise indicated. (5) Loan was purchased through a participation agreement. (6) Company has filed Chapter 11 bankruptcy. (7) Loan is in default of interest payment. (8) See Note 6 for cost of investments on a tax basis. See Notes to Financial Statements 16 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 Note 1. Organization of the Fund The SunAmerica Senior Floating Rate Fund, Inc. (the "Fund"), is a non-diversified closed-end, investment management company. The Fund is organized as a Maryland corporation and is registered under the Investment Company Act of 1940, as amended. The Fund is managed by AIG SunAmerica Asset Management Corp. (the "Adviser" or "SAAMCo"), an indirect wholly-owned subsidiary of American International Group, Inc. ("AIG"). The Fund's investment objective is to provide as high a level of current income as is consistent with the preservation of capital by investing primarily in senior secured floating rate loans. The Fund may offer four classes of shares. Class B shares are sold to the public at net asset value and are subject to an Early Withdrawal Charge which declines from 3% in the first year after purchase to zero after the fourth year. Class C shares are sold to the public at net asset value and are subject to an Early Withdrawal Charge of 1% in the first year after purchase. Class D shares are sold and repurchased at net asset value, and were issued to shareholders of the CypressTree Senior Floating Rate Fund upon its merger into the Fund on May 11, 2001. Class D shares are sold only to investors participating in a fee-based investment advisory program (wrap program) or agency commission program, or to current Class D shareholders. Class A shares are not currently offered, and are available only upon the conversion of Class B and C shares after being held by the shareholders for eight and ten years, respectively. The share classes differ in their respective distribution and service fees. All classes have equal rights to assets and voting privileges. Indemnifications: Under the Fund's organizational documents, its officers and directors are indemnified against certain liability arising out of the performance of their duties to the Fund. In addition, in the normal course of business the Fund enters into contracts that contain a variety of representations and warranties which provide general indemnifications. The Fund's maximum exposure under these arrangements are unknown as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund expects the risk of loss to be remote. Note 2. Significant Accounting Policies The preparation of financial statements in accordance with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from these estimates. The following is a summary of the significant accounting policies followed by the Fund in the preparation of its financial statements: Security Valuation: The Fund's investments in loan interests ("Loans") are valued in accordance with guidelines established by the Board of Directors. Under the Fund's current guidelines, Loans for which an active secondary market exists to a reliable degree in the subadviser's opinion will be valued at the mean of the last available bid and asked prices in the market for such Loans, as provided by a Board-approved loan pricing service. Loans for which an active secondary market does not exist to a reliable degree in the subadviser's opinion will be valued at fair value, which is intended to approximate market value. In valuing a Loan at fair value, the following factors will be considered, (a) the creditworthiness of the borrower and any intermediate participants, (b) the terms of the Loan, (c) recent prices in the market for similar Loans, if any, and (d) recent prices in the market for instruments of similar quality, rate, and period until next interest rate reset and maturity. Other portfolio securities may be valued on the basis of prices furnished by one or more pricing services that determine prices for normal, institutional-size trading units of such securities using market information, transactions for comparable securities and various relationships between securities which are generally recognized by institutional traders. In certain circumstances, other portfolio securities are valued at the last sale price on the exchange that is the primary market for such securities, or the last quoted bid price for those securities for which the over-the-counter market is the primary market or for listed securities in which there were no sales during the day. Securities listed on the NASDAQ exchange will be valued using the NASDAQ Official Closing Price ("NOCP"). Generally, the NOCP will be the last sale price unless the reported trade for the security is outside the range of the bid/ask price. In such cases, the NOCP will be normalized to the nearer of the bid or ask price. Securities for which market quotations are not readily available or if a development/event occurs that may significantly impact the value of a security, then these securities may be fair 17 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 -- (continued) valued as determined pursuant to procedures adopted in good faith by the Board of Directors (the "Directors"). Short-term investments which mature in less than 60 days are valued at amortized cost, if their original maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if their original term to maturity exceeded 60 days. The senior Loans in which the Fund primarily invests are generally not listed on any exchange and the secondary market for those senior Loans is comparatively illiquid relative to markets for other fixed income securities. Consequently, obtaining valuations for those Loans may be more difficult than obtaining valuations for actively traded securities. Thus, the value upon disposition on any given Loan may differ from its current valuation. Repurchase Agreements: The Fund may enter into repurchase agreements. When the Fund enters into a repurchase agreement through its custodian, it receives delivery of the underlying securities, the amount of which at the time of purchase and each subsequent business day is required to be maintained at such a level that the market value is equal to at least 102% of the resale price, and the Fund will take constructive receipt of all securities underlying the repurchase agreements until such agreements expire. If the seller defaults, the Fund would suffer a loss to the extent that proceeds from the sale of underlying securities were less than the repurchase price. At December 31, 2004, the Fund did not enter into any repurchase agreements. Securities Transactions, Investment Income, Expenses, Dividends and Distributions to Shareholders: Security transactions are recorded on a trade date basis. Realized gains and losses on sales of investments are calculated on the identified cost basis. Interest income is accrued daily except when collection is not expected. Dividend income is recorded on the ex-dividend date. For financial statement purposes, the Fund amortizes all premiums and accretes all discounts. Facility fees received, which were $307,440 for the period ended December 31, 2004, are amortized as income over the stated life of the Loans. Other income, including amendment fees, commitment fees, letter of credit fees, etc., which were $380,528 for the period ended December 31, 2004, are recorded as income when received or contractually due to the Fund. Net investment income, other than class-specific expenses, and realized and unrealized gains and losses, are allocated daily to each class of shares based upon the relative net asset value of outstanding shares of each class of shares at the beginning of the day (after adjusting for the current capital share activity of the respective class). Interest earned on cash balances held at the custodian are shown as custody credits on the statement of operations. Dividends from net investment income are accrued daily and paid monthly. Capital gain distributions, if any, are paid annually. The Fund records dividends and distributions to the shareholders on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations, which may differ from U.S. generally accepted accounting principles. These "book/tax" differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts at fiscal year end based on their federal tax-basis treatment; temporary differences do not require reclassification. Net investment income/loss, net realized gain/loss, and net assets are not affected. The Fund intends to comply with the requirements of the Internal Revenue Code, as amended, applicable to regulated investment companies and distribute all of its taxable income, including any net realized gain on investments, to its shareholders. Therefore, no federal tax provision is required. Statement of Cash Flows: Information on financial transactions which have been settled through the receipt or disbursement of cash is presented in the Statement of Cash Flows. The cash amount shown in the Statement of Cash Flows is the amount included in the Fund's Statement of Assets and Liabilities and represents cash on hand at its custodian bank account, and does not include any short-term investments at December 31, 2004. 18 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 -- (continued) Note 3. Capital Share Transactions The Fund has 1,000,000,000 of $.01 par value shares authorized that may be issued in four different classes. Transactions in capital shares of each class were as follows:
For the period April 28, 2004**- December 31, 2004 ------------------------- Shares Amount Class A ---------- ------------ Shares sold................. 23,650* $ 222,806* Reinvested distributions.... 391 3,681 Shares repurchased.......... (202) (1,902) ---------- ------------ Net increase (decrease).. 23,839 $ 224,585 ========== ============ For the For the year ended year ended December 31, 2004 December 31, 2003 ------------------------- ------------------------ Shares Amount Shares Amount Class B ---------- ------------ ---------- ------------ Shares sold................. 649,863 $ 6,108,232 302,522 $ 2,767,847 Reinvested distributions.... 60,214 566,344 85,439 772,401 Shares repurchased.......... (633,762)* (5,961,214)* (1,171,973) (10,584,805) ---------- ------------ ---------- ------------ Net increase (decrease).. 76,315 $ 713,362 (784,012) $ (7,044,557) ========== ============ ========== ============ For the For the year ended year ended December 31, 2004 December 31, 2003 ------------------------- ------------------------ Shares Amount Shares Amount Class C ---------- ------------ ---------- ------------ Shares sold................. 11,042,355 $103,837,676 4,140,154 $ 38,020,342 Reinvested distributions.... 300,723 2,828,393 276,003 2,497,941 Shares repurchased.......... (3,917,703) (36,835,107) (3,097,227) (27,885,351) ---------- ------------ ---------- ------------ Net increase (decrease).. 7,425,375 $ 69,830,962 1,318,930 $ 12,632,932 ========== ============ ========== ============ For the For the year ended year ended December 31, 2004 December 31, 2003 ------------------------- ------------------------ Shares Amount Shares Amount Class D ---------- ------------ ---------- ------------ Shares sold................. 1,986,376 $ 18,679,110 182,414 $ 1,684,560 Reinvested distributions.... 59,527 559,853 54,475 492,983 Shares repurchased.......... (544,090) (5,117,136) (515,575) (4,658,230) ---------- ------------ ---------- ------------ Net increase (decrease).. 1,501,813 $ 14,121,827 (278,686) $ (2,480,687) ========== ============ ========== ============
- -------- * Includes automatic conversion of 13,025 shares of Class B shares in the amount of $122,726 to 13,025 shares of Class A shares in the amount of $122,726. ** Inception date of class. In order to provide shareholders with liquidity and the ability to receive net asset value on a disposition of shares, the Fund will make monthly offers to repurchase a percentage (usually 10%) of outstanding shares at net asset value. Shareholders are sent a Notification of Repurchase Offer seven to fourteen days before each monthly repurchase offer. During the period ended December 31, 2004, the Fund made twelve Repurchase Offers, and redeemed the amounts shown in the table below. In no case was a monthly Repurchase Offer oversubscribed.
Amount Tendered Amount Tendered ------------------ - ------------------ Shares Amount Shares Amount ------- ---------- - ------- ---------- January. 267,200 $2,511,843 July..... 319,980 $3,014,260 February 371,990 3,493,081 August... 735,985 6,910,581 March... 327,789 3,077,932 September 669,183 6,283,631 April... 262,610 2,476,436 October.. 402,791 3,786,141 May..... 244,062 2,297,155 November. 331,103 3,115,673 June.... 455,190 4,287,520 December. 707,874 6,661,106
19 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 -- (continued) Note 4. Purchases And Sales Of Securities During the period ended December 31, 2004, the Fund's cost of purchases of Loans and proceeds from Loan sales were $236,656,917 and $41,929,953, respectively. Note 5. Investment Advisory Agreement And Other Transactions With Affiliates The Fund currently maintains an Investment Advisory Agreement with SAAMCo, who is responsible for managing the corporate and business affairs of the Fund, and selects, contracts with and compensates the subadviser to manage the Fund's assets. The Fund will pay SAAMCo a monthly advisory fee at the following annual rates, based on the average daily net assets of the Fund: 0.85% on the first $1 billion; 0.80% on the next $1 billion; and 0.75% thereafter. For the period ended December 31, 2004, SAAMCo received advisory fees in the amount of $1,663,171. Stanfield Capital Partners, LLC ("Stanfield") acts as sub-adviser to the Fund pursuant to a Subadvisory Agreement with SAAMCo. Under the Subadvisory Agreement, Stanfield manages the investment and reinvestment of the Fund's assets. As compensation for its services as subadviser, Stanfield is entitled to receive from SAAMCo an annual fee paid monthly equal to the following percentage of average daily net assets: 0.25% for the first $1 billion of average daily net assets; 0.20% for average daily net assets of more than $1 billion. Stanfield received $489,192 as compensation for its services. The fee paid to the subadviser is paid by SAAMCo. SAAMCo also serves as the Fund's Administrator under an Administration Agreement and is responsible for managing the Fund's business affairs, subject to supervision by the Fund's Board of Directors. For its services, SAAMCo receives an annual fee equal to 0.40% of average daily net assets of the Fund. For the period ended December 31, 2004 SAAMCo received administrator fees in the amount of $781,306. The Fund has adopted Distribution Plans ("Plans") applicable to Class A, Class B and C shares to use the assets attributable to that class of shares of the Fund to finance certain activities relating to the distribution of shares to investors. The Plans are compensation plans providing for the payment to AIG SunAmerica Capital Services, Inc. ("SACS"), of a fixed percentage of 0.50% of average net assets to finance distribution expenses for Class B and Class C, and 0.25% of average net assets to finance service fees for Class A, Class B and Class C. For the period ended December 31, 2004 SACS received distribution fees and early withdrawal charges on redemptions in the amount of $1,314,409 and $104,047, respectively. For the period ended December 31, 2004 SACS voluntarily waived fees for the following classes: Class A $94, Class B $67,668, Class C $370,650. Pursuant to the Investment Advisory Agreement, the Adviser voluntarily waived the advisory fee and reimbursed expenses in order to maintain an expense ratio on the Fund that did not exceed a certain voluntary rate. The rates are 1.45% for Class A, 1.75% for Class B and Class C, and 1.25% for Class D. For the period ended December 31, 2004, the Adviser waived fees and reimbursed expenses for the following classes: Class A $10,551, Class B $104,179, Class C $509,341, and Class D $74,451. 20 0 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 -- (continued) Note 6. Federal Income Taxes The following details the tax basis distributions as well as the components of distributable earnings. The tax basis components of distributable earnings differ from the amounts reflected in the Statement of Assets and Liabilities by temporary book/tax differences primarily arising from retirement pension expense, dividends payable and treatment of defaulted securities.
Distributable Earnings Tax Distributions - ---------------------------------------- ------------------------------------------------------------------------- For the year ended December 31, 2004 For the year ended December 31, 2004 For the year ended December 31, 2003 - ---------------------------------------- ------------------------------------ ------------------------------------ Long-term Gains/ Unrealized Long-term Long-term Ordinary Capital Loss Appreciation Ordinary Capital Ordinary Capital Income Carryover (Depreciation) Income Gains Income Gains - -------- ---------------- -------------- ---------- --------- ---------- --------- $ -- $(27,711,461) $(61,545) $6,107,401 $ -- $5,563,653 $ --
Capital Loss Carryforwards. At December 31, 2004 capital loss carryforwards available to offset future recognized gains were $27,711,461, with $9,669 expiring in 2005, $334,309 expiring in 2007, $1,179,134 expiring in 2008, $9,997,029 expiring in 2009, $7,736,363 expiring in 2010, $4,956,144 expiring in 2011, and $3,498,813 expiring in 2012. Unrealized appreciation and depreciation in the value of investments at December 31, 2004 for federal income tax purposes were as follows: Gross unrealized appreciation............................... $ 2,472,828 Gross unrealized depreciation............................... (2,534,373) ----------- Net unrealized depreciation................................. $ (61,545) ===========
Note 7. Director Retirement Plan The Directors of the SunAmerica Senior Floating Rate Fund, Inc. have adopted the AIG SunAmerica Disinterested Trustees' and Directors' Retirement Plan ("Retirement Plan") for the unaffiliated Directors. The Retirement Plan provides generally that if an unaffiliated Director who has at least 10 years of consecutive service as a Disinterested Director of any of the AIG SunAmerica mutual funds (an "Eligible Director") retires after reaching age 60 but before age 70, or who has at least 5 years of consecutive service after reaching age 65 but before age 70, or dies while a Director, such person will be eligible to receive a retirement or death benefit from each AIG SunAmerica mutual fund with respect to which he or she is an Eligible Director. As of each birthday, prior to the 70th birthday, but in no event for a period greater than 10 years, each Eligible Director will be credited with an amount equal to 50% of his or her regular fees (excluding committee fees) for services as a Disinterested Director of each AIG SunAmerica mutual fund for the calendar year in which such birthday occurs. In addition, an amount equal to 8.50% of any amounts credited under the preceding clause during prior years, is added to each Eligible Director's account until such Eligible Director reaches his or her 70th birthday. An Eligible Director may elect to receive any benefits payable under the Retirement Plan, at his or her election either in one lump sum or in up to fifteen annual installments. Any undistributed amounts continue to accrue interest at 8.50% per year. As of December 31, 2004, the Fund had accrued $7,517 for the Retirement Plan, which is included in Directors' fees and expenses on the Statement of Assets and Liabilities and for the period ended December 31, 2004, expensed $3,916 for the Retirement Plan, which is included in Directors' fees and expenses on the Statement of Operations. Note 8. Line of Credit The Fund currently has an agreement with State Street Bank & Trust Company that provides a $20,000,000 committed unsecured Line of Credit to the Fund which will be used for cash overdraft protection. Interest is currently payable at the Federal Funds rate plus 50 basis points. There is also a commitment fee of 10 basis points per annum on the daily unused portion of the line of credit which is included in interest expense on the Statement of Operations. During the period ended December 31, 2004, the Fund had borrowings outstanding for 3 days under the line of credit and incurred $109 in interest charges related to these borrowings. The Fund's average amount of debt under the line of credit for the days utilized was $837,565 at a weighted average interest of 1.56%. At December 31, 2004, there were no borrowings outstanding. 21 SunAmerica Senior Floating Rate Fund, Inc. NOTES TO FINANCIAL STATEMENTS -- December 31, 2004 -- (continued) Note 9. Interfund Leading Agreement Pursuant to the exemptive relief granted by the Securities and Exchange Commission, the Fund is permitted to participate in an interfund lending program among investment companies advised by SAAMCo or an affiliate. The interfund lending program allows the participating funds to borrow money from and lend money to each other for temporary or emergency purposes. An interfund loan will be made under this facility only if the participating Funds receive a more favorable interest rate than would otherwise be available from a typical bank for a comparable transaction. For the period ended December 31, 2004, the Fund did not participate in this program. Note 10. Senior Loan Participation Commitments The Fund invests primarily in participations and assignments, or acts as a party to the primary lending syndicate of a Variable Rate Senior Loan interest to United States corporations, partnerships, and other entities. If the lead lender in a typical lending syndicate becomes insolvent, enters receivership or, if not FDIC insured, enters into bankruptcy, the Fund may incur certain costs and delays in receiving payment, or may suffer a loss of principal and/or interest. When the Fund purchases a participation of a Senior Loan interest, the Fund typically enters into a contractual agreement with the lender or other third party selling the participation, but not with the borrower directly. As such, the Fund assumes the credit risk of the Borrower, Selling Participant or other persons positioned between the Fund and the Borrower. Note 11. Unfunded Loan Commitments On December 31, 2004, the Fund had the following unfunded loan commitments which could be extended at the option of the Borrower:
Maturity Name Type Date Amount - ---- ---------------------- -------- ---------- Boise Cascade Corp...................... Revolver 06/30/05 $2,500,000 Constar International, Inc.............. Revolver 11/20/07 833,333 United States Shipping, LLC............. Delayed Draw Term Loan 03/30/10 346,154 Venetian Casino Resorts, LLC............ Delayed Draw Term Loan 06/15/11 511,364 Venetian Casino Resorts, LLC............ Term Loan 08/20/09 1,250,000 Warner Music Group...................... Revolver 02/28/11 500,000 Wyndham International, Inc.............. Revolver 04/01/06 357,962
Note 12. Subsequent Events Effective December 31, 2004, Stanfield Capital Partners, LLC is no longer the sub-adviser for the Fund. On December 20, 2004, effective January 1, 2005, the Fund's Board of Directors approved an interim sub-advisory agreement between AIG SunAmerica Asset Management Corp. (SAAMCo) and American International Group Global Investment Corp. ("AIGGIC"). AIGGIC is an indirect "wholly-owned" subsidiary of AIG and an affiliate of SAAMCO. On January 12, 2005, the Board of Directors approved a new sub-advisory agreement between SAAMCo and AIGGIC subject to approval by the shareholders of the Fund at a special meeting of shareholders to be held on March 31, 2005. 22 SunAmerica Senior Floating Rate Fund, Inc. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of the SunAmerica Senior Floating Rate Fund, Inc.: In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations, of changes in net assets and of cash flows and the financial highlights present fairly, in all material respects, the financial position of the SunAmerica Senior Floating Rate Fund, Inc. (the "Fund") at December 31, 2004, 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 four years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with 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 are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at December 31, 2004 by correspondence with the custodian and selling or agent banks, provide a reasonable basis for our opinion. The financial statements of the Fund for the year ended December 31, 2000 were audited by other independent accountants whose report dated February 23, 2001 expressed an unqualified opinion on those statements. PricewaterhouseCoopers LLP Houston, Texas February 22, 2005 23 SunAmerica Senior Floating Rate Fund, Inc. DIRECTORS AND OFFICERS INFORMATION -- December 31, 2004 -- (unaudited) The following table contains basic information regarding the Directors and Officers that oversee operations of the Fund and other investment companies within the Fund complex.
Number of Position Held Term of Funds in Name, With Office and Fund Complex Address and SunAmerica Length of Principal Occupations Overseen by Date of Birth* Complex Time Served(4) During Past 5 Years Director(1) - ---------------------- ------------- -------------- ------------------------------------- ------------ Dr. Judith L. Craven Director 2000- Retired. 76 DOB: October 6, 1945 present William F. Devin Director 1998- Retired. 76 DOB: December 30, 1938 present Samuel M. Eisenstat Director 2001- Attorney, solo practitioner. 46 DOB: March 7, 1940 present Stephen J. Gutman Director 2001- President and Member of Managing 46 DOB: May 10, 1943 present Directors, Beau Brummell-Soho, LLC (licensing of menswear specialty retailing and other activities) (June 1988 to present). Peter A. Harbeck(3) Director 2001- President, CEO and Director, AIG 85 DOB: January 23, 1954 present SunAmerica Asset Management Corp. ("SAAMCo") (August 1995 to present); Director, AIG SunAmerica Capital Services, Inc. ("SACS") (August 1993 to present). William J. Shea(5) Director 2004- President and CEO, Conseco, Inc. 46 DOB: February 9, 1948 present (Financial Services) (2001 to 2004); Chairman of the Board of Centennial Technologies, Inc. (1998 to 2001); Vice Chairman, Bank Boston Corporation (1993 to 1998). Vincent M. Marra President 2004- Senior Vice President and Chief N/A DOB: May 28, 1950 present Operating Officer, SAAMCo (February 2003 to Present); Chief Administrative Officer and Chief Financial Officer, Carret & Co., LLC (June 2002 to February 2003); President, Bowne Digital Solutions (1999 to May 2002). Donna M. Handel Treasurer 2002- Assistant Treasurer (2001 to 2002); N/A DOB: June 25, 1966 present Senior Vice President, SAAMCo (December 2004-Present); Vice President, SAAMCo (August 1997 to December 2004).
Name, Address and Other Directorships Date of Birth* Held by Director(2) - ---------------------- ----------------------------------- Dr. Judith L. Craven Director, A.G. Belo Corporation DOB: October 6, 1945 (1992 to present); Director, Sysco Corporation (1996 to present); Director, Luby's Inc. (1998 to present); Director, University of Texas Board of Regents (2001-Present). William F. Devin Member of the Board of Governors, DOB: December 30, 1938 Boston Stock Exchange (1985- Present). Samuel M. Eisenstat Director of North European Oil DOB: March 7, 1940 Royalty Trust. Stephen J. Gutman None DOB: May 10, 1943 Peter A. Harbeck(3) None DOB: January 23, 1954 William J. Shea(5) None DOB: February 9, 1948 Vincent M. Marra N/A DOB: May 28, 1950 Donna M. Handel N/A DOB: June 25, 1966
- -------- * The business address for each Director and Officer is the Harborside Financial Center, 3200 Plaza 5, Jersey City, NJ 07311-4992. (1) The "Fund Complex" consists of all registered investment company portfolios for which SAAMCo serves as investment adviser or business manager. The "Fund Complex" includes the SunAmerica Money Market Funds (2 funds), SunAmerica Equity Funds (9 funds), SunAmerica Income Funds (6 funds), SunAmerica Focused Series, Inc. (15 portfolios), Anchor Series Trust (9 portfolios), SunAmerica Senior Floating Rate Fund, Inc. (1 fund), SunAmerica Series Trust (32 portfolios), AIG Series Trust (4 funds), VALIC Company I (24 portfolios), VALIC Company II (15 funds) and Seasons Series Trust (24 portfolios). (2) Directorships of companies required to report to the Securities and Exchange Commission under the Securities Exchange Act of 1934 (i.e. "public companies") or other investment companies registered under the Investment Company Act of 1940. (3) Interested Director, as defined in the Investment Company Act of 1940, because he is an officer and director of the adviser and a director of the principal underwriter of the Fund. (4) Directors serve until their successors are duly elected and qualified, subject to the Board's retirement plan discussed in Note 7 of the financial statements. (5) Effective on November 30, 2004, William J. Shea began serving as a Director. Additional information concerning the Directors and Officers is contained in the Statement of Additional Information and is available without charge by calling (800) 858-8850. 24 SunAmerica Senior Floating Rate Fund If you would like additional information: [_] Call FastFacts -- our 24-hour, automated account and fund information hotline at 800-654-4760. [_] Visit www.sunamericafunds.com for more up-to-date information. Thank you for your continued support. AIG SunAmerica Mutual Funds 25 [LOGO] AIG Sun America Mutual Funds AIG SunAmerica Asset Management Corp. Harborside Financial Center 3200 Plaza 5 Jersey City, NJ 07311-4992 Directors Investment Adviser DISCLOSURE OF QUARTERLY Dr. Judith L. Craven PORTFOLIO HOLDINGS William F. Devin AIG SunAmerica Asset Management Corp. The Fund is required to Samuel M. Eisenstat Harborside Financial file its com-plete Stephen J. Gutman Center schedule of portfolio Peter A. Harbeck 3200 Plaza 5 holdings with the William J. Shea Jersey City, NJ Securities and Exchange 07311-4992 Commission for its first Officers and third fiscal quarters Vincent M. Marra, Distributor on Form N-Q for fiscal President AIG SunAmerica Capital quar-ters ending after Donna M. Handel, Services, Inc. July 9, 2004. Once filed, Treasurer Harborside Financial the Fund's Form N-Q will Thomas Lynch, Assistant Center be available without Secretary 3200 Plaza 5 charge on the Secu-rities J. Steven Neamtz, Vice Jersey City, NJ and Exchange Commission's President 07311-4992 website at www.sec.gov. Gregory R. Kingston, You can also obtain Vice President and Shareholder Servicing copies of Form N-Q by (i) Assistant Treasurer Agent visit-ing the Securities Cynthia A. Gibbons, Vice AIG SunAmerica Fund and Exchange President and Chief Services, Inc. Com-mission's Public Compliance Officer Harborside Financial Reference Room in Kathryn A. Pearce, Center Washington DC Assistant Treasurer 3200 Plaza 5 (information on the Jersey City, NJ operation of the Public 07311-4992 Reference Room may be obtained by calling Custodian and Transfer 1-800-SEC-0330); (ii) Agent sending your re-quest and State Street Bank and a duplicating fee to the Trust Company Securities and Exchange P.O. Box 219373 Commission's Public Kansas City, MO 64141 Reference Room, Washington, DC 20549-0102 VOTING PROXIES ON FUND or (iii) sending your PORTFOLIO SECURITIES request electronically to A description of the publicinfo.sec.gov. policies and proce-dures that the Fund uses to PROXY VOTING RECORD ON determine how to vote FUND PORTFOLIO SECURITIES proxies relating to Information regarding how secu-rities held in the the Fund voted proxies Fund's portfolio which is related to securities available in the Fund's held in the Fund's State-ment of Additional portfolio during the Information, may be twelve month period ended obtained without charge June 30, 2004 is upon re-quest, by calling available (i) without (800) 858-8850. This charge, upon request, by information is also calling (800) 858-8850 or available from the EDGAR (ii) on the Securities database on the and Ex-change Securities and Exchange Commission's website at Commission's website at http://www.sec.gov. http://www.sec.gov. This report is submitted solely for the general information of shareholders of the Fund. Distribution of this report to persons other than shareholders of the Fund is authorized only in connection with a currently effective prospectus, setting forth details of the Fund which must precede or accompany this report.
26 [LOGO] AIG Sun America Mutual Funds Distributed by: AIG SunAmerica Capital Services, Inc. SFANN-12/04 Item 2. Code of Ethics. The SunAmerica Senior Floating Rate Fund, Inc. ("the registrant") has adopted a Code of Ethics applicable to its Principal Executive and Principal Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley Act of 2002. Effective December 2, 2004, the Code of Ethics has been amended to reflect Vincent M. Marra as President, replacing Robert M. Zakem. Item 3. Audit Committee Financial Expert. Currently, the registrant does not have an Audit Committee member who possesses all of the attributes required to be an "audit committee financial expert" as defined in instruction 2(b)of Item 3 of Form N-CSR. However, the Board of Directors believes that each member of the Audit Committee has substantial experience relating to the review of financial statements and the operations of audit committees. Accordingly, the Board believes that the members are qualified to evaluate the registrant's financial statements, supervise the registrant's preparation of its financial statements, and oversee the work of the registrant's independent auditors. Item 4. Principal Accountant Fees and Services. (a)--(d) Aggregate fees billed to the registrant for the last two fiscal years for professional services rendered by the registrant's principal accountant were as follows: 2003 2004 ---- ---- Audit Fees ................... $58,592 $65,637 Audit-Related Fees ........... $26,095 $22,138 Tax Fees ..................... $ 8,705 $ 8,650 All Other Fees ............... $ 0 $ 0 Audit Fees include amounts related to the audit of the registrant's annual financial statements and services normally provided by the principal accountant in connection with statutory and regulatory filings. Audit-Related Fees principally include a SAS No. 100 review of the registrant's Semiannual Shareholder Report. Tax Fees principally include tax compliance, tax advice, tax planning and preparation of tax returns. (e) (1) The registrant's audit committee pre-approves all audit services provided by the registrant's principal accountant for the registrant and all non-audit services provided by the registrant's principal accountant for the registrant, its investment adviser and any entity controlling, controlled by, or under common control with the investment adviser ("Adviser Affiliate") that provides ongoing services to the registrant, if the engagement by the investment adviser or Adviser Affiliate relates directly to the operations and financial reporting of the registrant. (2) No services included in (b) - (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. (f) Not Applicable. (g) The aggregate fees billed for the most recent fiscal year and the preceding fiscal year by the registrant's principal accountant for non-audit services rendered to the Registrant, its investment adviser, and Adviser Affiliate that provides ongoing services to the registrant for 2004 and 2003 were $1,817,631 and $636,504, respectively. (h) Non-audit services rendered to the registrant's investment adviser and any Adviser Affiliate that were not pre-approved pursuant to Paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X were considered by the registrant's audit committee as to whether they were compatible with maintaining the principal accountant's independence. Item 5. Audit Committee of Listed Registrants. Not applicable. Item 6. Schedule of Investments. Not applicable. Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. PROXY VOTING POLICIES AND PROCEDURES Proxy Voting Responsibility. The Corporation have adopted policies and procedures for the voting of proxies relating to portfolio securities. The policies and procedures were drafted according to recommendations by a proxy voting committee composed of senior management of the Corporation and the Corporation's investment adviser. The policies and procedures enable the Corporation to vote proxies in a manner consistent with the best interests of the Corporation's shareholders. The Corporation has retained a proxy voting service, the Investor Responsibility Research Center (the "IRRC"), to effect votes on behalf of the Corporation according to the Corporation's policies and procedures, and to assist the Corporation with recordkeeping of proxy votes. Except as otherwise described below regarding case-by-case voting matters and when conflicts of interest arises, neither SunAmerica nor any subadviser has discretion concerning proxy voting decisions. Company Management Recommendations. When determining whether to invest in the securities of a particular company, one of the key factors the portfolio manager considers is the quality and depth of the company's management. In holding portfolio securities, the Corporation is seeking to maximize the investment value for shareholders, but not necessarily exercise control over the issuers of portfolio securities or otherwise advance a particular social agenda. The Corporation's policies and procedures therefore provide that the Corporation will generally vote in support of management recommendations on most corporate matters. When a Corporation's portfolio manager is dissatisfied with a company's management, the Corporation typically will sell the holding. Case-By-Case Voting Matters. The policies and procedures identify certain voting matters that will be decided on a case-by-case basis. In these circumstances, the Corporation may request guidance or a recommendation from the proxy voting committee, the portfolio manager or other appropriate personnel of SunAmerica and/or the subadviser of a Portfolio. In these instances, such person(s) will recommend the vote that will maximize value for and is in the best interests of the Corporation's shareholders. Examples of the Corporation's Positions on Voting Matters. Consistent with the approaches described above, the following are examples of the Corporation's voting positions on specific matters: . Vote with management recommendations on most corporate matters; . Vote with management recommendations on proposals to increase or decrease authorized common stock; . Vote against the authorization of preferred stock if the Corporation's board has unlimited rights to set the terms and conditions of the shares; . Vote for a management proposal to decrease authorized preferred stock or cancel a class or series of preferred stock; . Vote on a case-by-case basis regarding finance, merger and acquisition matters; . Vote against most shareholder proposals; . Abstain from voting on social responsibility or environmental matters, unless the fund's objective is directly related to the social or environmental matter in question;/1/ . Not vote proxies for index funds/portfolios and passively managed funds/portfolios;/2/ and . May vote in favor of or against proposals relating to stock option plans and other management compensation issues depending on the details of the plan. Conflicts of Interest. Senior management of the Corporation and SunAmerica, including members of the proxy voting committee and legal and compliance personnel, and/or a subadviser, will resolve conflicts of interest presented by a proxy vote. In practice, application of the Corporation's proxy voting policies and procedures will in most instances adequately address any possible conflicts of interest, as the policies and procedures were pre-determined by the proxy voting committee, and votes are effected according to the policies and procedures by the IRRC, an independent third party. Also, the proxy voting committee consists of members who are not involved in marketing or other business units that may be likely to present conflicts. However, if a situation arises where a vote presents a conflict between the interests of the Corporation's shareholders and the interests of SunAmerica, the Corporation's principal underwriter, or one of SunAmerica's or the underwriter's affiliates, and the conflict is known to the Corporation, senior management of the Corporation and SunAmerica, including the proxy voting committee, will be consulted. Any Individual with a known conflict may be required by the proxy voting committee to recuse himself or herself from being involved in the proxy voting decision. Senior management, including the proxy voting committee, will evaluate the situation and ensure that the Corporation selects the vote that is in the best interests of the Corporation's shareholders. Proxy Voting Records. The IRRC will maintain records of voting decisions for each vote cast on behalf of the Corporation. Pursuant to SEC requirements, beginning in August of 2004, on an annual basis the Corporation will make available on its website its proxy voting record for the one-year period ending on June 30th. The proxy voting record will also be available on the SEC's website at http://www.sec.gov. - ---------- /1/ In these circumstances, the fund will consider the effect that the vote's outcome may have on the issuing company and the value of its securities as part of the fund's overall investment evaluation of whether to retain or sell the company's securities. The fund will either retain or sell the securities according to the best interests of the fund's shareholders. /2/ The Board of Directors has determined that the costs of voting proxies for index and passively managed funds will generally outweigh any benefits that may be achieved by voting such proxies because the outcome will not directly affect whether the fund retains a particular security. That is, the fund will retain or sell a particular security based on objective, rather than subjective, criteria. For example, in the case of an index fund, the fund will make a determination to retain or sell a security based on whether the index retains or deletes the security. Item 8. Portfolio Managers of Closed-End Management Investment Companies. (a) As of March 10, 2005, the SunAmerica Senior Floating Rate Fund's investments were managed by AIG Global Investment Company. The portfolio managers for the Fund, who are jointly responsible for the day-to-day investment management of the portfolio are Steven Oh, John Lapham and Thomas Brandt. Steven Oh, CFA, joined AIG Global Investment Company in 2002 and is a managing director and co-portfolio manager for the Leveraged Loan Group. Prior to joining AIG Global Investment Group, Mr. Oh served as a portfolio manager at Citadel Investments and Koch Capital and was a Vice President in high yield and distressed debt trading at BancAmerica Securities. John Lapham, CFA, joined AIG Global Investment Company with the acquisition of SunAmerica in 1999, he is a co-portfolio manager for the Leveraged Loan Group. Mr. Lapham joined SunAmerica in 1995 and was managing director in the Corporate Finance group. Thomas Brandt joined AIG Global Investment Company in 2000 as a trader and is responsible for co-managing the portfolio. Specifically, Mr. Brandt is responsible for the purchase and sale of bank debt. Prior to joining AIG Global Investment Group, Mr. Brandt was a Managing Director at BNP Paribas' Media and Telecom Finance Department, where he was responsible for a $2.8 billion media and telecom loan portfolio. Other Accounts Managed by Portfolio Managers The following table indicates the type, name, and total assets of other accounts of which the Portfolio Manager has day-to-day responsibilities as of January 31, 2005. These accounts include, Registered Investment Companies ("RIC"), Other Pooled Investments ("OPI") (hedge funds, private institutional accounts, etc.), and Other Accounts ("OA"). - ---------------------------- -------------------------- -------------------------- -------------------------- Name of Portfolio Manager Type of Account Name/Number of Account(s) Total Assets Managed in Accounts - ---------------------------- -------------------------- -------------------------- -------------------------- John Lapham and OPI 1 $1.1 billion Steven Oh -------------------------- -------------------------- -------------------------- as Co-Managers OA 5 $2.95 billion - ---------------------------- -------------------------- -------------------------- -------------------------- Thomas Brandt None None None - ---------------------------- -------------------------- -------------------------- --------------------------
Conflicts of Interest AIG Global Investment Corp. ("AIGGIC") aims to conduct its activities in such a manner that permits it to deal fairly with each of its clients on an overall basis in accordance with applicable securities laws and fiduciary obligations. In that regard, AIGGIC has adopted and implemented policies and procedures, including brokerage and trade allocation policies and procedures, which AIGGIC believes address the conflicts associated with managing multiple accounts for multiple clients (including affiliated clients). AIGGIC also monitors a variety of areas, including compliance with guidelines of the Fund and other accounts it manages and compliance with AIGGIC's Code of Ethics. Furthermore, AIGGIC's management periodically reviews the performance of a portfolio manager. Although AIGGIC does not track the time a portfolio manager spends on a single portfolio, AIGGIC does periodically assess whether a portfolio manager has adequate time and resources to effectively manage all of such portfolio manager's accounts. Fund Ownership The following table indicates the number of shares/units of the fund beneficially owned by the Portfolio Manager and the value of those shares as of January 31, 2005. - ------------------------------------- ----------------------------------- ----------------------------------- Name of Portfolio Manager Number of Shares/Units of the Approximate value of Shares/Units Fund Beneficially Owned owned (as of Fund's Fiscal Year End) - ------------------------------------- ----------------------------------- ----------------------------------- John Lapham None None - ------------------------------------- ----------------------------------- ----------------------------------- Steven Oh None None - ------------------------------------- ----------------------------------- ----------------------------------- Thomas Brandt None None - ------------------------------------- ----------------------------------- -----------------------------------
Portfolio Manager Compensation The portfolio managers' compensation has both a salary and a bonus component. The compensation structure described below is utilized for both the Registered Investment Companies and all other accounts aforementioned. The salary component is a fixed annual salary paid to all AIGGIC portfolio managers. The bonus component is computed as follows: 60% is measured largely by the performance in managing the Portfolio Manager's funds, 20% of the bonus is determined by the overall profitability of AIGGIC; and the final twenty percent (20%) is determined on a discretionary basis. Determination of the performance portion of the compensation includes such factors as portfolio returns relative to benchmark indices, default losses, impaired sales and other criteria. Any long-term compensation, including stock options, is not performance based, but instead is based on certain vesting dates. (b) Not applicable. Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. Not applicable. Item 10. Submission of Matters to a Vote of Security Holders. Not applicable. Item 11. Controls and Procedures. (a) An evaluation was performed within 90 days of the filing of this report, under the supervision and with the participation of the registrant's management, including the President and Treasurer, of the effectiveness of the design and operation of the registrant's disclosure controls and procedures. Based on that evaluation, the registrant's management, including the President and Treasurer, concluded that the registrant's disclosure controls and procedures are effective. (b) There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 12. Exhibits. (a) (1) Code of Ethics applicable to its Principal Executive and Principal Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley Act of 2002 attached hereto as Exhibit 99.406.Code of Ethics. (2) Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT. (3) Not applicable. (b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto as Exhibit 99.906.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. SunAmerica Senior Floating Rate Fund, Inc. By: /s/ Vincent M. Marra -------------------- Vincent M. Marra President Date: March 11, 2005 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Vincent M. Marra -------------------- Vincent M. Marra President Date: March 11, 2005 By: /s/ Donna M. Handel ------------------- Donna M. Handel Treasurer Date: March 11, 2005 EX-99.406.CODE 2 dex99406code.txt CODE OF ETHICS Exhibit 99.406. Code of Ethics ANCHOR SERIES TRUST AIG SERIES TRUST SUNAMERICA EQUITY FUNDS SUNAMERICA FOCUSED SERIES, INC. SUNAMERICA INCOME FUNDS SUNAMERICA MONEY MARKET FUNDS, INC. SUNAMERICA SENIOR FLOATING RATE FUND, INC. (collectively, the "Funds") CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND PRINCIPAL ACCOUNTING OFFICERS I. INTRODUCTION The Boards of Directors/Trustees of the Funds (the "Boards") have adopted this Code of Ethics (this "Code") pursuant to Section 406 of the Sarbanes-Oxley Act applicable to the Funds' Principal Executive Officer and Principal Accounting Officer (the "Covered Officers" each of whom is set forth in Exhibit A) for the purpose of promoting: o Honest and ethical conduct, including the ethical handling of conflicts of interest between personal and professional relationships; o Full, fair, accurate, timely and understandable disclosure; o Compliance with applicable laws and governmental rules and regulations; o The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and o Accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. II. COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS OF INTEREST A "conflict of interest" occurs when a Covered Officer's private interest improperly interferes with the interests of, or his or her service to, a Trust. For example, a conflict of interest would arise if a Covered Officer, or a member of his or her family, receives improper personal benefits as a result of his or her position with the Trust. Certain conflicts of interest arise out of the relationships between Covered Officers and the Funds and already are subject to conflict of interest provisions in the Investment Company Act of 1940, as amended (the "Investment Company Act") and the Investment Advisers Act of 1 1940, as amended (the "Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Funds because of their status as "affiliated persons" of the Funds. The compliance programs and procedures of the Funds and the Funds' investment adviser, AIG SunAmerica Asset Management Corp. ("SAAMCo"), are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code. Although typically not presenting an opportunity for improper personal benefit, conflicts may arise from, or as a result of, the contractual relationship between, the Funds and SAAMCo, of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Funds or for SAAMCo, or for both), be involved in establishing policies and implementing decisions that will have different effects on the Funds and SAAMCo. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Funds and SAAMCo and is consistent with the performance by the Covered Officers of their duties as officers of the Funds. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Boards that the Covered Officers may also be officers or employees of other investment companies advised by SAAMCo. In particular, each Covered Officer must: o Not use his or her personal influence or personal relationships to influence investment decisions or financial reporting by a Trust whereby the Covered Officer would benefit personally to the detriment of the Trust; o Not cause a Trust to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of the Trust; and o Report at least annually to the Ethics Committee any material transaction or relationship that could reasonably be expected to give rise to a conflict of interest. There are certain potential conflict of interest situations that should be discussed with the Ethics Committee if material. Examples of these include: o Service as a director on the board of any company; o The receipt of any non-nominal gifts; o The receipt of any entertainment from any company with which a Trust has current or prospective business dealings unless such entertainment is business-related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; 2 o Any ownership interest in, or any consulting or employment relationship with, any of the Funds' service providers, other than SAAMCo, the Funds' principal underwriter or any affiliated person thereof; o A direct or indirect financial interest in commissions, transaction charges or spreads paid by a Trust for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. III. DISCLOSURE AND COMPLIANCE o Each Covered Officer should familiarize himself or herself with the disclosure requirements generally applicable to the Funds; o Each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to others, whether within or outside the Funds, including to the Boards and auditors, or to governmental regulators and self-regulatory organizations; o Each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the Funds and SAAMCo with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents that the Funds file with, or submit to, the SEC and in other public communications made by the Funds; and o It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. REPORTING AND ACCOUNTABILITY Each Covered Officer must: o Upon adoption of the Code (or thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Boards that he or she has received, read and understands the Code; o Annually thereafter affirm to the Boards that he or she has complied with the requirements of the Code; o Not retaliate against any other Covered Officer or affiliated person of the Funds for reports of potential violations of this Code that are made in good faith; and o Notify the Ethics Committee promptly if he or she knows of any violation of this Code. Failure to do so is itself a violation of this Code. The Ethics Committee is responsible for applying this Code to specific situations in which questions are presented to it and has the authority to interpret this Code in any particular situation. The Ethics Committee will also consider waivers sought by the Covered Officers. 3 The Funds will act according to the following procedures in investigating and enforcing this Code: o The Ethics Committee will take all appropriate action to investigate any potential violations reported to it; o If, after such investigation, the Ethics Committee believes that no violation has occurred, the Ethics Committee is not required to take any further action; o If the Ethics Committee determines that a violation has occurred, it will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of SAAMCo or its board; or a recommendation to dismiss the Covered Officer; o The Ethics Committee will be responsible for granting waivers, as appropriate; o The Ethics Committee will inform the Boards of violations or waivers of this Code; and o Any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. OTHER POLICIES AND PROCEDURES This Code shall be the sole Code of Ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to investment companies thereunder. Insofar as other policies or procedures of the Funds, SAAMCo, the Funds' principal underwriter or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code. The Code of Ethics of the Funds, SAAMCo and the Funds' principal underwriter, under Rule 17j-1 of the Investment Company Act, and SAAMCo's more detailed policies and procedures set forth in the SAAMCo Compliance Procedures Manual are separate requirements applying to Covered Officers and others, and are not part of this Code. VI. AMENDMENTS Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Boards. VII. CONFIDENTIALITY All reports and records prepared or maintained pursuant to this Code shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Funds, the Ethics Committee, SAAMCo and the Boards and their independent counsel. 4 VIII. INTERNAL USE The Code is intended solely for internal use by the Funds and does not constitute an admission, by or on behalf of the Funds, as to any fact, circumstance or legal conclusion. Date: August 7, 2003 EXHIBIT A Robert M. Zakem, as President of the Funds (Through December 1, 2004) Vincent Marra, as President of the Funds Donna M. Handel, as Treasurer of the Funds 5 EX-99.CERT 3 dex99cert.txt CERTIFICATION PURSUANT TO SECTION 302 Exhibit 99.CERT CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT I, Vincent M. Marra, certify that: 1. I have reviewed this report on Form N-CSR of SunAmerica Senior Floating Rate Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: February 22, 2005 /s/ Vincent M. Marra - -------------------- Vincent M. Marra President CERTIFICATION PURSUANT TO SECTION 302 OF THE SARDINES-OXLEY ACT I, Donna M. Handel, certify that: 1. I have reviewed this report on Form N-CSR of SunAmerica Senior Floating Rate Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: February 22, 2005 /s/ Donna M. Handel - ------------------- Donna M. Handel Treasurer EX-99.906CERT 4 dex99906cert.txt CERTIFICATION PURSUANT TO SECTION 906 EXHIBIT 99.906.CERT CERTIFICATIONS PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT Vincent M. Marra, President, and Donna M. Handel, Treasurer of SunAmerica Senior Floating Rate Fund, Inc. (the "Registrant"), each certify to the best of his or her knowledge that: 1. The attached Form N-CSR report of the Registrant fully complies with the requirements of Sections 13(a) and 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in such N-CSR report fairly represents, in all material respects, the financial conditions and results of operations of the Registrant as of, and for, the periods presented in the report. Dated: February 22, 2005 /s/ Vincent M. Marra - -------------------- Vincent M. Marra President /s/ Donna M. Handel - ------------------- Donna M. Handel Treasurer A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----