Sub-Item 77Q1(e)
MASTER INTERGROUP SUB-ADVISORY CONTRACT
This contract is made as of August 27, 2012 by and among Invesco Advisers,
Inc. (the "Adviser") and each of Invesco Canada Ltd., Invesco Asset Management
Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management
(Japan) Limited, Invesco Australia Limited, Invesco Hong Kong Limited, and
Invesco Senior Secured Management, Inc. (each a "Sub-Adviser" and,
collectively, the "Sub-Advisers").
WHEREAS:
A) The Adviser has entered into an investment advisory agreement
with Invesco Xxx Xxxxxx High Income Trust II (the "Trust"), a closed-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act");
B) The Adviser is authorized to delegate certain, any or all of its
rights, duties and obligations under investment advisory agreements to
sub-advisers, including sub-advisers that are affiliated with the Adviser;
C) Each Sub-Adviser represents that it is registered with the
U.S. Securities and Exchange Commission ("SEC") as an investment adviser
under the Investment Advisers Act of 1940 ("Advisers Act") as an investment
adviser, or will be so registered prior to providing any services to the
Trust under this Contract, and engages in the business of acting as an
investment adviser; and
D) The Sub-Advisers and their affiliates have personnel in various
locations throughout the world and have been formed in part for the purpose
of researching and compiling information and recommendations on the
economies of various countries and securities of issuers located in such
countries or on various types of investments and investment techniques, and
providing investment advisory services in connection therewith.
NOW THEREFORE, in consideration of the promises and the mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Adviser hereby appoints each Sub-Adviser as a
sub-adviser of the Trust for the period and on the terms set forth herein.
Each Sub-Adviser accepts such appointment and agrees to render the services
herein set forth, for the compensation herein provided.
2. Duties as Sub-Adviser. Subject to paragraph 7 below, the Adviser may,
in its discretion, appoint each Sub-Advisor to perform one or more of the
following services with respect to all or a portion of the investments of
the Trust. The services and the portion of the investments of the Trust to
be advised or managed by each Sub-Adviser shall be as agreed upon from time
to time by the Adviser and the Sub-Advisers. Each Sub-Adviser shall pay the
salaries and fees of all personnel of such Sub-Adviser performing services
for the Trust related to research, statistical and investment activities.
(a) Investment Advice. If and to the extent requested by the Adviser,
each Sub-Adviser shall provide investment advice to the Trust and the
Adviser with respect to all or a portion of the investments of the Trust or
with respect to various investment techniques, and in connection with such
advice shall furnish the Trust and the Adviser with such factual
information, research reports and investment recommendations as the Adviser
may reasonably require.
(b) Order Execution. If and to the extent requested by the Adviser, each
Sub-Adviser shall place orders for the purchase and sale of portfolio
securities or other investments for the Trust. In so doing, each Sub-Adviser
agrees that it shall comply with paragraph 3 below.
(c) Discretionary Investment Management. If and to the extent requested
by the Adviser, each Sub-Adviser shall, subject to the supervision of the
Trust's Board of Trustees (the "Board") and the Adviser, manage all or a
portion of the investments of the Trust in accordance with the investment
objectives, policies and limitations provided in the Trust's Registration
Statement and such other limitations as the Trust or the Adviser may impose
with respect to the Trust by notice to the applicable Sub-Adviser(s) and
otherwise in accordance with
paragraph 5 below. With respect to the portion of the investments of the
Trust under its management, each Sub-Adviser is authorized to: (i) make
investment decisions on behalf of the Trust with regard to any stock, bond,
other security or investment instrument, including but not limited to
foreign currencies, futures, options and other derivatives, and with regard
to borrowing money; (ii) place orders for the purchase and sale of
securities or other investment instruments with such brokers and dealers as
the Sub-Adviser may select; and (iii) upon the request of the Adviser,
provide additional investment management services to the Trust, including
but not limited to managing the Trust's cash and cash equivalents and
lending securities on behalf of the Trust. In selecting brokers or dealers
to execute trades for the Trust, each Sub-Adviser will comply with its
written policies and procedures regarding brokerage and trading, which
policies and procedures shall have been approved by the Board. All
discretionary investment management and any other activities of each
Sub-Adviser shall at all times be subject to the control and direction of
the Adviser and the Board.
3. Broker-Dealer Relationships. Each Sub-Adviser agrees that, in placing
orders with brokers and dealers, it will attempt to obtain the best net
result in terms of price and execution. Consistent with this obligation,
each Sub-Adviser may, in its discretion, purchase and sell portfolio
securities from and to brokers and dealers who sell shares of the Trust or
provide the Trust, the Adviser's other clients, or a Sub-Adviser's other
clients with research, analysis, advice and similar services. Each
Sub-Adviser may pay to brokers and dealers, in return for such research and
analysis, a higher commission or spread than may be charged by other brokers
and dealers, subject to such Sub-Adviser determining in good faith that such
commission or spread is reasonable in terms either of the particular
transaction or of the overall responsibility of the Adviser and such
Sub-Adviser to the Trust and their other clients and that the total
commissions or spreads paid by the Trust will be reasonable in relation to
the benefits to the Trust over the long term. In no instance will portfolio
securities be purchased from or sold to a Sub-Adviser, or any affiliated
person thereof, except in accordance with the applicable securities laws and
the rules and regulations thereunder and any exemptive orders currently in
effect. Whenever a Sub-Adviser simultaneously places orders to purchase or
sell the same security on behalf of the Trust and one or more other accounts
advised by such Sub-Adviser, such orders will be allocated as to price and
amount among all such accounts in a manner believed to be equitable to each
account.
4. Books and Records. Each Sub-Adviser will maintain all required books
and records with respect to the securities transactions of the Trust, and
will furnish the Board and the Adviser with such periodic and special
reports as the Board or the Adviser reasonably may request. Each Sub-Adviser
hereby agrees that all records which it maintains for the Adviser are the
property of the Adviser, and agrees to preserve for the periods prescribed
by applicable law any records which it maintains for the Adviser and which
are required to be maintained, and further agrees to surrender promptly to
the Adviser any records which it maintains for the Adviser upon request by
the Adviser.
5. Further Duties.
(a) In all matters relating to the performance of this Contract, each
Sub-Adviser will act in conformity with the Agreement and Declaration of
Trust, By-Laws and Registration Statement of the Trust and with the
instructions and directions of the Adviser and the Board and will comply
with the requirements of the 1940 Act, the rules, regulations, exemptive
orders and no-action positions thereunder, and all other applicable laws and
regulations.
(b) Each Sub-Adviser shall maintain compliance procedures for the Trust
that it and the Adviser reasonably believe are adequate to ensure compliance
with the federal securities laws (as defined in Rule 38a-1 of the 0000 Xxx)
and the investment objective(s) and policies as stated in the Trust's
prospectus and statement of additional information. Each Sub-Adviser at its
expense will provide the Adviser or the Trust's Chief Compliance Officer
with such compliance reports relating to its duties under this Contract as
may be requested from time to time. Notwithstanding the foregoing, each
Sub-Adviser will promptly report to the Adviser any material violations of
the federal securities laws (as defined in Rule 38a-1 of the 0000 Xxx) that
it is or should be aware of or of any material violation of the
Sub-Adviser's compliance policies and procedures that pertain to the Trust.
(c) Each Sub-Adviser at its expense will make available to the Board and
the Adviser at reasonable times its portfolio managers and other appropriate
personnel, either in person or, at the mutual convenience of the Adviser and
the Sub-Adviser, by telephone, in order to review the investment policies,
performance and other investment
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related information regarding the Trust and to consult with the Board and
the Adviser regarding the Trust's investment affairs, including economic,
statistical and investment matters related to the Sub-Adviser's duties
hereunder, and will provide periodic reports to the Adviser relating to the
investment strategies it employs. Each Sub-Adviser and its personnel shall
also cooperate fully with counsel and auditors for, and the Chief Compliance
Officer of, the Adviser and the Trust.
(d) Each Sub-Adviser will assist in the fair valuation of portfolio
securities held by the Trust. The Sub-Adviser will use its reasonable
efforts to provide, based upon its own expertise, and to arrange with
parties independent of the Sub-Adviser such as broker-dealers for the
provision of, valuation information or prices for securities for which
prices are deemed by the Adviser or the Trust's administrator not to be
readily available in the ordinary course of business from an automated
pricing service. In addition, each Sub-Adviser will assist the Trust and its
agents in determining whether prices obtained for valuation purposes
accurately reflect market price information relating to the assets of the
Trust at such times as the Adviser shall reasonably request, including but
not limited to, the hours after the close of a securities market and prior
to the daily determination of the Trust's net asset value per share.
(e) Each Sub-Adviser represents and warrants that it has adopted a code
of ethics meeting the requirements of Rule 17j-1 under the 1940 Act and the
requirements of Rule 204A-1 under the Advisers Act and has provided the
Adviser and the Board a copy of such code of ethics, together with evidence
of its adoption, and will promptly provide copies of any changes thereto,
together with evidence of their adoption. Upon request of the Adviser, but
in any event no less frequently than annually, each Sub-Adviser will supply
the Adviser a written report that (A) describes any issues arising under the
code of ethics or procedures since the Sub-Adviser's last report, including
but not limited to material violations of the code of ethics or procedures
and sanctions imposed in response to the material violations; and
(B) certifies that the procedures contained in the Sub-Adviser's code of
ethics are reasonably designed to prevent "access persons" from violating
the code of ethics.
(f) Upon request of the Adviser, each Sub-Adviser will review draft
reports to shareholders and other documents provided or available to it and
provide comments on a timely basis. In addition, each Sub-Adviser and each
officer and portfolio manager thereof designated by the Adviser will provide
on a timely basis such certifications or sub-certifications as the Adviser
may reasonably request in order to support and facilitate certifications
required to be provided by the Trust's Principal Executive Officer and
Principal Financial Officer and will adopt such disclosure controls and
procedures in support of the disclosure controls and procedures adopted by
the Trust as the Adviser, on behalf of the Trust, deems are reasonably
necessary.
(g) Unless otherwise directed by the Adviser or the Board, each
Sub-Adviser will vote all proxies received in accordance with the Adviser's
proxy voting policy or, if the Sub-Adviser has a proxy voting policy
approved by the Board, the Sub-Adviser's proxy voting policy. Each
Sub-Adviser shall maintain and shall forward to the Trust or its designated
agent such proxy voting information as is necessary for the Trust to timely
file proxy voting results in accordance with Rule 30b1-4 of the 1940 Act.
(h) Each Sub-Adviser shall provide the Trust's custodian on each business
day with information relating to all transactions concerning the assets of
the Trust and shall provide the Adviser with such information upon request
of the Adviser.
6. Services Not Exclusive. The services furnished by each Sub-Adviser
hereunder are not to be deemed exclusive and such Sub-Adviser shall be free
to furnish similar services to others so long as its services under this
Contract are not impaired thereby. Nothing in this Contract shall limit or
restrict the right of any director, officer or employee of a Sub-Adviser,
who may also be a Trustee, officer or employee of the Trust, to engage in
any other business or to devote his or her time and attention in part to the
management or other aspects of any other business, whether of a similar
nature or a dissimilar nature.
7. Use of Subsidiaries and Affiliates. Each Sub-Adviser may perform any
or all of the services contemplated hereunder, including but not limited to
providing investment advice to the Trust pursuant to paragraph 2(a) above
and placing orders for the purchase and sale of portfolio securities or
other investments for the Trust pursuant to paragraph 2(b) above, directly
or through such of its subsidiaries or other affiliates, including each of
the other Sub-Advisers, as such Sub-Adviser shall determine; provided,
however, that performance of such services
3
through such subsidiaries or other affiliates shall have been approved, when
required by the 1940 Act, by (i) a vote of a majority of the independent
Trustees who are not parties to this Contract or "interested persons" (as
defined in the 0000 Xxx) of a party to this Contract, other than as Board
members ("Independent Trustees"), cast in person at a meeting called for the
purpose of voting on such approval, and/or (ii) a vote of a majority of that
Trust's outstanding voting securities.
8. Compensation.
(a) The only fees payable to the Sub-Advisers under this Contract are for
providing discretionary investment management services pursuant to
paragraph 2(c) above. For such services, the Adviser will pay each
Sub-Adviser a fee, computed daily and paid monthly, equal to (i) 40% of the
monthly compensation that the Adviser receives from the Trust pursuant to
its advisory agreement with the Trust, multiplied by (ii) the fraction equal
to the net assets of the Trust as to which the Sub-Adviser shall have
provided discretionary investment management services pursuant to
paragraph 2(c) above for that month divided by the net assets of the Trust
for that month. This fee shall be payable on or before the last business day
of the next succeeding calendar month. This fee shall be reduced to reflect
contractual or voluntary fee waivers or expense limitations by the Adviser,
if any, in effect from time to time as set forth in paragraph 9 below. In no
event shall the aggregate monthly fees paid to the Sub-Advisers under this
Contract exceed 40% of the monthly compensation that the Adviser receives
from the Trust pursuant to its advisory agreement with the Trust, as reduced
to reflect contractual or voluntary fee waivers or expense limitations by
the Adviser, if any.
(b) If this Contract becomes effective or terminates before the end of
any month, the fees for the period from the effective date to the end of the
month or from the beginning of such month to the date of termination, as the
case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
(c) If a Sub-Adviser provides the services under paragraph 2(c) above to
the Trust for a period that is less than a full month, the fees for such
period shall be prorated according to the proportion which such period bears
to the applicable full month.
9. Fee Waivers and Expense Limitations. If, for any fiscal year of the
Trust, the amount of the advisory fee which such Trust would otherwise be
obligated to pay to the Adviser is reduced because of contractual or
voluntary fee waivers or expense limitations by the Adviser, the fee payable
to each Sub-Adviser pursuant to paragraph 8 above shall be reduced
proportionately; and to the extent that the Adviser reimburses the Trust as
a result of such expense limitations, such Sub-Adviser shall reimburse the
Adviser that proportion of such reimbursement payments which the fee payable
to each Sub-Adviser pursuant to paragraph 8 above bears to the advisory fee
under this Contract.
10. Limitation of Liability of Sub-Adviser and Indemnification. No
Sub-Adviser shall be liable for any costs or liabilities arising from any
error of judgment or mistake of law or any loss suffered by the Trust in
connection with the matters to which this Contract relates except a loss
resulting from willful misfeasance, bad faith or gross negligence on the
part of such Sub-Adviser in the performance by such Sub-Adviser of its
duties or from reckless disregard by such Sub-Adviser of its obligations and
duties under this Contract. Any person, even though also an officer,
partner, employee, or agent of a Sub-Adviser, who may be or become a
Trustee, officer, employee or agent of the Trust, shall be deemed, when
rendering services to the Trust or acting with respect to any business of
the Trust, to be rendering such service to or acting solely for the the
Trust and not as an officer, partner, employee, or agent or one under the
control or direction of such Sub-Adviser even though paid by it.
11. Duration and Termination.
(a) This Contract shall become effective with respect to each Sub-Adviser
upon the later of the date hereabove written and the date that such
Sub-Adviser is registered with the SEC as an investment adviser under the
Advisers Act, if a Sub-Adviser is not so registered as of the date hereabove
written; provided, however, that this Contract shall not take effect with
respect to the Trust unless it has first been approved (i) by a vote of a
majority of the Independent Trustees, cast in person at a meeting called for
the purpose of voting on such
4
approval, and (ii) by vote of a majority of the Trust's outstanding voting
securities, when required by the 0000 Xxx.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in force and effect until two years after its effective date
determined in 11(a). Thereafter, if not terminated, with respect to each
Fund, this Contract shall continue automatically for successive periods not
to exceed twelve months each, provided that such continuance is specifically
approved at least annually (i) by a vote of a majority of the Independent
Trustees, cast in person at a meeting called for the purpose of voting on
such approval, and (ii) by the Board or by vote of a majority of the
outstanding voting securities of that Fund.
(c) Notwithstanding the foregoing, with respect to the Trust or any
Sub-Adviser(s), this Contract may be terminated at any time, without the
payment of any penalty, (i) by vote of the Board or by a vote of a majority
of the outstanding voting securities of the Trust on sixty days' written
notice to such Sub-Adviser(s); or (ii) by the Adviser on sixty days' written
notice to such Sub-Adviser(s); or (iii) by a Sub-Adviser on sixty days'
written notice to the Trust. Should this Contract be terminated with respect
to a Sub-Adviser, the Adviser shall assume the duties and responsibilities
of such Sub-Adviser unless and until the Adviser appoints another
Sub-Adviser to perform such duties and responsibilities. Termination of this
Contract with respect to one Sub-Adviser(s) shall not affect the continued
effectiveness of this Contract with respect to any remaining Sub-Adviser(s).
This Contract will automatically terminate in the event of its assignment.
12. Amendment. No provision of this Contract may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed
by the party against which enforcement of the change, waiver, discharge or
termination is sought, and, when required by the 1940 Act, no amendment of
this Contract shall be effective until approved by vote of a majority of the
Trust's outstanding voting securities.
13. Notices. Any notices under this Contract shall be in writing,
addressed and delivered, telecopied or mailed postage paid, to the other
party entitled to receipt thereof at such address as such party may
designate for the receipt of such notice. Until further notice to the other
party, it is agreed that the address of the Trust and the Adviser shall be
0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000. Until further notice to
the other party, it is agreed that the address of each Sub-Adviser shall be
set forth in Exhibit A attached hereto.
14. Governing Law. This Contract shall be construed in accordance with
the laws of the State of Texas and the 1940 Act. To the extent that the
applicable laws of the State of Texas conflict with the applicable
provisions of the 1940 Act, the latter shall control.
15. Multiple Sub-Advisory Agreements. This Contract has been signed by
multiple parties; namely the Adviser, on one hand, and each Sub-Adviser, on
the other. The parties have signed one document for administrative
convenience to avoid a multiplicity of documents. It is understood and
agreed that this document shall constitute a separate sub-advisory agreement
between the Adviser and each Sub-Adviser with respect to the Trust, as if
the Adviser and such Sub-Adviser had executed a separate sub-advisory
agreement naming such Sub-Adviser as a sub-adviser to the Trust. With
respect to any one Sub-Adviser, (i) references in this Contract to "a
Sub-Adviser" or to "each Sub-Adviser" shall be deemed to refer only to such
Sub-Adviser, and (ii) the term "this Contract" shall be construed according
to the foregoing provisions.
16. Miscellaneous. The captions in this Contract are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Contract shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Contract shall
not be affected thereby. This Contract shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors. Any
question of interpretation of any term or provision of this Contract having
a counterpart in or otherwise derived from a term or provision of the 1940
Act or the Advisers Act shall be resolved by reference to such term or
provision of the 1940 Act or the Advisers Act and to interpretations
thereof, if any, by the United States Courts or in the absence of any
controlling decision of any such court, by rules, regulations or orders of
the SEC issued pursuant to said Acts. In addition, where the effect of a
requirement of the 1940 Act or the Advisers Act reflected in any provision
of the Contract is revised by rule, regulation or order of the SEC, such
provision shall be deemed to incorporate the effect of such rule, regulation
or order.
5
IN WITNESS WHEREOF, the parties hereto have caused this Contract to be
executed by their officers designated as of the day and year first above
written.
INVESCO ADVISERS, INC.
Adviser
BY: /s/ Xxxx X. Xxxx
------------------------------
NAME: Xxxx X. Xxxx
TITLE: Senior Vice President
6
Sub-Item 77Q1(e)
INVESCO ASSET MANAGEMENT DEUTSCHLAND GMBH INVESCO ASSET MANAGEMENT LIMITED
Sub-Adviser Sub-Adviser
By: /s/ Xxxxxxxxx Xxxxxxxxx /s/ Jens Langewand By: /s/ X. X. Xxxxxxxxx
----------------------------------------------------- -----------------------------------------------------
Name: Xxxxxxxxx Xxxxxxxxx Jens Langewand Name: X. X. Xxxxxxxxx
Title: Managing Director Managing Director Title: Director
INVESCO ASSET MANAGEMENT (JAPAN) LIMITED INVESCO AUSTRALIA LIMITED
Sub-Adviser Sub-Adviser
By: /s/ Xxxxxxxx Xxxxxxxx By: /s/ Xxxx Xxxxxxx /s/ Xxxx X'Xxxxx
----------------------------------------------------- -----------------------------------------------------
Name: Xxxxxxxx Xxxxxxxx Name: Xxxx Xxxxxxx Xxxx X'Xxxxx
Title: Managing Director Title: Co Secretary Chief Executive Officer
INVESCO HONG KONG LIMITED INVESCO SENIOR SECURED MANAGEMENT, INC.
Sub-Adviser Sub-Adviser
By: /s/ Xxxxx Xxx /s/ Xxxxxx Xxx By: /s/ Xxxxxxx X. Xxxxx
----------------------------------------------------- -----------------------------------------------------
Name: Xxxxx Xxx Xxxxxx Xxx Name: Xxxxxxx X. Xxxxx
Title: Director Director Title: Secretary & General Counsel
INVESCO CANADA LTD.
Sub-Adviser
By: /s/ Xxxx Xxxxxxx
-----------------------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Vice President; Head of
Legal-Canada; CCO; and Secretary
7
Sub-Item 77Q1(e)
EXHIBIT A
ADDRESSES OF SUB-ADVISERS
Invesco Asset Management Deutschland GmbH
Xx xxx Xxxxx 0, 0xx Xxxxx
Xxxxxxxxx, Xxxxxxx 00000
Invesco Asset Management Limited
00 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxx Xxxxxxx
XX0X 0XX
ENGLAND
Invesco Asset Management (Japan) Limited
Roppongi Hills Mori Tower 14F
0-00-0 Xxxxxxxx, Xxxxxx-xx, Xxxxx 000-0000
Invesco Australia Limited
000 Xxxxxxx Xxxxxx, Xxxxx 00
Xxxxxxxxx Xxxxxxxx 0000, Xxxxxxxxx
Invesco Hong Kong Limited
32nd Floor
Three Pacific Place
0 Xxxxx'x Xxxx Xxxx
Xxxx Xxxx
Invesco Senior Secured Management, Inc.
1166 Avenue of the Americas, 00xx Xxxxx
Xxx Xxxx, XX 00000
XXX
Xxxxxxx Xxxxxx Ltd.
0000 Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX, X0X 0X0
8
Sub-Item 77Q1(e)
MEMORANDUM OF AGREEMENT
(AFFILIATED MONEY MARKET FUND ADVISORY FEE WAIVER)
This Memorandum of Agreement is entered into as of the dates indicated on
Exhibit "A" between Invesco Xxx Xxxxxx Bond Fund, Invesco Xxx Xxxxxx Exchange
Fund and Invesco Xxx Xxxxxx High Income Trust II (each a "Fund" and
collectively, the "Fund's and Invesco Advisers, Inc. ("Invesco").
For and in consideration of the mutual terms and agreements set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the Funds and Invesco agree as follows:
1. Each Fund and Invesco agree that until the expiration date, if any, of
the commitment set forth on the attached Exhibit "A" occurs, as such
Exhibit "A" is amended from time to time, Invesco will waive advisory
fees payable by an Investing Fund (defined below) in an amount equal to
100% of the net advisory fee Invesco receives on the Uninvested Cash
(defined below) from the Affiliated Money Market Fund (defined below) in
which the Investing Fund invests (the "Waiver").
i. Invesco's Fund Accounting Group will calculate, and apply, the
Waiver monthly, based upon the average investment of Uninvested
Cash made by the Investing Fund during the previous month in an
Affiliated Money Market Fund.
ii. The Waiver will not apply to those investing Funds that do not
charge an advisory fee, either due to the terms of their advisory
agreement, or as a result of contractual or voluntary fee waivers.
iii. The Waiver will not apply to cash collateral for securities lending.
For purposes of the paragraph above, the following terms shall have the
following meanings:
(a) "Affiliated Money Market Fund" - any existing or future Fund that
holds itself out as a money market fund and complies with Rule 2a-7
under the Investment Company Act of 1940, as amended;
(b) "Investing Fund" - any Fund investing Cash Balances and/or Cash
Collateral in an Affiliated Money Market Fund; and
(b) "Uninvested Cash" - cash available and uninvested by a Fund that may
result from a variety of sources, including dividends or interest
received on portfolio securities, unsettled securities transactions,
strategic reserves, matured investments, proceeds from liquidation of
investment securities, dividend payments, or new investor capital.
2. Neither a Fund nor Invesco may remove or amend the Waiver to a Fund's
detriment prior to requesting and receiving the approval of the Fund's
Board of Trustee/Managing General Partners to remove or amend such
Waiver. Invesco will not have any right to reimbursement of any amount
so waived.
Subject to the foregoing paragraphs, each of the Funds and Invesco agree to
review the then-current waivers for each class of the Funds listed on the
Exhibit on a date prior to the Expiration Date to determine whether such
waivers should be amended, continued or terminated. The waivers will expire
upon the Expiration Date unless the Funds and Invesco have agreed to continue
them. The Exhibit will be amended to reflect any such agreement.
Nothing in this Memorandum of Agreement is intended to affect any other
memorandum of agreement executed by any Fund or Invesco with respect to any
other fee waivers, expense reimbursements and/or expense limitations.
IN WITNESS WHEREOF, each Fund and Invesco have entered into this Memorandum
of Agreement as of the dates indicated on Exhibit "A".
INVESCO XXX XXXXXX BOND FUND
INVESCO XXX XXXXXX EXCHANGE FUND
INVESCO XXX XXXXXX HIGH INCOME
TRUST II
By: /s/ Xxxx X. Xxxx
------------------------------
Title: Senior Vice President
INVESCO ADVISERS, INC.
By: /s/ Xxxx X. Xxxx
------------------------------
Title: Senior Vice President
2
EXHIBIT "A"
INVESCO XXX XXXXXX BOND FUND
FUND EFFECTIVE DATE COMMITTED UNTIL
---- -------------- ---------------
Invesco Xxx Xxxxxx Bond Fund May 15, 2012 June 30, 2013
INVESCO XXX XXXXXX EXCHANGE FUND
FUND EFFECTIVE DATE COMMITTED UNTIL
---- -------------- ---------------
Invesco Xxx Xxxxxx Exchange Fund May 15, 2012 June 30, 2013
INVESCO XXX XXXXXX HIGH INCOME TRUST II
FUND EFFECTIVE DATE COMMITTED UNTIL
---- -------------- ---------------
Invesco Xxx Xxxxxx High Income Trust II May 15, 2012 June 30, 2013
A-1
Sub-Item 77Q1(e)
MASTER INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this 27th day of August, 2012, by and between Invesco
Xxx Xxxxxx High Income Trust II, a Delaware statutory trust (the "Trust"), and
Invesco Advisers, Inc., a Delaware corporation (the "Adviser").
RECITALS
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "1940 Act"), as a closed-end management investment company;
WHEREAS, the Adviser is registered under the Investment Advisers Act of
1940, as amended (the "Advisers Act"), as an investment Adviser and engages in
the business of acting as an investment adviser;
WHEREAS, the Trust and the Adviser desire to enter into an agreement to
provide for investment advisory services to the Trust upon the terms and
conditions hereinafter set forth;
NOW THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
1. Advisory Services. The Adviser shall act as investment adviser for the
Trust and shall, in such capacity, supervise all aspects of the Trust's
operations, including the investment and reinvestment of cash, securities or
other properties comprising the Trust's assets, subject at all times to the
policies and control of the Board of Trustees. The Adviser shall give the
Trust the benefit of its best judgment, efforts and facilities in rendering
its services as investment advisor.
2. Investment Analysis and Implementation. In carrying out its
obligations under Section 1 hereof, the Adviser shall:
(a) supervise all aspects of the operations of the Trust;
(b) obtain and evaluate pertinent information about significant
developments and economic, statistical and financial data, domestic,
foreign or otherwise, whether affecting the economy generally or the
Trust, and whether concerning the individual issuers whose securities
are included in the assets of the Trust or the activities in which such
issuers engage, or with respect to securities which the Adviser
considers desirable for inclusion in the Trust's assets;
(c) determine which issuers and securities shall be represented in
the Trust's investment portfolios and regularly report thereon to the
Board of Trustees;
(d) formulate and implement continuing programs for the purchases and
sales of the securities of such issuers and regularly report thereon to
the Board of Trustees; and
(e) take, on behalf of the Trust, all actions which appear to the
Trust necessary to carry into effect such purchase and sale programs and
supervisory functions as aforesaid, including but not limited to the
placing of orders for the purchase and sale of securities for the Trust.
3. Securities Lending Duties and Fees. The Adviser agrees to provide the
following services in connection with the securities lending activities of
the Trust: (a) oversee participation in the securities lending program to
ensure compliance with all applicable regulatory and investment guidelines;
(b) assist the securities lending agent or principal (the "Agent") in
determining which specific securities are available for loan; (c) monitor
the Agent to ensure that securities loans are effected in accordance with
the Adviser's instructions and with procedures adopted by the Board of
Trustees; (d) prepare appropriate periodic reports for, and seek appropriate
approvals from, the Board of Trustees with respect to securities lending
activities; (e) respond to Agent inquiries; and (f) perform such other
duties as necessary.
As compensation for such services provided by the Adviser in connection
with securities lending activities, the Trust shall pay the Adviser a fee
equal to 25% of the net monthly interest or fee income retained or paid to
the Trust from such activities.
4. Delegation of Responsibilities. The Adviser is authorized to delegate
any or all of its rights, duties and obligations under this Agreement to one
or more sub-advisers, and may enter into agreements with sub-advisers, and
may replace any such sub-advisors from time to time in its discretion, in
accordance with the 1940 Act, the Advisers Act, and rules and regulations
thereunder, as such statutes, rules and regulations are amended from time to
time or are interpreted from time to time by the staff of the Securities and
Exchange Commission ("SEC"), and if applicable, exemptive orders or similar
relief granted by the SEC and upon receipt of approval of such sub-advisors
by the Board of Trustees and by shareholders (unless any such approval is
not required by such statutes, rules, regulations, interpretations, orders
or similar relief).
5. Independent Contractors. The Adviser and any sub-advisers shall for
all purposes herein be deemed to be independent contractors and shall,
unless otherwise expressly provided or authorized, have no authority to act
for or represent the Trust in any way or otherwise be deemed to be an agent
of the Trust.
6. Control by Board of Trustees. Any investment program undertaken by the
Adviser pursuant to this Agreement, as well as any other activities
undertaken by the Adviser on behalf of the Funds, shall at all times be
subject to any directives of the Board of Trustees.
7. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Adviser shall at all times conform to:
(a) all applicable provisions of the 1940 Act and the Advisers Act
and any rules and regulations adopted thereunder;
(b) the provisions of the registration statement of the Trust, as the
same may be amended from time to time under the Securities Act of 1933
and the 1940 Act;
(c) the provisions of the Declaration of Trust, as the same may be
amended from time to time;
(d) the provisions of the by-laws of the Trust, as the same may be
amended from time to time; and
(e) any other applicable provisions of state, federal or foreign law.
8. Broker-Dealer Relationships. The Adviser is responsible for decisions
to buy and sell securities for the Trust, broker-dealer selection, and
negotiation of brokerage commission rates.
(a) The Adviser's primary consideration in effecting a security
transaction will be to obtain the best execution.
(b) In selecting a broker-dealer to execute each particular
transaction, the Adviser will take the following into consideration: the
best net price available; the reliability, integrity and financial
condition of the broker-dealer; the size of and the difficulty in
executing the order; and the value of the expected contribution of the
broker-dealer to the investment performance of the Trust on a continuing
basis. Accordingly, the price to the Trust in any transaction may be
less favorable than that available from another broker-dealer if the
difference is reasonably justified by other aspects of the fund
execution services offered.
(c) Subject to such policies as the Board of Trustees may from time
to time determine, the Adviser shall not be deemed to have acted
unlawfully or to have breached any duty created by this Agreement or
otherwise solely by reason of its having caused the Trust to pay a
broker or dealer that provides brokerage and research services to the
Adviser an amount of commission for effecting a fund investment
transaction in excess of the amount of commission another broker or
dealer would have charged for effecting that transaction, if the Adviser
determines in good faith that such amount of commission was reasonable
in relation to the value of
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the brokerage and research services provided by such broker or dealer,
viewed in terms of either that particular transaction or the Adviser's
overall responsibilities with respect to the Trust, and to other clients
of the Adviser as to which the Adviser exercises investment discretion.
The Adviser is further authorized to allocate the orders placed by it on
behalf of the Trust to such brokers and dealers who also provide
research or statistical material, or other services to the Trust, to the
Adviser, or to any sub-adviser. Such allocation shall be in such amounts
and proportions as the Adviser shall determine and the Adviser will
report on said allocations regularly to the Board of Trustees indicating
the brokers to whom such allocations have been made and the basis
therefor.
(d) With respect to the Trust, to the extent the Adviser does not
delegate trading responsibility to one or more sub-advisers, in making
decisions regarding broker-dealer relationships, the Adviser may take
into consideration the recommendations of any sub-adviser appointed to
provide investment research or advisory services in connection with the
Trust, and may take into consideration any research services provided to
such sub-adviser by broker-dealers.
(e) Subject to the other provisions of this Section 8, the 1940 Act,
the Securities Exchange Act of 1934, and rules and regulations
thereunder, as such statutes, rules and regulations are amended from
time to time or are interpreted from time to time by the staff of the
SEC, any exemptive orders issued by the SEC, and any other applicable
provisions of law, the Adviser may select brokers or dealers with which
it or the Trust are affiliated.
9. Compensation. The compensation that the Trust shall pay the Adviser is
set forth in Appendix A attached hereto.
10. Expenses of the Trust. All of the ordinary business expenses incurred
in the operations of the Trust and the offering of its shares shall be borne
by the Trust unless specifically provided otherwise in this Agreement. These
expenses borne by the Trust include but are not limited to brokerage
commissions, taxes, legal, accounting, auditing, or governmental fees, the
cost of preparing share certificates, custodian, transfer and shareholder
service agent costs, expenses of issue, sale, redemption and repurchase of
shares, expenses of registering and qualifying shares for sale, expenses
relating to trustees and shareholder meetings, the cost of preparing and
distributing reports and notices to shareholders, the fees and other
expenses incurred by the Trust in connection with membership in investment
company organizations and the cost of printing copies of prospectuses and
statements of additional information distributed to the Trust's shareholders.
11. Services to Other Companies or Accounts. The Trust understands that
the Adviser now acts, will continue to act and may act in the future as
investment manager or adviser to fiduciary and other managed accounts, and
as investment manager or adviser to other investment companies, including
any offshore entities, or accounts, and the Trust has no objection to the
Adviser so acting, provided that whenever the Trust and one or more other
investment companies or accounts managed or advised by the Adviser have
available funds for investment, investments suitable and appropriate for
each will be allocated in accordance with a formula believed to be equitable
to each company and account. The Trust recognizes that in some cases this
procedure may adversely affect the size of the positions obtainable and the
prices realized for the Trust.
12. Non-Exclusivity. The Trust understands that the persons employed by
the Adviser to assist in the performance of the Adviser's duties under this
Agreement will not devote their full time to such service and nothing
contained in this Agreement shall be deemed to limit or restrict the right
of the Adviser or any affiliate of the Adviser to engage in and devote time
and attention to other businesses or to render services of whatever kind or
nature. The Trust further understands and agrees that officers or directors
of the Adviser may serve as officers or trustees of the Trust, and that
officers or trustees of the Trust may serve as officers or directors of the
Adviser to the extent permitted by law; and that the officers and directors
of the Adviser are not prohibited from engaging in any other business
activity or from rendering services to any other person, or from serving as
partners, officers, directors or trustees of any other firm or trust,
including other investment advisory companies.
13. Effective Date, Term and Approval. This Agreement shall become
effective with respect to the Trust, if approved by the shareholders of the
Trust, on the date indicated above. If so approved, this Agreement shall
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thereafter continue in force and effect until two years after the date
indicated above, and may be continued from year to year thereafter, provided
that the continuation of the Agreement is specifically approved at least
annually:
(a) (i) by the Board of Trustees or (ii) by the vote of "a majority of
the outstanding voting securities" of the Trust (as defined in
Section 2(a)(42) of the 0000 Xxx); and
(b) by the affirmative vote of a majority of the trustees who are not
parties to this Agreement or "interested persons" (as defined in the 0000
Xxx) of a party to this Agreement (other than as trustees of the Trust), by
votes cast in person at a meeting specifically called for such purpose.
14. Termination. This Agreement may be terminated as to the Trust at any
time, without the payment of any penalty, by vote of the Board of Trustees or
by vote of a majority of the outstanding voting securities of the Trust, or by
the Adviser, on sixty (60) days' written notice to the other party. The notice
provided for herein may be waived by the party entitled to receipt thereof.
This Agreement shall automatically terminate in the event of its assignment,
the term "assignment" for purposes of this paragraph having the meaning defined
in Section 2(a)(4) of the 1940 Act.
15. Amendment. No amendment of this Agreement shall be effective unless it
is in writing and signed by the party against which enforcement of the
amendment is sought.
16. Liability of Adviser and Trust. In the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Adviser or any of its officers, directors or
employees, the Adviser shall not be subject to liability to the Trust or to the
Funds or to any shareholder of the Trust for any act or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security.
17. Liability of Shareholders. Notice is hereby given that, as provided by
applicable law, the obligations of or arising out of this Agreement are not
binding upon any of the shareholders of the Trust individually but are binding
only upon the assets and property of the Trust and that the shareholders shall
be entitled, to the fullest extent permitted by applicable law, to the same
limitation on personal liability as shareholders of private corporations for
profit.
18. Notices. Any notices under this Agreement shall be in writing, addressed
and delivered, telecopied or mailed postage paid, to the other party entitled
to receipt thereof at such address as such party may designate for the receipt
of such notice. Until further notice to the other party, it is agreed that the
address of the Trust and the Adviser shall be 0000 Xxxxxxxxx Xxxxxx, X.X.,
Xxxxxxx, Xxxxxxx 00000.
19. Questions of Interpretation. Any question of interpretation of any term
or provision of this Agreement having a counterpart in or otherwise derived
from a term or provision of the 1940 Act or the Advisers Act shall be resolved
by reference to such term or provision of the 1940 Act or the Advisers Act and
to interpretations thereof, if any, by the United States Courts or in the
absence of any controlling decision of any such court, by rules, regulations or
orders of the SEC issued pursuant to said Acts. In addition, where the effect
of a requirement of the 1940 Act or the Advisers Act reflected in any provision
of the Agreement is revised by rule, regulation or order of the SEC, such
provision shall be deemed to incorporate the effect of such rule, regulation or
order. Subject to the foregoing, this Agreement shall be governed by and
construed in accordance with the laws (without reference to conflicts of law
provisions) of the State of Texas.
20. License Agreement. The Trust shall have the non-exclusive right to use
the name "Invesco" to designate any current or future series of shares only so
long as Invesco Advisers, Inc. serves as investment manager or adviser to the
Trust with respect to such series of shares.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers on the day and year first
written above.
INVESCO XXX XXXXXX HIGH INCOME TRUST II
Attest:
/s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxx
---------------------- ----------------------
Assistant Secretary Name: Xxxx X. Xxxx
Title: Senior Vice President
(SEAL)
Attest: INVESCO ADVISERS, INC.
/s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxx
---------------------- ----------------------
Assistant Secretary Name: Xxxx X. Xxxx
Title: Senior Vice President
(SEAL)
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APPENDIX A
COMPENSATION TO THE ADVISER
The Trust shall pay the Adviser, out of its assets, as full compensation for
all services rendered, an advisory fee for the Trust set forth below. Such fee
shall be calculated by applying the following annual rates to the average daily
managed assets of the Trust for the calendar year.
TRUST NAME ADVISORY FEE RATE
---------- ------------------------
Invesco Xxx Xxxxxx High
Income Trust II .700% on managed assets
"Managed assets" for this purpose means the Trust's net assets, plus assets
attributable to outstanding preferred shares and the amount of any borrowings
incurred for the purpose of leverage (whether or not such borrowed amounts are
reflected in the Trust's financial statements for purposes of generally
accepted accounting principles).
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