ADMINISTRATIVE SERVICES AGREEMENT
This Agreement is made as of the 17th day of November, 1999, by and between
INVESCO Funds Group, Inc. ("INVESCO"), and Cova Financial Life Insurance
Company, and Cova Financial Services Life Insurance Company (collectively
"Cova").
WITNESSETH:
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WHEREAS, INVESCO serves as the administrator for the INVESCO Variable
Investment Funds, Inc. (the "Company"); and
WHEREAS, Cova has entered into an agreement, dated 11/17/99, with the
Company, and INVESCO (the " Fund Participation Agreement") pursuant to which
INVESCO will make shares of certain of its Portfolios available to certain
variable life insurance and/or variable annuity contracts offered by Cova
through certain separate accounts (the "Separate Accounts") at net asset value
and with no sales charges, subject to the terms of the Fund Participation
Agreement; and
WHEREAS, the Fund Participation Agreement provides that the Company will
bear the costs of preparing, filing with the Securities and Exchange Commission,
printing or duplicating and mailing the Company's (or the Portfolios')
prospectus, statement of additional information and any amendments or
supplements thereto, periodic reports to shareholders, Fund proxy material and
other shareholder communications (collectively, the "Fund Materials") required
by law to be sent to owners of Contracts ("Contract Owners") who have allocated
any Contract value to a Portfolio; and
WHEREAS, the Fund Participation Agreement provides that Cova, at its
expense, will provide various administrative and shareholder contact services
with respect to prospective and actual Variable Contract Owners of Cova; and
WHEREAS, the Fund Participation Agreement makes no provision for the rate
at which each party shall incur expenses in connection with the servicing of
Contract Owners who have allocated Contract value to a portfolio, including, but
not limited to, responding to various Contract Owner inquiries regarding a
Portfolio; and
WHEREAS, the Parties hereto wish to allocate the expenses in a manner that
is fair and equitable, and consistent with the best interests of Contract
Owners; and
WHEREAS, the Parties hereto wish to establish a means for allocating the
expenses that does not entail the expense and inconvenience of separately
identifying and accounting for each item of Fund expense;
NOW THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Parties hereto agree as follows:
I. SERVICES PROVIDED
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Manulife USA agrees to provide services to the Company and INVESCO including the
following:
a) responding to inquiries from Cova Contract Owners using one or more of the
Portfolios as an investment vehicle regarding the services performed by
Cova as they relate to INVESCO, the Company or its Portfolios;
b) providing information to INVESCO or the Company and to Contract Owners with
respect to shares attributable to Contract Owner accounts;
c) communicating directly with Contract Owners concerning INVESCO or the
Company's operations;
e) providing such similar services as INVESCO or the Company may reasonably
request to the extent permitted or required under applicable statutes,
rules and regulations.
II. EXPENSE ALLOCATIONS
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Subject to Section III hereof, and the provisions of Article IV of the Fund
Participation Agreement, Cova or its affiliates shall initially bear the costs
of the following:
a) printing and distributing all Fund Materials to be distributed to
prospective Contract Owners except as may otherwise be provided in the Fund
Participation Agreement;
b) printing and distributing all sales literature or promotional material
developed by Cova or its affiliates and relating to the Contracts;
c) servicing Contract Owners who have allocated Contract value to a Portfolio,
which servicing shall include, but is not limited to, the items listed in
Paragraph I of this Agreement.
Ill. PAYMENT OF EXPENSES
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In recognition of the substantial savings in administrative expenses to INVESCO
and the Company by virtue of having a sole shareholder, Cova, and having that
shareholder be responsible for the servicing of the Contract Owners, INVESCO
will pay an administrative service fee to Cova, as described below:
a) INVESCO shall pay to Cova and Administrative Services Fee (hereinafter, the
"Quarterly Fee") equal to a percentage of the average daily net assets of
the Portfolio attributable to Contracts offered by Cova, at the annual rat
e of 0.25% on the aggregate net assets placed by Cova in the INVESCO VIF
Funds desiganted in Shcedule B of the Fund Partcipation Agreement, as may
be amended from time to time. The Quarterly Fee is in consideration of the
expenses incurred by Cova pursuant to Section II hereof. The payment of the
Feee shall commence on the date first indicated above.
b) From time to time, the Parties hereto shall review the Quarterly Fee to
determine whether it reasonably approximates the incurred and anticipated
costs, over time, of Manulife USA in connection with its duties hereunder.
The Parties agree to negotiate in good faith any change to the Quarterly
Fee proposed by another Party in good faith.
c) This Agreement shall not modify any of the provisions of Article IV or
Article VI of the Fund Participation Agreement, but shall supplement those
provisions.
IV. TERM OF AGREEMENT
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This Agreement shall continue in effect for so long as Cova or its successor(s)
in interest, or any affiliate thereof, continues to hold shares of the Company
or its Portfolios, and continues to perform in a similar capacity for the
Company and INVESCO.
V. INDEMNIFICATION:
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(a) Coca agrees to indemnify and hold harmless the Company and INVESCO, and
their officers, employees, and directors, from any and all loss, liability
and expense resulting from the gross negligence or willful wrongful act of
the Company or INVESCO under this Agreement, except to the extent such
loss, liability or expense is the result of the willful misfeasance, bad
faith or gross negligence of Cova in the performance of its duties, or by
reason of the reckless disregard of its obligations and duties under this
Agreement.
(b) The Company and INVESCO agree to indemnify and hold harmless Cova and its
officers, employees, and directors from any and all loss, liability and
expense resulting from the gross negligence or willful wrongful act of the
Company or INVESCO under this Agreement, except to the extent such loss,
liability or expense is the result of the willful misfeasance, bad faith or
gross negligence of Cova in the performance of its duties, or by reason of
the reckless disregard of its obligations and duties under this Agreement.
VI. NOTICES:
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Notices and communications required or permitted hereby will be given to the
following persons at the following addresses and facsimile numbers, or such
other persons, addresses or facsimile numbers as the Party receiving such
notices or communications may subsequently direct in writing: INVESCO Funds
Group, Inc.
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
Cova Financial Services Life Insurance Company
Xxx Xxxxx Xxxx
Xxxxx 0000
Xxxxxxxx Xxxxxxx XX 00000
Attention: General Counsel
VII. APPLICABLE LAW
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Except insofar as the Investment Company Act of 1940 or other federal laws and
regulations may be controlling, this Agreement will be construed and the
provisions hereof interpreted under and in accordance with Delaware law, without
regard for that state's principles of conflict of laws.
VIII. EXECUTION IN COUNTERPARTS
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This Agreement may be executed simultaneously in two or more counterparts, each
of which taken together will constitute one and the same instrument.
IX. SEVERABILITY
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If any provision of this Agreement is held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement will not be affected
thereby.
X. RIQHTS CUMULATIVE
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The rights, remedies and obligations contained in this Agreement are cumulative
and are in addition to any and all rights, remedies and obligations, at law or
in equity, that the Parties are entitled to under federal and state laws.
XI. HEADINGS
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The headings used in this Agreement are for purposes of reference only and shall
not limit or define the meaning of the provisions of this Agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
in their names and on their behalf by and through their duly authorized officers
signing below.
INVESCO FUNDS GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Senior Vice President & Treasurer
INVESCO VARIABLE INVESTMENT FUNDS, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Treasurer
COVA FINANCIAL SERVICES INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Assistant Vice President
COVA FINANCIAL LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Assistant Vice President
