DISTRIBUTION SERVICES AGREEMENT
Exhibit h2b
Princor
Financial Services Corporation, (“Princor”) and A I M DISTRIBUTORS, (“Distributor”)
(collectively, the “Parties”) mutually agree to the arrangements set forth in this Distribution
Services Agreement (this “Agreement”) dated October 1,2002.
WHEREAS, Distributor is the underwriter to AIM Variable Insurance Funds (the “Fund”);
WHEREAS, Distributor has entered into an Amended and Restated Master Distribution Agreement,
dated June 13, 2001, with the Fund (the “Master Agreement”);
WHEREAS, the Fund has adopted a Master Distribution Plan pursuant to Rule 12b-l under the
Investment Company Act of 1940 (the “Plan”), and has created a class of shares designated “Series
II shares,” which are subject to the Plan;
WHEREAS, Distributor has agreed to provide, or arrange to provide, certain distribution
services, including such services as may be requested by the Fund’s Board of Trustees from time to
time, in connection with the Series II shares (“Fund shares”);
WHEREAS, Princor issues variable life insurance policies and/or variable annuity contracts
(collectively, the “Contracts”);
WHEREAS, Princor has entered into a participation agreement, dated June 8, 1999, (the
“Participation Agreement”) with the Fund, pursuant to which the Fund has agreed to make shares of
certain of its portfolios (“Portfolios”) available for purchase by one or more of Princor’s
separate accounts or divisions thereof (each, a “Separate Account”), in connection with the
allocation by Contract owners of purchase payments to corresponding investment options offered
under the Contracts;
WHEREAS, Princor and Distributor expect that the Fund and its Portfolios can derive certain
benefits from performance of the distribution services listed on Schedule A hereto for the Fund in
connection with the Contracts issued by Princor;
WHEREAS, Princor has no contractual or other legal obligation to perform such distribution
services, other than pursuant to this Agreement and the Participation Agreement;
WHEREAS, Princor desires to be compensated for providing such distribution services; and
WHEREAS, Distributor desires to retain the distribution services of Princor and to compensate
Princor for providing such distribution services;
NOW, THEREFORE, the Parties agree as follows:
Section 1. Distribution Services; Payments Therefor.
(a) Princor shall provide the distribution services set out in Schedule A, attached hereto and
made a part hereof, as the same may be amended from time to time. For such services, Distributor
agrees to pay to
a quarterly fee (the “Distribution Fee”) equal to 0.25% of the average daily net assets of the Fund
attributable to the Contracts issued by Princor.
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(b) Distributor shall calculate the Distribution Fee at the end of each calendar quarter and
will make such payment to Princor, without demand or notice by Princor, within 30 days thereafter,
in a manner mutually agreed upon by the Parties from time to time.
(c) From time to time, the Parties shall review the Distribution Fee to determine whether it
exceeds or is reasonably expected to exceed the incurred and anticipated costs, over time, of
Princor. The Parties agree to negotiate in good faith a reduction to the Distribution Fee as
necessary to eliminate any such excess or as necessary to reflect a reduction in the fee paid by
the Fund to Distributor pursuant to the Plan.
Section 2. Nature of Payments.
The Parties to this Agreement recognize and agree that Distributor’s payments hereunder are
for distribution services only and do not constitute payment in any manner for investment advisory
services or for administrative services, and are not otherwise related to investment advisory or
administrative services or expenses, recognizing that Princor may have contracted separately with
AIM Advisors, Inc., to provide administrative services to the Fund. Princor represents and
warrants that the fees to be paid by Distributor for services to be rendered by Princor pursuant
to the terms of this Agreement are to compensate the Princor only for providing distribution
services to the Fund, do not reimburse or compensate Princor for providing distribution services
with respect to the Contracts or any Separate Account, and are not duplicative of any services
that provides to the Fund pursuant to any administrative services or other agreement.
Section 3. Reports.
Princor acknowledges that Distributor is obligated to provide to the Fund’s Board of
Trustees, at least quarterly, a written report of the amounts expended pursuant to the Plan and
this Agreement and the purposes for which such expenditures were made. Accordingly, Princor agrees
to provide Distributor with such assistance as Distributor may reasonably request so that
Distributor can report such information to the Fund’s Board in a timely manner. Princor
acknowledges that such information and assistance shall be in addition to the information and
assistance required of Princor pursuant to the Fund’s mixed and shared funding SEC exemptive
order, described in the Participation Agreement.
Princor further agrees to provide Distributor with such assistance as Distributor may
reasonably request with respect to the preparation and submission of reports and other documents
pertaining to the Fund to appropriate regulatory bodies and third party reporting services.
Section 4. Term and Termination.
(a) This Agreement shall continue in effect for a period of more than one year from the date
of its execution only so long as such continuance is specifically approved by a vote of the Board
of Trustees of the Fund, and of the Trustees who are not interested persons of the Fund and have
no direct or indirect financial interest in the operation of the Plan or in any agreements related
to the Plan, person at a meeting called for the purpose of voting on the Plan or agreements.
(b) Any Party may terminate this Agreement, without the payment of any penalty, on not more
than 60 days’ written notice to the other Party. This Agreement may be terminated at any time by a
vote of a majority of the members of the Board of Trustees of the Fund who are not interested
persons of the Fund and have no direct or indirect financial interest in the operation of the Plan
or any agreements related to the Plan or by a vote of a majority of the outstanding voting
securities of the Fund.
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(c) This Agreement shall automatically terminate in the event of its assignment.
Section 5. Amendment; Katire Agreement.
This Agreement may be amended upon mutual agreement of the Parties in writing. However, the
Parties recognize that the Plan that this Agreement implements may not be amended to increase
materially the amount to be spent for distribution without shareholder approval and that all
material amendments of the Plan must be approved by a vote of the Board of Trustees of the Fund,
and of the Trustees who are not interested persons of the Fund and have no direct or indirect
financial interest in the operation of the Plan or in any agreements related to the Plan, cast in
person at a meeting called for the purpose of voting the Plan or agreements. This Agreement,
together with Schedule A hereto, constitutes the sole agreement between the Parties regarding the
distribution services listed on Schedule A hereto.
Section 6. Notices
All notices, requests, demands and other communications hereunder shall be in writing and
shall be deemed to have been duly given if delivered:
| PRINCOR FINANCIAL SERVICES CORPORATION | ||
| 000 Xxxx Xxxxxx | ||
| Xxx Xxxxxx,Xxxx 00000-0000 | ||
| Facsimile: (000) 000-0000 | ||
| Attention: Xxxxx Xxxxx, Esq. | ||
| A I M DISTRIBUTOR, INC. | ||
| 00 Xxxxxxxx Xxxxx, Xxxxx 000 | ||
| Xxxxxxx, Xxxxx 00000 | ||
| Facsimile: (713) 000-00 00 | ||
| Attention: Xxxxx L, Xxxxxx,Esquire |
Section 7. Miscellaneous
(a) Successors and Assigns. This Agreement shall be binding upon the Parties and
their transferees, successors and permitted assigns. The benefits of and the right to enforce this
Agreement shall accrue to the Parties and their transferees, successors and assigns.
(b) Intended Beneficiaries. Nothing in this Agreement shall be construed to give any
person or entity other than the Parties, as well as the Fund, any legal or equitable claim, right
or remedy. Rather, this Agreement is intended to be for the sole and exclusive benefit of the
Parties, as well as the Fund.
(c) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which shall together constitute one and the same
instrument.
(d) Applicable Law. This Agreement shall be interpreted, construed, and enforced
accordance with the laws of the State of Delaware without reference to the conflict of law
principles thereof.
(e) Severability.
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(i) This Agreement shall be severable as it applies to each Fund Portfolio, and action
on any matter shall be taken separately for each Fund Portfolio affected by the matter.
(ii) If any portion of this Agreement shall be found to be invalid or unenforceable by a
court or tribunal or regulatory agency of competent jurisdiction, the remainder shall not be
affected thereby, but shall have the same force and effect as if the invalid or unenforceable
portion had not been inserted.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date of first above
written.
| PRINCOR FINANCIAL SERVICES CORPORATION | ||
| Name: /s/ Art Filean | ||
| Title: Senior Vice President | ||
| A I M DISTRIBUTORS, INC. | ||
| Name: /s/ Xxxxxxx X. Xxxx | ||
| Title: President |
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SCHEDULE A
Distribution Services For
AIM Variable Insurance Funds
AIM Variable Insurance Funds
Princor shall provide certain distribution services that are primarily intended to result in
the sale of Fund shares, as set forth below. This Schedule, which may be amended from time to time
as mutually agreed upon by and Distributor, constitutes an integral part of the Agreement to which
it is attached. Capitalized terms used herein shall, unless otherwise noted, have the same meaning
as the defined terms in the Agreement to which relates.
Distribution services shall include without limitation:
a) The development, preparation, printing and distribution of advertisements and
sales literature and other promotional materials describing relating to the Fund;
b) Training sales personnel regarding the Fund;
c) Organizing and conducting seminars and sales meetings designed to promote the
distribution of Fund shares;
d) Compensating financial intermediaries and broker-dealers to pay or reimburse them
for their services or expenses in connection with the distribution of variable
annuity and variable life insurance contracts investing directly in Fund shares; and
e) Compensating sales personnel in connection with the allocation of cash values
and premium of variable annuity and variable insurance contracts to investments in Fund shares.
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