Sub-Item 77Q1(e)
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this 1st day of June, 2010, by and between the
registered investment companies as set forth on Appendix I (each, a "Fund" and
collectively, the "Funds"), as the same may be amended from time to time, and
Invesco Advisers, Inc., a Delaware corporation (the "Adviser").
RECITALS
WHEREAS, each Fund 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, each Fund and the Adviser desire to enter into an agreement to
provide for investment advisory services to the Funds 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 Funds and shall, in such capacity, supervise all aspects of the Funds'
operations, including the investment and reinvestment of cash, securities
or other properties comprising the Funds' assets, subject at all times to
the policies and control of the Board of Trustees/Directors of each Fund
(the "Board of Trustees/Directors"). The Adviser shall give each Fund the
benefit of its best judgment, efforts and facilities in rendering its
services as investment adviser.
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 Funds;
(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
Funds, and whether concerning the individual issuers whose securities
are included in the assets of the Funds or the activities in which
such issuers engage, or with respect to securities which the Adviser
considers desirable for inclusion in the Funds' assets;
(c) determine which issuers and securities shall be represented
in the Funds' investment portfolios and regularly report thereon to
the Board of Trustees/Directors;
(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/Directors; and
(e) take, on behalf of each Fund, all actions which appear to the
Funds 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
Funds.
3. Securities Lending Duties and Fees. The Adviser agrees to provide
the following services in connection with the securities lending activities
of each Fund: (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/Directors; (d) prepare appropriate periodic reports
for, and seek appropriate approvals from, the Board of Trustees/Directors
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 of each Fund, a lending Fund
shall pay the Adviser a fee equal to 25% of the net monthly interest or fee
income retained or paid to the Fund 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-advisors, 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/Directors 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-advisors 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 each Fund in any way or otherwise be deemed to be an agent
of each Fund.
6. Control by Board of Trustees/Directors. 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/Directors.
7. Compliance with Applicable Requirements. In carrying out its
obligations under this Agreement, the Advisor 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 each Fund, as
the same may be amended from time to time under the Securities Act of
1933 and the 1940 Act;
(c) the provisions of each Fund's Articles of Incorporation or
Declaration of Trust, as applicable, (together, the "Declaration") as
the same may be amended from time to time;
(d) the provisions of the by-laws of each Fund, 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 Funds, 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 Funds on a
continuing basis. Accordingly, the price to the Funds 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/Directors
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 Funds
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 the brokerage and research
services provided by
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such broker or dealer, viewed in terms of either that particular
transaction or the Adviser's overall responsibilities with respect to
a particular Fund 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 Funds
to such brokers and dealers who also provide research or statistical
material, or other services to the Funds, to the Adviser, or to any
sub-advisor. 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/Directors indicating
the brokers to whom such allocations have been made and the basis
therefor.
(d) With respect to one or more Funds, to the extent the Adviser
does not delegate trading responsibility to one or more sub-advisors,
in making decisions regarding broker-dealer relationships, the Adviser
may take into consideration the recommendations of any sub-advisor
appointed to provide investment research or advisory services in
connection with the Funds, and may take into consideration any
research services provided to such sub-advisor 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 Funds are affiliated.
9. Compensation. The compensation that each Fund shall pay the Adviser
is set forth in Appendix II attached hereto.
10. Expenses of the Funds. All of the ordinary business expenses
incurred in the operations of the Funds and the offering of their shares
shall be borne by the Funds unless specifically provided otherwise in this
Agreement. These expenses borne by the Funds 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 Funds in connection with membership in
investment company organizations and the cost of printing copies of
prospectuses and statements of additional information distributed to the
Funds' shareholders.
11. Services to Other Companies or Accounts. Each Fund 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 each Fund has no
objection to the Adviser so acting, provided that whenever a Fund 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. Each Fund recognizes
that in some cases this procedure may adversely affect the size of the
positions obtainable and the prices realized for the Funds.
12. Non-Exclusivity. Each Fund 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. Each Fund further understands and agrees that officers or directors
of the Adviser may serve as officers or trustees of a Fund, and that
officers or trustees of the Funds 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 a Fund, if approved by the shareholders of such
Fund, on the Effective Date for such Fund, as set forth in Appendix I
attached hereto. If so approved, this Agreement shall thereafter continue
in force and effect with respect to a
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Fund for two years, 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 Fund's Board of Trustees/Directors or (ii) by the
vote of "a majority of the outstanding voting securities" of such Fund
(as defined in Section 2(a)(42) of the 0000 Xxx); and
(b) by the affirmative vote of a majority of the Fund's
directors/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 directors/trustees of the Fund), by votes
cast in person at a meeting specifically called for such purpose.
14. Termination. This Agreement may be terminated as to a Fund at any
time, without the payment of any penalty, by vote of the Fund's Board of
Trustees/Directors or by vote of a majority of the outstanding voting
securities of the applicable Fund, 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 Fund. 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 a Fund or to any shareholder of such Fund 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. Any liability of the Adviser to one Fund shall not
automatically impart liability on the part of the Adviser to any other
Fund. No Fund shall be liable for the obligations of any other Fund.
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 a Fund
individually but are binding only upon the assets and property of the Fund
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. Limited Liability of Massachusetts Business Trusts. The
Declaration of Trust, together with all amendments thereto establishing
each Fund identified in Appendix I as a Massachusetts business trust (the
"Declaration"), is on file in the office of the Secretary of the
Commonwealth of Massachusetts, provides that the name of such Funds refers
to the Trustees under the Declaration collectively as Trustees, but not as
individuals or personally; and no Trustee, shareholder, officer, employee
or agent of such Funds shall be held to any personal liability, nor shall
resort be had to their private property for the satisfaction of any
obligation or claim or otherwise, in connection with the affairs of such
Funds, but the Trust Estate only shall be liable.
19. 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 each Fund and that of the Adviser
shall be 00 Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000-0000.
20. 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
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governed by and construed in accordance with the laws (without reference to
conflicts of law provisions) of the State of Texas.
21. License Agreement. Each Fund 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 Fund 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.
ON BEHALF OF EACH FUND LISTED IN
APPENDIX I
Attest: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxx X. Xxxx
----------------------------- -----------------------------------
Name: Xxxxxxx X. Xxxxx Name: Xxxx X. Xxxx
Title: Assistant Secretary Title: Senior Vice President
(SEAL)
INVESCO ADVISERS, INC.
Attest: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxx Xxxxxxxx
----------------------------- -----------------------------------
Name: Xxxxxxx X. Xxxxx Name: Xxxx Xxxxxxxx
Title: Assistant Secretary Title: Senior Vice President
(SEAL)
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APPENDIX I
FUNDS AND EFFECTIVE DATES
All of the Funds referenced below are organized as Massachusetts business
trusts.
EFFECTIVE DATE OF
NAME OF FUND ADVISORY AGREEMENT
------------ ------------------
Invesco California Insured Municipal Income Trust June 1, 0000
Xxxxxxx Xxxxxxxxxx Quality Municipal Securities June 1, 2010
Invesco Insured California Municipal Securities June 1, 2010
Invesco Insured Municipal Bond Trust June 1, 2010
Invesco Insured Municipal Income Trust June 1, 2010
Invesco Insured Municipal Securities June 1, 2010
Invesco Insured Municipal Trust June 1, 2010
Invesco Municipal Income Opportunities Trust June 1, 2010
Invesco Municipal Income Opportunities Trust II June 1, 2010
Invesco Municipal Income Opportunities Trust III June 1, 2010
Invesco Municipal Premium Income Trust June 1, 2010
Invesco New York Quality Municipal Securities June 1, 2010
Invesco Prime Income Trust June 1, 2010
Invesco Quality Municipal Income Trust June 1, 2010
Invesco Quality Municipal Investment Trust June 1, 2010
Invesco Quality Municipal Securities June 1, 2010
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APPENDIX II
COMPENSATION TO THE ADVISER
Each Fund shall pay the Adviser, out of the assets of the Fund, as full
compensation for all services rendered, an advisory fee for such Fund set forth
below.
FUND ANNUAL RATE
---- --------------------------------------------------
Invesco California Insured Municipal Income Trust 0.27% as a percentage of average weekly net
assets*
Invesco California Quality Municipal Securities 0.27% as a percentage of average weekly net
assets*
Invesco Insured California Municipal Securities 0.27% as a percentage of average weekly net assets
Invesco Insured Municipal Bond Trust 0.27% as a percentage of average weekly net
assets*
Invesco Insured Municipal Income Trust 0.27% as a percentage of average weekly net
assets*
Invesco Insured Municipal Securities 0.27% as a percentage of average weekly net assets
Invesco Insured Municipal Trust 0.27% as a percentage of average weekly net
assets*
Invesco Municipal Income Opportunities Trust 0.50% as a percentage of average weekly net assets
Invesco Municipal Income Opportunities Trust II 0.50% as a percentage of average weekly net assets
Invesco Municipal Income Opportunities Trust III 0.50% as a percentage of average weekly net assets
Invesco Municipal Premium Income Trust 0.40% as a percentage of average weekly net
assets*
Invesco New York Quality Municipal Securities 0.27% as a percentage of average weekly net
assets*
Invesco Prime Income Trust 0.90% of the portion of the daily net assets not
exceeding $500 million; 0.85% of the portion of
the daily net assets exceeding $500 million but
not exceeding $1.5 billion; 0.825% of the portion
of the daily net assets exceeding $1.5 billion but
not exceeding $2.5 billion; 0.80% of the portion
of the daily net assets exceeding $2.5 billion,
but not exceeding $3 billion; and 0.775% of the
portion of the daily net assets in excess of $3
billion
Invesco Quality Municipal Income Trust 0.27% as a percentage of average weekly net
assets*
Invesco Quality Municipal Investment Trust 0.27% as a percentage of average weekly net
assets*
Invesco Quality Municipal Securities 0.27% as a percentage of average weekly net
assets*
----------
* For the purpose of calculating the advisory fee, the liquidation preference
of any Preferred Shares issued by the Fund will not be deducted from the
Fund's total assets. In addition, an amount up to the aggregate amount of
any other borrowings may be included in the Fund's advisory fee
calculation.
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