SERVICE AGREEMENT
This Agreement is made as of the 18th day of June, 1999, by and between
INVESCO Funds Group, Inc. (INVESCO"), a Delaware corporation, and Great-West
Life & Annuity Insurance Company ("Great-West"), a Colorado corporation,
collectively, the "Parties."
WITNESSETH:
WHEREAS INVESCO and its wholly-owned subsidiaries serve as the adviser,
administrator, and distributor for the INVESCO Variable Investment Funds, Inc.
(the "Company"); and
WHEREAS Great-West has entered into a Fund Participation Agreement, dated
June 18, 1999, with the Company and INVESCO (the "Participation Agreement")
pursuant to which INVESCO will make shares of the Company's Portfolios(1)
available to certain variable life insurance and/or variable annuity contracts
offered by Great-West through certain separate accounts (the "Separate
Accounts") at net asset value and with no sales charges, subject to the terms of
the Participation Agreement; and
WHEREAS the 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 Participation Agreement provides that the Company, at its
expense, will provide Great-West with camera ready copies or copies suitable for
duplication of all Fund Materials with respect to prospective Variable Contract
Owners of Great-West; and
WHEREAS the Participation Agreement makes no specific provision for certain
administrative expenses which Great-West will incur 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 expense;
NOW THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Parties hereto agree as follows:
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(1) The Company is an open-end, diversified, no-load management investment
company currently consisting of ten (10) portfolios of investments: the INVESCO
Variable Blue Chip Growth, INVESCO Variable Dynamics, INVESCO Variable Equity
Income, INVESCO Variable Health Sciences, INVESCO Variable High Yield, INVESCO
Variable Realty, INVESCO Variable Small Company Growth, INVESCO Variable
Technology, INVESCO Variable Total Return and INVESCO Variable Utilities Funds
(the "Funds"). Additional Funds may be offered in the future.
I. SERVICES PROVIDED:
Great-West agrees to provide services to the Company and INVESCO including the
following:
a) responding to inquiries from Great-West Contract Owners who allocate their
contributions to the investment divisions which correspond with one or more
of the Portfolios, regarding to the services performed by Great-West 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) facilitate the printing and mailing of shareholder communications from
INVESCO or the Company as may be required pursuant to the terms of the
Participation Agreement;
d) communication directly with Contract Owners concerning INVESCO or the
Company's operations; and
e) providing other similar services, as agreed to in writing by the parties.
II. PAYMENT OF EXPENSES,:
In recognition of the substantial savings in administrative expenses to INVESCO
and the Company by virtue of having a sole shareholder, Great-West, and having
that shareholder be responsible for the servicing of the Contract Owners,
INVESCO will pay an administrative service fee to Great-West, as described
below:
a) INVESCO shall pay to Great-West a quarterly fee (hereinafter, the
"Quarterly Fee") equal to a percentage of the average daily net assets of
the Portfolio attributable to COLI VUL Series Account 2, at the annual rate
of .25% on the aggregate net assets of the INVESCO Variable Investment
Funds, Inc, in connection with the expenses incurred by Great-West under
Section II hereof. The payment of the Quarterly Fee shall commence as of
the stated effective date of this Agreement but shall be payable only on
each Portfolio which has reached $30 million in total net assets.
b) INVESCO shall pay to Great-West a quarterly fee (hereinafter, the
"Quarterly Fee") equal to a percentage of the average daily net assets of
the Portfolio attributable to the FutureFunds Series Accounts, at the
annual rate of .35% on the aggregate net assets of the INVESCO Variable
Investment Funds, Inc, in connection with the expenses incurred by
Great-West under Section II hereof. The payment of the Quarterly Fee shall
commence as of the stated effective date of this Agreement but shall be
payable only on each Portfolio which has reached $30 million in total net
assets.
c) 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 Great-West 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.
d) This Agreement shall not modify any of the provisions of Schedule D of the
Participation Agreement, but shall supplement those provisions.
III. TERM OF AGREEMENT
This Agreement shall continue in effect for so long as Great-West 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.
IV. INDEMNIFICATION:
(a) Great-West agrees to indemnity and hold harmless the, INVESCO and their
officers and directors, from any and all loss, liability and expense
resulting from the gross negligence or willful wrongful act of Great-West
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
the Company or INVESCO in the performance of its duties, or by reason of
the reckless disregard of their obligations and duties under this
Agreement.
(b) INVESCO agree to indemnify and hold harmless Great-West and its officers
and directors from any and all loss, liability and expense resulting from
the gross negligence or willful wrongful act of 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
Great-West in the performance of its duties, or by reason of the reckless
disregard of its obligations and duties under this Agreement.
V. NOTICES:
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 Xxxx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx - Senior Vice President
FAX: 000 000-0000
Great-West Life & Annuity Insurance Company
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxxxx - Vice President Insurance Markets
FAX: 000 000-0000
VI. APPLICABLE LAW:
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 Colorado law, without
regard for that state's principles of conflict of laws.
VII. EXECUTION IN COUNTERPARTS:
This Agreement may be executed simultaneously in two or more counterparts, each
of which taken together will constitute one and the same instrument.
VIII. SEVERABILITY:
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.
IX. RIGHTS CUMULATIVE:
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.
X. HEADINGS
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
GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxxxxxxxxx
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Xxxxxx Xxxxxxxxxxxx
Vice President Insurance Markets
