Form N-4, Item 24(b)
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EXHIBIT 8.10
Form of Participation Agreement
with INVESCO Funds Group and
American United Life Insurance Company
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INVESCO FUNDS
OMNIBUS ACCOUNT SERVICES AGREEMENT
This Agreement is made as of May 16th,, 2001, between INVESCO FUNDS GROUP, INC.
AND INVESCO DISTRIBUTORS, INC. (COLLECTIVELY, THE "FUND PARTY"), Delaware
Corporations, and American United Life Insurance Company ("Agent").
WHEREAS, the terms and conditions set forth herein apply to fund
transactions effected on behalf of direct customers of Agent;
WHEREAS, it is understood that Agent performs traditional operational
functions, including execution and clearance of trades and holding customer
funds and securities;
WHEREAS, Agent will execute orders for new shares free of transaction
charges to the investor ("Program Shares");
WHEREAS, the Fund Party wishes to have Agent perform certain distribution,
recordkeeping, shareholder communication, administrative and other services for
the funds listed on Schedule I (the "Funds");
WHEREAS, such services will be performed pursuant to the terms and
conditions as set forth herein;
WHEREAS, both the Fund Party and Agent agree to transact business in the
manner prescribed in Schedule II attached hereto;
NOW THEREFORE, in consideration of the foregoing and the mutual promises
set forth below, the parties agree as follows:
1. SERVICES.
During the term of this Agreement, Agent will perform services as set forth
in Schedule III attached hereto (the "Services"). Such Schedule may be amended
from time to time with mutual consent of the parties.
2. FEES.
a. For performance of Services, Agent shall receive a fee (the "Fee") which
will be calculated and paid as provided in Schedule IV attached hereto. Fees are
solely for shareholder servicing and other administrative services provided by
Agent and do not constitute payment in any manner for investment advisory,
trustee, or custodial services.
b. Fund Party represents that fees paid to Agent will be paid out of
transfer agency, Rule 12b-1, management or other fees or expenses presently
being charged to the Funds pursuant to the terms of their current prospectuses,
or out of Fund Party's profits or any other non-Fund source legally available to
Fund Party.
c. In the event that Schedule III is revised, the parties agree, in good
faith, to negotiate a revision of fees set forth in Schedule IV.
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3. TRANSACTION CHARGES.
Agent shall not, during the term of this Agreement, assess against or
collect from, customers, any transaction fee upon the purchase or redemption of
any Fund's shares, except as noted in section 4 below. Customer purchases not
meeting the criteria as set forth herein may be charged a transaction fee by the
Agent, as the case may be, and will not be included in service fee invoices
presented to the Funds for payment.
4. SHORT-TERM REDEMPTIONS AND TRANSFERS.
It is hereby understood that Agent may apply a redemption fee for any
short-term redemption of shares purchased within specified time frames.
5. INDEMNIFICATION.
a. Agent shall indemnify and hold harmless the Fund Party and the Funds and
their respective directors, officers, employees, and agents from and against any
and all losses, claims, damages, liabilities and expenses (including, but not
limited to, reasonable attorney's fees) incurred by any of them and arising as a
result of: (i) Agent's dissemination of information regarding any Fund that is
incorrect and that was not provided to Agent, or approved in writing, by the
Fund Party, its affiliated persons (as defined in the Investment Company Act of
1940, as amended (the "1940 Act")) or agents; (ii) any breach by Agent of any
representation, warranty, covenant or agreement contained in this Agreement or
any law or regulation; or (iii) Agent's willful misconduct or gross negligence
in the performance of, or failure to perform, its obligations under this
Agreement, except to the extent the losses are a result of the gross negligence,
willful misconduct, or breach of this Agreement by the Fund Party.
b. The Fund Party hereby agrees to indemnify Agent and its directors,
officers, employees, and agents against any and all losses, claims, damages,
liabilities, and expenses (including, but not limited to, reasonable attorney's
fees) to which Agent may become subject as a result of any untrue or alleged
untrue statement of a material fact contained in the prospectuses, advertising,
or sales literature for the Funds, as amended or supplemented from time to time,
or the omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading; or any breach by Fund Party of any
representation, warranty, covenant or agreement contained in this Agreement or
any law or regulation; or Fund Party's willful misconduct or gross negligence in
the performance of, or failure to perform, its obligation's under this Agreement
except to the extent the losses are a result of gross negligence, willful
misconduct, or breach of this Agreement by the Agent.
c. In any event, no party shall be liable for any special, consequential or
incidental damages.
6. ROLE OF PARTIES.
The parties acknowledge and agree that the Services under this Agreement
are distribution, recordkeeping, shareholder communication, administrative and
related services only and are not the services of an underwriter or a principal
underwriter within the meaning of the Securities Act of 1933, as amended, or the
Investment Company Act of 1940. This Agreement does not grant Agent, or
participating correspondents any right to purchase shares
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from any Fund (although it does not preclude them from purchasing any such
shares), nor does it constitute Agent an agent of the Fund Party for purposes of
selling shares of any Fund to any dealer or to the public. To the extent Agent
is involved in the purchase of shares of any Fund by customers, such involvement
in these purchases will be as agent of such customers only.
7. INFORMATION TO BE PROVIDED.
The Fund Party shall provide to Agent, prior to the effectiveness of this
Agreement, or as soon thereafter as possible:
a. A copy of the current prospectus and statement of additional information
for each Fund participating in the program described herein. The Fund Party
shall provide Agent with written copies of any amendments to, or changes in such
documents as soon as possible after such amendments or changes become available.
8. NOTICES.
All notices required under this Agreement must be in writing and delivered
either personally or via first class mail. Such notices will be deemed to be
received as of the date of actual receipt, or three (3) days after deposit,
first class postage prepaid, in the United States Mail, whichever is earlier.
All such notices shall be made:
if to Agent, to: American United Life Insurance Company
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
if to the Fund Party, to: INVESCO Funds Group, Inc. and
INVESCO Distributors, Inc.
0000 Xxxx Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Senior Vice President
9. NONEXCLUSIVITY.
Each Party acknowledges that the other may enter into agreements, similar
to this one, with other parties, for the performance of services similar to
those to be provided under this Agreement, unless otherwise agreed to in writing
by the parties.
L0. ASSIGNABILITY.
This Agreement is not assignable by any party without the other party's
consent, except that Fund Party may assign this Agreement to a related INVESCO
entity, or wholly-owned subsidiary of AMVESCAP PLC, the Fund Party's parent
company. Any attempted assignment in contravention hereof shall be null and
void.
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11. SCHEDULES.
All Schedules attached to this Agreement (as they may be amended from time
to time) are, by this reference, incorporated into, and made a part of, this
Agreement.
12. ENTIRE AGREEMENT - AMENDMENT.
This Agreement (including the Schedules attached hereto), constitutes the
entire agreement between the parties with regard to the subject matter herein.
Additionally, these materials supersede any and all agreements, representations
and warranties, whether written or oral, made prior to the execution of this
Agreement. This Agreement and the Schedules attached hereto may be amended only
by a writing executed by each party to be bound by the amendment.
13. GOVERNING LAW.
This Agreement will be governed by, and interpreted under, the laws of the
State of Colorado as applied to contracts entered into and to be performed
entirely within that state, without reference to choice of law statutes.
14. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
will be deemed an original, but all of which together shall constitute one
instrument.
15. EFFECTIVENESS OF AGREEMENT TERMINATION.
a. This Agreement will become effective as to a Fund as of: (i) the date
set forth on Schedule I opposite the name of the Fund; or (ii) such later date
as Agent may, in its discretion, designate.
b. This Agreement may be terminated, as to one or more Funds (as reflected
in Schedule I, by either party upon thirty (30) days written notice to the
other parties; or upon such shorter notice as is required by law, order, or
instruction from a court of competent jurisdiction, regulatory body, or
self-regulatory organization with jurisdiction over the terminating party.
Notwithstanding the foregoing, this Agreement may be terminated immediately at
the option of Fund Party:
i. as to any Fund upon the termination of Fund Party's engagement as
the investment advisor, distributor, or transfer agent to such Fund, or
ii. upon the termination of any plan of distribution ("Rule 12b-1
Plan") adopted and maintained pursuant to Rule 12b-1 under the 1940 Act by
any Fund that has a Rule 12b-1 Plan in effect as of the effective date of
this Agreement.
c. Upon termination as to a Fund, Fund Party will not be obligated to pay
the fee with respect to any shares of the Fund. In addition, Section 5 shall
continue in full force and effect notwithstanding the termination of this
Agreement.
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16. REPRESENTATIONS AND WARRANTIES.
a. Agent represents and warrants that it is an insurance company duly
organized under the laws of Indiana and is duly registered and/or qualified as a
broker-dealer with the Securities and Exchange Commission (the "SEC"), the
National Association of Securities Dealers, Inc. and in every state or territory
of the United States where such registration or qualification is required, and
is duly registered or exempt from registration as a transfer agent with the SEC,
and has the requisite authority to enter into this Agreement and to carry out
the Services.
b. The execution and delivery of this Agreement and the performance of the
Services have been duly authorized by all necessary corporate action on the part
of Agent, and this Agreement constitutes the valid and binding obligation of
Agent.
17. INSURANCE.
Agent shall maintain, with financially sound and reputable insurers,
insurance against such liabilities, casualties and contingencies and in such
amounts as is customarily carried by prudent companies engaged in the same or a
similar business including, without limitation, an errors and omissions policy
providing coverage of at least One Million Dollars ($1,000,000). In the event
that Agent ceases to have such an errors and omissions policy in force, it shall
immediately notify Fund Party.
IN WITNESS WHEREOF, duly authorized representatives of the parties hereto
have executed this Agreement.
FUND PARTY: AGENT:
INVESCO FUNDS GROUP, INC. AMERICAN UNITED LIFE INSURANCE COMPANY
INVESCO DISTRIBUTORS, INC. One American Square
0000 Xxxx Xxxxx Xxxxxx Xxxxxxxxxxxx, XX 00000
Xxxxxx, Xxxxxxxx 00000
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
Print Name: Xxxxxx X. Xxxxxx Print Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President Title: Associate General Counsel
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SCHEDULE I
This Schedule dated as of May 16th, 2001 shall apply to the following Funds:
INVESCO Balanced Fund Investor Class
INVESCO Blue Chip Growth Fund Investor Class
INVESCO Dynamics Fund Investor Class
INVESCO Endeavor Fund Investor Class
INVESCO Energy Fund Investor Class
INVESCO Equity Income Fund Investor Class
INVESCO European Fund Investor Class
INVESCO Financial Services Fund Investor Class
INVESCO Gold Fund Investor Class
INVESCO Growth & Income Fund Investor Class
INVESCO Health Sciences Fund Investor Class
INVESCO High Yield Fund Investor Class
INVESCO International Blue Chip Value Fund Investor Class
INVESCO Leisure Fund Investor Class
INVESCO Real Estate Opportunity Fund Investor Class
INVESCO S&P 500 Index Fund Investor Class
INVESCO Select Income Fund Investor Class
INVESCO Tax-Free Long-Term Bond Fund Investor Class
INVESCO Technology Fund Investor Class
INVESCO Telecommunications Fund Investor Class
INVESCO Total Return Fund Investor Class
INVESCO U.S. Government Securities Fund Investor Class
INVESCO Utilities Fund Investor Class
INVESCO Value Equity Fund Investor Class
SCHEDULE II
Operational Procedures Relevant to the Agreement.
Unless processed using the NSCC Fund/SERV and/or Networking interfaces in the
customary manner as prescribed by the NSCC, or as amended by mutual agreement
whether verbally or in writing, operational responsibilities will be executed as
outlined below in paragraphs (1), (2), and (3)
1. THE ACCOUNTS.
Agent will open one or will utilize one already opened omnibus account per
Fund, providing for the cash payment of all capital gains and dividends. Agent
may open additional omnibus accounts in the future.
2. PURCHASE AND REDEMPTION ORDERS.
Agent will aggregate and calculate purchase and redemption orders for
shares of a Fund that it has accepted as placed by Customers prior to the close
of trading on the New York Stock Exchange, and will communicate to Fund Party
such orders for each Fund for each business day the New York Stock Exchange was
open. Such orders will receive the applicable Fund's closing net asset value for
that business day, provided they are communicated to Fund Party within agreed
upon time frames. For purposes of this Agreement, a "business day" is any day on
which a Fund's net asset value is determined.
3. SETTLEMENT OF TRADES.
Both Agent and the Fund Party-will use their best efforts to cause to be
transmitted by wire before 2 p.m. Eastern time on the business day following
Trade Date (settlement date) to an account as directed by the counterpart, the
proceeds of all redemption orders and the purchase price of all purchase orders.
However, if one or more Funds has determined to settle redemption transactions
for all of its shareholders on a delayed basis (more than one business day, but
in no event more than seven calendar days, after the date on which the
redemption order is received, unless otherwise permitted by an order of the
Securities and Exchange Commission under Section 22(e) of the Investment Company
Act of 1940), Fund Party shall be permitted to delay sending redemption proceeds
to Agent by wire transfer by the same number of days that the Fund is delaying
sending redemption proceeds to other shareholders of the Fund.
4. PRICE ERRORS.
If customers of Agent or its participating correspondents have received
amounts in excess of the amounts to which they otherwise would have been
entitled prior to an adjustment for a price error, Agent or its participating
correspondents, unless Fund Party and the Fund otherwise agree, will make a good
faith attempt to collect such excess amounts from their customers. In no event
however, shall Agent or a participating correspondent be liable to Fund or Fund
Party for any such amounts provided the overpayment was not caused by Agent or
the participating correspondent.
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5. ACCOUNT ACTIVITY AND DISTRIBUTION INFORMATION.
a. Fund Party shall cause to be provided to Agent confirmations of Fund
activity in the form of statements detailing activity no less frequently than
monthly, as well as other information as may reasonably be requested by Agent.
b. Fund Party shall cause to be provided to Agent all distribution
announcement information (ex dates, record dates, payable dates, distribution
rate per share, record date share balances, etc.) as soon as it is announced by
each Fund.
On the ex-dividend date, Fund Party or the Fund shall provide the reinvest
price (if determined on the ex-dividend date) and the total number of dollars
realized from the distribution credited to the Agent account. Prior to 10:00
a.m. (Eastern Time) on the next business day following the ex-dividend date,
acting as Fund Party's Agent, Agent shall notify Fund Party of the aggregate
number of Fund shares to be purchased in order to pay the distribution in shares
to the customers of Agent or its participating correspondents who have elected
to receive their capital gain distributions and/or dividends reinvested in
additional shares. Provided that Fund Party receives such notification prior to
10:00 a.m. (Eastern Time) on the next business day following the ex-dividend
date, Fund Party agrees that Agent may purchase such aggregate number of Fund
shares at the Fund prices computed on the ex-dividend date. Fund Party or such
Fund will wire the cash distribution proceeds of such transactions from the Fund
to appropriate Agent account(s) on the business day following the payable date.
c. All distribution data furnished to Agent under this section shall be
held by Agent in confidence, and Agent agrees to refrain from disclosing any
such information until such time as Fund Party or the Fund either consents to
such disclosure by Agent or makes such information publicly available. Agent
will maintain and enforce rules and policies designed to protect against
unauthorized access to, or use of, the information during such period by anyone
other than Agent employees who have a need to know the information for the
purposes described above.
6. TRANSFER OF ACCOUNTS.
a. Fund Party agrees to accept from Agent authorizations executed by
shareholders of the Funds to transfer existing client positions and accounts
into the Agent omnibus account. Agent agrees to clearly identify the appropriate
omnibus account for completion of the transfer and to adhere to the operating
requirements of Fund Party.
b. Agent agrees to transfer record ownership of a client's shares of the
Funds to the client promptly upon the request of the client. Fund Party agrees
to adhere to the operating requirements of Agent in connection with the
processing of any such transfers.
7. SHAREHOLDER COMMUNICATION.
a. The Fund Party shall provide the following shareholder communications
material to Agent, its participating correspondent or to their mailing Agents,
as directed by Agent, in quantities sufficient to allow mailing thereof to all
customers of Agent and its participating correspondents who are beneficial
owners of the Fund's shares.
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i. All proxy statements prepared for circulation to shareholders of
record of such Fund.
ii. Annual reports.
iii. Semi- annual reports.
iv. All updated prospectuses, supplements and amendments thereto.
b. The Fund Party or the Fund shall provide without charge the
above-mentioned materials to Agent, its participating correspondents or to their
mailing Agents. Agent will distribute, or will cause its participating
correspondents to distribute, all materials to their respective customers.
8. REGISTRATION REQUIREMENTS.
Agent and its participating correspondents will only place purchase orders
for shares of a Fund on behalf of customers whose addresses recorded on Agent's
or the participating correspondent's books are in states or other jurisdictions
in which such Fund is registered or qualified for sale or exempt from
registration and qualification under applicable law as confirmed in writing to
Agent by Fund Party. Fund Party shall advise Agent promptly if any such
registration or qualification is terminated or if Fund Party or the Fund wishes
to prevent Agent from placing or continuing to place purchase orders on behalf
of its customers who reside in a particular state or jurisdiction. Agent shall
provide Fund Party with such information as Fund Party may reasonably request
regarding sales and redemptions of Fund shares on a state-by-state basis.
9. USE OF INVESCO NAME.
Agent acknowledges and agrees that Fund Party and/or its affiliates own all
right, title and interest in and to the name INVESCO and the INVESCO open circle
design, and covenants not, at any time, to challenge the rights of Fund Party
and/or its affiliates to such name or design, or the validity or distinctiveness
thereof. Prior to its use of any advertising, sales literature or other
promotional materials that feature the Funds, Agent shall give Fund Party a
reasonable opportunity to review and comment upon such materials, and no such
materials shall be used if Fund Party objects. Subject to the foregoing
sentence, Fund Party hereby authorizes Agent to use the names and other
identifying marks of Fund Party or any Fund in connection with the operation of
Agent's mutual fund program. Fund Party may withdraw this authorization as to
any particular use of any such name or identifying marks at any time (i) upon
Fund Party's reasonable determination that such use would have a material
adverse effect on the reputation or marketing efforts of Fund Party or such Fund
or (ii) if no investment company, or series or class of shares of any investment
company advised by Fund Party continues to be available through Agent's mutual
fund program: provided, however, that Agent may, in its discretion, continue to
use materials prepared or printed prior to the withdrawal of such authorization.
MARKET TIMERS.
In the event that active traders or market timers become a problem for the
Funds in Agent's mutual fund program, the parties will negotiate in good faith
to develop a solution. Possible solutions include, but are not limited to,
limiting the size of purchase orders placed by such customers or prohibiting
such customers from investing in some or all of the Funds.
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11. CONFIDENTIALITY.
Each party acknowledges and understands that any and all technical, trade
secret or business information including, without limitation, financial
information, business or marketing strategies or plans, or product development
or customer information, which is disclosed to the other or is otherwise
obtained by the other during the term of the Agreement (the "Proprietary
Information") is confidential and proprietary, constitutes trade secrets of the
owner, and is of great value and importance to the success of the owner's
business. Each party agrees to use its best efforts (the same being not less
than those employed to protect its own proprietary information) to safeguard the
other's Proprietary Information and to prevent the unauthorized, negligent or
inadvertent use or disclosure thereof. Neither party shall, without the prior
written approval of an authorized officer of the other, directly or indirectly,
disclose the Proprietary Information to any person or entity except for its
employees, attorneys, accountants and other advisers on a need-to-know basis or
as may be required by law or regulation or demanded by any court or
administrative agency of competent jurisdiction. Each party shall promptly
notify the other in writing of any unauthorized, negligent or inadvertent use or
disclosure of the other's Proprietary Information. This section shall continue
in full force and effect notwithstanding the termination of this Agreement.
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SCHEDULE III
Schedule of services to be performed by Agent pursuant to this Agreement.
1. Agent represents and warrants that it has and will continue at all times
to have the necessary facilities, equipment and personnel to perform the
services hereunder in a businesslike and competent manner and its system
complies in all material respects with any applicable laws, rules and
regulations related to the services to be provided under this Agreement,
including the maintenance and preservation of all records and registrations
required by any applicable laws, rules and regulations.
2. Client-Shareholders will look to Agent and not the Fund for resolution
of problems or discrepancies in their accounts.
3. Agent agrees that it will perform various services for the
Client-Shareholders in those accounts, including where applicable:
* Establishing and maintaining records of Client-Shareholders' accounts;
* Processing purchase and redemption transactions;
* Confirming Client-Shareholder transactions and sending periodic
statements;
* Answering routine client inquires regarding the Funds;
* Assisting clients in changing dividend options, account designations and
addresses;
* Withholding taxes on non-resident alien accounts;
* Disbursing income, dividends and capital gains distributions;
* Reinvesting dividends and distributions;
* Preparing and delivering to Client-Shareholders and state and federal
authorities, including the United States Internal Revenue Service, such
information respecting dividends and distributions paid by the Funds as may be
required by law, rule or regulation;
* Withholding on dividends and distributions as may be required by state or
Federal authorities from time to time;
* Providing Fund prospectuses upon request and contemporaneously with
transaction confirmations to the extent required by law;
* And such other services as Fund Party may reasonably request.
4. Agent shall maintain all historical Client-Shareholder records,
consistent with requirements of all applicable laws, rules and regulations. (a)
Upon the request of the Fund Party,
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Agent shall provide copies of all the historical records relating to
transactions between the Funds and the Shareholders, written communications
regarding the Funds to or from the Shareholders and other materials, in each
case (1) as are maintained by Agent in the ordinary course of its business, and
(2) as may reasonably be requested to enable the Fund Party including without
limitation its auditors or legal counsel to (A) monitor and review the Services,
(B) comply with any request of a governmental or self regulatory organization,
(C) verify compliance by Agent with the terms of this agreement, (D) make
required regulatory reports, or (E) perform general customer supervision. Agent
agrees that it will permit the Fund Party to have reasonable access to its
personnel and records in order to facilitate the monitoring of the services.
Upon the request of Agent, Fund Party shall provide copies of all the historical
records relating to transactions between the Funds and Agent, written
communications regarding the Funds to or from Agent and other materials, in each
case (1) as are maintained by the Fund Party in the ordinary course of its
business and in compliance with applicable law, and (2) as may be requested to
enable Agent to (A) comply with the request of any governmental body or self
regulatory organization, (B) verify compliance by the Fund Party with the terms
of this Agreement, (C) make required regulatory reports, or (D) perform general
customer supervision.
5. Agent shall make available to Fund Party (if requested) records or
communications necessary to determine the number of Client-Shareholders in each
correspondent omnibus account, if applicable.
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SCHEDULE IV
For performance of Services as outlined in Schedule III (attached hereto), Agent
shall receive a service fee calculated as follows:
With respect to accounts in which the average shareholder account balance
exceeds $1,000 per Fund and the total omnibus investment amount per Agent
exceeds $1,000,000, Fund Party shall pay an annual service fee rate of 35 basis
points of the average daily market value of Program Shares, to be paid monthly
upon receipt of invoice by the Fund Party from Agent. However, for each month
that the Agent's average shareholder account balance falls below $1,000 per
Fund, the Agent shall be paid an annual service fee rate of 25 basis points of
the average daily market value of Fund shares, to be paid monthly upon receipt
of an invoice from Agent. No fee will be paid with respect to shareholder
accounts where the total omnibus investment is $1,000,000 or less per Agent. All
fees shall be invoiced by Agent in accordance with instructions as provided by
Fund Party and must be received by Fund Party in proper form within 30 days of
each month following the month for which the invoice is submitted. Agent shall
also include with the invoice a report showing the total number of active
individual customers or participants owning shares in each Fund through Agent's
omnibus account(s). No fees shall be payable with respect to Fund shares held by
Agent in Agent brokerage accounts for which an invoice is not timely provided in
proper form to Fund Party or for which an invoice has not been received.
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