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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
INVESCO Treasurer's Series Trust
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: ___________________________________________
2) Form, Schedule or Registration Statement No.: _____________________
3) Filing Party: _____________________________________________________
4) Date Filed: _______________________________________________________
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[INVESCO LOGO APPEARS HERE]
INVESCO TREASURER'S MONEY MARKET RESERVE FUND
INVESCO TREASURER'S TAX-EXEMPT RESERVE FUND
(each a series of INVESCO Treasurer's Series Trust)
March 23, 1999
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Dear Shareholder:
The attached proxy materials seek your approval to convert each of INVESCO
Treasurer's Money Market Reserve Fund ("Money Fund") and INVESCO Treasurer's
Tax-Exempt Reserve Fund ("Tax-Exempt Fund") (each a "Fund" or collectively,
the "Funds"), each a series of INVESCO Treasurer's Series Trust ("Treasurer's
Series Trust"), into portfolios of INVESCO Treasurer's Series Funds, Inc. to
make certain changes in the fundamental policies of those Funds, to approve
the proposed Investment Advisory Agreement with INVESCO Funds Group, Inc.
("INVESCO"), to elect trustees of Treasurer's Series Trust, and to ratify the
appointment of PricewaterhouseCoopers LLP as independent accountants of both
Funds.
Your board of trustees unanimously recommends a vote FOR all proposals. The
conversion of the Funds to portfolios of INVESCO Treasurer's Series Funds,
Inc., will streamline and render more efficient the administration of the
Funds. The changes to the fundamental policies of the Funds have been approved
by the board of trustees in order to simplify and modernize the Funds'
fundamental investment restrictions and make them more uniform with those of
the other INVESCO Funds. The attached proxy materials provide more information
about the proposed conversion, as well as the proposed changes in fundamental
policies, adviser, and the other matters you are being asked to vote upon.
Your vote is important no matter how many shares you own. Voting your shares
early will permit the Funds to avoid costly follow-up mail and telephone
solicitation. After reviewing the attached materials, please complete, date
and sign your proxy card and mail it in the enclosed return envelope promptly.
As an alternative to using the paper proxy card to vote, you may vote by
telephone, by facsimile, through the Internet, or in person.
Very truly yours,
/s/ Mark H. Williamson
Mark H. Williamson
President
INVESCO Treasurer's Series Trust
9968
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INVESCO TREASURER'S MONEY MARKET RESERVE FUND
INVESCO TREASURER'S TAX-EXEMPT RESERVE FUND
(each a series of INVESCO Treasurer's Series Trust)
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
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To The Shareholders:
NOTICE IS HEREBY GIVEN that a special meeting of the shareholders of the
INVESCO Treasurer's Money Market Reserve Fund ("Money Fund") and INVESCO
Treasurer's Tax-Exempt Reserve Fund ("Tax-Exempt Fund") (each a "Fund" or
collectively, the "Funds"), each a series of INVESCO Treasurer's Series Trust
("Treasurer's Series Trust"), will be held on May 20, 1999, at 10:00 a.m.,
Mountain Time, at the office of INVESCO Funds Group, Inc., 7800 East Union
Avenue, Denver, Colorado, for the following purposes:
1. To approve an Agreement and Plan of Conversion and Termination providing
for the conversion of Money Fund from a series of Treasurer's Series Trust
into a separate series of INVESCO Treasurer's Series Funds, Inc. and the
conversion of Tax-Exempt Fund from a series of Treasurer's Series Trust
into a separate series of INVESCO Treasurer's Series Funds, Inc.;
2. To approve certain changes to the fundamental investment restrictions of
each Fund;
3. To approve the proposed Investment Advisory Agreement with INVESCO Funds
Group, Inc.;
4. To elect trustees of Treasurer's Series Trust;
5. To ratify the selection of PricewaterhouseCoopers LLP as independent
accountants of each Fund; and
6. To transact such other business as may properly come before the meeting
or any adjournment thereof.
You are entitled to vote at the meeting and any adjournment thereof if you
owned shares of a Fund at the close of business on March 12, 1999. If you
attend the meeting, you may vote your shares in person. If you do not expect
to attend the meeting, please complete, date, sign and return the enclosed
proxy card in the enclosed postage-paid envelope.
By order of the Board of Directors,
/s/ Glen A. Payne
Glen A. Payne
Secretary
March 23, 1999
Denver, Colorado
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YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card,
date and sign the card, and return it in the envelope provided. IF YOU
DATE, SIGN, AND RETURN THE PROXY CARD BUT GIVE NO VOTING INSTRUCTIONS,
YOUR SHARES WILL BE VOTED "FOR" THE PROPOSALS DESCRIBED ABOVE. In order to
avoid the additional expense of further solicitation, we ask your
cooperation in mailing in your proxy card promptly. As an alternative to
using the paper proxy card to vote, you may vote by telephone, through the
Internet, by facsimile machine, or in person. To vote by telephone, please
call 1-800-690-6903. Shares that are registered in your name, as well as
shares that are held in "street name" through a broker, may be voted via
the Internet or by telephone. To vote in this manner, you will need the
12-digit "control" number that appears on your proxy card. To vote via the
Internet, please access http://www.proxyvote.com on the World Wide Web. In
addition, shares that are registered in your name may be voted by faxing
your completed proxy card to 1-800-733-1885. If we do not receive your
completed proxy card(s) after several weeks, you may be contacted by our
proxy solicitor, Shareholder Communications Corporation. Our proxy
solicitor will remind you to vote your shares or will record your vote
over the phone if you choose to vote in that manner.
Unless proxy cards submitted by corporations and partnerships are signed
by the appropriate persons as indicated in the voting instructions on the
proxy card, they will not be voted.
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INVESCO TREASURER'S MONEY MARKET RESERVE FUND
INVESCO TREASURER'S TAX-EXEMPT RESERVE FUND
(each a series of INVESCO Treasurer's Series Trust)
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7800 East Union Avenue
Denver, Colorado 80237
(Toll Free) 1-800-646-8372
PROXY STATEMENT
Special Meeting of Shareholders
May 20, 1999
VOTING INFORMATION
This Proxy Statement is being furnished to shareholders of INVESCO
Treasurer's Money Market Reserve Fund ("Money Fund") and INVESCO Treasurer's
Tax-Exempt Reserve Fund ("Tax-Exempt Fund") (each a "Fund" or collectively,
the "Funds"), each a series of INVESCO Treasurer's Series Trust ("Treasurer's
Series Trust"), in connection with the solicitation of proxies from
shareholders of the Funds by the Board of Trustees of the Treasurer's Series
Trust ("Board") for use at a special meeting of shareholders to be held on May
20, 1999 ("Meeting"), and at any adjournment of the Meeting. This Proxy
Statement is first being mailed to shareholders on or about March 23, 1999.
For each Fund, a majority of the Fund's shares outstanding on March 12, 1999
(the "Record Date"), represented in person or by proxy, shall constitute a
quorum and must be present for the transaction of business at the Meeting. If
a quorum is not present at the Meeting or a quorum is present but sufficient
votes to approve one or more of the proposals set forth in this Proxy
Statement are not received, the persons named as proxies may propose one or
more adjournments of the Meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the Meeting in person or by proxy. The persons named as
proxies will vote those proxies that they are entitled to vote FOR any
proposal in favor of such an adjournment and will vote those proxies required
to be voted AGAINST a proposal against such adjournment. A shareholder vote
may be taken on one or more of the proposals in this Proxy Statement prior to
any such adjournment if sufficient votes have been received with respect to
such proposal and it is otherwise appropriate.
Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners
or other persons entitled to vote and for which the broker does not have
discretionary voting authority. Abstentions and broker non-votes will be
counted as shares present for purposes of determining whether a quorum is
present but will not be voted for or against any adjournment or proposal.
Accordingly, abstentions and broker non-votes effectively will be a vote
against adjournment or against any proposal where the required vote is a
percentage of the shares present or outstanding. Abstentions and broker non-
votes will not be counted, however, as votes cast for purposes of determining
whether sufficient votes have been received to approve a proposal.
The individuals named as proxies on the enclosed proxy card will vote in
accordance with your directions as indicated on that proxy card, if it is
received properly executed by you or by your duly appointed agent or attorney-
in-fact. If you sign, date and return the proxy card, but give no voting
instructions, your shares will be voted in favor of
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approval of each of the proposals and the duly appointed proxies may, in their
discretion, vote upon such other matters as may come before the Meeting. The
proxy card may be revoked by giving another proxy or by letter or telegram
revoking the initial proxy. To be effective, revocation must be received by
the Treasurer's Series Trust prior to the Meeting and must indicate your name
and account number. If you attend the Meeting in person you may, if you wish,
vote by ballot at the Meeting, thereby canceling any proxy previously given.
In order to reduce costs, the notices to a shareholder having more than one
account in a Fund listed under the same Social Security number at a single
address have been combined. The proxy cards have been coded so that a
shareholder's votes will be counted for each such account.
As of the Record Date, Money Fund had 48,943,401.650 shares of common stock
outstanding and Tax-Exempt Fund had 36,236,120.740 shares of common stock
outstanding. The solicitation of proxies, the cost of which will be borne half
by INVESCO Funds Group, Inc. ("INVESCO") and half by the Funds, will be made
primarily by mail but also may be made by telephone or oral communications by
representatives of INVESCO and INVESCO Distributors, Inc. ("IDI"), the
distributor of the INVESCO group of investment companies ("INVESCO Funds"),
none of whom will receive any compensation for these activities from the
Funds, or by Shareholder Communications Corporation, professional proxy
solicitors, who will be paid fees and expenses of up to approximately
$4,678.00 for soliciting services. If votes are recorded by telephone,
Shareholder Communications Corporation will use procedures designed to
authenticate shareholders' identities, to allow shareholders to authorize the
voting of their shares in accordance with their instructions, and to confirm
that a shareholder's instructions have been properly recorded. You may also
vote by mail, by facsimile or through a secure Internet site. Proxies voted at
the Meeting by telephone, facsimile or Internet may be revoked at any time
before they are voted in the same manner that proxies voted by mail may be
revoked.
Copies of the most recent annual and semi-annual reports, including
financial statements, of Money Fund and Tax-Exempt Fund have previously been
delivered to their respective shareholders. Shareholders may request copies of
these reports, without charge, by writing to INVESCO Distributors, Inc., P.O.
Box 173706, Denver, Colorado 80217-3706, or by calling toll-free 1-800-646-
8372.
Except as set forth in Appendix A, INVESCO does not know of any person who
owns beneficially 5% or more of the shares of either Fund. Trustees and
officers of the Trust own in the aggregate less than 1% of the shares of each
Fund.
Vote Required. Approval of Proposal 1 with respect to either Fund requires
the affirmative vote of a majority of the outstanding voting securities of
that Fund. Approval of Proposals 2 or 3 with respect to each Fund requires the
affirmative vote of a "majority of the outstanding voting securities" of that
Fund, as defined in the Investment Company Act of 1940, as amended ("1940
Act"). This means that Proposals 2 or 3 must be approved by the lesser of (i)
67% of a Fund's shares present at a Meeting of shareholders if the owners of
more than 50% of that Fund's shares then outstanding are present in person or
by proxy or (ii) more than 50% of that Fund's outstanding shares. A plurality
of the votes cast at the Meeting is sufficient to approve Proposal 4. Approval
of Proposal 5 requires the affirmative vote of a majority of the votes present
at the Meeting, provided a quorum is present. Each outstanding full share of
each Fund is entitled to one vote, and each outstanding fractional share
thereof is entitled to a proportionate fractional share of one vote. If any
Proposal is not approved by the requisite vote of shareholders, the persons
named as proxies may propose one or more adjournments of the Meeting to permit
further solicitation of proxies.
2
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PROPOSAL 1: TO APPROVE AN AGREEMENT AND PLAN OF CONVERSION AND TERMINATION
("CONVERSION PLAN") PROVIDING FOR THE CONVERSION OF MONEY FUND FROM A
SEPARATE SERIES OF TREASURER'S SERIES TRUST TO A SEPARATE SERIES OF A
MARYLAND CORPORATION (INVESCO TREASURER'S SERIES FUNDS, INC.) AND PROVIDING
FOR THE CONVERSION OF TAX-EXEMPT FUND FROM A SEPARATE SERIES OF TREASURER'S
SERIES TRUST TO A SEPARATE SERIES OF INVESCO TREASURER'S SERIES FUNDS, INC.
Each Fund is presently organized as a series of Treasurer's Series Trust.
The Board, including a majority of its trustees who are not "interested
persons," as that term is defined in the 1940 Act, of either Treasurer's
Series Trust, INVESCO, or INVESCO Capital Management, Inc. ("ICM")
("Independent Trustees"), has unanimously approved the Conversion Plan in the
form attached to this Proxy Statement as Appendix B. The Conversion Plan
provides for the conversion of Money Fund from a separate series of
Treasurer's Series Trust, a Massachusetts business trust, to a newly
established separate series ("Money New Series") of INVESCO Treasurer's Series
Funds, Inc. ("Treasurer's Series Funds"), a Maryland corporation ("Money Fund
Conversion"). The Conversion Plan also provides for the conversion of Tax-
Exempt Fund from a separate series of Treasurer's Series Trust to a newly
established separate series ("Tax-Exempt New Series" and, together with Money
New Series, "New Series") of Treasurer's Series Funds ("Tax-Exempt Fund
Conversion" and, together with Money Fund Conversion, "Conversions").
Treasurer's Series Funds is referred to herein as the "Company." The proposed
Conversions will have no material effect on shareholders, officers, operations
or the management of either Fund.
Money New Series and Tax-Exempt New Series, neither of which has yet
commenced business operations and each of which was established for the
purpose of effecting the Conversions, will carry on the business of Money Fund
and Tax-Exempt Fund, respectively, following the Conversions and will have
investment objectives, policies and restrictions identical to those of Money
Fund and Tax-Exempt Fund, respectively. The investment objectives, policies
and restrictions of each Fund will not change except as approved by the
shareholders of each Fund as described in Proposal 2 of this Proxy Statement.
Except as described in Appendix C, the rights of the shareholders of each Fund
under state law and its governing documents are expected to remain unchanged
after the Conversions. Shareholder voting rights with respect to Treasurer's
Series Trust and the Company are currently based on the number of shares
owned. The same individuals serve as trustees of Treasurer's Series Trust and
directors of the Company.
ICM (or INVESCO if the shareholders of each Fund approve Proposal 3 herein),
the investment adviser to the Funds ("investment adviser"), will be
responsible for providing the New Series with various administrative services
and supervising the daily business affairs of the New Series, subject to the
supervision of the board of directors of the Company, under management
contracts substantially identical to the contracts in effect between ICM and
each Fund immediately prior to the consummation of the Conversions. The
distribution agent for the Funds, IDI, will distribute shares of each New
Series under General Distribution Agreements substantially identical to the
contracts in effect between IDI and each Fund immediately prior to the
consummation of the Conversions.
Reasons for the Proposed Conversions
The Board unanimously recommends conversion of each Fund to a separate
series of the Company (i.e., to the applicable New Series). These proposed
conversions are part of an overall plan that involves the conversion of other
INVESCO Funds as well. The goal of the conversions is to combine similar types
of funds into a single corporate entity. Ultimately, if all of the conversions
are approved, the INVESCO Funds will be organized into a group of core
companies, with one core company for each major fund type -- for example, all
INVESCO Funds that invest
3
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internationally will be series of one core company, all INVESCO Funds that
invest solely in debt securities will be series of one core company, and all
INVESCO Funds that invest in equity securities of domestic issuers will be
series of one core company. The Conversions are part of a general plan to
convert all of the INVESCO Funds into Maryland corporations, which should
facilitate administration of the Funds. Moving each Fund from Treasurer's
Series Trust to a series of the Company will also consolidate and streamline
the production and mailing of certain financial reports and legal documents.
The proposed Conversions will have no material effect on shareholders,
officers, operations or the management of either Fund.
The proposal to present the Conversion Plan to shareholders was approved by
the Board, including all of its Independent Trustees, on February 3, 1999. The
Board recommends that shareholders of Money Fund vote FOR approval of the
Conversion Plan and that shareholders of Tax-Exempt Fund vote FOR approval of
the Conversion Plan, each as described below. With respect to shareholders of
each Fund, such a vote encompasses approval of both: (i) the conversion of the
Fund to a separate series of Treasurer's Series Funds; and (ii) a temporary
waiver of certain investment limitations of each Fund to permit the
Conversions (see "Temporary Waiver of Investment Restrictions" below). If the
shareholders of Money Fund or Tax-Exempt Fund, as the case may be, do not
approve the Conversion, as set forth herein, that Fund will continue to
operate as a series of Treasurer's Series Trust.
Summary of the Conversion Plan
The following summary of the important terms of the Conversion Plan is
qualified in its entirety by reference to the Conversion Plan, which is
attached as Appendix B to this Proxy Statement.
If the Conversion is approved by shareholders of Money Fund, on May 30, 1999
or such later date to which Treasurer's Series Trust and the Company agree
(the "Closing Date"), Money Fund will transfer all of its assets to Money New
Series in exchange solely for shares of Money New Series ("Money New Series
Shares") equal to the number of Money Fund shares ("Money Shares") outstanding
on the Closing Date and the assumption by Money New Series of all of the
liabilities of Money Fund. Immediately thereafter, Money Fund will
constructively distribute to each Money Fund shareholder one Money New Series
Share for each Money Share held by the shareholder on the Closing Date, in
liquidation of the Money Shares. As soon as is practicable after this
distribution of Money New Series Shares, Money Fund will be terminated as a
series of Treasurer's Series Trust and will be wound up and liquidated. Upon
completion of the Conversion, each Money Fund shareholder will be the owner of
full and fractional Money New Series Shares equal in number, denomination, and
aggregate net asset value to his or her Money Shares.
If the Conversion is approved by shareholders of Tax-Exempt Fund, on the
Closing Date, Tax-Exempt Fund will transfer all of its assets to Tax-Exempt
New Series in exchange solely for shares of Tax-Exempt New Series ("Tax-Exempt
New Series Shares" and, together with Money New Series Shares, "New Series
Shares") equal to the number of Tax-Exempt Fund shares ("Tax-Exempt Shares"
and, together with Money Shares, "Fund Shares") outstanding on the Closing
Date and the assumption by Tax-Exempt New Series of all of the liabilities of
Tax-Exempt Fund. Immediately thereafter, Tax-Exempt Fund will constructively
distribute to each Tax-Exempt Fund shareholder one Tax-Exempt New Series Share
for each Tax-Exempt Share held by the shareholder on the Closing Date, in
liquidation of the Tax-Exempt Shares. As soon as is practicable after this
distribution of Tax-Exempt New Series Shares, Tax-Exempt Fund will be
terminated as a series of Treasurer's Series Trust and will be wound up and
liquidated. Upon completion of the Conversion, each Tax-Exempt Fund
shareholder will be the owner of full and fractional Tax-Exempt New Series
Shares equal in number, denomination, and aggregate net asset value to his or
her Tax-Exempt Shares.
4
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Each Conversion Plan obligates the Company to enter into a Management
Contract with the investment adviser for the applicable New Series ("New
Agreement"). Approval of the applicable Conversion Plan by shareholders of a
Fund will authorize Treasurer's Series Trust (which will be issued a single
share of each New Series on a temporary basis) to approve the New Agreement
with respect to that Fund as sole initial shareholder of the applicable New
Series. Each New Agreement will be substantially similar in its terms to the
corresponding contract or plan in effect with respect to a Fund immediately
prior to the Closing Date.
The New Agreement will take effect on the Closing Date and each will
continue in effect until May 15, 2000. Thereafter, the New Agreement will
continue in effect only if its continuance is approved at least annually: (i)
by the vote of a majority of the directors of the Company who are not
"interested persons," as that term is defined in the 1940 Act, of that
Company, ICIM or INVESCO ("Independent Directors"), cast in person at a
meeting called for the purpose of voting on such approval; and (ii) by the
vote of a majority of the directors of the Company or a majority of the
outstanding voting shares of the applicable New Series. The New Agreement will
be terminable without penalty on sixty days' written notice either by the
Company or the investment adviser, and will terminate automatically in the
event of its assignment.
The board of directors of the Company will hold office without limit in time
except that (i) any director may resign and (ii) a director may be removed at
any special meeting of the shareholders at which a quorum is present by the
affirmative vote of a majority of the outstanding voting shares of the
Company. In case a vacancy shall for any reason exist, a majority of the
remaining directors, though less than a quorum, will vote to fill such vacancy
by appointing another director, so long as, immediately after such
appointment, at least two-thirds of the directors have been elected by
shareholders. If, at any time, less than a majority of the directors holding
office have been elected by shareholders, the directors then in office will
promptly call a shareholders' meeting for the purpose of electing a board of
directors. Otherwise, there need normally be no meetings of shareholders for
the purpose of electing directors.
Assuming the Conversion Plan is approved, it is currently contemplated that
the Conversions will become effective on the Closing Date. However, either
Conversion may become effective on such other date as Treasurer's Series Trust
and the Company may agree in writing. Neither Conversion is conditioned on the
occurrence of the other Conversion.
The obligations of Treasurer's Series Trust and the Company under the
Conversion Plan are subject to various conditions as stated therein.
Notwithstanding the approval of a Conversion Plan by the Fund's shareholders,
that Conversion Plan may be terminated or amended at any time prior to the
Closing Date by action of the trustees of Treasurer's Series Trust or the
directors of the Company to provide against unforeseen events, if (i) there is
a material breach by the other party of any representation, warranty, or
agreement contained in the Conversion Plan to be performed at or prior to the
Closing Date or (ii) it reasonably appears that the other party will not or
cannot meet a condition of the Conversion Plan. Either Treasurer's Series
Trust or the Company may at any time waive compliance with any of the
covenants and conditions contained in, or may amend, the Conversion Plan,
provided that the waiver or amendment does not materially adversely affect the
interests of the applicable Fund's shareholders.
Continuation of Fund Shareholder Accounts
The Company's transfer agent and the Company will establish accounts for the
Money New Series shareholders and the Tax-Exempt New Series shareholders,
respectively, containing the appropriate number and denominations of Money New
Series Shares and Tax-Exempt New Series Shares to be received by each
shareholder under the Conversion Plan. Such accounts will be identical in all
material respects to the accounts currently maintained by the Funds' transfer
agent for the Funds' shareholders.
5
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Expenses
The Funds and the New Series will be responsible for one-half of the
expenses of their respective Conversions, estimated at approximately $5,600 in
the aggregate. INVESCO will be responsible for the other half of the expenses
of each Conversion.
Temporary Waiver of Investment Restrictions
Certain fundamental investment restrictions of each Fund, which prohibit
that Fund from acquiring more than a stated percentage of ownership of another
company, might be construed as restricting that Fund's ability to carry out
its Conversion. By approving the Conversion Plan, shareholders of Money Fund
or Tax-Exempt Fund, respectively, will be agreeing to waive, only for the
purpose of the Conversions, those fundamental investment restrictions that
could prohibit or otherwise impede the transaction.
Forms of Organization
Money Fund and Tax-Exempt Fund are two series of Treasurer's Series Trust,
an open-end, diversified investment management company. Treasurer's Series
Trust was organized on January 27, 1988 under the laws of the Commonwealth of
Massachusetts. Treasurer's Series Trust does not issue share certificates and
is not required to (nor does it) hold annual shareholder meetings.
Money New Series and Tax-Exempt New Series will each be one series of
Treasurers' Series Funds, an open-end, diversified investment management
company. Treasurer's Series Funds was incorporated on March 17, 1999 under the
laws of the State of Maryland. Treasurer's Series Funds has authorized capital
of 500,000,000 shares of common stock, par value $0.01 per share, of which
100,000,000 authorized and unissued shares of common stock have been allocated
to each New Series. Treasurer's Series Funds does not issue share certificates
and is not required to (nor does it) hold annual shareholder meetings.
Rights of Shareholders
As noted above, each New Series will be a series of an investment company
organized as a Maryland corporation, while each Fund is currently organized as
a series of a Massachusetts business trust. The rights of the shareholders of
each Fund, including rights with respect to shareholder meetings, inspection
of shareholder lists, and distributions on liquidation of that Fund, are
substantially similar to the rights of shareholders of a Maryland corporation,
such as the Company. Although shareholders of a Massachusetts business trust
may, under certain circumstances, be held personally liable for its
obligations, Treasurer's Series Trust's Declaration of Trust, as amended,
provides that generally, no trustee, shareholder, officer, employee or agent
of Treasurer's Series Trust will have personal liability for Treasurer's
Series Trust's obligations. In addition, Treasurer's Series Trust's
Declaration of Trust states that only the property of Treasurer's Series
Trust, and not the private property of any trustee, shareholder, officer,
employee or agent of Treasurer's Series Trust, shall be used to satisfy any
obligation of or claim against Treasurer's Series Trust. The Company's Board
of Directors will call meetings of shareholders as required by the 1940 Act,
Maryland law or the Company's Articles of Incorporation or By-laws and at
their discretion.
Comparison of Legal Structures
Comparisons of the material provisions of the Massachusetts statute
governing business trusts ("Massachusetts Statute") with the material
provisions of the Maryland statute governing corporations ("Maryland Statute")
and of
6
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the material provisions of Treasurer's Series Trust's Declaration of Trust and
By-laws with the material provisions of the Articles of Incorporation and By-
laws of the Company are included in Appendix C, which is entitled "Differences
in Legal Structures."
Tax Consequences of the Conversions
Treasurer's Series Trust and the Company will receive an opinion from their
counsel, Kirkpatrick & Lockhart LLP, that the Conversions will constitute tax-
free reorganizations within the meaning of Section 368(a)(1)(F) of the
Internal Revenue Code of 1986, as amended. Accordingly, no gain or loss will
be recognized for federal income tax purposes by Money Fund, Tax-Exempt Fund,
Money New Series, Tax-Exempt New Series or the shareholders of either Fund
upon: (i) the transfer of the assets of Money Fund or Tax-Exempt Fund in
exchange solely for Money New Series Shares or Tax-Exempt New Series Shares,
respectively, and the corresponding assumption by Treasurer's Series Funds on
behalf of Money New Series and Tax-Exempt New Series, respectively, of the
liabilities of Money Fund and Tax-Exempt Fund, respectively; or (ii) the
distribution of Money New Series Shares or Tax-Exempt New Series Shares, as
the case may be, to the shareholders of Money Fund or Tax-Exempt Fund in
liquidation of their Money Shares or Tax-Exempt Shares, respectively. The
opinion will further provide, among other things, that: (i) a Fund
shareholder's aggregate basis for federal income tax purposes in the Money New
Series Shares or the Tax-Exempt New Series Shares to be received by that
shareholder in conjunction with the applicable Conversion will be the same as
the aggregate basis of his or her Fund Shares to be constructively surrendered
in exchange for those New Series Shares; and (ii) a Fund shareholder's holding
period for his or her New Series Shares will include that shareholder's
holding period for his or her Fund Shares, provided that those Fund Shares
were held as capital assets at the time of the Conversion.
Conclusion
The Board has concluded that the proposed Conversion Plan is in the best
interests of the shareholders of the respective Funds. A vote in favor of the
Conversion Plan encompasses: (i) approval of the conversion of the Fund to the
applicable New Series; (ii) approval of the temporary waiver of certain
investment limitations of that Fund to permit the Conversion (see "Temporary
Waiver of Investment Restrictions," above); and (iii) authorization of
Treasurer's Series Trust, as sole initial shareholder of both New Series, to
approve the New Agreement with respect to each New Series between the Company
and its investment adviser. The New Agreement is substantially similar in its
terms to the contract in effect with the applicable Fund immediately prior to
the Closing Date. If approved, the Conversion Plan will take effect on the
Closing Date. If the Conversion Plan is not approved by the shareholders of a
Fund, the applicable Fund will continue to operate as a series of Treasurer's
Series Trust.
Required Vote
Approval of the Conversion Plan with respect to a Fund requires the
affirmative vote of a majority of the outstanding shares of that Fund.
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THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" PROPOSAL 1
PROPOSAL 2: TO APPROVE AMENDMENTS TO THE FUNDAMENTAL INVESTMENT
RESTRICTIONS OF EACH FUND.
As required by the 1940 Act, each Fund has adopted certain fundamental
investment restrictions ("fundamental restrictions"), which are set forth in
that Fund's Statement of Additional Information. These fundamental
restrictions may be changed only with shareholder approval. Restrictions and
policies that a Fund has not specifically designated as fundamental are
considered to be "non-fundamental" and may be changed by the Board without
shareholder approval.
Some of the Funds' fundamental restrictions reflect past regulatory,
business or industry conditions, practices or requirements that are no longer
in effect. Also, as other INVESCO Funds have been created over the years, they
have adopted substantially similar fundamental restrictions that often have
been phrased in slightly different ways, resulting in minor but unintended
differences in effect or potentially giving rise to unintended differences in
interpretation. Accordingly, the Board has approved revisions to the Funds'
fundamental restrictions in order to simplify and modernize the Funds'
fundamental restrictions and make them more uniform with those of the other
INVESCO Funds.
The Board believes that eliminating the disparities among the INVESCO Funds'
fundamental restrictions will enhance management's ability to manage the
funds' assets efficiently and effectively in changing regulatory and
investment environments and permit the Board to review and monitor investment
policies more easily. In addition, standardizing the fundamental restrictions
of the INVESCO Funds will assist the INVESCO Funds in making required
regulatory filings in a more efficient and cost-effective way. Although the
proposed changes in fundamental restrictions will allow each Fund greater
investment flexibility to respond to future investment opportunities, the
Board does not anticipate that the changes, individually or in the aggregate,
will result at this time in a material change in the level of investment risk
associated with an investment in that Fund.
The text and a summary description of each proposed change to each Fund's
fundamental restrictions are set forth below, together with the text of the
corresponding current fundamental restriction. The text below also describes
any non-fundamental restrictions that would be adopted by the Board in
conjunction with the revision of certain fundamental restrictions. Any non-
fundamental restriction may be modified or eliminated by the Board at any
future date without shareholder approval.
If approved by the shareholders of Money Fund or Tax-Exempt Fund at the
Meeting, the proposed changes in that Fund's fundamental restrictions will be
adopted by that Fund. The applicable Fund's Statement of Additional
Information will be revised to reflect those changes as soon as practicable
following the Meeting.
a. Modification of fundamental restriction on industry concentration
The Money Fund's current fundamental restriction on industry concentration
is as follows:
The Fund may not invest in the securities of issuers (excluding (i)
bankers' acceptances, time deposits and certificates of deposit of
domestic branches of U.S. banks and U.S. branches of foreign banks and
foreign branches of U.S. banks, provided that the U.S. branches are
subject to sufficient regulation by government bodies that they can be
considered U.S. banks, and the obligations of the foreign branches
qualify as
8
<PAGE>
unconditional obligations of the U.S. parent, and (ii) U.S. government
obligations) conducting their principal business activity in the same
industry, if immediately after such investment the value of [the] Fund's
investments in such industry would represent 25% or more of the value of
[the] Fund's assets.
The Tax-Exempt Fund's current fundamental restriction on industry
concentration is as follows:
The Fund may not invest in the securities of issuers (excluding (i)
municipal obligations, (ii) banker's acceptances, time deposits and
certificates of deposit of domestic branches of U.S. banks, and (iii)
U.S. government obligations) conducting their principal business
activity in the same industry, if immediately after such investment the
value of the Fund's investments in such industry would represent 25% or
more of the value of the Fund's total assets. It should be noted that
from time to time, the Fund may invest more than 25% of the value of its
total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues of the non-governmental users. The Fund may invest more than
25% of the value of its total assets in municipal obligations which are
related in such a way that an economic, business or political
development or change affecting one such security also would affect the
other securities; for example, securities the interest upon which is
paid from revenues of similar types of projects, or securities whose
issuers are located in the same state.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. Government or any of its
agencies or instrumentalities, municipal securities, or securities
issued or guaranteed by domestic banks, including U.S. branches of
foreign banks and foreign branches of U.S. banks) if, as a result, more
than 25% of the Fund's total assets would be invested in the securities
of companies whose principal business activities are in the same
industry.
The primary purpose of the modification is to eliminate minor differences in
the wording of the INVESCO Funds' current restrictions on concentration for
greater uniformity and to avoid unintended limitations, without materially
altering the restriction. The proposed changes to the Funds' fundamental
concentration policies clarify that the concentration limitation does not
apply to securities issued or guaranteed by the U.S. government, its agencies
or instrumentalities. The proposal would add the exclusion for municipal
securities for Money Fund, although Money Fund will not normally invest in
municipal securities. Tax-Exempt Fund would continue to be able to invest more
than 25% of its total assets in industrial development and private activity
bonds and in municipal obligations that are related in such a way that an
economic, business or political development or change affecting one such
security would also affect the other securities.
If the proposal is approved, the Board will adopt a non-fundamental policy
with respect to industry classifications for the Tax-Exempt Fund as follows:
With respect to fundamental limitation ( ), domestic and foreign banking
will be considered to be different industries.
b. Modification of fundamental restriction on issuer diversification
Each Fund's current fundamental restriction on issuer diversification is as
follows:
As to 100% of the assets of each Fund, invest in the securities of any
one issuer, other than U.S. government obligations, if immediately after
such investment more than 5% of the value of a Fund's total assets,
taken at market value, would be invested in such issuer.
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<PAGE>
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
Except to the extent permitted under Rule 2a-7 of the 1940 Act or any
successor rule thereto, the Fund may not purchase the securities of any issuer
(other than securities issued or guaranteed by the U.S. Government or any of
its agencies or instrumentalities, or securities of other investment
companies) if, as a result, (i) more than 5% of the Fund's total assets would
be invested in the securities of that issuer, or (ii) the Fund would hold more
than 10% of the outstanding voting securities of that issuer.
The primary purpose of the modification is to revise each Fund's fundamental
restriction on issuer diversification to conform to a restriction that is
expected to become standard for all INVESCO Funds that are money market funds.
The amended fundamental restriction also would permit each Fund to invest
without limit in the securities of other investment companies. Each Fund has
no current intention of doing so, and, as noted below, the 1940 Act imposes
restrictions on the extent to which a fund may invest in the securities of
other investment companies. The revision would, however, give each Fund
flexibility to invest in other investment companies in the event legal and
other regulatory requirements change.
If the proposal is approved, the Board will also adopt a non-fundamental
policy with respect to investments in municipal securities as follows:
Each state (including the District of Columbia and Puerto Rico),
territory and possession of the United States, each political
subdivision, agency, instrumentality and authority thereof, and each
multistate agency of which a state is a member is a "separate issuer.'
When the assets and revenues of an agency, authority, instrumentality or
other political subdivision are separate from the government creating
the subdivision and the security is backed only by assets and revenues
of the subdivision, such subdivision would be deemed to be the sole
issuer. Similarly, in the case of an Industrial Development Bond or
Private Activity Bond, if that bond is backed only by the assets and
revenues of the non-governmental user, then that non-governmental user
would be deemed to be the sole issuer.
c. Modification of fundamental restriction on underwriting securities
Each Fund's current fundamental restriction on underwriting securities is as
follows:
The Fund may not underwrite securities of other issuers, except insofar
as it may technically be deemed an "underwriter" under the Securities
Act of 1933, as amended, in connection with the disposition of a Fund's
portfolio securities.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not underwrite securities of other issuers, except insofar
as it may be deemed to be an underwriter under the Securities Act of
1933, as amended, in connection with the disposition of the Fund's
portfolio securities.
The purpose of the proposal is to eliminate minor differences in the wording
or punctuation of the INVESCO Funds' current restrictions on underwriting for
greater uniformity with the fundamental restrictions of the other INVESCO
Funds.
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<PAGE>
d. Elimination of fundamental restriction on investing in companies for the
purpose of exercising control or management
Each Fund's current fundamental restriction regarding investing in companies
for the purpose of exercising control or management is as follows:
The Fund may not invest in companies for the purpose of exercising
control or management.
The Board recommends that shareholders of each Fund vote to eliminate this
restriction. There is no legal requirement that a fund have an affirmative
policy on investment for the purpose of exercising control or management if it
does not intend to make investments for that purpose. The Funds have no
intention of investing in any company for the purpose of exercising control or
management. By eliminating this restriction, the Board may, however, be able to
authorize such a strategy in the future if it concludes that doing so would be
in the best interests of a Fund and its shareholders.
e. Modification of fundamental restriction on borrowing and adoption of non-
fundamental restriction on borrowing
Each Fund's current fundamental restriction on borrowing is as follows:
The Fund may not issue any class of senior securities or borrow money,
except borrowings from banks for temporary or emergency purposes not in
excess of 10% of the value of a Fund's net assets (not including the
amount borrowed) at the time the money is borrowed. The Funds are
permitted to borrow money only for the purpose of meeting redemption
requests which might otherwise require the untimely disposition of
securities. Borrowing is allowed as long as the cost of borrowing is
less than the income which would be lost should securities be sold to
meet the redemption requests. While in a borrowed position (including
reverse repurchase agreements), the Funds may not make purchases of
securities. The Funds may enter into reverse repurchase agreements only
for the purpose of obtaining funds necessary for meeting redemption
requests.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not borrow money, except that the Fund may borrow money in
an amount not exceeding 33 1/3% of its total assets (including the
amount borrowed) less liabilities (other than borrowings).
The primary purpose of the proposal is to eliminate differences between the
INVESCO Funds' current restrictions on borrowing and those imposed by the 1940
Act. Currently, the fundamental restrictions of the Funds are significantly
more limiting than the restrictions imposed by the 1940 Act in that they limit
the purposes for which the Funds may borrow to "temporary or emergency
purposes." The current fundamental restriction also limits the persons from
whom borrowings may be made to banks and provides that each Fund will not
purchase additional securities while any borrowings exist. The current
restriction also limits the circumstances in which each Fund may enter into
reverse repurchase agreements.
The proposed revision would eliminate the restrictions on the purposes for
which the Funds may borrow money. With respect to each Fund, the proposal would
also (i) eliminate the limitation on purchases of securities while borrowings
exist, (ii) eliminate the requirements that borrowings be from banks only,
(iii) increase the limitation on the amount that the Fund may borrow from 10%
of the value of the Fund's net assets to 33 1/3% of the value of the Fund's net
assets, (iv) provide flexibility to enter into reverse repurchase agreements to
meet future contingencies,
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<PAGE>
and (v) separate the restrictions on the issuance of senior securities from
each Fund's restriction on borrowings (see below). The Board believes that
this approach, making the Funds' fundamental restrictions on borrowing no more
limiting that is required under the 1940 Act, will maximize the Funds'
flexibility for future contingencies.
If the proposal is approved, the Board will adopt a non-fundamental
restriction as follows for each Fund:
The Fund may borrow money only from a bank or from an open-end
management investment company managed by INVESCO Funds Group, Inc. or an
affiliate or a successor thereof for temporary or emergency purposes
(not for leveraging or investing) or by engaging in reverse repurchase
agreements with any party (reverse repurchase agreements will be treated
as borrowings for purposes of fundamental limitation ( ) above).
The non-fundamental restriction reflects each Fund's current policy that
borrowing by the Fund may only be done for temporary or emergency purposes. In
addition to borrowing from banks, as permitted by each Fund's current policy,
the non-fundamental restriction permits each Fund to borrow from open-end
funds managed by INVESCO or an affiliate or successor thereof. A Fund would
not be able to do so, however, unless it obtains permission for such
borrowings from the Securities and Exchange Commission ("SEC"). The Board
believes that this approach, making each Fund's fundamental restriction on
borrowing no more limiting than is required under the 1940 Act, while
incorporating more strict limits on borrowing in each Fund's non-fundamental
restriction, will maximize each Fund's flexibility for future contingencies.
f. Modification of fundamental restriction on the issuance of senior
securities
Currently, each Fund's fundamental restriction on the issuance of senior
securities is combined with its restriction on borrowing (see above). To
conform each Fund's restriction on the issuance of senior securities (i.e.,
obligations that have a priority over the Fund's shares with respect to the
distribution of Fund assets or the payment of dividends) with those of the
other INVESCO Funds, the Board recommends that shareholders vote to adopt the
following separate fundamental restriction for each Fund:
The Fund may not issue senior securities, except as permitted under the
Investment Company Act of 1940.
The Board believes that the adoption of the proposed fundamental
restriction, which does not specify the manner in which senior securities may
be issued and is no more limiting than is required under the 1940 Act, would
maximize each Fund's borrowing flexibility for future contingencies and would
conform to the fundamental restrictions of the other INVESCO Funds on the
issuance of senior securities.
g. Elimination of fundamental restriction on mortgaging, pledging or
hypothecating securities
Each Fund currently has the following fundamental restriction on mortgaging,
pledging or hypothecating securities:
The Fund may not mortgage, pledge, hypothecate or in any manner transfer
as security for indebtedness any securities owned or held except to
secure funds borrowed and then only to an extent not greater than 10% of
the value of the Fund's total assets.
This restriction is derived from a state "blue sky" requirement which has
been preempted by recent amendments of the Federal securities laws.
Accordingly, the Board recommends that shareholders of each Fund vote to
eliminate this restriction.
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<PAGE>
h. Elimination of fundamental restriction on short sales and margin purchases
and adoption of non-fundamental restriction on short sales and margin
purchases
Each Fund currently has a fundamental restriction on short sales stating
that:
The Fund may not make short sales of securities or maintain a short
position.
In addition, each Fund has a fundamental restriction on margin transactions
that states:
The Fund may not purchase securities on margin, except that a Fund may
obtain such short-term credit as may be necessary for the clearance of
purchases and sales of portfolio securities.
The Board recommends that shareholders of each Fund vote to eliminate these
fundamental restrictions. If the proposal is approved, the Board will adopt
the following non-fundamental restriction for each Fund:
The Fund may not sell securities short (unless it owns or has the right
to obtain securities equivalent in kind and amount to the securities
sold short) or purchase securities on margin, except that (i) this
policy does not prevent the Fund from entering into short positions in
foreign currency, futures contracts, options, forward contracts, swaps,
caps, floors, collars and other financial instruments, (ii) the Fund may
obtain such short-term credits as are necessary for the clearance of
transactions, and (iii) the Fund may make margin payments in connection
with futures contracts, options, forward contracts, swaps, caps, floors,
collars and other financial instruments.
The proposed changes clarify the wording of the restriction and expand the
exceptions to the restriction, which generally prohibits a Fund from selling
securities short or buying securities on margin. Margin purchases involve the
purchase of securities with money borrowed from a broker. "Margin" is the cash
or eligible securities that the borrower places with a broker as collateral
against the loan. In a short sale, an investor sells a borrowed security and
has a corresponding obligation to the lender to return the identical security.
The proposed non-fundamental restriction permits short sales against the box,
when an investor sells securities short while owning the same securities in
the same amount or having the right to obtain equivalent securities. It also
permits a Fund to borrow a security on a short-term basis and to enter into
short positions and make margin payments in a variety of financial
instruments. The Board believes that elimination of the fundamental
restriction and adoption of the non-fundamental restriction will provide the
Funds with greater investment flexibility.
i. Modification of fundamental restriction on real estate investments
Each Fund's current fundamental restriction on investing in real estate is
as follows:
The Fund may not purchase or sell real estate or interests in real
estate.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not purchase or sell real estate unless acquired as a
result of ownership of securities or other instruments (but this shall
not prevent the Fund from investing in securities or other instruments
backed by real estate or securities of companies engaged in the real
estate business).
In addition to conforming each Fund's fundamental restriction on real
estate, the proposal would more completely describe the types of real estate-
related securities investments that are permissible for each Fund and
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<PAGE>
would permit each Fund to purchase or sell real estate acquired as a result of
ownership of securities or other instruments (e.g., through foreclosure on a
mortgage in which each Fund directly or indirectly holds an interest). The
Board believes that this clarification will make it easier for decisions to be
made concerning each Fund's investments in real estate-related securities
without materially altering the general restriction on direct investments in
real estate or interests in real estate. The proposed change would also give
each Fund the ability to invest in assets secured by real estate.
j. Modification of fundamental restriction on investing in commodities
Each Fund's current fundamental restriction on investing in commodities is
as follows:
The Fund may not purchase or sell commodities or commodity contracts.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not purchase or sell physical commodities; however, this
policy shall not prevent the Fund from purchasing and selling foreign
currency, futures contracts, options, forward contracts, swaps, caps,
floors, collars and other financial instruments.
The proposed changes to this investment restriction are intended to conform
the restriction to those of the other INVESCO Funds and to ensure that each
Fund will have the maximum flexibility to enter into hedging or other
transactions utilizing financial contracts and derivative products when doing
so is permitted by operating policies established for each Fund by the Board.
Due to the rapid and continuing development of derivative products and the
possibility of changes in the definition of "commodities," particularly in the
context of the jurisdiction of the Commodities Futures Trading Commission, it
is important for each Fund's policy to be flexible enough to allow it to enter
into hedging and other transactions using these products when doing so is
deemed appropriate by INVESCO and is within the investment parameters
established by the Board. To maximize that flexibility, the Board recommends
that each Fund's fundamental restriction on commodities investments be clear
in permitting the use of derivative products, even if the current non-
fundamental investment policies of each Fund would not permit investment in
one or more of the permitted transactions.
k. Modification of fundamental restriction on loans
Each Fund's current fundamental restriction on loans is as follows:
The Fund may not make loans to other persons, provided that a Fund may
purchase debt obligations consistent with its investment objectives and
policies, may lend limited amounts (not to exceed 20% of its total
assets) of its portfolio securities to broker-dealers or other
institutional investors, and may enter into repurchase agreements.
The Board recommends that shareholders of each Fund vote to replace this
restriction with the following fundamental restriction:
The Fund may not lend any security or make any loan if, as a result,
more than 33 1/3% of its total assets would be lent to other parties,
but this limitation does not apply to the purchase of debt securities or
to repurchase agreements.
The primary purpose of the proposal is to expand each Fund's lending
limitation from 20% to 33 1/3% of its assets and conform each Fund's
fundamental restriction on loans to those of the other INVESCO Funds for
greater
14
<PAGE>
uniformity. Each Fund's current investment restriction is considerably more
limiting than provisions in the 1940 Act governing lending. The proposed
changes to this investment restriction would maximize each Fund's lending
flexibility for future contingencies.
l. Modification of fundamental restriction on investing in another investment
company and adoption of non-fundamental investment restriction regarding
investment in securities issued by other investment companies
Each Fund's current fundamental restriction regarding investments in other
investment companies is as follows:
The Fund may not purchase securities of other investment companies
except (i) in connection with a merger, consolidation, acquisition or
reorganization, or (ii) by purchase in the open market of securities of
other investment companies involving only customary brokers' commissions
and only if immediately thereafter (i) no more than 3% of the voting
securities of any one investment company are owned by a Fund, (ii) no
more than 5% of the value of the total assets of a Fund would be
invested in any one investment company, and (iii) no more than 10% of
the value of the total assets of a Fund would be invested in the
securities of such investment companies.
The Board recommends that shareholders of each Fund vote to replace this
fundamental restriction with the following fundamental restriction:
The Fund may, notwithstanding any other fundamental investment policy or
limitation, invest all of its assets in the securities of a single open-
end management investment company managed by INVESCO Funds Group, Inc.
or an affiliate or a successor thereof, with substantially the same
fundamental investment objective, policies and limitations as the Fund.
The proposed revision to each Fund's current fundamental restriction would
ensure that the INVESCO Funds have uniform policies permitting each Fund to
adopt a "master/feeder" structure whereby one or more Funds invest all of
their assets in another Fund. The master/feeder structure has the potential,
under certain circumstances, to minimize administrative costs and maximize the
possibility of gaining a broader investor base. Currently, none of the INVESCO
Funds intends to establish a master/feeder structure; however, the Board
recommends that each Fund's shareholders adopt a restriction that would permit
this structure in the event that the Board determines to recommend the
adoption of a master/feeder structure by the Fund. The proposed revision would
require that any fund in which the Fund may invest under a master/feeder
structure be advised by INVESCO or an affiliate thereof.
If the proposed revision is approved, the Board will adopt a non-fundamental
restriction as follows for each Fund:
The Fund may invest in securities issued by other investment companies
to the extent that such investments are consistent with the Fund's
investment objective and policies and permissible under the 1940 Act.
The primary purpose of this non-fundamental restriction is to conform to the
other INVESCO Funds and to the 1940 Act requirements for investing in other
investment companies. Adoption of this non-fundamental restriction will enable
each Fund to purchase the securities of other investment companies to the
extent permitted under the 1940 Act or pursuant to an exemption granted by the
SEC. If a Fund did purchase the securities of another investment company,
shareholders might incur additional expenses because the Fund would have to
pay its ratable share of the expenses of the other investment company.
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<PAGE>
m. Elimination of fundamental restriction on illiquid securities and adoption
of non-fundamental policy on illiquid securities
Each Fund's current fundamental restriction is as follows:
The Fund may not enter into repurchase agreements if more than 10% of
the Fund's net assets will be invested in repurchase agreements and in
participation interests without demand features, time deposits having a
stated maturity greater than seven days, securities having legal or
contractual restrictions on resale, securities for which there is no
readily available market, or in other illiquid securities.
The Board recommends that shareholders of each Fund vote to eliminate this
fundamental restriction that prohibits each Fund from having more than 10% of
its total assets invested in illiquid securities. If the proposal is approved,
the Board will adopt the following non-fundamental policy for each Fund:
The Fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the
prices at which they are valued.
The primary purpose of the proposal is to conform to the federal securities
law requirements regarding investment in illiquid securities and to conform
the investment restrictions of the Fund to those of the other INVESCO Funds.
Currently, each Fund's fundamental restriction prohibits investment in
restricted securities. The proposed non-fundamental policy would clarify that
the Funds may invest in illiquid securities and would continue to restrict
investment in such securities to 10% of each Fund's net assets. The Board
believes that the proposed elimination of the fundamental restriction and
subsequent adoption of the non-fundamental restriction will make the policy
more accurately reflect market conditions and will maximize each Fund's
flexibility for future contingencies. The Board may delegate to the Funds'
investment advisor the authority to determine whether a security is liquid for
the purposes of this investment limitation.
n. To make non-fundamental the policy with respect to tax-free obligations
(Tax-Exempt Fund only)
It is currently a fundamental policy of Tax-Exempt Fund that the Fund, under
normal market conditions, will invest at least 80% of its net assets in
municipal obligations that, based on the opinion of counsel to the issuer of
the obligation, pay interest free from Federal income tax. The Board is asking
shareholders to eliminate this policy as a fundamental policy, and to replace
it with an identical non-fundamental policy. The Fund's policy with respect to
investment in obligations free from Federal income tax is not required to be
fundamental. If the policy is made non-fundamental, the Board would be able to
change the policy in future if necessary to adopt to changing conditions
without incurring the expense of a shareholder vote to approve such change.
Vote Required. Approval of Proposal 2 with respect to Money Fund or Tax-
Exempt Fund requires the affirmative vote of a "majority of the outstanding
voting securities" of each Fund, which for this purpose means the affirmative
vote of the lesser of (i) 67% or more of the shares of that Fund present at
the Meeting or represented by proxy if more than 50% of the outstanding shares
of that Fund are so present or represented, or (ii) more than 50% of the
outstanding shares of that Fund. Shareholders who vote "for" Proposal 2 will
vote "for" each proposed change described above. Those shareholders who wish
to vote against any of the specific proposed changes described above may do so
on the proxy provided. With respect to Money Fund or Tax-Exempt Fund, if
Proposal 1 in this Proxy Statement is approved, the changes approved under
Proposal 2 for that Fund will apply to the applicable New Series.
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<PAGE>
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" PROPOSAL 2.
PROPOSAL 3: TO APPROVE THE PROPOSED INVESTMENT ADVISORY AGREEMENT WITH
INVESCO FUNDS GROUP, INC.
Management of the Treasurer's Series Trust believes that Treasurer's Series
Trust, the Money Fund and the Tax-Exempt Fund, and their respective
shareholders would all benefit from certain changes to the service provider
arrangements of each Fund described in Proposal 3 of this Proxy Statement.
Proposal 3 seeks the approval of the shareholders of the Money Fund and the
Tax-Exempt Fund to replace the Funds' current investment advisor, ICM, with
INVESCO.
In order to change investment adviser, a new investment advisory agreement
(the "New Management Contract") must be approved by a vote of the shareholders
of each Fund. The shareholders of each Fund will be asked at the Meeting to
approve or disapprove the New Management Contract between INVESCO and the Fund
with respect to their Fund. The New Management Contract was approved for each
Fund by the Board, including a majority of the trustees who are not parties to
the New Management Contract or interested persons of such parties
("independent trustees"), at a meeting held on February 3, 1999. A form of the
New Management Contract is attached as Appendix D. Under the New Management
Contract, INVESCO will have the same duties and responsibilities and will
receive the same compensation as ICM does under the current management
contract.
Information concerning INVESCO
INVESCO, which has its principal office at 7800 East Union Avenue, Denver,
Colorado 80237, was organized in 1932 as a Delaware corporation. It is an
investment adviser registered as such with the Securities and Exchange
Commission under the Investment Advisers Act of 1940. INVESCO is an indirect
wholly owned subsidiary of AMVESCAP PLC, a publicly traded holding company
that, through its subsidiaries, engages in the business of investment
management on an international basis. The corporate headquarters of AMVESCAP
PLC are located at 11 Devonshire Square, London, EC2M 4YR England. The
directors and principal executive officers of INVESCO are as follows:
Mark H. Williamson, Chairman of the Board, President, Chief Executive
Officer and Director; Charles B. Mayer, Director and Senior Vice President;
Ronald L. Grooms, Director, Senior Vice President and Treasurer; Richard W.
Healey, Director and Senior Vice President; Timothy J. Miller, Director and
Senior Vice President and Glen A. Payne, Senior Vice President, Secretary and
General Counsel.
The address of each of the foregoing officers and directors is 7800 East
Union Avenue, Denver, Colorado 80237.
The following individuals serve as officers of the INVESCO Funds:
Mark H. Williamson, *+ President and Chief Executive Officer and Director of
INVESCO Distributors, Inc.; President, Chief Executive Officer and Director of
INVESCO Funds Group, Inc.; President, Chief Operating Officer and Trustee of
INVESCO Global Health Sciences Fund; formerly Chairman and Chief Executive
Officer of NationsBanc Advisors, Inc. Age 47.
Glen A. Payne, Secretary. Senior Vice President, General Counsel and
Secretary of INVESCO Funds Group, Inc.; Senior Vice President, Secretary and
General Counsel of INVESCO Distributors, Inc.; Secretary of
17
<PAGE>
INVESCO Global Health Sciences Fund; formerly, General Counsel of INVESCO
Trust Company (1989 to 1998) and employee of a U.S. regulatory agency,
Washington, D.C. (1973 to 1989). Age 50.
Ronald L. Grooms, Treasurer. Director , Senior Vice President and Treasurer
of INVESCO Funds Group, Inc.; Director, Senior Vice President and Treasurer of
INVESCO Distributors, Inc.; Treasurer and Principal Financial and Accounting
Officer of INVESCO Global Health Sciences Fund; formerly, Senior Vice
President and Treasurer of INVESCO Trust Company (1988 to 1998). Age 51.
William J. Galvin, Jr., Assistant Secretary. Senior Vice President of
INVESCO Funds Group, Inc.; Senior Vice President of INVESCO Distributors,
Inc.; formerly, Trust Officer of INVESCO Trust Company (1995 to 1998);
formerly Vice President of INVESCO Funds Group, Inc. and Vice President of 440
Financial Group; Assistant Vice President of Putnam Companies. Age 41.
Alan I. Watson, Assistant Secretary. Vice President of INVESCO Funds Group,
Inc.; formerly, Trust Officer of INVESCO Trust Company. Age 56.
Judy P. Wiese, Assistant Treasurer. Vice President of INVESCO Funds Group,
Inc.; formerly, Trust Officer of INVESCO Trust Company. Age 49.
INVESCO currently serves as investment adviser to the following INVESCO
Funds: INVESCO Bond Funds, Inc. (formerly INVESCO Income Funds, Inc.), INVESCO
Combination Stock & Bond Funds, Inc. (formerly, INVESCO Flexible Funds, Inc.
and INVESCO Multiple Asset Funds, Inc.), INVESCO Diversified Funds, Inc.,
INVESCO Emerging Opportunity Funds, Inc., INVESCO Growth Funds, Inc.
(formerly, INVESCO Growth Fund, Inc.), INVESCO Industrial Income Fund, Inc.,
INVESCO International Funds, Inc., INVESCO Money Market Funds, Inc., INVESCO
Sector Funds, Inc. (formerly, INVESCO Strategic Portfolios, Inc.), INVESCO
Stock Funds, Inc. (formerly, INVESCO Equity Funds, Inc. and INVESCO Capital
Appreciation Funds, Inc.), INVESCO Tax-Free Income Funds, Inc., and INVESCO
Variable Investment Funds, Inc.
INVESCO serves as investment adviser to the following investment companies
that have a similar investment objective to each of the Funds:
<TABLE>
<CAPTION>
Net
Name of Company or Series Assets(1) Rate of Compensation
- ------------------------- ----------- -------------------------
<S> <C> <C>
INVESCO Cash Reserves Fund 770,050,906 First $300 million--0.50%
Next $200 million--0.40%
Over $500 million--0.30%
INVESCO Tax-Free Money
Fund 50,305,205 First $300 million--0.50%
Next $200 million--0.40%
Over $500 million--0.30%
INVESCO U.S. Government Money 102,674,272 First $300 million--0.50%
Fund Next $ 200 million--0.40%
Over $ 500 million--0.30%
</TABLE>
- --------
(1) At November 30, 1998 (unaudited).
18
<PAGE>
To keep expenses competitive, INVESCO voluntarily reimburses the Tax-Free
Money Fund for certain expenses in excess of 0.75% of average net assets, the
U.S. Government Money Fund for certain expenses in excess of 0.85% of average
net assets and the Cash Reserves Fund for certain expenses in excess of 0.90%
of average net assets. All voluntary expense caps exclude excess amounts that
have been offset by expense offset arrangements with the funds' custodian.
Any company or series for which INVESCO has agreed to a voluntary expense
limitation is noted.
Terms of the Investment Advisory Agreements
ICM, which has its principal offices at 1315 Peachtree Street, Atlanta,
Georgia 30309, currently serves as the investment adviser ("investment
adviser") to the Treasurer's Series Trust and to each of its series, the Money
Fund and Tax-Exempt Fund, pursuant to the existing management contract
("Current Advisory Agreement") between ICM and Treasurer's Series Trust. The
Current Advisory Agreement was approved by the Board on November 6, 1996, and
by shareholders of each Fund on January 31, 1997.
The Current Advisory Agreement continues in effect from year to year
provided such continuance is specifically approved at least annually (i) by
the vote of a majority of each Fund's outstanding voting securities (as
defined in the first paragraph under "Investment Restrictions" in the
Prospectus) or by the Trustees of Treasurer's Series Trust, and (ii) by the
vote of a majority of the Trustees of Treasurer's Series Trust who are not
"interested persons" (as such term is defined by the 1940 Act) of Treasurer's
Series Trust or ICM. The Current Advisory Agreement is terminable on 60 days'
written notice by either party.
The operative terms of the New Management Contract are substantially similar
to those of the Current Advisory Agreement. The terms of each of the
Agreements are as follows (the New Management Contract and the Current
Advisory Agreement are referred to collectively as "Agreements" and INVESCO
and ICM are referred to as "investment adviser"):
The Agreements provide that the investment adviser shall (either directly or
by delegation to a sub-adviser) maintain a continuous investment program for
Treasurer's Series Trust and each of the Funds that is consistent with
Treasurer's Series Trust and the Funds' respective investment objectives and
policies as set forth in Treasurer's Series Trust's registration statement and
the prospectuses and statements of additional information of each of the Funds
as in effect from time to time under the 1940 Act and the Securities Act of
1933, as amended. In the performance of such duties, the investment adviser
shall, among other things: (i) manage the investment and reinvestment of the
assets of Treasurer's Series Trust and the Funds; (ii) determine what
securities are to be purchased or sold for Treasurer's Series Trust and the
Funds and execute transactions accordingly; (iii) furnish Treasurer's Series
Trust and the Funds with investment analysis and research, reviews of current
economic conditions and trends and considerations respecting long-range
investment policies; (iv) make recommendations as to the manner in which
rights pertaining to the Funds' securities should be exercised; (v) furnish
requisite personnel necessary in connection with the Funds' operations; (vi)
furnish office space, facilities, equipment and supplies; (vii) conduct
periodic reviews of the Funds' compliance operations; (viii) prepare and
review certain required documents, reports and filings (including filings to
the SEC), except insofar as the assistance of independent accountants or
attorneys is necessary or desirable; (ix) supply basic telephone service and
other utilities; and (x) prepare and maintain the books and records required
under Rule 31a-1(b)(4), (5), (9) and (10) under the 1940 Act. The investment
adviser, pursuant to the Agreement, pays all of the costs and expenses
associated with the Funds' operations and activities, except those expressly
assumed under the Agreement by the Funds. Expenses paid by the Funds include,
among others: (a) brokers' commissions, issue and transfer taxes and other
costs in connection with securities transactions in which
19
<PAGE>
Treasurer's Series Trust is a party; (b) any interest on indebtedness incurred
by Treasurer's Series Trust; and (c) extraordinary expenses (such as
unexpected franchise taxes and corporate fees). The New Management Contract is
different since in the future the Funds may be charged transfer agent,
administrative services, and other fees if the Board of Directors of
Treasurer's Series Funds, Inc. approves such fees and related agreements.
As full compensation for its advisory and other services to Treasurer's
Series Trust, the investment adviser receives a monthly fee. The fee is based
upon a percentage of each Fund's average net assets, determined daily. On an
annual basis the advisory fee paid by each Fund is equal to 0.25% of the
Fund's average net asset value.
For the fiscal year ended December 31, 1998, Treasurer's Series Trust paid
the investment adviser fees of $220,903 of which $144,183 was allocated to the
Money Fund and $79,720 was allocated to the Tax-Exempt Fund, representing
0.25% of each Fund's average net assets.
Evaluation by the Board of Trustees
At a meeting held on February 3, 1999, the Board reviewed information
presented to them regarding INVESCO and its qualifications to act as
investment adviser to Treasurer's Series Trust. They reviewed information
presented by management regarding anticipated benefits to Treasurer's Series
Trust and its shareholders from a new advisory relationship with INVESCO.
INVESCO advised the Board that, in addition to serving the Funds' current
institutional investors, INVESCO would also manage the Funds to attract
certain retail investors. With respect to the New Management Contract, the
Board noted the considerable experience and qualifications of INVESCO, in
particular with respect to the management of retail funds. The terms of the
New Management Contract would be substantially similar to those of the Current
Advisory Agreement with ICM except that, subject to Board approval, the new
Management Agreement authorizes Treasurer's Series Funds to enter into
separate agreements for administrative and transfer agency services. There
will be no change in advisory fees paid by the Funds, although the Funds'
expenses in the future could increase if the Funds' Board of Directors
approves separate transfer agency and administrative fees under separate
agreements.
Based upon the board's review and evaluation of this information, and in
consideration of all factors deemed relevant to it, and after consultation
with independent counsel by the Independent Trustees, the Board determined
that the New Management Contract is fair and reasonable and in the best
interests of Treasurer's Series Trust, Money Fund and Tax-Exempt Fund and
their shareholders. Accordingly, the Board, including all of the Independent
Trustees, approved the New Management Contract and voted to recommend that the
shareholders of each Fund vote to approve the New Management Contract.
Vote Required. Approval of Proposal 3 with respect to each Fund requires the
affirmative vote of a "majority of the outstanding voting securities" of that
Fund, which for this purpose means the affirmative vote of the lesser of (i)
67% or more of the shares of that Fund present at the Meeting or represented
by proxy if more than 50% of the outstanding shares of that Fund are so
present or represented, or (ii) more than 50% of the outstanding shares of
that Fund.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" PROPOSAL 3.
PROPOSAL 4: TO ELECT THE TRUSTEES OF TREASURER'S SERIES TRUST
The Board has nominated the individuals identified below for election to the
Board at the Meeting. Treasurer's Series Trust currently has ten trustees.
Vacancies on the Board are generally filled by appointment by the remaining
trustees. However, the 1940 Act provides that vacancies may not be filled by
trustees unless thereafter at least two-
20
<PAGE>
thirds of the trustees shall have been elected by shareholders. To ensure
continued compliance with this rule without incurring the expense of calling
additional shareholder meetings, shareholders are being asked at this Meeting
to elect the current ten trustees to hold office until the next meeting of
shareholders. Consistent with the by-laws of Treasurer's Series Trust, and as
permitted by Massachusetts law, Treasurer's Series Trust does not anticipate
holding annual shareholder meetings. Thus, the trustees will be elected for
indefinite terms, subject to termination or resignation. Each nominee has
indicated a willingness to serve if elected. If any of the nominees should not
be available for election, the persons named as proxies (or their substitutes)
may vote for other persons in their discretion. Management has no reason to
believe that any nominee will be unavailable for election.
All of the Independent Trustees now being proposed for election were
nominated and selected by Independent Trustees. Eight of the ten current
trustees are Independent Trustees.
The persons named as attorneys-in-fact in the enclosed proxy have advised
Treasurer's Series Trust that unless a proxy instructs them to withhold
authority to vote for all listed nominees or for any individual nominee, they
will vote all validly executed proxies for the election of the nominees named
below.
The nominees for trustee, their ages, a description of their principal
occupations, the number of the Funds' Shares owned by each, and their
respective memberships on Board committees are listed in the table below.
<TABLE>
<CAPTION>
Number of the
Funds' Shares
Trustee or Beneficially
Executive Owned
Officer of Directly or
Name, Position with Principal Occupation Treasurer's Indirectly on
Treasurer's Series and Business Experience Series Dec. 31, Member of
Trust, and Age (during the past five years) Trust Since 1998 (1) Committee
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Charles W. Brady, Chief Executive Officer and Director 1993 0 (3),(5),(6)
Chairman of the Board, of AMVESCAP PLC, London, England,
Age 63* and of various subsidiaries thereof.
Chairman of the Board of INVESCO
Global Health Sciences Fund.
Fred A. Deering, Trustee of INVESCO Global Health 1993 607.81 (2),(3),(5)
Vice Chairman of the Sciences Fund. Formerly, Chairman of
Board, the Executive Committee and Chairman
Age 71 of the Board of Security Life of
Denver Insurance Company, Denver,
Colorado; Director of ING American
Holdings Company and First ING Life
Insurance Company of New York.
Mark H. Williamson, President, Chief Executive Officer, 1998 0 (3),(5)
President, Chief Execu- and Director, INVESCO Distributors
tive Inc.; President, Chief Executive
Officer, and Trustee, Officer, and Director, INVESCO;
Age 47* President, Chief Operating Officer,
and Trustee, INVESCO Global Health
Sciences Fund. Formerly, Chairman of
the Board and Chief Executive
Officer, NationsBanc Advisors, Inc.
(1995-1997); Chairman of the Board,
NationsBanc Investments, Inc. (1997-
1998).
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
Number of the
Funds' Shares
Trustee or Beneficially
Executive Owned
Officer of Directly or
Name, Position with Principal Occupation Treasurer's Indirectly on
Treasurer's Series and Business Experience Series Dec. 31, Member of
Trust, and Age (during the past five years) Trust Since 1998 (1) Committee
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Dr. Victor L. Andrews, Professor Emeritus, Chairman 1993 201.18 (4),(6),(8)
Trustee, Emeritus and Chairman of the CFO
Age 68 Roundtable of the Department of
Finance of Georgia State University,
Atlanta, Georgia and President,
Andrews Financial Associates, Inc.
(consulting firm). Formerly, member
of the faculties of the Harvard
Business School and the Sloan School
of Management of MIT. Dr. Andrews is
also a director of the Sheffield
Funds, Inc.
Bob R. Baker, President and Chief Executive 1993 201.18 (3),(4),(5)
Trustee, Officer of AMC Cancer Research
Age 62 Center, Denver, Colorado, since
January 1989; until December 1988,
Vice Chairman of the Board, First
Columbia Financial Corporation,
Englewood, Colorado. Formerly,
Chairman of the Board and Chief
Executive Officer of First Columbia
Financial Corporation.
Lawrence H. Budner, Trust Consultant. Prior to June 1993 201.18 (2),(6),(7)
Trustee, 1987, Senior Vice President and
Age 68 Senior Trust Officer, InterFirst
Bank, Dallas, Texas.
Dr. Wendy Lee Gramm, Self-employed (since 1993). 1997 201.18 (4),(8)
Trustee, Professor of Economics and Public
Age 54 Administration, University of Texas
at Arlington. Formerly, Chairman,
Commodities Futures Trading
Commission (1988-1993);
Administrator for Information and
Regulatory Affairs, Office of
Management and Budget (1985-1988);
Executive Director, Presidential
Task Force on Regulatory Relief;
Director, Federal Trade Commissions
Bureau of Economics. Director of the
Chicago Mercantile Exchange; Enron
Corporation; IBP, Inc.; State Farm
Insurance Company; Independent
Women's Forum; International
Republic Institute; and the
Republican Women's Federal Forum.
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Number of the
Funds' Shares
Trustee or Beneficially
Name, Position Executive Owned
with Officer of Directly or
Treasurer's Principal Occupation Treasurer's Indirectly on
Series and Business Experience Series Dec. 31, Member of
Trust, and Age (during the past five years) Trust Since 1998 (1) Committee
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Kenneth T. King, Presently retired. Formerly, 1993 263,592.34 (2),(3),(5),
Trustee, Chairman of the Board, The Capitol (6), (7)
Age 73 Life Insurance Company, Providence
Washington Insurance Company, and
Director of numerous U.S.
subsidiaries thereof. Formerly,
Chairman of the Board, The
Providence Capitol Companies in the
United Kingdom and Guernsey. Until
1987, Chairman of the Board, Symbion
Corporation.
John W. McIntyre, Presently retired. Formerly, Vice 1995 402.36 (2),(3),(5),(7)
Trustee, Chairman of the Board, The Citizens
Age 68 and Southern Corporation; Chairman
of the Board and Chief Executive
Officer, The Citizens and Southern
Georgia Corporation; Chairman of the
Board and Chief Executive Officer,
The Citizens and Southern National
Bank. Trustee of INVESCO Global
Health Sciences Fund and Gables
Residential Trust, Employee's
Retirement System of Georgia, Emory
University, and the J.M. Tull
Charitable Foundation; director of
Kaiser Foundation Health Plans of
Georgia, Inc.
Dr. Larry Soll, Presently retired. Formerly, 1997 201.18 (4),(8)
Trustee, Chairman of the Board (1987-1994),
Age 56 Chief Executive Officer (1982-1989
and 1993-1994) and President (1982-
1989) of Synergen Inc. Director of
Synergen Inc. since incorporation in
1982. Director of Isis
Pharmaceuticals, Inc. Trustee of
INVESCO Global Health Sciences Fund.
</TABLE>
* Because of his affiliation with INVESCO, with a Fund's investment
adviser, or with companies affiliated with INVESCO, this individual is
deemed to be an "interested person" of Treasurers' Series Trust, as that
term is defined in the 1940 Act.
(1) As interpreted by the SEC, a security is beneficially owned by a person
if that person has or shares voting power or investment power with
respect to that security. The persons listed have partial or complete
voting and investment power with respect to their respective Fund
shares.
23
<PAGE>
(2) Member of the Audit Committee
(3) Member of the Executive Committee
(4) Member of the Management Liaison Committee
(5) Member of the Valuation Committee
(6) Member of the Compensation Committee
(7) Member of the Soft Dollar Brokerage Committee
(8) Member of the Derivatives Committee
The Board has audit, management liaison, soft dollar brokerage, and
derivatives committees consisting of Independent Trustees and compensation,
executive and valuation committees consisting of both Independent Trustees and
non-independent trustees. The Board does not have a nominating committee. The
audit committee, consisting of four Independent Trustees, meets quarterly with
the independent accountants and executive officers of Treasurer's Series
Trust. This committee reviews the accounting principles being applied by
Treasurer's Series Trust in financial reporting, the scope and adequacy of
internal controls, the responsibilities and fees of the independent
accountants, and other matters. All of the recommendations of the audit
committee are reported to the full Board. During the intervals between the
meetings of the Board, the executive committee may exercise all powers and
authority of the Board in the management of the business of Treasurer's Series
Trust, except for certain powers which, under applicable law and/or the by-
laws of Treasurer's Series Trust, may only be exercised by the full Board. All
decisions are subsequently submitted for ratification by the Board. The
management liaison committee meets quarterly with various management personnel
of ICM in order to facilitate better understanding of the management and
operations of Treasurer's Series Trust, and to review legal and operational
matters that have been assigned to the committee by the Board, in furtherance
of the Board's overall duty of supervision. The soft dollar brokerage
committee meets periodically to review soft dollar brokerage transactions by
Treasurer's Series Trust, and to review policies and procedures of Treasurer's
Series Trust's adviser with respect to soft dollar brokerage transactions. The
committee then reports on these matters to the Board. The derivatives
committee meets periodically to review derivatives investments made by
Treasurer's Series Trust. The committee monitors derivatives usage by
Treasurer's Series Trust and the procedures utilized by Treasurer's Series
Trust's adviser to ensure that the use of such instruments follows the
policies on such instruments adopted by the Board. The committee then reports
on these matters to the Board.
Each Independent Trustee receives an annual retainer of $56,000 for their
service to the INVESCO Funds. Additionally, each Independent Trustee receives
$3,000 for in-person attendance at each board meeting and $1,000 for in-person
attendance at each committee meeting. The chairmen of the audit and management
liaison committees receive an annual fee of $4,000 for serving in such
capacity.
During the past fiscal year, the Board met four times, the audit committee
met four times, the compensation committee met one time, the management
liaison committee met four times, the soft dollar brokerage committee met two
times, and the derivatives committee met two times. The executive committee
did not meet. During the last fiscal year of Treasurer's Series Trust, each
trustee nominee attended 75% or more of the Board meetings and meetings of the
committees of the Board on which he or she served.
The Independent Trustees nominate individuals to serve as Independent
Trustees, without any specific nominating committees. The Board ordinarily
will not consider unsolicited trustee nominations recommended by Treasurer's
Series Trust shareholders. The Board, including its Independent Trustees,
unanimously approved the nomination of the foregoing persons to serve as
trustees and directed that the election of these nominees be submitted to the
Funds' shareholders.
24
<PAGE>
The following table sets forth information relating to the compensation paid to
trustees during the last fiscal year:
COMPENSATION TABLE
AMOUNTS PAID DURING THE MOST RECENT FISCAL YEAR BY TREASURER'S SERIES TRUST TO
TRUSTEES
<TABLE>
<CAPTION>
Total
Compensation
from Treasurer's
Pension or Series Trust and
Aggregate Retirement Benefits the other 14
Compensation from Accrued as Part of Estimated Annual INVESCO Funds
Name of Person, Treasurer's Treasurer's Series Benefits Upon Paid to
Position Series Trust Trust Expenses(2) Retirement(3) Trustees(1)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Fred A Deering,
Vice Chairman of the
Board and Trustee $ 2,172 $ 227 $153 $103,700
Dr. Victor L. Andrews,
Trustee $ 2,149 $ 217 $169 $ 80,350
Bob R. Baker,
Trustee $ 2,166 $ 194 $226 $ 84,000
Lawrence H. Budner,
Trustee $ 2,144 $ 217 $169 $ 79,350
Daniel D. Chabris,(4)
Trustee $ 1,622 $ 222 $139 $ 70,000
Dr. Wendy L. Gramm,
Trustee $ 2,143 $ 0 $ 0 $ 79,000
Kenneth T. King,
Trustee $ 2,133 $ 231 $139 $ 77,050
John W. McIntyre,
Trustee $ 2,144 $ 0 $ 0 $ 98,500
Dr. Larry Soll,
Trustee $ 2,138 $ 0 $ 0 $ 96,000
------- ------ ---- --------
TOTAL $18,811 $1,308 $995 $767,950
======= ====== ==== ========
AS A PERCENTAGE OF
NET ASSETS 0.0249%(5) 0.0017%(5) 0.0035%(6)
</TABLE>
25
<PAGE>
(1) The Vice Chairman of the board, the chairmen of the audit, management
liaison, derivatives, soft dollar brokerage and compensation committees, and
the Independent Trustee members of the committees receive compensation for
serving in such capacities in addition to the compensation paid to all
Independent Trustees.
(2) Represents benefits accrued with respect to the Defined Benefit Deferred
Compensation Plan discussed below, and not compensation deferred at the
election of the trustees.
(3) These figures represent Treasurer's Series Trust's share of the estimated
annual benefits payable by the INVESCO Complex (excluding INVESCO Global
Health Sciences Fund which does not participate in this retirement plan) upon
the trustees' retirement, calculated using the current method of allocating
trustee compensation among the INVESCO Funds. These estimated benefits assume
retirement at age 72 and that the basic retainer payable to the trustees will
be adjusted periodically for inflation, for increases in the number of funds
in the INVESCO Complex, and for other reasons during the period in which
retirement benefits are accrued on behalf of the respective trustees. This
results in lower estimated benefits for trustees who are closer to retirement
and higher estimated benefits for directors who are farther from retirement.
With the exception of Drs. Soll and Gramm, each of these trustees has served
as trustee or director of one or more of the INVESCO Funds for the minimum
five-year period required to be eligible to participate in the Defined Benefit
Deferred Compensation Plan. Although Mr. McIntyre became eligible to
participate in the Defined Benefit Deferred Compensation Plan as of November
1, 1998, he will not be included in the calculation of retirement benefits
until November 1, 1999.
(4) Mr. Chabris retired as a trustee effective September 30, 1998.
(5) Total as a percentage of Treasurer's Series Trust's net assets as of
December 31, 1998.
(6) Total as a percentage of the net assets of the 15 INVESCO Funds in the
INVESCO Complex as of December 31, 1998.
Treasurer's Series Trust pays its Independent Trustees, Board vice chairman,
committee chairmen, and committee members the fees described above.
Treasurer's Series Trust also reimburses its Independent Trustees for travel
expenses incurred in attending meetings. Charles W. Brady, Chairman of the
Board, and Mark H. Williamson, President, Chief Executive Officer, and
Trustee, as "interested persons" of Treasurer's Series Trust and of other
INVESCO Funds, receive compensation and are reimbursed for travel expenses
incurred in attending meetings as officers or employees of INVESCO or its
affiliated companies, but do not receive any trustee's fees or other
compensation from Treasurer's Series Trust or other INVESCO Funds for their
services as trustees or directors.
The overall direction and supervision of Treasurer's Series Trust is the
responsibility of the Board, which has the primary duty of ensuring that
Treasurer's Series Trust's general investment policies and programs are
adhered to and that Treasurer's Series Trust is properly administered. The
officers of Treasurer's Series Trust, all of whom are officers and employees
of and paid by INVESCO, are responsible for the day-to-day administration of
Treasurer's Series Trust. INVESCO Capital Management ("ICM"), as investment
adviser for Treasurer's Series Trust, has the primary responsibility for
making investment decisions on behalf of Treasurer's Series Trust.
All of the officers and trustees of Treasurer's Series Trust hold comparable
positions with the following INVESCO Funds: INVESCO Bond Funds, Inc.
(formerly, INVESCO Income Funds, Inc.), INVESCO Combination Stock & Bond
Funds, Inc. (formerly, INVESCO Flexible Funds, Inc. and INVESCO Multiple Asset
Funds, Inc.), INVESCO Diversified Funds, Inc., INVESCO Growth Funds, Inc.
(formerly, INVESCO Growth Fund, Inc.), INVESCO Emerging Opportunity Funds,
Inc., INVESCO Industrial Income Fund, Inc., INVESCO International Funds, Inc.,
INVESCO Money Market Funds, Inc., INVESCO Sector Funds, Inc. (formerly,
INVESCO Strategic Portfolios, Inc.), INVESCO Stock Funds, Inc. (formerly,
INVESCO Equity Funds, Inc. and INVESCO Capital Appreciation Funds, Inc.),
INVESCO Tax-Free Income Funds, Inc., and INVESCO Variable Investment Funds,
Inc. All of the trustees and officers of Treasurer's Series Trust also hold
comparable positions with INVESCO Value Trust.
The Boards of the Funds managed by INVESCO have adopted a Defined Benefit
Deferred Compensation Plan (the "Plan") for the non-interested trustees of
Treasurer's Series Trust. Under the Plan, each trustee who is not an
interested person of Treasurer's Series Trust (as defined in Section 2(a)(19)
of the 1940 Act) and who has served for at least five years (a
"QualifiedTrustee") is entitled to receive, upon termination of service as
trustee (normally at retirement age 72 or the retirement age of 73 or 74, if
the retirement date is extended by the Boards for one or two
26
<PAGE>
years, but less than three years) continuation of payment for one year (the
"First Year Retirement Benefit") of the annual basic retainer and annualized
board meeting fees payable by the Funds to the Qualified Trustees at the time
of his or her retirement (the "Basic Benefit"). Commencing with any such
trustee's second year of retirement, and commencing with the first year of
retirement of any trustee whose retirement has been extended by the Board for
three years, a Qualified Trustee shall receive quarterly payments at an annual
rate equal to 50% of the Basic Benefit (the "Reduced Benefit Payments"). These
payments will continue for the remainder of the Qualified Trustee's life or
ten years, whichever is longer. If a Qualified Trustee dies or becomes
disabled after age 72 and before age 74 while still a trustee of the Funds,
the First Year Retirement Benefit and Reduced Benefit Payments will be made to
him or her or to his or her beneficiary or estate. If a Qualified Trustee
becomes disabled or dies either prior to age 72 or during his or her 74th year
while still a trustee of Treasurer's Series Trust, the trustee will not be
entitled to receive the First Year Retirement Benefit; however, the Reduced
Benefit Payments will be made to his or her beneficiary or estate. The Plan is
administered by a committee of three trustees who are also participants in the
Plan and one trustee who is not a Plan participant. The cost of the Plan will
be allocated among the INVESCO Funds in a manner determined to be fair and
equitable by the committee. The Treasurer's Series Trust began making payments
to Mr. Chabris as of October 1, 1998 under the Plan. The Treasurer's Series
Trust has no stock options or other pension or retirement plans for management
or other personnel and pays no salary or compensation to any of its officers.
The Independent Trustees have contributed to a deferred compensation plan,
pursuant to which they have deferred receipt of a portion of the compensation
which they would otherwise have been paid as directors of certain of the
INVESCO Funds. The deferred amounts have been invested in shares of certain
INVESCO Funds. Each Independent Trustee may, therefore, be deemed to have an
indirect interest in shares of each such INVESCO Fund, in addition to any Fund
shares that they may own directly or beneficially.
Vote Required. Election of each nominee as a trustee of Treasurer's Series
Trust requires the affirmative vote of a plurality of the votes cast at the
Meeting in person or by proxy.
THE BOARD, INCLUDING THE INDEPENDENT TRUSTEES, UNANIMOUSLY
RECOMMENDS THAT SHAREHOLDERS VOTE "FOR"
EACH OF THE NOMINEES IN PROPOSAL 4.
PROPOSAL 5: RATIFICATION OR REJECTION OFSELECTION OF INDEPENDENT ACCOUNTANTS.
The Board of Treasurer's Series Trust, including all of its Independent
Trustees, has selected PricewaterhouseCoopers LLP to continue to serve as
independent accountants of each Fund, subject to ratification by each Fund's
shareholders. PricewaterhouseCoopers LLP has no direct financial interest or
material indirect financial interest in any Fund. Representatives of
PricewaterhouseCoopers LLP are not expected to attend the Meeting, but have
been given the opportunity to make a statement if they so desire, and will be
available should any matter arise requiring their presence.
The independent accountants examine annual financial statements for the
Funds and provide other audit and tax-related services. In recommending the
selection of PricewaterhouseCoopers LLP, the Board reviewed the nature and
scope of the services to be provided (including non-audit services) and
whether the performance of such services would affect the accountants'
independence.
Vote Required. Approval of Proposal 5 requires the affirmative vote of a
majority of the votes present at the Meeting, provided that a quorum is
present.
27
<PAGE>
THE BOARD UNANIMOUSLY RECOMMENDS THAT THE
SHAREHOLDERS VOTE "FOR" PROPOSAL 5.
OTHER BUSINESS
The Board knows of no other business to be brought before the Meeting. If,
however, any other matters properly come before the Meeting, it is the
intention that proxies that do not contain specific instructions to the
contrary will be voted on such matters in accordance with the judgment of the
persons designated in the proxies.
INFORMATION CONCERNING ADVISER,
DISTRIBUTOR AND AFFILIATED COMPANIES
ICM, a Delaware corporation, serves as Treasurer's Series Trust's investment
adviser, and provides other services to Money Fund, Tax-Exempt Fund and
Treasurer's Series Trust. IDI, a Delaware corporation, serves as Money Fund's
and Tax-Exempt Fund's distributor. ICM and IDI are indirect wholly owned
subsidiaries of AMVESCAP PLC./1/
INVESCO's and IDI's offices are located at 7800 East Union Avenue, Denver,
Colorado 80237. ICM's offices are located at 1315 Peachtree Street, N.E.,
Atlanta, Georgia 30309. The corporate headquarters of AMVESCAP PLC are located
at 11 Devonshire Square, London, EC2M 4YR, England. ICM currently manages in
excess of $48 billion of assets for its customers.
The principal executive officers and directors of INVESCO and their
principal occupations are:
Mark H. Williamson, Chairman of the Board, President, Chief Executive
Officer and Director, also, President and Chief Executive Officer of IDI;
Charles P. Mayer, Director and Senior Vice President, also, and Director and
Senior Vice President of IDI; Ronald L. Grooms, Director, Senior Vice
President and Treasurer, also Director, Senior Vice President and Treasurer of
IDI; Richard W. Healey, Director and Senior Vice President, also, Director and
Senior Vice President of IDI; Timothy J. Miller, Director and Senior Vice
President, also, Director and Senior Vice President of IDI; and Glen A. Payne,
Senior Vice President, Secretary and General Counsel, also Senior Vice
President, Secretary and General Counsel of IDI.
The address of each of the foregoing officers and directors is 7800 East
Union Avenue, Denver, Colorado 80237.
The principal executive officers and directors of ICM and their principal
occupations are:
Frank M. Bishop, President, Chief Executive Officer and Director; Edward C.
Mitchell, Jr., Chairman of the Board; Terrence J. Miller, Deputy President and
Director; Timothy J. Culler, Chief Investment Officer, Vice President and
Director; David Hartley, Chief Financial Officer and Treasurer; Julie A.
Skaggs, Vice President and Secretary; Luis A. Aguilar, Vice President and
Assistant Secretary; Stephen A. Dana, Vice President and Director; Thomas W.
Norwood, Vice President and Director; Donald B. Salee, Vice President and
Director; Thomas L. Shields, Vice President and Director; Wendell M. Starke,
Vice President and Director; A. D. Frazier, Director; and Deborah Lamb,
Assistant Secretary.
- --------
(1) The intermediary companies between ICM and AMVESCAP PLC are as follows:
INVESCO, Inc., AMVESCAP Group Services, Inc., AVZ, Inc. and INVESCO North
American Group, Ltd., each of which is wholly owned by its immediate
parent.
28
<PAGE>
The address of each of the foregoing officers and directors is 1315
Peachtree Street, N.E., Atlanta, Georgia 30309.
During the fiscal year ended December 31, 1998 ICM also absorbed and paid,
pursuant to the management contract, all the expenses of INVESCO in its
capacity as Treasurer's Series Trust's administrator, transfer agent and
dividend disbursing agent.
MISCELLANEOUS
Available Information
Each Fund is subject to the information requirements of the Securities
Exchange Act of 1934 and the 1940 Act and in accordance with those
requirements files reports, proxy material and other information with the SEC.
These reports, proxy material and other information can be inspected and
copied at the Public Reference Room maintained by the SEC at 450 Fifth Street,
N.W., Washington, D.C. 20549, The Midwest Regional office of the SEC,
Northwest Atrium Center, 500 West Madison Street, Suite 400, Chicago, Illinois
60611, and the Northeast Regional Office of the SEC, Seven World Trade Center,
Suite 1300, New York, New York 10048. Copies of such material can also be
obtained from the Public Reference Branch, Office of Consumer Affairs and
Information Services, Securities and Exchange Commission, Washington, D.C.
20459 at prescribed rates. In addition, reports and other information about
each Fund are available on the SEC's web site at http://www.sec.gov.
Legal Matters
Certain legal matters in connection with the issuance of INVESCO Treasurer's
Series Funds, Inc. Fund shares as part of the Conversions will be passed upon
by INVESCO Treasurer's Series Funds, Inc. counsel, Kirkpatrick & Lockhart LLP.
Experts
The audited financial statements of Money Fund and Tax-Exempt Fund,
incorporated herein by reference and incorporated by reference or included in
their respective Statements of Additional Information, have been audited by
PricewaterhouseCoopers LLP, independent accountants for the Funds, whose
reports thereon are included in the Funds' Annual Reports to Shareholders for
the fiscal year or period ended December 31, 1998. The financial statements
audited by PricewaterhouseCoopers LLP have been incorporated herein by
reference in reliance on their reports given on their authority as experts in
auditing and accounting matters.
29
<PAGE>
SHAREHOLDER PROPOSALS
Treasurer's Series Trust does not hold annual meetings of shareholders.
Shareholders wishing to submit proposals for inclusion in a proxy statement
and form of proxy for a subsequent shareholders' meeting should send their
written proposals to the Secretary of Treasurer's Series Trust, 7800 East
Union Avenue, Denver, Colorado 80237. Treasurer's Series Trust has not
received any shareholder proposals to be presented at this Meeting.
By order of the Board of Trustees
/s/ Glen A. Payne
Glen A. Payne
Secretary
March 23, 1999
30
<PAGE>
APPENDIX A
PRINCIPAL SHAREHOLDERS
The following table sets forth the beneficial ownership of each Fund's
outstanding equity securities as of March 12, 1999 by each beneficial owner of
5% or more of Money Fund's and Tax-Exempt Fund's outstanding equity
securities:
Name and Address Amount and Nature of Ownership Percent
Beneficial owners of 5% or more of Money Fund
<TABLE>
<CAPTION>
<S> <C>
INVESCO Capital Management, Inc. 12,318,662.2300 25.76%
Attn: Michelle Lomonaco
1315 Peachtree St. N.E.
Suite 400
Atlanta, GA 30309-3503
Teamster Local Union 918 6,172,701.9700 12.91%
Welfare Fund
2137-2147 Utica Ave.
Brooklyn, NY 11234-3827
3,323,344.9800 6.95%
GA Amateur Athletics Foundation, Inc.
c/o Robert F. McCullough, INVESCO
1315 Peachtree St. N.E.
Suite 500
Atlanta, GA 30309-3503
WSU Endowment Association
1845 Fairmount 2,941,504.7600 6.15%
Wichita, KS 67260-0001
</TABLE>
A-1
<PAGE>
Name and Address Amount and Nature of Ownership Percentage
Beneficial owners of 5% or more of Tax-Exempt Fund
<TABLE>
<CAPTION>
<S> <C> <C>
J. B. Fuqua 4,713,314.1500 13.01%
Suite 5000
1201 W. Peachtree St. N.E.
Atlanta, GA 30309-3400
Alice H. Richards 4,514,412.9200 12.46%
P.O. Box 400
Carrollton, GA 30117-0400
Willis M. Everett III 3,785,728.5000 10.45%
Cottage 89
P.O. Box 30832
Sea Island, GA 31561-0832
Realan Capital Corporation 3,239,573.2100 8.94%
1201 W. Peachtree St. N.E.
Suite 5000
Atlanta, GA 30309-3400
J. Rex Fuqua 2,969,697.7500 8.20%
c/o Fuqua Capital Corp.
1201 W. Peachtree St. N.E.
Atlanta, GA 30309
Thomas L. Shields, Jr. 2,820,225.8900 7.78%
1750 W. Sussex
Atlanta, GA 30306
Stephen A. Dana
1315 Peachtree St. N.E. 2,428,231.8900 6.70%
Suite 300
Atlanta, GA 30309
Hubert L. Harris, Jr. 1,848,097.7100 5.10%
4606 Polo Lane
Atlanta, GA 30339-5346
</TABLE>
A-2
<PAGE>
APPENDIX B
AGREEMENT AND PLAN OF CONVERSION AND TERMINATION
This AGREEMENT AND PLAN OF CONVERSION AND TERMINATION ("Agreement") is made
as of March 23, 1999, between INVESCO Treasurer's Series Trust, a
Massachusetts business trust ("Trust"), on behalf of INVESCO Money Market
Reserve Fund and INVESCO Treasurer's Tax-Exempt Reserve Fund, each a
segregated portfolio of assets ("series") of Trust (each, an "Old Fund"), and
INVESCO Treasurers' Series Funds, Inc., a Maryland corporation
("Corporation"), on behalf of its INVESCO Money Market Reserve Fund series and
INVESCO Treasurers' Tax-Exempt Reserve Fund series (each, a "New Fund"). (Each
Old Fund and New Fund is sometimes referred to herein individually as a "Fund"
and collectively as the "Funds"; and Trust and Corporation are sometimes
referred to herein individually as an "Investment Company.") All agreements,
representations, actions, and obligations described herein made or to be taken
or undertaken by either Fund are made and shall be taken or undertaken by
Trust on behalf of each Old Fund and by Corporation on behalf of each New
Fund.
Each Old Fund intends to change its form, identity, and place of
organization -- by converting from a series of a Massachusetts business trust
to a series of a Maryland corporation -- through a reorganization within the
meaning of section 368(a)(1)(F) of the Internal Revenue Code of 1986, as
amended ("Code"). Each Old Fund desires to accomplish such conversion by
transferring all its assets to its corresponding New Fund (i.e., the New Fund
with the same name) (which is being established solely for the purpose of
acquiring such assets and continuing Old Fund's business) in exchange solely
for voting shares of common stock in such New Fund ("New Fund Shares") and
such New Fund's assumption of such Old Fund's liabilities, followed by the
constructive distribution of the New Fund Shares pro rata to the holders of
shares of beneficial interest in such Old Fund ("Old Fund Shares") in exchange
therefor, all on the terms and conditions set forth in this Agreement (which
is intended to be, and is adopted as, a "plan of reorganization" for federal
income tax purposes). All such transactions involving each Old Fund and its
corresponding New Fund are referred to herein as a "Reorganization." For
convenience, the balance of this Agreement will refer to a single
Reorganization, one Old Fund, and one New Fund, but the terms and conditions
of this Agreement shall apply separately to each Reorganization. The
consummation of one Reorganization shall not be contingent on consummation of
the other Reorganization.
In consideration of the mutual promises herein contained, the parties agree
as follows:
1. PLAN OF CONVERSION AND TERMINATION
1.1. Old Fund agrees to assign, sell, convey, transfer, and deliver all of its
assets described in paragraph 1.2 ("Assets") to New Fund. New Fund agrees in
exchange therefor --
(a) to issue and deliver to Old Fund the number of full and fractional
(rounded to the third decimal place) New Fund Shares equal to the number of
full and fractional Old Fund Shares then outstanding, and
(b) to assume all of Old Fund's liabilities described in paragraph 1.3
("Liabilities").
Such transactions shall take place at the Closing (as defined in paragraph
2.1).
1.2. The Assets shall include, without limitation, all cash, cash equivalents,
securities, receivables (including interest and dividends receivable), claims
and rights of action, rights to register shares under applicable securities
laws, books and records, deferred and prepaid expenses shown as assets on Old
Fund's books, and other property owned by Old Fund at the Effective Time (as
defined in paragraph 2.1).
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<PAGE>
1.3. The Liabilities shall include all of Old Fund's liabilities, debts,
obligations, and duties of whatever kind or nature, whether absolute, accrued,
contingent, or otherwise, whether or not arising in the ordinary course of
business, whether or not determinable at the Effective Time, and whether or
not specifically referred to in this Agreement.
1.4. At the Effective Time (or as soon thereafter as is reasonably
practicable), (a) the New Fund Share issued pursuant to paragraph 4.4 shall be
redeemed by New Fund for $1.00 and (b) Old Fund shall distribute the New Fund
Shares it received pursuant to paragraph 1.1 to its shareholders of record,
determined as of the Effective Time (each a "Shareholder" and collectively
"Shareholders"), in constructive exchange for their Old Fund Shares. Such
distribution shall be accomplished by Corporation's transfer agent's opening
accounts on New Fund's share transfer books in the Shareholders' names and
transferring such New Fund Shares thereto. Each Shareholder's account shall be
credited with the respective pro rata number of full and fractional (rounded
to the third decimal place) New Fund Shares due that Shareholder. All
outstanding Old Fund Shares, including those represented by certificates,
shall simultaneously be canceled on Old Fund's share transfer books. New Fund
shall not issue certificates representing the New Fund Shares in connection
with the Reorganization.
1.5. As soon as reasonably practicable after distribution of the New Fund
Shares pursuant to paragraph 1.4, but in all events within twelve months after
the Effective Time, Old Fund shall be terminated as a series of Trust and any
further actions shall be taken in connection therewith as required by
applicable law.
1.6. Any reporting responsibility of Old Fund to a public authority is and
shall remain its responsibility up to and including the date on which it is
terminated.
1.7. Any transfer taxes payable on issuance of New Fund Shares in a name
other than that of the registered holder on Old Fund's books of the Old Fund
Shares constructively exchanged therefor shall be paid by the person to whom
such New Fund Shares are to be issued, as a condition of such transfer.
2. CLOSING AND EFFECTIVE TIME
2.1. The Reorganization, together with related acts necessary to consummate
the same ("Closing"), shall occur at the Funds' principal office on May 30,
1999, or at such other place and/or on such other date as to which the parties
may agree. All acts taking place at the Closing shall be deemed to take place
simultaneously as of the close of business on the date thereof or at such
other time as to which the parties may agree ("Effective Time").
2.2. Trust's fund accounting and pricing agent shall deliver at the Closing a
certificate of an authorized officer verifying that the information (including
adjusted basis and holding period, by lot) concerning the Assets, including
all portfolio securities, transferred by Old Fund to New Fund, as reflected on
New Fund's books immediately following the Closing, does or will conform to
such information on Old Fund's books immediately before the Closing. Trust's
custodian shall deliver at the Closing a certificate of an authorized officer
stating that (a) the Assets held by the custodian will be transferred to New
Fund at the Effective Time and (b) all necessary taxes in conjunction with the
delivery of the Assets, including all applicable federal and state stock
transfer stamps, if any, have been paid or provision for payment has been
made.
2.3. Corporation's transfer agent shall deliver at the Closing a certificate
as to the opening on New Fund's share transfer books of accounts in the
Shareholders' names. Corporation shall issue and deliver a confirmation to
Trust evidencing the New Fund Shares to be credited to Old Fund at the
Effective Time or provide evidence satisfactory to Trust that such New Fund
Shares have been credited to Old Fund's account on such books. At the Closing,
each party shall deliver to the other such bills of sale, checks, assignments,
stock certificates, receipts, or other documents as the other party or its
counsel may reasonably request.
B-2
<PAGE>
2.4. Each Investment Company shall deliver to the other at the Closing a
certificate executed in its name by its President or a Vice President in form
and substance satisfactory to the recipient and dated the Effective Time, to
the effect that the representations and warranties it made in this Agreement
are true and correct at the Effective Time except as they may be affected by
the transactions contemplated by this Agreement.
3. REPRESENTATIONS AND WARRANTIES
3.1. Old Fund represents and warrants as follows:
3.1.1. Trust is a trust operating under a written declaration of trust, the
beneficial interest in which is divided into transferable shares, that is
duly organized and validly existing under the laws of the Commonwealth of
Massachusetts; and a copy of its Declaration of Trust is on file with the
Secretary of the Commonwealth of Massachusetts;
3.1.2. Trust is duly registered as an open-end management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"),
and such registration will be in full force and effect at the Effective
Time;
3.1.3. Old Fund is a duly established and designated series of Trust;
3.1.4. At the Closing, Old Fund will have good and marketable title to the
Assets and full right, power, and authority to sell, assign, transfer, and
deliver the Assets free of any liens or other encumbrances; and upon
delivery and payment for the Assets, New Fund will acquire good and
marketable title thereto;
3.1.5. New Fund Shares are not being acquired for the purpose of making any
distribution thereof, other than in accordance with the terms hereof;
3.1.6. Old Fund is a "fund" as defined in section 851(g)(2) of the Code; it
qualified for treatment as a regulated investment company under Subchapter
M of the Code ("RIC") for each past taxable year since it commenced
operations and will continue to meet all the requirements for such
qualification for its current taxable year; and it has no earnings and
profits accumulated in any taxable year in which the provisions of
Subchapter M did not apply to it. The Assets shall be invested at all times
through the Effective Time in a manner that ensures compliance with the
foregoing;
3.1.7. The Liabilities were incurred by Old Fund in the ordinary course of
its business and are associated with the Assets;
3.1.8. Old Fund is not under the jurisdiction of a court in a proceeding
under Title 11 of the United States Code or similar case within the meaning
of section 368(a)(3)(A) of the Code;
3.1.9. Not more than 25% of the value of Old Fund's total assets (excluding
cash, cash items, and U.S. government securities) is invested in the stock
and securities of any one issuer, and not more than 50% of the value of
such assets is invested in the stock and securities of five or fewer
issuers;
3.1.10. As of the Effective Time, Old Fund will not have outstanding any
warrants, options, convertible securities, or any other type of rights
pursuant to which any person could acquire Old Fund Shares;
3.1.11. At the Effective Time, the performance of this Agreement shall have
been duly authorized by all necessary action by Old Fund's shareholders;
and
B-3
<PAGE>
3.1.12. Old Fund will be terminated as soon as reasonably practicable after
the Effective Time, but in all events within twelve months thereafter.
3.2. New Fund represents and warrants as follows:
3.2.1. Corporation is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Maryland; and a copy of its
Articles of Incorporation is on file with the Secretary of State of Maryland;
3.2.2. Corporation is duly registered as an open-end management investment
company under the 1940 Act, and such registration will be in full force and
effect at the Effective Time;
3.2.3. Before the Effective Time, New Fund will be a duly established and
designated series of Corporation;
3.2.4. New Fund has not commenced operations and will not do so until after
the Closing;
3.2.5. Prior to the Effective Time, there will be no issued and outstanding
shares in New Fund or any other securities issued by New Fund, except as
provided in paragraph 4.4;
3.2.6. No consideration other than New Fund Shares (and New Fund's assumption
of the Liabilities) will be issued in exchange for the Assets in the
Reorganization;
3.2.7. The New Fund Shares to be issued and delivered to Old Fund hereunder
will, at the Effective Time, have been duly authorized and, when issued and
delivered as provided herein, will be duly and validly issued and outstanding
shares of New Fund, fully paid and non-assessable;
3.2.8. New Fund will be a "fund" as defined in section 851(g)(2) of the Code
and will meet all the requirements to qualify for treatment as a RIC for its
taxable year in which the Reorganization occurs;
3.2.9. New Fund has no plan or intention to issue additional New Fund Shares
following the Reorganization except for shares issued in the ordinary course
of its business as a series of an open-end investment company; nor does New
Fund have any plan or intention to redeem or otherwise reacquire any New Fund
Shares issued to the Shareholders pursuant to the Reorganization, except to
the extent it is required by the 1940 Act to redeem any of its shares
presented for redemption at net asset value in the ordinary course of that
business;
3.2.10. Following the Reorganization, New Fund (a) will continue Old Fund's
"historic business" (within the meaning of section 1.368-1(d)(2) of the Income
Tax Regulations under the Code), (b) use a significant portion of Old Fund's
historic business assets (within the meaning of section 1.368-1(d)(3) of those
regulations) in a business, (c) has no plan or intention to sell or otherwise
dispose of any of the Assets, except for dispositions made in the ordinary
course of that business and dispositions necessary to maintain its status as a
RIC, and (d) expects to retain substantially all the Assets in the same form
as it receives them in the Reorganization, unless and until subsequent
investment circumstances suggest the desirability of change or it becomes
necessary to make dispositions thereof to maintain such status;
3.2.11. There is no plan or intention for New Fund to be dissolved or merged
into another corporation or a business trust or any "fund" thereof (within the
meaning of section 851(g)(2) of the Code) following the Reorganization; and
3.2.12. Immediately after the Reorganization, (a) not more than 25% of the
value of New Fund's total assets (excluding cash, cash items, and U.S.
government securities) will be invested in the stock and securities of any one
issuer and (b) not more than 50% of the value of such assets will be invested
in the stock and securities of five or fewer issuers.
3.3. Each Fund represents and warrants as follows:
3.3.1. The aggregate fair market value of the New Fund Shares, when received
by the Shareholders, will be approximately equal to the aggregate fair market
value of their Old Fund Shares constructively surrendered in exchange
therefor;
B-4
<PAGE>
3.3.2. Its management (a) is unaware of any plan or intention of Shareholders
to redeem, sell, or otherwise dispose of (i) any portion of their Old Fund
Shares before the Reorganization to any person related (within the meaning of
section 1.368-1(e)(3) of the Income Tax Regulations under the Code) to either
Fund or (ii) any portion of the New Fund Shares to be received by them in the
Reorganization to any person related (as so defined) to New Fund, (b) does not
anticipate dispositions of those New Fund Shares at the time of or soon after
the Reorganization to exceed the usual rate and frequency of dispositions of
shares of Old Fund as a series of an open-end investment company, (c) expects
that the percentage of Shareholder interests, if any, that will be disposed of
as a result of or at the time of the Reorganization will be de minimis, and
(d) does not anticipate that there will be extraordinary redemptions of New
Fund Shares immediately following the Reorganization;
3.3.3. The Shareholders will pay their own expenses, if any, incurred in
connection with the Reorganization;
3.3.4. Immediately following consummation of the Reorganization, the
Shareholders will own all the New Fund Shares and will own such shares
solely by reason of their ownership of Old Fund Shares immediately before
the Reorganization;
3.3.5. Immediately following consummation of the Reorganization, New Fund
will hold the same assets-- except for assets distributed to shareholders
in the course of its business as a RIC and assets used to pay expenses
incurred in connection with the Reorganization -- and be subject to the
same liabilities that Old Fund held or was subject to immediately prior to
the Reorganization, plus any liabilities for expenses of the parties
incurred in connection with the Reorganization. Such excepted assets,
together with the amount of all redemptions and distributions (other than
regular, normal dividends) made by Old Fund immediately preceding the
Reorganization, will, in the aggregate, constitute less than 1% of its net
assets;
3.3.6. There is no intercompany indebtedness between the Funds that was
issued or acquired, or will be settled, at a discount; and
3.3.7. Neither Fund will be reimbursed for any expenses incurred by it or
on its behalf in connection with the Reorganization unless those expenses
are solely and directly related to the Reorganization (determined in
accordance with the guidelines set forth in Rev. Rul. 73-54, 1973-1 C.B.
187) ("Reorganization Expenses").
4.CONDITIONS PRECEDENT
Each Fund's obligations hereunder shall be subject to (a) performance by the
other Fund of all its obligations to be performed hereunder at or before the
Effective Time, (b) all representations and warranties of the other Fund
contained herein being true and correct in all material respects as of the
date hereof and, except as they may be affected by the transactions
contemplated hereby, as of the Effective Time, with the same force and effect
as if made on and as of the Effective Time, and (c) the further conditions
that, at or before the Effective Time:
4.1. This Agreement and the transactions contemplated hereby shall have been
duly adopted and approved by Trust's board of trustees and Corporation's board
of directors (each, a "board") and shall have been approved by Old Fund's
shareholders in accordance with applicable law;
4.2. All necessary filings shall have been made with the Securities and
Exchange Commission ("SEC") and state securities authorities, and no order or
directive shall have been received that any other or further action is
required to permit the parties to carry out the transactions contemplated
hereby. All consents, orders, and permits of
B-5
<PAGE>
federal, state, and local regulatory authorities (including the SEC and state
securities authorities) deemed necessary by either Investment Company to
permit consummation, in all material respects, of the transactions
contemplated hereby shall have been obtained, except where failure to obtain
same would not involve a risk of a material adverse effect on the assets or
properties of either Fund, provided that either Investment Company may for
itself waive any of such conditions;
4.3. Each Investment Company shall have received an opinion of Kirkpatrick &
Lockhart LLP, addressed to and in form and substance satisfactory to it, as to
the federal income tax consequences mentioned below ("Tax Opinion"). In
rendering the Tax Opinion, such counsel may rely as to factual matters,
exclusively and without independent verification, on the representations made
in this Agreement (or in separate letters addressed to such counsel) and the
certificates delivered pursuant to paragraph 2.4. The Tax Opinion shall be
substantially to the effect that, based on the facts and assumptions stated
therein and conditioned on consummation of the Reorganization in accordance
with this Agreement, for federal income tax purposes:
4.3.1. New Fund's acquisition of the Assets in exchange solely for New
Fund Shares and New Fund's assumption of the Liabilities, followed by Old
Fund's distribution of those shares pro rata to the Shareholders
constructively in exchange for the Shareholders' Old Fund Shares, will
constitute a reorganization within the meaning of section 368(a)(1)(F) of
the Code, and each Fund will be "a party to a reorganization" within the
meaning of section 368(b) of the Code;
4.3.2. Old Fund will recognize no gain or loss on the transfer to New
Fund of the Assets in exchange solely for New Fund Shares and New Fund's
assumption of the Liabilities or on the subsequent distribution of those
shares to the Shareholders in constructive exchange for their Old Fund
Shares;
4.3.3. New Fund will recognize no gain or loss on its receipt of the
Assets in exchange solely for New Fund Shares and its assumption of the
Liabilities;
4.3.4. New Fund's basis for the Assets will be the same as the basis
thereof in Old Fund's hands immediately before the Reorganization, and New
Fund's holding period for the Assets will include Old Fund's holding period
therefor;
4.3.5. A Shareholder will recognize no gain or loss on the constructive
exchange of all its Old Fund Shares solely for New Fund Shares pursuant to
the Reorganization;
4.3.6. A Shareholder's aggregate basis for the New Fund Shares to be
received by it in the Reorganization will be the same as the aggregate
basis for its Old Fund Shares to be constructively surrendered in exchange
for those New Fund Shares, and its holding period for those New Fund Shares
will include its holding period for those Old Fund Shares, provided they
are held as capital assets by the Shareholder at the Effective Time; and
4.3.7. For purposes of section 381 of the Code, New Fund will be treated
as if there had been no Reorganization. Accordingly, the Reorganization
will not result in the termination of Old Fund's taxable year, Old Fund's
tax attributes enumerated in section 381(c) of the Code will be taken into
account by New Fund as if there had been no Reorganization, and the part of
Old Fund's taxable year before the Reorganization will be included in New
Fund's taxable year after the Reorganization;
4.4. Prior to the Closing, Corporation's directors shall have authorized the
issuance of, and New Fund shall have issued, one New Fund Share to Trust in
consideration of the payment of $1.00 to vote on the matters referred to in
paragraph 4.5; and
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4.5. Corporation (on behalf of and with respect to New Fund) shall have
entered into a management contract and such other agreements as are necessary
for New Fund's operation as a series of an open-end investment company. Each
such contract and agreement shall have been approved by Corporation's
directors and, to the extent required by law, by such of those directors who
are not "interested persons" thereof (as defined in the 1940 Act) and by Trust
as the sole shareholder of New Fund.
At any time before the Closing, either Investment Company may waive any of
the foregoing conditions (except that set forth in paragraph 4.1) if, in the
judgment of its board, such waiver will not have a material adverse effect on
its Fund's shareholders' interests.
5.BROKERAGE FEES AND EXPENSES
5.1 Each Investment Company represents and warrants to the other that there
are no brokers or finders entitled to receive any payments in connection with
the transactions provided for herein.
5.2 Except as otherwise provided herein, 50% of the total Reorganization
Expenses will be borne by INVESCO Funds Group, Inc. and the remaining 50% will
be borne one-half by each Fund.
6.ENTIRE AGREEMENT; NO SURVIVAL
Neither party has made any representation, warranty, or covenant not set
forth herein, and this Agreement constitutes the entire agreement between the
parties. The representations, warranties, and covenants contained herein or in
any document delivered pursuant hereto or in connection herewith shall not
survive the Closing.
7.TERMINATION
This Agreement may be terminated at any time at or prior to the Effective
Time, whether before or after approval by Old Fund's shareholders:
7.1. By either Fund (a) in the event of the other Fund's material breach of
any representation, warranty, or covenant contained herein to be performed at
or prior to the Effective Time, (b) if a condition to its obligations has not
been met and it reasonably appears that such condition will not or cannot be
met, or (c) if the Closing has not occurred on or before August 31, 1999; or
7.2. By the parties' mutual agreement.
In the event of termination under paragraphs 7.1(c) or 7.2, there shall be
no liability for damages on the part of either Fund, or the trustees/directors
or officers of either Investment Company, to the other Fund.
8.AMENDMENT
This Agreement may be amended, modified, or supplemented at any time,
notwithstanding approval thereof by Old Fund's shareholders, in such manner as
may be mutually agreed upon in writing by the parties; provided that following
such approval no such amendment shall have a material adverse effect on the
Shareholders' interests.
9.MISCELLANEOUS
9.1. This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Maryland; provided that, in the case of any
conflict between such laws and the federal securities laws, the latter shall
govern.
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9.2. Nothing expressed or implied herein is intended or shall be construed
to confer upon or give any person, firm, trust, or corporation other than the
parties and their respective successors and assigns any rights or remedies
under or by reason of this Agreement.
9.3. This Agreement may be executed in one or more counterparts, all of
which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been executed by each Investment
Company and delivered to the other party hereto. The headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
9.4. The execution and delivery of this Agreement have been authorized by
Trust's trustees, and this Agreement has been executed and delivered by
Trust's authorized officers acting as such; neither such authorization by such
trustees nor such execution and delivery by such officers shall be deemed to
have been made by any of them individually or to impose any liability on any
of them or any shareholder of Trust personally, but shall bind only the assets
and property of Old Fund, as provided in Trust's Declaration of Trust.
IN WITNESS WHEREOF, each party has caused this Agreement to be executed and
delivered by its duly authorized officers as of the day and year first written
above.
INVESCO TREASURER'S SERIES TRUST,
on behalf of its series,
INVESCO Treasurer's Money Market
Reserve Fund and
INVESCO Treasurer's Tax-Exempt Fund
By: ___________________________________
President
ATTEST:
____________________________________
Secretary
INVESCO TREASURER'S SERIES FUNDS,
INC.,
on behalf of its series,
INVESCO Treasurer's Money Market
Reserve Fund and
INVESCO Treasurer's Tax-Exempt Fund
By: ___________________________________
President
ATTEST:
____________________________________
Secretary
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APPENDIX C
DIFFERENCES IN LEGAL STRUCTURES
Unless otherwise defined in this Appendix, capitalized terms have the
meanings set forth in the attached Proxy Statement.
DIFFERENCES BETWEEN THE LEGAL STRUCTURES OF A
MARYLAND CORPORATION AND A MASSACHUSETTS BUSINESS TRUST
Treasurer's Series Trust is organized as a Massachusetts business trust. If
Proposal 1 is approved, it will be converted into a Maryland corporation,
INVESCO Treasurer's Series Funds, Inc. This discussion provides a summary of
the material differences between the legal structure of an investment company
organized as a Maryland corporation and subject to the Maryland Statute and an
investment company organized as a Massachusetts business trust under the
Massachusetts Statute. The different legal structures are considered by
contrasting the provisions of the Declaration of Trust and bylaws of
Treasurer's Series Trust (the "Trust") with the corporate charter and By-laws
of Treasurer's Series Funds, Inc., as well as the respective laws applicable
to such entities.
The following is not a complete list of differences. Shareholders should
refer to the provisions of such charters and By-laws ("Governing Documents")
of Treasurer's Series Funds, Inc., the Maryland Statute, the Declaration of
Trust and By-laws of Treasurer's Series Trust and the Massachusetts Statute
directly for a more thorough comparison.
GOVERNING DOCUMENTS.
In order to form a Maryland corporation, one or more individuals over the
age of 18 must sign and acknowledge articles of incorporation which contain
statutorily required provisions and file them for record with the State
Department of Assessments and Taxation of Maryland. The shareholders of a
Maryland corporation are subject to the Maryland Statute and the Governing
Documents of the corporation. The business and affairs of a Maryland
corporation are managed under the direction of its Board of Directors.
In order to be considered a Massachusetts business trust, an entity must
file its trust document with the Secretary of the Commonwealth of
Massachusetts and with the clerk of every city or town in Massachusetts where
the trust has a usual place of business. The business and affairs of a
Massachusetts business trust are governed by its trust instrument, called an
Agreement and Declaration of Trust, as well as its bylaws. The Declaration of
Trust of the Trust is referred to herein as the "Massachusetts Declaration."
SHAREHOLDER VOTING RIGHTS AND MEETINGS.
Shareholders of both a Maryland corporation and a Massachusetts business
trust are subject to the voting requirements contained in the 1940 Act for
electing and removing trustees/directors, selecting auditors and approving
investment advisory agreements and plans of distribution.
The Governing Documents, consistent with the Maryland Statute, provide that
the holder of each share of stock of a New Series is entitled to one vote for
each full share, and a fractional vote for each fractional share of stock,
irrespective of the series or class. The Governing Documents of each New
Series state that, on any matter submitted to a vote of shareholders, all
shares of the corporation then issued and outstanding and entitled to vote,
irrespective
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of series or class, shall be voted in the aggregate and not by series or class
except when (1) otherwise expressly required by the Maryland Statute; (2)
required by the 1940 Act; and (3) the matter does not affect any interest of
the particular series or class, in which circumstance only shareholders of the
affected series or class shall be entitled to vote thereon, unless otherwise
expressly provided in the corporation's charter.
There is no provision in the Massachusetts Statute addressing voting by
beneficial owners. With respect to voting by series or class, the
Massachusetts Declaration is similar to the Governing Documents for each
corresponding New Series. Specifically, such Massachusetts Declaration
provides that each whole share shall be entitled to one vote as to any matter
on which it is entitled to vote and fractional shares shall be entitled to a
proportionate fractional vote. Except with respect to matters as to which the
trustees have determined that only the interests of one or more particular
series or classes are affected or as required by law, all of the shares of
each series or class shall, on matters as to which such series or class is
entitled to vote, vote with the other series or classes so entitled as a
single class. The Massachusetts Declaration specifically provides that the
shareholders of each series must act separately to act upon matters concerning
advisory or management arrangements or investment policies or restrictions
affecting such series.
MATTERS REQUIRING SHAREHOLDER APPROVAL.
Under the Maryland Statute, subject to provision therefor in the charter,
shareholder approval by a majority of all votes entitled to be cast on the
matter is required to approve: (1) amendments of the charter except as
described below; (2) a consolidation, merger, share exchange or transfer of
assets, including a sale of all or substantially all of the assets of the
corporation; (3) a distribution in partial liquidation; or (4) a voluntary
dissolution. Absent such provision, the Maryland Statute requires a
supermajority vote for such actions.
Under the Governing Documents of each New Series, the corporation may take
action upon the concurrence of a majority of the aggregate number of votes
entitled to be cast, even where any provision of Maryland law requires the
vote of a greater proportion of votes entitled to be cast thereon.
The Massachusetts Declaration provides the trustees with a great deal of
latitude as to which matters are to be submitted to a vote of shareholders.
Specifically, shareholders have the power to vote only: (i) for the removal of
trustees by vote of 2/3 of the outstanding shares of the Trust; (ii) to fill a
vacancy on the Board of trustees by affirmative vote of a majority of shares
represented at a special meeting of the shareholders, provided that a quorum
is present and to the extent that a vacancy is not filled by the trustees as
otherwise permitted by the 1940 Act; (iii) for amendments to the Massachusetts
Declaration by vote of not less than a majority of the shares of the Trust;
(iv) on termination of the Trust or any series by vote of not less than 2/3 of
the shares of any such series of the Trust; (v) on any management or advisory
contract to the extent provided by the 1940 Act; (vi) on certain other matters
as may be required by applicable law, the By-laws, or by the Declaration; or
(vii) for the merger, consolidation, sale, lease or exchange of all or
substantially all of the Trust Property by vote of not less than 2/3 of the
shares of each Series. In addition, the Trustees may form an organization to
take over all Trust Property in exchange for the securities of such
organization with approval of the holders of a majority of the shares.
Unlike the Maryland Statute, there is no specific provision under the
Massachusetts Statute with respect to amendments of the Massachusetts
Declaration. Under the Massachusetts Declaration, however, shareholders are
entitled to vote on such amendments as described in the preceding paragraph.
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The Massachusetts Declaration may be amended without obtaining shareholder
approval in order to (i) change the name of the Trust or any series thereof;
(ii) establish and designate any series of shares upon the execution by a
majority of Trustees of an instrument setting forth such designation; and
(iii) abolish any series of shares at any time that there are no shares
outstanding of such series by act of a majority of trustees. The trustees may
also amend the Massachusetts Declaration without the vote or consent of
shareholders at any time if the trustees deem it necessary to conform the
Massachusetts Declaration to applicable laws or regulations. The Governing
Documents include a provision for amendment of the By-laws of the corporation
by the board of directors, except for any provision that is specified not to
be subject to alteration or repeal by the board. Under the Maryland Statute,
the board of directors of an open-end investment company may amend the charter
of such company to change the name of the Fund or the name or other
designation of any classes or series without approval of the shareholders. The
Massachusetts Declaration does not require shareholder approval to change the
name of a Massachusetts Trust or the name or other designation of any classes
or series.
REMOVAL OF DIRECTORS/TRUSTEES.
Unless the charter provides otherwise, the Maryland Statute requires the
affirmative vote of a majority of all votes entitled to be cast for the
election of directors, or to remove a director with or without cause. The
Governing Documents specify that the shareholders may remove any director or
directors by the affirmative vote of the holders of a majority of the votes
entitled to be cast thereon, at any meeting of shareholders duly called and at
which a quorum is present.
The Massachusetts Statute is silent with respect to the removal of trustees
from office. The Massachusetts Declaration provides for the removal of
trustees for cause by action of 2/3 of the remaining trustees, or with or
without cause, by vote of 2/3 of the outstanding shares of the Trust, at any
special meeting of shareholders.
QUORUM REQUIREMENTS.
The Maryland Statute provides that the presence in person or by proxy of the
holders of record of a majority of the outstanding shares of stock entitled to
vote shall constitute a quorum, except as provided otherwise by the charter or
the 1940 Act. The Governing Documents require the presence of 1/3 of the
shares of stock of the corporation entitled to vote, in person or by proxy,
shall constitute a quorum, except that in instances where applicable law
requires approval by one or more classes of stock, the presence of the holders
of 1/3 of the shares of each such class shall constitute a quorum. The By-laws
of each New Series require a greater proportion of shareholders to constitute
a quorum if necessitated by applicable law or the charter. When a quorum is
present, a majority of the shares entitled to vote, in person or by proxy,
shall decide any matter, unless a different vote is required under applicable
law or the Governing Documents. The By-laws of each New Series also provide
that a plurality of all votes cast at a meeting where a quorum is present
shall be sufficient for the election of a director.
The Massachusetts Statute does not contain a provision which defines a
quorum. However, the Massachusetts Declaration and By-laws require the
presence, in person or by proxy, of the holders of a majority of the
outstanding shares of each series in order to constitute a quorum, except as
otherwise provided by applicable laws or otherwise provided in the
Massachusetts Declaration or By-laws of the Trust.
SHAREHOLDERS' MEETINGS.
Under the Maryland Statute, annual shareholders' meetings of a registered
investment company are not required if the charter or bylaws of the company so
provide; however, an annual meeting is required to be held when the 1940
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Act requires the election of directors by shareholders. The Governing
Documents of each New Series are consistent with the Maryland Statute. There
is no provision in the Massachusetts Statute relating to annual shareholders'
meetings, and neither the Massachusetts Declaration nor the By-laws of the
Trust require an annual shareholders' meeting.
With respect to special meetings of shareholders, the bylaws of each New
Series, pursuant to the Maryland Statute, provide that a special meeting may
be called by the president, or, in his absence, a vice president or a majority
of the members of the board of directors or upon the written request of the
holders of at least 10% of all shares issued and outstanding and entitled to
vote at the meeting. There is no comparable provision in the Massachusetts
Statute relating to special meetings of shareholders. The special meeting
requirement under the Massachusetts Declaration is similar to that described
above for each New Series, in that a special meeting of a series may be called
by a majority of the trustees or upon written request of shareholders holding
in the aggregate at least 10% of all outstanding shares of such Series.
ACTION WITHOUT A SHAREHOLDERS' MEETING.
Under the Maryland Statute, any action required to be approved at a meeting
of the shareholders may also be approved by the unanimous written consent of
the shareholders entitled to vote at such meeting.
There is no specific provision in the Massachusetts Statute relating to
shareholder action absent a meeting. Under the Massachusetts Declaration,
however, any action by shareholders that may be taken at a meeting also may be
taken by written action if a majority of the shareholders of each series
entitled to vote on the matter consent in writing and the consents are filed
with the records of shareholders' meetings.
RECORD DATE.
The Maryland Statute requires that the record date for determining which
shareholders are entitled to notice of a meeting, to vote at a meeting, or to
certain other rights, such as the record date for the payment of dividends,
may be not more than 90 days and not less than 10 days before the date on
which the meeting or other action requiring determination will be taken. The
By-laws provide that for the purpose of determining shareholders entitled to
notice of or to vote at any meeting of shareholders or any adjournment
thereof, or shareholders entitled to receive payment of any dividend, or in
order to make a determination of shareholders for any other purpose, the board
of directors of the Corporation may provide that the share transfer books
shall be closed for a stated period by not to exceed, in any case, twenty
days. If the share transfer books shall be closed for the purpose of
determining shareholders entitled to notice of or to vote at a meeting of
shareholders, such books shall be closed for at least ten days immediately
preceding such meeting. In lieu of closing the share transfer books, the board
of directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than
ninety days and, in case of a meeting of shareholders, not less than ten days
prior to the date on which the particular action requiring such determination
of shareholders is to be taken. If the share transfer books are not closed and
no record date is fixed for the determination of shareholders entitled to
notice of or to vote at a meeting of shareholders, the later of the close of
business on the date on which notice of the meeting is mailed or the thirtieth
day before the meeting shall be the record date for determining shareholders
entitled to notice of or to vote at a meeting of shareholders. The record date
for determining shareholders entitled to receive payment of a dividend or an
allotment of any rights shall be the close of business on the day on which the
resolution of the board of directors declaring such dividend or allotment of
rights is adopted. But the payment or allotment may not be made more than 60
days after the date on which the resolution is adopted. When a determination
of shareholders entitled to vote at any meeting of shareholders has been made,
such determination shall apply to any adjournment thereof.
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There is no provision in the Massachusetts Statute regarding record dates
for shareholders entitled to notice of a meeting or to vote at a meeting. The
Massachusetts Declaration permits the trustees from time to time to close the
transfer books for a period not to exceed 30 days or to fix a record date for
making shareholder determinations, which shall not be more than 60 days from
the date of the meeting or other action requiring determination.
NOTICE OF MEETINGS.
The Maryland Statute requires that notice of each shareholders' meeting be
given to each shareholder entitled to vote at the meeting no more than 90 days
and not less than 10 days before a meeting. The By-laws of each New Series are
consistent with this provision.
There is no shareholder meeting notice provision in the Massachusetts
Statute. Under the Massachusetts Declaration, notice of a shareholders'
meeting must be given to shareholders at least 10 days and not more than 60
days before a meeting.
SHAREHOLDER RIGHTS TO INSPECTION.
The Maryland Statute provides that during usual business hours a shareholder
may inspect and copy the following corporate documents: By-laws; minutes of
shareholders' meetings; annual statements of affairs; and voting trust
agreements. Moreover, one or more persons who together are, and for at least
six months have been, shareholders of record of at least five percent of the
outstanding stock of any class are entitled to inspect and copy the
corporation's books of account and stock ledger and to review a statement of
affairs and a list of shareholders.
There is no provision in the Massachusetts Statute relating to the
inspection of trust records by the shareholders. The Massachusetts Declaration
permits inspection by shareholders to the extent permitted to shareholders of
a Massachusetts business corporation.
DIVIDENDS AND OTHER DISTRIBUTIONS.
The Maryland Statute allows the payment of a dividend or other distribution
unless, after giving effect to the dividend or other distribution, (1) the
corporation would not be able to pay its debts as they become due in the usual
course of business or (2) the corporation's total assets would be less than
the corporation's total liabilities plus the amount that would be needed, if
the corporation were to be dissolved at the time of the distribution, to
satisfy the preferential rights upon dissolution of shareholders whose
preferential rights upon dissolution are superior to those receiving the
distribution.
The Massachusetts Statute does not contain any statutory limitations on the
payment of dividends and other distributions. The Massachusetts Declaration
allows the trustees to declare and pay dividends within the board's
discretion.
SHAREHOLDER/BENEFICIAL OWNER LIABILITY.
As a general matter, the shareholders of a Maryland corporation are not
liable for the obligations of the corporation. Under the Maryland Statute, a
shareholder of a Maryland corporation may, however, be liable in the amount of
any distribution he or she accepts knowing that the distribution was made in
violation of the corporation's charter or the Maryland Statute.
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The Massachusetts Statute does not include an express provision relating to
the limitation of liability of the beneficial owners of a business trust. The
beneficial owners of a Massachusetts business trust potentially could be held
personally liable for obligations of the trust. The Massachusetts Declaration
provides, however, that no shareholder shall be subject to any personal
liability to any person in connection with Trust Property or the acts,
obligations or affairs of the Trust or any series thereof.
Therefore, the terms of the Massachusetts Declaration prohibit third parties
from holding a shareholder personally liable for any claim.
DIRECTOR/TRUSTEE LIABILITY.
The standard of conduct for directors of a Maryland corporation is governed
by the Maryland Statute. A director of a Maryland corporation is required to
perform his or her duties in good faith, in a manner that he or she reasonably
believes to be in the best interests of the corporation, and with the care
that an ordinarily prudent person in a like position would use under similar
circumstances. To the extent that a director performs his or her duties as
required, he or she will be protected from liability by reason of having been
a director. Under the Maryland Statute, if it is established that a director
did not perform his or her duties as required by the Maryland Statute, the
director who votes or assents to a distribution made in violation of the
Maryland Statute or the charter may be personally liable to the corporation
for the amount of the distribution that exceeds what could have been made
pursuant to the Maryland Statute or the charter.
The Governing Documents limit the liability of directors to the fullest
extent permitted by Maryland corporate law and the 1940 Act for acts or
omissions which occur while such individual serves as director.
The Massachusetts Statute does not include an express provision limiting the
liability of the trustees of a Massachusetts business trust. The trustees of a
Massachusetts business trust can potentially be held liable for obligations of
the trust. Under the Massachusetts Declaration, no trustee is subject to any
personal liability to any person, except where such liability of the trustee
is to the Trust, any shareholder, trustee, officer, employee or agent and such
liability arises from the bad faith, willful misfeasance, gross negligence or
reckless disregard of the trustee's duties.
INDEMNIFICATION.
There is no provision in the Maryland Statute relating to indemnification of
shareholders. The Governing Documents do not contain provisions relating to
indemnification of shareholders. Generally shareholders of a Maryland
corporation are not liable for the obligations of the corporation.
The Maryland Statute permits indemnification of directors and officers.
Under the Maryland Statute, this right may be limited by the charter or
bylaws. The Governing Documents require indemnification of officers and
directors to the fullest extent permitted by Maryland law and the 1940 Act.
Under the Maryland Statute, indemnification is not permitted if it is
established that: (i) the act or omission of the director was material to the
matter giving rise to the proceeding and was committed in bad faith or was the
result of active and deliberate dishonesty; or (ii) the director received an
improper personal benefit in money, property, or services; or (iii) in the
case of a criminal proceeding, the director had reasonable cause to believe
that the act or omission was unlawful. Under the Maryland Statute, unless the
charter provides otherwise, indemnification against reasonable expenses
incurred by a director is required for a director who is successful, on the
merits or otherwise, in the defense of a proceeding to which he is made a
party by reason of his service in such capacity.
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The Massachusetts Statute does not contain a specific provision addressing
the indemnification of shareholders. The Massachusetts Declaration does,
however, provide that if a shareholder is held personally liable by reason of
a claim or liability incurred by the Trust, the shareholder shall be held
harmless from and indemnified against all claims and liabilities incurred by
the Trust which the shareholder has become subject to and legal and other
expenses reasonably incurred in connection with any such claim or liability.
The shareholders are to be indemnified out of the assets of the particular
series of shares of which the shareholder is or was a shareholder.
The Massachusetts Statute does not contain a specific provision addressing
the indemnification of trustees and officers. Under the Massachusetts
Declaration, however, indemnification of trustees and officers is provided to
the fullest extent permitted by law against liability and against all expenses
reasonably incurred or paid by such trustee in connection with any claim,
action, suit or proceeding. Consistent with the provisions of the 1940 Act,
indemnification is specifically excluded under the Massachusetts Declaration
by reason of a final adjudication of willful misfeasance, bad faith, gross
negligence or reckless disregard of the trustees' duties.
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APPENDIX D
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this 1st day of June, 1999, in Denver, Colorado, by
and between INVESCO FUNDS GROUP, INC. ("Adviser"), a Delaware corporation, and
INVESCO TREASURER'S SERIES FUNDS, INC., a Maryland corporation (the
"Company").
WITNESSETH:
WHEREAS, the Company is a corporation organized under the laws of the State
of Maryland; and
WHEREAS, the "Company" is registered under the Investment Company Act of
1940, as amended (the "Investment Company Act"), as a diversified, open-end
management investment company and has one class of shares (the "Shares") which
is divided into two or more series (the "Series"), each representing an
interest in a separate portfolio of investments (such series initially being
the INVESCO Treasurer's Money Market Reserve Fund and INVESCO Treasurer's Tax-
Exempt Reserve Fund)(individually, the "Fund" and collectively, the "Funds");
and
WHEREAS, the Company desires that the Adviser manages its investment
operations and the Adviser desires to manage said operations;
NOW, THEREFORE, in consideration of these premises and of the mutual
covenants and agreements hereinafter contained, the parties hereto agree as
follows:
1. INVESTMENT MANAGEMENT SERVICES.
The Adviser hereby agrees to manage the investment operations of the Company
and its Funds, subject to the terms of this Agreement and to the supervision
of the Company's directors (the "Directors"). The Adviser agrees to perform,
or arrange for the performance of, the following specific services for the
Company:
(a)to manage the investment and reinvestment of all the assets, now or
hereafter acquired, of the Company and the Funds of the Company;
(b) to maintain a continuous investment program for the Company and each
Fund of the Company, consistent with (i) the Company's and each Fund's in-
vestment policies as set forth in the Company's Registration Statement, as
from time to time amended, under the Investment Company Act of 1940, as
amended (the "1940 Act"), and in any prospectus and/or statement of addi-
tional information of the Company or any Fund of the Company, as from time
to time amended and in use under the Securities Act of 1933, as amended,
and (ii) the Company's status as a regulated investment company under the
Internal Revenue Code of 1986, as amended;
(c) to determine what securities are to be purchased or sold for the
Company and its Funds, unless otherwise directed by the Directors of the
Company, and to execute transactions accordingly;
(d) to provide to the Company and each Fund the benefit of all of the
investment analyses and research, the reviews of current economic condi-
tions and of trends, and the consideration of long-range investment policy
now or hereafter generally available to investment advisory customers of
the Adviser;
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(e) to determine what portion of the Company and each Fund of the Com-
pany should be invested in the various types of securities authorized for
purchase by the Company;
(f) to make recommendations as to the manner in which voting rights,
rights to consent to Company and/or Fund action and any other rights per-
taining to the Company's portfolio securities shall be exercised; and
(g)to calculate the net asset value of the Company and each Fund, as ap-
plicable, as required by the 1940 Act, subject to such procedures as may
be established from time to time by the Company's Directors, based upon
the information provided to the Adviser by the Company or by the custodi-
an, co-custodian or sub-custodian of the Company's or any Fund's assets
(the "Custodian") as designated by the Directors from time to time.
With respect to execution of transactions for the Company and for each Fund,
the Adviser shall place, or arrange for the placement of, all orders for the
purchase or sale of portfolio securities with brokers or dealers selected by
the Adviser. In connection with the selection of such brokers or dealers and
the placing of such orders, the Adviser will at all times attempt to obtain
for the Company and for each Fund, as applicable, the most favorable execution
and price; after fulfilling this primary consideration of obtaining the most
favorable execution and price, the Adviser is hereby expressly authorized to
consider as a secondary factor in selecting brokers or dealers with which such
orders may be placed whether such firms furnish statistical, research and
other information or services to the Adviser. Receipt by the Adviser of any
such statistical or other information and services should not be deemed to
give rise to any requirement for abatement of the advisory fee payable
pursuant to paragraph 4 hereof. The Adviser may follow a policy of considering
sales of shares of the Company as a factor in the selection of broker-dealers
to execute portfolio transactions, subject to the requirements of best
execution discussed above.
At the Company's request, the Adviser will furnish to the Company, at the
expense of the Adviser, such competent executive, administrative and clerical
services as may be required in the judgment of the Directors of the Company.
These services will include, among other things, the maintenance of the
Company's and Funds', as applicable, accounts and records, and the preparation
of all requisite corporate documents such as tax returns and reports to the
Securities and Exchange Commission and Company shareholders. The Adviser will
also furnish, at the Adviser's expense, such office space, equipment and
facilities as may be reasonably requested by the Company from time to time.
The Adviser shall for all purposes herein provided be deemed to be an
independent contractor.
2. ALLOCATION OF COSTS AND EXPENSES
(a)The Adviser hereby agrees that it shall pay on behalf of the Company
and the Funds of the Company all of the expenses incurred by the Company
and the Funds, as applicable, in connection with their operations except
for such transfer agency, subaccounting, recordkeeping, and administrative
services which are to be provided by the Adviser to the Company under sep-
arate Transfer Agent and Administrative Services Agreements between the
Fund and the Adviser which are or have been approved by the Company's
Board of Directors, including all of the independent Directors. At the
Company's request the Adviser shall also furnish to the Company, at the
expense of the Adviser, such competent executive, statistical, administra-
tive, internal accounting and clerical services as may be required in the
judgement of the Directors of the Company. These services will include,
among other things, the maintenance (but not preparation) of the Company's
accounts and records, and the preparation (apart from legal and accounting
costs) of all requisite corporate documents such as tax returns and re-
ports to the Securities and Exchange Commission and Company shareholders.
The Adviser also will furnish, at the Adviser's expense, such office
space, equipment and facilities as may be
D-2
<PAGE>
reasonably requested by the Company from time to time. Without limiting
the generality of the foregoing, such costs and expenses payable by the
Adviser include the following, unless the Company's Board of Directors ap-
proves any of the following costs and expenses being paid directly by the
Funds:
(1) the fees, charges and expenses of any independent public
accountants, custodian, depository, dividend disbursing agent,
dividend reinvestment agent, independent pricing services and legal
counsel for the Company or for any Fund;
(2) the taxes, including franchise, income, issue, transfer, business
license, and other corporate fees payable by the Company or any Fund
to federal, state, county, city, or other governmental agents;
(3) the fees and expenses involved in maintaining the registration and
qualification of the Company and of its shares under laws
administered by the Securities and Exchange Commission or under
other applicable regulatory requirements, including the preparation
and printing of prospectuses and statements of additional
information;
(4) the compensation and expenses of its Directors;
(5) the costs of printing and distributing reports, notices of
shareholders' meetings, proxy statements, dividend notices,
prospectuses, statements of additional information and other
communications to the Company's shareholders, as well as all
expenses of shareholders' meetings and Directors' meetings;
(6) all costs, fees or other expenses arising in connection with the
organization and filing of the Company's Articles of Incorporation
including its initial registration and qualification under the 1940
Act and under the Securities Act of 1933, as amended, the initial
determination of its tax status and any rulings obtained for this
purpose, the initial registration and qualification of its
securities under the laws of any State and the approval of the
Company's operations by any other Federal or State authority;
(7) the expenses of repurchasing and redeeming shares of the Company;
(8) insurance premiums;
(9) the expenses, including fees and disbursements of counsel, in
connection with litigation by or against the Company and any Fund;
and
(10) premiums for the fidelity bond maintained by the Company pursuant
to Section 17(g) of the 1940 Act and rules promulgated thereunder.
(b) Except to the extent required by law to be paid by the Adviser, the
Company shall pay the following costs and expenses:
(1) all brokers' commissions, issue and transfer taxes, and other costs
chargeable to the Company or any Fund in connection with securities
transactions to which the Company or any Fund is a party or in
connection with securities owned by the Company or any Fund; and
(2) the interest on indebtedness, if any, incurred by the Company or any
Fund.
3. USE OF AFFILIATED COMPANIES
In connection with the rendering of the services required to be provided by
the Adviser under this Agreement, the Adviser may, to the extent it deems
appropriate and subject to compliance with the requirements of
D-3
<PAGE>
applicable laws and regulations, and upon receipt of written approval of
the Company, make use of its affiliated companies and their employees,
provided that the Adviser shall supervise and remain fully responsible for
all such services in accordance with and to the extent provided by this
Agreement and that all costs and expenses associated with the providing of
services by any such companies or employees and required by this Agreement
to be borne by the Adviser shall be borne by the Adviser or its affiliated
companies.
4. COMPENSATION OF THE ADVISER
For the services to be rendered and the charges and expenses to be assumed
by the Adviser hereunder, the Company shall pay to the Adviser an advisory fee
which will be computed on a daily basis and paid as of the last day of each
month, using for each daily calculation the most recently determined net asset
value of each Fund of the Company, as determined by valuations made in
accordance with the Company's procedure for calculating each Fund's net asset
value, as described in the Company's prospectus and/or statement of additional
information. On an annual basis, the advisory fee applicable to each of the
Funds shall be as follows:
(a) INVESCO Treasurer's Money Market Reserve Fund: 0.25% of the average net
asset value of such Fund; and
(b) INVESCO Treasurer's Tax-Exempt Reserve Fund: 0.25% of the average net
asset value of such Fund.
During any period when the determination of the Funds' net asset value is
suspended by the Directors of the Company, the net asset value of a share of
the Funds as of the last business day prior to such suspension shall, for the
purpose of this Paragraph 4, be deemed to be the net asset value at the close
of each succeeding business day until it is again determined. However, no such
fee shall be paid to the Adviser with respect to any assets of the Company or
any Fund thereof which may be invested in any other investment company for
which the Adviser serves as investment adviser. The fee provided for hereunder
shall be prorated in any month in which this Agreement is not in effect for
the entire month.
Interest, taxes and extraordinary items such as litigation costs are not
deemed expenses for purposes of this paragraph and shall be borne by the
Company or such Fund in any event. Expenditures, including costs incurred in
connection with the purchase or sale of portfolio securities, which are
capitalized in accordance with generally accepted accounting principles
applicable to investment companies, are accounted for as capital items and
shall not be deemed to be expenses for purposes of this paragraph.
5. AVOIDANCE OF INCONSISTENT POSITIONS AND COMPLIANCE WITH LAWS
In connection with purchases or sales of securities for the investment
portfolio of the Company or of any of the Funds, except as permitted by
section 7 of this agreement, neither the Adviser nor its officers or employees
will act as a principal or agent for any party other than the Company or
applicable Fund or receive any commissions. The Adviser will comply with all
applicable laws in acting hereunder including, without limitation, the 1940
Act; the Investment Advisers Act of 1940, as amended, and all rules and
regulations duly promulgated under the foregoing.
6. DURATION AND TERMINATION
This Agreement shall become effective as of the date it is approved by a
majority of the outstanding voting securities of each applicable Fund of the
Company, and unless sooner terminated as hereinafter provided, shall remain in
force for an initial term of two years from the date of execution and from
year to year thereafter, but only as long
D-4
<PAGE>
as such continuance is specifically approved at least annually (i) by a vote
of a majority of the outstanding voting securities of each applicable Fund of
the Company or by a majority of the Directors of the Company, and (ii) by a
majority of the Directors of the Company who are not interested persons of the
Adviser or the Company by votes cast in person at a meeting called for the
purpose of voting on such approval.
This Agreement may, on 60 days' prior written notice, be terminated without
the payment of any penalty, by the Directors of the Company on behalf of
either of the Funds, or by the vote of a majority of the outstanding voting
securities of the Company or of the applicable Fund (if only one Fund is
terminating this Agreement), as the case may be, or by the Adviser. This
Agreement shall immediately terminate if it is not approved by a vote of the
majority of the outstanding voting securities of each applicable Fund of the
Company at the first meeting of shareholders of the Funds. This Agreement
shall immediately terminate in the event of its assignment, unless an order is
issued by the Securities & Exchange Commission conditionally or
unconditionally exempting such assignment from the provisions of Section 15(a)
of the 1940 Act, in which event this Agreement shall remain in full force and
effect subject to the terms and provisions of said order. In interpreting the
provisions of this paragraph 6, the definitions contained in Section 2(a) of
the 1940 Act (particularly the definitions of "interested person",
"assignment" and "vote of a majority of the outstanding voting securities")
shall be applied.
The Adviser agrees to furnish to the Directors of the Company such
information as may reasonably be necessary to evaluate the terms of this
Agreement.
Termination of this Agreement shall not affect the right of the Adviser to
receive payments on any unpaid balance of the compensation described in
paragraph 4 earned prior to such termination.
7. NON-EXCLUSIVE SERVICES
The Adviser shall, during the term of this Agreement, be entitled to render
investment advisory services to others, including, without limitation, other
investment companies with similar objectives to those of the Company or any
Fund of the Company. The Adviser may, when it deems such to be advisable,
aggregate orders for its other customers together with any securities of the
same type to be sold or purchased for the Company or any Fund in order to
obtain best execution and lower brokerage commissions. In such event, the
Adviser shall allocate the shares so purchased or sold, as well as the
expenses incurred in the transaction, in the manner it considers to be most
equitable and consistent with its fiduciary obligations to the Company, any
applicable Fund and the Adviser's other customers.
8. LIABILITY
The Adviser shall have no liability to the Company or any Fund or to the
Company's shareholders or creditors, for any error of judgment, mistake of
law, or for any loss arising out of any investment, nor for any other act or
omission, in the performance of its obligations to the Company or any
applicable Funds not involving willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations and duties hereunder.
9. MISCELLANEOUS PROVISIONS
Notice. Any notice under this Agreement shall be in writing, addressed and
delivered or mailed, postage prepaid, to the other party at such address as
such other party may designate for the receipt of such notice.
Amendments Hereof. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed
by the Company and the Adviser, and no material amendment of this Agreement
shall be effective until approved by the vote of a majority of the outstanding
voting securities of any Fund as to which such amendment is applicable;
provided, however, that this paragraph shall not prevent any immaterial
amendment(s) to this Agreement, which amendment(s) may be made without
shareholder approval, if such
D-5
<PAGE>
amendment(s) are made with the approval of (1) a majority of the Directors and
(2) a majority of the Directors of the Company who are not interested persons
of the Adviser or the Company.
Severability. Each provision of this Agreement is intended to be severable.
If any provision of this Agreement shall be held illegal or made invalid by a
court decision, statute, rule or otherwise, such illegality or invalidity
shall not affect the validity or enforceability of the remainder of this
Agreement.
Headings. The headings in this Agreement are inserted for convenience and
identification only and are in no way intended to describe, interpret, define
or limit the size, extent or intent of this Agreement or any provision hereof.
Applicable Law. This Agreement shall be construed in accordance with the
laws of the State of Colorado and the applicable provisions of the 1940 Act.
To the extent that the applicable laws of the State of Colorado, or any of the
provisions herein, conflict with applicable provisions of the 1940 Act, the
latter shall control.
IN WITNESS WHEREOF, the Adviser and the Company each has caused this
Agreement to be duly executed on its behalf by an officer thereunto duly
authorized, the day and year first above written.
INVESCO FUNDS GROUP, INC.
By:
-----------------------------------
Ronald L. Grooms
Senior Vice President
ATTEST:
- --------------------------------
Glen A. Payne
Secretary
INVESCO TREASURER'S SERIES FUNDS,
INC.
By:
-----------------------------------
Mark H. Williamson
President
ATTEST:
- --------------------------------
Glen A. Payne
Secretary
D-6
<PAGE>
[Name and Address]
INVESCO TREASURER'S MONEY MARKET RESERVE FUND
INVESCO TREASURER'S SERIES TRUST
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Trustees of INVESCO
Treasurer's Series Trust (the "Trust") and relates to the proposals with respect
to the Trust and to INVESCO Treasurer's Money Market Reserve Fund, a series of
the Trust ("Fund"). The undersigned hereby appoints as proxies Fred A. Deering
and Mark H. Williamson, and each of them (with power of substitution), to vote
all shares of common stock of the undersigned in the Fund at the Special Meeting
of Shareholders to be held at 10:00 a.m., Mountain Standard Time, on May 20,
1999, at the offices of the Trust, 7800 East Union Avenue, Denver, Colorado
80237, and any adjournment thereof ("Meeting"), with all the power the
undersigned would have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Trust and the Fund with discretionary power
to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO TREASURER'S MONEY MARKET RESERVE FUND
INVESCO TREASURER'S SERIES TRUST
<TABLE>
<S> <C> <C> <C>
Vote on Trustees FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
4. Election of the Trust's Board of Trustees: To withhold authority to
(1) Charles W. Brady; (2) Fred A. Deering; (3) vote, mark "For All
Mark H. Williamson; (4) Dr. Victor L. Andrews; Except" and write the
(5) Bob R. Baker; (6) Lawrence H. Budner; (7) nominee's number on the
Dr. Wendy Lee Gramm; (8) Kenneth T. King; (9) line below.
John W. McIntyre; and (10) Dr. Larry Soll;
Vote On Proposals FOR AGAINST ABSTAIN
[ ] [ ] [ ]
1. To approve an Agreement and Plan of Conversion and Termination providing
for the conversion of the Fund from a series of INVESCO Treasurer's Series
Trust, a Massachusetts business trust, into a separate series of INVESCO
Treasurer's Series Funds, Inc., a Maryland corporation;
FOR AGAINST ABSTAIN
ALL ALL ALL
[ ] [ ] [ ]
2. Approval of changes to the fundamental investment restrictions;
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
To vote against the proposed changes to one or more of the specific
fundamental investment restrictions, but to approve others, PLACE AN "X" IN
THE BOX AT LEFT and indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line on the reverse side. If you choose to vote differently
on individual restrictions, you must mail in your proxy card. If you
choose to vote the same on all restrictions pertaining to your fund,
telephone and Internet voting are available.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. To approve the proposed Investment Advisory Agreement with INVESCO Funds
Group, Inc.;
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
5. Ratification of the selection of PricewaterhouseCoopers LLP as the Fund's
Independent Public Accountants.
</TABLE>
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE OR INTERNET, PLEASE DATE
AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
_______________________________________ ________________________
Signature Date
_______________________________________ ________________________
Signature (Joint Owners) Date
[Back]
To vote against the proposed changes to one or more of the specific fundamental
investment restrictions, indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote differently on
individual restrictions, you must mail in your proxy card. If you choose to
vote the same on all restrictions pertaining to your fund, telephone and
Internet voting are available.
2. _______________________________
<PAGE>
[Name and Address]
INVESCO TREASURER'S TAX-EXEMPT RESERVE FUND
INVESCO TREASURER'S SERIES TRUST
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
May 20, 1999
This proxy is being solicited on behalf of the Board of Trustees of INVESCO
Treasurer's Series Trust (the "Trust") and relates to the proposals with respect
to the Trust and to INVESCO Treasurer's Tax-Exempt Reserve Fund, a series of the
Trust ("Fund"). The undersigned hereby appoints as proxies Fred A. Deering and
Mark H. Williamson, and each of them (with power of substitution), to vote all
shares of common stock of the undersigned in the Fund at the Special Meeting of
Shareholders to be held at 10:00 a.m., Mountain Standard Time, on May 20, 1999,
at the offices of the Trust, 7800 East Union Avenue, Denver, Colorado 80237, and
any adjournment thereof ("Meeting"), with all the power the undersigned would
have if personally present.
The shares represented by this proxy will be voted as instructed. Unless
indicated to the contrary, this proxy shall be deemed to grant authority to vote
"FOR" all proposals relating to the Trust and the Fund with discretionary power
to vote upon such other business as may properly come before the Meeting.
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE, FACSIMILE OR INTERNET,
PLEASE DATE AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
[X] KEEP THIS PORTION FOR YOUR RECORDS
<PAGE>
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
INVESCO TREASURER'S TAX-EXEMPT RESERVE FUND
INVESCO TREASURER'S SERIES TRUST
<TABLE>
<S> <C> <C> <C> <C>
Vote on Trustees FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
4. Election of the Trust's Board of Trustees: [ ] [ ] [ ] To withhold authority to
(1) Charles W. Brady; (2) Fred A. Deering; (3) vote, mark "For All
Mark H. Williamson; (4) Dr. Victor L. Andrews; Except" and write the
(5) Bob R. Baker; (6) Lawrence H. Budner; (7) nominee's number on the
Dr. Wendy Lee Gramm; (8) Kenneth T. King; (9) line below.
John W. McIntyre; and (10) Dr. Larry Soll;
Vote On Proposals FOR AGAINST ABSTAIN
[ ] [ ] [ ]
1. To approve an Agreement and Plan of Conversion and Termination providing
for the conversion of the Fund from a series of INVESCO Treasurer's Series
Trust, a Massachusetts business trust, into a separate series of INVESCO
Treasurer's Series Funds, Inc., a Maryland corporation;
FOR AGAINST ABSTAIN
ALL ALL ALL
[ ] [ ] [ ]
2. Approval of changes to the fundamental investment restrictions;
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C>
To vote against the proposed changes to one or more of the specific
fundamental investment restrictions, but to approve others, PLACE AN "X" IN
THE BOX AT LEFT and indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line on the reverse side. If you choose to vote differently
on individual restrictions, you must mail in your proxy card. If you
choose to vote the same on all restrictions pertaining to your fund,
telephone and Internet voting are available.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
3. To approve the proposed Investment Advisory Agreement with INVESCO Funds
Group, Inc.;
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
5. Ratification of the selection of PricewaterhouseCoopers LLP as the Fund's
Independent Public Accountants.
</TABLE>
YOUR VOTE IS IMPORTANT. IF YOU ARE NOT VOTING BY PHONE OR INTERNET, PLEASE DATE
AND SIGN THIS PROXY BELOW AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
TO VOTE BY TOUCH-TONE PHONE OR THE INTERNET, PLEASE CALL 1-800-690-6903 TOLL
FREE OR VISIT HTTP://WWW.PROXYVOTE.COM. TO VOTE BY FACSIMILE TRANSMISSION,
PLEASE FAX YOUR COMPLETED PROXY CARD TO 1-800-733-1885.
Please sign exactly as name appears hereon. If stock is held in the name of
joint owners, each should sign. Attorneys-in-fact, executors, administrators,
etc. should so indicate. If shareholder is a corporation or partnership, please
sign in full corporate or partnership name by authorized person.
____________________________________ ________________________
Signature Date
____________________________________ ________________________
Signature (Joint Owners) Date
[Back]
To vote against the proposed changes to one or more of the specific fundamental
investment restrictions, indicate the letter(s) (as set forth in the proxy
statement) of the investment restriction or restrictions you do not want to
change on the line at the right. If you choose to vote differently on individual
restrictions, you must mail in your proxy card. If you choose to vote the same
on all restrictions pertaining to your fund, telephone and Internet voting are
available.
2. ___________________________________
