<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
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 (S)240.14a-11(c) or (S)240.14a-12
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INVESCO MULTIPLE ASSET FUNDS, INC.
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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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
-----------------------------------
<PAGE>
[LOGO OF INVESCO APPEARS HERE] INVESCO MULTIPLE ASSET FUNDS, INC.
DECEMBER 26, 1996
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Dear INVESCO Multiple Asset Funds Shareholder:
Enclosed is a Proxy Statement for the January 31, 1997 special meeting of
shareholders of INVESCO Balanced Fund and INVESCO Multi-Asset Allocation Fund
(together, the "Funds"), the two series of INVESCO Multiple Asset Funds, Inc.
(the "Company").
As you may have heard, INVESCO PLC ("INVESCO") has entered into an agreement
to merge with A I M Management Group Inc. ("AIM"), under which AIM will become
part of INVESCO. INVESCO is the ultimate parent company of INVESCO Funds
Group, Inc., the investment adviser to the Company; INVESCO Trust Company, the
sub-adviser to INVESCO Balanced Fund; and INVESCO Management & Research, Inc.,
the sub-adviser to INVESCO Multi-Asset Allocation Fund.
As explained more fully in the attached Proxy Statement, at the time the
INVESCO/AIM merger takes effect, the Company's present investment advisory and
sub-advisory contracts will terminate automatically, as a matter of law. Al-
though Company shareholders are not being asked to approve the merger, they
must vote on the necessary new investment advisory and sub-advisory contracts.
Accordingly, to provide continuity of investment advisory services to the Com-
pany, the Board of Directors is asking shareholders to approve the following
proposals:
. All shareholders of the Company will be asked to approve a new invest-
ment advisory agreement for the Company, with the same parties and on
terms substantially identical to the existing investment advisory agree-
ment.
. Shareholders of INVESCO Balanced Fund will be asked to approve a new in-
vestment sub-advisory agreement for that Fund, with the same parties and
on terms substantially identical to the existing investment sub-advisory
agreement.
. Shareholders of INVESCO Multi-Asset Allocation Fund will be asked to ap-
prove a new investment sub-advisory agreement for that Fund, with the
same parties and on terms substantially identical to the existing in-
vestment sub-advisory agreement.
In addition, all shareholders are being asked to elect directors of the Com-
pany and to ratify the selection of Price Waterhouse LLP as the Company's in-
dependent accountants. The accompanying Proxy Statement provides additional
detailed information on these proposals, the INVESCO/AIM merger and the Compa-
ny.
WE ARE REQUIRED BY LAW TO INFORM YOU AS TO CERTAIN DETAILS OF THE TRANSAC-
TION, EVEN THOUGH YOU ARE NOT VOTING TO APPROVE THE MERGER. WHAT IS MOST IM-
PORTANT FOR YOU AS A SHAREHOLDER OF THE FUNDS IS THAT APPROVAL OF THE PROPOS-
ALS LISTED ABOVE WILL IN NO WAY INCREASE THE ADVISORY FEES, SUB-ADVISORY FEES
OR EXPENSES OF THE COMPANY OR THE FUNDS OR CHANGE THE LEVEL, NATURE OR QUALITY
OF SERVICES YOU RECEIVE. EACH OF THESE PROPOSALS HAS BEEN APPROVED BY THE
BOARD OF DIRECTORS OF THE COMPANY, WHICH RECOMMENDS THAT SHAREHOLDERS APPROVE
THEM AS WELL.
9705
<PAGE>
The Board of Directors believes that these proposals are in the best inter-
ests of the shareholders. Therefore, we ask that you read the enclosed materi-
als and vote promptly. Should you have any questions, please feel free to call
our client services representatives at 1-800-646-8372. They will be happy to
answer any questions that you might have.
YOUR VOTE IS IMPORTANT. THE MATTERS WE ARE SUBMITTING FOR YOUR CONSIDERATION
ARE SIGNIFICANT TO THE COMPANY, THE FUNDS AND TO YOU AS A SHAREHOLDER. IF WE
DO NOT RECEIVE SUFFICIENT VOTES TO APPROVE THESE PROPOSALS, WE MAY HAVE TO
SEND ADDITIONAL MAILINGS OR CONDUCT TELEPHONE CANVASSING. THEREFORE, PLEASE
TAKE THE TIME TO READ THE PROXY STATEMENT AND CAST YOUR VOTE ON THE ENCLOSED
PROXY CARD, AND RETURN IT IN THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID ENVE-
LOPE.
Sincerely,
/s/ Dan J. Hesser
Dan J. Hesser
President
INVESCO Multiple Asset Funds, Inc. --
INVESCO Balanced Fund
INVESCO Multi-Asset Allocation Fund
<PAGE>
INVESCO MULTIPLE ASSET FUNDS, INC.
7800 EAST UNION AVENUE
DENVER, COLORADO 80237
================================================================================
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 31, 1997
Notice is hereby given that a special meeting of shareholders (the "Meet-
ing") of INVESCO Balanced Fund (the "Balanced Fund") and INVESCO Multi-Asset
Allocation Fund (the "Multi-Asset Allocation Fund") (together, the "Funds") of
INVESCO Multiple Asset Funds, Inc. (the "Company") will be held at the Denver
Marriott Southeast, 6363 East Hampden Avenue, Denver, Colorado 80222 on Fri-
day, January 31, 1997, at 10:00 a.m., Mountain Standard Time, for the follow-
ing purposes.
1.A. To approve or disapprove a new investment advisory agreement between
the Company and INVESCO Funds Group, Inc. ("IFG"), such agreement to
take effect only if the proposed merger of A I M Management Group
Inc. into a wholly-owned U.S. subsidiary of INVESCO PLC is consum-
mated (the "Merger"). INVESCO PLC is the ultimate parent of IFG.
1.B. FOR SHAREHOLDERS OF THE BALANCED FUND ONLY: To approve or disapprove
a new sub-advisory agreement between IFG and INVESCO Trust Company,
with respect to the Balanced Fund, to take effect only if the Merger
is consummated.
1.C. FOR SHAREHOLDERS OF THE MULTI-ASSET ALLOCATION FUND ONLY: To approve
or disapprove a new sub-advisory agreement between IFG and INVESCO
Management & Research, Inc., with respect to the Multi-Asset Alloca-
tion Fund, to take effect only if the Merger is consummated.
2. To elect eleven directors of the Company.
3. To ratify or reject the selection of Price Waterhouse LLP as indepen-
dent accountants for the Company for the fiscal year ending July 31,
1997.
4. To transact such other business as may properly come before the Meeting
or any adjournment(s) thereof.
None of these proposals is expected to result in any change in the way the
Funds are managed, in the advisory or sub-advisory fees or in the services you
receive as a shareholder.
The board of directors of the Company has fixed the close of business on De-
cember 9, 1996, as the record date for the determination of shareholders enti-
tled to notice of and to vote at the Meeting or any adjournment(s) thereof.
A complete list of shareholders of the Funds entitled to vote at the Meeting
will be available and open to the examination of any shareholder of the Funds
for any purpose germane to the Meeting during ordinary business hours after
December 15, 1996, at the offices of the Company, 7800 East Union Avenue, Den-
ver, Colorado 80237.
You are cordially invited to attend the Meeting. Shareholders who do not ex-
pect to attend the Meeting in person are requested to complete, date and sign
the enclosed form of proxy and return it promptly in the enclosed envelope
that requires NO postage if mailed in the United States. The enclosed proxy is
being solicited on behalf of the board of directors of the Company.
<PAGE>
IMPORTANT
Please mark, sign, date and return the enclosed proxy in the accompanying
envelope as soon as possible in order to ensure a full representation at the
Meeting.
The Meeting will have to be adjourned without conducting any business if
less than one-third of the eligible shares is represented, and the Company
will have to continue to solicit votes until a quorum is obtained. The Meeting
also may be adjourned, if necessary, to continue to solicit votes if less than
the required shareholder vote has been obtained to elect the specified number
of directors and to approve Proposals 1.A., 1.B., 1.C. and 3.
Your vote, then, could be critical in allowing the Company to hold the Meet-
ing as scheduled. By marking, signing, and promptly returning the enclosed
proxy, you may eliminate the need for additional solicitation. Your coopera-
tion is appreciated.
By Order of the Board of Directors,
/s/ Glen A. Payne
Glen A. Payne
Secretary
Denver, Colorado
Dated: December 26, 1996
2
<PAGE>
INVESCO MULTIPLE ASSET FUNDS, INC.
DECEMBER 26, 1996
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INVESCO MULTIPLE ASSET FUNDS, INC.
7800 EAST UNION AVENUE
DENVER, COLORADO 80237
PROXY STATEMENT
FOR SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD JANUARY 31, 1997
INTRODUCTION
The enclosed proxy is being solicited by the board of directors (the "Board"
or the "Directors") of INVESCO Multiple Asset Funds, Inc. (the "Company") on
behalf of INVESCO Balanced Fund (the "Balanced Fund") and INVESCO Multi-Asset
Allocation Fund (the "Multi-Asset Allocation Fund) (together, the "Funds"),
the two series of the Company, for use in connection with the special meeting
of shareholders of the Company (the "Meeting") to be held at 10:00 a.m., Moun-
tain Standard Time, on Friday, January 31, 1997, at the Denver Marriott South-
east, 6363 East Hampden Avenue, Denver, Colorado 80222, and at any adjourn-
ment(s) thereof for the purposes set forth in the foregoing notice. THE
COMPANY'S ANNUAL REPORT, INCLUDING FINANCIAL STATEMENTS OF THE COMPANY FOR THE
FISCAL YEAR ENDED JULY 31, 1996, IS AVAILABLE WITHOUT CHARGE UPON REQUEST FROM
GLEN A. PAYNE, SECRETARY OF THE COMPANY, AT P.O. BOX 173706, DENVER, COLORADO
80217-3706 (TELEPHONE NUMBER 1-800-646-8372). The approximate mailing date of
proxies and this Proxy Statement is December 26, 1996.
The primary purpose of the Meeting is to allow shareholders to consider new
investment advisory and sub-advisory agreements for the Funds. As explained in
more detail below, the existing advisory and sub-advisory agreements for the
Funds will terminate automatically, by operation of law, upon the consummation
of the proposed merger (the "Merger") of A I M Management Group Inc. ("AIM")
and a direct wholly-owned subsidiary of INVESCO PLC ("INVESCO"). Shareholders
are not being asked to approve the Merger; rather, they are being asked to
continue the existing investment advisory relationships for the Funds under
new contracts which would take effect at the time of the Merger. Consummation
of the Merger is conditioned on, among other things, shareholder approval of
the new investment advisory and sub-advisory contracts. The transactions con-
templated by the Merger and the terms of the new investment advisory and sub-
advisory agreements are discussed below.
OTHER THAN THEIR COMMENCEMENT AND EXPIRATION DATES, THE PROPOSED NEW ADVI-
SORY AND SUB-ADVISORY AGREEMENTS ARE IDENTICAL IN FORM AND TERMS TO THE PRES-
ENT AGREEMENTS.
<PAGE>
Therefore:
(1) Shareholders of both Funds are being asked to approve a new investment
advisory agreement (the "Proposed Advisory Agreement") between the
Company and its investment adviser, INVESCO Funds Group, Inc. (the
"Adviser" or "IFG"), to replace the existing agreement between the
Company and the Adviser (the "Current Advisory Agreement");
(2) Shareholders of the Balanced Fund are being asked to approve a new in-
vestment sub-advisory agreement (the "Proposed ITC Agreement") between
IFG and that Fund's sub-adviser, INVESCO Trust Company ("ITC"), to re-
place the existing sub-advisory agreement between IFG and ITC (the
"Current ITC Agreement"); and
(3) Shareholders of the Multi-Asset Allocation Fund are being asked to ap-
prove a new investment sub-advisory agreement (the "Proposed IMR
Agreement") between IFG and that Fund's sub-adviser, INVESCO Manage-
ment & Research, Inc. ("IMR"), to replace the existing sub-advisory
agreement between IFG and IMR (the "Current IMR Agreement").
Elsewhere in this Proxy Statement, the Current ITC Agreement and the Current
IMR Agreement are collectively referred to as the "Current Sub-Advisory Agree-
ments," and, together with the Current Advisory Agreement are collectively re-
ferred to as the "Current Agreements." Similarly, the Proposed ITC Agreement
and the Proposed IMR Agreement are collectively referred to as the "Proposed
Sub-Advisory Agreements," and, together with the Proposed Advisory Agreement,
are collectively referred to as the "Proposed Agreements." Each of ITC and IMR
is referred to as a "Sub-Adviser" and, collectively, as the "Sub-Advisers."
The following factors should be considered by shareholders in determining
whether to approve the Proposed Agreements:
. The Proposed Advisory Agreement and each of the Proposed Sub-Advisory
Agreements were approved by the Directors, including the Independent Di-
rectors (as defined below).
. There will be no change in the investment objectives or policies of the
Funds.
. There will be no increase in the fees payable to the Adviser or to the
Sub-Advisers as a result of the approval and implementation of the Pro-
posed Agreements.
. No significant changes are contemplated in the personnel of the Adviser
who are responsible for the overall supervision of the Company or of
each of the Sub-Advisers who are responsible for managing the invest-
ments of the Funds.
The following table indicates the Funds being solicited with respect to the
proposals being presented at the Meeting:
<TABLE>
<CAPTION>
PROPOSAL FUND
-------- ----
<S> <C>
1.A. Approval of new Advisory Agreement between Both Funds
the Company and IFG
1.B. Approval of new Sub-Advisory Agreement Balanced Fund
between IFG and ITC
1.C. Approval of new Sub-Advisory Agreement Multi-Asset Allocation Fund
between IFG and IMR
2. Election of Directors Both Funds
3. Ratification or Rejection of Independent Both Funds
Accountants
</TABLE>
2
<PAGE>
If the enclosed form of proxy is duly executed and returned in time to be
voted at the Meeting, and not subsequently revoked, all shares represented by
the proxy will be voted in accordance with the instructions marked thereon. If
no instructions are given, such shares will be voted FOR the nominees for di-
rector hereinafter listed and FOR Proposals 1.A., 1.B., 1.C. and 3. One third
of the outstanding shares of the Company entitled to vote, represented in per-
son or by proxy, will constitute a quorum at the Meeting.
Shares held by shareholders present in person or represented by proxy at the
Meeting will be counted both for the purpose of determining the presence of a
quorum and for calculating the votes cast on the issues before the Meeting. An
abstention by a shareholder, either by proxy or by vote in person at the Meet-
ing, has the same effect as a negative vote. Shares held by a broker or other
fiduciary as record owner for the account of the beneficial owner are counted
toward the required quorum if the beneficial owner has executed and timely de-
livered the necessary instructions for the broker to vote the shares or if the
broker has exercised discretionary voting power. Where the broker or fiduciary
does not receive instructions from the beneficial owner and does not have dis-
cretionary voting power as to one or more issues before the Meeting, but
grants a proxy for or votes such shares, they will be counted toward the re-
quired quorum but will have the effect of a negative vote on any proposals on
which it does not vote.
Because certain of the proposals being submitted for a vote of the share-
holders of each Fund are identical, the Board determined to combine the proxy
materials for the Funds in order to reduce the cost of preparing, printing and
mailing the proxy materials.
In order to further reduce costs, the notices to shareholders 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
each shareholder's votes will be counted for all such accounts.
Execution of the enclosed proxy card will not affect a shareholder's right
to attend the Meeting and vote in person, and a shareholder giving a proxy has
the power to revoke it (by written notice to the Company at P.O. Box 173706,
Denver, Colorado 80217-3706, execution of a subsequent proxy card, or oral
revocation at the Meeting) at any time before it is exercised.
Shareholders of the Funds of record at the close of business on December 9,
1996 (the "Record Date"), are entitled to vote at the Meeting, including any
adjournment(s) thereof, and are entitled to one vote for each share, and cor-
responding fractional votes for fractional shares, on each matter to be acted
upon at the Meeting. On the Record Date, 10,078,464 shares of the Company's
common stock, $.01 par value per share were outstanding, including 9,260,228
shares of the Balanced Fund and 818,236 shares of the Multi-Asset Allocation
Fund.
The following table sets forth, as of the Record Date, the beneficial owner-
ship of each Fund's issued and outstanding common stock by each 5% or greater
shareholder. The Directors and executive officers of the Company did not own
1% or more of the outstanding Fund shares as of the Record Date.
<TABLE>
<CAPTION>
Name and Address Amount of Percent of
of Beneficial Owner Beneficial Ownership(1) Common Stock
- ------------------- ----------------------- ------------
<S> <C> <C>
BALANCED FUND
Charles Schwab & Co., Inc. 1,948,586.4800 21.044%
Special Custody Account for
the
Exclusive Benefit of
Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Name and Address Amount of Percent of
of Beneficial Owner Beneficial Ownership(1) Common Stock
- ------------------- ----------------------- ------------
<S> <C> <C>
MULTI-ASSET ALLOCATION FUND
Charles Schwab & Co., Inc. 236,098.5460 29.150%
Special Custody Account for
the
Exclusive Benefit of
Customers
Attn: Mutual Funds
101 Montgomery Street
San Francisco, CA 94104
Richard L. Mitchell & 102,655.2390 12.674%
John M. Rilla, Co-Trustees
Koehler Manufacturing
Retirement Income Plan
123 Felton Street
Marlborough, MA 01752
</TABLE>
(1) Each beneficial owner named above shares investment power with respect
to the shares listed next to its respective row, but its customers re-
tain sole voting power.
In addition to the solicitations of proxies by use of the mail, proxies may
be solicited by officers of the Company, and by officers and employees of IFG,
personally or by telephone or telegraph, without special compensation. In ad-
dition, Shareholder Communications Corporation ("SCC") will be retained to as-
sist in the solicitation of proxies.
As the meeting date approaches, certain shareholders whose votes the Company
has not yet received may receive telephone calls from representatives of SCC
requesting that they authorize, by telephonic or electronically transmitted
instructions, SCC to execute proxy cards on their behalf. Telephone authoriza-
tions will be recorded in accordance with the procedures set forth below. The
Adviser believes that these procedures are reasonably designed to ensure that
the identity of the shareholder casting the vote is accurately determined and
that the voting instructions of the shareholder are accurately determined.
SCC has received an opinion of Maryland counsel that addresses the validity,
under the applicable laws of the State of Maryland, of authorization given
orally to execute a proxy. The opinion given by Maryland counsel concludes
that a Maryland court would find that there is no Maryland law or public pol-
icy against the acceptance of proxies signed by an orally-authorized agent,
provided it adheres to the procedures set forth below.
In all cases where a telephonic proxy is solicited, the SCC representative
is required to ask the shareholder for such shareholder's full name, address,
social security or employer identification number, title (if the person giving
the proxy is authorized to act on behalf of an entity, such as a corporation),
and the number of shares owned, and to confirm that the shareholder has re-
ceived the Proxy Statement in the mail. If the information solicited agrees
with the information provided to SCC by the Company, the SCC representative
has the responsibility to explain the process, read the proposals listed on
the proxy card, and ask for the shareholder's instructions on each proposal.
Although he or she is permitted to answer questions about the process, the SCC
representative is not permitted to recommend to the shareholder how to vote,
other than to read any recommendation set forth in the Proxy Statement. SCC
will record the shareholder's instructions on the card. Within 72 hours, SCC
will send the shareholder a letter or mailgram confirming the shareholder's
vote and asking the shareholder to call SCC immediately if the shareholder's
instructions are not correctly reflected in the confirmation.
4
<PAGE>
If a shareholder wishes to participate in the Meeting, but does not wish to
give a proxy by telephone, such shareholder may still submit the proxy card
originally sent with the Proxy Statement or attend in person. Any proxy given
by a shareholder, whether in writing or by telephone, is revocable. A share-
holder may revoke the accompanying proxy or a proxy given telephonically at
any time prior to its use by filing with the Company a written revocation or
duly executed proxy bearing a later date. In addition, any shareholder who at-
tends the Meeting in person may vote by ballot at the Meeting, thereby cancel-
ing any proxy previously given.
All costs of printing and mailing proxy materials and the costs and expenses
of holding the Meeting and soliciting proxies, including any amount paid to
SCC, will be paid by INVESCO and not by the Company, the Funds or their share-
holders.
The Board may seek one or more adjournments of the Meeting to solicit addi-
tional shareholders, if necessary, to obtain a quorum for the Meeting, or to
obtain the required shareholder vote to elect the number of specified direc-
tors and approve Proposals 1.A., 1.B., 1.C. and 3. An adjournment would re-
quire the affirmative vote of the holders of a majority of the shares present
at the Meeting (or an adjournment thereof) in person or by proxy and entitled
to vote. If adjournment is proposed in order to obtain the required share-
holder vote on a particular proposal, the persons named as proxies will vote
in favor of adjournment those shares which they are entitled to vote in favor
of such proposal and will vote against adjournment those shares which they are
required to vote against such proposal. A shareholder vote may be taken on one
or more of the proposals discussed herein prior to any such adjournment if
sufficient votes have been received and it is otherwise appropriate.
PROPOSAL 1: A. APPROVAL OF THE PROPOSED ADVISORY AGREEMENT BETWEEN THE COM-
PANY AND INVESCO FUNDS GROUP, INC.
B. WITH RESPECT TO THE BALANCED FUND, APPROVAL OF THE PROPOSED
SUB-ADVISORY AGREEMENT BETWEEN INVESCO FUNDS GROUP, INC. AND
INVESCO TRUST COMPANY
C. WITH RESPECT TO THE MULTI-ASSET ALLOCATION FUND, APPROVAL OF
THE PROPOSED SUB-ADVISORY AGREEMENT BETWEEN INVESCO FUNDS
GROUP, INC. AND INVESCO MANAGEMENT & RESEARCH, INC.
BACKGROUND
IFG serves as investment adviser to the Company pursuant to the Current Ad-
visory Agreement. The Current Advisory Agreement provides that the Adviser,
upon receipt of written approval of the Company, is authorized to retain com-
panies to provide investment advisory services to the Company. Accordingly,
IFG has entered into a sub-advisory agreement with ITC, pursuant to which ITC
serves as sub-adviser to, and is primarily responsible for, managing the in-
vestments of the Company's Balanced Fund. IFG also has entered into a sub-ad-
visory agreement with IMR, pursuant to which IMR serves as sub-adviser to, and
is primarily responsible for, managing the investments of the Company's Multi-
Asset Allocation Fund. ITC is a wholly-owned subsidiary of the Adviser. Both
the Adviser and the Sub-Adviser are indirect, wholly-owned subsidiaries of
INVESCO. INVESCO is a publicly traded holding company organized under the laws
of England in 1935. The ordinary shares of INVESCO, 25 pence nominal value per
share (the "Ordinary Shares"), are traded on the London Stock Exchange.
INVESCO's subsidiaries provide investment advisory services throughout the
world. As of September 30, 1996, the total assets advised by INVESCO and its
subsidiaries were approximately $91.1 billion.
5
<PAGE>
AIM is a holding company that has been engaged in the financial services
business since 1976 and, together with its affiliates, advises or manages 38
investment company portfolios comprising the A I M Family of Funds(R). As of
October 31, 1996, the total assets of the registered investment company port-
folios advised or managed by AIM and its affiliates were approximately $57
billion.
On November 4, 1996, INVESCO and INVESCO Group Services, Inc. ("IGS") en-
tered into an agreement of merger (the "Merger Agreement") with AIM pursuant
to which IGS or another wholly-owned U.S. subsidiary of INVESCO ("INVESCO
Sub") will acquire all the issued and outstanding shares of AIM capital stock
for consideration valued on November 4, 1996 at approximately $1.6 billion,
plus the amount of AIM net income from September 1, 1996 through the date on
which the Merger is consummated (the "Closing Date"), minus dividends paid
during such period and subject to adjustments for certain balance sheet items
and transaction expenses. The consideration will include 290 million new Ordi-
nary Shares (including Ordinary Shares issuable in respect of vested and
unvested AIM options) of INVESCO valued on November 4, 1996 at approximately
$1.1 billion. The balance of the consideration will be paid in cash. Upon con-
summation of the Merger, the AIM shareholders will own approximately 45% of
INVESCO's total outstanding capital stock on a fully-diluted basis. Thereaf-
ter, INVESCO will change its name to "AMVESCO PLC" (the names of the Adviser
and the Sub-Advisers will not change).
The Closing Date is presently expected to occur on or about February 28,
1997, subject to the satisfaction of conditions to closing that include, among
other things: (a) INVESCO having consummated one or more financings and having
received net proceeds of not less than $500 million; (b) the respective aggre-
gate annualized asset management fees of INVESCO and AIM (based on assets un-
der management, excluding the effects of market movements), in respect of
which consents to the Merger have been obtained being equal to or greater than
87.5% of all such fees; (c) INVESCO and AIM having received certain consents
from regulators, lenders and/or other third parties; (d) AIM not having re-
ceived from the holder or holders of more than 2% of the outstanding AIM
shares notices that they intend to exercise dissenters' rights; (e) a Voting
Agreement, Standstill Agreement, Transfer Restriction Agreements, Transfer Ad-
ministration Agreement, Registration Rights Agreement, Indemnification Agree-
ment and employment agreements with approximately thirty AIM employees having
been executed and delivered; (f) AIM having received an opinion from its U.S.
counsel that the Merger will be treated as a tax-free reorganization; and (g)
shareholder resolutions to appoint to INVESCO's board of directors (the
"INVESCO Board") six AIM designees and a resolution of the INVESCO Board to
appoint the seventh AIM designee having been passed and not revoked.
The Merger Agreement may be terminated at any time prior to the Closing Date
by written notice by AIM or INVESCO to the other after June 1, 1997 or under
other circumstances set forth in the Merger Agreement. In certain circum-
stances occurring on or before September 30, 1997, a termination fee will be
payable by the party in respect of which such circumstances have occurred.
In connection with the Merger, the following agreements, each to be effec-
tive upon the closing of the Merger, have been or will be executed:
Voting Agreement. Certain AIM shareholders and their spouses, the cur-
rent directors of INVESCO and proposed directors of INVESCO (expected to
hold in the aggregate approximately 25% of the Ordinary Shares of INVESCO
outstanding immediately following consummation of the Merger) have agreed
to vote as directors and as shareholders to ensure that: (a) the INVESCO
Board will have fifteen members, consisting of four executive directors
and three non-executive directors designated by INVESCO's current senior
management, four executive directors and three non-executive directors
designated by AIM's current senior management and a Chairman; (b) the ini-
tial Chairman will be Charles W. Brady
6
<PAGE>
(INVESCO's current Chairman) and the initial Vice Chairman will be Charles
T. Bauer (AIM's current Chairman); and (c) the parties will vote at any
INVESCO shareholder meetings on resolutions (other than those in respect
of the election of directors) supported by two-thirds of the INVESCO Board
in the same proportion as votes are cast by unaffiliated shareholders. The
Voting Agreement will terminate on the earlier of the fourth anniversary
of the Closing Date or the date on which a resolution proposed by an
INVESCO-designated board member is approved by the INVESCO Board despite
being voted against by each AIM-designated board member present at such
INVESCO Board meeting.
Standstill Agreement and Transfer Restriction Agreements. Certain AIM
shareholders and their spouses and certain significant shareholders of
INVESCO have agreed, under certain circumstances for a maximum period of
five years, not to engage in a number of specified activities that might
result in a change of the ownership or control positions of INVESCO exist-
ing as of the Closing Date. AIM shareholders and INVESCO's current Chair-
man will be restricted in their ability to transfer their shares of
INVESCO for a period of up to five years.
If the conditions to the Merger are not met or waived, or if the Merger
Agreement is terminated, the Merger will not be consummated and the Current
Agreements will remain in effect. If the Proposed Agreements are approved and
the Merger is thereafter consummated, the Proposed Agreements will be executed
and become effective on the Closing Date. In the event the Merger is consum-
mated and: (i) the Proposed Advisory Agreement is not approved by both Funds,
the Proposed Advisory Agreement will be approved as to the Fund that voted in
favor of the Proposed Advisory Agreement and the Board will determine what ac-
tion to take as to the other Fund; (ii) either the Proposed ITC Agreement or
the Proposed IMR Agreement is not approved, the Board will determine what ac-
tion to take. In each of the above instances, any such action taken by the
Board will be subject to the approval of the appropriate shareholders.
Under the Merger Agreement, INVESCO and INVESCO Sub have agreed that they
will comply, and use all reasonable efforts to cause compliance on behalf of
their affiliates, with the provisions of Section 15(f) of the Investment Com-
pany Act of 1940, as amended (the "1940 Act"). Section 15(f) provides, in per-
tinent part, that an investment adviser of an investment company and its af-
filiates may receive any amount or benefit in connection with a sale of secu-
rities of, or a sale of any other interest in, such investment adviser that
results in an "assignment" of an investment advisory contract as long as two
conditions are met. First, no "unfair burden" may be imposed on the investment
company as a result of the Merger. The term "unfair burden," as defined in the
1940 Act, includes any arrangement during the two-year period after the trans-
action whereby the investment adviser (or predecessor or successor investment
adviser) or any interested person of any such adviser receives or is entitled
to receive any compensation directly or indirectly from the investment company
or its security holders (other than fees for bona fide investment advisory or
other services) or from any person in connection with the purchase or sale of
securities or other property to, from, or on behalf of the investment company
(other than fees for bona fide principal underwriting services). No such com-
pensation arrangements are contemplated in connection with the Merger.
The second condition is that, for a period of three years after the transac-
tion occurs, at least 75% of the members of the board of directors of the in-
vestment company advised by such adviser are not "interested persons" (as de-
fined in the 1940 Act) of the new or the old investment adviser. The Board you
are being asked to elect in Proposal No. 2 below does not meet this 75% re-
quirement. Nevertheless, as more fully described below under Proposal No. 2,
the composition of the Board, on or prior to the date the Merger is effected,
will comply with the 75% requirement.
INVESCO has advised the Company that the Merger is not expected to have a
material effect on the operations of the Company, on the Funds or on their
shareholders. No material change in investment philosophy,
7
<PAGE>
policies or strategies is currently envisioned. The Adviser and the Sub-Advis-
ers will, following the Merger, continue to be indirect wholly-owned subsidi-
aries of INVESCO. The Merger Agreement does not, by its terms, contemplate any
changes, other than changes in the ordinary course of business, in the manage-
ment or operation of the Adviser or the Sub-Advisers relating to the Company
and its Funds, the personnel managing the Funds, or other services provided to
or other business activities of the Company. The Merger also is not expected
to result in material changes in the business, corporate structure or composi-
tion of the senior management or personnel of the Adviser or the Sub-Advisers.
Based on the foregoing, the Adviser does not anticipate that the Merger will
cause a reduction in the quality of services now being provided to the Compa-
ny, or have any adverse effect on the Adviser's or a Sub-Adviser's ability to
fulfill its respective obligations under the Proposed Agreements or to operate
its business in a manner consistent with its current practices.
Each of the Current Agreements, as required by Section 15 of the 1940 Act,
provides for its automatic termination in the event of its assignment. Any
change of control of the Adviser and/or the Sub-Advisers is deemed to be an
assignment. Because INVESCO Ordinary Shares constituting more than 25% of the
outstanding voting securities of INVESCO will be issued to the shareholders of
AIM, as a result of the Merger there may be deemed to be a change in control
of INVESCO. Such a change in control would cause an automatic termination of
the Current Advisory Agreement, the Current ITC Agreement and the Current IMR
Agreement under the 1940 Act.
Accordingly, in anticipation of the consummation of the Merger and in order
to ensure continuity of investment advisory services to the Company by the Ad-
viser and to the Balanced Fund and the Multi-Asset Allocation Fund by ITC and
IMR, respectively, a new investment advisory agreement between the Company and
IFG is proposed to be approved by shareholders of each of the Funds. In addi-
tion, it is proposed that: shareholders of the Balanced Fund approve a new
sub-advisory agreement between IFG and ITC and shareholders of the Multi-Asset
Allocation Fund approve a new sub-advisory agreement between IFG and IMR.
The Board, including a majority of those Directors who are not "interested
persons" of the Company as such term is defined under the 1940 Act (the "Inde-
pendent Directors"), has approved the Proposed Advisory Agreement and the Pro-
posed Sub-Advisory Agreements.
EVALUATION OF THE BOARD OF DIRECTORS
At regular or special meetings of the Independent Directors and of the Board
held on October 14, 15, 28, and 30 and on November 6, 1996, at each of which a
majority of the Independent Directors were in attendance, the Directors evalu-
ated the Proposed Advisory Agreement and each of the Proposed Sub-Advisory
Agreements. The Independent Directors had available to them the assistance of
outside counsel throughout the process of determining whether to approve the
Proposed Agreements. Prior to and during the meetings, the Independent Direc-
tors requested and received all information they deemed necessary to enable
them to determine whether each of the Proposed Agreements is in the best in-
terests of the Company, the Funds and their shareholders. At the meetings, the
Independent Directors reviewed materials furnished by Fund management and met
with representatives of INVESCO and with representatives of AIM. They noted
that senior members of the management team of the Adviser will continue to be
responsible for managing the day-to-day affairs of the Adviser and senior man-
agement members of each of the Sub-Advisers will continue to be responsible
for managing the affairs of those companies. In evaluating the effects of the
Merger, the Independent Directors viewed as significant the fact that the Ad-
viser and the Sub-Advisers are expected to continue to provide to the Company,
the Funds and their shareholders, after the Merger, investment advisory serv-
ices of the same nature and quality as before the Merger. Also, the Indepen-
dent Directors considered the possible effects of the Merger on the Company
and its Funds.
8
<PAGE>
The Board considered the nature, quality and extent of services provided and
expected to be provided by the Adviser to the Company, by ITC to the Balanced
Fund and by IMR to the Multi-Asset Allocation Fund as well as the benefits de-
rived by the Adviser, ITC and IMR. In addition, the Board discussed and re-
viewed the terms and provisions of the Proposed Advisory Agreement and the
Proposed Sub-Advisory Agreements. The Board specifically noted that, other
than the dates of execution, effectiveness and termination, the terms of each
of the Proposed Agreements are the same, in all material respects, as the
terms of the corresponding Current Agreements. Specifically, the Board noted
that the fees and expenses payable under each of the Proposed Agreements are
identical to the fees and expenses presently in effect under the corresponding
Current Agreements.
The Board also took note of the terms of the Merger Agreement and the effect
of the addition of the substantial resources of AIM and its affiliated compa-
nies to the INVESCO group, including the reputation, experience, personnel,
resources, financial condition and performance of A I M Advisors, Inc. The
Board considered the statements made by representatives of INVESCO and AIM
that the capabilities of the Adviser and the Sub-Advisers would not be ad-
versely affected by the Merger and could be enhanced by the resources of AIM,
although there was no assurance of the Adviser or Sub-Advisers obtaining any
particular benefits.
Based upon the Directors' review and the evaluations of the materials they
received, and in consideration of all factors deemed relevant to them, the Di-
rectors determined that each of the Proposed Agreements is fair, reasonable
and in the best interests of the Company, the Funds and their shareholders.
ACCORDINGLY, THE BOARD, INCLUDING ALL OF THE INDEPENDENT DIRECTORS PRESENT AT
THE APPLICABLE MEETING, APPROVED EACH OF THE PROPOSED AGREEMENTS AND VOTED TO
RECOMMEND THAT ALL OF THE COMPANY'S SHAREHOLDERS VOTE TO APPROVE THE PROPOSED
ADVISORY AGREEMENT, THAT SHAREHOLDERS OF THE BALANCED FUND VOTE TO APPROVE THE
PROPOSED ITC AGREEMENT AND THAT SHAREHOLDERS OF THE MULTI-ASSET ALLOCATION
FUND VOTE TO APPROVE THE PROPOSED IMR AGREEMENT.
THE PROPOSED ADVISORY AND SUB-ADVISORY AGREEMENTS
If shareholders of each Fund approve the Proposed Advisory Agreement and
shareholders of each of the Balanced Fund and the Multi-Asset Allocation Fund
approve the Proposed ITC Agreement and the Proposed IMR Agreement, respective-
ly, the Proposed Agreements will become effective immediately after the clos-
ing of the Merger. This summary of the Proposed Agreements is qualified in its
entirety by reference to the form of such agreements attached to this Proxy
Statement as Exhibits A.1., A.2. and A.3.
Each of the Proposed Agreements will remain in effect, unless earlier termi-
nated, for an initial term expiring two years from the Closing Date. As previ-
ously discussed, the sole purpose of entering into the Proposed Advisory
Agreement and each of the Proposed Sub-Advisory Agreements is to enable IFG to
continue to serve as the investment adviser to the Company and to enable ITC
and IMR to continue to serve as sub-advisers to the Balanced Fund and the Mul-
ti-Asset Allocation Fund, respectively, after termination of each of the Cur-
rent Agreements by virtue of the "assignment" of such agreements that could
result from the Merger. THE MATERIAL TERMS AND PROVISIONS OF EACH OF THE PRO-
POSED AGREEMENTS, OTHER THAN THEIR RESPECTIVE EFFECTIVE AND TERMINATION DATES,
ARE THE SAME, IN ALL SUBSTANTIVE RESPECTS, AS THOSE OF THE CORRESPONDING CUR-
RENT AGREEMENTS, EACH OF WHICH IS SUMMARIZED BELOW.
THE CURRENT ADVISORY AGREEMENT
The Current Advisory Agreement, dated April 30, 1993, was unanimously ap-
proved on October 20, 1993, by a vote cast in person by a majority of the
Company's Directors, including a majority of the Independent Directors. On No-
vember 19, 1993, such agreement was approved by IFG, as the then sole share-
holder of the
9
<PAGE>
Company, for an initial term expiring on April 30, 1995. The continuation of
the Current Advisory Agreement until April 30, 1997, was approved by the Di-
rectors, including a majority of the Independent Directors, at a meeting of
the Directors held on April 30, 1996, called for the purpose of approving the
Current Advisory Agreement.
The Current Advisory Agreement may be continued from year to year as to each
Fund as long as each such continuance is approved at least annually by the
Board, or by a vote of the holders of a majority of the then-outstanding vot-
ing securities (as defined below under "Vote Required") of the Funds. Any such
continuance also must be approved by a majority of the Independent Directors
of the Company at a meeting called for the purpose of voting on such continu-
ance. Upon sixty (60) days' written notice, the Current Advisory Agreement may
be terminated at any time without penalty by the Board or by a majority of the
then-outstanding voting securities of the Company or, with respect to a par-
ticular Fund, by a majority of the then-outstanding voting securities of that
Fund, or by IFG. As discussed earlier, the Current Advisory Agreement termi-
nates automatically in the event of its "assignment" under the 1940 Act.
The Current Advisory Agreement provides that the Adviser shall (either di-
rectly or by delegation to a sub-adviser) maintain a continuous investment
program for the Company and each of the Funds that is consistent with the
Company's and the Funds' respective investment objectives and policies as set
forth in (i) the Company's registration statement (the "Registration State-
ment") and prospectuses and statements of additional information of each of
the Funds (the "Prospectus" and the "SAI") as in effect from time to time un-
der the 1940 Act and the Securities Act of 1933, as amended. In the perfor-
mance of such duties, the Adviser shall, among other things: (i) manage the
investment and reinvestment of the assets of the Company and the Funds; (ii)
determine what securities are to be purchased or sold for the Company and the
Funds and place, or arrange for the placement of, all orders for such transac-
tions; (iii) furnish the Company 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' portfolio securities should be
exercised; (v) calculate the net asset value of each Fund as required by the
1940 Act; (vi) furnish requisite office space, equipment and facilities as may
reasonably be requested by the Company from time to time; and (vii) maintain
the Company's accounts and records and prepare all requisite corporate docu-
ments such as tax returns and reports to the Securities and Exchange Commis-
sion. Except to the extent assumed by IFG under the Current Advisory Agreement
or required by law, expenses incurred in connection with the operations and
organization of the Funds are borne by the Funds.
As full compensation for its advisory services to the Company, IFG receives
a monthly fee. The fee is based upon a percentage of each Fund's average net
assets, determined daily. With respect to the Balanced Fund, the fee is calcu-
lated at the annual rate of: 0.60% of the first $350 million of the Fund's av-
erage net assets; 0.55% of the next $350 million of the Fund's average net as-
sets; and 0.50% of the Fund's average net assets over $700 million. With re-
spect to the Multi-Asset Allocation Fund, the fee is calculated at the annual
rate of: 0.75% of the first $500 million of the Fund's average net assets;
0.65% of the next $500 million of the Fund's average net assets; and 0.50% of
the Fund's average net assets over $1 billion.
For the fiscal year ended July 31, 1996, the Balanced Fund and the Multi-As-
set Allocation Fund each paid to IFG total advisory fees of $561,473 and
$69,539, respectively. The net assets of each Fund totaled $115,065,851 and
$9,573,580, respectively, at July 31, 1996.
The Current Advisory Agreement provides that IFG shall not be liable for any
error of judgment, mistake of law or for any loss arising out of any invest-
ment, or for any other act or omission in the performance of its obligations
under the Current Advisory Agreement not involving willful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations under such
Agreement.
10
<PAGE>
THE CURRENT SUB-ADVISORY AGREEMENTS
Each of the Current Sub-Advisory Agreements is dated, and was unanimously
approved on, October 20, 1993 by a majority of the Directors, including a ma-
jority of the Independent Directors. On November 19, 1993, IFG, the then sole
shareholder of the Company, approved each of the Current Sub-Advisory Agree-
ments for an initial term expiring on April 30, 1995. The continuation of the
Current Sub-Advisory Agreements until April 30, 1997, was approved by the Di-
rectors, including a majority of the Independent Directors, at a meeting of
the Directors held on April 30, 1996, called for the purpose of approving the
Current Sub-Advisory Agreements.
Each of the Current ITC Agreement and the Current IMR Agreement may be ter-
minated at any time without penalty by IFG, the Board, a vote of a majority of
the then-outstanding voting securities of the respective Fund or by ITC in the
case of the Balanced Fund or IMR in the case of the Multi-Asset Allocation
Fund. Termination by IFG or a Sub-Adviser requires sixty (60) days' written
notice to the other party and to the Company.
Each of the Current Sub-Advisory Agreements provides, as applicable, that
ITC, as sub-adviser to the Balanced Fund, and IMR, as sub-adviser to the Mul-
ti-Asset Allocation Fund, subject to the supervision of IFG and the Board,
shall maintain a continuous investment program for the Balanced Fund and the
Multi-Asset Allocation Fund, respectively, that is consistent with each Fund's
respective investment objectives and policies as set forth in the Company's
Registration Statement and in the Fund's Prospectus and SAI. In the perfor-
mance of such duties, each Sub-Adviser is obligated to provide the Fund it
sub-advises with the same services as those set forth above in clauses (i)
through (iv) with respect to the services provided to the Company and the
Funds by the Adviser.
The Current ITC Agreement provides that as compensation for its services,
ITC shall receive from IFG, at the end of each month, a fee based upon the
Balanced Fund's average net assets, determined daily. Specifically, the fee is
calculated at the annual rate of: 0.30% of the first $350 million of the Bal-
anced Fund's average net assets; 0.275% of the next $350 million of the Bal-
anced Fund's average net assets; and 0.25% of the Balanced Fund's average net
assets over $700 million.
The Current IMR Agreement provides that as compensation for its services,
IMR shall receive from IFG, at the end of each month, a fee based upon Multi-
Asset Allocation Fund's average net assets, determined daily. Specifically,
the fee is calculated at the annual rate of: 0.375% of the first $500 million
of the Fund's average net assets; 0.325% of the next $500 million of the
Fund's average daily net assets; and 0.25% of the Fund's average net assets
over $1 billion.
With respect to each of the Current Sub-Advisory Agreements, the sub-advi-
sory fees are paid by IFG, and not by the Funds or their shareholders.
Under the Current ITC Agreement and the Current IMR Agreement, neither of
the Sub-Advisers shall be liable for any error of judgment, mistake of law or
for any loss arising out of any investment, any act or omission in the perfor-
mance of sub-advisory services rendered with respect to the Company or to the
Balanced Fund in the case of ITC and to the Multi-Asset Allocation Fund in the
case of IMR, except for willful misfeasance, bad faith, gross negligence or
reckless disregard of its duties under such agreements.
INFORMATION CONCERNING ADVISER AND AFFILIATED COMPANIES
IFG, a Delaware corporation, serves as the Company's investment adviser. IFG
is a wholly-owned subsidiary of INVESCO North American Holdings, Inc.
("INAH"), 1315 Peachtree Street, N.E., Atlanta, Georgia 30309. INAH is an in-
direct wholly-owned subsidiary of INVESCO./1/ The corporate headquarters of
INVESCO are
- --------
/1/ The intermediary companies between INAH and INVESCO are as follows: INVESCO,
Inc., INVESCO Group Services, Inc. and INVESCO North American Group, Ltd.,
each of which is wholly-owned by its immediate parent.
11
<PAGE>
located at 11 Devonshire Square, London EC2M 4YR, England. IFG's offices are
located at 7800 East Union Avenue, Denver, Colorado 80237. IFG currently
serves as investment adviser of 14 open-end investment companies having aggre-
gate net assets of $13.4 billion. Exhibit B to this Proxy Statement includes a
list of investment companies, including the Company, for which the Adviser or
the Sub-Advisers provide advisory services and which have similar investment
objectives to those of the Funds, and sets forth the net assets of and advi-
sory fees payable by such companies.
The principal executive officer and directors of IFG and their principal oc-
cupations are:
Dan J. Hesser, Chairman of the Board, President, Chief Executive Officer;
Brian N. Minturn, Executive Vice President and Director; Frank M. Bishop, Di-
rector, also, President and Chief Operating Officer of INVESCO, Inc.; Samuel
T. DeKinder, Director, also, Institutional Marketing Manager of INVESCO North
America; Hubert L. Harris, Jr., Director, also, President of INVESCO Services,
Inc., Director of INVESCO, Chief Executive Officer of INVESCO Individual Serv-
ices Group; Robert J. O'Connor, Director, also, Chief Executive Officer and
President of INVESCO Retirement Plan Services, a division of IFG; and R. Dal-
ton Sim, Director, also, President and Director of ITC.
The address of each of the foregoing officers and directors is 7800 East
Union Avenue, Denver, Colorado 80237, with the exception of the address of
Messrs. Bishop, DeKinder and Harris, which is 1315 Peachtree Street, N.E., At-
lanta, Georgia 30309 and Mr. O'Connor, whose address is 1355 Peachtree Street,
N.E., Atlanta, Georgia 30309.
IFG also acts as the Company's Distributor. Pursuant to an Administrative
Services Agreement between the Company and IFG, IFG also provides administra-
tive services to the Company, including sub-accounting and recordkeeping serv-
ices and functions. During the fiscal year ended July 31, 1996, the Company
paid IFG total compensation of $35,428 in payment of such services ($24,037
and $11,391 of such compensation was paid IFG by the Balanced Fund and the
Multi-Asset Allocation Fund, respectively).
During the fiscal year ended July 31, 1996, the Company paid IFG, which also
serves as the Company's registrar, transfer agent and dividend disbursing
agent, total compensation of $229,889 for such services ($203,967 and $25,922
of such compensation was paid IFG by the Balanced Fund and the Multi-Asset Al-
location Fund, respectively).
Pursuant to each of the Funds' Plan and Agreement of Distribution pursuant
to Rule 12b-1 under the 1940 Act, the Company paid IFG during the fiscal year
ended July 31, 1996, total reimbursements of $239,063 ($216,431 and $22,632 of
such reimbursements was paid IFG by the Balanced Fund and the Multi-Asset Al-
location Fund, respectively).
Once the Merger is consummated and the Proposed Agreements are approved, IFG
fully intends to continue to provide the same level, quality and nature of the
foregoing services to the Company and its Funds as are currently being provid-
ed.
INFORMATION CONCERNING SUB-ADVISERS
INVESCO Trust Company
INVESCO Trust Company ("ITC"), 7800 East Union Avenue, Denver, Colorado
80237, a Colorado trust company incorporated in 1969, is a wholly-owned sub-
sidiary of IFG. IFG, as investment adviser, has contracted
12
<PAGE>
with ITC for investment advisory and research services on behalf of the Bal-
anced Fund. ITC has the primary responsibility for providing portfolio invest-
ment management services to the Fund. ITC also served as adviser or sub-ad-
viser to 47 investment portfolios as of October 31, 1996, including 27 portfo-
lios in the INVESCO group. These 47 portfolios had aggregate assets of approx-
imately $12.5 billion as of October 31, 1996. In addition, ITC provides in-
vestment management services to private clients, including employee benefit
plans that may be invested in a collective trust sponsored by ITC.
The principal executive officer and directors of ITC and their principal oc-
cupations are:
R. Dalton Sim, President, Chief Executive Officer and Director; Frank M.
Bishop, Director, also, President and Chief Operating Officer of INVESCO,
Inc.; Samuel T. DeKinder, Director, also, Institutional Marketing Manager of
INVESCO North America; and Dan J. Hesser, Director, also, President, Chief Ex-
ecutive Officer and Director of IFG.
The address of each of the foregoing officers and directors is set forth
above.
INVESCO Management & Research, Inc.
INVESCO Management & Research, Inc. ("IMR"), 101 Federal Street, Boston,
Massachusetts 02110, formerly Gardener and Preston Moss, Inc., is a wholly-
owned subsidiary of INAH. IFG, as investment adviser, has contracted with IMR
for investment advisory and research services on behalf of the Multi-Asset Al-
location Fund. IMR has the primary responsibility for providing portfolio in-
vestment management services to the Fund. IMR also acts as sub-adviser to the
INVESCO Small Company Fund and the INVESCO MultiFlex Fund and offers invest-
ment services to U.S. institutions and wealthy individuals.
The principal executive officer and directors of IMR and their principal oc-
cupations are:
Frank J. Keeler, Chief Executive Officer, President, and Director; Frank M.
Bishop, Chairman of the Board, also, President and Chief Operating Officer of
INVESCO, Inc.; and William M. McCarthy, Senior Vice President and Director.
The address of Mr. Bishop is 1315 Peachtree Street, N.E., Atlanta, Georgia
30309. The address of Messrs. Keeler and McCarthy is 101 Federal Street, Bos-
ton, Massachusetts 02110.
VOTE REQUIRED
As provided under the 1940 Act, approval of the Proposed Advisory Agreement
will require the affirmative vote of a majority of the outstanding shares of
each Fund voting separately as a class and approval of each of the respective
Proposed Sub-Advisory Agreements will require the affirmative vote of a major-
ity of the outstanding shares of each Fund, voting separately as a class. Such
a majority is defined in the 1940 Act as the lesser of: (a) 67% or more of the
shares present at such meeting, if the holders of more than 50% of the out-
standing shares of each Fund are present or represented by proxy, or (b) more
than 50% of the total outstanding shares of each Fund.
THE DIRECTORS, INCLUDING A MAJORITY OF THE INDEPENDENT DIRECTORS, RECOMMEND
THAT ALL OF THE COMPANY'S SHAREHOLDERS VOTE TO APPROVE THE PROPOSED ADVISORY
AGREEMENT BETWEEN THE COMPANY AND IFG, THAT SHAREHOLDERS OF THE BALANCED FUND
VOTE TO APPROVE THE PROPOSED SUB-ADVISORY AGREEMENT BETWEEN IFG AND ITC AND
THAT SHAREHOLDERS OF THE MULTI-ASSET ALLOCATION FUND VOTE TO APPROVE THE PRO-
POSED SUB-ADVISORY AGREEMENT BETWEEN IFG AND IMR.
13
<PAGE>
PROPOSAL 2: ELECTION OF DIRECTORS OF THE COMPANY
The Company currently has eleven Directors. Vacancies on the Board are gen-
erally filled by appointment by the remaining Directors. However, the 1940 Act
provides that vacancies may not be filled by Directors unless thereafter at
least two-thirds of the Directors shall have been elected by shareholders. To
enable the requirement to be met in the future without the necessity of call-
ing additional shareholder meetings, shareholders are being asked at this
Meeting to elect the current eleven Directors to hold office until the next
meeting of shareholders or until their successors are elected and qualified.
Under the provisions of the Company's by-laws, as permitted by Maryland law,
the Company does not anticipate holding annual shareholder meetings. Thus, the
Directors will be elected for indefinite terms.
Seven of the current Directors are "Independent Directors," i.e., Directors
who are not "interested persons" of the Company, as that term is defined in
the 1940 Act. The nominees for election as Directors have been proposed by the
Directors now serving or, in the case of nominees for positions as Independent
Directors, by the Independent Directors now serving. It is possible that the
Board will consider the election of one additional Independent Director at its
February 1997 meeting.
The persons named as attorneys-in-fact in the enclosed proxy have advised
the Company that unless a proxy instructs them to withhold authority to vote
for all listed nominees or for any individual nominee, they will vote all val-
idly executed proxies for the election of the nominees named below. All of the
nominees have consented to being named in this Proxy Statement and to serve,
if elected, and no circumstances now known will prevent any of the nominees
from serving. If any nominee should be unable or unwilling to serve, the proxy
will be voted for a substitute nominee proposed by the present Directors or in
the case of an Independent Director nominee, by the Independent Directors.
Set forth below is information concerning the nominees for Directors to be
elected at this Meeting:
<TABLE>
<CAPTION>
NUMBER OF
COMPANY SHARES
POSITION, IF ANY, WITH THE COMPANY, DIRECTOR OR BENEFICIALLY
PRINCIPAL OCCUPATION AND EXECUTIVE OFFICER OWNED DIRECTLY OR
BUSINESS EXPERIENCE OF THE INDIRECTLY ON
NAME AND AGE (DURING PAST FIVE YEARS) COMPANY SINCE DEC. 9, 1996(1)
------------ ----------------------------------- ----------------- -----------------
<S> <C> <C> <C>
Charles W. Chairman of the Board of the Company. 1993 None
Brady*(3),(5),(6) Chief Executive Officer and Director
Age 61 of INVESCO and of various subsidiaries
thereof; Chairman of the Board of
INVESCO Advisor Funds, Inc. ("Advisor
Funds"), INVESCO Treasurer's Series
Trust ("Treasurer's Series Trust") and
The Global Health Sciences Fund
("GHSF").
Dan J. Hesser*(3),(5) President, Chief Executive Officer and 1993 None
Age 56 Director of the Company. Chairman of
the Board, President and Chief Execu-
tive Officer of IFG; Director of ITC;
Trustee of GHSF; Chairman and Director
of Britannia North American Holdings,
Inc.
Fred A. Vice Chairman of the Board of the Com- 1993 None
Deering(2),(3),(5) pany. Vice Chairman of Advisor Funds
Age 68 and Treasurer's Series Trust; Trustee
of GHSF; formerly, Chairman of the Ex-
ecutive Committee and Chairman of the
Board of Security Life of Denver In-
surance Company, Denver, Colorado; Di-
rector of ING American Holding Company
and ING Life Insurance Company of New
York.
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF
COMPANY SHARES
POSITION, IF ANY, WITH THE COMPANY, DIRECTOR OR BENEFICIALLY
PRINCIPAL OCCUPATION AND EXECUTIVE OFFICER OWNED DIRECTLY OR
BUSINESS EXPERIENCE OF THE INDIRECTLY ON
NAME AND AGE (DURING PAST FIVE YEARS) COMPANY SINCE DEC. 9, 1996(1)
------------ ----------------------------------- ----------------- -----------------
<S> <C> <C> <C>
Dr. Victor L. Director of the Company. Professor 1993 None
Andrews(4),(6) Emeritus, Chairman Emeritus and Chair-
Age 66 man of the CFO Roundtable of the De-
partment of Finance of Georgia State
University, Atlanta, Georgia; Presi-
dent, Andrews Financial Associates,
Inc. (consulting firm); formerly, mem-
ber of the faculties of the Harvard
Business School and the Sloan School
of Management of MIT. Dr. Andrews is
also a Director of The Southeastern
Thrift and Bank Fund, Inc., Sheffield
Total Return Fund and Sheffield Inter-
mediate-Term Bond Fund.
Bob R. Baker(3),(4),(5) Director of the Company. President and 1993 None
Age 60 Chief Executive Officer of AMC Cancer
Research Center, Denver, Colorado,
since January 1989.
Lawrence H. Director of the Company. Trust Consul- 1993 None
Budner(2),(6) tant; prior to June 30, 1987, Senior
Age 66 Vice President and Senior Trust Offi-
cer of InterFirst Bank, Dallas, Texas.
Daniel D. Director of the Company. Financial 1993 None
Chabris(2),(3),(5) Consultant; Assistant Treasurer of
Age 73 Colt Industries, Inc., New York, New
York, from 1966 to 1988.
A. D. Frazier, Jr.*(4) Director of the Company. Executive 1995 713.1540
Age 52 Vice President of INVESCO; from 1991
to 1996, Senior Executive Vice Presi-
dent and Chief Operating Officer of
the Atlanta Committee for the Olympic
Games; Trustee of GHSF; Director of
Charter Medical Corp.
Hubert L. Harris, Jr.* Director of the Company. Chairman of 1996 462.4030
Age 53 the Board and Chief Executive Officer
of INVESCO Services, Inc.; Chief Exec-
utive Officer of INVESCO Individual
Services Group; Director of INVESCO;
President, Chief Executive Officer and
Chief Financial Officer of Advisor
Funds; President and Trustee of GHSF;
President of the Georgia Institute of
Technology Alumini Association and
member of the Alumni Board of Trustees
thereof.
Kenneth T. Director of the Company. Formerly, 1993 None
King(3),(4),(5),(6) Chairman of the Board of The Capitol
Age 71 Life Insurance Company, Providence
Washington Insurance Company, and Di-
rector of numerous subsidiaries
thereof in the U.S.; formerly, Chair-
man of the Board of The Providence
Capitol Companies in the United King-
dom and in Guernsey; Chairman of the
Board of the Symbion Corporation (a
high technology company) until 1987.
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF
COMPANY SHARES
POSITION, IF ANY, WITH THE COMPANY, DIRECTOR OR BENEFICIALLY
PRINCIPAL OCCUPATION AND EXECUTIVE OFFICER OWNED DIRECTLY OR
BUSINESS EXPERIENCE OF THE INDIRECTLY ON
NAME AND AGE (DURING PAST FIVE YEARS) COMPANY SINCE DEC. 9, 1996(1)
------------ ----------------------------------- ----------------- -----------------
<S> <C> <C> <C>
John W. McIntyre(2) Director of the Company. Retired; for- 1995 None
Age 66 merly, Vice Chairman of the Board of
Directors of The Citizens and Southern
Corporation and Chairman of the Board
and Chief Executive Officer of The
Citizens and Southern Georgia Corp.
and Citizens and Southern National
Bank; Director of Golden Poultry Co.,
Inc.; Trustee of GHSF and of Gables
Residential Trust.
</TABLE>
(1) As interpreted by the Securities and Exchange Commission, a security is
beneficially owned by a person if that person has or shares voting power
or investment power with respect to the security. The persons listed
have partial or complete voting and investment power with respect to
their respective Fund shares.
(2) Member of Audit Committee.
(3) Member of Executive Committee.
(4) Member of Management Liaison Committee.
(5) Member of Valuation Committee.
(6) Member of Compensation Committee.
* Because of his affiliation with INVESCO, with the Company's investment
advisers or with companies affiliated with INVESCO, this individual is
deemed to be an "interested person" of the Company as that term is de-
fined in the 1940 Act.
As discussed above under Proposal No. 1, the terms of the Merger Agreement
require that immediately after the Merger is effected, 75% of the members of
the Board not be "interested persons" of the Company, as that term is defined
in the 1940 Act. As noted above, seven of the current Directors (63%) are In-
dependent Directors. Thus, the composition of the Board you are being asked to
elect would not meet the 75% requirement. Therefore, prior to the closing of
the Merger, it is the current intention that a sufficient number of "interest-
ed" Directors would resign from the Board so that the Board would be in com-
pliance with the 75% requirement at the time the Merger is effected.
The committees of the Board are the compensation committee, executive com-
mittee, audit committee, management liaison committee and valuation committee.
The Company does not have a nominating committee. During the intervals between
the meetings of the Board, and except for certain powers which, under applica-
ble law and/or the Company's by-laws, may only be exercised by the full Board,
the executive committee may exercise all powers and authority of the Board in
the management of Company business. All decisions are subsequently submitted
for ratification by the full Board. The audit committee, consisting of four
Independent Directors, meets periodically with the Company's independent ac-
countants and the executive officers of the Company. This committee reviews
the accounting principles being applied by the Company in financial report-
16
<PAGE>
ing, 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 past fiscal
year, the Board met three times, the audit committee met four times, the man-
agement liaison committee met three times and the compensation committee met
once. During the Company's last fiscal year, each director nominee attended 75%
or more of the aggregate of the Board meetings and meetings of the committees
of the Board on which he served.
The Company pays its Independent Directors the directors' fees and board vice
chairman and committee chairmen fees described below and reimburses Independent
Directors for travel expenses incurred in attending meetings. Messrs. Brady,
Harris, Hesser and, as of November 1, 1996, Frazier, as "interested persons" of
the Company and of other funds in the INVESCO Fund Complex,/2/ receive compen-
sation and are reimbursed for travel expenses incurred in attending meetings as
officers or employees of IFG or of its affiliated companies, but do not receive
any directors' fees or other compensation from the Company or from other compa-
nies in the INVESCO Fund Complex for their services as Directors.
The following table sets forth, for the fiscal year ended July 31, 1996: the
compensation paid by the Company to its seven current Independent Directors
(and to Mr. Frazier, for the period before he became an employee of INVESCO on
November 1, 1996) for services rendered in their capacities as Directors of the
Company; the benefits accrued as Company expenses with respect to the Defined
Benefit Deferred Compensation Plan discussed below; and the estimated annual
benefits to be received by these Directors upon retirement as a result of their
service to the Company. In addition, the table sets forth the total compensa-
tion paid by all of the mutual funds in the INVESCO Fund Complex to these Di-
rectors for services rendered in their capacities as directors or trustees dur-
ing the year ended December 31, 1995. As of December 31, 1995, there were 48
funds in the INVESCO Fund Complex.
- --------
/2/The following investment companies comprise the INVESCO Fund Complex: INVESCO
Diversified Funds, Inc., INVESCO Dynamics Fund, Inc., INVESCO Emerging Oppor-
tunity Funds, Inc., INVESCO Growth Fund, Inc., INVESCO Income Funds, Inc.,
INVESCO Industrial Income Fund, Inc., INVESCO International Funds, Inc.,
INVESCO Money Market Funds, Inc., INVESCO Multiple Asset Funds, Inc., INVESCO
Specialty Funds, Inc., INVESCO Strategic Portfolios, Inc., INVESCO Tax-Free
Income Funds, Inc., INVESCO Value Trust, INVESCO Variable Investment Funds,
Inc. (collectively, the "IFG-Distributed Funds"); INVESCO Advisor Funds,
Inc.; The Global Health Sciences Fund; and INVESCO Treasurer's Series Trust.
17
<PAGE>
<TABLE>
<CAPTION>
PENSION/ TOTAL COMPENSATION
AGGREGATE RETIREMENT BENEFITS ESTIMATED ANNUAL FROM INVESCO
COMPENSATION FROM ACCRUED AS PART OF BENEFITS UPON FUND COMPLEX PAID
NAME AND POSITION THE COMPANY(1) COMPANY EXPENSES(2) RETIREMENT(3) TO DIRECTORS(1)
----------------- ----------------- ------------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Fred A. Deering, 2,212 120 100 87,350
Vice Chairman of
the Board
Victor L. Andrews, 2,180 106 110 68,000
Director
Bob R. Baker, 2,189 109 147 73,000
Director
Lawrence H. Budner, 2,165 113 110 68,350
Director
Daniel D. Chabris, 2,190 129 78 73,350
Director
A. D. Frazier, Jr., 2,144 0 0 63,500
Director(4)
Kenneth T. King, 2,179 124 90 70,000
Director
John W. McIntyre, 2,158 0 0 67,850
Director(4)
------ ------ --- -------
TOTAL 17,417 701 635 571,400
====== ====== === =======
% OF NET ASSETS 0.0140%(5) 0.0006%(5) 0.0043%(6)
</TABLE>
(1) The vice chairman of the Board, the chairmen of the audit, management
liaison and compensation committees, and the members of the audit, man-
agement liaison, executive and valuation committees receive compensation
for serving in such capacities in addition to the compensation paid to
all Independent Directors.
(2) Represents benefits accrued with respect to the Defined Benefit Deferred
Compensation Plan discussed below, and not compensation deferred at the
election of the Directors.
(3) These amounts represent the Company's share of the estimated annual ben-
efits payable by the INVESCO Fund Complex (excluding GHSF, which does
not participate in any retirement plan) upon the Directors' retirement,
calculated using the current method of allocating director compensation
among the funds in the INVESCO Fund Complex. These estimated benefits
assume retirement at age 72 and that the basic retainer payable to the
Directors will be adjusted periodically for inflation, for increases in
the number of funds in the INVESCO Fund Complex, and for other reasons
during the period in which retirement benefits are accrued on behalf of
the respective Directors. This results in lower estimated benefits for
Directors who are closer to retirement and higher estimated benefits for
Directors who are further from retirement. With the exception of Messrs.
Frazier and McIntyre, each of these Directors has served as a
director/trustee of one or more of the funds in the INVESCO Fund Complex
for the minimum five-year period required to be eligible to participate
in the Defined Benefit Deferred Compensation Plan.
(4) Messrs. Frazier and McIntyre began serving as Directors of the Company
on April 19, 1995.
18
<PAGE>
(5) Total as a percentage of the Company's net assets as of July 31, 1996.
(6) Total as a percentage of the net assets of the INVESCO Fund Complex as
of December 31, 1995.
The officers of the Company, all of whom are officers and employees of, and
paid by, IFG, are responsible for the day-to-day administration of the Company
and of each of the Funds. The investment adviser for each Fund has the primary
responsibility for making investment decisions on behalf of that Fund. These
investment decisions are reviewed by the IFG investment committee.
All of the officers and Directors of the Company hold comparable positions
with each of the IFG-Distributed Funds. In addition, all of the directors of
the Company are also directors of INVESCO Advisor Funds, Inc. (formerly known
as The EBI Funds, Inc.); and, with the exception of Mr. Hesser, trustees of
INVESCO Treasurer's Series Trust.
VOTE REQUIRED
The Directors must be elected by a plurality of the votes present at the
Meeting in person or by proxy and entitled to vote, provided a quorum is pres-
ent.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S SHAREHOLDERS VOTE TO
ELECT ALL OF THE NOMINEES LISTED ABOVE.
PROPOSAL 3: RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Directors of the Company, including a majority of its Independent Direc-
tors, have selected Price Waterhouse LLP to continue to serve as independent
accountants of the Company for the fiscal year ending July 31, 1997, subject to
ratification by the Company's shareholders. This firm has no direct financial
interest or material indirect financial interest in the Company. Representa-
tives of this firm 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 following summarizes Price Waterhouse LLP's audit services for the fiscal
year ended July 31, 1996: audit of annual financial statements; preparation of
the Company's federal and state income tax returns; preparation of the
Company's federal excise tax return; consultation with the Company's audit com-
mittee; and routine consultation on financial accounting and reporting matters.
The Board authorized all services performed by Price Waterhouse LLP on behalf
of the Company. In addition, the Board annually reviews the scope of services
to be provided by Price Waterhouse LLP and considers the effect, if any, that
performance of any non-audit services might have on audit independence.
An audit committee, consisting of four Independent Directors, meets periodi-
cally with the Company's independent accountants to review accounting and re-
porting requirements.
VOTE REQUIRED
The ratification of the selection of the independent accountants must be ap-
proved by a majority of the shares present at the Meeting in person or by proxy
and entitled to vote, provided a quorum is present.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S SHAREHOLDERS VOTE IN FA-
VOR OF PROPOSAL 3.
19
<PAGE>
OTHER BUSINESS
The management of the Company has no business to bring before the Meeting
other than the matters described above. Should any other business be presented
at the Meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgment.
SHAREHOLDER PROPOSALS
The Company does not hold annual meetings of shareholders. Shareholders wish-
ing 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 the Company, 7800 East Union Avenue, Denver, Colorado 80237.
The Company has not received any shareholder proposals to be presented at this
Meeting.
By Order of the Board of Directors,
/s/ Glen A. Payne
Glen A. Payne
Secretary
December 26, 1996
20
<PAGE>
EXHIBIT A.1.
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made this 28th day of February, 1997, in Denver, Colorado,
by and between INVESCO FUNDS GROUP, INC. (the "Adviser"), a Delaware corpora-
tion, and INVESCO Multiple Asset Funds, Inc., a Maryland corporation (the
"Fund").
WITNESSETH:
WHEREAS, the Fund is a corporation organized under the laws of the State of
Maryland; and
WHEREAS, the Fund 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 di-
vided into two series, each representing an interest in a separate portfolio
of investments (such series initially being the INVESCO Multi-Asset Allocation
Fund and INVESCO Balanced Fund (the "Portfolios")); and
WHEREAS, the Fund desires that the Adviser manage its investment operations
and the Adviser desires to manage said operations;
NOW, THEREFORE, in consideration of these premises and of the mutual cove-
nants and agreements hereinafter contained, the parties hereto agree as fol-
lows:
1. Investment Management Services. The Adviser hereby agrees to manage the
investment operations of the Fund and its Portfolios, subject to the terms of
this Agreement and to the supervision of the Fund's directors (the "Direc-
tors"). The Adviser agrees to perform, or arrange for the performance of, the
following specific services for the Fund:
(a) to manage the investment and reinvestment of all the assets, now or
hereafter acquired, of the Fund and the Portfolios of the Fund;
(b) to maintain a continuous investment program for the Fund and each
Portfolio of the Fund, consistent with (i) the Fund's and each Portfolio's
investment policies as set forth in the Fund'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 Fund or any Portfolio of the Fund, as from time
to time amended and in use under the Securities Act of 1933, as amended,
and (ii) the Fund's status as a regulated investment company under the In-
ternal Revenue Code of 1986, as amended;
(c) to determine what securities are to be purchased or sold for the
Fund and its Portfolios, unless otherwise directed by the Directors of the
Fund, and to execute transactions accordingly;
(d) to provide to the Fund and the Portfolios of the Fund the benefit of
all of the investment analyses and research, the reviews of current eco-
nomic conditions and trends, and the consideration of long range invest-
ment policy now or hereafter generally available to investment advisory
customers of the Adviser;
(e) to determine what portion of the Fund and each Portfolio of the Fund
should be invested in common stocks, preferred stocks, Government obliga-
tions, commercial paper, certificates of deposit, bankers' acceptances,
variable amount notes, corporate debt obligations, and any other autho-
rized securities;
A.1.-1
<PAGE>
(f) to make recommendations as to the manner in which voting rights,
rights to consent to Fund and/or Portfolio action and any other rights
pertaining to the Fund's portfolio securities shall be exercised; and
(g) to calculate the net asset value of the Fund and each Portfolio, as
applicable, as required by the 1940 Act, subject to such procedures as may
be established from time to time by the Fund's Directors, based upon the
information provided to the Adviser by the Fund or by the custodian, co-
custodian or sub- custodian of the Fund's or any of the Portfolios' assets
(the "Custodian") or such other source as designated by the Directors from
time to time.
With respect to execution of transactions for the Fund and for the Portfo-
lios, 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 is directed at all times to obtain
for the Fund and the Portfolios the most favorable execution and price; after
fulfilling this primary requirement of obtaining the most favorable execution
and price, the Adviser is hereby expressly authorized to consider as a second-
ary 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 re-
quirement for adjustment of the advisory fee payable pursuant to paragraph 4
hereof. The Adviser may follow a policy of considering sales of shares of the
Fund as a factor in the selection of broker/dealers to execute portfolio
transactions, subject to the requirements of best execution discussed above.
The Adviser shall for all purposes herein provided be deemed to be an inde-
pendent contractor.
2. Allocation of Costs and Expenses. The Adviser shall reimburse the Fund
monthly for any salaries paid by the Fund to officers, Directors, and full
time employees of the Fund who also are officers, general partners or employ-
ees of the Adviser or its affiliates. Except for such sub-accounting, record-
keeping, and administrative services which are to be provided by the Adviser
to the Fund under the Administrative Services Agreement between the Fund and
the Adviser dated October 20, 1993, which was approved on October 20, 1993, by
the Fund's board of directors, including all of the independent directors, at
the Fund's request the Adviser shall also furnish to the Fund, at the expense
of the Adviser, such competent executive, statistical, administrative, inter-
nal accounting and clerical services as may be required in the judgment of the
Directors of the Fund. These services will include, among other things, the
maintenance (but not preparation) of the Fund's accounts and records, and the
preparation (apart from legal and accounting costs) of all requisite corporate
documents such as tax returns and reports to the Securities and Exchange Com-
mission and Fund shareholders. The Adviser also will furnish, at the Adviser's
expense, such office space, equipment and facilities as may be reasonably re-
quested by the Fund from time to time.
Except to the extent expressly assumed by the Adviser herein and except to
the extent required by law to be paid by the Adviser, the Fund shall pay all
costs and expenses in connection with the operations and organization of the
Fund. Without limiting the generality of the foregoing, such costs and ex-
penses payable by the Fund include the following:
(a) all brokers' commissions, issue and transfer taxes, and other costs
chargeable to the Fund and any Portfolio in connection with securities
transactions to which the Fund or any Portfolio is a party or in connec-
tion with securities owned by the Fund or any Portfolio;
(b) the fees, charges and expenses of any independent public accoun-
tants, custodian, depository, dividend disbursing agent, dividend rein-
vestment agent, transfer agent, registrar, independent pricing services
and legal counsel for the Fund or for any Portfolio;
A.1.-2
<PAGE>
(c) the interest on indebtedness, if any, incurred by the Fund or any
Portfolio;
(d) the taxes, including franchise, income, issue, transfer, business
license, and other corporate fees payable by the Fund or any Portfolio to
federal, state, county, city, or other governmental agents;
(e) the fees and expenses involved in maintaining the registration and
qualification of the Fund 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;
(f) the compensation and expenses of its Directors;
(g) the costs of printing and distributing reports, notices of share-
holders' meetings, proxy statements, dividend notices, prospectuses,
statements of additional information and other communications to the
Fund's shareholders, as well as all expenses of shareholders' meetings and
Directors' meetings;
(h) all costs, fees or other expenses arising in connection with the or-
ganization and filing of the Fund'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 regis-
tration and qualification of its securities under the laws of any state
and the approval of the Fund's operations by any other federal or state
authority;
(i) the expenses of repurchasing and redeeming shares of the Fund;
(j) insurance premiums;
(k) the costs of designing, printing, and issuing certificates repre-
senting shares of beneficial interest of the Fund;
(l) extraordinary expenses, including fees and disbursements of Fund
counsel, in connection with litigation by or against the Fund or any Port-
folio;
(m) premiums for the fidelity bond maintained by the Fund pursuant to
Section 17(g) of the 1940 Act and rules promulgated thereunder (except for
such premiums as may be allocated to the Adviser as an insured thereun-
der);
(n) association and institute dues; and
(o) the expenses, if any, of distributing shares of the Fund paid by the
Fund pursuant to a Plan and Agreement of Distribution adopted under Rule
12b-1 of the Investment Company Act of 1940.
3. Use of Affiliated Companies. In connection with the rendering of the
services required to be provided by the Adviser under this Agreement, the Ad-
viser may, to the extent it deems appropriate and subject to compliance with
the requirements of applicable laws and regulations, and upon receipt of writ-
ten approval of the Fund, make use of its affiliated companies and their em-
ployees; provided that the Adviser shall supervise and remain fully responsi-
ble 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 Fund 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
A.1.-3
<PAGE>
determined net asset value of each Portfolio of the Fund, as determined by
valuations made in accordance with the Fund's procedure for calculating the
Portfolios' net asset value as described in the Fund's Prospectus and/or
Statement of Additional Information. The advisory fee to the Adviser with re-
spect to the Portfolio designated as INVESCO Multi-Asset Allocation Fund shall
be computed at the following annual rate: 0.75% of the first $500 million of
such Portfolio's average net assets, 0.65% of such Portfolio's average net as-
sets in excess of $500 million but not more than $1 billion, and 0.50% of such
Portfolio's average net assets in excess of $1 billion. The advisory fee to
the Adviser with respect to the Portfolio designated as INVESCO Balanced Fund
shall be computed at the following annual rate: 0.60% of the first $350 mil-
lion of such Portfolio's average net assets, 0.55% of such Portfolio's average
net assets in excess of $350 million but not more than $700 million, and 0.50%
of such Portfolio's average net assets in excess of $700 million.
During any period when the determination of the Portfolios' net asset value
is suspended by the Directors of the Fund, the net asset value of a share of
the Portfolios 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
Fund or any Portfolio 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.
If, in any given year, the sum of a Portfolio's expenses exceeds the most
restrictive state imposed annual expense limitation, the Adviser will be re-
quired to reimburse the Portfolio for such excess expenses promptly. Interest,
taxes and extraordinary items such as litigation costs are not deemed expenses
for purposes of this paragraph and shall be borne by the Fund or such Portfo-
lio in any event. Expenditures, including costs incurred in connection with
the purchase or sale of portfolio securities, which are capitalized in accor-
dance 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 connec-
tion with purchases or sales of securities for the investment portfolio of the
Fund or any Portfolio, neither the Adviser nor its officers or employees will
act as a principal or agent for any party other than the Fund or any Portfolio
or receive any commissions. The Adviser will comply with all applicable laws
in acting hereunder including, without limitation, the 1940 Act; the Invest-
ment 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 the
Portfolios of the Fund, and unless sooner terminated as hereinafter provided,
shall remain in force for an initial term expiring two years from the date of
execution, and from year to year thereafter, but only as long as such continu-
ance is specifically approved at least annually (i) by a vote of a majority of
the outstanding voting securities of the Portfolios of the Fund or by the Di-
rectors of the Fund, and (ii) by a majority of the Directors of the Fund who
are not interested persons of the Adviser or the Fund by votes cast in person
at a meeting called for the purpose of voting on such approval. In the event
of the disapproval of this Agreement, or of the continuation hereof, by the
shareholders of a particular Portfolio (or by the Directors of the Fund as to
a particular Portfolio), the parties intend that such disapproval shall be ef-
fective only as to such Portfolio, and that such disapproval shall not affect
the validity or effectiveness of the approval of this Agreement, or of the
continuation hereof, by the shareholders of any other Portfolio (or by the Di-
rectors, including a majority of the disinterested Directors) as to such other
Portfolio; in such case, this Agreement shall be deemed to have been validly
approved or continued, as the case may be, as to such other Portfolio.
A.1.-4
<PAGE>
This Agreement may, on 60 days' prior written notice, be terminated without
the payment of any penalty, by the Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Fund or, with respect to
a particular Portfolio, by a majority of the outstanding voting securities of
that Portfolio, as the case may be, or by the Adviser. This Agreement shall
immediately terminate in the event of its assignment, unless an order is is-
sued by the Securities and Exchange Commission conditionally or uncondition-
ally 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 provi-
sions of this paragraph 6, the definitions contained in Section 2(a) of the
1940 Act and the applicable rules under the 1940 Act (particularly the defini-
tions of "interested person," "assignment" and "vote of a majority of the out-
standing voting securities") shall be applied.
The Adviser agrees to furnish to the Directors of the Fund such information
on an annual basis 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 para-
graph 4 earned prior to such termination.
7. Non-Exclusive Services. The Adviser shall, during the term of this Agree-
ment, be entitled to render investment advisory services to others, including,
without limitation, other investment companies with similar objectives to
those of the Fund or any Portfolio of the Fund. 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 Fund or any
Portfolio 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 Fund
or any Portfolio and the Adviser's other customers.
8. Liability. The Adviser shall have no liability to the Fund or any Portfo-
lio or to the Fund'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 Fund or
any Portfolio 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 Fund and the Adviser, and no material amendment of this Agreement shall
be effective unless approved by (1) the vote of a majority of the Directors of
the Fund, including a majority of the Directors who are not parties to this
Agreement or interested persons of any such party cast in person at a meeting
called for the purpose of voting on such amendment, and (2) the vote of a ma-
jority of the outstanding voting securities of any Portfolio of the Fund af-
fected by such amendment; 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 amendment(s) are made with the
approval of (1) the Directors and (2) a majority of the Directors of the Fund
who are not interested persons of the Adviser or the Fund. In the event of the
disapproval of an amendment of this Agreement by the shareholders of a partic-
ular Portfolio (or by the Directors of the Fund as to a particular Portfolio),
the parties intend that such disapproval shall be effective only as to such
Portfolio, and that such disapproval shall not affect the validity or effec-
tiveness of the approval of the amendment by the shareholders of any other
Portfolio (or by the Directors, including a
A.1.-5
<PAGE>
majority of the disinterested Directors) as to such other Portfolio; in such
case, this Agreement shall be deemed to have been validly amended as to such
other Portfolio.
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 Fund 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 MULTIPLE ASSET FUNDS, INC.
By: _______________________________
President
ATTEST:
_____________________________________
Secretary
INVESCO FUNDS GROUP, INC.
By: _______________________________
Senior Vice President
ATTEST:
_____________________________________
Secretary
A.1.-6
<PAGE>
EXHIBIT A.2.
SUB-ADVISORY AGREEMENT
AGREEMENT made this 28th day of February, 1997, by and between INVESCO Funds
Group, Inc. ("INVESCO"), a Delaware corporation, and INVESCO MANAGEMENT & RE-
SEARCH, INC., a Massachusetts corporation ("the Sub-Adviser").
WITNESSETH:
WHEREAS, INVESCO MULTIPLE ASSET FUNDS, INC. (the "Company") is engaged in
business as a diversified, open end management investment company registered
under the Investment Company Act of 1940, as amended (hereinafter referred to
as the "Investment Company Act") and has one class of shares (the "Shares"),
which is divided into series, each representing an interest in a separate
portfolio of investments, with one such series being designated the INVESCO
Multi-Asset Allocation Fund (the "Fund"); and
WHEREAS, INVESCO and the Sub-Adviser are engaged in rendering investment ad-
visory services and are registered as investment advisers under the Investment
Advisers Act of 1940; and
WHEREAS, INVESCO has entered into an Investment Advisory Agreement with the
Company (the "INVESCO Investment Advisory Agreement"), pursuant to which
INVESCO is required to provide investment advisory services to the Company,
and, upon receipt of written approval of the Company, is authorized to retain
companies which are affiliated with INVESCO to provide such services; and
WHEREAS, the Sub-Adviser is willing to provide investment advisory services
to the Company on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants hereinaf-
ter contained, INVESCO and the Sub-Adviser hereby agree as follows:
ARTICLE I
DUTIES OF THE SUB-ADVISER
INVESCO hereby employs the Sub-Adviser to act as investment adviser to the
Company and to furnish the investment advisory services described below, sub-
ject to the broad supervision of INVESCO and Board of Directors of the Compa-
ny, for the period and on the terms and conditions set forth in this Agree-
ment. The Sub- Adviser hereby accepts such assignment and agrees during such
period, at its own expense, to render such services and to assume the obliga-
tions herein set forth for the compensation provided for herein. The Sub-
Adviser shall for all purposes herein be deemed to be an independent contrac-
tor and, unless otherwise expressly provided or authorized herein, shall have
no authority to act for or represent the Company in any way or otherwise be
deemed an agent of the Company.
The Sub-Adviser hereby agrees to manage the investment operations of the
Fund, subject to the supervision of the Company's directors (the "Directors")
and INVESCO. Specifically, the Sub-Adviser agrees to perform the following
services:
(a) to manage the investment and reinvestment of all the assets, now or
hereafter acquired, of the Fund, and to execute all purchases and sales of
portfolio securities;
A.2.-1
<PAGE>
(b) to maintain a continuous investment program for the Fund, consistent
with (i) the Fund's investment policies as set forth in the Company's Reg-
istration 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 additional information of the Fund, 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 In-
ternal Revenue Code of 1986, as amended;
(c) to determine what securities are to be purchased or sold for the
Fund, unless otherwise directed by the Directors of the Company or
INVESCO, and to execute transactions accordingly;
(d) to provide to the Fund the benefit of all of the investment analysis
and research, the reviews of current economic conditions and trends, and
the consideration of long range investment policy now or hereafter gener-
ally available to investment advisory customers of the Sub-Adviser;
(e) to determine what portion of the Fund should be invested in the var-
ious types of securities authorized for purchase by the Fund; and
(f) to make recommendations as to the manner in which voting rights,
rights to consent to Fund action and any other rights pertaining to the
Fund's portfolio securities shall be exercised.
With respect to execution of transactions for the Fund, the Sub-Adviser is
authorized to employ such brokers or dealers as may, in the Sub-Adviser's best
judgment, implement the policy of the Fund to obtain prompt and reliable exe-
cution at the most favorable price obtainable. In assigning an execution or
negotiating the commission to be paid therefor, the Sub-Adviser is authorized
to consider the full range and quality of a broker's services which benefit
the Fund, including but not limited to research and analytical capabilities,
reliability of performance, and financial soundness and responsibility. Re-
search services prepared and furnished by brokers through which the Sub-Ad-
viser effects securities transactions on behalf of the Fund may be used by the
Sub-Adviser in servicing all of its accounts, and not all such services may be
used by the Sub-Adviser in connection with the Fund. The Sub-Adviser may fol-
low a policy of considering sales of shares of the Fund as a factor in the se-
lection of broker/dealers to execute portfolio transactions, subject to the
requirements of best execution discussed above. In the selection of a broker
or dealer for execution of any negotiated transaction, the Sub-Adviser shall
have no duty or obligation to seek advance competitive bidding for the most
favorable negotiated commission rate for such transaction, or to select any
broker solely on the basis of its purported or "posted" commission rate for
such transaction, provided, however, that the Sub-Adviser shall consider such
"posted" commission rates, if any, together with any other information avail-
able at the time as to the level of commissions known to be charged on compa-
rable transactions by other qualified brokerage firms, as well as all other
relevant factors and circumstances, including the size of any contemporaneous
market in such securities, the importance to the Fund of speed, efficiency,
and confidentiality of execution, the execution capabilities required by the
circumstances of the particular transactions, and the apparent knowledge or
familiarity with sources from or to whom such securities may be purchased or
sold. Where the commission rate reflects services, reliability and other rele-
vant factors in addition to the cost of execution, the Sub-Adviser shall have
the burden of demonstrating that such expenditures were bona fide and for the
benefit of the Fund.
A.2.-2
<PAGE>
ARTICLE II
ALLOCATION OF CHARGES AND EXPENSES
The Sub-Adviser assumes and shall pay for maintaining the staff and person-
nel necessary to perform its obligations under this Agreement, and shall, at
its own expense, provide the office space, equipment and facilities necessary
to perform its obligations under this Agreement. Except to the extent ex-
pressly assumed by the Sub-Adviser herein and except to the extent required by
law to be paid by the Sub-Adviser, INVESCO and/or the Company shall pay all
costs and expenses in connection with the operations of the Fund.
ARTICLE III
COMPENSATION OF THE SUB-ADVISER
For the services rendered, facilities furnished, and expenses assumed by the
Sub-Adviser, INVESCO shall pay to the Sub-Adviser a fee, computed daily and
paid as of the last day of each month, using for each daily calculation the
most recently determined net asset value of the Fund, as determined by a valu-
ation made in accordance with the Fund's procedures for calculating its net
asset value as described in the Fund's Prospectus and/or Statement of Addi-
tional Information. The advisory fee to the Sub-Adviser shall be computed at
the annual rate of 0.375% of the first $500 million of the Fund's average net
assets, 0.325% of the Fund's average net assets in excess of $500 million but
not more than $1 billion, and 0.25% of the Fund's average net assets in excess
of $1 billion. During any period when the determination of the Fund's net as-
set value is suspended by the Directors of the Company, the net asset value of
a share of the Fund as of the last business day prior to such suspension
shall, for the purpose of this Article III, be deemed to be the net asset
value at the close of each succeeding business day until it is again deter-
mined. However, no such fee shall be paid to the Sub-Adviser with respect to
any assets of the Fund which may be invested in any other investment company
for which the Sub-Adviser serves as investment adviser or sub-adviser. The fee
provided for hereunder shall be prorated in any month in which this Agreement
is not in effect for the entire month. The Sub-Adviser shall be entitled to
receive fees hereunder only for such periods as the INVESCO Investment Advi-
sory Agreement remains in effect.
ARTICLE IV
LIMITATION OF LIABILITY OF SUB-ADVISER
The Sub-Adviser shall not be liable for any error of judgment, mistake of
law or for any loss arising out of any investment or for any act or omission
in the performance of sub-advisory services rendered with respect to the Com-
pany or the Fund, except for willful misfeasance, bad faith or gross negli-
gence in the performance of its duties or by reason of reckless disregard of
its obligations and duties hereunder. As used in this Article IV, "Sub-Advis-
er" shall include any affiliates of the Sub-Adviser performing services con-
templated hereby and directors, officers and employees of the Sub-Adviser and
such affiliates.
A.2.-3
<PAGE>
ARTICLE V
ACTIVITIES OF THE SUB-ADVISER
The services of the Sub-Adviser to the Fund are not to be deemed to be ex-
clusive, the Sub-Adviser and any person controlled by or under common control
with the Sub-Adviser (for purposes of this Article V referred to as "affili-
ates") being free to render services to others. It is understood that direc-
tors, officers, employees and shareholders of the Company are or may become
interested in the Sub-Adviser and its affiliates, as directors, officers, em-
ployees and shareholders or otherwise, and that directors, officers, employees
and shareholders of the Sub-Adviser, INVESCO and their affiliates are or may
become interested in the Company as directors, officers and employees.
ARTICLE VI
AVOIDANCE OF INCONSISTENT POSITIONS AND
COMPLIANCE WITH APPLICABLE LAWS
In connection with purchases or sales of securities for the investment port-
folio of the Fund, neither the Sub-Adviser nor any of its directors, officers
or employees will act as a principal or agent for any party other than the
Fund or receive any commissions. The Sub-Adviser will comply with all applica-
ble 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.
ARTICLE VII
DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall become effective as of the date it is approved by a ma-
jority of the outstanding voting securities of the Fund, and shall remain in
force for an initial term of two years from the date of execution, and from
year to year thereafter until its termination in accordance with this Article
VII, but only so long as such continuance is specifically approved at least
annually by (i) the Directors of the Company, or by the vote of a majority of
the outstanding voting securities of the Fund, and (ii) a majority of those
Directors who are not parties to this Agreement or interested persons of any
such party cast in person at a meeting called for the purpose of voting on
such approval.
This Agreement may be terminated at any time, without the payment of any
penalty, by INVESCO, the Fund by vote of the Directors of the Company, or by
vote of a majority of the outstanding voting securities of the Fund, or by the
Sub-Adviser. A termination by INVESCO or the Sub-Adviser shall require sixty
days' written notice to the other party and to the Company, and a termination
by the Company shall require such notice to each of the parties. This Agree-
ment shall automatically terminate in the event of its assignment to the ex-
tent required by the Investment Company Act of 1940 and the Rules thereunder.
The Sub-Adviser agrees to furnish to the Directors of the Company such in-
formation on an annual basis as may reasonably be necessary to evaluate the
terms of this Agreement.
Termination of this Agreement shall not affect the right of the Sub-Adviser
to receive payments on any unpaid balance of the compensation described in Ar-
ticle III hereof earned prior to such termination.
A.2.-4
<PAGE>
ARTICLE VIII
AMENDMENTS OF THIS AGREEMENT
No provision of this Agreement may be orally changed or discharged, but may
only be modified by an instrument in writing signed by the Sub-Adviser and
INVESCO. In addition, no amendment to this Agreement shall be effective unless
approved by (1) the vote of a majority of the Directors of the Company, in-
cluding a majority of the Directors who are not parties to this Agreement or
interested persons of any such party cast in person at a meeting called for
the purpose of voting on such amendment and (2) the vote of a majority of the
outstanding voting securities of the Fund (other than an amendment which can
be effective without shareholder approval under applicable law).
ARTICLE IX
DEFINITIONS OF CERTAIN TERMS
In interpreting the provisions of this Agreement, the terms "vote of a ma-
jority of the outstanding voting securities," "assignments," "affiliated per-
son" and "interested person," when used in this Agreement, shall have the re-
spective meanings specified in the Investment Company Act and the Rules and
Regulations thereunder, subject, however, to such exemptions as may be granted
by the Securities and Exchange Commission under said Act.
ARTICLE X
GOVERNING LAW
This Agreement shall be construed in accordance with the laws of the State
of Colorado and the applicable provisions of the Investment Company Act. To
the extent that the applicable laws of the State of Colorado, or any of the
provisions herein, conflict with the applicable provisions of the Investment
Company Act, the latter shall control.
ARTICLE XI
MISCELLANEOUS
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.
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.
A.2.-5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
INVESCO FUNDS GROUP, INC.
By: _______________________________
President
ATTEST:
_____________________________________
Secretary
INVESCO MANAGEMENT & RESEARCH,
INC.
By: _______________________________
President
ATTEST:
_____________________________________
Secretary
A.2.-6
<PAGE>
EXHIBIT A.3.
SUB-ADVISORY AGREEMENT
AGREEMENT made this 28th day of February, 1997, by and between INVESCO Funds
Group, Inc. ("INVESCO"), a Delaware corporation, and INVESCO TRUST COMPANY, a
Colorado corporation ("the Sub-Adviser").
WITNESSETH:
WHEREAS, INVESCO MULTIPLE ASSET FUNDS, INC. (the "Company") is engaged in
business as a diversified, open end management investment company registered
under the Investment Company Act of 1940, as amended (hereinafter referred to
as the "Investment Company Act") and has one class of shares (the "Shares"),
which is divided into series, each representing an interest in a separate
portfolio of investments, with one such series being designated the INVESCO
Balanced Fund (the "Fund"); and
WHEREAS, INVESCO and the Sub-Adviser are engaged in rendering investment ad-
visory services and are registered as investment advisers under the Investment
Advisers Act of 1940; and
WHEREAS, INVESCO has entered into an Investment Advisory Agreement with the
Company (the "INVESCO Investment Advisory Agreement"), pursuant to which
INVESCO is required to provide investment advisory services to the Company,
and, upon receipt of written approval of the Company, is authorized to retain
companies which are affiliated with INVESCO to provide such services; and
WHEREAS, the Sub-Adviser is willing to provide investment advisory services
to the Company on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants hereinaf-
ter contained, INVESCO and the Sub-Adviser hereby agree as follows:
ARTICLE I
DUTIES OF THE SUB-ADVISER
INVESCO hereby employs the Sub-Adviser to act as investment adviser to the
Company and to furnish the investment advisory services described below, sub-
ject to the broad supervision of INVESCO and Board of Directors of the Compa-
ny, for the period and on the terms and conditions set forth in this Agree-
ment. The Sub-Adviser hereby accepts such assignment and agrees during such
period, at its own expense, to render such services and to assume the obliga-
tions herein set forth for the compensation provided for herein. The Sub-
Adviser shall for all purposes herein be deemed to be an independent contrac-
tor and, unless otherwise expressly provided or authorized herein, shall have
no authority to act for or represent the Company in any way or otherwise be
deemed an agent of the Company.
The Sub-Adviser hereby agrees to manage the investment operations of the
Fund, subject to the supervision of the Company's directors (the "Directors")
and INVESCO. Specifically, the Sub-Adviser agrees to perform the following
services:
(a) to manage the investment and reinvestment of all the assets, now or
hereafter acquired, of the Fund, and to execute all purchases and sales of
portfolio securities;
A.3.-1
<PAGE>
(b) to maintain a continuous investment program for the Fund, consistent
with (i) the Fund's investment policies as set forth in the Company's Reg-
istration 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 additional information of the Fund, 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 In-
ternal Revenue Code of 1986, as amended;
(c) to determine what securities are to be purchased or sold for the
Fund, unless otherwise directed by the Directors of the Company or
INVESCO, and to execute transactions accordingly;
(d) to provide to the Fund the benefit of all of the investment analysis
and research, the reviews of current economic conditions and trends, and
the consideration of long range investment policy now or hereafter gener-
ally available to investment advisory customers of the Sub-Adviser;
(e) to determine what portion of the Fund should be invested in the var-
ious types of securities authorized for purchase by the Fund; and
(f) to make recommendations as to the manner in which voting rights,
rights to consent to Fund action and any other rights pertaining to the
Fund's portfolio securities shall be exercised.
With respect to execution of transactions for the Fund, the Sub-Adviser is
authorized to employ such brokers or dealers as may, in the Sub-Adviser's best
judgment, implement the policy of the Fund to obtain prompt and reliable exe-
cution at the most favorable price obtainable. In assigning an execution or
negotiating the commission to be paid therefor, the Sub-Adviser is authorized
to consider the full range and quality of a broker's services which benefit
the Fund, including but not limited to research and analytical capabilities,
reliability of perfor- mance, and financial soundness and responsibility. Re-
search services prepared and furnished by brokers through which the Sub-Ad-
viser effects securities transactions on behalf of the Fund may be used by the
Sub-Adviser in servicing all of its accounts, and not all such services may be
used by the Sub-Adviser in connection with the Fund. The Sub-Adviser may fol-
low a policy of considering sales of shares of the Fund as a factor in the se-
lection of broker/dealers to execute portfolio transactions, subject to the
requirements of best execution discussed above. In the selection of a broker
or dealer for execution of any negotiated transaction, the Sub-Adviser shall
have no duty or obligation to seek advance competitive bidding for the most
favorable negotiated commission rate for such transaction, or to select any
broker solely on the basis of its purported or "posted" commission rate for
such transaction, provided, however, that the Sub-Adviser shall consider such
"posted" commission rates, if any, together with any other information avail-
able at the time as to the level of commissions known to be charged on compa-
rable transactions by other qualified brokerage firms, as well as all other
relevant factors and circumstanc- es, including the size of any contemporane-
ous market in such securities, the importance to the Fund of speed, efficien-
cy, and confidentiality of execution, the execution capabilities required by
the circumstances of the particular transactions, and the apparent knowledge
or familiarity with sources from or to whom such securities may be purchased
or sold. Where the commission rate reflects services, reliability and other
relevant factors in addition to the cost of execution, the Sub-Adviser shall
have the burden of demonstrating that such expenditures were bona fide and for
the benefit of the Fund.
A.3.-2
<PAGE>
ARTICLE II
ALLOCATION OF CHARGES AND EXPENSES
The Sub-Adviser assumes and shall pay for maintaining the staff and person-
nel necessary to perform its obligations under this Agreement, and shall, at
its own expense, provide the office space, equipment and facilities necessary
to perform its obligations under this Agreement. Except to the extent ex-
pressly assumed by the Sub-Adviser herein and except to the extent required by
law to be paid by the Sub-Adviser, INVESCO and/or the Company shall pay all
costs and expenses in connection with the operations of the Fund.
ARTICLE III
COMPENSATION OF THE SUB-ADVISER
For the services rendered, facilities furnished, and expenses assumed by the
Sub-Adviser, INVESCO shall pay to the Sub-Adviser an annual fee, computed
daily and paid as of the last day of each month, using for each daily calcula-
tion the most recently determined net asset value of the Fund, as determined
by a valuation made in accordance with the Fund's procedures for calculating
its net asset value as described in the Fund's Prospectus and/or Statement of
Additional Information. The advisory fee to the Sub-Adviser shall be computed
at the annual rate of 0.30% of the first $350 million of the Fund's average
net assets, 0.275% of the Fund's average net assets in excess of $350 million
but not more than $700 million, and 0.25% of the Fund's average net assets in
excess of $700 million. During any period when the determination of the Fund's
net asset value is suspended by the Directors of the Company, the net asset
value of a share of the Fund as of the last business day prior to such suspen-
sion shall, for the purpose of this Article III, be deemed to be the net asset
value at the close of each succeeding business day until it is again deter-
mined. However, no such fee shall be paid to the Sub-Adviser with respect to
any assets of the Fund which may be invested in any other investment company
for which the Sub-Adviser serves as investment adviser or sub-adviser. The fee
provided for hereunder shall be prorated in any month in which this Agreement
is not in effect for the entire month. The Sub-Adviser shall be entitled to
receive fees hereunder only for such periods as the INVESCO Investment Advi-
sory Agreement remains in effect.
ARTICLE IV
LIMITATION OF LIABILITY OF SUB-ADVISER
The Sub-Adviser shall not be liable for any error of judgment, mistake of
law or for any loss arising out of any investment or for any act or omission
in the performance of sub-advisory services rendered with respect to the Com-
pany or the Fund, except for willful misfeasance, bad faith or gross negli-
gence in the performance of its duties or by reason of reckless disregard of
its obligations and duties hereunder. As used in this Article IV, "Sub-Advis-
er" shall include any affiliates of the Sub-Adviser performing services con-
templated hereby and directors, officers and employees of the Sub-Adviser and
such affiliates.
A.3.-3
<PAGE>
ARTICLE V
ACTIVITIES OF THE SUB-ADVISER
The services of the Sub-Adviser to the Fund are not to be deemed to be ex-
clusive, the Sub-Adviser and any person controlled by or under common control
with the Sub-Adviser (for purposes of this Article V referred to as "affili-
ates") being free to render services to others. It is understood that direc-
tors, officers, employees and shareholders of the Company are or may become
interested in the Sub-Adviser and its affiliates, as directors, officers, em-
ployees and shareholders or otherwise and that directors, officers, employees
and shareholders of the Sub-Adviser, INVESCO and their affiliates are or may
become interested in the Company as directors, officers and employees.
ARTICLE VI
AVOIDANCE OF INCONSISTENT POSITIONS AND
COMPLIANCE WITH APPLICABLE LAWS
In connection with purchases or sales of securities for the investment port-
folio of the Fund, neither the Sub-Adviser nor any of its directors, officers
or employees will act as a principal or agent for any party other than the
Fund or receive any commissions. The Sub-Adviser will comply with all applica-
ble 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.
ARTICLE VII
DURATION AND TERMINATION OF THIS AGREEMENT
This Agreement shall become effective as of the date it is approved by a ma-
jority of the outstanding voting securities of the Fund, and shall remain in
force for an initial term of two years from the date of execution, and from
year to year thereafter until its termination in accordance with this Article
VII, but only so long as such continuance is specifically approved at least
annually by (i) the Directors of the Company, or by the vote of a majority of
the outstanding voting securities of the Fund, and (ii) a majority of those
Directors who are not parties to this Agreement or interested persons of any
such party cast in person at a meeting called for the purpose of voting on
such approval.
This Agreement may be terminated at any time, without the payment of any
penalty, by INVESCO, the Fund by vote of the Directors of the Company, or by
vote of a majority of the outstanding voting securities of the Fund, or by the
Sub-Adviser. A termination by INVESCO or the Sub-Adviser shall require sixty
days' written notice to the other party and to the Company, and a termination
by the Company shall require such notice to each of the parties. This Agree-
ment shall automatically terminate in the event of its assignment to the ex-
tent required by the Investment Company Act of 1940 and the Rules thereunder.
The Sub-Adviser agrees to furnish to the Directors of the Company such in-
formation on an annual basis as may reasonably be necessary to evaluate the
terms of this Agreement.
Termination of this Agreement shall not affect the right of the Sub-Adviser
to receive payments on any unpaid balance of the compensation described in Ar-
ticle III hereof earned prior to such termination.
A.3.-4
<PAGE>
ARTICLE VIII
AMENDMENTS OF THIS AGREEMENT
No provision of this Agreement may be orally changed or discharged, but may
only be modified by an instrument in writing signed by the Sub Adviser and
INVESCO. In addition, no amendment to this Agreement shall be effective unless
approved by (1) the vote of a majority of the Directors of the Company, in-
cluding a majority of the Directors who are not parties to this Agreement or
interested persons of any such party cast in person at a meeting called for
the purpose of voting on such amendment and (2) the vote of a majority of the
outstanding voting securities of the Fund (other than an amendment which can
be effective without shareholder approval under applicable law).
ARTICLE IX
DEFINITIONS OF CERTAIN TERMS
In interpreting the provisions of this Agreement, the terms "vote of a ma-
jority of the outstanding voting securities," "assignments," "affiliated per-
son" and "interested person," when used in this Agreement, shall have the re-
spective meanings specified in the Investment Company Act and the Rules and
Regulations thereunder, subject, however, to such exemptions as may be granted
by the Securities and Exchange Commission under said Act.
ARTICLE X
GOVERNING LAW
This Agreement shall be construed in accordance with the laws of the State
of Colorado and the applicable provisions of the Investment Company Act. To
the extent that the applicable laws of the State of Colorado, or any of the
provisions herein, conflict with the applicable provisions of the Investment
Company Act, the latter shall control.
ARTICLE XI
MISCELLANEOUS
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.
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.
A.3.-5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
INVESCO FUNDS GROUP, INC.
By: _______________________________
President
ATTEST:
_____________________________________
Secretary
INVESCO TRUST COMPANY
By: _______________________________
President
ATTEST:
_____________________________________
Secretary
A.3.-6
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISER WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
INCOME FUNDS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
INCOME FUNDS 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
OBJECTIVE ADVISER RATE (BASED ON FEE RATE (BASED OCTOBER 31,
AVERAGE NET ON AVERAGE NET 1996)
ASSETS) ASSETS)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SHORT-TERM BOND Current INVESCO INVESCO .50% of the first .25% of the first $10,884,689
FUND* Income; Funds Trust $300 million; $300 million;
Liquidity Group, Company .40% of the next .20% of the next
Inc. $200 million; $200 million;
.30% over .15% over
$500 million $500 million
- ------------------------------------------------------------------------------------------------------
INTERMEDIATE Capital INVESCO INVESCO .60% of the first .16% of the first $44,684,053
GOVERNMENT Appreciation Funds Capital $500 million; $500 million;
BOND FUND* and Income Group, Management, .50% of the next .13% of the next
Inc. Inc. $500 million; $500 million;
.40% over .11% over
$1 billion $1 billion
- ------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT Current INVESCO INVESCO .55% of the first .25% of the first $58,176,601
SECURITIES Income Funds Trust $300 million; $200 million;
FUND* Group, Company .45% of the next .20% over
Inc. $200 million; $200 million
.35% over
$500 million
- ------------------------------------------------------------------------------------------------------
SELECT INCOME Current INVESCO INVESCO .55% of the first .25% of the first $265,380,728
FUND* Income Funds Trust $300 million; $200 million;
Group, Company .45% of the next .20% over
Inc. $200 million; $200 million
.35% over
$500 million
- ------------------------------------------------------------------------------------------------------
HIGH YIELD Current INVESCO INVESCO .50% of the first .25% of the first $398,615,748
FUND* Income Funds Trust $300 million; $200 million;
Group, Company .40% of the next .20% over
Inc. $200 million; $200 million
.30% over
$500 million
- ------------------------------------------------------------------------------------------------------
</TABLE>
B-1
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISER WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
INCOME FUNDS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
INCOME FUNDS 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
OBJECTIVE ADVISER RATE (BASED ON FEE RATE (BASED OCTOBER 31,
AVERAGE NET ON AVERAGE NET 1996)
ASSETS) ASSETS)
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
VIF-HIGH YIELD Current INVESCO INVESCO .60% of the first .30% of the first $11,404,398
FUND* Income Funds Trust $500 million; $500 million;
Group, Company .55% of the next .275% of the next
Inc. $500 million; $500 million;
.45% over .225% of over
$1 billion $1 billion
- -------------------------------------------------------------------------------------------------------
INCOME Capital INVESCO INVESCO .65% * .10% $27,752,586
PORTFOLIO Appreciation Services, Capital
and Income Inc. Management,
Inc.
- -------------------------------------------------------------------------------------------------------
</TABLE>
* Indicates whether fee has been waived or absorbed during the Fund's past
fiscal year.
B-2
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR INVESTMENT
OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY; BALANCED FUNDS
<TABLE>
<CAPTION>
BALANCED 1940 ACT ADVISER SUB-ADVISER ADVISORY FEE SUB-ADVISORY NET ASSETS
FUNDS OBJECTIVE RATE (BASED ON FEE RATE (BASED ON (AT OCTOBER 31,
AVERAGE NET AVERAGE NET 1996)
ASSETS) ASSETS)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BALANCED Capital INVESCO INVESCO .60% of the first .30% of the first $130,629,237
FUND* Appreciation Funds Trust $350 million; $350 million;
and Income Group, Company .55% of the next .275% of the next
Inc. $350 million; $350 million;
.50% over .25% over
$700 million $700 million
- ------------------------------------------------------------------------------------------------------
MULTI-ASSET Capital INVESCO INVESCO .75% of the first .375% of the first $12,702,769
ALLOCATION Appreciation Funds Management $500 million; $500 million;
FUND* and Income Group, & Research, .65% of the next .325% of the next
Inc. Inc. $500 million; $500 million;
.50% over .25% over
$1 billion $1 billion
- ------------------------------------------------------------------------------------------------------
TOTAL Capital INVESCO INVESCO .75% of the first .20% of the first $1,129,593,849
RETURN Appreciation Funds Capital $500 million; $500 million;
FUND and Income Group, Management, .65% of the next .17% of the next
Inc. Inc. $500 million; $500 million;
.50% over .13% over
$1 billion $1 billion
- ------------------------------------------------------------------------------------------------------
MULTIFLEX Capital INVESCO INVESCO 1% .35 of the first $243,766,866
PORTFOLIO Appreciation Services, Management $500 million;
and Income Inc. & Research, .25% over
Inc. $500 million
- ------------------------------------------------------------------------------------------------------
FLEX Capital INVESCO INVESCO .75% .20% $473,695,882
PORTFOLIO Appreciation Services, Capital
and Income Inc. Management,
Inc.
- ------------------------------------------------------------------------------------------------------
VIF-TOTAL Capital INVESCO INVESCO .75% of the first .375% of the first $12,525,451
RETURN Appreciation Funds Capital $500 million; $500 million;
PORTFOLIO* and Income Group, Management, .65% of the next .325% of the next
Inc. Inc. $500 million; $500 million;
.55% over .275% over
$1 billion $1 billion
- ------------------------------------------------------------------------------------------------------
MAXIM Capital Great INVESCO 1% .55% of the first $5,909,241
INVESCO Appreciation West Trust $50 million;
ADR and Income Life Company .50% of the next
PORTFOLIO Assurance $50 million;
Company .40% over
$100 million
</TABLE>
B-3
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR INVESTMENT
OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY; BALANCED FUNDS
<TABLE>
<CAPTION>
BALANCED 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
FUNDS OBJECTIVE ADVISER RATE (BASED ON FEE RATE (BASED OCTOBER 31,
AVERAGE NET ON AVERAGE NET 1996)
ASSETS) ASSETS)
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MAXIM Capital Great West INVESCO 1% .50% of the first $2,997,147
INVESCO Appreciation Life Trust $25 million;
BALANCED and Income Assurance Company .45% of the next
PORTFOLIO Company $50 million;
.40% of the next
$25 million;
.35% over
$100 million
</TABLE>
* Indicates whether fee has been waived or absorbed during the Fund's past
fiscal year.
B-4
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
INTERNATIONAL FUNDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
INTERNATIONAL 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
FUNDS OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INTERNATIONAL Capital INVESCO INVESCO 1.0% of the first .25% of the first $94,586,594
GROWTH Appreciation Funds Asset $500 million; $500 million;
FUND and Income Group, Management .75% of the next .1875% of the next
Inc. Limited $500 million; $500 million;
.65% over .1625% over
$1 billion $1 billion
- -----------------------------------------------------------------------------------------------------
EUROPEAN Capital INVESCO INVESCO .75% of the first .45% of the first $300,588,228
FUND Appreciation Funds Asset $350 million; $350 million;
Group, Management .65% of the next .40% of the next
Inc. Limited $350 million; $350 million;
.55% over .35% over
$700 million $700 million
- -----------------------------------------------------------------------------------------------------
PACIFIC Capital INVESCO INVESCO .75% of the first .45% of the first $149,869,919
BASIN Appreciation Funds Asset $350 million; $350 million;
FUND Group, Management .65% of the next .40% of the next
Inc. Limited $350 million; $350 million;
.55% over .35% over
$700 million $700 million
- -----------------------------------------------------------------------------------------------------
EUROPEAN Capital INVESCO INVESCO .75% of the first .375% of the first $117,484,141
SMALL Appreciation Funds Asset $500 million; $500 million;
COMPANY Group, Management .65% of the next .325% of the next
FUND Inc. Limited $500 million; $500 million;
.55% over .275% over
$1 billion $1 billion
- -----------------------------------------------------------------------------------------------------
</TABLE>
B-5
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
INTERNATIONAL FUNDS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
INTERNATIONAL 1940 ACT ADVISER SUB-ADVISER ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
FUNDS OBJECTIVE RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
LATIN Capital INVESCO INVESCO .75% of the first .375% of the first $32,864,679
AMERICAN Appreciation Funds Asset $500 million; $500 million;
GROWTH Group, Management .65% of the next .325% of the next
FUND Inc. Limited $500 million; $500 million;
.55% over .275% over
$1 billion $1 billion
- --------------------------------------------------------------------------------------------------------
ASIAN Capital INVESCO INVESCO .75% of the first .375% of the first $16,483,400
GROWTH Appreciation Funds Asia $500 million; $500 million;
FUND* Group, Limited .65% of the next .325% of the next
Inc. $500 million; $500 million;
.55% over .275% over
$1 billion $1 billion
- --------------------------------------------------------------------------------------------------------
INTERNATIONAL Capital INVESCO INVESCO 1.0% .35% of the first $42,820,898
VALUE Appreciation Services, Capital $50 million;
PORTFOLIO and Income Inc. Management, .30% of the next
Inc. $50 million;
.25% over
$100 million
- --------------------------------------------------------------------------------------------------------
</TABLE>
* Indicates whether the fee has been waived or absorbed during the Fund's
past fiscal year.
B-6
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
GROWTH & VALUE FUNDS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
GROWTH & 1940 ACT ADVISER SUB-ADVISER ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
VALUE OBJECTIVE RATE (BASED ON FEE RATE OCTOBER 31,
FUNDS AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
VALUE EQUITY Capital INVESCO INVESCO .75% of the first .20% of the first $221,736,052
FUND Appreciation Funds Capital $500 million; $500 million;
and Income Group, Management, .65% of the next .17% of the next
Inc. Inc. $500 million; $500 million;
.50% over .13% over
$1 billion $1 billion
- -----------------------------------------------------------------------------------------------------
GROWTH FUND Long-Term INVESCO INVESCO .60% of the first .25% of the first $650,140,716
Capital Funds Trust $350 million; $200 million;
Growth; Group, Company .55% of the next .20% over
Current Inc. $350 million; $200 million
Income .50% over
Secondary $700 million
- -----------------------------------------------------------------------------------------------------
DYNAMICS Capital INVESCO INVESCO .60% of the first .25% of the first $836,458,920
FUND Appreciation Funds Trust $350 million; $200 million;
Group, Company .55% of the next .20% over
Inc. $350 million; $200 million
.50% over
$700 million
- -----------------------------------------------------------------------------------------------------
EMERGING Long-Term INVESCO INVESCO .75% of the first .25% of the first $275,668,167
GROWTH FUND Capital Funds Trust $350 million; $200 million;
Growth Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- -----------------------------------------------------------------------------------------------------
SMALL Long-Term INVESCO INVESCO .75% .375% $47,292,558
COMPANY Capital Funds Management
FUND* Growth Group, & Research,
Inc. Inc.
- -----------------------------------------------------------------------------------------------------
EQUITY Capital INVESCO INVESCO .75% .20% $134,188,186
PORTFOLIO Appreciation Services, Management
and Income Inc. & Research,
Inc.
- -----------------------------------------------------------------------------------------------------
</TABLE>
B-7
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
GROWTH & VALUE FUNDS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
GROWTH & 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
VALUE OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
FUNDS AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
JOHN HANCOCK Aggressive John Hancock INVESCO .80% of the first .55% of the first $9,621,404
VARIABLE SERIES Growth Mutual Management $100 million; .75% $100 million;
TRUST -- SMALL Life & Research, of the next .50% of the next
CAP VALUE Insurance Inc. $100-$200 million; $100 million;
FUND Company .65% over .40% over
$200 million $200 million
- ----------------------------------------------------------------------------------------------------------
MAXIM Long-Term Great West INVESCO 1% .55% of the first $2,997,147
INVESCO Capital Life Trust $25 million;
SMALL-CAP Growth Assurance Company .50% of the next
GROWTH Company $50 million;
PORTFOLIO .40% of the next
$25 million;
.35% over
$100 million
- ----------------------------------------------------------------------------------------------------------
</TABLE>
* Indicates whether fee has been waived or absorbed during the Fund's past
fiscal year.
B-8
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
EQUITY INCOME FUNDS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
EQUITY 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
INCOME FUNDS OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INDUSTRIAL Current INVESCO INVESCO .60% of the first .25% of the first $4,206,106,717
INCOME FUND Income Funds Trust $350 million; $200 million;
Group, Company .55% of the next .20% over
Inc. $350 million; $200 million
.50% over
$700 million
- --------------------------------------------------------------------------------------------------------
UTILITIES PORTFOLIO* Capital INVESCO INVESCO .75% of the first .25% of the first $152,742,377
Appreciation Funds Trust $350 million; $200 million;
and Income Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- --------------------------------------------------------------------------------------------------------
VIF-INDUSTRIAL Current INVESCO INVESCO .75% of the first .375% of the first $19,167,082
INCOME PORTFOLIO* Income Funds Trust $500 million; $500 million;
Group, Company .65% of the next .325% of the next
Inc. $500 million; $500 million;
.55% over .275% over
$1 billion $1 billion
- --------------------------------------------------------------------------------------------------------
VIF-UTILITIES Capital INVESCO INVESCO .60% of the first .30% of the first $1,295,949
PORTFOLIO* Appreciation Funds Trust $500 million; $500 million;
and Income Group, Company .55% of the next .275% of the next
Inc. $500 million; $500 million;
.45% over .225% over
$1 billion $1 billion
- --------------------------------------------------------------------------------------------------------
</TABLE>
B-9
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
EQUITY INCOME FUNDS
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
EQUITY 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
INCOME FUNDS OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AMERICAN High American INVESCO .75% .50% of the first $320,023,507
SKANDIA TRUST -- Current Skandia Trust $25 million;
EQUITY INCOME Income; Investment Company .45% of the next
PORTFOLIO Capital Services, Inc. $50 million;
Growth .40% of the next
Secondary $25 million;
.35% over
$100 million
- ----------------------------------------------------------------------------------------------------
</TABLE>
* Indicates whether fee has been waived or absorbed during the Fund's past
fiscal year.
B-10
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
SECTOR FUNDS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
SECTOR FUNDS 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ENERGY Capital INVESCO INVESCO .75% of the first .25% of the first $236,169,412
PORTFOLIO Appreciation Funds Trust $350 million; $200 million;
Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- ------------------------------------------------------------------------------------------------
ENVIRONMENTAL Capital INVESCO INVESCO .75% of the first .25% of the first $26,793,694
SERVICES Appreciation Funds Trust $350 million; $200 million;
PORTFOLIO Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- ------------------------------------------------------------------------------------------------
FINANCIAL Capital INVESCO INVESCO .75% of the first .25% of the first $542,687,937
SERVICES Appreciation Funds Trust $350 million; $200 million;
PORTFOLIO* Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- ------------------------------------------------------------------------------------------------
GOLD Capital INVESCO INVESCO .75% of the first .25% of the first $277,892,364
PORTFOLIO Appreciation Funds Trust $350 million; $200 million;
Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- ------------------------------------------------------------------------------------------------
HEALTH Capital INVESCO INVESCO .75% of the first .25% of the first $933,828,112
SCIENCES Appreciation Funds Trust $350 million; $200 million;
PORTFOLIO Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- ------------------------------------------------------------------------------------------------
</TABLE>
B-11
<PAGE>
EXHIBIT B
FUNDS ADVISED BY THE ADVISER OR THE SUB-ADVISERS WITH SIMILAR
INVESTMENT OBJECTIVES AND STRATEGIES TO THOSE OF THE COMPANY;
SECTOR FUNDS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
SECTOR FUNDS 1940 ACT ADVISER SUB- ADVISORY FEE SUB-ADVISORY NET ASSETS (AT
OBJECTIVE ADVISER RATE (BASED ON FEE RATE OCTOBER 31,
AVERAGE NET (BASED ON 1996)
ASSETS) AVERAGE NET
ASSETS)
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
LEISURE Capital INVESCO INVESCO .75% of the first .25% of the first $252,297,128
PORTFOLIO Appreciation Funds Trust $350 million; $200 million;
Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- -------------------------------------------------------------------------------------------------------
TECHNOLOGY Capital INVESCO INVESCO .75% of the first .25% of the first $789,610,651
PORTFOLIO Appreciation Funds Trust $350 million; $200 million;
Group, Company .65% of the next .20% over
Inc. $350 million; $200 million
.55% over
$700 million
- -------------------------------------------------------------------------------------------------------
WORLDWIDE Capital INVESCO INVESCO .65% of the first .325% of the first $4,225,087
CAPITAL Appreciation Funds Trust $500 million; $500 million;
GOODS FUND* Group, Company .55% of the next .275% of the next
Inc. $500 million; $500 million;
.45% over .225% over
$1 billion $1 billion
- -------------------------------------------------------------------------------------------------------
WORLDWIDE Capital INVESCO INVESCO .65% of the first .325% of the first $51,218,075
COMMUNICATIONS Appreciation Funds Trust $500 million; $500 million;
FUND and Income Group, Company .55% of the next .275% of the next
Inc. $500 million; $500 million;
.45% over .225% over
$1 billion $1 billion
- -------------------------------------------------------------------------------------------------------
REAL ESTATE Capital INVESCO INVESCO .90% .35% of the first $15,293,490
PORTFOLIO Appreciation Services, Realty $100 million;
and Income Inc. Advisers, .25% over
Inc. $100 million
- -------------------------------------------------------------------------------------------------------
THE GLOBAL Capital INVESCO None 1.0% N/A $455,821,034
HEALTH SCIENCES Appreciation Trust
FUND** Company
- -------------------------------------------------------------------------------------------------------
</TABLE>
* Indicates whether fee has been waived or absorbed during the Fund's past
fiscal year.
** Closed-end Fund
B-12
<PAGE>
TO BE SURE YOU ARE REPRESENTED, PLEASE SIGN, DATE AND RETURN
PROMPTLY.
INVESCO MULTIPLE ASSET FUNDS, INC.
INVESCO MULTI-ASSET ALLOCATION FUND
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
JANUARY 31, 1997
The undersigned hereby appoints Fred A. Deering, Dan J. Hesser and Glen A.
Payne, and each of them, proxy for the undersigned, with the power of
substitution, to vote with the same force and effect as the undersigned at the
Special Meeting of the Shareholders of the INVESCO Multi-Asset Allocation Fund
of INVESCO Multiple Asset Funds, Inc. (the "Company"), to be held at the Denver
Marriott Southeast, 6363 East Hampden Avenue, Denver, Colorado 80222, on Friday,
January 31, 1997, at 10:00 a.m. (Mountain Standard Time) and at any adjournment
thereof, upon the matters set forth below, all in accordance with and as more
fully described in the Notice of Special Meeting and Proxy Statement, dated
December 26, 1996, receipt of which is hereby acknowledged.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS, WHICH RECOMMENDS A VOTE
"FOR":
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS [X]
1.A. Proposal to approve a new investment advisory agreement between the Company
and INVESCO Funds Group, Inc. ("IFG"), such agreement to take effect only
if the proposed merger of A I M Management Group, Inc. into a wholly-owned
U.S. subsidiary of INVESCO PLC is consummated.
Vote on Proposal
For [_] Against [_] Abstain [_]
1.B. Proposal to approve a new sub-advisory agreement between IFG and INVESCO
Management & Research, Inc., such agreement to take effect only if the
proposed merger of A I M Management Group, Inc. into a wholly-owned
U.S. subsidiary of INVESCO PLC is consummated.
Vote on Proposal
For [_] Against [_] Abstain [_]
2. Proposal to elect eleven directors of the Company: Charles W. Brady, Dan J.
Hesser, Fred A. Deering, Victor L. Andrews, Bob R. Baker, Lawrence H.
Budner, Daniel D. Chabris, A.D. Frazier, Jr., Hubert L. Harris, Jr.,
Kenneth T. King and John W. McIntyre.
Vote on Directors
For All [_] Withhold All [_] For All Except [_]
To withhold authority to vote, mark "For All Except" and write the nominee's
name on the line below.
--------------------------------------------
<PAGE>
3. Proposal to ratify the selection of Price Waterhouse LLP as independent
accountants for the Company for the fiscal year ending July 31, 1997.
Vote on Proposal
For [_] Against [_] Abstain [_]
In their discretion, the Proxies are authorized to vote upon such other business
as may properly come before the meeting or any adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" PROPOSALS 1.A., 1.B., 2 and 3.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY IN THE ACCOMPANYING ENVELOPE AS
SOON AS POSSIBLE. THANK YOU.
- --------------------------------------------------------------------------------
Signature Signature Date
(Joint Owners)
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.
<PAGE>
TO BE SURE YOU ARE REPRESENTED, PLEASE SIGN, DATE AND RETURN
PROMPTLY.
INVESCO MULTIPLE ASSET FUNDS, INC.
INVESCO BALANCED FUND
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
JANUARY 31, 1997
The undersigned hereby appoints Fred A. Deering, Dan J. Hesser and Glen A.
Payne, and each of them, proxy for the undersigned, with the power of
substitution, to vote with the same force and effect as the undersigned at
the Special Meeting of the Shareholders of the INVESCO Balanced Fund of INVESCO
Multiple Asset Funds, Inc. (the "Company"), to be held at the Denver Marriott
Southeast, 6363 East Hampden Avenue, Denver, Colorado 80222, on Friday, January
31, 1997, at 10:00 a.m. (Mountain Standard Time) and at any adjournment thereof,
upon the matters set forth below, all in accordance with and as more fully
described in the Notice of Special Meeting and Proxy Statement, dated December
26, 1996, receipt of which is hereby acknowledged.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS, WHICH RECOMMENDS A VOTE
"FOR":
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS [X]
1.A. Proposal to approve a new investment advisory agreement between the Company
and INVESCO Funds Group, Inc. ("IFG"), such agreement to take effect only
if the proposed merger of A I M Management Group, Inc. into a wholly-owned
U.S. subsidiary of INVESCO PLC is consummated.
Vote on Proposal
For [_] Against [_] Abstain [_]
1.B. Proposal to approve a new sub-advisory agreement between IFG and INVESCO
Trust Company, such agreement to take effect only if the proposed merger
of A I M Management Group, Inc. into a wholly-owned U.S. subsidiary of
INVESCO PLC is consummated.
Vote on Proposal
For [_] Against [_] Abstain [_]
2. Proposal to elect eleven directors of the Company: Charles W. Brady, Dan J.
Hesser, Fred A. Deering, Victor L. Andrews, Bob R. Baker, Lawrence H.
Budner, Daniel D. Chabris, A.D. Frazier, Jr., Hubert L. Harris, Jr.,
Kenneth T. King and John W. McIntyre.
Vote on Directors
For All [_] Withhold All [_] For All Except [_]
To withhold authority to vote, mark "For All Except" and write the nominee's
name on the line below.
--------------------------------------------
<PAGE>
3. Proposal to ratify the selection of Price Waterhouse LLP as independent
accountants for the Company for the fiscal year ending July 31, 1997.
Vote on Proposal
For [ ] Against [ ] Abstain [ ]
In their discretion, the Proxies are authorized to vote upon such other business
as may properly come before the meeting or any adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" PROPOSALS 1.A., 1.B., 2 and 3.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY IN THE ACCOMPANYING ENVELOPE AS
SOON AS POSSIBLE. THANK YOU.
- --------------------------------------------------------------------------------
Signature Signature Date
(Joint Owners)
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.
