ADMINISTRATIVE SERVICES AGREEMENT
THIS AGREEMENT is made this 1st day of May, 2008, between BLACKROCK
ADVISORS, LLC. ("BAL") and ALLIANZ LIFE INSURANCE COMPANY OF NORTH AMERICA, a
life insurance company organized under the laws of the State of Minnesota the
"Insurer").
WHEREAS, BAL is the investment advisor to the BlackRock Variable Series
Funds, Inc. and BlackRock Series Fund, Inc. (the "Fund"); and
WHEREAS, the Insurer issues variable annuity contracts and/or variable
life insurance policies (the "Contracts"); and
WHEREAS, the Insurer, Allianz Life Financial Services, LLC, the Fund and
BlackRock Distributors, Inc. have entered into a Fund Participation Agreement
("Participation Agreement") dated May 1, 2008, providing for the sale of shares
of the Fund to certain separate accounts of the Insurer ("Separate Accounts");
and
WHEREAS, amounts invested in the Contracts by contract owners are
deposited in the Separate Accounts of the Insurer which will in turn purchase
shares of certain portfolios of the Fund, each of which is an investment option
offered by the Contracts (the "Portfolios"); and
WHEREAS, the Fund expects to derive substantial savings in administrative
expenses by virtue of having the Separate Accounts of the Insurer as
shareholders of record of Fund shares and having the Insurer perform certain
administrative services for the Fund (which are identified on Schedule A
hereto); and
WHEREAS, neither BAL nor the Insurer has any contractual or other legal
obligation to perform such administrative services for the Fund; and
WHEREAS, the Insurer desires to be compensated for providing such
administrative services to the Fund; and
WHEREAS, BAL desires that the Fund benefit from the lower administrative
expenses expected to result from the administrative services performed by the
Insurer holding omnibus accounts with the Fund's transfer agent on behalf of
contract owners; and
WHEREAS, BAL accordingly would prefer to compensate the Insurer for
providing administrative services to the Fund from its own profits or the
profits of its affiliates, rather than request that the Fund bear the costs of
such compensation:
NOW, THEREFORE, the parties hereto agree as follows:
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1. Administration Expense Payments.
(a) BAL or its affiliates shall pay the Insurer an amount equal to 25 basis
points (0.25%) per annum of the average daily net assets of the
Portfolios that are held in Separate Accounts of Insurer listed in
Schedule B of the Fund Participation Agreement(s).
(b) Insurer shall calculate the payment contemplated by this Section 1 at
the end of each fiscal quarter. BAL will make such payment ("Quarterly
Payment") to Insurer, after receipt of an invoice by Insurer, in a
manner mutually agreed upon by the parties from time to time.
(c) From time to time, the parties shall review the Quarterly Payment to
determine whether it exceeds or is reasonably expected to exceed the
incurred and anticipated costs, over time, of the Insurer. The parties
agree to negotiate in good faith a reduction to the Quarterly Payment as
necessary to eliminate any such excess.
2. Nature of Payments.
The parties to this Agreement recognize and agree that the payments to
the Insurer are for administrative services only and do not constitute payment
in any manner for investment advisory services or for costs of distribution of
Contracts or of Fund shares and are not otherwise related to investment
advisory or distribution services or expenses. The amount of administration
expense payments made to the Insurer pursuant to Section 1(a) of this Agreement
are derived from BAL's or its affiliate's bona fide profits from serving as
principal underwriter or investment adviser to any Fund, and are intended to
reimburse or compensate the Insurer for providing administrative services with
respect to the Contracts or any Separate Accounts.
3. Term and Termination.
(a) Any Party may terminate this Agreement, without penalty, on, sixty days'
advance written notice to the other Party. Unless so terminated, this
Agreement shall continue in effect for so long as BAL or its
successor(s) in interest, or any affiliate thereof, continues to perform
in a similar capacity for the Fund, and for so long as Insurer or its
successors(s) in interest, or any affiliate thereof, provides the
services contemplated hereunder with respect to Contracts under which
values or monies are allocated to a Portfolio.
(b) This Agreement shall automatically terminate upon (i) the termination of
the Fund Participation Agreement(s) between the Insurer and the Fund, or
(ii) the dissolution or bankruptcy of any party hereto, or in the event
that any party hereto is placed in receivership or rehabilitation, or in
the event that the management of its affairs is assumed by any
governmental, regulatory or judicial authority. (a)
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4. Amendment.
This Agreement may be amended only upon mutual agreement of the parties
hereto in writing.
5. Notices.
All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered
to the Insurer: to BAL:
Allianz Life Insurance Company of NorthBlackRock Advisors, LLC.
America Xxxx Xxxxxxxx
0000 Xxxxxx Xxxxx Xxxxx 00 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000 Xxx Xxxx, XX 00000
Attn: General Counsel
6. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be binding upon the parties
hereto and their transferees, successors and assigns. The benefits of
and the right to enforce this Agreement shall accrue to the parties and
their transferees, successors and assigns.
(b) Assignment. Neither this Agreement nor any of the rights, obligations or
liabilities of either party hereto shall be assigned without the written
consent of the other party.
(c) Intended Beneficiaries. Nothing in this Agreement shall be construed to
give any person or entity other than the parties hereto any legal or
equitable claim, right or remedy. Rather, this Agreement is intended to
be for the sole and exclusive benefit of the parties hereto.
(d) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which shall together
constitute one and the same instrument.
(e) Applicable Law. This Agreement shall be interpreted, construed, and
enforced in accordance with the laws of the State of New York, without
reference to the conflict of law thereof.
(f) Severability. If any portion of this Agreement shall be found to be
invalid or unenforceable by a court or tribunal or regulatory agency of
competent jurisdiction, the remainder shall not be affected thereby, but
shall have the same force and effect as of the invalid or unenforceable
portion had not been inserted.
(g) Entire Agreement. This Agreement, including the attachments hereto,
constitutes the entire agreement between the parties with respect to the
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matters dealt with herein, and supersedes all previous agreements, written or
oral, with respect to such matters.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ALLIANZ LIFE INSURANCE COMPANY OF BLACKROCK ADVISORS, LLC.
NORTH AMERICA
By: /s/ Xxxx Xxxxxx By: /s/ Xxxx Xxxxxxxx
Name: Xxxx Xxxxxx Name: Xxxx Xxxxxxxx
Title: Vice President Title: Vice President
Date: 4/30/08 Date: May 1, 2008
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SCHEDULE A
ADMINISTRATIVE SERVICES FOR THE FUND
MAINTENANCE OF BOOKS AND RECORDS
o MAINTAINING AN INVENTORY OF SHARE PURCHASES TO ASSIST TRANSFER AGENT IN
RECORDING ISSUANCE OF SHARES.
o PERFORMING MISCELLANEOUS ACCOUNTING SERVICES TO ASSIST TRANSFER AGENT IN
RECORDING TRANSFERS OF SHARES (VIA NET PURCHASE ORDERS).
o RECONCILIATION AND BALANCING OF THE SEPARATE ACCOUNT AT THE FUND LEVEL
IN THE GENERAL LEDGER AND RECONCILIATION OF CASH ACCOUNTS AT GENERAL
ACCOUNT LEVEL.
PURCHASE ORDERS
o DETERMINATION OF NET AMOUNT OF CASH FLOW INTO FUND.
o RECONCILIATION AND DEPOSIT OF RECEIPTS AT FUND AND CONFIRMATION THEREOF.
REDEMPTION ORDERS
REDEMPTION ORDERS
o DETERMINATION OF NET AMOUNT REQUIRED FOR REDEMPTIONS BY FUND.
o NOTIFICATION TO FUND OF CASH REQUIRED TO MEET PAYMENTS.
o COST OF SHARE REDEMPTIONS.
REPORTS
o PERIODIC INFORMATION REPORTING TO THE FUND.
FUND-RELATED CONTRACT OWNER SERVICES
o TELEPHONIC SUPPORT FOR CONTRACT OWNERS WITH RESPECT TO INQUIRIES ABOUT
THE FUND (NOT INCLUDING INFORMATION ABOUT PERFORMANCE OR RELATED TO
SALES.)
OTHER ADMINISTRATIVE SUPPORT
o OPERATIONAL AND RECORD-KEEPING SERVICES.
o PROVIDING OTHER ADMINISTRATIVE SUPPORT TO THE FUND AS MUTUALLY AGREED
BETWEEN THE INSURER AND THE FUND.
o RELIEVING THE FUND OF OTHER USUAL OR INCIDENTAL ADMINISTRATIVE SERVICES
PROVIDED TO INDIVIDUAL CONTRACT OWNERS.
o PREPARATION OF REPORTS TO CERTAIN THIRD-PARTY REPORTING SERVICES.
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