EXHIBIT (H)(3)(B)
AMENDMENT NO. 2 TO SHAREHOLDER SERVICES AGREEMENT
THIS AMENDMENT NO. 2 TO SHAREHOLDER SERVICES AGREEMENT is effective as
of the 31st day of December, 2010, by and among THE UNITED STATES LIFE INSURANCE
COMPANY IN THE CITY OF NEW YORK (the "Company") and AMERICAN CENTURY INVESTMENT
SERVICES, INC. ("Distributor"). Capitalized terms not otherwise defined herein
shall have the meaning ascribed to them in the Agreement (defined below).
RECITALS
WHEREAS, the Company and the Distributor are parties to a certain
Shareholder Services Agreement dated October 2, 2000 (the "Agreement") in
connection with the participation by the Funds (as defined in the Agreement) in
individual and group variable annuity and variable life insurance contracts to
be issued through one or more separate accounts established by the Company under
state law;
WHEREAS, the parties desire to expand the number of Funds to be made
available as investment options under the Contracts;
WHEREAS, in connection with the expansion of Funds, the parties have
agreed to revise the compensation terms as set forth herein;
WHEREAS, the parties desire to expand the separate accounts of the
Company to serve as investment vehicles for the Contracts;
WHEREAS, in connection with the expansion of Funds available under the
Agreement, the parties agree to revise the termination and assignment provisions
as stated herein; and
WHEREAS, the parties now desire to modify the Agreement as provided
herein.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the parties hereto agree as follows:
1. The second WHEREAS clause is hereby deleted in its entirety
and replaced with the following:
"WHEREAS, the Company wishes to make available as
investment options under the Contracts Class I of the VP
Balanced Fund, VP Capital Appreciation Fund, VP Income &
Growth Fund, VP International Fund, VP Value Fund and Class II
of the VP Inflation Protection Fund (collectively, the
"Funds"), each of which is a series of mutual fund shares
registered under the Investment Company Act of 1940, as
amended and issued by American Century Variable Portfolios,
Inc., except for Class II of the VP Inflation Protection Fund,
which is issued by American Century Variable Portfolios II,
Inc. (collectively referred to as the "Issuer"); and"
2. Sections 6(b) and 6(c) are hereby deleted in their entirety
and the following sections are substituted in lieu thereof:
"(b) Distributor acknowledges that it will derive a
substantial savings in administrative expenses, such as a
reduction in expenses related to postage, shareholder
communications and recordkeeping, by virtue of having a single
shareholder account per Fund for the Accounts rather than
having each Contract owner as a shareholder. In consideration
of the Administrative Services and performance of all other
obligations under this Agreement by the Company, Distributor
will pay the Company a fee (the "Administrative Services Fee")
equal to __ basis points (____%) per annum of the average
aggregate amount invested by the Company in Class I shares of
the Funds and __ basis points (____%) per annum of the average
aggregate amount invested in Class II shares of the VP
Inflation Protection Fund under this Agreement. The payments
received by the Company do not constitute payment in any
manner for investment advisory services.
"(c) In consideration of performance of the
Distribution Services specified on EXHIBIT B by the Company,
Distributor will pay the Company a fee (the "Distribution
Fee") of __ basis points (____%) of the average aggregate
amount invested by the Company in Class II shares of the VP
Inflation Protection Fund under this Agreement."
3. Section 7(a)(ii) is hereby deleted in its entirety and
replaced with the following:
"(ii) it has established Separate Accounts USL VL-R,
USL VA-R and USL B (the "Accounts"), each of which is a duly
authorized and established separate account under New York
Insurance Law, and has registered each Account as a unit
investment trust under the Investment Company Act of 1940 (the
"1940 Act") to serve as an investment vehicle for the
Contracts;"
4. The first paragraph of Section 13 is hereby deleted in its
entirety and the following paragraph is substituted in lieu thereof:
"13. TERMINATION; WITHDRAWAL OF OFFERING. This
Agreement may be terminated by any party upon 180 days' prior
written notice to the other party, or, on 60 days' written
notice pursuant to a vote of a majority of the outstanding
securities of the Funds. Notwithstanding the above, the Issuer
reserves the right, without prior notice, to suspend sales of
shares of any Fund, in whole or in part, or to make a limited
offering of shares of any of the Funds in the event that (A)
any regulatory body commences formal proceedings against the
Company, Distributor or the Issuer, which
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proceedings Distributor reasonably believes may have a
material adverse impact on the ability of the Issuer or the
Company to perform its obligations under this Agreement or (B)
in the judgment of Distributor, declining to accept any
additional instructions for the purchase or sale of shares of
any such Fund is warranted by market, economic or political
conditions. Notwithstanding the foregoing, this Agreement may
be terminated immediately (i) by any party as a result of any
other breach of this Agreement by another party, which breach
is not cured within 30 days after receipt of notice from the
other party, or (ii) by any party upon a determination that
continuing to perform under this Agreement would, in the
reasonable opinion of the terminating party's counsel, violate
any applicable federal or state law, rule, regulation or
judicial order, (iii) by a vote of a majority of the
independent directors, or (iv) upon assignment by either
party."
5. Section 18 is hereby deleted in its entirety and the following
Section 18 is substituted in lieu thereof:
"18. SUCCESSORS AND ASSIGNS. This Agreement may not
be assigned and will be terminated automatically upon any
attempted assignment. This Agreement shall be binding upon and
inure to the benefit of both parties hereto."
6. In the event of a conflict between the terms of this Amendment
No. 2 and the Agreement, it is the intention of the parties that the terms of
this Amendment No. 2 shall control and the Agreement shall be interpreted on
that basis. To the extent the provisions of the Agreement have not been amended
by this Amendment No. 2, the parties hereby confirm and ratify the Agreement.
7. This Amendment No. 2 may be executed in two or more
counterparts, each of which shall be an original and all of which together shall
constitute one instrument.
8. Except as expressly supplemented, amended or consented to
hereby, all of the representations, warranties, terms, covenants and conditions
of the Agreement shall remain unamended and shall continue to be in full force
and effect.
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 2
as of the date first above written.
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THE UNITED STATES LIFE INSURANCE AMERICAN CENTURY INVESTMENT SERVICES,
COMPANY IN THE CITY OF NEW YORK INC.
By: By:
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Name: Name:
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Title: Title:
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Attest:
By:
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Name:
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Title:
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[CORPORATE SEAL]
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EXHIBIT B
DISTRIBUTION SERVICES
Pursuant to the Agreement to which this is attached, the Company shall perform
distribution services for Class II shares of the Funds, including, but not
limited to, the following:
1. Receive and answer correspondence from prospective shareholders,
including distributing prospectuses, statements of additional
information, and shareholder reports.
2. Provide facilities to answer questions from prospective investors about
Fund shares.
3. Assist investors in completing application forms and selecting dividend
and other account options.
4. Provide other reasonable assistance in connection with the distribution
of Fund shares.
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