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EXHIBIT 8(k)(ii)
AGREEMENT
THIS AGREEMENT ("Agreement") made as of November 1, 2000, is by and between SIT
INVESTMENT ASSOCIATES, INC., a Minnesota corporation ("Adviser") and THE
VARIABLE ANNUITY LIFE INSURANCE COMPANY, a Texas corporation ("VALIC").
WITNESSETH:
WHEREAS, each of the investment companies listed on Schedule One hereto
("Schedule One," as the same may be amended from time to time), is registered as
an open-end management investment company under the Investment Company Act of
1940, as amended (the "Act") (such investment companies are hereinafter
collectively called the "Funds," or each a "Fund"); and
WHEREAS, each of the Funds is available as an investment vehicle for VALIC for
its separate account to fund variable annuity contracts ("Contracts") listed on
Schedule Two hereto ("Schedule Two," as the same may be amended from time to
time); and
WHEREAS, VALIC has entered into a participation agreement dated November 1,
2000, among VALIC, the Funds, and the Funds' underwriter (the "Participation
Agreement," as the same may be amended from time to time); and
WHEREAS, Adviser provides, among other things, investment advisory and/or
administrative services to the Funds; and
WHEREAS, Adviser desires VALIC to provide the administrative services specified
in the attached Exhibit A ("Administrative Services"), in connection with the
Contracts for the benefit of persons who maintain their ownership interests in
the separate account, whose interests are included in the master account
("Master Account") referred to in paragraph 1 of Exhibit A ("Shareholders"), and
VALIC is willing and able to provide such Administrative Services on the terms
and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
hereinafter contained, each party hereto severally agrees as follows:
1. VALIC agrees to perform the Administrative Services specified in Exhibit A
hereto for the benefit of the Shareholders.
2. VALIC represents and agrees that it will maintain and preserve all records
as required by law to be maintained and preserved in connection with
providing the Administrative Services, and will otherwise comply with all
laws, rules and regulations applicable to the Administrative Services.
3. VALIC agrees to provide copies of all the historical records relating to
transactions between the Funds and Shareholders, and all written
communications and other related
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materials regarding the Fund(s) to or from such Shareholders, as reasonably
requested by Adviser or its representatives (which representatives,
include, without limitation, its auditors, legal counsel or the
Underwriter, as the case may be), to enable Adviser or its representatives
to monitor and review the Administrative Services performed by VALIC, or
comply with any request of the board of directors, or trustees or general
partners (collectively, the "Directors") of any Fund, or of a governmental
body, self-regulatory organization or Shareholder.
In addition, VALIC agrees that it will permit Adviser, the Funds or their
representatives, to have reasonable access to its personnel and records in
order to facilitate the monitoring of the quality of the Administrative
Services.
4. VALIC may, with the consent of Adviser, contract with or establish
relationships with other parties for the provision of the Administrative
Services or other activities of VALIC required by this Agreement, or the
Participation Agreement, provided that VALIC shall be fully responsible for
the acts and omissions of such other parties.
5. VALIC hereby agrees to notify Adviser promptly if for any reason it is
unable to perform fully and promptly any of its obligations under this
Agreement.
6. VALIC hereby represents and covenants that it does not, and will not, own
or hold or control with power to vote any shares of the Funds which are
registered in the name of VALIC or the name of its nominee and which are
maintained in VALIC variable annuity or variable life insurance accounts.
VALIC represents further that it is not registered as a broker-dealer under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), and it is
not required to be so registered, including as a result of entering into
this Agreement and performing the Administrative Services, and other
obligations of VALIC set forth in this Agreement.
7. The provisions of the Agreement shall in no way limit the authority of
Adviser, or any Fund or Underwriter to take such action as any of such
parties may deem appropriate or advisable in connection with all matters
relating to the operations of any of such Funds and/or sale of its shares.
8. In consideration of the performance of the Administrative Services by
VALIC, beginning on the date hereof, Adviser agrees to pay VALIC a
quarterly amount that is equal on an annual basis to _______________ basis
points (____%) of the average daily net assets of the Fund held in the
Contracts. The foregoing fee will be paid by Adviser to VALIC within
20 days of the end of each calendar quarter, without demand or notice
by VALIC.
Notwithstanding anything in this Agreement or the Participation Agreement
appearing to the contrary, the payments by Adviser to VALIC relate solely
to the performance by VALIC of the Administrative Services described herein
only, and do not constitute payment in any manner for services provided by
VALIC to VALIC policy or contract owners, or to any separate account
organized by VALIC, or for any investment advisory services, or for costs
associated with the distribution of any variable annuity or variable life
insurance contracts.
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9. VALIC shall indemnify and hold harmless each of the Funds, Adviser and
Underwriter and each of their respective officers, Directors, employees and
agents from and against any and all losses, claims, damages, expenses, or
liabilities that any one or more of them may incur including without
limitation reasonable attorneys' fees, expenses and costs arising out of or
related to the performance or non-performance by VALIC of the
Administrative Services under this Agreement.
10 This Agreement may be terminated without penalty at any time by VALIC or by
Adviser as to one or more of the Funds collectively, upon one hundred and
eighty days (180) written notice to the other party. Notwithstanding the
foregoing, the provisions of paragraphs 2, 3, 9 and 11 of this Agreement,
shall continue in full force and effect after termination of this
Agreement.
This Agreement shall not require VALIC to preserve any records (in any
medium or format) relating to this Agreement beyond the time periods
otherwise required by the laws to which VALIC or the Funds are subject
provided that such records shall be offered to the Funds in the event VALIC
decides to no longer preserve such records following such time periods.
11. After the date of any termination of this Agreement in accordance with
paragraph 10 of this Agreement, no fee will be due with respect to any
amounts in the Contracts first placed in the Master Account for the benefit
of Shareholders after the date of such termination. However,
notwithstanding any such termination, Adviser will remain obligated to pay
VALIC the fee specified in paragraph 8 of this Agreement, with respect to
the value of each Fund's average daily net assets maintained in the Master
Account with respect to the Contracts as of the date of such termination,
for so long as such amounts are held in the Master Account and VALIC
continues to provide the Administrative Services with respect to such
amounts in conformity with this Agreement. This Agreement, or any provision
hereof, shall survive termination to the extent necessary for each party to
perform its obligations with respect to amounts for which a fee continues
to be due subsequent to such termination.
12. VALIC understands and agrees that the obligations of Adviser under this
Agreement are not binding upon any of the Funds, upon any of their Board
members or upon any shareholder of any of the Funds.
13. It is understood and agreed that in performing the services under this
Agreement VALIC, acting in its capacity described herein, shall at no time
be acting as an agent for Adviser, Underwriter or any of the Funds. VALIC
agrees, and agrees to cause its agents, not to make any representations
concerning a Fund except those contained in the Fund's then-current
prospectus; in current sales literature furnished by the Fund, Adviser or
Underwriter to VALIC; in the then current prospectus for a variable annuity
contract or variable life insurance policy issued by VALIC or then current
sales literature with respect to such variable annuity contract or variable
life insurance policy, approved by Adviser.
14. This Agreement, including the provisions set forth herein in paragraph 8,
may only be amended pursuant to a written instrument signed by the party to
be charged. This Agreement may not be assigned by a party hereto, by
operation of law or otherwise, without the prior written consent of the
other party.
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15. This Agreement shall be governed by the laws of the State of Texas, without
giving effect to the principles of conflicts of law of such jurisdiction.
16. This Agreement, including Exhibit A, Schedule One and Schedule Two,
constitutes the entire agreement between the parties with respect to the
matters dealt with herein and supersedes any previous agreements and
documents with respect to such matters. The parties agree that Schedule One
and/or Schedule Two may be replaced from time to time with a new Schedule
One and/or Schedule Two to accurately reflect any changes in the Funds
available as investment vehicles and/or the Contracts available, under the
Participation Agreement, respectively.
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IN WITNESS HEREOF, the parties hereto have executed and delivered this Agreement
as of the date first above written.
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
By:
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Authorized Signatory
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Print or Type Name
SIT INVESTMENT ASSOCIATES, INC.
By:
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Authorized Signatory
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Print or Type Name
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SCHEDULE ONE
INVESTMENT COMPANY NAME: FUND NAME(S):
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Sit Mutual Funds, Inc. Sit Small Cap Growth Fund (Series D)
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SCHEDULE TWO
LIST OF CONTRACTS
o Portfolio Director Series
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EXHIBIT A
Pursuant to the Agreement and the Participation Agreement by and among the
parties hereto, and subject to the requirements of the Fund's then current
prospectus and statement of additional information, VALIC shall perform the
following Administrative Services:
1. Maintain separate records for each Shareholder, which records shall reflect
shares purchased and redeemed for the benefit of the Shareholder and share
balances held for the benefit of the Shareholder. VALIC shall maintain the
Master Account with the transfer agent of the Fund on behalf of
Shareholders and such Master Account shall be in the name of VALIC or its
nominee as the record owner of the shares held for such Shareholders.
2. For each Fund, disburse or credit to Shareholders all proceeds of
redemptions of shares of the Fund and all dividends and other distributions
not reinvested in shares of the Fund or paid to the Separate Account
holding the Shareholders' interests.
3. Prepare and transmit to Shareholders periodic account statements showing
the total number of shares held for the benefit of the Shareholder as of
the statement closing date (converted to interests in the Separate
Account), purchases and redemptions of Fund shares for the benefit of the
Shareholder during the period covered by the statement, and the dividends
and other distributions paid for the benefit of the Shareholder during the
statement period (whether paid in cash or reinvested in Fund shares).
4. Transmit to Shareholders proxy materials and reports and other information
received by VALIC from any of the Funds and required to be sent to
Shareholders under the federal securities laws and, upon request of the
Fund's transfer agent, transmit to Shareholders material Fund
communications deemed by the Fund, through its Board of Directors or other
similar governing body, to be necessary and proper for receipt by all Fund
beneficial shareholders under all applicable state and federal laws.
5. Transmit to the Fund's transfer agent purchase and redemption orders on
behalf of Shareholders.
6. Provide to the Funds, or to the transfer agent for any of the Funds, or any
of the agents designated by any of them, such periodic reports as shall
reasonably be concluded to be necessary to enable each of the Funds and its
Underwriter to comply with any applicable State Blue Sky requirements and
other applicable state and federal laws.
