EXHIBIT (h)(21)(a)
AMENDED AND RESTATED
ADMINISTRATIVE SERVICES AGREEMENT
THE UNITED STATES LIFE INSURANCE COMPANY IN THE CITY OF NEW YORK ("INSURER")
and A I M ADVISORS, INC. ("AIM") (collectively, the "Parties") mutually agree
to the arrangements set forth in this Amended and Restated Administrative
Services Agreement (the "Agreement") dated as of April 1, 2004.
WHEREAS, AIM is the investment adviser to AIM Variable Insurance Funds (the
"Fund"); and
WHEREAS, AIM has entered into an amended Master Administrative Services
Agreement, dated July 1, 2003, as amended, with the Fund ("Master Agreement")
pursuant to which it has agreed to provide, or arrange to provide, certain
administrative services, including such services as may be requested by the
Fund's Board of Directors from time to time; and
WHEREAS, INSURER issues variable life insurance policies and/or variable
annuity contracts (collectively, the "Contracts"); and
WHEREAS, INSURER has entered into a participation agreement, dated
August 31, 1999 ("Participation Agreement") with the Fund, pursuant to which
the Fund has agreed to make shares of certain of its portfolios ("Portfolios")
available for purchase by one or more of INSURER's separate accounts or
divisions thereof (each, a "Separate Account"), in connection with the
allocation by Contract owners of purchase payments to corresponding investment
options offered under the Contracts; and
WHEREAS, INSURER and AIM expect that the Fund, and its Portfolios, can
derive substantial savings in administrative expenses by virtue of having one
or more Separate Accounts of INSURER each as a single shareholder of record of
Portfolio shares, rather than having numerous public shareholders of such
shares; and
WHEREAS, INSURER and AIM expect that the Fund, and its Portfolios, can
derive such substantial savings because INSURER performs the administrative
services listed on Schedule A hereto for the Fund in connection with the
Contracts issued by INSURER; and
WHEREAS, INSURER has no contractual or other legal obligation to perform
such administrative services, other than pursuant to this Agreement and the
Participation Agreement; and
WHEREAS, INSURER desires to be compensated for providing such administrative
services; and
1
WHEREAS, AIM desires that the Fund benefit from the lower administrative
expenses resulting from the administrative services performed by INSURER; and
WHEREAS, AIM desires to retain the administrative services of INSURER and to
compensate INSURER for providing such administrative services;
NOW, THEREFORE, the Parties agree as follows:
Section 1. Administrative Services; Payments Therefor.
(a) INSURER shall provide the administrative services set out in Schedule A
hereto and made a part hereof, as the same may be amended from time to time.
For such services, AIM agrees to pay to INSURER a quarterly fee ("Quarterly
Fee") equal to a percentage of the average daily net assets of the Fund
attributable to any Contracts issued by INSURER ("INSURER Fund Assets") at the
following annual rate:
Annual Rate
____%
(b) AIM shall calculate the Quarterly Fee at the end of each calendar
quarter and will make such payment to INSURER, without demand or notice by
INSURER, within 30 days thereafter, in a manner mutually agreed upon by the
Parties from time to time.
(c) From time to time, the Parties shall review the Quarterly Fee to
determine whether it exceeds or is reasonably expected to exceed the incurred
and anticipated costs, over time, of INSURER. The Parties agree to negotiate in
good faith a reduction to the Quarterly Fee as necessary to eliminate any such
excess or as necessary to reflect a reduction in the fee paid by the Fund to
AIM pursuant to the Master Agreement.
Section 2. Nature of Payments.
The Parties to this Agreement recognize and agree that AIM's payments
hereunder 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 Portfolio shares, and are not otherwise related to investment
advisory or distribution services or expenses. INSURER represents and warrants
that the fees to be paid by AIM for services to be rendered by INSURER pursuant
to the terms of this Agreement are to compensate the INSURER for providing
administrative services to the Fund, and are not designed to reimburse or
compensate INSURER for providing administrative services with respect to the
Contracts or any Separate Account.
Section 3. Term and Termination.
Any Party may terminate this Agreement, without penalty, on 60 days written
notice to the other Party. Unless so terminated, this Agreement shall continue
in effect for so long as AIM or its successor(s) in interest, or any affiliate
thereof, continues to perform in a similar capacity for the
2
Fund, and for so long as INSURER provides the services contemplated hereunder
with respect to Contracts under which values or monies are allocated to a
Portfolio.
Section 4. Amendment.
This Agreement may be amended upon mutual agreement of the Parties in
writing.
Section 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
The United States Life Insurance Company in the City of New York
0000 Xxxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxx, Esquire
A I M Advisors, Inc.
00 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxxxx, Esquire
Section 6. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be binding upon the Parties
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 any 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, as well as the Fund, any
legal or equitable claim, right or remedy. Rather, this Agreement is intended
to be for the sole and exclusive benefit of the Parties, as well as the Fund.
(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 Delaware without reference
to the conflict of law principles 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
3
shall not be affected thereby, but shall have the same force and effect as if
the invalid or unenforceable portion had not been inserted.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
of first above written.
THE UNITED STATES LIFE INSURANCE
COMPANY IN THE CITY OF NEW YORK
By:
------------------------------
Title:
------------------------------
A I M ADVISORS, INC.
By:
------------------------------
Title:
------------------------------
[Corporate Seal]
Attest:
--------------------------
The United States Life Insurance
Company in the City of New York
Name:
--------------------------
Title:
--------------------------
4
SCHEDULE A
ADMINISTRATIVE SERVICES FOR
AIM VARIABLE INSURANCE FUNDS
INSURER shall provide certain administrative services respecting the
operations of the Fund, as set forth below. This Schedule, which may be amended
from time to time as mutually agreed upon by INSURER and AIM, constitutes an
integral part of the Agreement to which it is attached. Capitalized terms used
herein shall, unless otherwise noted, have the same meaning as the defined
terms in the Agreement to which this Schedule relates.
A. Records of Portfolio Share Transactions; Miscellaneous Records
1. INSURER shall maintain master accounts with the Fund, on behalf of each
Portfolio, which accounts shall bear the name of INSURER as the record owner of
Portfolio shares on behalf of each Separate Account investing in the Portfolio.
2. INSURER shall maintain a daily journal setting out the number of shares
of each Portfolio purchased, redeemed or exchanged by Contract owners each day,
as well as the net purchase or redemption orders for Portfolio shares submitted
each day, to assist AIM, the Fund and/or the Fund's transfer agent in tracking
and recording Portfolio share transactions, and to facilitate the computation
of each Portfolio's net asset value per share. INSURER shall promptly provide
AIM, the Fund, and the Fund's transfer agent with a copy of such journal
entries or information appearing thereon in such format as may be reasonably
requested from time to time. INSURER shall provide such other assistance to
AIM, the Fund, and the Fund's transfer agent as may be necessary to cause
various Portfolio share transactions effected by Contract owners to be properly
reflected on the books and records of the Fund.
3. In addition to the foregoing records, and without limitation, INSURER
shall maintain and preserve all records as required by law to be maintained and
preserved in connection with providing administrative services hereunder.
B. Order Placement and Payment
1. INSURER shall determine the net amount to be transmitted to the Separate
Accounts as a result of redemptions of each Portfolio's shares based on
Contract owner redemption requests and shall disburse or credit to the Separate
Accounts all proceeds of redemptions of Portfolio shares. INSURER shall notify
the Fund of the cash required to meet redemption payments.
2. INSURER shall determine the net amount to be transmitted to the Fund as a
result of purchases of Portfolio shares based on Contract owner purchase
payments and transfers allocated to the Separate Accounts investing in each
Portfolio. INSURER shall transmit net purchase payments to the Fund's custodian.
5
C. Accounting Services
INSURER shall perform miscellaneous accounting services as may be reasonably
requested from time to time by AIM, which services shall relate to the business
contemplated by the Participation Agreement between INSURER and the Fund, as
amended from time to time. Such services shall include, without limitation,
periodic reconciliation and balancing of INSURER's books and records with those
of the Fund with respect to such matters as cash accounts, Portfolio share
purchase and redemption orders placed with the Fund, dividend and distribution
payments by the Fund, and such other accounting matters that may arise from
time to time in connection with the operations of the Fund as related to the
business contemplated by the Participation Agreement.
D. Reports
INSURER acknowledges that AIM may, from time to time, be called upon by the
Fund's Board of Trustees ("Board"), to provide various types of information
pertaining to the operations of the Fund and related matters, and that AIM also
may, from time to time, decide to provide such information to the Board in its
own discretion. Accordingly, INSURER agrees to provide AIM with such assistance
as AIM may reasonably request so that AIM can report such information to the
Fund's Board in a timely manner. INSURER acknowledges that such information and
assistance shall be in addition to the information and assistance required of
INSURER pursuant to the Fund's mixed and shared funding SEC exemptive order,
described in the Participation Agreement.
INSURER further agrees to provide AIM with such assistance as AIM may
reasonably request with respect to the preparation and submission of reports
and other documents pertaining to the Fund to appropriate regulatory bodies and
third party reporting services.
E. Fund-related Contract Owner Services
INSURER agrees to print and distribute, in a timely manner, prospectuses,
statements of additional information, supplements thereto, periodic reports and
any other materials of the Fund required by law or otherwise to be given to its
shareholders, including, without limitation, Contract owners investing in
Portfolio shares. INSURER further agrees to provide telephonic support for
Contract owners, including, without limitation, advice with respect to
inquiries about the Fund and each Portfolio thereof (not including information
about performance or related to sales), communicating with Contract owners
about Fund (and Separate Account) performance, and assisting with proxy
solicitations, specifically with respect to soliciting voting instructions from
Contract owners.
F. Miscellaneous Services
INSURER shall provide such other administrative support to the Fund as
mutually agreed between INSURER and AIM or the Fund from time to time. INSURER
shall, from time to time, relieve the Fund of other usual or incidental
administration services of the type ordinarily borne by mutual funds that offer
shares to individual members of the general public.
6
