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EXHIBIT 8(vi)(B)
__________, 1999
XXXXX
XXXXX
American General Annuity Insurance Company
0000 Xxxxx Xxxxxxx
Xxxxxxx, XX 00000
Dear XXXX:
The following constitutes a letter of understanding (the "Agreement")
whereby OppenheimerFunds, Inc. ("OFI") intends to compensate American General
Annuity Insurance Company ("American General") for providing the administrative
support services described in Schedule A hereto, which is made a part hereof, to
contract owners of any American General variable annuity and/or variable life
insurance product described in Schedule C hereto, which is made a part hereof
("American General Products") that are indirect shareholders of Xxxxxxxxxxx
Variable Account Funds ("OVAF"), a series investment company dedicated to
insurance company separate accounts for which OFI acts as investment manager.
This Agreement will be effective as of December 1, 1999. All other
terms and conditions of this Agreement are described in Schedule C hereto, which
is made a part hereof.
We look forward to a long and prosperous relationship. If this Agreement
meets with your approval, please have the enclosed duplicate copy of this letter
signed on behalf of American General, and return it to my attention.
Sincerely,
Xxxxxxx F.X. Xxxxx
Title: Vice President,
OppenheimerFunds, Inc.
Agreed to and accepted on behalf of
American General Life Insurance Company
By:
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Title:
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SCHEDULE A TO
DECEMBER 1, 1999 LETTER AGREEMENT
BY AND BETWEEN
AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AND
OPPENHEIMERFUNDS, INC. (THE "AGREEMENT")
Maintenance of Books and Records
Assist as necessary to maintain book entry records on behalf of the
Funds regarding issuance to, transfer within (via net purchase orders)
and redemption by the Accounts of Fund shares. Maintain general ledgers
regarding the Accounts' holdings of Fund shares, coordinate and
reconcile information, and coordinate maintenance of ledgers by
financial institutions and other contract owner service providers.
Communication with the Funds
Serve as the designee of the Funds for receipt of purchase and
redemption orders from the Account and to transmit such orders, and
payment therefor, to the Funds. Coordinate with the Funds' agents
respecting daily valuation of the Funds' shares and the Accounts'
units.
Purchase Orders
-- Determine net amount available for investment in the Funds.
-- Deposit receipts at the Funds or the Funds' custodian
(generally by wire transfer).
-- Notify the Funds of the estimated amount required to pay
dividend or distribution.
Redemption Orders
-- Determine net amount required for redemption by the Funds.
Notify the custodian and Funds of cash required to meet
payments.
Purchase and redeem shares of the Funds on behalf of the Accounts at
the then current price in accordance with the terms of each Fund's then
current prospectus.
Assistance in enforcing procedures adopted on behalf of the
Trust to reduce, discourage, or eliminate market timing
transactions in a Fund's shares in order to reduce or
eliminate adverse effects on the Fund or its shareholders.
Processing Distributions from the Funds
Process ordinary dividends and capital gains.
Reinvest the Funds' distributions.
Reports
Periodic information reporting to the Funds, including, but not limited
to, furnishing registration statements, prospectuses, statements of
additional information, reports, solicitations for voting instructions,
and any other SEC filings with respect to the Accounts invested in the
Funds, as not otherwise provided for.
Periodic information reporting about the Funds, including any necessary
delivery of the Funds' prospectus and annual and semi-annual reports to
contract owners, as not otherwise provided for.
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Fund-related Contract Owner Services
Maintain adequate fidelity bond or similar coverage for all Company
officers, employees, investment advisors and other individuals or
entities controlled by the Company who deal with the money and/or
securities of the Funds.
Provide general information with respect to Fund inquiries (not
including information about performance or related to sales). Provide
information regarding performance of the Funds and the subaccounts of
the Accounts to existing contract owners.
Oversee and assist the solicitation, counting and voting or contract
owner voting interests in the Funds pursuant to Fund proxy statements.
Other Administrative Support
Provide other administrative and legal compliance support for the Funds
as mutually agreed upon by the Company and the Funds or the Fund
Administrator. Relieve the Funds of other usual or incidental
administrative services provided to individual contract owners.
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SCHEDULE B TO
DECEMBER 1, 1999 LETTER AGREEMENT
BY AND BETWEEN
AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AND
OPPENHEIMERFUNDS, INC. (THE "AGREEMENT")
Separate Accounts Products
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SCHEDULE C TO
DECEMBER 1, 1999 LETTER AGREEMENT
BY AND BETWEEN
AMERICAN GENERAL ANNUITY INSURANCE COMPANY
AND
OPPENHEIMERFUNDS, INC. (THE "AGREEMENT")
1. The Agreement may be cancelled by any party upon ten days of written
notice: (1) if the participation agreement for American General Products between
OFI, American General and OVAF is terminated; (2) if neither American General
nor any underwriter under its control actively promotes American General
Products with OVAF as underlying options to new investors; (3) if either party
is subject to a change of control; or (4) if it is not permissible to continue
this Agreement under laws, rules or regulations applicable to OVAF, OFI or
American General. Either party may also cancel this Agreement upon six months
written notice.
2. Payment will be made to American General quarterly during the term
this Agreement is in effect, no later than thirty days after the end of the
quarter starting with the quarter ending December 31, 1999. Payments shall be
separately computed on the average net assets of OVAF held by American General
Products variable account during the prior quarter, subject to a limit of
one-third of the average management fee paid by that OVAF series to OFI during
the prior quarter, subject to a limit of one-third of the average management fee
paid by that series to OFI during the prior quarter, at the annual rate of:.
For purposes of determining whether the breakpoint described in the preceding
sentence has been achieved, the net asset value of OVAF shares held by separate
accounts of American General Life Insurance Company will be aggregated with
shares held by American General.
3. Except to the extent that American General's, OFI's or OVAF's
counsel may deem it necessary or advisable to disclose in their respective
prospectuses or elsewhere, the terms of this Agreement will be held confidential
by each party. The party making such disclosure shall provide advance written
notification, including particulars, to the other party that it is making such
disclosure.
4. No other fees or expenses will be required of OFI or OVAF for the
sponsorship within American General product line, except as mutually agreed to
by the parties.
5. On advance written notice, OFI or a subsidiary may pay all or a
portion of the fees provided for in this Agreement under any service fee or Rule
12b-1 plan hereafter adopted by OVAF, which shall satisfy that portion of OFI's
payment obligation hereunder.
6. OFI will be responsible for calculating the fees payable hereunder.
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7. Each party shall provide each other party or its designated agent
reasonable access to its records to permit it to audit or review the accuracy of
the charges submitted for payment under this Agreement.
8. This Agreement does not modify or replace the November 23, 1998
Agreement by and between American General Annuity Insurance Company and OFI (the
"1998 Agreement"), or any other agreement with American General Life Insurance
Company pertaining to any Xxxxxxxxxxx fund other than OVAF. The parties hereto
agree that OVAF assets that qualify for payment under the 1998 Agreement shall
not qualify for payment under this Agreement.
