1
EXHIBIT (8)(e)(3)
AMENDMENT NO. 2 TO FUND PARTICIPATION AGREEMENT
THIS AMENDMENT NO. 2 TO FUND PARTICIPATION AGREEMENT (the "Amendment")
is effective as of January 1, 2000, by and among THE VARIABLE ANNUITY LIFE
INSURANCE COMPANY (the "Company"), AMERICAN CENTURY MUTUAL FUNDS, INC (the
"Issuer") and AMERICAN CENTURY INVESTMENT MANAGEMENT, INC. ("ACIM"). Capitalized
terms not otherwise defined herein shall have the meaning ascribed to them in
the Agreement (defined below).
RECITALS
WHEREAS, the Company, Issuer and ACIM are parties to that certain Fund
Participation Agreement dated April 30, 1996, as amended December 8, 1997 (the
"Agreement") in connection with the participation by the Funds in Contracts
offered by the Company; and
WHEREAS, the parties wish to amend the Agreement to provide a change in
reimbursement for shareholder services as provided herein.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the Company, Issuer and ACIM agree as follows:
1. Change in Applicable Fee. Based on its understanding that the
Company will be adding approximately $200 million to the assets managed by ACIM
for the Company as of July 1, 2000, ACIM has agreed to raise the amount of the
Administrative Services Fee effective as of January 1, 2000. If the Company
fails to add the additional assets, however, beginning July 15, 2000 the
Administrative Services Fee shall revert to that in effect as of December 31,
1999. Exhibit A to the Agreement is hereby deleted in its entirety and replaced
with Exhibit A attached hereto.
2. Ratification and Confirmation of Agreement. In the event of a
conflict between the terms of this Amendment and the Agreement, it is the
intention of the parties that the terms of this Amendment 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, the parties hereby
confirm and ratify the Agreement.
3. Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be an original and all of which together shall
constitute one instrument.
4. Full Force and Effect. 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.
2
IN WITNESS WHEREOF, the undersigned have executed this Amendment No. 2
as of the date first above written.
THE VARIABLE ANNUITY LIFE AMERICAN CENTURY INVESTMENT
INSURANCE COMPANY MANAGEMENT, INC.
By: /s/ XXXXX X. XXXX By: /s/ XXXXXXX X. XXXXX
----------------------------------- --------------------------------
Name: Xxxxx X. Xxxx Name: Xxxxxxx X. Xxxxx
Title: AG Fund Group, President Title: Executive Vice President
VALIC, EVP
AMERICAN CENTURY MUTUAL
FUNDS, INC.
By: /s/ XXXXXXX X. XXXXXXXXXXX
----------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Assistant Vice President
3
EXHIBIT A
FUNDS AVAILABLE AND APPLICABLE FEE
--------------------------------------------------------------------------------
ISSUER NAME OF FUND APPLICABLE FEE*
--------------------------------------------------------------------------------
American Century Mutual Funds, Ultra
Inc.
--------------------------------------------------------------------------------
* Subject to Section 5 of the Agreement
** Basis Points
NOTE: If the Company fails to have ACIM begin managing an additional $200
million in new assets in May, 2000, as of July 15, 2000, the applicable
fee will be:
Assets > 0 but < $75 million, 20 BPs (0.20%); Assets $75 million,
25 BPs (0.25%).
4
EXHIBIT C
1. DISTRIBUTOR or FUND will pay VALIC the following asset-based Services Fee
computed daily and payable quarterly on the aggregate net asset value of the
shares of each FUND maintained in accounts established with the FUND by VALIC:
12b-1 Fee
Fund Per Annum
---- ---------
Founders Growth Fund
---------
2. ADVISER or FUND will pay VALIC the following asset-based administrative
services fee computed daily and payable quarterly on the average net asset value
of the shares of each FUND maintained in accounts established with the FUND by
VALIC, except that the fee for the initial term (July 1 to December 31, 1999)
may be paid as a lump sum:
Administrative Services
Fund Fee Per Annum
---- -------------
Founders Growth Fund
---------
VALIC shall provide ADVISER with the number of contracts owners for whose
benefit FUND shares are held in such accounts as of the end of each month as
well as such other documentation as ADVISER may reasonably request in order to
permit ADVISER to convert the asset-based administrative services fee to a per
participant fee for its internal purposes.
All payments to VALIC shall be remitted to the following address:
0000 Xxxxx Xxxxxxx, X0-00
Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxx
