ADMINISTRATIVE SERVICES AGREEMENT
KANSAS
CITY LIFE INSURANCE COMPANY (“INSURER”) and A I M ADVISORS, INC. (“AIM”)
(collectively, the “Parties”) mutually agree to the arrangements set forth in
this Administrative Services Agreement (the “Agreement”) dated as of August 1,
2000.
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 May 1, 2000, 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 Trustees 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 1, 2000 (“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
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:
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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 the
Contracts issued by INSURER (“INSURER Fund Assets”) at the following annual
rates:
Annual
Rate Total Average Quarterly Net
Assets for All Portfolios
0.15% Less than $50
million
0.20% $50 million
or more
(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.
2
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 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:
Kansas
City Life Insurance Company
0000
Xxxxxxxx
Xxxxxx
Xxxx, XX 00000
Facsimile:
(000) 000-0000
Attention:
C. Xxxx Xxxxxxxxx, Esq.
A
I M Advisors, Inc.
00
Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
Xxxxx 00000
Facsimile:
(000) 000-0000
Attention:
Xxxxx X. Xxxxxx, 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.
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(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
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.
KANSAS
CITY LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx X.
Xxxx
Title: Senior
Vice President
A
I M ADVISORS, INC.
By: /s/ Xxxxxx X.
Xxxxxx
Title: President
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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.
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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 Directors (“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, proxy materials
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.
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