--------------------------------------------------------------------------------
FORM N-6, ITEM 26(h)
PARTICIPATION AGREEMENTS
--------------------------------------------------------------------------------
FUND PARTICIPATION AGREEMENT
American United Life Insurance Company (the "Company") and TCI Portfolios,
Inc. ("TCIP") and its investment adviser, Investors Research Corporation
("Investors Research") hereby agree to an arrangement whereby shares of TCI
Growth (the "Fund") shall be made available to serve as underlying investment
media for Individual and Group Annuity Contracts ("Contracts") to be offered to
the public by the Company, subject to the following provisions:
1. Establishment of Account; Availability of Fund.
The Company represents that it has established or will establish one or
more separate accounts (an "Account") under state insurance law, each of which
is or will be registered as a unit investment trust under the Investment Company
Act of 1940 (the "1940 Act"), to serve as an investment vehicle for the
Contracts. The Contracts provide for the allocation of net amounts received by
the Company to separate series of an Account for investment in the shares of a
specified investment company selected from among those companies available
through an Account to act as underlying investment media. Selection of a
particular series of an Account is made by the Contract owner, who may change
such selection from time to time in accordance with the terms of the applicable
Contract.
2. Marketing and Promotion.
The Company agrees to make every reasonable effort to market its Contracts.
It will not give disproportionately unequal emphasis and promotion to shares of
the Fund as compared to other underlying investments of an Account. In addition,
the Company shall not
2
impose any fee, condition, rule or regulation for the use by a Contract owner of
the Fund as an investment option that operates to the specific prejudice of the
Fund vis-a-vis the other investment options offered by the Company to Contract
owners. In marketing and administering its Contracts, the Company will comply
with all applicable state and Federal laws.
3. Pricing Information; Orders; Settlement.
(a) TCIP will make Fund shares available to be purchased by the Company on
behalf of an Account at the net asset value applicable to each order. Fund
shares shall be purchased and redeemed in such quantity and at such time
determined by the Company to be necessary to meet the requirements of those
Contracts for which the Fund serves as underlying investment media.
(b) TCIP will provide to the Company closing net asset value, dividend and
capital gain information at the close of trading each day that the New York
Stock Exchange (the "Exchange") is open (each such day, a "business day"). The
Company will send directly to TCIP or its specified agent orders to purchase
and/or redeem Fund shares by 10:00 a.m. Eastern Time the following business day.
Payment for net purchases will be wired by the Company to a custodial account
designated by TCIP to coincide with the order for shares of the Fund.
(c) TCIP hereby appoints the Company as its agent for the limited purpose
of accepting purchase and redemption orders for Fund shares from Contract
owners. Orders from Contract owners received by the Company acting as agent for
TCIP prior to the close of the Exchange on any given business day will be
executed by TCIP at the net asset value determined as of the close of the
Exchange on such business day. Any orders received by the
3
Company acting as agent on such day but after the close of the Exchange will be
executed by TCIP at the net asset value determined as of the close of the
Exchange on the next business day following the day of receipt of such order.
(d) Payments for net redemptions of shares of the Fund will be paid in cash
and will be wired by TCIP from the TCIP custodial account to an account
designated by the Company. Payment for net redemptions will ordinarily be wired
one business day after the order for the redemptions has been sent by the
Company to TCIP or its specified agent.
4. Compliance.
(a) In managing and administering TCIP,. TCIP and Investors Research will
comply in all material respects with all applicable state and Federal securities
laws.
(b) TCIP and Investors Research shall use their respective best efforts to
ensure that the Fund qualifies and continues to qualify as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code (or any
successor or similar provision).
(c) TCIP and Investors Research shall use their respective best efforts to
ensure that the Fund complies and maintains compliance with the diversification
provisions of Section 817(h) of the Internal Revenue Code and the regulations
issued thereunder relating to the diversification requirements for variable
annuity contracts, and with any prospective amendments or other modifications to
Section 817 or regulations thereunder.
(d) Unless it notifies the Company with reasonable promptness that it does
not intend to do so, TCIP shall take all steps necessary to adhere to any
requirements under tax or insurance law or otherwise that pertain to the Fund by
virtue of serving as an investment media for the Contracts for which notice is
provided to TCIP by the Company.
(e) Investors Research shall notify the Company with reasonable promptness
after
4
having a reasonable basis for believing that the Fund has ceased to comply or
likely will cease to comply with any of the requirements described or referenced
in Section 4(a), (b), (c), or (d) of this Agreement.
(f) TCIP and Investors Research represent and warrant that as of the date
of this Agreement the shares of the Fund are duly authorized for issuance in
accordance with applicable law, that the shares of the Fund are registered with
the Securities and Exchange Commission ("SEC") as securities under the
Securities Act of 1933 (the "1933 Act") and that TCIP is registered as an
open-end management investment company under the 1940 Act.
5. Expenses.
(a) Except as otherwise provided in this Agreement, all expenses incident
to the performance by TCIP under this Agreement shall be paid by Investors
Research or TCIP, including the cost of registration of TCIP's shares with the
SEC and in states where required.
(b) TCIP shall provide to the Company its proxy materials, periodic fund
reports to shareholders and other materials that are required by law to be sent
to Contract owners. In addition, TCIP shall provide the Company with a
sufficient quantity of its prospectuses to be used in connection with the
offerings and transactions contemplated by this Agreement. The cost of preparing
and printing such materials shall be paid by Investors Research or TCIP, and the
cost of distributing such materials shall be paid by the Company; provided,
however, that at any time TCIP reasonably deems the usage of such materials to
be excessive, it may request that the Company pay the cost of printing
(including press time and paper) of any additional copies of such materials
requested by the Company.
6. Representations.
The Company and its agents shall not, without the written consent of TCIP,
make
5
representations concerning TCIP or its shares except those contained in the then
current prospectuses, registration statement and in the then current printed
sales literature of TCIP.
7. Administration of Accounts.
(a) Administrative services to purchasers of Contracts shall be the
responsibility of the Company and shall not be the responsibility of TCIP or
Investors Research. TCIP and Investors Research recognize the Company as the
sole shareholder of TCIP shares issued under this Agreement. TCIP and Investors
Research further recognize that they will derive a substantial savings in
administrative expense, such as significant reductions in postage expense and
shareholder communications and recordkeeping, by virtue of having a sole
shareholder rather than multiple shareholders. In consideration of the
administrative savings resulting from such arrangement, Investors Research
agrees to pay to the Company an amount equal to 15 basis points (0.15%) per
annum of the average aggregate amount invested by the Company under this
Agreement, commencing with the month in which the average aggregate investment
by the Company (on behalf of the Contract owners) in the Fund exceeds $10
million. No payment obligation shall arise until the Company's average aggregate
investment in the Fund reaches $10 million, and such payment obligation, once
commenced, shall be suspended with respect to any month during which the
Company's average aggregate investment in the Fund drops below $10 million.
(b) Investors Research has advised the Company that it customarily pays,
out of its management fee, another affiliated corporation for the type of
administrative services to be provided by the Company to the Contract holders.
The parties agree that Investors Research's payments to the Company, like
Investors Research's payments to its affiliated corporation, are for
administrative services only and do not constitute payment in any manner for
investment
6
advisory services or for costs of distribution.
(c) For the purposes of computing the payment to the Company contemplated
by this Section 7, the average aggregate amount invested by the Company over a
one month period shall be computed by totaling the Company's aggregate
investment (share net asset value multiplied by total number of shares held by
the Company) on each business day during the month and dividing by the total
number of business days during such month.
(d) Investors Research will calculate the payment contemplated by this
Section 7 at the end of each calendar quarter and will make such payment to the
Company within 30 days thereafter. The check for such payment will be
accompanied by a statement showing the calculation of the monthly amounts
payable by Investors Research and such other supporting data as may be
reasonably requested by the Company.
8. Termination.
This Agreement shall terminate as to the sale and issuance of new
Contracts:
(a) at the option of either the Company or TCIP upon 90 days' advance
written notice to the other;
(b) at the option of the Company if shares of the Fund are not available
for any reason or if the Company shall reasonably determine in good faith that
further investment in shares of the Fund is inappropriate in view of the
purposes of the Contracts, provided that reasonable advance notice of election
to terminate shall be furnished by the Company;
(c) at the option of either the Company or TCIP, upon institution of formal
proceedings against the broker-dealer or broker-dealers underwriting the
Contracts, the Account, the Company, Investors Research or TCIP by the National
Association of Securities Dealers, Inc. (the "NASD"), the SEC or any other
regulatory body;
7
(d) at the option of TCIP, if TCIP shall reasonably determine in good faith
that the Company is not offering shares of the Fund in conformity with the terms
of this Agreement;
(e) upon termination of the Management Agreement between TCIP and Investors
Research, notice of which shall be promptly furnished to the Company; provided,
however, that this subsection (e) shall not apply if contemporaneously with such
termination a new contract of substantially similar terms is entered into
between TCIP and Investors Research;
(f) upon the requisite vote of Contract owners having an interest in the
Fund to substitute for Fund shares the shares of another investment company in
accordance with the terms of Contracts for which Fund shares had been selected
to serve as an underlying investment medium; provided, however, that the Company
shall give 60 days' written notice to TCIP of any proposed vote to replace the
Fund's shares;
(g) upon assignment of this Agreement, unless made with the written consent
of all other parties hereto;
(h) if TCIP's shares are not registered, issued or sold in conformance with
Federal or applicable state law or such law precludes the use of Fund shares as
the underlying investment medium of Contracts issued or to be issued by the
Company, provided that prompt notice shall be given by either party should such
situation occur;
(i) at the option of the Company by written notice to the other parties in
the event that the Fund ceases to qualify as a Regulated Investment Company
under Subchapter M of the Internal Revenue Code or in the event that the Fund
fails to meet the diversification requirements specified in Section 4(c) of this
Agreement, or if the Company reasonably believes in good faith that the fund may
fail to so qualify as a Regulated Investment Company or may fail to meet such
diversification requirements; or
8
(j) at the option of any party in the event that a majority of the Board of
TCIP determines that a material irreconcilable conflict exists as provided in
Section 14 of this Agreement.
9. Continuation of Agreement.
Termination as the result of any cause listed in Section 8 shall not affect
TCIP's obligation maintain an account in the name of the Company on behalf of
those Contract owners who selected the Fund as an investment option prior to the
termination of this Agreement; provided, however, TCIP shall have no
administrative services payment obligation to the Company after such
termination.
10. Substitution.
The Company has advised TCIP and Investors Research, and TCIP and Investors
Research understand that the Contracts provide that the Company reserves the
night to substitute the shares of another investment company or series thereof
for the shares of TCIP if such shares are no longer available for investment, or
if, in the judgment of the Company's management, further investment in the
shares of the Fund would be inappropriate in view of the purposes of the
Contracts. The Company hereby represents that all determinations of
appropriateness will be reasonably made in good faith.
11. Advertising Materials; Filed Documents.
(a) Advertising and literature with respect to TCIP prepared by the Company
or its agents for use in marketing its Contracts will be submitted to TCIP for
review before such material is submitted to the SEC or NASD for review.
(b) TCIP will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional information,
annual and semi-
9
annual reports, proxy statements and all amendments or supplements to any of the
above that relate to the Fund promptly after the filing of such document with
the SEC or other regulatory authorities. The Company will provide to TCIP at
least one complete copy of all registration statements, prospectuses, statements
of additional information, annual and semi-annual reports, proxy statements, and
all amendments or supplements to any of the above that relate to an Account
promptly after the filing of such document with the SEC or other regulatory
authority.
12. Proxy Voting.
(a) The Company shall provide pass-through voting privileges to all
Contract owners so long as the SEC continues to interpret the 1940 Act as
requiring such privileges. It shall be the responsibility of the Company to
assure that it and the separate accounts of the other Participating Companies
(as defined in Section 14(a) below) participating in the Fund calculate voting
privileges in a consistent manner. TCIP and Investors Research agree to advise
the Company if either shall be notified by a Participating Company of a change
in the calculation of voting privileges.
(b) The Company will distribute to Contract owners all proxy material
furnished by TCIP and will vote shares in accordance with instructions received
from such Contract owners. The Company shall vote TCIP shares for which no
instructions have been received in the same proportion as shares for which such
instructions have been received. The Company and its agents shall not oppose or
interfere with the solicitation of proxies for TCIP shares held for Contract
owners.
13. Indemnification.
(a) The Company agrees to indemnify and hold harmless TCIP and each of its
10
directors, officers, employees, agents and each person, if any, who controls
TCIP or its investment adviser within the meaning of the 1933 Act against any
losses, claims, damages or liabilities to which TCIP or any such director,
officer, employee, agent, or controlling person may become subject, under the
1933 Act or otherwise, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof (i) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, prospectus or sales literature of the Company or arise
out of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or arise out of or as a result of conduct, statements or
representations (other than statements or representations contained in the
registration statement, as amended, the prospectuses or sales literature of
TCIP) of the Company or its agents, with respect to the sale and distribution of
Contracts for which the shares of the Fund are the underlying investment, or
(ii) result from a breach of material provision of this Agreement. The Company
will reimburse any legal or other expenses reasonably incurred by TCIP or any
such director, officer, employee, agent, investment adviser, or controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such Registration Statement,
prospectus or sales literature in conformity with written materials furnished to
the Company by TCIP or Investors Research specifically for use therein.
(b) Investors Research agrees to indemnify and hold harmless the Account,
11
Company and each of its directors, officers, employees, agents and each person,
if any, who controls the Company within the meaning of the 1933 Act against any
losses, claims, damages or liabilities to which the Account, the Company or any
such director, officer, employee, agent or controlling person may become
subject, under the 1933 Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof (i) arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, prospectuses or sales literature of the
Fund or arise out of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein or material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (ii) result from a breach of a material provision of this
Agreement. Investors Research will reimburse any legal or other expenses
reasonably incurred by the Company or any such director, officer, employee,
agent, or controlling person in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that Investors
Research will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
Registration Statement, prospectuses or sales literature in conformity with
written materials furnished to TCIP by the Company specifically for use therein.
(c) Promptly after receipt by an indemnified party hereunder of notice of
the commencement of action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party hereunder, notify the
indemnifying party of the commencement thereof, but the omission so to notify
the indemnifying party will not relieve it from any liability which it may have
to any indemnified party otherwise than under this
12
Section 13. In case any such action is brought against any indemnified party,
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the extent
that it may wish to, assume the defense thereof, with counsel satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section 13 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
14. Potential Conflicts.
(a) The Company has received a copy of an application for exemptive relief,
as amended, filed by TCIP on December 21, 1987, with the SEC and the order
issued by the SEC in response thereto (the "Shared Funding Exemptive Order").
The Company has reviewed the conditions to the requested relief set forth in
such application for exemptive relief. As set forth in such application, the
Board of Directors of TCIP (the "Board") will monitor TCIP for the existence of
any material irreconcilable conflict between the interests of the
contractholders of all separate accounts ("Participating Companies") investing
in TCIP. An irreconcilable material conflict may arise for a variety of reasons,
including: (i) an action by any state insurance regulatory authority; (ii) a
change in applicable federal or state insurance, tax, or securities laws or
regulations, or a public ruling, private letter ruling, no-action or
interpretative letter, or any similar actions by insurance, tax or securities
regulatory authorities; (iii) an administrative or judicial decision in any
relevant proceeding; (iv) the manner in which the investments of any portfolio
are being managed; (v) a difference in voting instructions given by variable
annuity contractholders and variable life insurance
13
contractholders; or (vi) a decision by an insurer to disregard the voting
instructions of contractholders. The Board shall promptly inform the Company if
it determines that an irreconcilable material conflict exists and the
implications thereof.
(b) The Company will report any potential or existing conflicts of which it
is aware to the Board. The Company will assist the Board in carrying out its
responsibilities under the Shared Funding Exemptive Order by providing the Board
with all information reasonably necessary for the Board to consider any issues
raised. This includes, but is not limited to, an obligation by the Company to
inform the Board whenever contractholder voting instructions are disregarded.
(c) If a majority of the Board, or a majority of its disinterested Board
members, determines that a material irreconcilable conflict exists with regard
to contractholder investments in the Fund, the Board shall give prompt notice to
all Participating Companies. If the Board determines that the Company is
responsible for causing or creating said conflict, the Company shall at its sole
cost and expense, and to the extent reasonably practicable (as determined by a
majority of the disinterested Board members), take such action as is necessary
to remedy or eliminate the irreconcilable material conflict. Such necessary
action may include but shall not be limited to:
(i) withdrawing the assets allocable to the Account from the Fund and
reinvesting such assets in a different investment medium or submitting
the question of whether such segregation should be implemented to a
vote of all affected contractholders and as appropriate, segregating
the assets of any appropriate group (i.e., annuity contract owners,
life insurance contract owners, or variable contract owners of one or
more Participating Companies) that votes in favor of such segregation,
or offering to the affected contractholders the option of making such
a change; and/or
(ii) establishing a new registered management investment company or
14
managed separate account.
(d) If a material irreconcilable conflict arises as a result of a decision
by the Company to disregard its contractholder voting instructions and said
decision represents a minority position or would preclude a majority vote by all
of its contractholders having an interest in TCIP, the Company at its sole cost,
may be required, at the Board's election, to withdraw the Account's investment
in TCIP and terminate this Agreement; provided, however, that such withdrawal
and termination shall be limited to the extent required by the foregoing
material irreconcilable conflict as determined by a majority of the
disinterested members of the Board.
(e) For the purpose of this Section 14, a majority of the disinterested
Board members shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event will TCIP be
required to establish a new funding medium for any Contract. The Company shall
not be required by this Section 14 to establish a new funding medium for any
Contract if an offer to do so has been declined by vote of a majority of the
Contract owners materially adversely affected by the irreconcilable material
conflict.
15. Miscellaneous.
(a) Amendment and Waiver. Neither this Agreement, nor any provision hereof,
may be amended, waived, discharged or terminated orally, but only by an
instrument in writing signed by all parties hereto.
(b) Notices. All notices and other communications hereunder shall be given
or made in writing and shall be delivered personally, or sent by telex,
telecopier, express delivery or registered or certified mail, postage prepaid,
return receipt requested, to the party
15
or parties to whom they are directed at the following addresses, or at such
other addresses as may be designated by notice from such party to all other
parties.
To the Company: American United Life Insurance Company
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx
To TCI or Investors Research:
TCI Portfolios, Inc.
0000 Xxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Any notice, demand or other communication given in a manner prescribed in this
subsection (b) shall be deemed to have been delivered on receipt.
(c) Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective permitted successors
and assigns
(d) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any party hereto may execute this Agreement by signing any such counterpart.
(e) Severability. In case any one or more of the provisions contained in
this Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
(f) Entire Agreement. This Agreement constitutes the entire agreement and
understanding between the parties hereto and supersedes all prior agreement and
understandings relating to the subject matter hereof.
16
IN WITNESS WHEREOF, the undersigned have executed this Agreement by their
duly authorized officers as of this 1st day of March 1994.
AMERICAN UNITED LIFE INSURANCE
COMPANY
By: ____________________________
Name: Xxxxx X. Xxxxx, Xx.
Title: Vice President
INVESTORS RESEARCH CORPORATION
By: ____________________________
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President
TCI PORTFOLIOS, INC.
By: ____________________________
Name: Xxxxxxx X. Xxxxx
Title: Vice President
AMENDMENT NO. 1 TO
FUND PARTICIPATION AGREEMENT
THIS AMENDMENT NO. 1 TO FUND PARTICIPATION AGREEMENT is made and entered
into as of the 31st day of August, 1994, by and among AMERICAN UNITED LIFE
INSURANCE COMPANY (the "Company"), TCI PORTFOLIOS,INC. ("TCIP") and its invest-
ment adviser, INVESTORS RESEARCH CORPORATION ("Investors Research"). Capitalized
terms not otherwise defined herein shall have the meaning ascribed to them in
the Agreement (defined below).
WITNESSETH
WHEREAS, the Company, TCIP and Investors Research are parties to a Fund
Participation Agreement (the "Agreement") dated as of March 1, 1994, whereby
shares of TCI Growth, a series of mutual fund shares registered under the
Investment Company Act of 1940 and issued by TCIP, were made available by TCIP
to serve as underlying investment media for individual and group annuity
contracts to be issued through one or more separate accounts established by the
Company under state law; and
WHEREAS, the Company, TCIP and Investors Research now desire to modify the
Agreement so that shares of TCI International (another series of registered
mutual fund shares issued by TCIP) may be made available to the Company to serve
as underlying investment media for such contracts.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and promises expressed herein, the parties agree as follows:
1. From the date hereof pursuant to the terms of the Agreement, as
amended from time to time, shares of TCI International shall be made
available to serve as underlying investment media for the Contracts.
2. The Company represents that it has established the All American
Individual Separate Account and the All American Group Separate
Account (the "Accounts") as separate accounts under Indiana Insurance
Law to serve as investment vehicles for the Contracts. The Accounts
are registered as unit investment trusts under the Investment Company
Act of 1940 to serve as investment vehicles for the Contracts.
3. All references to "Account" under the Agreement shall be deemed to
refer to the Accounts under this First Amendment.
4. From and after the date hereof, unless the context otherwise requires,
all references in the Agreement to the term "Fund" shall be deemed to
include TCI International.
5. In the event that there is any conflict between the terms of this
Amendment No. 1 and the Agreement, it is the intention of the parties
hereto that the terms of this Amendment No. 1 shall
2
control, and the Agreement shall be interpreted on that basis. To the
extent that the provisions of the Agreement have not been amended by
this Amendment No. 1, the parties hereto hereby confirm and ratify the
Agreement.
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of
the date first above written.
AMERICAN UNITED LIFE INSURANCE COMPANY
By: ___________________________________
Name: Xxxxx X. Xxxxx, Xx.
Title: Vice President Pensions
Contracts to Compliance
INVESTORS RESEARCH CORPORATION
By: ___________________________________
Xxxxxxx X. Xxxxx
Executive Vice President
TCI PORTFOLIOS, INC.
By: ___________________________________
Xxxxxxx X. Xxxxx
Executive Vice President
AMENDMENT NO. 2 TO FUND PARTICIPATION AGREEMENT
THIS AMENDMENT NO. 2 TO FUND PARTICIPATION AGREEMENT is made and entered
into as of the 16th day of September 1997, by and among AMERICAN UNITED LIFE
INSURANCE COMPANY (the "Company"), AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.,
formerly known as TCI Portfolios, Inc. (the "Issuer"), and its investment
adviser, AMERICAN CENTURY INVESTMENT MANAGEMENT, INC., formerly known as
Investors Research Corporation (the "Adviser"). Capitalized terms not otherwise
defined herein shall have the meaning ascribed to them in the Agreement (as
defined below).
WHEREAS, the Company, the Issuer and the Adviser are parties to a Fund
Participation Agreement, dated as of March 1, 1994 and amended as of August 31,
1994 (the "Agreement"), whereby shares of VP Capital Appreciation, formerly
known as TCI Growth, and shares of VP International, formerly known as TCI
International, each of which is a series of mutual fund shares registered under
the Investment Company Act of 1940, as amended, and issued by the Issuer
(collectively, the "Funds"), were made available by the Issuer to serve as
underlying investment media for individual and group annuity contracts to be
issued through one or more separate accounts established by the Company under
state law; and
WHEREAS, the Company offers or will offer to the public certain individual
and group variable life insurance contracts (the "Variable Life Contracts"); and
WHEREAS, the Company, the Issuer and the Adviser now desire to modify the
Agreement so that shares of the Funds may be made available to the Company to
serve as underlying investment media for the Variable Life Contracts in addition
to the annuity contracts.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and promises expressed herein, the parties hereto hereby agree as follows:
1. The Company represents that it has established or will establish one
or more separate accounts (each a "Variable Life Account") under state
insurance law, each of which is or will be registered as a unit
investment trust under the 1940 Act, to serve as investment vehicles
for the Variable Life Contracts.
2. From and after the date hereof, pursuant to the terms of the Agreement
as amended from time to time, shares of the Funds shall be made
available to serve as underlying investment media for the Variable
Life Contracts in addition to the annuity contracts.
3. From and after the date hereof, unless the context otherwise requires,
(a) references in the Agreement to the term "Account" shall be deemed
to include the Variable Life Accounts and (b) references in the
Agreement to the term "Contracts" shall be deemed to include the
Variable Life Contracts.
2
4. In the event that there is any conflict between the terms of this
Amendment No. 2 and the Agreement, it is the intention of the parties
hereto that the terms of this Amendment No. 2 shall control, and the
Agreement shall be interpreted on that basis. To the extent that the
provisions of the Agreement have not been amended by this Amendment
No. 2, the parties hereto hereby confirm and ratify the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 2
as of the date first above written,
AMERICAN UNITED LIFE INSURANCE COMPANY
By: ______________________________________
Name: Xxxxxxx X. Xxxxxx
Title: Associate General Counsel
AMERICAN CENTURY INVESTMENT
MANAGEMENT, INC.
By: ______________________________________
Xxxxxxx X. Xxxxx
Executive Vice President
AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.
By: ______________________________________
Xxxxxxx X. Xxxxx
Executive Vice President
