MANAGEMENT AGREEMENT
Class II
This MANAGEMENT AGREEMENT is made and entered into by and between the
registered investment company listed on Exhibit A to this Agreement (the
"Company"), as of the dates noted on such Exhibit A, and American Century
Investment Management, Inc., a Delaware corporation (the "Investment Manager").
WHEREAS, the Company has adopted a Multiple Class Plan dated as of
December 31, 2002, (as the same may be amended from time to time, the "Multiple
Class Plan"), pursuant to Rule 18f-3 of the Investment Company Act of 1940, as
amended (the "Investment Company Act"); and
WHEREAS, the Multiple Class Plan establishes two classes of shares of
certain series of shares of the Company: Class I and Class II; and
IN CONSIDERATION of the mutual promises and agreements herein
contained, the parties agree as follows:
1. Investment Management Services. The Investment Manager shall supervise
the investments of Class II of each series of shares of the Company
contemplated as of the date hereof, and Class II of such subsequent
series of shares as the Company shall select the Investment Manager to
manage. In such capacity, the Investment Manager shall maintain a
continuous investment program for Class II of each such series,
determine what securities shall be purchased or sold by each series,
secure and evaluate such information as it deems proper and take
whatever action is necessary or convenient to perform its functions,
including the placing of purchase and sale orders. In performing its
duties hereunder, the Investment Manager will manage the portfolio of
all classes of a particular series as a single portfolio.
2. Compliance With Laws. All functions undertaken by the Investment
Manager hereunder shall at all times conform to, and be in accordance
with, any requirements imposed by:
(a) the Investment Company Act of 1940, as amended (the "1940
Act"), and any rules and regulations promulgated thereunder;
(b) any other applicable provisions of law;
(c) the Articles of Incorporation applicable to each of the
Company as amended from time to time;
(d) the By-Laws of the Company as amended from time to time;
(e) The Multiple Class Plan; and
(f) the registration statement of the Company, as amended from
time to time, filed under the Securities Act of 1933 and the
1940 Act.
3. Board Supervision. All of the functions undertaken by the Investment
Manager hereunder shall at all times be subject to the direction of the
Board of Directors of the Company, its executive committee, or any
committee or officers of the Company acting under the authority of the
Board of Directors.
4. Payment Of Expenses. The Investment Manager will pay all of the
expenses of Class II of each series of the Company's shares that it
shall manage, other than interest, taxes, brokerage commissions,
portfolio insurance, extraordinary expenses and the fees and expenses
of those Directors who are not "interested persons" as defined in the
1940 Act (hereinafter referred to as the "Independent Directors")
(including counsel fees) and expenses incurred in connection with the
provision of shareholder services and distribution services under the
Master Distribution Plan dated November 1, 2002. The Investment Manager
will provide the Company with all physical facilities and personnel
required to carry on the business of Class II of each series that the
Investment Manager shall manage, including but not limited to office
space, office furniture, fixtures and equipment, office supplies,
computer hardware and software and salaried and hourly paid personnel.
The Investment Manager may at its expense employ others to provide all
or any part of such facilities and personnel.
5. Account Fees. The Board of Directors may impose fees for various
account services, proceeds of which may be remitted to the appropriate
Fund or the Investment Manager at the discretion of the Board. At least
60 days' prior written notice of the intent to impose such fee must be
given to the shareholders of the affected series.
6. Management Fees.
(a) In consideration of the services provided by the Investment
Manager, Class II of each series of shares of the Company
managed by the Investment Manager shall pay to the Investment
Manager a per annum management fee (hereinafter, the
"Applicable Fee"). The calculation of the Applicable Fee for
Class II of a series is performed as follows:
(i) Each series is assigned to one of three categories
based on its overall investment objective
("Investment Category"). The Investment Category
assignments appear in Exhibit B to this Agreement.
(ii) Each series is assigned a fee schedule within its
Investment Category in Exhibit C to this Agreement.
The Investment Category assets managed by the
Investment Manager determines the first component of
a series' fee. This fee is referred to as the
"Investment Category Fee". The determination of the
Investment Category assets is as follows:
a) Money Market Fund Category. The
assets which are used to determine
the fee for this Investment
Category is the sum of the assets
of all of the open-end investment
company series which invest
primarily in debt securities, are
subject to Rule 2a-7 under the 1940
Act, managed by the Investment
Manager and distributed to the
public by American Century
Investment Services, Inc.
b) Bond Fund Category. The assets
which are used to determine the fee
for this Investment Category is the
sum the assets of all of the
open-end investment company series
which invest primarily in debt
securities, are not subject to Rule
2a-7 under the 1940 Act, are
managed by the Investment Manager
and are distributed to the public
by American Century Investment
Services, Inc.
c) Equity Fund Category. The assets
which are used to determine the fee
for this Investment Category is the
sum the assets of all of the
open-end investment company series
which invest primarily in equity
securities, are managed by the
Investment Manager and are
distributed to the public by
American Century Investment
Services, Inc.
(iii) A fee which is based on the total assets in all of
the Investment Categories is determined by the
schedule which appears in Exhibit D. This fee is
referred to as the series' "Complex Fee".
(iv) The Applicable Fee for a series is the sum of the
Investment Category Fee and the Complex Fee.
(v) The assets which are used to compute the Applicable
Fee shall be the assets of all of the open-end
investment companies managed by the Investment
Manager. Any exceptions to this requirement shall be
approved by the Board of Directors.
(b) On the first business day of each month, the Class II of each
series of shares shall pay the management fee at the rate
specified by subparagraph (a) of this paragraph 6 to the
Investment Manager for the previous month. The fee for the
previous month shall be calculated by multiplying the
Applicable Fee for such series by the aggregate average daily
closing value of the series' net assets during the previous
month, and further multiplying that product by a fraction, the
numerator of which shall be the number of days in the previous
month, and the denominator of which shall be 365 (366 in leap
years).
(c) In the event that the Board of Directors shall determine to
issue Class II of any additional series of shares for which it
is proposed that the Investment Manager serve as investment
manager, the Company and the Investment Manager shall enter
into an Addendum to this Agreement setting forth the name of
the series, the Applicable Fee and such other terms and
conditions as are applicable to the management of such series
of shares.
7. Continuation Of Agreement. This Agreement shall continue in effect,
unless sooner terminated as hereinafter provided, for a period of two
years from the execution hereof, and for as long thereafter as its
continuance is specifically approved, as to each series of the
Companies, at least annually (i) by the Board of Directors or by the
vote of a majority of the outstanding Class II voting securities of the
Company, and (ii) by the vote of a majority of the Directors of the
Company, who are not parties to the agreement or interested persons of
any such party, cast in person at a meeting called for the purpose of
voting on such approval.
8. Termination. This Agreement may be terminated, with respect to any
series, by the Investment Manager at any time without penalty upon
giving the Company 60 days' written notice, and may be terminated, with
respect to any series, at any time without penalty by the Board of
Directors or by vote of a majority of the outstanding Class II voting
securities of such series on 60 days' written notice to the Investment
Manager.
9. Effect Of Assignment. This Agreement shall automatically terminate in
the event of assignment by the Investment Manager, the term
"assignment" for this purpose having the meaning defined in Section
2(a)(4) of the 1940 Act.
10. Other Activities. Nothing herein shall be deemed to limit or restrict
the right of the Investment Manager, or the right of any of its
officers, directors or employees (who may also be a trustee, officer or
employee of the Company), to engage in any other business or to devote
time and attention to the management or other aspects of any other
business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or
association.
11. Standard Of Care. In the absence of willful misfeasance, bad faith,
gross negligence, or reckless disregard of its obligations or duties
hereunder on the part of the Investment Manager, it, as an inducement
to it to enter into this Agreement, shall not be subject to liability
to the Company or to any shareholder of the Company for any act or
omission in the course of, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security.
12. Separate Agreement. The parties hereto acknowledge that certain
provisions of the 1940 Act, in effect, treat each series of shares of a
registered investment company as a separate investment company.
Accordingly, the parties hereto hereby acknowledge and agree that, to
the extent deemed appropriate and consistent with the 1940 Act, this
Agreement shall be deemed to constitute a separate agreement between
the Investment Manager and each series of shares of the Company managed
by the Investment Manager.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers as of the day and year
indicated on Exhibit A.
Attest: American Century Variable
Portfolios II, Inc.
/s/Xxxxxxxxx X. Xxxxxxxx /s/Xxxxxxx X. Xxxxxxxxxxx
Xxxxxxxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxxxxxxx
Assistant Secretary Vice President
Attest: American Century Investment
Management, Inc.
/s/Xxxxxxxxx X. Xxxxxxxx /s/Xxxxx X. Xxxxxx
Xxxxxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxx
Assistant Secretary Senior Vice President
Exhibit A
Registered Investment Companies Subject to Management Agreement
Registered Investment Company and Fund Date
-------------------------------------- ----
American Century Variable Portfolios II, Inc.
VP Inflation Protection Fund December 31, 2002
Dated: December 31, 2002
Exhibit B
Series Investment Categories
Investment Category Series
------------------- ------
Bond Funds VP Inflation Protection Fund
Investment Category Series
------------------- ------
Equity Funds none
Investment Category Series
------------------- ------
Money Market Funds none
Dated: December 31, 2002
Exhibit C
Investment Category Fee Schedules: Money Market Funds
Schedule 1 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.2500%
Next $1 billion 0.2070%
Next $3 billion 0.1660%
Next $5 billion 0.1490%
Next $15 billion 0.1380%
Next $25 billion 0.1375%
Thereafter 0.1370%
Schedule 2 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.2700%
Next $1 billion 0.2270%
Next $3 billion 0.1860%
Next $5 billion 0.1690%
Next $15 billion 0.1580%
Next $25 billion 0.1575%
Thereafter 0.1570%
Schedule 3 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.3700%
Next $1 billion 0.3270%
Next $3 billion 0.2860%
Next $5 billion 0.2690%
Next $15 billion 0.2580%
Next $25 billion 0.2575%
Thereafter 0.2570%
Category Fee Schedules: Bond Funds
Schedule 1 Funds:
VP Inflation Protection Fund
Category Assets Fee Rate
--------------- --------
First $1 billion 0.2800%
Next $1 billion 0.2280%
Next $3 billion 0.1980%
Next $5 billion 0.1780%
Next $15 billion 0.1650%
Next $25 billion 0.1630%
Thereafter 0.1625%
Schedule 2 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.3100%
Next $1 billion 0.2580%
Next $3 billion 0.2280%
Next $5 billion 0.2080%
Next $15 billion 0.1950%
Next $25 billion 0.1930%
Thereafter 0.1925%
Schedule 3 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.3600%
Next $1 billion 0.3080%
Next $3 billion 0.2780%
Next $5 billion 0.2580%
Next $15 billion 0.2450%
Next $25 billion 0.2430%
Thereafter 0.2425%
Category Fee Schedules: Bond Funds
(continued)
Schedule 4 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.6100%
Next $1 billion 0.5580%
Next $3 billion 0.5280%
Next $5 billion 0.5080%
Next $15 billion 0.4950%
Next $25 billion 0.4930%
Thereafter 0.4925%
Schedule 5 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.4100%
Next $1 billion 0.3580%
Next $3 billion 0.3280%
Next $5 billion 0.3080%
Next $15 billion 0.2950%
Next $25 billion 0.2930%
Thereafter 0.2925%
Schedule 6 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.6600%
Next $1 billion 0.6080%
Next $3 billion 0.5780%
Next $5 billion 0.5580%
Next $15 billion 0.5450%
Next $25 billion 0.5430%
Thereafter 0.5425%
Category Fee Schedules: Equity Funds
Schedule 1 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.5200%
Next $5 billion 0.4600%
Next $15 billion 0.4160%
Next $25 billion 0.3690%
Next $50 billion 0.3420%
Next $150 billion 0.3390%
Thereafter 0.3380%
Schedule 2 Funds:
none
Category Assets Fee Rate
--------------- --------
First $1 billion 0.7200%
Next $5 billion 0.6600%
Next $15 billion 0.6160%
Next $25 billion 0.5690%
Next $50 billion 0.5420%
Next $150 billion 0.5390%
Thereafter 0.5380%
Dated: December 31, 2002
D-1
Exhibit D
Complex Fee Schedule
Complex Assets Fee Rate
-------------- --------
First $2.5 billion 0.3100%
Next $7.5 billion 0.3000%
Next $15.0 billion 0.2985%
Next $25.0 billion 0.2970%
Next $50.0 billion 0.2960%
Next $100.0 billion 0.2950%
Next $100.0 billion 0.2940%
Next $200.0 billion 0.2930%
Next $250.0 billion 0.2920%
Next $500.0 billion 0.2910%
Thereafter 0.2900%
Dated: December 31, 2002
