EXHIBIT 1.A.(3)(d)(ii)
FUND PARTICIPATION AGREEMENT
THIS FUND PARTICIPATION AGREEMENT is made and entered into as of May 16,
1997 by and among PRUCO LIFE INSURANCE COMPANY (the "Company"), AMERICAN
CENTURY INVESTMENT SERVICES, INC. ("Distributor"), and AMERICAN CENTURY
INVESTMENT MANAGEMENT, INC. ("Manager").
WHEREAS, the Company offers to the public certain individual variable
universal life contracts (the "Contracts"); and
WHEREAS, the Company wishes to offer as investment options under the
Contracts, the funds listed on EXHIBIT A hereto (the "Funds"), each of which is
a series of mutual fund shares registered under the Investment Company Act of
1940, as amended (the "Investment Company Act"); and
WHEREAS, on the terms and conditions hereinafter set forth, Distributor and
the Manager desire to make shares of the Funds available as an investment
option under the Contracts and to retain the Company to perform certain
administrative services on behalf of the Funds;
NOW, THEREFORE, the Company, the Manager and Distributor agree as follows:
1. TRANSACTIONS IN THE FUNDS. Subject to the terms and conditions of this
Agreement, the Distributor will make shares of the Funds available to be
purchased, exchanged, or redeemed, by the Company on behalf of Contract owners
through the Accounts (defined in SECTION 6(a) below) through a single account
per Fund at the net asset value applicable to each order. The Funds' shares
shall be purchased and redeemed on a net basis in such quantity and at such
time as determined by the Company to satisfy the requirements of the Contracts
for which the Funds serve as underlying investment media. Dividends and capital
gains distributions will be automatically reinvested in full and fractional
shares of the Funds.
2. ADMINISTRATIVE SERVICES. The Company shall be solely responsible for
providing all administrative services for the Contract owners. The Company
agrees that it will maintain and preserve all records as required by law to be
maintained and preserved, and will otherwise comply with all laws, rules and
regulations applicable to the marketing of the Contracts and the provision of
administrative services to the Contract owners.
3. PROCESSING AND TIMING OF TRANSACTIONS.
(a) Distributor hereby appoints the Company as its agent for the limited
purpose of accepting purchase and redemption orders for Fund shares from the
Contract owners. On each day the New York Stock Exchange (the "Exchange") is
open for business (each, a "Business Day"), the Company may receive instructions
from the Contract owners for the purchase or redemption of shares of the Funds
("Orders"). Orders received and accepted by the Company prior to the close of
regular trading on the Exchange (the "Close of Trading") on any given Business
Day (currently, 3:00 p.m. Central time) and transmitted to the Funds' transfer
agent by 9:00 a.m. Central time on the next following Business Day will be
executed at the net asset value determined as of the Close of Trading on the
previous Business Day ("Day 1"). Any Orders received by the Company after the
Close of Trading, and all Orders that are transmitted by the Company after 9:00
a.m. Central time on the next following Business Day, will be executed at the
net asset value next determined following receipt of such Order. The day as of
which an Order is executed pursuant to the provisions set forth above is
referred to herein as the "Effective Trade Date".
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(b) By 5:30 p.m. Central time on each Business Day, Distributor will
provide to the Company, via facsimile or other electronic transmission
acceptable to the Company, the Funds' net asset value, dividend and capital gain
information and, in the case of income funds, the daily accrual for interest
rate factor (mil rate), determined at the Close of Trading. If Distributor
provides the Company with materially incorrect share net asset value information
through no fault of the Company, the Company on behalf of the separate accounts
shall be entitled to an adjustment to the number of shares purchased or
redeemed to reflect the correct share net asset value. Any material error in the
calculation of net asset value per share, dividend or capital gain information
shall be reported to the Company promptly upon discovery.
(c) By 9:00 a.m. Central time on each Business Day, the Company will
provide to Distributor via facsimile or other electronic transmission acceptable
to Distributor a report stating whether the Orders received by the Company from
Contract owners by the Close of Trading on the preceding Business Day resulted
in the Accounts being a net purchaser or net seller of shares of the Funds. As
used in this Agreement, the phrase "other electronic transmission acceptable to
Distributor" includes the use of remote computer terminals located at the
premises of the Company, its agents or affiliates, which terminals may be linked
electronically to the computer system of Distributor, its agents or affiliates
(hereinafter, "Remote Computer Terminals").
(d) Upon the timely receipt from the Company of the report described in (c)
above, Distributor will execute the purchase or redemption transactions (as the
case may be) at the net asset value computed as of the Close of Trading on Day
1. Payment for net purchase transactions shall be made by wire transfer to the
custodial account designated by the Funds on the Business Day next following the
Effective Trade Date. Such wire transfers shall be initiated by the Company's
bank prior to 3:00 p.m. Central time and received by the Funds prior to 5:00
p.m. Central time on the Business Day next following the Effective Trade Date.
If payments for a purchase Order is not timely received, such Order will be
executed at the net asset value next computed following receipt of payment.
Payments for net redemption transactions shall be made by wire transfer by the
Funds to the account designated by the appropriate receiving party within the
time period set forth in the applicable Fund's then-current prospectus;
provided, however, Distributor will use all reasonable efforts to settle all
redemptions on the Business Day following the Effective Trade Date. On any
Business Day when the Federal Reserve Wire Transfer System is closed, all
communication and processing rules will be suspended for the settlement of
Orders. Orders will be settled on the next Business Day on which the Federal
Reserve Wire Transfer System is open and the Effective Trade Date will apply.
4. PROSPECTUS AND PROXY MATERIALS.
(a) Distributor shall provide to the shareholder of record copies of the
Funds' proxy materials, periodic fund reports to shareholders and other
materials that are required by law to be sent to the Funds' shareholders. In
addition, Distributor shall provide the Company with a sufficient quantity of
prospectuses of the Funds to be used in conjunction with the transactions
contemplated by this Agreement, together with such additional copies of the
Funds' prospectuses as may be reasonably requested by Company. If requested by
the Company in lieu thereof, Distributor or its designee shall provide such
documentation (including a "camera ready" copy of the new prospectus as set in
type or, at the request of the Company, as a diskette in the form sent to the
Funds' printer) and other assistance as is reasonably necessary in order for the
parties hereto once each year (or more frequently if the prospectus for the
Shares is supplemented or amended) to have the prospectus for the Contracts,
prospectuses for other mutual funds in which the Contracts may be invested, and
the Funds' new prospectus printed together in one document. If the Company
provides for pass-through voting by the Contract owners, Distributor will
provide the Company with a sufficient quantity of proxy materials for each
Contract owner.
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(b) The cost of preparing, printing and shipping of the prospectuses, proxy
materials, periodic fund reports and other materials of the Funds to the Company
shall be paid by Distributor or its agents or affiliates; provided, however,
that if at any time Distributor or its agent reasonably deems the usage by the
Company of such items to be excessive, it may, prior to the delivery of any
quantity of materials in excess of what is deemed reasonable, request that the
Company demonstrate the reasonableness of such usage. If the Distributor
believes the reasonableness of such usage has not been adequately demonstrated,
it may request that the Company pay the cost of printing (including press time)
and delivery of any excess copies of such materials. Unless the Company agrees
to make such payments. Distributor may refuse to supply such additional
materials and this section shall not be interpreted as requiring delivery by
Distributor of any copies in excess of the number of copies to be provided to
existing Contract owners.
(c) The cost of distribution, if any, of any prospectuses, proxy materials,
periodic fund reports and other materials of the Funds to the Contract owners
shall be paid by the Company and shall not be the responsibility of Distributor,
Manager or the Funds.
5. COMPENSATION AND EXPENSES.
(a) The Accounts shall be the sole shareholder of Fund shares purchased for
the Contract owners pursuant to this Agreement (the "Record Owners"). The
Company and the Record Owners shall properly complete any applications or other
forms required by Distributor or the Funds' transfer agent from time to time.
(b) Distributor acknowledges that it will derive a substantial savings in
administrative expenses, such as a reduction in expenses related to postage,
shareholder communications and recordkeeping, by virtue of having a single
shareholder account per Fund for the Accounts rather than having each Contract
owner as a shareholder. In consideration of performance by the Company of the
administrative services and performance of all other obligations under this
Agreement by the Company, Distributor will pay the Company a fee (the
"Administrative Services fee") equal to 20 basis points (0.20%) per annum of the
average aggregate amount invested by the Company under this Agreement,
commencing with the month in which the average aggregate market value of
investments by the Company (on behalf of the Contract owners) in the Funds
exceeds $10 million. No payment obligation shall arise until the Company's
average aggregate investment in the Funds 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 Funds drops below $10
million.
(c) The parties understand that Distributor 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 owners. The parties agree
that the payments by Distributor to the Company, like Distributor's payments to
its affiliated corporation, are for administrative services only and do not
constitute payment in any manner for investment advisory services or for costs
of distribution.
(d) For the purposes of computing the payment to the Company contemplated
by this SECTION 5, the average aggregate amount invested by the Accounts in the
Funds 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
of the Funds held by the Company) on each Business Day during the month and
dividing by the total number of Business Days during such month.
(e) Distributor will calculate the amount of the payment to be made
pursuant to this SECTION 5 at the end of each calendar quarter and will make
such payment to the Company within
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30 days thereafter. The check for such payment will be accompanied by a
statement showing the calculation of the amounts being paid by Distributor for
the relevant months and such other supporting data as may be reasonably
requested by the Company and shall be mailed to:
Pruco Life Insurance Company
c/o The Prudential Insurance Company of America
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇, Director of Accounting
6. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants that: (i) this Agreement has been
duly authorized by all necessary corporate action and, when executed and
delivered, shall constitute the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms; (ii) it has established the
accounts set forth on EXHIBIT B hereto (the "Accounts"), which are separate
accounts under Arizona insurance law, and has to the extent required by law
registered the Accounts as unit investment trusts under the Investment Company
Act to serve as investment vehicles for the Contracts; (iii) each Contract
provides for the allocation of net amounts received by the Company to an Account
for investment in the shares of one of more specified investment companies
selected among those companies available through the Accounts to act as
underlying investment media; (iv) selection of a particular investment company
is made by the Contract owner under a particular Contract, who may change such
selection from time to time in accordance with the terms of the applicable
Contract; and (v) the activities of the Company contemplated by this Agreement
comply with all provisions of federal and state insurance, securities, and tax
laws applicable to such activities.
(b) Distributor and Manager represent that: (i) this Agreement has been
duly authorized by all necessary corporate action and, when executed and
delivered, shall constitute the legal, valid and binding obligation of
Distributor and Manager, enforceable in accordance with its terms; and (ii) the
investments of the Funds will at all times be adequately diversified within the
meaning of Section 817(h) of the Internal Revenue Service Code of 1986, as
amended (the "Code"), and the regulations thereunder, and that at all times
while this Agreement is in effect, all beneficial interests in each of the Funds
will be owned by one or more insurance companies or by any other party permitted
under Section 1.817-5(f)(3) of the Regulations promulgated under the Code. In
the event of a breach of this Section 6 (b)(ii) by the Funds, Distributor or
Manager will take all reasonable steps (A) to notify the Company of such breach
and (B) to adequately diversify the Funds so as to achieve compliance within
the grace period afforded by Treasury Regulation 1.817-5.
(c) Distributor and Manager represent that the Funds are currently
qualified as a Regulated Investment Company under Subchapter M of the Internal
Revenue Code, and that it will maintain such qualification (under Subchapter M
or any successor or similar provision) and that either Distributor or Manager
will notify the Company immediately upon having a reasonable basis for believing
that the Funds have ceased to so qualify or that it might not qualify in the
future.
7. ADDITIONAL COVENANTS AND AGREEMENTS.
(a) Each party shall comply with all provisions of federal and state laws
applicable to its respective activities under this Agreement.
(b) Each party shall promptly notify the other parties in the event that it
is, for any reason, unable to perform any of its obligations under this
Agreement.
(c) The Company covenants and agrees that all Orders accepted and
transmitted by it hereunder with respect to the Accounts on any Business Day
will be based upon instructions that it
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received from the Contract owners in proper form prior to the Close of Trading
of the Exchange on that Business Day.
(d) The Company covenants and agrees that all Orders transmitted to the
Funds' transfer agent, whether by telephone, telecopy, or other electronic
transmission acceptable to Distributor, shall be sent by or under the authority
and direction of a person designated by the Company as being duly authorized to
act on behalf of the owner of the Account. Absent actual knowledge to the
contrary, Distributor shall be entitled to rely on the existence of such
authority and to assume that any person transmitting Orders for the purchase,
redemption or transfer of Fund shares on behalf of the Company is "an
appropriate person" as used in Sections 8-107 and 8-401 of the Uniform
Commercial Code with respect to the transmission of instructions regarding Fund
shares on behalf of the owner of such Fund shares. The Company shall maintain
the confidentiality of all passwords and security procedures issued, installed
or otherwise put in place with respect to the use of Remote Computer Terminals
and assumes full responsibility for the security therefor. The Company further
agrees to be solely responsible for the accuracy, propriety and consequences of
all data transmitted to Distributor by the Company by telephone, telecopy or
other electronic transmission acceptable to Distributor.
(e) The Company shall furnish, or shall cause to be furnished, to
Distributor, each piece of sales literature or other promotional material in
which a Fund, Manager or Distributor is named, at least ten business days prior
to its use. No such material shall be used if the Funds, Manager or Distributor
reasonably objects in writing to such use within ten business days after receipt
of such material.
(f) The Company shall not give any information or make any representations
or statements on behalf of any Fund or concerning any Fund other than the
information or representations contained in the registration statement or
prospectus for the Fund shares, as such registration statement and prospectus
may be amended or supplemented from time to time, or in reports or proxy
statements for that Fund, or in sales literature or other promotional material
approved by Distributor, except with the permission of Distributor. Distributor
agrees to respond to any request for approval on a prompt and timely basis.
(g) Distributor shall furnish, or shall cause to be furnished, to the
Company or its designee, each piece of sales literature or other promotional
material in which the Company or the Accounts is named, at least ten business
days prior to its use. No such material shall be used if the Company reasonably
objects in writing to such use within ten business days after receipt of such
material.
(h) Neither Distributor nor Manager shall give any information or make any
representations on behalf of the Company or concerning the Company, the
Accounts, or the Contracts other than the information or representations
contained in a registration statement or prospectus for the Contracts, as such
registration statement and prospectus may be amended or supplemented from time
to time, or in published reports for the Accounts which are in the public domain
or approved by the Company for distribution to Contract owners, or in sales
literature or other promotional material approved by the Company, except with
the permission of the Company. The Company agrees to respond to any request for
approval on a prompt and timely basis.
(i) Distributor will provide to the Company at least one complete copy of
all registration statements, prospectuses, statements of additional information,
reports, proxy
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statements, sales literature and other promotional materials, and all amendments
to any of the above, that relate to that Fund or its shares, upon the Company's
request.
(j) The Company will provide to Distributor or Manager at least one
complete copy of all registration statements, prospectuses, statements of
additional information, reports, solicitations for voting instructions, sales
literature and other promotional materials, and all amendments to any of the
above, that relate to the Contracts or the Accounts, upon the Distributor's or
Manager's request.
(k) For purposes of this Section 7, the phrase "sales literature or other
promotional material" includes, but is not limited to, advertisements (such as
material published, or designed for use in, a newspaper, magazine, or other
periodical, radio, television, telephone or tape recording, videotape display,
signs or billboards, motion pictures, or other public media), sales literature
(i.e., any written communication distributed or made generally available to
customers or the public, including brochures, circulars, research reports,
market letters, reprints or excerpts of any other advertisement, sales
literature, or published article), educational or training materials or other
communications distributed or made generally available to some or all agents or
employees, prospectuses, statements of additional information, shareholder
reports, and proxy materials and any other material constituting sales
literature or advertising under NASD rules, the Investment Company Act or the
Securities Act of 1993 (the "1933 Act").
8. USE OF NAMES. Except as otherwise expressly provided for in this
Agreement, neither Distributor, Manager nor the Funds shall use any trademark,
trade name, service ▇▇▇▇ or logo of the Company, or any variation of any such
trademark, trade name, service ▇▇▇▇ or logo, without the Company's prior written
consent, the granting of which shall be at the Company's sole option. Except as
otherwise expressly provided for in this Agreement, the Company shall not use
any trademark, trade name, service ▇▇▇▇ or logo of Manager, Distributor or the
Funds, or any variation of any such trademarks, trade names, service marks, or
logos, without the prior written consent of either Manager, Distributor or the
Funds, as appropriate, the granting of which shall be at the sole option of
Distributor, Manager and/or the Funds.
9. PROXY VOTING.
(a) The Company shall provide pass-through voting privileges to all
Contract owners so long as the SEC continues to interpret the Investment Company
Act as requiring such privileges. It shall be the responsibility of the Company
to assure that it calculates voting privileges in a consistent manner.
(b) The Company will distribute to Contract owners all proxy material
furnished by Distributor and will vote shares in accordance with instructions
received from such Contract owners. The Company shall vote Fund 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 Fund shares held for
such Contract owners.
10. INDEMNITY.
(a) Distributor and Manager agree to indemnify and hold harmless the
Company and its officers, directors, employees, agents, affiliates and each
person, if any, who controls the Company within the meaning of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this SECTION 10(a))
against any losses, claims, expenses, damages or liabilities (including amounts
paid in settlement thereof) or litigation expenses (including legal and other
expenses) (collectively, "Losses"), to which the Indemnified Parties may become
subject, insofar as such Losses (i) result
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from a breach by Distributor or Manager of a material provision of this
Agreement, or (ii) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any registration
statement or prospectus of the Funds or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading.
Distributor or Manager will reimburse any legal or other expenses reasonably
incurred by the Indemnified Parties in connection with investigating or
defending any such Losses. Distributor shall not be liable for indemnification
hereunder if such Losses are attributable to the negligence or misconduct of the
Company in performing its obligations under this Agreement.
(b) The Company agrees to indemnify and hold harmless Distributor, Manager
and the Funds and their respective officers, directors, employees, agents,
affiliates and each person, if any, who controls the Funds, Manager or
Distributor within the meaning of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this SECTION 10(b)) against any Losses to which the
Indemnified Parties may become subject, insofar as such Losses (i) result from a
breach by the Company of a material provision of this Agreement, or (ii) arise
out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained on any registration statement or prospectus of the
Company regarding the Contracts, if any, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
(iii) result from the use by any person of a Remote Computer Terminal. The
Company will reimburse any legal or other expenses reasonably incurred by the
Indemnified Parties in connection with investigating or defending any such
Losses. The Company shall not be liable for indemnification hereunder if such
Losses are attributable to the negligence or misconduct of Distributor, Manager
or the Funds in performing their obligations under this Agreement.
(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 SECTION 10. 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 10 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
(d) If the indemnifying party assumes the defense of any such action, the
indemnifying party shall not, without the prior written consent of the
indemnified parties in such action, settle or compromise the liability of the
indemnified parties in such action, or permit a default or consent to the entry
of any judgment in respect thereof, unless in connection with such settlement,
compromise or consent, each indemnified party receives from such claimant an
unconditional release from all liability in respect of such claim.
11. POTENTIAL CONFLICTS.
(a) The Company has received a copy of an application for exemptive relief,
as amended, filed by Distributor 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
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such application, the Board of Directors of the Funds (the "Board") will monitor
the Funds for the existence of any material irreconcilable conflict between the
interests of the contract owners of all separate accounts investing in the
Funds. 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 contract owners and variable life insurance contract owners; or (vi) a
decision by an insurer to disregard the voting instructions of contract owners.
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 contract owner 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 contract owner investments in the Funds, 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 Accounts from the Funds 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 contract owners 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 contract owners the option of making such
a change; and/or
(ii) establishing a new registered management investment company or managed
separate account.
(d) If a material irreconcilable conflict arises as a result of a decision
by the Company to disregard its contract owner voting instructions and said
decision represents a minority position or would preclude a majority vote by all
of its contract owners having an interest in the Funds, the Company at its sole
cost, may be required, at the Board's election, to withdraw the Accounts'
investment in the Funds 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 11, 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 the Funds be
required to establish a new funding medium for any Contract. The Company shall
not be required by this SECTION 11 to establish a new funding
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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.
12. TERMINATION. This agreement shall terminate as to the sale and issuance
of new Contracts:
(a) at the option of either the Company, Distributor or the Manager upon
six months' advance written notice to the other;
(b) at the option of the Company if the Funds' shares are not available for
any reason to meet the requirement of Contracts as determined by the Company.
Reasonable advance notice of election to terminate shall be furnished by
Company;
(c) at the option of either the Company, Distributor or the Manager, upon
institution of formal proceedings against the broker-dealer or broker-dealers
marketing the Contracts, any Account, the Company, Distributor, or the Funds by
the National Association of Securities Dealers, Inc. (the "NASD"), the SEC or
any other regulatory body;
(d) upon termination of the Management Agreement between the Funds and
Manager. Notice of such termination shall be promptly furnished to the Company.
This SUBSECTION (d) shall not be deemed to apply if contemporaneously with such
termination a new contract of substantially similar terms is entered into
between the Funds and Manager;
(e) upon the requisite vote of Contract owners having an interest in any of
the Funds to substitute for the Funds' shares the shares of another investment
company in accordance with the terms of Contracts for which the Funds' shares
had been selected to serve as the underlying investment medium. The Company will
give 60 days' written notice to the Funds and Distributor of any proposed vote
to replace the Funds' shares;
(f) upon assignment of this Agreement unless made with the written consent
of all other parties hereto;
(g) if the Funds' shares are not registered, issued or sold in conformance
with Federal law or such law precludes the use of Fund shares as an underlying
investment medium of Contracts issued or to be issued by the Company. Prompt
notice shall be given by either party should such situation occur;
(h) at the option of Distributor or Manager, if Distributor or Manager
reasonably determines in good faith that the Company is not offering shares of
the Funds in conformity with the terms of this Agreement or applicable law;
(i) at the option of any party hereto upon a determination that continuing
to perform under this Agreement would, in the reasonable opinion of the
terminating party's counsel, violate any applicable federal or state law, rule,
regulation or judicial order;
(j) At the option of the Company if a Fund fails to meet the
diversification requirements specified in Section 6(b)(ii) hereof; or
(k) At the option of any party to this Agreement, upon another party's
material breach of any provision of this Agreement.
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13. CONTINUATION OF AGREEMENT. Termination as the result of any cause
listed in SECTION 12 shall not affect Distributor's obligation to continue to
cause the Funds to furnish their shares under the terms of this Agreement to
Contracts then in force for which its shares serve or may serve as the
underlying medium (unless such further sale of Fund shares is proscribed by law
or the SEC or other regulatory body). Following termination, Distributor shall
not have any Administrative Services payment obligation to the Company (except
for payment obligations accrued but not yet paid as of the termination date).
14. NON-EXCLUSIVITY. Each of the parties acknowledges and agrees that
this Agreement and the arrangement described herein are intended to be
non-exclusive and that each of the parties is free to enter into
similar agreements and arrangements with other entities.
15. SURVIVAL. The provisions of SECTION 8 (use of names) and SECTION 10
(indemnity) of this Agreement shall survive termination of this Agreement.
16. AMENDMENT. 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 of the parties hereto.
17. 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 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:
Pruco Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
(▇▇▇) ▇▇▇-▇▇▇▇ (office number)
(▇▇▇) ▇▇▇-▇▇▇▇ (telecopy number)
To Distributor or Manager:
American Century Investments
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
(▇▇▇) ▇▇▇-▇▇▇▇ (office number)
(▇▇▇) ▇▇▇-▇▇▇▇ (telecopy number)
Any notice, demand or other communication given in a manner prescribed in this
SECTION 17 shall be deemed to have been delivered on receipt.
18. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned without the
written consent of all parties to the Agreement at the time of such assignment.
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective permitted successors and assigns.
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19. 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.
20. 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.
21. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties with respect to the matters dealt with herein, and
supersedes all previous agreements, written or oral, with respect to such
matters.
22. CONFIDENTIALITY. Subject to applicable law and regulatory authority,
each party hereto shall treat as confidential all information reasonably
identified as such in writing by any other party hereto (including without
limitation the names and addresses of the owners of the Contracts) and, except
as contemplated by this Agreement, shall not disclose, disseminate or utilize
such confidential information until such time as it may come into the public
domain without the expressed prior written consent of the affected party.
23. COOPERATION. Each party hereto shall cooperate with each other party
and all appropriate govermental authorities (including without limitation the
SEC, the NASD, and state insurance regulators) and shall permit each other and
such authorities reasonable access to its books and records in connection with
any investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date set forth above.
AMERICAN CENTURY INVESTMENT PRUCO LIFE INSURANCE COMPANY
SERVICES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------- -------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Executive Vice President Title: President
AMERICAN CENTURY INVESTMENT
MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President
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EXHIBIT A
FUNDS AVAILABLE
================================================================================
ISSUER NAME OF FUND
--------------------------------------------------------------------------------
TCI Portfolios, Inc. TCI Value
================================================================================
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EXHIBIT B
ACCOUNTS
Pruco Life Variable Appreciable Account
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