CONTRACT LAPSE, TERMINATION, SURRENDER, ETC Clause Samples
The "Contract Lapse, Termination, Surrender, Etc." clause defines the conditions and procedures under which a contract may end before its originally intended completion. This clause typically outlines scenarios such as non-payment, mutual agreement, or voluntary surrender by one party, and details the steps required to formally terminate the agreement, including any notice periods or financial consequences. Its core function is to provide clear guidelines for ending the contractual relationship, thereby reducing uncertainty and potential disputes between the parties.
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CONTRACT LAPSE, TERMINATION, SURRENDER, ETC. During the term of this Agreement and for two (2) years following the termination of this Agreement, neither DISTRIBUTOR nor any of its VKAC Associated Agencies or Sales Persons, or any affiliate, director, officer or employee of the foregoing, shall induce or cause, or attempt to induce or cause, directly or indirectly, any Contract owner (a) to lapse, terminate, surrender, exchange, or cancel his or her Contract, (b) to cease or discontinue making premium payments thereunder, or (c) to direct cash value or premium payments thereunder to any other financial product without the prior written consent of AGNY, unless such act is in response to an enactment of federal or state legislation, order or decision of any court or regulatory authority, or a change in circumstances that makes the Contracts or insurance contracts of that type (E.G., annuity contracts or life insurance contracts) an unsuitable investment for existing Contract owners. AGNY shall have the right to cease compensation payments to DISTRIBUTOR in the event this provision is violated; provided, however, that this Section 9 shall have no effect in the event AGNY undertakes either (1) a formal exchange offer of the Contracts, or (2) a substitution of any series of a fund or funds advised or sub-advised by an affiliate of DISTRIBUTOR pursuant to Section 26(b) of the Investment Company Act of 1940, and neither (1) nor (2) is undertaken as a result of DISTRIBUTOR's or such affiliates inability to perform their respective obligations hereunder.
CONTRACT LAPSE, TERMINATION, SURRENDER, ETC