SERVICE AGREEMENT
BETWEEN
DELAWARE MANAGEMENT COMPANY,
A SERIES OF DELAWARE MANAGEMENT BUSINESS TRUST
AND
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
This Agreement ("Service Agreement") sets forth the terms and conditions of the
Service Agreement between Delaware Management Company, a Series of Delaware
Management Business Trust ("Delaware") and The Lincoln National Life Insurance
Company (the "Company"), effective as of the 1st day of May, 2003.
The Company and Lincoln Variable Insurance Products Trust (the "Trust") have
entered into a Fund Participation Agreement, dated the ___________, 2003, as may
be amended from time to time, pursuant to which the Company, on behalf of
certain of its separate accounts and those which it administers (together
"Separate Accounts"), has selected the Trust to serve as an investment vehicle
under certain variable annuity and/or variable life insurance contracts
("Variable Contracts") offered by the Company, of which Trust may be one of
several investment options available under the Variable Contracts. The Trust is
divided into several series of shares, each designated a "Fund". Delaware is the
investment adviser for the Trust.
Delaware recognizes that in the course of soliciting applications for the
Variable Contracts and in servicing owners of the Variable Contracts, the
Company and its agents provide ongoing services respecting Variable Contract
owners' investments in the Trust.
Delaware understands that it benefits from the services that the Company and its
agents provide with respect to the Trust. These services promote retention of
assets in the Trust, which, in turn, provides benefits to Delaware. These
services also contribute to an increase in the assets in the Trust, which, in
turn, results in increased benefits to Delaware.
Accordingly, the following represents the collective intention and understanding
of Delaware and the Company:
The Company and/or its agents agree to provide services to current owners of
Variable Contracts which may include, but not limited to: teleservicing support
in connection with the Trust; delivery of notices; facilitation of the
tabulation of Variable Contract owners' votes in the event of a meeting of the
shareholders; maintenance of Variable Contact records
reflecting units purchased and redeemed and unit balances; provision of support
services including providing information about the Trust and answering questions
concerning the Trust, including questions respecting Variable Contract owners'
interests in the Trust; provision and administration of Variable Contract
features for the benefit of Variable Contract owners participating in the Trust,
including transfers, dollar cost averaging, asset allocation, portfolio
rebalancing, earnings sweep, and pre-authorized deposits and withdrawals; and
provision of other services as may be agreed upon from time to time.
In consideration of the benefits that Delaware derives from such services,
Delaware agrees to pay to the Company a service fee (not from Trust assets but
from the assets of Delaware) at an annual rate set forth in the attached Exhibit
A. For purposes of computing the payment to the Company under this paragraph,
the average daily value of shares held in the covered Separate Accounts over a
monthly period shall be computed by totaling such Separate Accounts' aggregate
investment (share net asset value multiplied by total number of shares held by
such Separate Accounts) on each business day during the calendar month, and
dividing by the total number of business days during such month. The payment to
the Company under this paragraph shall be calculated by Delaware at the end of
each calendar month and will be paid to the Company within ten (10) calendar
days thereafter. Supporting documentation of payment, in format agreeable to
both parties, shall be provided along with the payment.
The Service Agreement shall remain in full force and effect until terminated by
either the Company or Delaware upon 60 days' written notice to the other, and
shall terminate automatically upon redemption of all shares held in Separate
Accounts.
Notwithstanding the termination of the Service Agreement, Delaware will continue
to pay the service fees in accordance with the preceding paragraph so long as
net assets of the Company or a Separate Account remain in the Trust and the
Company performs such services, provided such continued payment is permitted in
accordance with applicable law and regulation. The Service Agreement may be
amended only upon mutual agreement of the Company and Delaware in writing.
Nothing in the Service Agreement shall amend, modify or supersede any
contractual terms, obligations or covenants among or between the Company and
Delaware previously or currently in effect.
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If the Service Agreement is consistent with your understanding of the matters we
discussed concerning the Company's provision of the services, please sign below:
Date: THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
-------------------------
By:
---------------------------------------
Name: Rise X. X. Xxxxxx
Title: Vice President
Date: DELAWARE MANAGEMENT COMPANY,
------------------------- A SERIES OF DELAWARE MANAGEMENT
BUSINESS TRUST
By:
---------------------------------------
Name:
Title:
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EXHIBIT A
SERVICE FEES
The Service Fee shall be calculated on the average daily value of the shares of
the Trust in each Fund held in the Separate Accounts, beginning May 1, 2003
according to the following:
Aggressive Growth Fund
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Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2374% 0 - $200,000,000
.1874% on $200,000,001 to $250,000,000
.2374% on $250,000,001 to $400,000,000
.1874% on $400,000,001 and above
Bond Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.3003% 0 - $200,000,000
.2203% on $200,000,001 to $400,000,000
.1203% on $400,000,001 and above
Capital Appreciation Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.1874% 0 - $100,000,000
.2374% on $100,000,001 to $500,000,000
.2374% on $500,000,001 and above
Equity Income Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2574% 0 - $500,000,000
.2074% on $500,000,001 and above
Global Asset Allocation Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2674% 0 - $200,000,000
.2674% on $200,000,001 to $400,000,000
.2674% on $400,000,001 and above
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Growth & Income Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2800% 0 - $200,000,000
.2000% on $200,000,001 to $400,000,000
.1000% on $400,000,001 and above
International Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.4000% 0 - $200,000,000
.3500% on $200,000,001 to $400,000,000
.2000% on $400,000,001 and above
Managed Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2891% 0 - $200,000,000
.2091% on $200,000,001 to $400,000,000
.1091% on $400,000,001 and above
Money Market Fund
---------------------------------------------------------------------
Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.3003% 0 - $200,000,000
.2203% on $200,000,001 to $400,000,000
.1203% on $400,000,001 and above
Social Awareness Fund
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Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2800% 0 - $200,000,000
.2000% on $200,000,001 to $400,000,000
.1000% on $400,000,001 and above
Special Opportunities Fund
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Annual Rate Average Daily Value of Shares
------------------ --------------------------------------------------
.2800% 0 - $200,000,000
.2000% on $200,000,001 to $400,000,000
.1000% on $400,000,001 and above
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