X. XXXX PRICE ASSOCIATES, INC.
P.O. Box 89000
Baltimore, Maryland 21289-8220
Mail Code 8220
May 1, 2002 000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-1009
000-000-0000
Jefferson Pilot Financial Insurance Company 000-000-0000
Jefferson Pilot LifeAmerica Insurance Company Fax 000-000-0000
Legal Department
Ladies and Gentlemen:
This letter sets forth the agreement ("AGREEMENT") between Jefferson Pilot
Financial Insurance Company and Jefferson Pilot LifeAmerica Insurance Company
(collectively, "YOU" or the "COMPANY") and the undersigned ("WE" or "PRICE
ASSOCIATES") concerning certain administration services to be provided by you,
with respect to the [X. Xxxx Price Equity Series, Inc.] and [X. Xxxx Price Fixed
Income Series, Inc.] (the "FUND" and collectively, the "FUNDS").
1. THE FUND. The Fund is a Maryland Corporation registered with the
Securities and Exchange Commission (the "SEC") under the Investment Company
Act of 1940 (the "ACT") as an open-end diversified management investment
company. The Fund serves as a funding vehicle for variable annuity contracts
and variable life insurance contracts and, as such, sells its shares to
insurance companies and their separate accounts. With respect to various
provisions of the Act, the SEC requires that owners of variable annuity
contracts and variable life insurance contracts be provided with materials
and rights afforded to shareholders of a publicly-available SEC-registered
mutual fund.
2. THE COMPANY. Jefferson Pilot Financial Insurance Company is a
Nebraska insurance company and Jefferson Pilot LifeAmerica Insurance Company
is a New Jersey insurance company. The Company issues variable annuity and/or
variable life insurance contracts (the "CONTRACTS") supported by one or more
separate accounts (the "SEPARATE ACCOUNT") which is registered with the SEC
as a unit investment trust. The Company has entered into a participation
agreement (the "PARTICIPATION AGREEMENT") with the Fund pursuant to which the
Company purchases shares of the Fund for the Separate Account supporting the
Company's Contracts.
3. PRICE ASSOCIATES. Price Associates serves as the Fund's investment
adviser. Price Associates supervises and assists in the overall management of
the Fund's affairs under an Investment Management Agreement with the Fund,
subject to the overall authority of the Fund's Board of Directors in accordance
with Maryland law. Under the Investment Management Agreement, Price Associates
is compensated by the Fund for providing investment advisory and certain
administrative services (either directly or through its affiliates).
[X. Xxxx Price Logo]
4. ADMINISTRATIVE SERVICES. You have agreed to assist us and/or our
affiliates, as we may request from time to time, with the provision of
administrative services to the Fund, as they may relate to the investment in the
Fund by the Separate Account. It is anticipated that such services may include
(but shall not be limited to): the mailing of Fund reports, notices, proxies and
proxy statements and other informational materials to holders of the Contracts
supported by the Separate Account; the transmission of purchase and redemption
requests to the Fund's transfer agent; the maintenance of separate records for
each holder of the Contracts reflecting shares purchased and redeemed and share
balances; the preparation of various reports for submission to the Fund
Directors; the provision of advice and recommendations concerning the operation
of the series of the Fund as funding vehicles for the Contracts; the provision
of shareholder support services with respect to the Portfolios serving as
funding vehicles for the Company's Contracts; telephonic support for holders of
Contracts with respect to inquiries about the Fund; and the provision of other
administrative services as shall be mutually agreed upon from time to time.
5. PAYMENT FOR ADMINISTRATIVE SERVICES. In consideration of the services
to be provided by you, we shall pay you on a monthly basis ("PAYMENTS"), from
our assets, including our BONA FIDE profits as investment adviser to the
Fund, an amount equal to [__] basis points ([___]%) per annum of the average
aggregate net asset value of shares of the Funds held by the Separate Account
under the Participation Agreement, PROVIDED, HOWEVER, that such payments
shall only be payable for each calendar month during which the total dollar
value of shares of the Funds purchased pursuant to the Participation
Agreement exceeds $25,000,000. For purposes of computing the payment to the
Company contemplated under this Paragraph 5, the average aggregate net asset
value of shares of the Funds held by the Separate Account over a monthly
period shall be computed by totaling the Separate Account's aggregate
investment (share net asset value multiplied by total number of shares held
by the Separate Account) on each business day during the calendar month, and
dividing by the total number of business days during such month. The payment
contemplated by this Paragraph 5 shall be calculated by Price Associates at
the end of each calendar month and will be paid to the Company within 30
calendar days thereafter.
6. NATURE OF PAYMENTS. The parties to this Agreement recognize and agree
that Price Associates Payments to the Company under this Agreement represent
compensation for administrative services only and do not constitute payment in
any manner for investment advisory services or for costs of distribution of the
Contracts or of Fund shares; and further, that these payments are not otherwise
related to investment advisory or distribution services or expenses, or
administrative services which Price Associates is required to provide to owners
of the Contracts pursuant to the terms thereof. You represent that you may
legally receive the payments contemplated by this Agreement.
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7. TERM. This Agreement shall remain in full force and effect for an
initial term of one year, and shall automatically renew for successive one-year
periods unless either party notifies the other upon 60-days written notice of
its intent not to continue this agreement. This Agreement and all obligations
hereunder shall terminate automatically upon the redemption of the Company's and
the Separate Account's investment in the Fund, or upon termination of the
Participation Agreement.
8. AMENDMENT. This Agreement may be amended only upon mutual agreement of
the parties hereto in writing.
9. COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which shall together constitute one
and the same instrument.
If this Agreement is consistent with your understanding of the
matters we discussed concerning your administration services, kindly sign
below and return a signed copy to us.
Very truly yours,
X. XXXX PRICE ASSOCIATES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxx
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Title: Vice President
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Acknowledged and Agreed to:
JEFFERSON PILOT FINANCIAL INSURANCE
COMPANY
By: /s/ Xxxxx X. Xxxxx
-------------------------
Name: Xxxxx X. Xxxxx
-----------------------
Title: Vice President
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XXXXXXXXX PILOT LIFEAMERICA INSURANCE
COMPANY
By: /s/ Xxxxx X. Xxxxx
-------------------------
Name: Xxxxx X. Xxxxx
-----------------------
Title: Vice President
----------------------
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