SERVICES AGREEMENT
THIS SERVICES AGREEMENT (the "Agreement") is made as of August 15, 1996, by
and among Delaware Management Holdings, Inc., a Delaware corporation
("Holdings"), Delaware Service Company, Inc., a Delaware corporation and a
wholly owned subsidiary of Holdings ("Delaware"), Lincoln National Life
Insurance Company, an Indiana insurance corporation ("Lincoln Life"), and each
of the investment companies listed in EXHIBIT A hereto, each a Maryland
corporation (together with any other investment company designated in accordance
with Section 5.1, the "Funds," or individually, a "Fund").
The parties hereto, in consideration of the mutual covenants hereinafter
expressed, agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1 DEFINITIONS. The following terms shall have the respective
meanings set forth in this Section 1.1 for all purposes of this Agreement except
where the application of such definitions is limited by reference in this
Section 1.1 to a specific Article of this Agreement (such definitions to be
equally applicable to both the singular and plural forms of the terms herein
defined):
"Acceptance Test" means a test, reasonably acceptable to Lincoln Life,
Delaware and the Funds, of the performance of the Value Calculation Services for
the Accounts included in the respective Phases, to be conducted in accordance
with Article 4.
"Accounting Services" means the services listed in the Cutover Schedule
with respect to the Accounts.
"Accounts" means the Funds and the Separate Accounts, collectively.
"Affiliate" means, with respect to any entity, any other entity
controlling, controlled by or under common control with such entity.
"Business Day" means a day on which the New York Stock Exchange is open for
trading.
"Calculation Losses" means any losses suffered by a Contractowner, Third
Party Administrator, Fund or Separate Account directly caused by an error in a
Net Asset Value or Unit Value, or by the delivery to Lincoln Life or any Fund of
a Net Asset Value or Unit Value after the applicable deadline provided for in
Section 2.1; provided, however, that such losses shall not
include any consequential damages.
"Contractowner" means the present or former owner of an insurance or
annuity contract supported by a Separate Account, or any beneficiary or
annuitant thereof.
"Cutover Date," with respect to any Phase, means the date, which shall be a
Business Day, on which Delaware actually commences providing the Accounting
Services with respect to such Phase in accordance with Section 4.2. The planned
Cutover Date for each Phase is set forth in the Cutover Schedule.
"Cutover Schedule" means SCHEDULE 1.1(a) hereto, which sets forth the
accounting services to be rendered pursuant to this Agreement and the planned
Cutover Dates, as such Schedule may be amended from time to time pursuant to
Section 16.1.
"Delaware" has the meaning set forth in the preamble to this Agreement.
"Delaware Affiliate" means Holdings and any entity that is directly or
indirectly controlled by Holdings.
"Fee Schedule" means SCHEDULE 6.1 hereto, as such Schedule may be amended
from time to time pursuant to Section 16.1.
"Fund" has the meaning set forth in the preamble to this Agreement.
"Holdings" has the meaning set forth in the preamble to this Agreement.
"Lincoln Affiliate" means any Affiliate of Lincoln Life other than a
Delaware Affiliate.
"Lincoln Life" has the meaning set forth in the preamble to this Agreement.
"Net Asset Value" means the daily net asset value per share of the
respective Funds for each Business Day, all determined in accordance with the
terms of the Cutover Schedule and with any applicable prospectus or regulatory
requirement.
"Phase" means a set of Accounts comprising the Phase I Accounts, the Phase
II Accounts or the Phase III Accounts.
"Phase I Account" means an Account designated as such on the Cutover
Schedule.
"Phase II Account" means an Account designated as such on the Cutover
Schedule.
"Phase III Account" means an Account designated as such on the Cutover
Schedule.
"Renewal Term" means each successive one-year term occurring after the
expiration of the initial term of this Agreement as described in Section 11.1.
"Separate Account" means a separate account of Lincoln Life identified as
such on the Cutover Schedule, and any additional separate account or sub-account
of Lincoln Life or any Lincoln Affiliate (or of any other person if Lincoln Life
or any Lincoln Affiliate has administrative responsibilities with respect to
such separate account or sub-account pursuant to any reinsurance agreement or
otherwise) designated in accordance with Section 5.1.
"Test Period" means, with respect to each Phase, a period of time prior to
the Cutover Date for such Phase, commencing on the date specified by Delaware
pursuant to Section 4.1 and having a duration of three weeks or such longer
period as may be determined pursuant to Section 4.1.
"Third Party Administrator" means an administrator of insurance or annuity
contracts acting on behalf of Contractowners.
"Unit Value" means the daily unit value per unit of the respective Separate
Accounts or sub-accounts thereof for each Business Day, all determined in
accordance with the terms of the Cutover Schedule and with any applicable
prospectus or regulatory requirement.
"Value Calculation Services" means those Accounting Services consisting of
or incidental to the calculation and communication of Unit Values and Net Asset
Values in accordance with the terms of this Agreement.
ARTICLE 2
SCOPE OF SERVICES; CUTOVER
Section 2.1 SCOPE OF SERVICES. Delaware shall provide the Accounting
Services to each of the Funds and to Lincoln Life with respect to each of the
Separate Accounts, all in accordance with the terms of this Agreement. Without
limiting the generality of the foregoing, from and after the Cutover Date for
each respective Phase, Delaware, no later than 6:00 p.m. (New York City time) on
each Business Day, shall in accordance with the terms of this Agreement provide
to Lincoln Life and to the Funds the Value Calculation Services for each of the
Accounts included in such Phase. In the event of any error in the Value
Calculation Services, the parties hereto will follow the procedures set forth in
SCHEDULE 2.1, without prejudice to any other rights described in this Agreement.
Section 2.2 CUTOVER SCHEDULE. Delaware, Lincoln Life and the Funds shall
use their respective best efforts to cause the Cutover Date to occur no later
than (a) August 15, 1996, with respect to the Phase I Accounts, (b) October 31,
1996, with respect to the Phase II Accounts and (c) January 1, 1997 with respect
to the Phase III Accounts.
ARTICLE 3
LINCOLN LIFE'S SUPPORT OBLIGATIONS
Section 3.1 PROVISION OF DATA. Lincoln Life shall use its best efforts to
provide or cause to be provided to Delaware the data identified in SCHEDULE 3.1
during the periods and in accordance with the procedures identified in such
Schedule, it being understood that Delaware shall not be responsible for any
Calculation Losses or other claims, suits, hearings, actions, damages,
liabilities, fines, penalties, costs, losses or expenses, including reasonable
attorney's fees, which any party may sustain or incur, directly or indirectly,
in each case to the extent caused by or arising from Lincoln Life's failure to
provide such data in accordance with such SCHEDULE 3.1.
Section 3.2 DATA TO BE PROVIDED BY THIRD PARTIES. With respect to each of
the mutual funds identified in SCHEDULE 3.2 as an available investment of one or
more of the Separate Accounts (other than mutual funds managed by Lincoln Life
or Delaware or their respective Affiliates) and each third party service
provider identified in such Schedule, Lincoln Life shall direct each of the
managers of such funds or such service provider, as the case may be, to provide
or cause to be provided to Delaware the data identified in SCHEDULE 3.2 in
accordance with the procedures and time deadlines identified in such Schedule.
Section 3.3 INFORMATION FOR PERIODS PRIOR TO CUTOVER DATE. Lincoln Life
will provide appropriate financial and other information with respect to the
Accounts to Delaware, and will cooperate with Delaware, in connection with the
preparation of data for 1996 annual reports to Contractowner and other elements
of the Accounting Services that relate to periods prior to the Cutover Dates for
the respective Accounts. In addition, Lincoln Life will provide to Delaware
appropriate financial and other information regarding the Accounts for periods
prior to 1996 to the extent relevant to the performance of the Accounting
Services for 1996 and subsequent periods.
ARTICLE 4
ACCEPTANCE TEST; CUTOVER DATE
Section 4.1 ACCEPTANCE TESTING. Delaware shall notify Lincoln Life of the
date, which shall be a Business Day, on which the Value Calculation Services for
each respective Phase will be ready for the commencement of the Acceptance Test
for such Phase. During the Test Period for each Phase, Delaware, Lincoln Life
and the Funds shall cooperate in performing the Acceptance Test for such Phase,
and Delaware and Lincoln Life, respectively, shall use its best efforts to
remedy any failure in the performance of the Value Calculation Services caused
by such party. In the event that, during the Test Period with respect to any
Phase, performance of the Value Calculation Services is suspended for such Phase
in order to effect such remedy or for any other reason, the Test Period for such
Phase shall be extended by the number of days of such suspension. Further, if at
the date that would otherwise be the end of the Test Period for any Phase
Delaware is not performing the Value Calculation Services with respect to such
Phase to the reasonable satisfaction of Lincoln Life, and Lincoln Life shall so
notify Delaware, the Test Period shall be extended until the date on which
Lincoln Life notifies Delaware that the Value Calculation Services are being
performed to the reasonable satisfaction of Lincoln Life. All references in this
Section 4.1 to the performance of the Value Calculation Services shall refer to
the performance thereof in a test mode.
Section 4.2 CUTOVER DATE. With respect to each Phase, upon the termination
of the Test Period, Lincoln Life, the Funds and Delaware shall execute a written
acknowledgment in the form of EXHIBIT B hereto confirming such termination and
specifying the Cutover Date, which shall be the Business Day immediately
following the date of such termination unless Lincoln Life, the Funds and
Delaware shall agree upon a different date.
ARTICLE 5
NEW ACCOUNTS; NEW INVESTMENT MANAGERS
Section 5.1 ADDITIONAL ACCOUNTS. Lincoln Life may from time to time
designate (i) one or more additional investment companies or separate accounts
to constitute Funds or Separate Accounts, as the case may be, for all purposes
of this Agreement, or (ii) one or more newly established sub-accounts of any
Separate Account. Such designation shall be:
(a) subject to Delaware's consent, which shall not be unreasonably
withheld; provided, that such consent shall be considered to be
unreasonably withheld if Delaware does not make reasonable
efforts to accept such new investment companies, separate
accounts and sub-accounts, which efforts shall include, but not
be limited to, reasonable consideration of the expansion of
Delaware's infrastructure to handle such new investment
companies, separate accounts and sub-accounts; and
(b) evidenced by a writing executed by Lincoln Life, Delaware and,
if applicable, each such investment company, setting forth the
name of such investment company, separate account or new
sub-account, the applicable rate under the Fee Schedule that
shall apply to the Accounting Services for such investment
company, separate account or new sub-account, the effective
date of the designation thereof as a Fund, Separate Account or
new sub-account, and any other matters the parties wish to
include.
Notwithstanding clause (b) of the preceding sentence, if Delaware's performance
of the Accounting Services for such additional Funds, Separate Accounts, or
sub-accounts of such Separate Accounts would, in Delaware's reasonable opinion,
result in higher costs than the costs Delaware incurs for providing the
Accounting Services to the current Accounts, then the affected parties hereto
shall negotiate in good faith an addendum to the Fee Schedule for such
additional Funds, Separate Accounts and sub-accounts and Delaware shall not be
deemed to have unreasonably withheld its consent under clause (b) of this
Section 5.1 until such addendum has been agreed to. Except as otherwise
specified in such writing, from and after such effective date, Delaware shall
provide to such Fund, or to Lincoln Life with respect to a Separate Account or
new sub-account, the same Accounting Services as are specified in the Cutover
Schedule with respect to the other Funds, Separate Accounts or sub-account of a
Separate Account, as the case may be.
Section 5.2 NEW INVESTMENT MANAGERS. If new investment managers are added
to provide investment advisory services to any of the Accounts, and Delaware's
performance of the Accounting Services is, as a result thereof, significantly
more costly to Delaware, the affected parties shall negotiate in good faith an
addendum to the Fee Schedule for such Accounts.
ARTICLE 6
FEES
Section 6.1 ACCRUAL OF FEES. From and after the Cutover Date with respect
to each Phase, Lincoln Life shall pay fees for the Accounting Services for each
of the Separate Accounts included in such Phase, and each Fund included in such
Phase shall pay fees for the Accounting Services for such Fund, in each case at
the respective rates per annum determined in accordance with the Fee Schedule.
Fees accrued pursuant to this Section 6.1 shall be payable in arrears on a
monthly basis.
Section 6.2 PAYMENT OF FEES BY LINCOLN LIFE. Delaware shall submit to
Lincoln Life an invoice for each month for all of
the fees payable pursuant to Section 6.1 with respect to each of the Separate
Accounts, which invoice shall be itemized to show the portion of such fees
allocable to each of the Separate Accounts in accordance with the Fee Schedule.
Subject to the terms of this Agreement, invoices for such fees shall be payable
within 30 days of receipt.
Section 6.3 PAYMENT OF FEES BY THE FUNDS. Delaware shall submit to each
Fund, with a copy to Lincoln Life, an invoice for each month for all of the fees
payable pursuant to Section 6.1 with respect to such Fund. Subject to the terms
of this Agreement, invoices for such fees shall be payable within 30 days of
receipt.
ARTICLE 7
STANDARD OF CARE; INDEMNIFICATION
Section 7.1 STANDARD OF CARE. Delaware shall provide the Accounting
Services with a level of care equal to or greater than the level of care at
which it performs similar functions for mutual funds that are sponsored or
managed by any Delaware Affiliate, and in any event, Delaware shall always
exercise reasonable care in performing the Accounting Services.
Section 7.2 INDEMNIFICATION
(a) INDEMNIFICATION BY LINCOLN LIFE. Lincoln Life shall indemnify, defend
and hold harmless Delaware and any Delaware Affiliate, and the directors,
officers and employees of the foregoing (each individually, a "Delaware
Indemnified Party"), against any and all claims, suits, hearings, actions,
damages, liabilities, fines, penalties, costs, losses or expenses, including
reasonable attorney's fees, which any Delaware Indemnified Party may sustain or
incur, directly or indirectly, in each case to the extent caused by or arising
from (i) the negligence, recklessness or intentional misconduct of Lincoln Life
or any Lincoln Affiliate, or any director, officer or employee thereof, in the
performance of this Agreement; or (ii) the failure of Lincoln Life to comply
with the terms of this Agreement.
(b) INDEMNIFICATION BY DELAWARE. Subject to Section 3.1, Delaware shall
indemnify, defend and hold harmless Lincoln Life, the Lincoln Affiliates and the
Funds, and the directors, officers and employees of the foregoing (each
individually, a "Lincoln Indemnified Party") against any and all claims, suits,
hearings, actions, damages, liabilities, fines, penalties, costs, losses
(including but not limited to (a) Calculation Losses reimbursed by Lincoln Life
and (b) any market fluctuation losses incurred by Lincoln Life in effecting such
reimbursement) or expenses, including reasonable attorney's fees, which any
Lincoln Indemnified Party may sustain or incur, directly or indirectly, in each
case to the extent caused by or arising from (i) the negligence, recklessness or
intentional misconduct of Delaware or any Delaware Affiliate, or any director,
officer or employee thereof, in the performance of this Agreement; or (ii) the
failure of Delaware to comply with the terms of this Agreement.
(c) PROCEDURES. Subject to the provisions of Section 7.2(d), promptly
after receipt by a Delaware Indemnified Party or a Lincoln Indemnified Party
(each, an "Indemnified Party") of notice of the commencement of any action,
proceeding, investigation or claim by any Contractowner or other third party (a
"Proceeding"), the Indemnified Party shall, if a claim in respect thereof is to
be made pursuant to this Section 7.2 against another party to this Agreement
(the "Indemnifying Party"), notify the Indemnifying Party in writing of the
commencement thereof; but the failure so to notify the Indemnifying Party shall
not relieve the Indemnifying Party from any liability under this Section 7.2,
except to the extent that such failure to notify actually prejudices the
Indemnifying Party. In case any such Proceeding shall be brought against an
Indemnified Party, the Indemnifying Party shall be entitled to participate in
and to assume the defense thereof, with counsel satisfactory to the Indemnified
Party, and after notice from the Indemnifying Party to the Indemnified Party of
the Indemnifying Party's election to assume the defense thereof, the
Indemnifying Party shall not be liable to the Indemnified Party for any legal or
other expenses subsequently incurred by the Indemnified Party in connection with
the defense thereof other than reasonable costs of investigation; provided,
however, that (i) if, in the reasonable judgment of the Indemnified Party, it is
advisable for the Indemnified Party to be represented by separate counsel other
than counsel for the Indemnifying Party, the Indemnified Party shall have the
right to employ a single counsel to represent the Indemnified Party, in which
event the reasonable fees and expenses of such separate single counsel shall be
borne by the Indemnifying Party, and (ii) in the case of any Proceeding brought
by any governmental authority, the Indemnifying Party shall have the right to
participate in, but not to assume the defense of, such Proceeding. The
Indemnifying Party shall not be obligated under any settlement agreement
relating to any Proceeding under this Section 7.2 to which it has not consented
in writing, which consent shall not be unreasonably withheld.
(d) PRESERVING RIGHTS WITH RESPECT TO CALCULATION LOSSES. Notwithstanding
Section 7.2(c), Lincoln Life may in its sole discretion elect to reimburse a
Contractowner, Third Party Administrator, Separate Account or Fund for
Calculation Losses out of Lincoln Life's own funds and such reimbursement shall
have no effect on the respective indemnification obligations of the parties
pursuant to Section 7.2(a) and (b).
(e) OVERPAYMENTS. The parties agree that there may be circumstances in
which it would not be commercially reasonable for Lincoln Life and the Funds to
seek reimbursement from one or more Contractowners of overpayments made them,
taking into account relevant factors such as industry practice; the amount of
such overpayments; the number of Contractowners overpaid; the cost of seeking
reimbursement; and the implications for customer relations of seeking
reimbursement. In the event of any overpayment to a Contractowner for which
Lincoln Life or any Fund intends to seek indemnification from Delaware pursuant
to Section 7.2(b) without seeking reimbursement from the Contractowner, the
parties shall negotiate in good faith as to what effect, if any, the
determination not to seek such reimbursement should have under the circumstances
on the rights of Lincoln Life or the Funds to indemnification for the amounts
overpaid.
ARTICLE 8
INSURANCE COVERAGE
Section 8.1 INSURANCE. Delaware and Holdings shall maintain insurance
coverage at a level at least equal to the insurance coverage held by each of
them at the time this Agreement becomes effective.
ARTICLE 9
FORCE MAJEURE AND DISASTER RECOVERY PLAN
Section 9.1 FORCE MAJEURE; DISASTER RECOVERY PLAN. No party shall be
liable to any other party for any damages caused by delays beyond its reasonable
control, including, without limitation, those delays occasioned by fire, strike,
labor dispute, acts of the other party, acts of any common carrier, pricing
service, corporate action service, or telephone network, acts of the power
supply company or its networks, restrictions by civil or military authorities,
acts of nature, or unforeseen transportation failures. In the event of any such
delay, the hindered party shall promptly notify the other parties and, upon the
giving of such notice, the period of time for performance of obligations
hereunder affected by such delays will be extended by the same number of days as
the delay. Notwithstanding the foregoing, Delaware shall maintain and implement
a customary disaster recovery plan and such plan shall be reasonably acceptable
to Lincoln Life and the Funds. This Article 9 shall not excuse any failure to
perform, or extend the time for performance of, any
obligation of Delaware under this Agreement to the extent that such failure or
delay would have been avoided by compliance with such disaster recovery plan, or
by the use of reasonable, readily available alternatives.
ARTICLE 10
EFFECTIVENESS
Section 10.1 EFFECTIVENESS.
(a) This Agreement shall become effective upon the later of:
(i) the date first set forth above; or
(ii) the date as of which Lincoln Life has complied with the
requirements of the Indiana insurance holding company
laws at Section 27-1-23-4 of the Indiana Code.
(b) Lincoln Life shall diligently and reasonably pursue the
satisfaction of the requirements of the Indiana insurance
holding company laws at Section 27-1-23-4 of the Indiana Code.
ARTICLE 11
TERM AND TERMINATION
Section 11.1 TERM. The initial term of this Agreement shall end on the
fourth anniversary of the Cutover Date of Phase III, and this Agreement shall be
automatically renewed for subsequent Renewal Terms thereafter unless sooner
terminated under Section 11.2.
Section 11.2 TERMINATION. Subject to the procedures set forth in
Article 12 and to Section 11.3, this Agreement may be terminated as follows:
(a) by Lincoln Life, Delaware, or any Fund, in each case upon
notice to each of the other parties at least 180 days prior to
the expiration of the initial term or any Renewal Term, with
such termination to become effective upon such expiration; and
(b) by Lincoln Life, Delaware or any Fund upon 30 days notice to
each of the other parties, for any material breach of this
Agreement unless such breach is cured within such notice
period.
For the purpose of this Section 11.2(b) only, a "material breach" shall include,
but not be limited to, the failure by Delaware to
provide Accounting Services hereunder of a quality reasonably determined by
Lincoln Life or any Fund to be consistent with a superior level of service in
the industry.
Section 11.3 EFFECT OF TERMINATION BY A FUND. In the event one or more
Funds shall terminate this Agreement, this Agreement shall nonetheless continue
in full force and effect between and among those parties who have not terminated
this Agreement.
ARTICLE 12
PROCEDURES UPON TERMINATION
Section 12.1 OBLIGATIONS UPON TERMINATION. Upon termination of this
Agreement by any party under Article 11, each party shall be obligated to
cooperate with each other party to provide for the transfer of all
responsibilities, duties and obligations of this Agreement as may be necessary
to ensure the orderly, undisrupted business of each party. Such cooperation
shall include, but not be limited to, returning all papers, documents, materials
or equipment to the party owning such materials. In the event that this
Agreement is terminated by Lincoln Life or any Fund under Section 11.2(b),
Lincoln Life and the Funds shall have the right to require Delaware to continue
performing all or any part of its responsibilities, duties and obligations under
this Agreement until the earlier of (a) 210 days following the date notice of
such termination was given, or (b) the date that is 30 days after notice from
Lincoln Life or the Funds that Delaware shall cease such performance. For this
purpose, (a) the terms of this Agreement (including without limitation the
obligation of Lincoln Life and the Funds to pay Delaware's fees under Article 6,
and the obligation of Delaware to continue to exercise the standard of care
required under Section 7.1 shall remain in effect with respect to the period in
which Delaware is obligated to continue such performance, and (b) if any portion
of Delaware's responsibilities, duties and obligations during such period are
not so extended as required by Lincoln Life, the parties shall mutually agree in
good faith on a reduction of fees which reflects the termination of such
responsibilities, duties and obligations.
ARTICLE 13
REPRESENTATIONS AND WARRANTIES
Each party represents and warrants to the other parties as follows:
Section 13.1 ORGANIZATION AND AUTHORITY. Such party is duly organized,
validly existing and in good standing as a corporation under the laws of the
state indicated on the first page of this Agreement, with the requisite
authority and power, in conformity with applicable laws, rules and regulations,
to execute and deliver this Agreement and to perform its obligations
hereunder. Such party has taken all necessary action to authorize such
execution, delivery and performance.
Section 13.2 NO CONFLICT WITH LAWS. The execution, delivery and
performance of this Agreement by such party do not conflict with or violate any
laws applicable to such party, any provision of its constituent documents, any
order or judgment of any court or governmental agency applicable to it or any of
its assets or any contractual restriction binding on it or its assets.
Section 13.3 OBLIGATION. This Agreement constitutes a legal, valid and
binding obligation of such party, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws relating to the enforcement of creditors' rights generally and
subject to principles of equity.
ARTICLE 14
PARENT GUARANTY
Section 14.1 PARENT GUARANTY. Holdings hereby unconditionally guarantees
the full and punctual performance of the covenants, agreements and obligations
of Delaware under this Agreement, including but not limited to the payment when
due of all amounts that may from time to time be payable by Delaware pursuant to
Section 7.2(b) (the "Guaranteed Obligations").
Section 14.2 GUARANTY UNCONDITIONAL. The obligations of Holdings hereunder
shall be unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released or discharged by:
(a) any extension, settlement, compromise, waiver or release in
respect of any obligation of Delaware under this Agreement;
(b) any modification or amendment of or supplement to this
Agreement;
(c) any change in the corporate existence, structure or ownership
of Delaware, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting Delaware or its assets; or
(d) any other act or omission to act or delay of any kind by
Delaware, Lincoln Life, any Fund or any other person which would, but for
the provisions of this paragraph (d), constitute a legal or equitable
discharge of Holding's obligations hereunder;
provided, however, that in the event of any extension, settle-
ment, compromise, waiver or release of any obligation of Delaware under this
Agreement, or any modification or amendment of or supplement to this Agreement,
the guaranty provided for in this Article 14 shall apply to the obligations of
Delaware as so extended, settled, compromised, waived, released, modified,
amended or supplemented.
Section 14.3 DISCHARGE ONLY UPON PAYMENT OR PERFORMANCE IN FULL;
REINSTATEMENT IN CERTAIN CIRCUMSTANCES. Holding's obligations hereunder shall
remain in full force and effect until the Guaranteed Obligations shall have been
paid or performed in full. If at any time any payment of Guaranteed Obligations
by Delaware under this Agreement is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of Delaware or
otherwise, Holding's obligations hereunder with respect to such payment shall be
reinstated as though such payment had been due but not made at such time.
Section 14.4 WAIVER BY HOLDINGS. Holdings irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by any person
against Delaware or any other person.
Section 14.5 SUBROGATION. Upon making any payment with respect to Delaware
hereunder, Holdings shall be subrogated to the rights of the payee against
Delaware with respect to such payment; provided that Holdings shall not enforce
payment by way of subrogation until all Guaranteed Obligations have been paid or
performed in full.
ARTICLE 15
DISPUTE RESOLUTION
Before commencing litigation of any dispute arising out of or relating to
this Agreement, the parties shall attempt in good faith to resolve the dispute
by the following means:
Section 15.1 NEGOTIATION. The parties shall in good faith attempt to
resolve any dispute arising out of or relating to this Agreement promptly by
negotiations between executives who have authority to settle the controversy. A
party may give the other parties written notice of any dispute not resolved in
the normal course of business. Within 20 days after delivery of that notice,
executives of the affected parties shall meet at a mutually acceptable time and
place, and thereafter as often as they reasonably deem necessary, to exchange
relevant information and to attempt to resolve the dispute. If the matter has
not been resolved within 60 days of the disputing party's notice, or if the
parties fail to meet within 20 days, either party may initiate mediation of the
controversy or claim as provided in Section 15.2. If a negotiator intends to be
accompanied at a
meeting by an attorney, the other negotiator shall be given at least 3 Business
Days' notice of that intention and may also be accompanied by an attorney.
Section 15.2 MEDIATION. If the dispute has not been resolved by
negotiation as provided in Section 15.1, the parties shall endeavor for an
additional period of 60 days to settle the dispute by mediation under the
then-current Center for Public Resources (CPR) Model Procedure for Mediation of
Business Disputes. The neutral third party will be selected from the CPR Panel
of Neutrals. If the parties encounter difficulty in agreeing on a neutral, they
will seek the assistance of CPR in the selection process.
Section 15.3 CONFIDENTIALITY. All activities under this Article 15 are
confidential and shall be treated as compromise and settlement negotiations for
purposes of the Federal Rules of Evidence and state rules of evidence.
ARTICLE 16
MISCELLANEOUS
Section 16.1 AMENDMENT. This Agreement, including any Exhibits or
Schedules, may be amended, modified or supplemented only in writing signed by
Delaware, Lincoln Life and any Fund affected thereby. This Agreement shall be
binding upon all successors, assigns or transferees of the parties to this
Agreement.
Section 16.2 ASSIGNMENT. This Agreement and the rights, duties and
obligations of the parties hereto shall not be assignable by any party, except
assignment to successors in the case of mergers, sales of all or substantially
all of the assets of such party or transfer of ownership by reorganization or
similar restructuring to a successor in interest to the business of such party,
without the prior written consent of the other parties, and any purported
assignment in the absence of such consent shall be void.
Section 16.3 NOTICES. All notices given or submitted pursuant to this
Agreement shall be made in writing and shall be deemed given when (a) deposited
with the United States Postal Service, postage prepaid, registered or certified
mail, return receipt requested; (b) deposited with a nationally recognized
overnight mail delivery service; (c) sent by facsimile with electronic
confirmation of delivery or with a copy sent by mail as described in (a) or (b)
above; or (d) delivered in person; all to the last address of record of each
party being notified.
Any notice under this Agreement to Lincoln Life shall be given to:
ATTN: O. Xxxxxxx Xxxxxxxxxxx
Vice President and Controller
Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Any notice under this Agreement to Delaware or Holdings shall be given to:
ATTN: Xxxxxxx X. Xxxxxx
Vice President and Treasurer
Delaware Management Company
0000 Xxxxxx Xxxxxx; 0xx Xxxxx
Xxxxxxxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxxxx X. Xxxxxxxx
Managing Director, Corporate
& Tax Affairs
Delaware Management Company
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Any notice under this Agreement to any Fund shall be given to:
ATTN: Xxxxx X. Xxxxxxxxx
Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Any party may, by means of written notice in compliance with this
Section 16.3, change the address or the identity of the person to whom any
notice, or copy thereof, is to be sent.
Section 16.4 SEVERABILITY. If any provision of this Agreement, as applied
to any party or to any circumstances, shall
be found by a court of competent jurisdiction to be void, invalid or
unenforceable, the same shall in no way affect any other provision of this
Agreement, the application of any such provision in any other circumstances, or
the validity or enforceability of this Agreement; provided, however, that
nothing in this Section 16.4 shall adversely affect the fundamental benefits
received by the parties under this Agreement.
Section 16.5 WAIVER. A waiver by any party of any of the terms and
conditions of this Agreement in any one instance shall not be deemed or
construed to be waiver of any such term or condition for the future, or of any
subsequent breach thereof, nor shall it be deemed a waiver of performance of any
other obligation hereunder. No waiver of any provision of this Agreement shall
be valid unless agreed to in writing by the party or parties against whom such
waiver is sought to be enforced.
Section 16.6 ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the parties hereto relating to the subject matter of this
Agreement and supersedes all prior and collateral agreements, understandings,
statements and negotiations of the parties.
Section 16.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Indiana, without giving
effect to the conflict of law provisions thereof.
Section 16.8 SECTION AND PARAGRAPH HEADINGS. The titles of the sections
and paragraphs of this Agreement are for convenience only and shall not in any
way affect the interpretation of any provision or condition of this Agreement.
Section 16.9 COUNTERPARTS. This Agreement may be executed in counterparts
which, taken together, shall constitute the whole of the Agreement as between
the parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first written above.
LINCOLN LIFE:
LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: /s/ O. Xxxxxxx Xxxxxxxxxxx
--------------------------
O. Xxxxxxx Xxxxxxxxxxx
Title: Vice President and
Controller
Date:
--------------------------
HOLDINGS:
DELAWARE MANAGEMENT HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
--------------------
Title: Executive Vice President &
Chief Operating Officer
Date: August 15, 1996
DELAWARE:
DELAWARE SERVICE COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------
Title: Vice President & Treasurer
Date: August 15, 1996
FUNDS:
LINCOLN NATIONAL AGGRESSIVE GROWTH
FUND, INC.
LINCOLN NATIONAL BOND FUND, INC.
LINCOLN NATIONAL CAPITAL APPRECIATION
FUND, INC.
LINCOLN NATIONAL EQUITY-INCOME
FUND, INC.
LINCOLN NATIONAL GLOBAL ASSET ALLOCATION
FUND, INC.
LINCOLN NATIONAL GROWTH AND INCOME
FUND, INC.
LINCOLN NATIONAL INTERNATIONAL FUND,
INC.
LINCOLN NATIONAL MANAGED FUND, INC.
LINCOLN NATIONAL MONEY MARKET FUND, INC.
LINCOLN NATIONAL SOCIAL AWARENESS FUND,
INC.
LINCOLN NATIONAL SPECIAL OPPORTUNITIES
FUND, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------
Xxxxx X. Xxxxxxxxx
In his capacity as President of
each of the above-named Funds.
EXHIBIT A
---------------------------------------
INVESTMENT COMPANIES
EXHIBIT A
INVESTMENT COMPANIES
Lincoln National Aggressive Growth Fund, Inc.
Lincoln National Bond Fund, Inc.
Lincoln National Capital Appreciation Fund, Inc.
Lincoln National Equity-Income Fund, Inc.
Lincoln National Global Asset Allocation Fund, Inc.
Lincoln National Growth and Income Fund, Inc.
Lincoln National International Fund, Inc.
Lincoln National Managed Fund, Inc.
Lincoln National Money Market Fund, Inc.
Lincoln National Social Awareness Fund, Inc.
Lincoln National Special Opportunities Fund, Inc.
EXHIBIT B
FORM OF WRITTEN ACKNOWLEDGEMENT OF CUTOVER DATE
EXHIBIT B
FORM OF ACKNOWLEDGMENT OF CUTOVER DATE
This acknowledgement is executed pursuant Section 4.2 of that certain
Services Agreement (the "Agreement") dated as of July __, 1996 by and among
Delaware Management Holdings, Inc., Delaware Service Company, Inc., Lincoln
National Life Insurance Company, Lincoln National Aggressive Growth Fund, Inc.,
Lincoln National Bond Fund, Inc., Lincoln National Capital Appreciation Fund,
Inc., Lincoln National Equity-Income Fund, Inc., Lincoln National Global Asset
Allocation Fund, Inc., Lincoln National Growth and Income Fund, Inc., Lincoln
National International Fund, Inc., Lincoln National Managed Fund, Inc., Lincoln
National Money Market Fund, Inc., Lincoln National Social Awareness Fund, Inc.,
and Lincoln National Special Opportunities Fund, Inc. Capitalized terms used
herein have the same meaning as in the Agreement.
Each of the parties signing this acknowledgment below hereby agrees
that the Test Period for Phase __ terminated on ________________ __, 1996. The
Cutover Date for providing the Accounting Service for Phase __ is
_________________ __, 1996.
LINCOLN NATIONAL LIFE INSURANCE COMPANY
By:
---------------------------------------
Title:
---------------------------------
Date:
---------------------------------
DELAWARE SERVICE COMPANY, INC.
By:
---------------------------------------
Title:
---------------------------------
Date:
---------------------------------
[EACH FUND]
By:
---------------------------------------
Title:
---------------------------------
Date:
---------------------------------
SCHEDULE 1.1 (a)
CUTOVER SCHEDULE
CUTOVER SCHEDULE
PHASE I (8/15/96 SCHEDULED CUTOVER DATE):
The following services will begin at the Cutover Date for Phase I and will
subsequently be provided by Delaware for the duration of the Service Agreement.
The Funds for which these services will be provided are as follows:
- Lincoln National Growth and Income Fund, Inc.
- Lincoln National Bond Fund, Inc.
- Lincoln National Money Market Fund, Inc.
- Lincoln National Managed Fund, Inc.
- Lincoln National Social Awareness Fund, Inc.
- Lincoln National Special Opportunities Fund, Inc.
DAILY NET ASSET VALUE CALCULATION SERVICES:
- Maintain Portfolio History
- Record portfolio purchases and sales
- Record corporate actions and capital changes
- Accrue interest, dividends and expenses
- Maintain income history for securities
- Determine distributions to shareholders
- Record and reconcile shareholder activity
- Book subscription, liquidations and dividend reinvestments
- Record settlements of shareholder activity
- Reconcile fund shares outstanding to transfer agent
- Value portfolios (Calculate the NAV for each fund portfolio)
- Verify Delaware's internal controls - pricing securities and
portfolios
- Disseminate NAVs and dividends to interested parties (Lincoln Life,
ICI, Morningstar, Lipper, etc.) as mutually agreed upon by
Lincoln Life & Delaware
- Resolve daily pricing &/or custody discrepancies
FINANCIAL REPORTING SERVICES:
- Commencing 12/31/96 prepare the following information for use in
the semi-annual and annual reports for shareholders:
- Prepare Statement of Net Assets, Statement of Operations and
Changes in Net Assets
- Work with external auditors on footnotes to the financial
statements,
- Workpapers for annual audit,
1
- Cooperate with external auditors, Lincoln Life Marketing &
printer
- Required ICI reporting as mutually agreed upon by Lincoln Life and
Delaware
- Prepare Statistical reports as necessary (daily, monthly, quarterly
and annual reports for Lipper, Morningstar, and other third
party reporting agencies and survey companies) as mutually
agreed upon by Lincoln Life and Delaware
2
PHASE I (8/15/96 SCHEDULED CUTOVER DATE CONTINUED):
- Commencing 1/1/97, provide financial information for use in SEC
reporting (ie. NSAR, Prospectus, SAI, 24F2s, etc. . .)
- Provide financial information to support schedule "D"
OTHER SERVICES:
- Calculate monthly SEC yields & fund level performance
- Prepare information for tax returns and ancillary schedules and
submit to Lincoln Corporate Tax Department:
- 1120 RIC and any other required forms
- Year-end excise tax distributions
- Calculate and provide information for Subchapter M &
Section 4982 of Internal Revenue Code compliance
- Provide tax return workpapers to Lincoln Life for review purposes
- Perform the following special tax reporting functions
- Prepare income by state, exempt income and qualified
distributions
- Prepare financial information for expense & budget functions
- Maintain detailed records pertaining to expense accruals and
payments
- Adjust fund records to reflect accrual adjustments
- Prepare reports which are mutually agreed upon by Lincoln Life and
Delaware for Board of Director meetings & Senior Management
(as they pertain to these 6 Funds)
- Cooperate with custodians in all custody relationships
- Facilitate security settlements
- Perform required foreign security accounting functions
- Perform daily cash reconciliations for each Fund provided that the
bank(s) &/or third party mutual fund complex(s) send the
necessary information to perform such reconciliations
- Perform weekly asset reconciliations for each fund providing the
bank(s) &/or third party mutual fund complex(s) send the
necessary information to perform such reconciliations
- Support business relationships with Lincoln business partners (ie.
advisors, custodians, banks, third party administrators,
etc.)
- Provide portfolio holdings and security valuation reports
- Prepare cash forecasts and reconciliations as mutually
agreed upon by Lincoln Life and Delaware
- Assist in security settlements
- Resolve cash discrepancies
- Other reasonable requests as mutually agreed upon by Lincoln
Life and Delaware
- Disseminate reconciliation data to interested parties for daily
balancing needs as mutually agreed upon by Lincoln Life and
3
Delaware
- Provide process control data as mutually agreed upon by Lincoln
Life and Delaware
4
PHASE I (8/15/96 SCHEDULED CUTOVER DATE CONTINUED):
COMPLIANCE TESTING SERVICES:
- Perform the following Registered Investment Company tests as
required to maintain the tax qualified status of the Funds
and provide schedules of the results. These tests are to be
performed regularly as mutually agreed upon by Lincoln Life
and Delaware:
- Monthly 30% Gross Income Test (according to IRS regulations)
- Annual 90% Gross Income Test (according to IRS regulations)
- Monthly, prepare the IRS Industry Diversification Test (50%
& 25%)
- Annual 90% Distribution Test
- Provide monthly notification of derivative securities held in each
portfolio based upon a definition of "derivative" which is
mutually agreed upon by Lincoln Life and Delaware
THE FOLLOWING SERVICES WILL BEGIN AT THE CUTOVER DATE FOR PHASE I AND WILL
SUBSEQUENTLY BE PROVIDED BY DELAWARE FOR THE DURATION OF THE SERVICES AGREEMENT,
THE SEPARATE ACCOUNT SUB-ACCOUNTS FOR WHICH THESE SERVICES WILL BE PROVIDED ARE
AS FOLLOWS:
- Separate Account C LN Growth & Income Fund
- Separate Account C XX Xxxx Fund
- Separate Account C LN Social Awareness Fund
- Separate Account C LN Special Opportunities Fund
- Separate Account C LN Managed Fund
- Separate Account C LN Money Market Fund
- Separate Account C LN Global Asset Allocation Fund
- Separate Account C LN International Fund
- Separate Account C LN Aggressive Growth Fund
- Separate Account C LN Capital Appreciation Fund
- Separate Account C LN Equity Income Fund
- Separate Account C LN Delaware Equity Income Fund
- Separate Account C LN Delaware Emerging Growth Fund
- Separate Account C LN Delaware Global Bond Fund
- Separate Account K LN Growth & Income Fund
- Separate Account K XX Xxxx Fund
- Separate Account K LN Social Awareness Fund
- Separate Account K LN Special Opportunities Fund
- Separate Account K LN Managed Fund
5
- Separate Account K LN Money Market Fund
- Separate Account K LN Global Asset Allocation Fund
- Separate Account K LN International Fund
- Separate Account K LN Aggressive Growth Fund
- Separate Account K LN Capital Appreciation Fund
- Separate Account K LN Equity Income Fund
- Separate Account K LN Delaware Equity Income Fund
- Separate Account K LN Delaware Emerging Growth Fund
- Separate Account K LN Delaware Global Bond Fund
6
PHASE I (8/15/96 SCHEDULED CUTOVER DATE CONTINUED):
- Separate Account D LN Growth & Income Fund
- Separate Account D XX Xxxx Fund
- Separate Account D LN Special Opportunities Fund
- Separate Account D LN Managed Fund
- Separate Account D LN Money Market Fund
-
- Separate Account G LN Growth & Income Fund
- Separate Account G LN Special Opportunities Fund
- Separate Account 60 Global Bond Fund Net 1 UV
- Separate Account 60 Global Bond Fund Net 2 UV
- Separate Account 60 Global Bond Fund Net 3 UV
- Separate Account 60 Global Bond Fund Gross 1 UV
- Separate Account 60 Global Bond Fund Gross 2 UV
- Separate Account 61 Decatur Total Return Fund Net 1 UV
- Separate Account 61 Decatur Total Return Fund Net 2 UV
- Separate Account 61 Decatur Total Return Fund Net 3 UV
- Separate Account 61 Decatur Total Return Fund Gross 1 UV
- Separate Account 61 Decatur Total Return Fund Gross 2 UV
DAILY UNIT VALUE CALCULATIONS:
- Maintain Portfolio History
- Accrue dividends and expenses to each Sub-Account
- Maintain gain/loss history for each Sub-Account
- Maintain record of holdings for each Sub-Account
- Record and reconcile shareholder activity
- Book subscription, liquidations and dividend reinvestments
to each Sub-Account
- Record settlements of shareholder activity
- Reconcile Sub-Account units outstanding to Lincoln Life
administrative systems
- Establish controls for daily pricing of units outstanding of
each Sub-Account
- Calculate the Unit Value for each Lincoln Life Separate Account
Sub-Account.
- Disseminate daily Unit Values to interested parties (ie. Lipper,
Morningstar, etc. . .) as mutually agreed upon by Lincoln
Life and Delaware
- Resolve daily pricing and/or custody discrepancies
7
- Accept NAVs from State Street Bank for purposes of calculating unit
values of pertinent Separate Account Sub-Accounts
FINANCIAL REPORTING:
- Provide Lincoln Life with an automated transmission of Separate
Account Sub-Account financial data into the Lincoln Life
General Ledger.
- Provide other ancillary schedules as mutually agreed upon by
Lincoln Life and Delaware
8
PHASE I (8/15/96 SCHEDULED CUTOVER DATE CONTINUED):
OTHER SERVICES:
- Support business relationships with Lincoln business partners (ie.
advisors, custodians, banks, Third Party Administrators,
etc. . .)
- Provide portfolio holdings and security valuation reports
- Prepare cash forecasts and reconciliations as mutually
agreed upon by Lincoln Life and Delaware
- Assist in security settlements
- Resolve cash discrepancies
- Other reasonable requests as mutually agreed upon by Lincoln
Life and Delaware
- Provide financial information to support schedule "D"
- Disseminate reconciliation data to interested parties for daily
balancing needs as mutually agreed upon by Lincoln Life and
Delaware
- Provide process control data as mutually agreed upon by Lincoln
Life and Delaware
- Perform daily cash reconciliations for each Separate Account
(provided that the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations)
- Perform weekly asset reconciliations for each Separate Account
provided that the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations
PHASE II (10/31/96 SCHEDULED CUTOVER DATE):
THE FOLLOWING SERVICES WILL BEGIN IN THIS CUTOVER DATE FOR PHASE II AND WILL
SUBSEQUENTLY BE PROVIDED BY DELAWARE FOR THE DURATION OF THE SERVICES AGREEMENT.
THE SEPARATE ACCOUNTS FOR WHICH THESE SERVICES WILL BE PROVIDED ARE A, 3, 11,
12, 14, 17, 20, 21, 22, 23, 24, 25, 26, 27, 28, 30, 32:
DAILY UNIT VALUE CALCULATION SERVICES:
- Maintain Portfolio History
- Record portfolio purchases and sales
- Record corporate actions and capital changes
- Accrue interest, dividends and expenses
- Maintain income history for securities
- Record and reconcile shareholder activity
- Book subscription, liquidations and dividend reinvestments
9
- Record settlements of shareholder activity
- Reconcile fund shares outstanding to transfer agent
- Value portfolios (Calculate the Unit Value for each Separate
Account portfolio)
- Verify Delaware's internal controls - pricing securities and
portfolios
10
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
- Disseminate Unit Values to interested parties (Lincoln Life,
etc. . .) as mutually agreed upon by Lincoln Life and
Delaware
- Resolve daily pricing &/or custody discrepancies
FINANCIAL REPORTING SERVICES:
- Coordinate audit activities with external auditors
- Prepare statistical reports as mutually agreed upon by Lincoln Life
and Delaware
- Provide Lincoln with additional financial data as mutually agreed
upon by Lincoln Life and Delaware
- Provide Lincoln Life with an automated general ledger feed of
pertinent financial information (ie. revenue, cash flow,
etc. . . )
OTHER SERVICES:
- Cooperate with custodians in all custody relationships
- Facilitate security settlements
- Perform required foreign security accounting functions
- Perform daily cash reconciliations for each Separate Account
provided that the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations
- Perform weekly cash reconciliations for each Separate Account
provided that the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations
- Support business relationships with Lincoln business partners (ie.
advisors, custodians, banks, third party administrators,
etc. . .)
- Provide portfolio holdings and security valuation reports
- Prepare cash forecasts and reconciliations as mutually
agreed upon by Lincoln Life and Delaware
- Assist in security settlements
- Resolve cash discrepancies
- Other reasonable requests as mutually agreed upon by Lincoln
Life and Delaware
- Provide financial information to support schedule "D"
- Disseminate reconciliation data to interested parties for daily
balancing needs as mutually agreed upon by Lincoln Life and
Delaware
- Provide process control data as mutually agreed upon by Lincoln
11
Life and Delaware
COMPLIANCE TESTING SERVICES:
- Provide monthly notification of derivative securities held in each
portfolio based upon a definition of "derivative" which is
mutually agreed upon by Lincoln Life and Delaware
12
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
THE FOLLOWING SERVICES WILL BEGIN AT THE CUTOVER DATE FOR PHASE II AND WILL
SUBSEQUENTLY BE PROVIDED BY DELAWARE FOR THE DURATION OF THE SERVICES AGREEMENT.
THE SEPARATE ACCOUNT SUB-ACCOUNTS FOR WHICH THESE SERVICES WILL BE PROVIDED ARE
AS FOLLOWS:
- Separate Account A Traditional Annuities Gross 1 UV
- Separate Account A Traditional Annuities Terminal Funding UV
- Separate Account 3 Core Equity Fund Gross 1 UV
- Separate Account 11 Core Equity Account Net 1 UV
- Separate Account 11 Core Equity Account Net 2 UV
- Separate Account 11 Core Equity Account Net 3 UV
- Separate Account 11 Core Equity Account Gross 1 UV
- Separate Account 11 Core Equity Account Gross 2 UV
- Separate Account 11 Core Equity Account Balanced UV
- Separate Account 12 Govt. Corp Bond Account Net 1 UV
- Separate Account 12 Govt. Corp Bond Account Net 2 UV
- Separate Account 12 Govt. Corp Bond Account Net 3 UV
- Separate Account 12 Govt. Corp Bond Account Gross 1 UV
- Separate Account 12 Govt. Corp Bond Account Gross 2 UV
- Separate Account 12 Govt. Corp Bond Account Balanced UV
- Separate Account 14 Short Term Account Net 1 UV
- Separate Account 14 Short Term Account Net 2 UV
- Separate Account 14 Short Term Account Net 3 UV
- Separate Account 14 Short Term Account Gross 1 UV
- Separate Account 14 Short Term Account Gross 2 UV
- Separate Account 14 Short Term Account Balanced UV
- Separate Account 17 Medium Cap. Equity Account Net 1 UV
- Separate Account 17 Medium Cap. Equity Account Net 2 UV
- Separate Account 17 Medium Cap. Equity Account Net 3 UV
- Separate Account 17 Medium Cap. Equity Account Gross 1 UV
- Separate Account 17 Medium Cap. Equity Account Gross 2 UV
- Separate Account 17 Medium Cap. Equity Account Balanced UV
- Separate Account 20 High Yield Bond Account Net 1 UV
- Separate Account 20 High Yield Bond Account Net 2 UV
- Separate Account 20 High Yield Bond Account Net 3 UV
- Separate Account 20 High Yield Bond Account Gross 1 UV
- Separate Account 20 High Yield Bond Account Gross 2 UV
- Separate Account 20 High Yield Bond Account Balanced UV
- Separate Account 21 Balanced Account Net 1 UV
13
- Separate Account 21 Balanced Account Net 2 UV
- Separate Account 21 Balanced Account Net 3 UV
- Separate Account 21 Balanced Account Gross 1 UV
- Separate Account 21 Balanced Account Gross 2 UV
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
- Separate Account 22 International Account Net 1 UV
- Separate Account 22 International Account Net 2 UV
- Separate Account 22 International Account Net 3 UV
- Separate Account 22 International Account Gross 1 UV
- Separate Account 22 International Account Gross 2 UV
- Separate Account 22 International Account Balanced UV
- Separate Account 23 Large Cap. Equity Account Net 1 UV
- Separate Account 23 Large Cap. Equity Account Net 2 UV
- Separate Account 23 Large Cap. Equity Account Net 3 UV
- Separate Account 23 Large Cap. Equity Account Gross 1 UV
- Separate Account 23 Large Cap. Equity Account Gross 2 UV
- Separate Account 23 Large Cap. Equity Account Balanced UV
- Separate Account 24 Small Cap. Equity Account Net 1 UV
- Separate Account 24 Small Cap. Equity Account Net 2 UV
- Separate Account 24 Small Cap. Equity Account Net 3 UV
- Separate Account 24 Small Cap. Equity Account Gross 1 UV
- Separate Account 24 Small Cap. Equity Account Gross 2 UV
- Separate Account 24 Small Cap. Equity Account Balanced UV
- Separate Account 25 Long Term Bond Gross 1G UV
- Separate Account 26 Govt. Bond Account Net 1 UV
- Separate Account 26 Govt. Bond Account Net 2 UV
- Separate Account 26 Govt. Bond Account Net 3 UV
- Separate Account 26 Govt. Bond Account Gross 1 UV
- Separate Account 26 Govt. Bond Account Gross 2 UV
- Separate Account 27 Stable Value Account Net 2 UV
- Separate Account 27 Stable Value Account Net 3 UV
- Separate Account 27 Stable Value Account Gross 2 UV
- Separate Account 28 Value Equity Account Net 1 UV
- Separate Account 28 Value Equity Account Net 2 UV
- Separate Account 28 Value Equity Account Net 3 UV
- Separate Account 28 Value Equity Account Gross 1 UV
- Separate Account 28 Value Equity Account Gross 2 UV
- Separate Account 28 Value Equity Account Balanced UV
- Separate Account 30 Conservative Balanced Account Net 1 UV
- Separate Account 30 Conservative Balanced Account Net 2 UV
- Separate Account 30 Conservative Balanced Account Net 3 UV
14
- Separate Account 30 Conservative Balanced Account Gross 1 UV
- Separate Account 30 Conservative Balanced Account Gross 2 UV
- Separate Account 32 Aggressive Balanced Account Net 1 UV
- Separate Account 32 Aggressive Balanced Account Net 2 UV
- Separate Account 32 Aggressive Balanced Account Net 3 UV
- Separate Account 32 Aggressive Balanced Account Gross 1 UV
- Separate Account 32 Aggressive Balanced Account Gross 2 UV
15
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
- Separate Account 41 Fidelity Asset Manager Net 2 UV
- Separate Account 41 Fidelity Asset Manager Net 3 UV
- Separate Account 41 Fidelity Asset Manager Gross 2 UV
- Separate Account 42 Janus Capital Appreciation Net 2 UV
- Separate Account 42 Janus Capital Appreciation Net 3 UV
- Separate Account 42 Janus Capital Appreciation Gross 2 UV
- Separate Account 43 Fidelity Contra Net 2 UV
- Separate Account 43 Fidelity Contra Net 3 UV
- Separate Account 43 Fidelity Contra Gross 2 UV
- Separate Account 44 Strong Discovery Net 2 UV
- Separate Account 44 Strong Discovery Net 3 UV
- Separate Account 44 Strong Discovery Gross 2 UV
- Separate Account 45 T-Xxxx Price International Net 2 UV
- Separate Account 45 T-Xxxx Price International Net 3 UV
- Separate Account 45 T-Xxxx Price International Gross 2 UV
- Separate Account F XXXX Xxxx Management Fund
- Separate Account F AVIS Growth Series Fund
- Separate Account F AVIS Growth Income Fund
- Separate Account F AVIS High Yield Bond Fund
- Separate Account F AVIS Govt. AAA Securities Fund
- Separate Account F AVIS International Fund
- Separate Account F AVIS Asset Allocation Fund
- Separate Account F XXXX Xxxx Fund
- Separate Account J XXXX Xxxx Management Fund
- Separate Account J AVIS Growth Series Fund
- Separate Account J AVIS Growth Income Fund
- Separate Account J AVIS High Yield Bond Fund
- Separate Account J AVIS Govt. AAA Securities Fund
- Separate Account J AVIS International Fund
- Separate Account J AVIS Asset Allocation Fund
- Separate Account J XXXX Xxxx Fund
- Separate Account G XXXX Xxxx Management Fund
- Separate Account G AVIS Growth Series Fund
- Separate Account G AVIS Growth Income Fund
- Separate Account G AVIS High Yield Bond Fund
- Separate Account G AVIS Govt. AAA Securities Fund
- Separate Account G AVIS International Fund
- Separate Account G AVIS Asset Allocation Fund
- Separate Account G XXXX Xxxx Fund
16
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
- Separate Account E XXXX Xxxx Management Fund
- Separate Account E AVIS Growth Series Fund
- Separate Account E AVIS Growth Income Fund
- Separate Account E AVIS High Yield Bond Fund
- Separate Account E AVIS Govt. AAA Securities Fund
- Separate Account E AVIS International Fund
- Separate Account E AVIS Asset Allocation Fund
- Separate Account E XXXX Xxxx Fund
- Separate Account H XXXX Xxxx Management Fund
- Separate Account H AVIS Growth Series Fund
- Separate Account H AVIS Growth Income Fund
- Separate Account H AVIS High Yield Bond Fund
- Separate Account H AVIS Govt. AAA Securities Fund
- Separate Account H AVIS International Fund
- Separate Account H AVIS Asset Allocation Fund
- Separate Account H XXXX Xxxx Fund
- Separate Account 50 XXXX Xxxx Management Fund
- Separate Account 50 AVIS Growth Series Fund
- Separate Account 50 AVIS Growth Income Fund
- Separate Account 50 AVIS High Yield Bond Fund
- Separate Account 50 AVIS Govt. AAA Securities Fund
- Separate Account 50 AVIS International Fund
- Separate Account 50 AVIS Asset Allocation Fund
- Separate Account 50 XXXX Xxxx Fund
- Separate Account 51 XXXX Xxxx Management Fund
- Separate Account 51 AVIS Growth Series Fund
- Separate Account 51 AVIS Growth Income Fund
- Separate Account 51 AVIS High Yield Bond Fund
- Separate Account 51 AVIS Govt. AAA Securities Fund
- Separate Account 51 AVIS International Fund
- Separate Account 51 AVIS Asset Allocation Fund
- Separate Account 51 XXXX Xxxx Fund
- Separate Account 52 XXXX Xxxx Management Fund
- Separate Account 52 AVIS Growth Series Fund
- Separate Account 52 AVIS Growth Income Fund
- Separate Account 52 AVIS High Yield Bond Fund
- Separate Account 52 AVIS Govt. AAA Securities Fund
- Separate Account 52 AVIS International Fund
- Separate Account 52 AVIS Asset Allocation Fund
- Separate Account 52 XXXX Xxxx Fund
DAILY UNIT VALUE CALCULATIONS:
17
- Maintain Portfolio History
- Accrue dividends and expenses to each Sub-Account
- Maintain gain/loss history for each Sub-Account
- Maintain record of holdings for each Sub-Account
PHASE II (10/31/96 SCHEDULED CUTOVER DATE CONTINUED):
- Record and reconcile shareholder activity
- Book subscription, liquidations and dividend reinvestments
to each Sub-Account
- Record settlements of shareholder activity
- Reconcile Sub-Account units outstanding to Lincoln Life
administrative systems
- Establish controls for daily pricing of units outstanding
of each Sub-Account
- Calculate the Unit Value for each Lincoln National
Separate Account Sub-Account.
- Disseminate daily Unit Values to interested parties
(ie. Lipper, Morningstar, etc. . .) as mutually agreed upon
by Lincoln Life and Delaware
- Resolve daily pricing and/or custody discrepancies
- Accept NAVs from applicable managers, advisors and
subadvisors for purposes of calculating Unit Values of
pertinent Separate Account Sub-Accounts
FINANCIAL REPORTING:
- Provide Lincoln with an automated transmission of
Separate Account Sub-Account financial data into the Lincoln
Life General Ledger.
- Provide other ancillary schedules as mutually agreed
upon by Lincoln Life and Delaware
OTHER SERVICES:
- Support business relationships with Lincoln business
partners (ie. advisors, custodians, banks, third party
administrators, etc. . .)
- Provide portfolio holdings and security valuation reports
- Prepare cash forecasts and reconciliations as mutually
agreed upon by Lincoln Life and Delaware
- Assist in security settlements
- Resolve cash discrepancies
- Other reasonable requests as mutually agreed upon by Lincoln
Life and Delaware
- Provide financial information to support schedule "D"
- Disseminate reconciliation data to interested parties
for daily balancing needs as mutually agreed upon by Lincoln
Life and Delaware
- Provide process control data as a mutually agreed
upon by Lincoln Life and Delaware
- Perform daily cash reconciliations for each Separate
Account provided that the bank(s) &/or third party mutual
18
fund complex(s) send the necessary information to perform
such reconciliations
- Perform weekly asset reconciliations for each
Separate Account provided that the bank(s) &/or mutual
fund complex(s) send the necessary information to perform
such reconciliations
19
PHASE III (1/1/97 SCHEDULED CUTOVER DATE):
THE FOLLOWING SERVICES WILL BEGIN AT THIS CUTOVER DATE FOR
PHASE III AND WILL SUBSEQUENTLY BE PROVIDED BY DELAWARE FOR THE
DURATION OF THE SERVICES AGREEMENT. THE FUNDS FOR WHICH THESE
SERVICES WILL BE PROVIDED ARE AS FOLLOWS:
- Lincoln National Global Asset Allocation Fund Inc.,
- Lincoln National International Fund Inc.,
- Lincoln National Capital Appreciation Fund Inc.,
- Lincoln National Equity Income Fund Inc.,
- Lincoln National Aggressive Growth Fund Inc.
DAILY NET ASSET VALUE CALCULATION SERVICES:
- Maintain Portfolio History
- Record portfolio purchases and sales
- Record corporate actions and capital changes
- Accrue interest, dividends and expenses
- Maintain income history for securities
- Determine distributions to shareholders
- Record and reconcile shareholder activity
- Book subscription, liquidations and dividend reinvestments
- Record settlements of shareholder activity
- Reconcile fund shares outstanding to transfer agent
- Value portfolios (Calculate the NAV for each Fund
portfolio)
- Verify Delaware's internal controls - pricing securities and
portfolios
- Disseminate NAVs and dividends to interested parties
(Lincoln Life, ICI, Morningstar, Lipper, etc.) as mutually
agreed upon by Lincoln Life & Delaware
- Resolve daily pricing &/or custody discrepancies
FINANCIAL REPORTING SERVICES:
- Commencing 6/30/97, prepare the following information
for use in the semi-annual and annual reports for
shareholders:
- Prepare Statement of Net Assets, Statement of Operations
and Changes in Net Assets
- Work with external auditors on footnotes to the financial
statements,
- Workpapers for annual audit,
- Cooperate with external auditors, Lincoln Life Marketing &
printer
- Required ICI reporting as mutually agreed upon by
Lincoln Life and Delaware
- Prepare Statistical reports as necessary (daily,
monthly, quarterly and annual reports for Lipper,
Morningstar, and other third party reporting agencies and
20
survey companies) as mutually agreed upon by Lincoln Life
and Delaware
- Commencing 1/1/97, provide financial information for
use in SEC reporting (ie. NSAR, Prospectus, SAI, 24F2s,
etc. . .)
- Provide financial information to support schedule "D"
21
PHASE III (1/1/97 SCHEDULED CUTOVER DATE CONTINUED):
OTHER SERVICES:
- Calculate monthly SEC yields & fund level performance
- Prepare information for tax returns and ancillary
schedules and submit to Corporate Tax Department:
- 1120 RIC and any other required forms
- Year-end excise tax distributions
- Calculate and provide information for Subchapter M &
Section 4982 of Internal Revenue Code compliance
- Provide tax return workpapers to Lincoln Life for
review purposes
- Perform the following special tax reporting functions
- Prepare income by state, exempt income and qualified
distributions
- Prepare financial information for expense & budget
functions
- Maintain detailed records pertaining to expense accruals and
payments
- Adjust fund records to reflect accrual adjustment
- Prepare reports which are mutually agreed upon by
Lincoln Life and Delaware for Board of Director meetings &
Senior Management (as they pertain to these 5 Funds)
- Cooperate with custodians in all custody
relationships
- Facilitate security settlements
- Perform required foreign security accounting
functions
- Perform daily cash reconciliations for each Fund
provided that the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations
- Perform weekly asset reconciliations for each fund
providing the bank(s) &/or third party mutual fund
complex(s) send the necessary information to perform such
reconciliations
- Support business relationships with Lincoln business
partners (ie. advisors, custodians, banks, third part
administrators, etc. .)
- Provide portfolio holdings and security valuation reports
- Prepare cash forecasts and reconciliations as mutually
agreed upon by Lincoln Life and Delaware
- Assist in security settlements
- Resolve cash discrepancies
- Other reasonable requests as mutually agreed upon by Lincoln
Life and Delaware
- Disseminate reconciliation data to interested parties
for daily balancing needs as mutually agreed upon by Lincoln
Life and Delaware
- Provide process control data as mutually agreed upon
by Lincoln Life and Delaware
22
PHASE III (1/1/97 SCHEDULED CUTOVER DATE CONTINUED):
COMPLIANCE TESTING SERVICES:
- Perform the following Registered Investment Company
tests as required to maintain the tax qualified status of
the funds and provide schedules of the results. These test
will be performed regularly as mutually agreed upon by
Lincoln Life and Delaware.
- Monthly 30% Gross Income Test (according to IRS regulations)
- Annual 90% Gross Income Test (according to IRS regulations)
- Monthly, prepare the IRS Industry Diversification Test
(50% & 25%)
- Annual 90% Distribution Test
- Provide monthly notification of derivative securities
held in each portfolio based upon a definition of
"derivative" which is mutually agreed upon by Lincoln Life
and Delaware
NOTE: DELAWARE WILL NOT PROVIDE LEGAL ASSISTANCE, COMPLIANCE
MONITORING OR TAX WORK OTHER THAN WHAT IS SPECIFIED ABOVE.
DELAWARE WILL NOT SIGN THE TAX RETURNS.
23
SCHEDULE 2.1
PROCEDURES FOR CORRECTING ERRORS
The following charts set forth certain procedures to be followed in the
event of errors in the calculation of the Net Asset Values and Unit Values.
There are two separate charts: Chart I outlines the procedures to be followed in
the event that the error is greater than, or equal to, .5% of the Fund's Net
Asset Value or Separate Account's Unit Value; Chart II outlines the procedure in
the event that the error is less than .5%. Each of the Charts assumes that the
error in the Unit Value or Net Asset Value is at least $.01. If the error is
less than $.01, no action will be taken.
The procedures set forth in these Charts are designed to be consistent
with informal positions taken by the Securities and Exchange Commission (the
"SEC") with respect to errors in the calculation of net asset values or unit
values. The parties to the Services Agreement shall negotiate in good faith to
amend this Schedule 2.1 as appropriate in the event that (a) the SEC modifies,
amends or supplements such positions, or issues any other regulatory guidance
with respect to net asset values, unit values, or both, or (b) a Unit Value
changes to a degree that alternative error correction procedures should be
considered.
CHART I
ERROR GREATER THAN OR EQUAL TO .5%
--------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------
Net Asset Value Net Asset Value
or or
Type of Transaction Unit Value Understated Unit Value Overstated
--------------------------------------------------------------------------------------------------------------------------
Make Fund or Separate
Subscription Account Whole (1) Reprocess (2)
--------------------------------------------------------------------------------------------------------------------------
Make Fund or Separate
Redemption Reprocess (3) Account Whole (1)
--------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------
---------------------------
(1) Alternatively, at Lincoln Life's or the relevant Fund's discretion, all
shareholder transactions can be reprocessed. At the Fund level, the
shareholder would be the Lincoln Life Separate Account. At the Separate
Account level, the shareholder would be the Contractowner.
(2) Reprocessing would occur for all transactions where the shareholder
effect is greater than $10.00.
(3) Reprocessing would occur for all transactions where the shareholder
effect is greater than $10.00. Lincoln Life or the relevant Fund, at its
respective discretion, would reimburse the shareholder.
24
CHART II
ERROR LESS THAN .5%
--------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------
Net Asset Value Net Asset Value
or or
Type of Transaction Unit Value Understated Unit Value Overstated
--------------------------------------------------------------------------------------------------------------------------
Make Fund or Separate
Subscription Account Whole (1) No Action (2)
--------------------------------------------------------------------------------------------------------------------------
Make Fund or Separate
Redemption No Action (3) Account Whole (1)
--------------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------
---------------------------
(1) Alternatively, at Lincoln Life's or the relevant Fund's discretion, the
shareholder transactions can be reprocessed. At the Fund level, the
shareholder would be the Lincoln Life Separate Account. At the Separate
Account level, the shareholder would be the Contractowner.
(2) Alternatively, Lincoln Life or the relevant Fund could determine to
reprocess the transactions.
(3) Alternatively, Lincoln Life or the relevant Fund could determine to
reprocess transactions and reimburse the shareholders.
- 26 -
SCHEDULE 3.1
DATA PROVIDED BY LINCOLN LIFE
- 27 -
DATA PROVIDED BY LINCOLN LIFE
THE FOLLOWING INFORMATION REPRESENTS DATA WHICH WILL BE PROVIDED BY LINCOLN LIFE
TO DELAWARE FOR THE PURPOSE OF ENABLEING DELAWARE TO PERFORM THE ACCOUNTING
SERVICES PURSUANT TO THE SERIVCES AGREEMENT.
1) BY 9:00 AM NEW YORK TIME EACH BUSINESS DAY, LINCOLN LIFE WILL PROVIDE
DELAWARE WITH TRADE ACTIVITY (BY SUB-ACCOUNT - E.G. SEPARATE
ACCOUNT C GROWTH FUND TRADES) FOR THE PURPOSE OF ADDING THIS
INFORMATION TO THE OUTSTANDING ASSETS OF EACH SUB-ACCOUNT.
THIS DAILY TRADE ACTIVITY WILL INCLUDE A NET PURCHASE OR REDEMPTION
AMOUNT BY SUB-ACCOUNT, THE NET NUMBER OF UNITS PURCHASED BY
SUB-ACCOUNT BY LINCOLN LIFE CLIENTS THE PRECEDING BUSINESS DAY OR
DAYS AND FUND SHARE PURCHASES AND SALES IN DOLLARS AND SHARE
AMOUNTS.
2. BY 9:00 AM NEW YORK TIME EACH BUSINESS DAY, LINCOLN LIFE WILL PROVIDE
DELAWARE WITH THE NUMBER OF OUTSTANDING UNITS WITHIN EACH
SUB-ACCOUNT FOR PURPOSES OF BALANCING TO THE NUMBER OF UNITS USED
IN THE DAILY UNIT VALUE CALCULATION AND THE NUMBER OF OUTSTANDING
SHARES WITHIN EACH FUND.
NOTE: IN THE EVENT THAT LINCOLN LIFE IDENTIFIES ERRONEOUS DATA IN THEIR DAILY
TRANSMISSION OF TRADE ACTIVITY WHILE PERFORMING THEIR BALANCING ROUTINE
SUBSEQUENT TO THE TRANSMISSION, LINCOLN LIFE WILL INFORM DELAWARE OF
THE ERRONEOUS INFORMATION VIA TELEPHONE.
- 28 -
SCHEDULE 3.2
UNAFFILIATED MUTUAL FUNDS
AND
SERVICE PROVIDERS
- 29 -
DATA PROVIDED BY UNAFFILIATED MUTUAL FUNDS AND SERVICE PROVIDERS
The following information represents data which will be provided by third
parties to Delaware pursuant to section 3.2 of the Services Agreement.
1) Each evening of a business day, all applicable Fund managers, advisors
and subadvisors will provide to Delaware (via fax), the daily net
asset values of such funds no later than 6:00 pm New York Time.
(See note below)
2) Each evening of a business day, Delaware will obtain the daily New Asset
Values of such of its own funds as are underlying investments in
Lincoln Life's Separate Accounts in a timely fashion to meet
Lincoln Life's delivery timeliness specified in this Services
Agreement.
3) Delaware will accept data from and work with Lincoln Life business
partners in relationship accepted in the industry as a normal
working relationship. These types of relationships would include
cooperating with custodians, portfolio managers, etc. for the
purpose of conducting daily business transactions.
Note: In the event that Delaware does not receive timely NAVs or trade
information from Fund managers, advisors or subadvisors which causes
Delaware to be incapable of calculating a Unit Value using mutually
agreed upon processing procedures, or causes Delaware to estimate a
Unit Value, then Delaware and Lincoln Life must mutually agree upon the
processing activities to take place on that particular valuation date.
- 30 -
SCHEDULE 6.1
FEE SCHEDULE
- 31 -
SERVICES FEE SCHEDULE
THE FOLLOWING SCHEDULE OUTLINES THE FEES CHARGED TO THE VARIOUS FUNDS AND
SEPARATE ACCOUNTS FOR SERVICES RENDERED BY DELAWARE PURSUANT TO THE SERVICES
AGREEMENT AND THE ACCOMPANYING CUTOVER SCHEDULE. FOLLOWING THE FEE SCHEDULE AT
THE TOP OF EACH OF THE FOLLOWING PAGES THERE WILL BE AN ILLUSTRATION OF HOW THE
FEES ARE TO BE APPLIED TO EACH OF THE FUNDS AND SEPARATE ACCOUNTS. THE ACCOUNT
ASSET BASE TO WHICH THE FEES ARE APPLIED WILL CHANGE FROM DAY TO DAY, THUS THE
ASSET FEES WILL BE CALCULATED USING DAILY AVERAGE NET ASSETS AND PRORATED
MONTHLY (THE FOREGOING DOES NOT APPLY, HOWEVER, TO "FUND OF FUNDS" FEES, WHICH
ARE NOT ASSET-BASED).
- 32 -
LINCOLN LIFE MULTI-FUNDS MUTUAL FUNDS
Mutual Fund FIRST CLASS OF EACH ADD 100MM TO > 500MM & > 750 MM & > 1 BILLION
Schedule SHARE MINIMUM SH CLASS 500 MM < 750MM < 1 BILLION
(EF) EQUITY FUND 65,000.00 2,200.00 0.0375% 0.035% 0.030% 0.020%
(FX) FIXED INCOME FUND 65,000.00 2,200.00 0.0375% 0.035% 0.030% 0.020%
(IF) INTERNATIONAL FUND 87,000.00 2,200.00 0.0600% 0.060% 0.060% 0.050%
(MM) MONEY MARKET FUND 65,000.00 2,200.00 0.0375% 0.035% 0.030% 0.020%
Fund Asset Based Per Class Total Basis Point
Assets Fee Fee Fee Effect
(EQ) - Aggressive Growth $154,616,934 85,481 0 $85,481 0.0553%
(FX) Bond Fund $266,680,575 127,505 0 127,505 0.0478%
(EQ) - Capital Appreciation $151,716,031 84,394 0 84,394 0.0556%
(EQ) - Equity Income $281,782,031 133,168 0 133,168 0.0473%
(EQ) Growth Fund $2,021,137,764 581,728 0 581,728 0.0288%
(IF) - International Fund $374,321,155 251,593 0 251,593 0.0672%
(EQ) Managed Fund $627,188,004 259,516 0 259,516 0.0414%
(MM) Money Market $80,389,568 65,000 0 65,000 0.0809%
(IF) - Global Asset Allocation $265,441,845 186,265 0 186,265 0.0702%
(EQ) Social Awareness Fund $345,607,966 157,103 0 157,103 0.0455%
- 33 -
(EQ) Special Opportunities $542,260,936 229,791 0 229,791 0.0424%
Total Funds $5,111,142,809 $2,161,544 $0 $2,161,544 0.0423%
- 34 -
LINCOLN LIFE NUMBERED SEPARATE ACCOUNT SCHEDULE
Separate Account FIRST CLASS OF EACH ADD 100MM TO > 500MM & > 750 MM & > 1 BILLION
Schedule SHARE MINIMUM SH CLASS 500 MM < 750MM < 1 BILLION
(EF) EQUITY FUND 33,000.00 2,200.00 0.0175% 0.0150% 0.0125% 0.0100%
(FX) FIXED INCOME FUND 33,000.00 2,200.00 0.0175% 0.0150% 0.0125% 0.0100%
(IF) INTERNATIONAL FUND 33,000.00 2,200.00 0.0475% 0.0450% 0.0400% 0.0350%
(MM) MONEY MARKET FUND 33,000.00 2,200.00 0.0125% 0.0125% 0.0125% 0.0100%
(FOF) FUND OF FUNDS 6,750.00 0.00 0.0000% 0.0000% 0.0000% 0.0100%
Asset Class Total Average
Account Name Account Assets Fees Fees Fees BP Charge
(EF) S/A 3 $389,025 33,000 0 $33,000 8.4827%
(EF) S/A 11 $474,450,174 98,529 11,000 109,528 0.0231%
(FX) S/A 12 $416,068,954 88,312 11,000 99,312 0.0239%
(MM) S/A 14 $156,276,681 40,035 11,000 51,035 0.0327%
(EF) S/A 17 $364,026,813 79,205 11,000 90,205 0.0248%
(FX) S/A 20 $46,993,349 33,000 11,000 44,000 0.0936%
(IF) S/A 22 $173,298,316 91,649 11,000 102,649 0.0592%
(EF) S/A 23 $433,690,920 91,396 11,000 102,396 0.0236%
(EF) S/A 24 $113,151,449 35,302 11,000 46,302 0.0409%
(EF) S/A 25 $16,793,121 33,000 2,200 35,200 0.2096%
(FX) S/A/26 $29,937,204 33,000 11,000 44,000 0.1470%
(FX) S/A 27 $10,050,477 33,000 4,400 37,400 0.3721%
(EF) S/A 28 $55,899,985 33,000 11,000 44,000 0.0787%
(EF) V/A Fund A $107,782,578 34,362 2,200 36,562 0.0339%
Total Separate $2,398,810,045 $756,798 $118,800 $875,589 0.0365%
Account Fees
-------------
Fund of
Funds
-------------
- 35 -
-------------
# of Accts Per Account
Account Name Needed Charge Total
(FOF) S/A 21 5 $6,750 $33,750
(FOF) S/A 30 5 $6,750 $33,750
(FOF) S/A 32 5 $6,750 $33,750
(FOF) Fund of Funds S/A C 14 $6,750 $94,500
(FOF) Fund of Funds S/A D 5 $6,750 $33,750
(FOF) Fund of Funds S/A E 8 $6,750 $54,000
(FOF) Fund of Funds S/A F 8 $6,750 $54,000
(FOF) Fund of Funds S/A G 10 $6,750 $67,500
(FOF) Fund of Funds S/A H 8 $6,750 $54,000
(FOF) Fund of Funds S/A J 8 $6,750 $54,000
(FOF) Fund of Funds S/A K 14 $6,750 $94,500
(FOF) Fund of Funds S/A 41 3 $6,750 $20,250
(FOF) Fund of Funds S/A 42 3 $6,750 $20,250
(FOF) Fund of Funds S/A 43 3 $6,750 $20,250
(FOF) Fund of Funds S/A 44 3 $6,750 $20,250
(FOF) Fund of Funds S/A 45 3 $6,750 $20,250
(FOF) Fund of Funds S/A 60 8 $6,750 $54,000
(FOF) Fund of Funds S/A 61 8 $6,750 $54,000
(FOF) Fund of Funds S/A 62 8 $6,750 $54,000
(FOF) Fund of Funds S/A 60 6 $6,750 $40,500
(FOF) Fund of Funds S/A 61 6 $6,750 $40,500
141 $141,750 $951,750
- 36 -
S/As Fund of Funds Fee Schedule:
ACCOUNT REFERENCE:
Registered: X/Xx X, X, X, X, X, X, X-XX, X, K, L, L-NY, M, N, Q, R,
S, T, Unum, 1st Unum, CG VA I, CG VA II, Cigna VA I, CG VL I,
CG XX XX, Aetna Acct. B.
Non-Registered: S/As 21, 30, 32, 33, 34, 35, 36, 37, 38, 42, 45, 50,
51, 52, 53, 60, 61.
Delaware Services Corporation charges Lincoln National Life $2
million per year for up to 1800 unit value calculations.
NON-REGISTERED S/As (holding securities traded on the Exchange) Fee
Schedule:
S/As A, 3, 11, 12, 14, 17, 20, 22, 23, 24, 25, 26, 28.
Delaware Services Corporation charges Lincoln National Life $800,000
per year for accounting services associated with the aforementioned
S/As.
- 37 -
