FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is executed as of May 15th, 2009, and effective as of May
15th, 2009, by and among BLACKROCK VARIABLE SERIES FUNDS, INC. an open-end
management investment company organized as a Maryland corporation (the
"Fund"), BLACKROCK INVESTMENTS, LLC ("BRIL"), a broker-dealer registered as
such under the Securities Exchange Act of 1934, as amended (the
"Underwriter"), THE LINCOLN NATIONAL LIFE INSURANCE COMPANY AND LINCOLN LIFE
& ANNUITY COMPANY OF NEW YORK , life insurance companies organized under the
laws of the states of Indiana and New York ("Company"), on its own behalf and
on behalf of each separate account of the Company set forth on Schedule A, as
may be amended from time to time (the "Accounts") and Lincoln Financial
Distributors, Inc., an affiliate of the Company, the principal underwriter of
the Accounts and the Contracts, and a broker-dealer registered as such under
the Securities Exchange Act of 1934 (the "Distributor").
W I T N E S S E T H:
WHEREAS, the Fund has filed a registration statement with the Securities
and Exchange Commission ("SEC") to register itself as an open-end management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"), and to register the offer and sale of its shares under the
Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Fund desires to act as an investment vehicle for separate
accounts established for variable life insurance policies and variable
annuity contracts to be offered by insurance companies that have entered into
participation agreements with the Fund (the "Participating Insurance
Companies"); and
WHEREAS, the Underwriter is registered as a broker-dealer with the SEC
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), is a
member in good standing of the Financial Industry Regulatory Authority
("FINRA") and acts as principal underwriter of the shares of the Fund; and
WHEREAS, the capital stock of the Fund is divided into several series of
shares, each series representing an interest in a particular managed
portfolio of securities and other assets; and
WHEREAS, the several series of shares of the Fund offered by the Fund to
the Company and the Accounts are set forth on Schedule B attached hereto
(each, a "Portfolio," and, collectively, the "Portfolios"); and
WHEREAS, the Fund has received an order from the SEC granting
Participating Insurance Companies and their separate accounts exemptions from
the provisions of sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and
rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Fund to be sold to and held by variable annuity and
variable life insurance separate accounts of both affiliated and unaffiliated
life insurance companies (the "Shared Fund Exemptive Order"); and
WHEREAS, BlackRock Advisors, LLC ("BAL") is duly registered as an
investment adviser under the Investment Advisers Act of 1940, as amended, and
is the Funds' investment adviser; and
WHEREAS, the Company has registered or will register under the 1933 Act
certain variable life insurance policies and/or variable annuity contracts
funded or to be funded through one or more of the Accounts (the "Contracts");
and
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WHEREAS, the Company has registered or will register each Account as a
unit investment trust under the 1940 Act; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in one or more of the
Portfolios (the "Shares") on behalf of the Accounts to fund the Contracts,
and the Fund intends to sell such Shares to the relevant Accounts at such
Shares' net asset value.
NOW, THEREFORE, in consideration of their mutual promises, the parties
agree as follows:
ARTICLE 1
SALE OF THE FUND SHARES
1.1 Subject to Section 1.3, the Fund shall make shares of the
Portfolios available to the Accounts at the most recent net asset value
provided to the Company prior to receipt of such purchase order by the Fund
(or the Fund's transfer agent), in accordance with the operational procedures
mutually agreed to by the Fund and the Company from time to time and the
provisions of the then current prospectus of the Portfolios. Shares of a
particular Portfolio of the Fund shall be ordered in such quantities and at
such times as determined by the Company to be necessary to meet the
requirements of the Contracts. The Directors of the Fund (the "Directors")
may refuse to sell shares of any Portfolio to any person (including the
Company and the Accounts), or suspend or terminate the offering of shares of
any Portfolio, if such action is required by law or by regulatory authorities
having jurisdiction in their sole discretion when acting in good faith and in
light of their fiduciary duties under federal and any applicable state laws,
if they deem such actions necessary in the best interests of the shareholders
of such Portfolio.
1.2 If transactions in Fund shares are to be settled through the
NSCC Fund/SERV system, the following provisions shall apply:
a) FUND/SERV TRANSACTIONS. If the parties choose to use the National
Securities Clearing Corporation's Mutual Fund Settlement, Entry and
Registration Verification ("Fund/SERV") system, any corrections to a
Fund's prices for the prior trade date will be submitted through the
Mutual Fund Profile with the correct prices and applicable date. If
the corrections are dated later than trade date plus one, a facsimile
should be sent in addition to the Mutual Fund Profile submission; or
b) MANUAL TRANSACTIONS. If the parties choose not to use Fund/SERV, if
there are technical problems with Fund/SERV, or if the parties are not
able to transmit or receive information through Fund/SERV, any
corrections to a Fund's prices should be communicated by facsimile or
by electronic transmission, and will include for each day on which an
adjustment has occurred the incorrect Fund price, the correct price,
and, to the extent communicated to Fund shareholders, the reason for
the adjustment.
c) PURCHASES AND REDEMPTION ORDERS; SETTLEMENT OF TRANSACTIONS.
i. METHOD OF COMMUNICATION.
FUND/SERV TRANSACTIONS. If the parties choose to use Fund/SERV,
the following provisions shall apply:
The Company and the Fund or its designee will be bound by the rules
of the NSCC. Without limiting the generality of the following
provisions of this section, the
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Company and the Fund or its designee each will perform any and all
duties, functions, procedures and responsibilities assigned to it and
as otherwise established by the NSCC applicable to Fund/SERV and the
Networking Matrix Level utilized.
Any information transmitted through NSCC's Networking system by any
party to the other and pursuant to this amendment will be accurate,
complete, and in the format prescribed by the NSCC. Each party will
adopt, implement and maintain procedures reasonably designed to ensure
the accuracy of all transmissions through Networking and to limit the
access to, and the inputting of data into, Networking to persons
specifically authorized by such party.
On each Business Day, the Company shall aggregate and calculate the
net purchase and redemption orders for each Account received by the
Company prior to the Close of Trading on each Business Day. The
Company shall communicate to the NSCC the net aggregate purchase or
redemption orders (if any) for each Account received by the Close of
Trading on such Business Day (the "Trade Date") no later than 6:00
a.m. Eastern Time on the Business Day following the Trade Date. All
orders received by the Company after the Close of Trading on a
Business Day shall not be transmitted to NSCC prior to the following
Business Day. The Fund or its designee shall treat all trades
communicated to the Fund or its designee in accordance with this
provision as if received prior to the Close of Trading on the Trade
Date.
All orders are subject to acceptance by the Fund or its designee
and become effective only upon confirmation by the Fund or its
designee. Upon confirmation, the Fund or its designee will verify
total purchases and redemptions and the closing share position for
each Account. In the case of delayed settlement, the Fund or its
designee shall make arrangements for the settlement of redemptions by
wire no later than the time permitted for settlement of redemption
orders by the Investment Company Act of 1940, as amended (the "1940
Act").
ii. MANUAL TRANSACTIONS. If the parties choose not to use Fund/SERV,
if there are technical problems with Fund/SERV, or if the parties
are not able to transmit or receive information through Fund/SERV,
the following provisions shall apply:
NEXT DAY TRANSMISSION OF ORDERS. On each Business Day, the
Company shall aggregate and calculate the net purchase and
redemption orders for each Account received by the Company prior
to the Close of Trading on such Business Day. Prior to 9:00 a.m.
Eastern Time (or such other time as may be agreed by the parties
from time to time) on the next following Business Day, the Company
shall communicate to the Fund or its designee by facsimile or, in
the Company's discretion, by telephone or any other method agreed
upon by the parties, the net aggregate purchase or redemption
orders (if any) for each Account received by the Close of Trading
on the prior Business Day (the "Trade Date"). All orders
communicated to the Fund or its designee by the 9:00 a.m. deadline
(or such other time as may be agreed by the parties from time to
time) shall be treated by the Fund or its designee as if received
prior to the Close of Trading on the Trade Date.
PURCHASES. The Company will use its best efforts to transmit each
purchase order to the Fund or its designee in accordance with
written instructions previously provided by the Fund or its
designee to the Company. The Company will use its best efforts to
initiate by wire transfer to BDI or its designee purchase amounts
prior to 1:00 p.m. Eastern Time on the next Business Day following
the Trade Date.
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REDEMPTIONS. With respect to redemption orders placed by the
Company by 9:00 a.m. Eastern Time (or such other time as may be
agreed by the parties from time to time) on the first Business Day
following the Trade Date, the Fund or its designee will use its
best efforts to initiate by wire transfer to the Company proceeds
of such redemptions by 1:00 p.m. Eastern Time on the next Business
Day following the Trade Date.
1.3 Subject to Section 1.3, the Fund will redeem any full or
fractional shares of any Portfolio when requested by the Company on behalf of
an Account at the most recent net asset value provided to the Company prior
to receipt by the Fund (or the Fund's transfer agent) of the request for
redemption, as established in accordance with the operational procedures
mutually agreed to by the Fund and the Company from time to time and the
provisions of the then current prospectus of the Portfolios. The Fund shall
make payment for such shares in accordance with Section 1.4, but in no event
shall payment be delayed for a greater period than is permitted by the 1940
Act (including any Rule or order of the SEC thereunder).
1.4 (a) The Company will not aggregate orders received from its
Contract holders after close of the New York Stock Exchange (generally, 4:00
p.m. Eastern Time) ("Market Close") with orders received before Market Close,
and warrants that its internal control structure concerning the processing
and transmission of orders is suitably designed to prevent or detect on a
timely basis orders received after Market Close from being aggregated with
orders received before Market Close and to minimize errors that could result
in late transmission of orders. Orders received by Company before Market
Close will receive that day's net asset value and Orders received by Company
after Market Close will receive the next day's net asset value.
(b) The Fund shall accept purchase and redemption orders resulting
from investment in and payments under the Contracts on each Business Day,
provided that such orders are received prior to 9:00 a.m. Eastern Time and
reflect instructions received by the Company from Contract holders in good
order prior to the time the net asset value of each Portfolio is priced in
accordance with the preceding paragraph and the Fund's prospectus on the
prior Business Day. "Business Day" shall mean any day on which the New York
Stock Exchange is open for trading and on which the Fund calculates its net
asset value pursuant to the rules of the SEC. Purchase and redemption orders
shall be provided by the Company in such written or electronic form
(including, without limitation, facsimile) as may be mutually acceptable to
the Company and the Fund. The Fund may reject purchase and redemption orders
which are not in the form prescribed in the Fund's prospectus or statement of
additional information. In the event that the Company and the Fund agree to
use a form of written or electronic communication which is not capable of
recording the time, date and recipient of any communication and confirming
good transmission, the Company agrees that it shall be responsible for
confirming that any communication sent by the Company was in fact received by
the Fund or its designee, in proper form and in accordance with the terms of
this Agreement. The Fund and its agents or designees shall be entitled to
rely upon, and shall be fully protected from all liability in acting upon,
the instructions of the authorized individuals.
1.5 Purchase orders that are transmitted to the Fund or its designee
in accordance with Section 1.3 shall be paid for no later than the end of the
Business Day after the Fund or its designee receives notice of the order.
Payments shall be made in federal funds transmitted by wire. In the event
that the Company shall fail to pay in a timely manner for any purchase order
validly received by the Fund or its designee pursuant to Section 1.3, the
Company shall hold the Fund or its designee harmless from any losses
reasonably sustained by the Fund or its designee as the result of acting in
reliance on such purchase order. Redemption orders that are transmitted to
the Fund or its designee in accordance with Section 1.3 shall be paid for no
later than the end of the Business Day after the Fund receives notice of the
order. Payments shall be made in federal funds transmitted by wire. In
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the event that the Fund or its designee shall fail to pay in a timely manner
for any redemption order pursuant to Section 1.3, the Fund or its designee
shall hold the Company harmless from any losses reasonably sustained by the
Company as the result of acting in reliance on such redemption order.
1.6 Issuance and transfer of shares of the Portfolios will be by
book entry only. Share certificates will not be issued to the Company or the
Account. Shares ordered from the Fund will be recorded in the appropriate
title for each Account or the appropriate sub-account of each Account.
1.7 The Fund or its designee shall furnish prompt written notice to
the Company of any income, dividends or capital gain distribution payable on
Shares. The Company hereby elects to receive all such income dividends and
capital gain distributions as are payable on a Portfolio's Shares in
additional Shares of that Portfolio. The Fund shall notify the Company in
writing of the number of Shares so issued as payment of such dividends and
distributions.
1.8 The Fund shall make the net asset value per share for each
Portfolio available to the Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated and shall use its
best efforts to make such net asset value per share available by 6:30 p.m.
Eastern Time. If the Fund provides materially incorrect share net asset
value information, it shall make an adjustment to the number of shares
purchased or redeemed for any affected Account to reflect the correct net
asset value per share. Any material error in the calculation or reporting of
net asset value per share, dividend or capital gains information shall be
reported promptly in writing upon discovery to the Company.
1.9 The Company agrees that it will not take any action to operate
an Account as a management investment company under the 1940 Act without the
Fund's and the Underwriter's prior written consent.
1.10 The Fund agrees that its Shares will be sold only to
Participating Insurance Companies and their separate accounts. No Shares of
any Portfolio will be sold directly to the general public. The Company
agrees that Shares will be used only for the purposes of funding the
Contracts and Accounts listed in Schedule A, as amended from time to time.
1.11 The Fund agrees that all Participating Insurance Companies shall
have the obligations and responsibilities regarding conflicts of interest
corresponding to those contained in Article 4 of this Agreement.
1.12 The Fund reserves the right to reject any purchase orders,
including exchanges, for any reason, including if the Fund, in its sole
opinion, believes the Company's Contract holder(s) is engaging in short-term
or excessive trading into and out of a Portfolio or otherwise engaging in
trading that may be disruptive to a Portfolio ("Market Timing"). The Company
agrees to cooperate with the Underwriter and the Fund to monitor for Market
Timing by its Contract holders, to provide such relevant information about
Market Timers to the Fund as it may reasonably request, including but not
limited to such Contract holder's identity, and to prevent Market Timing from
occurring by or because of Contract holders. Failure of the Fund to reject
any purchase orders that might be deemed to be Market Timing shall not
constitute a waiver of the Fund's rights under this section. Pursuant to Rule
22c-2 of the 1940 Act, on behalf of the Fund, the Underwriter and the Company
agree to comply with the terms of the Shareholder Information Agreements
executed on April 16, 2007 as of the effective date of this Agreement.
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ARTICLE 2
OBLIGATIONS OF THE PARTIES
2.1 The Fund shall prepare and be responsible for filing with the
SEC and any state securities regulators requiring such filing, all
shareholder reports, notices, proxy materials (or similar materials such as
voting instruction solicitation materials), prospectuses and statements of
additional information of the Fund required to be so filed. The Fund shall
bear the costs of registration and qualification of its Shares, preparation
and filing of the documents listed in this Section 2.1 and all taxes to which
an issuer is subject on the issuance and transfer of its Shares.
2.2 At least annually, the Underwriter or its designee shall provide
the Company, free of charge, with as many copies of the current prospectus
(describing only the Portfolios listed in Schedule B hereto) for the Shares
as the Company may reasonably request for distribution to existing Contract
owners whose Contracts are funded by such Shares. The Underwriter or its
designee shall provide the Company, at the Company's expense, with as many
copies of the current prospectus for the Shares as the Company may reasonably
require for distribution to prospective purchasers of Contracts. If
requested by the Company in lieu thereof, the Underwriter or its designee
shall provide such documentation (including a "camera ready" copy of the new
prospectus as set in type or, at the request of the Company, a diskette in
the form sent to the financial printer) and other assistance as is reasonably
necessary in order for the parties hereto once each year (or more frequently
if the prospectus for the Shares is supplemented or amended) to have the
prospectus for the Shares conform to the Company's Contract prospectuses or
related materials; the expenses of such printing to be borne by the Company.
In the event that the Company requests that the Underwriter or its designee
provide the prospectus in a "camera ready" or diskette format, the
Underwriter shall be responsible solely for providing the prospectus in the
format in which it is accustomed to formatting prospectuses and shall bear
the expense of providing the prospectus in such format, and the Company shall
bear the expense of adjusting or changing the format to conform with any of
its Contract prospectuses or related materials.
2.3 The prospectus for the Shares shall state that the statement of
additional information for the Shares is available from the Fund or its
designee. The Fund or its designee, at its expense, shall print and provide
such statement of additional information to the Company (or a master of such
statement suitable for duplication by the Company) for distribution to any
owner of a Contract funded by the Shares. The Fund or its designee, at the
Company's expense, shall print and provide such statement to the Company (or
a master of such statement suitable for duplication by the Company) for
distribution to a prospective purchaser who requests such statement.
2.4 The Underwriter or its designee shall provide the Company free
of charge copies, if and to the extent applicable to the Shares, of the
Fund's proxy materials, reports to shareholders and other communications to
shareholders in such quantity as the Company shall reasonably request for
distribution to Contract owners.
2.5 With respect to any prospectus, shareholder report or proxy
solicitation materials that concern solely the Fund and no other investment
vehicle funding the Accounts, the Fund shall pay for the Company's postage
costs in connection with mailing such materials to existing Contract owners.
With respect to any prospectus, shareholder report or proxy solicitation
materials that concern the Fund together with other investment vehicles
funding the Accounts, the Fund shall pay a proportionate amount of the
Company's postage costs, based on the percentage of such Account's overall
assets that are invested in the Fund, in connection with mailing such
materials to existing Contract owners.
2.6 The Company shall furnish, or cause to be furnished, to the
Fund or its designee, a copy of language that would be used in any prospectus
for the Contracts or statement of additional
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information for the Contracts in which the Fund, the Underwriter or BAL
("Fund Parties") is named prior to the filing of such document with the SEC.
Upon request, the Company shall furnish, or shall cause to be furnished, to
the Fund or its designee, each piece of sales literature or other promotional
material in which the Fund, the Underwriter or BAL is named, at least ten
Business Days prior to its use. No such prospectus, statement of additional
information or material shall be used if any of the Fund Parties reasonably
objects to such use.
2.7 At the reasonable request of the Fund or its designee, the
Company shall furnish, or shall cause to be furnished, as soon as practical,
to the Fund or its designee copies of the following reports:
(a) the Company's annual financial report (prepared under generally
accepted accounting principles ("GAAP", if any);
(b) the Company's quarterly statements, if any;
(c) any financial statement, proxy statement, notice or report of
the Company sent to policyholders; and
(d) any registration statement (without exhibits) and financial
reports of the Company filed with any state insurance regulator.
2.8 The Company shall not give any information or make any
representations or statements on behalf of the Fund or Underwriter or
concerning the Fund, the Underwriter or BAL in connection with the Contracts
other than information or representations contained in and accurately derived
from the registration statement or prospectus for the Shares (as such
registration statement and prospectus may be amended or supplemented from
time to time), reports of the Fund, Fund-sponsored proxy statements, or in
sales literature or other promotional material approved by the Fund or
Underwriter, except with the written permission of the Fund or Underwriter.
2.9 Neither the Fund nor the Underwriter shall give any information
or make any representations or statements on behalf of the Company or
concerning the Company, the Accounts or the Contracts other than information
or representations contained in and accurately derived from the registration
statements or Contract prospectuses (as such registration statements or
Contract prospectuses may by amended or supplemented from time to time),
except with the written permission of the Company.
2.10 The Company shall register and qualify the Contracts for sale to
the extent required by applicable law. The Company shall amend the
registration statement of the Contracts under the 1933 Act and registration
statement for each Account under the 1940 Act from time to time as required
in order to effect the continuous offering of the Contracts or as may
otherwise be required by applicable law. The Company shall register and
qualify the Contracts for sale to the extent required by applicable
securities laws and insurance laws of the various states.
2.11 Solely with respect to Contracts and Accounts that are subject
to the 1940 Act, so long as, and to the extent that the SEC interprets the
1940 Act to require pass-through voting privileges for variable Contract
holders: (a) the Company will provide pass-through voting privileges to
owners of Contracts whose cash values are invested, through the Accounts, in
Shares of the Fund; (b) the Fund shall require all Participating Insurance
Companies to calculate voting privileges in the same manner and the Company
shall be responsible for assuring that the Accounts calculate voting
privileges in the manner established by the Fund; (c) with respect to each
Account, the Company will vote Shares of the Fund held by the Account and for
which no timely voting instructions from Contract or Contract holders are
received, as well as Shares held by the Account that are owned by
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the Company for their general accounts, in the same proportion as the Company
votes Shares held by the Account for which timely voting instructions are
received from Contract owners; and (d) the Company and its agents will in no
way recommend or oppose or interfere with the solicitation of proxies for
Fund Shares held by Contract owners without the prior written consent of the
Fund, which consent may be withheld in the Fund's sole discretion.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
3.1 The Company represents and warrants that it is an insurance
company duly organized and in good standing under the laws of the States of
Indiana and New York, with full power, authority and legal right to execute,
deliver and perform its duties and comply with its obligations under this
Agreement and has established each Account as a separate account under such
law and the Accounts comply in all material respects with all applicable
federal and state laws and regulations.
3.2 The Company represents and warrants that it has registered or,
prior to any issuance or sale of the Contracts, will register each Account as
a unit investment trust in accordance with the provisions of the 1940 Act to
serve as a separate account for the Contracts. The Company further
represents and warrants that the Contracts will be registered under the 1933
Act prior to any issuance or sale of the Contracts; the Contracts will be
issued in compliance in all material respects with all applicable federal and
state laws.
3.3 The Company represents and warrants that the Contracts are
currently and at the time of issuance will be treated as annuity contracts or
life insurance policies, whichever is appropriate, under applicable
provisions of the Internal Revenue Code of 1986, as amended ("Code"). The
Company shall make every effort to maintain such treatment and shall notify
the Fund and the Underwriter immediately upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or that they might
not be so treated in the future.
3.4 The Fund represents and warrants that it is duly organized and
validly existing under the laws of the State of Maryland.
3.5 The Fund represents and warrants that the Fund Shares offered
and sold pursuant to this Agreement will be registered under the 1933 Act and
the Fund is registered under the 0000 Xxx. The Fund shall amend its
registration statement under the 1933 Act and the 1940 Act from time to time
as required in order to effect the continuous offering of its shares. If the
Fund determines that notice filings are appropriate, the Fund shall use its
best efforts to make such notice filings in accordance with the laws of such
jurisdictions reasonably requested by the Company.
3.6 The Fund has adopted a Distribution Plan (the "Plan") with
regard to the Class II and Class III shares of each Portfolio, pursuant to
Rule 12b-1 under the Investment Company Act. The Plan permits the Underwriter
to pay to each Insurance Company that enters into an agreement with the
Underwriter to provide distribution related services to Contract owners, a
fee, at the end of each month, of up to 0.15% of the net asset value of the
Class II shares and up to 0.25% of the net asset value of Class III shares of
each Portfolio held by such Insurance Company. The Company agrees to waive
the payment of any such distribution fee unless and until Underwriter has
received such fees from the Fund. Payments under this provision shall be made
to the Distributor.
3.7 The Fund represents that it will comply and maintain each
Portfolio's compliance with the diversification requirements set forth in
Section 817(h) of the Code and Section 1.817-5 of the regulations under the
Code. The Fund will notify the Company immediately upon having a reasonable
basis for believing that a Portfolio has ceased to so comply or that a
Portfolio might not
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so comply in the future. In the event of a breach of this Section 3.6 by the
Fund, it will take all reasonable steps to adequately diversify the Portfolio
so as to achieve compliance within the grace period afforded by Section
1.817-5 of the regulations under the Code.
3.8 The Fund represents and warrants that each Portfolio is
currently qualified as a regulated investment company ("RIC") under
Subchapter M of the Code, and represents that it will use its best efforts to
qualify and to maintain qualification of each Portfolio as a RIC. The Fund
will notify the Company immediately in writing upon having a reasonable basis
for believing that a Portfolio has ceased to so qualify or that it might not
so qualify in the future.
3.9 The Company hereby certifies that it has established and
maintains an anti-money laundering ("AML") program that includes written
policies, procedures and internal controls reasonably designed to identify
its Contract holders and has undertaken appropriate due diligence efforts to
"know its customers" in accordance with all applicable anti-money laundering
regulations in its jurisdiction including, but not limited to, the USA
PATRIOT Act of 0000 (xxx "Xxxxxxx Xxx"). The Company further confirms that
it will monitor for suspicious activity in accordance with the requirements
of the Patriot Act and any other applicable regulations. The Company agrees
to provide the Fund with such information as it may reasonably request,
including but not limited to, the filling out of questionnaires, attestations
and other documents, to enable the Fund to fulfill its obligations under the
Patriot Act, and, upon its request, to file a notice pursuant to Section 314
of the Patriot Act and the implementing regulations related thereto to permit
the voluntary sharing of information between the parties hereto. Upon filing
such a notice the Company agrees to forward a copy to the Fund, and further
agrees to comply with all requirements under the Patriot Act and implementing
regulations concerning the use, disclosure, and security of any information
that is shared.
3.10 The Company acknowledges and agrees that it is the
responsibility of the Company to determine investment restrictions under
state insurance law applicable to any Portfolio, and that the Fund shall bear
no responsibility to the Company, for any such determination or the
correctness of such determination. The Company has determined that the
investment restrictions set forth in the current Fund Prospectus are
sufficient to comply with all investment restrictions under state insurance
laws that are currently applicable to the Portfolios as a result of the
Accounts' investment therein. The Company shall inform the Fund of any
additional investment restrictions imposed by state insurance law after the
date of this agreement that may become applicable to the Fund or any
Portfolio from time to time as a result of the Accounts' investment therein.
Upon receipt of any such information from the Company, the Fund shall
determine whether it is in the best interests of shareholders to comply with
any such restrictions. If the Fund determines that it is not in the best
interests of shareholders to comply with a restriction determined to be
applicable by the Company, the Fund shall so inform the Company, and the Fund
and the Company shall discuss alternative accommodations in the circumstances.
3.11 The Company represents and warrants that each Account is a
"segregated asset account" and that interests in each Account are offered
exclusively through the purchase of or transfer into a "variable contract,"
within the meaning of such terms under Section 817 of the Code and the
regulations thereunder. The Company will use its best efforts to continue to
meet such definitional requirements, and it will notify the Fund immediately
upon having a reasonable basis for believing that such requirements have
ceased to be met or that they might not be met in the future.
ARTICLE 4
POTENTIAL CONFLICTS
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4.1 The parties acknowledge that the Fund's Shares may be made
available for investment to other Participating Insurance Companies. In such
event, the Directors of the Fund will monitor the Fund for the existence of
any material irreconcilable conflict between the interests of the contract
owners of all Participating Insurance Companies. An irreconcilable material
conflict may arise for a variety of reasons, including: (a) an action by any
state insurance regulatory authority; (b) a change in applicable federal or
state insurance, tax, or securities laws or regulations, or a public ruling,
private letter ruling, no-action or interpretative letter, or any similar
action by insurance, tax, or securities regulatory authorities; (c) an
administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of any Portfolio are being managed; (e) a
difference in voting instructions given by variable annuity contract and
variable life insurance contract owners; or (f) a decision by an insurer to
disregard the voting instructions of contract owners. The Directors shall
promptly inform the Company in writing if they determine that an
irreconcilable material conflict exists and the implications thereof.
4.2 The Company agrees to promptly report any potential or existing
conflicts of which it is aware to the Directors. The Company will assist the
Directors in carrying out their responsibilities under the Shared Fund
Exemptive Order by providing the Directors with all information reasonably
necessary for them to consider any issues raised including, but not limited
to, information as to a decision by the Company to disregard Contract owner
voting instructions.
4.3 If it is determined by a majority of the Directors, or a
majority of the Fund's Directors who are not affiliated with the Adviser or
the Underwriter (the "Disinterested Directors"), that a material
irreconcilable conflict exists that affects the interests of Contract owners,
the Company shall, in cooperation with other Participating Insurance
Companies whose contract owners are also affected, at its expense and to the
extent reasonably practicable (as determined by the Directors) take whatever
steps are necessary to remedy or eliminate the irreconcilable material
conflict, which steps could include: (a) withdrawing the assets allocable to
some or all of the Accounts from the Fund or any Portfolio and reinvesting
such assets in a different investment medium, including (but not limited to)
another Portfolio of the Fund, or submitting the question of whether or not
such segregation should be implemented to a vote of all affected Contracts
owners and, as appropriate, segregating the assets of any appropriate group
(i.e., annuity contract owners, life insurance contract owners, or variable
contract owners of one or more Participating Insurance Companies) that votes
in favor of such segregation, or offering to the affected Contract owners the
option of making such a change; and (b) establishing a new registered
management investment company or managed separate account.
4.4 If a material irreconcilable conflict arises because of a
decision by the Company to disregard Contract owner voting instructions and
that decision represents a minority position or would preclude a majority
vote, the Company may be required, at the Fund's election, to withdraw the
affected Account's investment in the Fund and terminate this Agreement with
respect to such Account; provided, however, that such withdrawal and
termination shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the Disinterested
Directors. Any such withdrawal and termination must take place within 30
days after the Fund gives written notice that this provision is being
implemented, subject to applicable law but in any event consistent with the
terms of the Shared Fund Exemptive Order. Until the end of such 30 day
period, the Fund shall continue to accept and implement orders by the Company
for the purchase and redemption of Shares.
4.5 If a material irreconcilable conflict arises because a
particular state insurance regulator's decision applicable to the Company
conflicts with the majority of other state regulators, then the Company will
withdraw the affected Account's investment in the Fund and terminate this
Agreement with respect to such Account within 30 days after the Fund informs
the Company in writing that it has determined that such decision has created
an irreconcilable material conflict;
10
provided, however, that such withdrawal and termination shall be limited to
the extent required by the foregoing material irreconcilable conflict as
determined by a majority of the Disinterested Directors. Until the end of
such 30 day period, the Fund shall continue to accept and implement orders by
the Company for the purchase and redemption of shares of the Fund.
4.6 For purposes of section 4.3 through 4.6 of this Agreement, a
majority of the Disinterested Directors shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no
event will the Company be required to establish a new funding medium for the
Contracts if an offer to do so has been declined by vote of a majority of
Contract owners materially adversely affected by the irreconcilable material
conflict. In the event that the Directors determine that any proposed action
does not adequately remedy any irreconcilable material conflict, then the
Company will withdraw the Account's investment in the Fund and terminate this
Agreement within 30 days after the Directors inform the Company in writing of
the foregoing determination; provided, however, that such withdrawal and
termination shall be limited to the extent required by any such material
irreconcilable conflict as determined by a majority of the Disinterested
Directors.
4.7 Upon request, the Company shall submit to the Directors such
reports, materials or data as the Directors may reasonably request so that
the Directors may fully carry out the duties imposed upon them by the Shared
Fund Exemptive Order, and said reports, materials and data shall be submitted
more frequently if deemed appropriate by the Directors.
4.8 If and to the extent that (a) Rule 6e-2 and Rule 6e-3 (T) are
amended, or Rule 6e-3 is adopted, to provide exemptive relief from any
provision of the 1940 Act or the rules promulgated thereunder with respect to
mixed or shared funding (as defined in the application for the Shared Fund
Exemptive Order) on terms and conditions materially different from those
contained in the application for the Shared Fund Exemptive Order, or (b) the
Shared Fund Exemptive Order is granted on terms and conditions that differ
from those set forth in this Article 4, then the Fund and/or the
Participating Insurance Companies, as appropriate, shall take such steps as
may be necessary (a) to comply with Rules 6e-2 and 6e-3 (T), as amended, and
Rule 6e-3, as adopted, to the extent such rules are applicable, or (b) to
conform this Article 4 to the terms and conditions contained in the Shared
Fund Exemptive Order, as the case may be.
ARTICLE 5
INDEMNIFICATION
5.1 The Company agrees to indemnify and hold harmless the Fund
Parties and each of their respective Directors, officers, employees and
agents and each person, if any, who controls a Fund Party within the meaning
of Section 15 of the 1933 Act (collectively the "Indemnified Parties" for
purposes of this Article 5) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
the Company) or expenses (including the reasonable costs of investigating or
defending any alleged loss, claim, damage, liability or expense and
reasonable legal counsel fees incurred in connection therewith)
(collectively, "Losses"), to which the Indemnified Parties may become subject
under any statute or regulation, or common law or otherwise, insofar as such
Losses:
(a) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the prospectuses
for the Contracts or in the Contracts themselves or in sales literature
generated or approved by the Company on behalf of the Contracts or Accounts
(or any amendment or supplement to any of the foregoing) (collectively,
"Company Documents" for the purposes of this Article 5), or arise out of or
are based upon the omission or the alleged omission to state therein a
material fact required to be
11
stated therein or necessary to make the statements therein not misleading,
provided that this indemnity shall not apply as to any Indemnified Party if
such statement or omission or such alleged statement or omission was made in
reliance upon and was accurately derived from written information furnished
to the Company by or on behalf of the Fund or Underwriter for use in Company
Documents or otherwise for use in connection with the sale of the Contracts
or Shares; or
(b) arise out of or result from statements or representations
(other than statements or representations contained in and accurately derived
from Fund Documents as defined in Section 5.2(a)) or wrongful conduct of the
Company or persons under its control, with respect to the sale or acquisition
of the Contracts or Shares; or
(c) arise out of or result from any untrue statement or alleged
untrue statement of a material fact contained in Fund Documents as defined in
Section 5.2(a) or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission was made in
reliance upon and accurately derived from written information furnished to
the Fund or Underwriter by or on behalf of the Company; or
(d) arise out of or result from any failure by the Company to
provide the services or furnish the materials required under the terms of
this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this Agreement or arise
out of or result from any other material breach of this Agreement by the
Company.
5.2 The Underwriter and each Fund agree severally to indemnify and
hold harmless the Company and each of its directors, officers, employees and
agents and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act (collectively, the "Indemnified Parties" for
purposes of this Article 5) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
the Fund Parties) or expenses (including the reasonable costs of
investigating or defending any alleged loss, claim, damage liability or
expense and reasonable legal counsel fees incurred in connection therewith)
(collectively, "Losses"), to which the Indemnified Parties may become subject
under any statute or regulation, or at common law or otherwise, insofar as
such Losses:
(a) arise out of or are based upon any untrue statements or
alleged untrue statement of any material fact contained in the registration
statement or prospectus for the Fund (or any amendment or supplement thereto)
(collectively, "Fund Documents" for the purposes of this Article 5), or arise
out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, provided that this indemnity shall not
apply as to any Indemnified Party if such statement or omission or such
alleged statement or omission was made in reliance upon and was accurately
derived from written information furnished to the Fund Parties by or on
behalf of the Company for use in Fund Documents or otherwise for use in
connection with the sale of the Contracts or Shares; or
(b) arise out of or result from statements or representations
(other than statements or representations contained in and accurately derived
from
12
Company Documents) or wrongful conduct of a Fund Party or persons under
its respective control, with respect to the sale or acquisition of the
Contracts or Shares; or
(c) arise out of or result from any untrue statement or alleged
untrue statement of a material fact contained in Company Documents or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading if
such statement or omission was made in reliance upon and accurately derived
from written information furnished to the Company by or on behalf of the Fund
Parties; or
(d) arise out of or result from any failure by the Underwriter or
the Fund to provide the services or furnish the materials required under the
terms of this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by the Underwriter or the Fund in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Underwriter or the Fund.
5.3 Neither the Company, the Underwriter nor the Fund shall be
liable under the indemnification provisions of Section 5.1 or 5.2, as
applicable, with respect to any Losses incurred or assessed against any
Indemnified Party to the extent such Losses arise out of or result from such
Indemnified Party's willful misfeasance, bad faith or gross negligence in the
performance of such Indemnified Party's duties or by reason of such
Indemnified Party's reckless disregard of obligations or duties under this
Agreement.
5.4 Neither the Company, the Underwriter nor the Fund shall be
liable under the indemnification provisions of Section 5.1 or 5.2, as
applicable, with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified the other party in writing
within a reasonable time after the summons, or other first written
notification, giving information of the nature of the claim shall have been
served upon or otherwise received by such Indemnified Party (or after such
Indemnified Party shall have received notice of service upon or other
notification to any designated agent), but failure to notify the party
against whom indemnification is sought of any such claim shall not relieve
that party from any liability which it may have to the Indemnified Party in
the absence of Sections 5.1 and 5.2.
In case any such action is brought against the Indemnified Parties, the
indemnifying party shall be entitled to participate, at its own expense, in
the defense of such action. The indemnifying party also shall be entitled to
assume the defense thereof, with counsel reasonably satisfactory to the party
named in such action. After notice from the indemnifying party to the
Indemnified Party of an election to assume such defense, the Indemnified
Party shall bear the fees and expenses of any additional counsel retained by
it, and the indemnifying party will not be liable to the Indemnified Party
under this Agreement for any legal or other expenses subsequently incurred by
such party independently in connection with the defense thereof other than
reasonable costs of investigation.
ARTICLE 6
TERMINATION
6.1 This Agreement may be terminated by either party for any reason
by sixty (60) days' advance written notice delivered to the other party.
13
6.2 This Agreement may be terminated at the option of either the
Underwriter or the Fund upon institution of formal proceedings against the
Company by the FINRA, the SEC, the insurance commission of any state or any
other regulatory body regarding the Company's duties under this Agreement or
related to the sale of the Contracts, the operation of the Account, the
administration of the Contracts or the purchase of the Shares, or an expected
or anticipated ruling, judgment or outcome which would, in the Fund's or the
Underwriter's respective reasonable judgment, materially impair the Company's
ability to meet and perform the Company's obligations and duties hereunder.
6.3 This Agreement may be terminated at the option of the Fund or
the Underwriter if the Internal Revenue Service determines that the Contracts
cease to qualify as annuity contracts or life insurance policies, as
applicable, under the Code, or if the Fund or Underwriter reasonably believes
that the Contracts may fail to so qualify or if interests in an Account under
the Contracts are not registered, where required, and, in all material
respects, are not issued or sold in accordance with any applicable federal or
state law.
6.4 This Agreement may be terminated by the Fund or the Underwriter,
at either's option, if either the Fund or the Underwriter shall determine, in
its sole judgment exercised in good faith, that either (1) the Company shall
have suffered a material adverse change in its business or financial
condition, (2) the Company shall have been the subject of material adverse
publicity which is likely to have a material adverse impact upon the business
and operations of either the Fund or the Underwriter, or (3) the Company
breaches any obligation under this Agreement in a material respect and such
breach shall continue unremedied for thirty (30) days after receipt by the
Company of notice in writing from the Fund or Underwriter of such breach.
6.5 This Agreement may be terminated at the option of the Company if
(A) the Internal Revenue Service determines that any Portfolio fails to
qualify as a RIC under the Code or fails to comply with the diversification
requirements of Section 817(h) of the Code and the Fund, upon written request
fails to provide reasonable assurance that it will take action to cure such
failure, or (B) the Company shall determine, in its sole judgment exercised
in good faith, that either (1) the Fund or the Underwriter shall have been
the subject of material adverse publicity which is likely to have a material
adverse impact upon the business and operations of the Company, or (2) the
Fund or Underwriter breaches any obligation under this Agreement in a
material respect and such breach shall continue unremedied for thirty (30)
days after receipt of notice in writing to the Fund or the Underwriter from
the Company of such breach.
6.6 Notwithstanding any termination of this Agreement, the Fund
will, upon the mutual agreement of the parties hereto, continue to make
available additional shares of the Fund pursuant to the terms and conditions
of this Agreement, for all existing Contracts in effect on the effective date
of termination of this Agreement (hereinafter referred to as "Existing
Contracts"). Specifically, without limitation, if the Fund and Underwriter
so agree to make additional Shares available, the owners of the Existing
Contracts will be permitted to reallocate investments in the Fund (as in
effect on such date), redeem investments in the Fund and/or invest in the
Fund upon the making of additional purchase payments under the Existing
Contracts.
6.7 In the event of a termination of this Agreement pursuant to this
Article 6, the Fund and the Underwriter shall promptly notify the Company in
writing whether the Underwriter and the Fund will continue to make Shares
available after such termination; if the Underwriter and the Fund will
continue to make Shares so available, the provisions of this Agreement shall
remain in effect except for Section 6.1 and thereafter either the Fund,
Underwriter or the Company may terminate the Agreement as so continued
pursuant to this Section 6.7 upon prior written notice to the other parties,
such notice to be for a period that is reasonable under the circumstances but
need not be greater than six months.
14
6.8 The provisions of Article 5 shall survive the termination of
this Agreement, and the provisions of Articles 2 and 4 shall survive the
termination of this Agreement as long as shares of the Fund are held on
behalf of Contract owners in accordance with Section 6.7.
ARTICLE 7
NOTICES
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth
below or at such other address as such party may from time to time specify in
writing to the other party.
To the Fund:
BlackRock Variable Series Funds, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxxx
With a copy to:
Xxxxxx Xxxxxxxx
General Counsel
BlackRock, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
To the Underwriter:
BlackRock Investments, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
With a copy to:
BlackRock Investments, Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxx, Chief Compliance Officer
15
If to the Company:
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
ARTICLE 8
MISCELLANEOUS
8.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.
8.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
8.3 If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
8.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of New York
without reference to the conflict of laws provisions thereof, and shall, to
the extent applicable, be subject to the provisions of the 1933, 1934, and
1940 Acts, and the rules, regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant
and the terms hereof shall be interpreted and construed in accordance
therewith.
8.5 The parties to this Agreement acknowledge and agree that the Fund
is a Maryland corporation, and that all liabilities of the Fund arising,
directly or indirectly, under this Agreement, of any and every nature
whatsoever, shall be satisfied solely out of the assets of the relevant
Portfolio(s) of the Fund and that no Director, officer, agent or holder of
Shares of the Fund shall be personally liable for any such liabilities.
8.6 Each party shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC,
the FINRA and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any
investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
8.7 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, to which the parties hereto are entitled
under state and federal laws.
8.8 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect.
8.9 Neither this Agreement nor any rights or obligations hereunder
may be assigned by either party without the prior written approval of the
other parties.
16
8.10 No provisions of this Agreement may be amended or modified in
any manner except by a written agreement properly authorized and executed by
all parties.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Fund Participation Agreement as of the date and year
first above written.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
By: /s/ Xxxxxx X. Xxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
LINCOLN FINANCIAL DISTRIBUTORS, INC.
By: /s/ Xxxxx X. Xxxx
------------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President & Director
BLACKROCK VARIABLE SERIES FUNDS, INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Assistant Secretary
BLACKROCK INVESTMENTS, LLC
By: /s/ Xxxxx Xxxxxxxx
------------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Managing Director
17
SCHEDULE A
Separate Accounts of The Lincoln National Life Insurance Company
participating in Portfolios of BlackRock Variable Series Funds, Inc.
Lincoln National Variable Annuity Account C
Lincoln National Variable Annuity Account L
Lincoln Life Variable Annuity Account N
Lincoln Life Variable Annuity Account Q
Lincoln Life Variable Life Account M
Lincoln Life Variable Life Account R
Lincoln Life Variable Life Account S
Lincoln Life Variable Life Account Z
Separate Accounts of Lincoln Life & Annuity Company of New York participating
in Portfolios of BlackRock Variable Series Funds, Inc.
Lincoln Life & Annuity Variable Annuity Account L
Lincoln New York Account N for Variable Annuities
Lincoln Life & Annuity Variable Account M
Lincoln Life & Annuity Variable Account R
Lincoln Life & Annuity Variable Account S
Lincoln Life Variable Life Account Z
SCHEDULE B
Portfolios and Classes of BlackRock Variable Series Funds, Inc. offered to
Separate Accounts of The Lincoln National Life Insurance Company and Lincoln
Life & Annuity Company of New York
All available share classes of:
CLASS FUND NAME CUSIP TICKER
I BlackRock Balanced Capital V.I. Fund 00000X000 AMBLI
I BlackRock Basic Value X.X. Xxxx 00000X000 XXXXX
II BlackRock Basic Value V.I. Fund 00000X000 BAVII
III BlackRock Basic Value V.I. Fund 00000X000 BVIII
I BlackRock Fundamental Growth V.I. Fund 00000X000 FDGRI
I BlackRock Global Allocation V.I. Fund 00000X000 GLALI
II BlackRock Global Allocation V.I. Fund 00000X000 GLAII
III BlackRock Global Allocation V.I. Fund 00000X000 GAIII
I BlackRock Global Growth X.X. Xxxx 00000X000 XXXXX
III BlackRock Global Growth X.X. Xxxx 00000X000 XXXXX
I BlackRock Government Income X.X. Xxxx 00000X000 XXXXX
I BlackRock High Income V.I. Fund 00000X000 HICUI
I BlackRock International Value X.X. Xxxx 00000X000 XXXXX
I BlackRock Large Cap Core V.I. Fund 00000X000 LGCCI
II BlackRock Large Cap Core V.I. Fund 00000X000 LGCII
III BlackRock Large Cap Core V.I. Fund 00000X000 LCIII
I BlackRock Large Cap Growth V.I. Fund 00000X000 LGGGI
III BlackRock Large Cap Growth X.X. Xxxx 00000X000 XXXXX
I BlackRock Large Cap Value V.I. Fund 00000X000 LCVAX
II BlackRock Large Cap Value V.I. Fund 00000X000 LCVBX
III BlackRock Large Cap Value V.I. Fund 00000X000 LVIII
I BlackRock Money Market V.I. Fund 00000X000 DMMKI
I BlackRock S&P 500 Index V.I. Fund 00000X000 IDXVI
II BlackRock S&P 500 Index V.I. Fund 00000X000 IXVII
I BlackRock Total Return V.I. Fund 00000X000 CRBDI
I BlackRock Utilities and Telecommunications
X.X. Xxxx 00000X000 XXXXX
I BlackRock Value Opportunities V.I. Fund 00000X000 SMCPI
II BlackRock Value Opportunities V.I. Fund 00000X000 SMCII
III BlackRock Value Opportunities V.I. Fund 00000X000 SCIII
Amendment to Agreements
BlackRock Advisors, LLC ("BAL") has entered into Fund Participation and/or
administrative Services Agreements (the "Agreements"), with your Firm
("Firm") for operational & recordkeeping services ("Services"). The parties
hereby agree to amend the Agreements, effective as of 07/1/1 0, with the
following terms:
1. The invoicing language will be replaced in its entirety with the
following:
Firm shall calculate the payment contemplated by Section 1 of the Agreement
at the end of each quarter ("Quarterly Payment"). BAL will submit such
payment to Firm, after the receipt of an invoice by Firm.
Please submit invoices to BAL at: XxxXxxxxxxx.Xxxxxxxx@xxxxxxxxx.xxx.
The invoice will be submitted on a quarterly basis in a Microsoft Excel
format and include the following information:
1. The total average daily net assets during the period covered by the
invoice by Fund and Share Class (ticker/CUSIP).
2. The basis point rate that applies to each account.
3. The subtotal amount due by Fund and Share Class (ticker/CUSIP).
4. The total amount due.
S. Invoice submitted on Firm letterhead.
6. Each invoice to include an invoice number.
7. Payment instructions (Wire/Check/ACH).
8. Contact information for the Firm.
Invoices must be received in a timely manner. Any invoice which is received
subsequent to 6 months after the time period covered by the invoice may be
subject to non-payment. additions or adjustments to previously received
invoices submitted subsequent to 6 months after the time period covered by
the invoice may also be subject to non-payment.
The parties acknowledge and agree that the assets and/or accounts covered
under the terms of this Agreement will not be subject to fees or any
additional payment arrangements with BAL or its affiliates for operational
and recordkeeping services, sub-transfer agency, sub-accounting, networking
services or for any similar services, other than as described herein. Firm
represents and warrants that they are not invoicing BAL or its affiliates for
duplicative fees as described in the preceding sentence.
Any invoices shall only cover time periods for which this Agreement is in
effect.
1
2. BlackRock Variable Series Funds, Inc. fund Exhibit
The parties hereby agree to delete any prior fund schedules or exhibits and
replace with an updated fund Exhibit. The parties hereby agree to amend this
fund Exhibit as needed from time to time by mutual consent.
Exhibit
BlackRock Variable Series Funds, Inc. fund list
FUND NAME CLASS CUSIP TICKER
EQUITY FUNDS
BlackRock Balanced Capital V.I. Fund I 00000X000 AMBLI
BlackRock Basic Value V.I. Fund I 00000X000 XXXXX
BlackRock Basic Value V.I. Fund II 00000X000 BAVII
BlackRock Basic Value V.I. Fund III 00000X000 BVIII
BlackRock Capital Appreciation V.I. Fund I 00000X000 FDGRI
BlackRock Capital Appreciation X.X. Xxxx XXX 00000X000 XXXXX
BlackRock Global Allocation V.I. Fund I 00000X000 GLALI
BlackRock Global Allocation X.X. Xxxx XX 00000X000 XXXXX
BlackRock Global Allocation V.I. Fund III 00000X000 GAIII
BlackRock Global Opportunities V.I. Fund I 00000X000 GLGRI
BlackRock Global Opportunities V.I. Fund III 00000X000 GGIII
BlackRock International Value V.I. Fund I 00000X000 IVVVI
BlackRock Large Cap Core V.I. Fund I 00000X000 LGCCI
BlackRock Large Cap Core V.I. Fund II 00000X000 LGCII
BlackRock Large Cap Core X.X. Xxxx XXX 00000X000 LCIII
BlackRock Large Cap Growth V.I. Fund I 00000X000 LGGGI
BlackRock Large Cap Growth X.X. Xxxx XXX 00000X000 XXXXX
BlackRock Large Cap Value V.I. Fund I 00000X000 LCATT
BlackRock Large Cap Value V.I. Fund II 00000X000 LCBTT
BlackRock Large Cap Value V.I. Fund III 00000X000 LVIII
BlackRock Utilities and Telecommunications V.I. Fund* I 00000X000 UTTLI
BlackRock Utilities and Telecommunications V.I. Fund* III 00000X000 UTIII
BlackRock Value Opportunities V.I. Fund I 00000X000 SMCPI
BlackRock Value Opportunities V.I. Fund II 00000X000 SMCII
BlackRock Value Opportunities V.I. Fund III 00000X000 SCIII
FIXED INCOME FUNDS
BlackRock Government Income V.I. Fund I 00000X000 GVBDI
BlackRock High Income V.I. Fund I 00000X000 HICUI
BlackRock Total Return V.I. Fund I 00000X000 CRBDI
BlackRock Total Return V.I. Fund III 00000X000 CBIII
INDEX FUND
BlackRock S&P 500 Index V.I. Fund I 09253L4678 IDXVI
BlackRock S&P 500 Index X.X. Xxxx XX 00000X000 IXVII
MONEY MARKET FUND
BlackRock Money Market V.I. Fund** I 00000X000 DMMKI
*Name change to BlackRock Equity Dividend V.I. Fund effective October 1,2010
**No operational & recordkeeping payments will be made on the this fund
To the extent that provisions of the Agreement(s) and this Amendment are
in conflict, the terms of this Amendment shall control. Except to the extent
amended by this Amendment, the Agreement(s) shall remain unchanged and in
full force and effect, and are hereby ratified and confirmed in all respects
as amended hereby.
Signature page follows
3
Agreed and Accepted:
Firm Name: Lincoln National Life Insurance Company
Signature: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
Dated: September 27, 2010
Firm Name: Lincoln Life and Annuity Company of New York
Signature: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
Dated: September 27, 2010
Firm Name: BlackRock Advisors, LLC
Signature: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Managing Director
Date: October 15, 2010
Firm Name: BlackRock Investments
Signature: /s/ Xxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx
Title: Managing Director
Dated: 10/25, 2010
Firm Name: BlackRock Variable Insurance Series, Inc.
Signature: /s/ illegible
Name:
Title: Assistant Secretary
Dated:
4
