EX-99.B(h)(5)(viii)
PARTICIPATION AGREEMENT
By and Among
XXXXX FARGO VARIABLE TRUST
And
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
And
XXXXXXXX INC.
THIS AGREEMENT, made and entered into this 20/th/ day of August, 2001,
by and among The Lincoln National Life Insurance Company, an Indiana corporation
(the "Company"), on its own behalf and on behalf of each separate account of the
Company named in Exhibit A to this Agreement, as may be amended from time to
time (each separate account, a "Separate Account"), and Xxxxx Fargo Variable
Trust, an open-end diversified management investment company organized under the
laws of the State of Delaware (the "Trust"), and Xxxxxxxx Inc., an Arkansas
corporation (the "Underwriter").
WHEREAS, the Trust engages in business as an open-end diversified,
management investment company and was established for the purpose of serving as
the investment vehicle for separate accounts established for variable life
insurance contracts and variable annuity contracts to be offered by insurance
companies which have entered into participation agreements substantially similar
to this Agreement ("Participating Insurance Companies"); and
WHEREAS, beneficial interests in the Trust are divided into several
series of shares, each representing the interest in a particular managed
portfolio of securities and other assets (each, a "Fund"); and
WHEREAS, an order from the U.S. Securities and Exchange Commission (the
"SEC" or "Commission"), dated Sept. 28, 1998 (File No. 812-11158), grants
Participating Insurance Companies and variable annuity separate accounts and
variable life insurance separate accounts relief from the provisions of Sections
9(a), 13(a), 15(a) and 15(b) of the Investment Company Act of 1940, as amended
(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 Trust to be sold to and held by
variable annuity separate accounts and variable life insurance separate accounts
of both affiliated and unaffiliated Participating Insurance Companies and
qualified pension and retirement plans ("Mixed and Shared Funding Order"), and
WHEREAS, the Trust is registered as an open-end management investment
company under the 1940 Act and its shares are registered under the Securities
Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Company has registered or will register certain variable
annuity and variable life insurance contracts under the 1933 Act, unless exempt
therefrom, and named in Exhibit A to this Agreement, as it may be amended from
time to time (the "Contracts"); and
WHEREAS, the Separate Accounts are duly organized, validly existing
segregated asset accounts, established by resolution of the Board of Directors
of the Company under the insurance laws of the State of Indiana, to set aside
and invest assets attributable to the Contracts; and
WHEREAS, the Company has registered the Separate Accounts as unit
investment trusts under the 1940 Act, unless exempt therefrom; and
WHEREAS, the Underwriter is registered as a broker-dealer with the SEC
under the Securities Exchange Act of 1934, as amended (hereinafter the "1934
Act"), and is a member in good standing of the National Association of
Securities Dealers, Inc. (hereinafter "NASD");
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Funds named in
Exhibit B on behalf of the Separate
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Accounts to fund the Contracts, and the Underwriter is authorized to
sell such shares to unit investment trusts such as the Separate Accounts at net
asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Trust, and the Underwriter agree as follows:
ARTICLE I Sale of Trust Shares
--------------------
1.1. The Underwriter agrees to sell to the Company those shares of the Trust
which the Company orders on behalf of the Separate Accounts, executing
such orders on a daily basis at the net asset value next computed after
receipt and acceptance by the Trust or its designee of the order for
the shares of the Trust. For purposes of this Section 1.1, the Company
shall be the designee of the Trust for receipt of such orders from each
Separate Account and receipt by such designee shall constitute receipt
by the Trust; provided that the Trust receives notice of such order by
9:30 a.m. New York Time on the next following Business Day. "Business
Day" shall mean any day on which the New York Stock Exchange is open
for trading. Exceptions will be approved on a case by case basis. The
Trust will confirm receipt of each trade (ending share balance by
account and fund) by 11:00 am New York Time on the day the trade is
placed with the Trust using a mutually agreed upon format.
1.2. The Trust agrees to make its shares available indefinitely for purchase
at the applicable net asset value per share by Participating Insurance
Companies and their separate accounts on each Business Day; provided,
however, that the Board of Trustees of the Trust (hereinafter the
"Trustees") may refuse to sell shares of any Fund to any person, or
suspend or terminate the offering of shares of any Fund, if such action
is required by law or by regulatory authorities having jurisdiction, or
is, in the sole discretion of the Trustees, acting in good faith and in
light of their fiduciary duties under federal and any applicable state
laws, necessary in the best interests of the shareholders of such Fund.
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1.3. The Trust and the Underwriter agree that shares of the Trust will be
sold only to Participating Insurance Companies and their separate
accounts, and to qualified pension and retirement plans. No shares of
the Trust will be sold to the general public.
1.4. The Trust and the Underwriter will not sell Trust shares to any
insurance company or separate account unless an agreement containing
provisions substantially the same as Articles I, III, V, VII, and
Section 2.8 of Article II of this Agreement are in effect to govern
such sales.
1.5. The Trust will not accept a purchase order from qualified pension or
retirement plan if such purchase would make the plan shareholder an
owner of 10 percent or more of the assets of a Fund unless such plan
executes an agreement with the Trust governing participation in such
Fund that includes the conditions set forth herein to the extent
applicable. A qualified pension or retirement plan will execute an
application containing an acknowledgment of this condition at the time
of its initial purchase of shares of any Fund.
1.6. The Trust agrees to redeem for cash, upon the Company's request, any
full or fractional shares of the Trust held by the Company, executing
such requests on a daily basis at the net asset value next computed
after receipt and acceptance by the Trust or its designee of the
request for redemption. For purposes of this Section 1.6, the Company
shall be the designee of the Trust for receipt of requests for
redemption from each Separate Account and receipt by such designee
shall constitute receipt by the Trust; provided the Trust receives
notice of request for redemption by 9:30 a.m. New York Time on the next
following Business Day. Payment shall be made on the same Business Day
that the Trust receives notice of the order in federal funds initiated
by wire to the Company's account as designated by the Company in
writing no later than the end of that Business Day as long as the
banking system is open for business. If the banking system is closed,
payment will be initiated the next day the banking system is open for
business. If payment is not received by the Company by the end of the
Business Day, the Trust shall, upon the Company's request, promptly
reimburse the Company for any charges, costs, fees, interest or other
expenses incurred in connection with advances, borrowing or overdrafts.
Interest will bear a rate per annum equal to the Federal Funds Rate.
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1.7. Purchase, redemption, and exchange orders placed by the Company shall
be placed separately for each Fund and shall not be netted with respect
to any Fund With respect to payment of the purchases by the Company and
of redemption proceeds by the Trust, the Company and the Trust shall
not net purchases and redemptions. The trust will send one wire for all
redemptions and the company will transmit one payment for all purchases
for all Funds in accordance with Section 1.8.
1.8. The Trust, Underwriter and Company agree that all amounts available
under the Contracts shall be invested in the Funds, in such other Funds
managed by Xxxxx Fargo Bank as may be mutually agreed to in writing by
the parties hereto, in the Company's general account, or in investment
companies other than the Trust.
1.9. In the event of net purchase, the Company shall pay for shares in
federal funds initiated by wire no later than end of business New York
Time on the next Business Day after an order to purchase the Shares is
deemed to be received in accordance with the provisions of Section 1.1
hereof as long as the banking system is open for business. If the
banking system is closed, payment will be initiated the next day that
the banking system is open for business. If payment is not received by
Trust by the end of the Business Day, the Company shall, upon the
Trust's request, promptly reimburse the Trust for any charges, costs,
fees, interest or other expenses incurred in connection with advances,
borrowing or overdrafts. Interest will bear a rate per annum equal to
the Federal Funds Rate. For purposes of Section 2.4 and Section 2.11,
upon receipt by the Trust of the federal funds so wired, such funds
shall cease to be the responsibility of the Company and shall become
the responsibility of the Fund.
1.10. Issuance and transfer of the Trust's shares will be by book entry only.
Stock certificates will not be issued to the Company or any Separate
Account. Purchase and redemption orders for Trust shares will be
recorded in an appropriate title for each Separate Account or the
appropriate subaccount of each Separate Account.
1.11. The Trust shall furnish notice on or before ex-dividend date using a
mutually agreed upon format to the Company of any income, dividends, or
capital gain distributions payable on the Trust's shares. The Company
hereby elects to receive all such dividends and distributions as are
payable on the Fund shares in the form of additional shares of that
Fund. The Company reserves the right to revoke this election and to
receive all such
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1.11. dividends and distributions in cash. The Trust shall notify the Company
of the number of shares so issued as payment of such dividends and
distributions. Each year the Trust will provide the Company with a
dividend and capital gain payment schedule.
1.12. The Trust shall make the net asset value per share for each Fund
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 6:00 p.m. New York Time each Business Day. The Trust will notify the
Company when and if Trust does not communicate the net asset value per
share by 6:00 p.m. New York Time.
ARTICLE II Representations and Warranties
------------------------------
2.1. The Company represents and warrants that the Contracts are or will be
registered under the 1933 Act, unless exempt therefrom, and that the
Contracts will be issued and sold in compliance with all applicable
federal and state laws. The Company further represents and warrants
that: (i) it is an insurance company duly organized and validly
existing under applicable law; (ii) it has legally and validly
established each Separate Account as a segregated asset account under
applicable state law and has registered each Separate Account as a unit
investment trust in accordance with the provisions of the 1940 Act,
unless exempt therefrom, to serve as segregated investment accounts for
the Contracts; and (iii) it will maintain such registration, if
required, for so long as any Contracts are outstanding. The Company
shall amend any registration statement under the 1933 Act for the
Contracts and any registration statement under the 1940 Act for the
Separate Accounts 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 in accordance with the securities laws of the various states
only if, and to the extent, deemed necessary by the Company.
2.2. Subject to Article VI hereof, the Company represents that the Contracts
are currently and at the time of issuance will be treated as life
insurance, endowment, or annuity contracts under applicable provisions
of the Internal Revenue Code and that it will maintain such treatment
and that it will notify the Trust 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.
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2.3. The Company represents and warrants that all of its directors,
officers, employees, investment advisers, and other
individuals/entities dealing with the money and/or securities of the
Trust are covered by a blanket fidelity bond or similar coverage in an
amount not less than $5 million. The aforesaid includes coverage for
larceny and embezzlement and is issued by a reputable bonding company.
The Company agrees that any amounts received under such bond in
connection with claims that derive from arrangements described in this
Agreement will be held by the Company for the prorata benefit of the
Trust. The Company agrees to see that this bond or another bond
containing these provisions is always in effect, and agrees to notify
the Trust and the Underwriter in the event that such coverage no longer
applies.
2.4. The Trust represents and warrants that Trust shares sold pursuant to
this Agreement shall be registered under the 1933 Act and duly
authorized for issuance in accordance with applicable law, and that the
Trust is and shall remain registered under the 1940 Act for as long as
the Trust shares are sold. The Trust shall amend the registration
statement for its shares under the 1933 and the 1940 Acts from time to
time as required in order to effect the continuous offering of its
shares. The Trust shall register and qualify the shares for sale in
accordance with the laws of the various states only if, and to the
extent, deemed advisable by the Trust or the Underwriter.
2.5. The Trust and Underwriter represent and warrant that Trust is currently
qualified as a Regulated Investment Company under Subchapter M of the
Internal Revenue Code, and that Trust will make every effort to
maintain such qualification (under Subchapter M or any successor or
similar provision).
2.6. The Trust makes no representations as to whether any aspect of its
operations, including but not limited to, investment policies, fees and
expenses, complies with the insurance and other applicable laws of the
various states, except that the Trust represents that it is and shall
at all times remain in compliance with the laws of the state of
Delaware to the extent required to perform this Agreement.
2.7. The Trust represents and warrants that to the extent that it has
decided to finance distribution expenses pursuant to Rule 12b-1 under
the 1940 Act, and its Board of Trustees, a majority of whom are not
interested persons of the Trust, have approved a plan under Rule 12b-1
("Rule 12b-1 Plan") to finance distribution expenses.
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2.8. The Trust and Underwriter represent and warrant that the Trust is
lawfully organized and validly existing under the laws of Delaware and
that the Trust does and will comply with applicable provisions of the
0000 Xxx.
2.9. The Trust represents and warrants that it and all of its trustees,
officers, employees and other individuals/entities having access to the
funds and/or securities of the Trust are and continue to be at all
times covered by a blanket fidelity bond or similar coverage for the
benefit of the Trust in an amount not less than the minimal coverage as
required currently by Rule 17g-1 of the 1940 Act or related provisions
as may be promulgated from time to time. The aforesaid bond includes
coverage for larceny and embezzlement and is issued by a reputable
bonding company.
2.10. The Underwriter represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC.
The Underwriter further represents that it will sell and distribute the
Trust's shares in accordance with all applicable federal and state
securities laws, including without limitation the 1933 Act, the 1934
Act, and the 0000 Xxx.
2.11. The Underwriter represents and warrants that the Trust's investment
manager, Xxxxx Fargo Funds Management, LLC, is registered as an
investment adviser under all applicable federal and state securities
laws and that the investment manager will perform its obligations to
the Trust in accordance with any applicable state and federal
securities laws.
ARTICLE III Prospectuses and Proxy Statements; Voting
-----------------------------------------
3.1. The Underwriter shall provide the Company, at the Trust's expense, with
as many copies of the Trust's current prospectus as the Company may
reasonably request. If requested by the Company in lieu thereof, the
Trust shall provide such documentation including a final copy of a
current prospectus set in type at the Trust's expense and other
assistance as is reasonably necessary in order for the Company at least
annually (or more frequently if the Trust's prospectus is amended more
frequently) to have the new prospectus for the Contracts and the
Trust's new prospectus printed together in one document; in such case
at the Trust's expense.
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3.2. The Trust's prospectus shall state that the statement of additional
information for the Trust is available from the Underwriter (or, in the
Trust's discretion, the Prospectus shall state that such statement is
available from the Trust).
3.3. The Trust, at its expense, shall provide the Company with copies of its
proxy material, if any, reports to shareholders and other
communications to shareholders in such quantity as the Company shall
reasonably require and the Trust shall bear the costs of distributing
them to existing Contract owners or participants.
3.4. The Trust hereby notifies the Company that it is appropriate to include
in the prospectuses pursuant to which the Contracts are offered
disclosure regarding the potential risks of mixed and shared funding.
3.5. To the extent required by law the Company shall:
(1) solicit voting instructions from Contract owners
or participants;
(2) vote the Trust shares held in each Separate
Account in accordance with instructions received
from Contract owners or participants; and
(3) vote Trust shares held in each Separate Account
for which no timely instructions have been
received, in the same proportion as Trust shares
of such Fund for which instructions have been
received from the Company's Contract owners or
participants;
for so long as and to the extent that the 1940 Act requires
pass-through voting privileges for variable contract owners. The
Company reserves the right to vote Trust shares held in any segregated
asset account in its own right, to the extent permitted by law.
Participating Insurance Companies shall be responsible for assuring
that each of their separate accounts participating in the Trust
calculates voting privileges in a manner consistent with other
Participating Insurance Companies and as required by the Mixed and
Shared Funding Order. The Trust will notify the Company of any changes
of interpretation or amendment to the Mixed and Shared Funding Order.
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3.6. The Trust will comply with all provisions of the 1940 Act requiring
voting by shareholders, and in particular, the Trust will either
provide for annual meetings (except to the extent that the Commission
may interpret Section 16 of the 1940 Act not to require such meetings)
or comply with Section 16(c) of the 1940 Act (although the Trust is not
one of the trusts described in Section 16(c) of that Act) as well as
with Sections 16(a) and, if and when applicable, 16(b) of the 1940 Act.
Further, the Trust will act in accordance with the Commission's
interpretation of the requirements of Section 16(a) with respect to
periodic elections of Trustees and with whatever rules the Commission
may promulgate with respect thereto.
3.7. The Trust and the Underwriter agree to provide the Company all Trust
proxies, reports, and prospectuses (including supplements) in HTML, PDF
and hard copy in final form no later than 15 calendar days before they
must be mailed: Reports - February 13/th/ and August 14/th/,
Prospectuses - April 15/th/. The Trust will customize prospectuses
(including supplements), reports and proxies to include only fund(s)
offered in each of the contracts.
ARTICLE IV Sales Material and Information
------------------------------
4.1. The Company shall furnish, or shall cause to be furnished, to the Trust
or the Underwriter, each piece of sales literature or other promotional
material in which the Trust or the Trust's investment manager,
sub-advisers or Underwriter is named, at least five Business Days prior
to its use. No such material shall be used if the Trust or the
Underwriter reasonably objects in writing to such use within five
Business Days after receipt of such material.
4.2. The Company represents and agrees that sales literature for the
Contracts prepared by the Company or its affiliates will be consistent
with every law, rule, and regulation of any regulatory agency or
self-regulatory agency that applies to the Contracts or to the sale of
the Contracts, including, but not limited to, NASD Conduct Rule 2210
and IM-2210-2 thereunder.
4.3. The Company shall not give any information or make any representations
or statements on behalf of the Trust or concerning the Trust in
connection with the sale of the Contracts other than the information or
representations contained in the registration statement or prospectus
for the Trust shares as such registration statement and prospectus may
be
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amended or supplemented from time to time, or in reports or proxy
statements for the Trust, or in sales literature or other promotional
material approved by the Trust or by the Underwriter, except with the
permission of the Trust or the Underwriter. The Trust and the
Underwriter agree to respond to any request for approval on a prompt
and timely basis. The Company shall adopt and implement procedures
reasonably designed to ensure that information concerning the Trust,
the Underwriter, or any of their affiliates which is intended for use
by brokers or agents selling the Contracts (i.e., information that is
not intended for distribution to Contract owners or prospective
Contract owners) is so used, and neither the Trust, the Underwriter,
nor any of their affiliates shall be liable for any losses, damages,
or expenses relating to the improper use of such broker only materials
by agents of the Company or its affiliates who are unaffiliated with
the Trust or the Underwriter. The parties hereto agree that this
Section 4.3 is not intended to designate nor otherwise imply that the
Company is an underwriter or distributor of the Trust's shares.
4.4. The Trust or the Underwriter shall furnish, or shall cause to be
furnished, to the Company or its designee, each piece of sales
literature or other promotional material in which the Company, its
Separate Account, or the Contracts are named, at least five Business
Days prior to its use. No such material shall be used if the Company
reasonably objects in writing to such use within five Business Days
after receipt of such material.
4.5. The Trust represents and agrees that sales literature for the Trust
prepared by the Trust or its affiliates in connection with the sale of
the Contracts will be consistent with every law, rule, and Regulation
of any regulatory agency or self regulatory agency that applies to the
Trust or to the sale of Trust shares, including, but not limited to,
NASD Conduct Rule 2210 and IM-2210-2 thereunder.
4.6. The Trust and the Underwriter shall not give any information or make
any representations on behalf of the Company or concerning the Company,
each Separate Account, or the Contracts other than the information or
representations contained in a registration statement or prospectus for
the Contracts, as such registration statement and prospectus may be
amended or supplemented from time to time, or in published reports for
each Separate Account which are in the public domain or approved by the
Company for distribution to Contract owners or participants, or in
sales literature or other
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promotional material approved by the Company, except with the
permission of the Company. The Company agrees to respond to any request
for approval on a prompt and timely basis. The Trust and the
Underwriter shall xxxx information produced by or on behalf of the
Trust "FOR BROKER USE ONLY" if it is intended for use only by brokers
or agents selling the Contracts (i.e., information that is not intended
for distribution to Contract owners or prospective Contract owners)`,
and neither the Company nor any of its affiliates shall be liable for
any losses, damages, or expenses arising on account of the use by
brokers of such information with third parties in the event that is not
so marked.
4.7. The Trust will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional
information, reports, proxy statements, sales literature and other
promotional materials, applications for exemptions, requests for
no-action letters, and all amendments to any of the above, that relate
to the Trust or its shares, within 20 Business Days of the filing of
such document with the SEC or other regulatory authorities. The Trust
or Underwriter shall promptly inform the Company of the results of any
examination by the SEC (or other regulatory authorities) that relates
to the Trust, and the Trust or Underwriter shall provide the Company
with a copy of relevant portions of any "deficiency letter" or other
correspondence or written report regarding any such examination.
4.8. The Company will provide to the Trust at least one complete copy of all
registration statements, prospectuses, statements of additional
information, reports, solicitations for voting instructions, sales
literature and other promotional materials, applications for
exemptions, requests for no action letters, and all amendments to any
of the above, that relate to the Trust within 20 Business Days of the
filing of such document with the SEC or other regulatory authorities.
The Company shall promptly inform the Trust of the results of any
examination by the SEC (or other regulatory authorities) that relates
to the Contracts and their investment in the Trust, and the Company
shall provide the Trust with a copy of relevant portions of any
"deficiency letter" or other correspondence or written report regarding
any such examination.
4.9. For purposes of this Article IV, the phrase "sales literature or other
promotional material" includes, but is not limited to, advertisements
(such as material published, or designed for
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use in, a newspaper, magazine, or other periodical, radio, television,
telephone or tape recording, videotape display, signs or billboards,
motion pictures, or other public media), sales literature (i.e., any
written communication distributed or made generally available to
customers or the public, including brochures, circulars, research
reports, market letters, form letters, seminar texts, reprints or
excerpts of any other advertisement, sales literature, or published
article), educational or training materials or other communications
distributed or made generally available to some or all agents or
employees, registration statements, prospectuses, statements of
additional information, shareholder reports, and proxy materials and
any other material constituting sales literature or advertising under
NASD Conduct Rules, the 1940 Act or the 1933 Act.
4.10. Trust or Underwriter will provide a signed compliance report, as
reasonably requested by Company or its designee, on a quarterly basis
to include but not limited to: 817(h), subchapter M, and Prospectus
guidelines Trust or Underwriter will provide fund statistics and
commentaries (as reasonably required by Company) in electronic format
each calendar quarter, no later than the 15th of the month following
quarter-end.
ARTICLE V Fees and Expenses
-----------------
5.1. The Trust and Underwriter shall pay no fee or other compensation to the
Company under this Agreement, except subject a Rule 12b-1 Plan to
finance distribution expenses, in which case, subject to obtaining any
required exemptive orders or other regulatory approvals, the
Underwriter may make payments to the Company or to the underwriter for
the Contracts if and in amounts agreed to by the Underwriter in
writing. Each party, however, shall, in accordance with the allocation
of expenses specified in this Agreement, reimburse other parties for
expenses initially paid by one party but allocated to another party. In
addition, nothing herein shall prevent the parties hereto from
otherwise agreeing to perform, and arranging for appropriate
compensation for, other services relating to the Trust and/or to the
Separate Accounts.
4.9 All expenses incident to performance by the Trust of this Agreement
shall be paid by the Trust to the extent permitted by law. All Trust
shares will be duly authorized for issuance and registered in
accordance with applicable federal law and to the extent deemed
advisable by the Trust, in accordance with applicable state law, prior
to sale. The
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Trust shall bear the expenses for the cost of registration and
qualification of the Trust's shares, preparation and filing of the
Trust's prospectus and registration statement, Trust proxy materials
and reports, printing and mailing of Trust prospectuses (including
supplements thereto), proxy materials and reports for existing Contract
owners, setting in type the Trust's prospectuses, the preparation of
all statements and notices required by any federal or state law, all
taxes on the issuance or transfer of the Trust's shares, and any
expenses permitted to be paid or assumed by the Trust pursuant to any
Rule 12b-1 Plan under the 1940 Act duly adopted by the Trust.
5.3. The Company shall bear the expenses of printing and distributing the
Trust prospectuses and proxy statements and shareholder reports used in
connection with new sales. The Company shall bear all expenses
associated with the registration, qualification, and filing of the
Contracts under applicable federal securities and state insurance laws;
the cost of preparing, printing, and distributing the Contracts'
prospectuses and statements of additional information; and the cost of
printing and distributing annual individual account statements for
Contract owners as required by state insurance laws.
ARTICLE VI Diversification
---------------
6.1. The Trust and Underwriter represent and warrant that, at all times, the
Funds will comply with Section 817 of the Code and all regulations
thereof, relating to the diversification requirements for variable
annuity, endowment, or life insurance contracts and any amendments or
other modifications to such Section or Regulations. In the event a Fund
ceases to so qualify, the Trust will take all reasonable steps (a) to
notify Lincoln immediately of such event and (b) to adequately
diversify the Fund so as to achieve compliance with the grace period
afforded by Treasury Regulation 1.817-5.
ARTICLE VII Potential Conflicts
-------------------
7.1. If and to the extent that the Trust engages in mixed and shared funding
as contemplated by exemptive relief provided by the SEC and applicable
to the Trust, this Article VII shall apply.
7.2. The Board of Trustees of the Trust (the "Trust Board") will monitor the
Trust for the existence of any material irreconcilable conflict among
the interests of the Contract owners of all separate accounts investing
in the Trust. A material irreconcilable conflict
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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
Fund are being managed; (e) a difference in voting instructions given
by variable annuity contract owners, variable life insurance contract
owners, and trustees of qualified pension or retirement plans; (f) a
decision by a Participating Insurance Company to disregard the voting
instructions of Contract owners; or (g) if applicable, a decision by a
qualified pension or retirement plan to disregard the voting
instructions of plan participants. The Trust Board shall promptly
inform the Company if it determines that a material irreconcilable
conflict exists and the implications thereof. A majority of the Trust
Board shall consist of Trustees who are not "interested persons" of the
Trust.
7.3. The Company has reviewed a copy of the Mixed and Shared Funding Order,
and in particular, has reviewed the conditions to the requested relief
set forth therein. The Company agrees to assist the Trust Board in
carrying out its responsibilities under the Mixed and Shared Funding
Order, by providing the Trust Board with all information reasonably
requested by the Trust Board to consider any issues raised. This
includes, but is not limited to, an obligation by the Company to inform
the Trust Board whenever Contract owner voting instructions are
disregarded. The Trust Board shall record in its minutes or other
appropriate records, all reports received by it and all action with
regard to a conflict.
7.4. If it is determined by a majority of the Trust Board, or a majority of
its disinterested Trustees, that a material irreconcilable conflict
exists, the Company shall, at its expense and to the extent reasonably
practicable (as determined by a majority of the disinterested
Trustees), take whatever steps are necessary to remedy or eliminate the
material irreconcilable conflict, which may include: (a) withdrawing
the assets allocable to some or all of the Separate Accounts from the
relevant Fund and reinvesting such assets in a different investment
medium, including another Fund, or in the case of insurance company
participants submitting the question as to whether such segregation
should be
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implemented by a vote of all affected Contract owners and, as
appropriate, segregating the assets of any appropriate group (i.e.,
annuity Contract owners or life insurance 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; or (b) establishing a new registered management
investment company or managed separate account.
7.5. If the Company's disregard of voting instructions could conflict with
the majority of Contract owner voting instructions, and the Company's
judgment represents a minority position or would preclude a majority
vote, the Company may be required, at the Trust's election, to withdraw
the Separate Account's investment in the Trust and terminate this
Agreement with respect to such Separate Account, and no charge or
penalty will be imposed as a result of such withdrawal. Any such
withdrawal and termination shall take place within three (3) months, or
longer if there is pending SEC approval of a Substitution Order to
effect the withdrawal, after written notice is given that this
provision is being implemented, subject to applicable law but in any
event consistent with the terms of the Mixed and Shared Funding Order.
Until such withdrawal and termination is implemented, the Underwriter
and the Trust shall continue to accept and implement orders by the
Company for the purchase and redemption of shares of the Trust. Such
withdrawal and termination shall be limited to the extent required by
the foregoing material irreconcilable conflict as determined by a
majority of disinterested Trustees.
7.6. If a particular state insurance regulator's decision applicable to the
Company conflicts with the majority of other state insurance
regulators, then the Company will withdraw the Separate Account's
investment in the Trust and terminate this Agreement with respect to
such Separate Account within three months, or longer if there is
pending SEC approval of a Substitution Order to effect the withdrawal
after the Trust informs the Company of a material irreconcilable
conflict, subject to applicable law but in any event consistent with
the terms of the Mixed and Shared Funding Order. Until such withdrawal
and termination is implemented, the Underwriter and the Trust shall
continue to accept and implement orders by the Company for the purchase
and redemption of shares of the Trust. Such withdrawal and termination
shall be limited to the extent required by the
16
foregoing material irreconcilable conflict as determined by a majority
of disinterested Trustees.
7.7. For purposes of Sections 7.3 through 7.6 of this Agreement, a majority
of the disinterested members of the Trust Board shall determine whether
any proposed action adequately remedies any material irreconcilable
conflict, but in no event will the Trust or the Underwriter be required
to establish a new funding medium for the Contracts. The Company shall
not be required by Section 7.3 to establish a new funding medium for
the Contracts.
7.8. The Trust Board's determination of the existence of a material
irreconcilable conflict and its implication will be made known in
writing to the Company.
7.9. The Company shall at least annually submit to the Trust Board such
reports, materials, or data as the Trust Board may reasonably request
so that the Trustees may fully carry out the duties imposed upon the
Trust Board by the Mixed and Shared Funding Order, and said reports,
materials and data shall be submitted more frequently if deemed
appropriate by the Trust Board.
7.10. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or
Rule 6e-3(T) 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 Mixed and Shared Funding
Order) on terms and conditions materially different from those
contained in the Mixed and Shared Funding Order, the Trust and/or the
Company, as appropriate, shall take such steps as may be necessary 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.
ARTICLE VIII Indemnification
---------------
8.1. Indemnification By The Company
------------------------------
(a) The Company agrees to indemnify and hold harmless the Trust, the
Underwriter, and each of the Trust's or the Underwriter's directors,
officers, employees, or agents and each person, if any, who controls
the Trust or the Underwriter within the meaning of such terms under the
federal securities laws (collectively, the "indemnified parties" for
purposes of this Section 8.1) against any and all losses, claims,
damages, liabilities (including amounts paid in settlement with the
written consent of the
17
Company), or litigation (including reasonable legal and other
expenses), to which the indemnified parties may become subject under
any statute, regulation, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect
thereof) or settlements are related to the sale or acquisition of the
Trust's shares or the Contracts and:
(i) arise out of or are based upon any untrue statements
or alleged untrue statements of any material fact
contained in the registration statements,
prospectuses or statements of additional information
for the Contracts or contained in the Contracts, or
sales literature or other promotional material for
the Contracts (or any amendment or supplement to any
of the foregoing), 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 in light of the circumstances in
which they were made; provided that this agreement
to indemnify 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
in conformity with information furnished to the
Company by or on behalf of the Trust for use in the
registration statement, prospectus or statement of
information for the Contracts, or in the Contracts
or sales literature (or any amendment or supplement)
or otherwise for use in connection with the sale of
the Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations by or on behalf of the Company
(other than statements or representations contained
in the Trust registration statement, Trust
prospectus or sales literature or other promotional
material of the Trust not supplied by the Company or
persons under its control) or wrongful conduct of
the Company or persons under its control, with
respect to the sale or distribution of the Contracts
or Trust shares; or
18
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in the
Trust's registration statement, prospectus,
statement of additional information, or sales
literature or other promotional material of the
Trust or any amendment thereof, or supplement
thereto 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 in light of the circumstances in
which they were made, if such a statement or
omission was made in reliance upon and in conformity
with information furnished to the Trust by or on
behalf of the Company or persons under its control;
or
(iv) arise as a result of any failure by the Company to
provide the services and furnish the materials or to
make any payments under the terms of this Agreement;
or
(v) arise out of 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 by the Company of this
Agreement;
except to the extent provided in Sections 8.1(b) and 8.4 hereof. This
indemnification shall be in addition to any liability which the Company
may otherwise have.
(b) No party shall be entitled to indemnification by the
Company if such loss, claim, damage, liability or litigation is due to
the willful misfeasance, bad faith, gross negligence, or reckless
disregard of duty by the party seeking indemnification.
(c) The indemnified parties will promptly notify the
Company of the commencement of any litigation or proceedings against
them in connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
8.2. Indemnification By the Underwriter
----------------------------------
19
(a) The Underwriter agrees to indemnify and hold
harmless the Company and each of its directors, officers, employees, or
agents and each person, if any, who controls the Company within the
meaning of such terms under the federal securities laws (collectively,
the "indemnified parties" for purposes of this Section 8.2) against any
and all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Underwriter), or litigation
(including reasonable legal and other expenses) to which the
indemnified parties may become subject under any statute, regulation,
at common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements
are related to the sale or acquisition of the Trust's shares or the
Contracts and:
(i) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact
contained in the registration statement, prospectus,
or statement of additional information for the
Trust, or sales literature or other promotional
material of the Trust (or any amendment or
supplement to any of the foregoing), 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 in light of the
circumstances in which they were made; provided that
this agreement to indemnify 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 in conformity with information
furnished to the Underwriter or the Trust by or on
behalf of the Company for use in the registration
statement, prospectus, or statement of additional
information for the Trust or in sales literature of
the Trust (or any amendment or supplement thereto)
or otherwise for use in connection with the sale of
the Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or
representations contained in the Contracts or in
20
the Contract or Trust registration statement, the
Contract or Trust prospectus, statement of
additional information, or sales literature or other
promotional material for the Contracts or of the
Trust not supplied by the Underwriter or persons
under the control of the Underwriter) or wrongful
conduct of the Underwriter or persons under the
control of the Underwriter, with respect to the sale
or distribution of the Contracts or Trust shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, prospectus, statement of
additional information, or sales literature or other
promotional material covering the Contracts (or any
amendment thereof or supplement thereto), or the
omission or alleged omission to state therein a
material fact required to be stated therein or
necessary to make the statement or statements
therein not misleading in light of the circumstances
in which they were made, if such statement or
omission was made in reliance upon and in conformity
with information furnished to the Company by or on
behalf of the Underwriter or persons under the
control of the Underwriter; or
(iv) arise as a result of any failure by the Underwriter
to provide the services and furnish the materials
under the terms of this Agreement (including a
failure, whether unintentional or in good faith or
otherwise, to comply with the diversification
requirements and procedures related thereto
specified in Article VI of this Agreement); or
(v) arise out of or result from any material breach of
any representation and/or warranty made by the
Underwriter in this
21
Agreement or arise out of or result from any other
material breach of this Agreement by the
Underwriter;
except to the extent provided in Sections 8.2(b) and 8.4 hereof. This
indemnification shall be in addition to any liability which the
Underwriter may otherwise have.
(b) No party shall be entitled to indemnification by the
Underwriter if such loss, claim, damage, liability or litigation is due
to the willful misfeasance, bad faith, gross negligence, or reckless
disregard of duty by the party seeking indemnification.
(c) The indemnified parties will promptly notify the
Underwriter of the commencement of any litigation or proceedings
against them in connection with the issuance or sale of the Contracts
or the operation of each Separate Account.
8.3. Indemnification By the Trust
----------------------------
(a) The Trust agrees to indemnify and hold harmless
the Company and each of its directors, officers, employees, or agents
and each person, if any, who controls the Company within the meaning of
such terms under the federal securities laws (collectively, the
"indemnified parties" for purposes of this Section 8.3) against any and
all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Trust), or litigation
(including reasonable legal and other expenses) to which the
indemnified parties may become subject under any statute, regulation,
at common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements
are related to the operations of the Trust and:
(i) arise as a result of any failure by the Trust to
provide the services and furnish the materials under
the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise,
to comply with the diversification requirements and
procedures related thereto specified in Article VI
of this Agreement); or
(ii) arise out of or result from any material breach of
any representation and/or warranty made by the Trust
in this
22
Agreement or arise out of or result from any other
material breach of this Agreement by the Trust;
except to the extent provided in Sections 8.3(b) and 8.4 hereof. This
indemnification shall be in addition to any liability which the Trust
may otherwise have.
(b) No party shall be entitled to indemnification by
the Trust if such loss, claim, damage, liability or litigation is due
to the willful misfeasance, bad faith, gross negligence, or reckless
disregard of duty by the party seeking indemnification.
(c) The indemnified parties will promptly notify the
Trust of the commencement of any litigation or proceedings against it
in connection with the issuance or sale of the Contracts or the
operation of each Separate Account.
8.4. Indemnification Procedure
-------------------------
Any person obligated to provide indemnification under this Article VIII
("indemnifying party" for the purpose of this Section 8.4) shall not be
liable under the indemnification provisions of this Article VIII with
respect to any claim made against a party entitled to indemnification
under this Article VIII ("indemnified party" for the purpose of this
Section 8.4) unless such indemnified party shall have notified the
indemnifying party in writing within a reasonable time after the
summons or other first legal process giving information of the nature
of the claim shall have been served upon such indemnified party (or
after such party shall have received notice of such service on any
designated agent), but failure to notify the indemnifying party of any
such claim shall not relieve the indemnifying party from any liability
which it may have to the indemnified party against whom such action is
brought under the indemnification provision of this Article VIII,
except to the extent that the failure to notify results in the failure
of actual notice to the indemnifying party and such indemnifying party
is damaged solely as a result of failure to give such notice. In case
any such action is brought against the indemnified party, the
indemnifying party will be entitled to participate, at its own expense,
in the defense thereof. The indemnifying party also shall be entitled
to assume the defense thereof, with consent of the indemnified party
and counsel satisfactory to the party named in the action. After notice
from the indemnifying party to the indemnified party of the
indemnifying party's election to assume the defense thereof, the
indemnified party shall
23
bear the fees and expenses of any additional counsel retained by it,
and the indemnifying party will not be liable to such 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, unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention
of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party
and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential
differing interests between them. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its
written consent but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify
the indemnified party from and against any loss or liability by reason
of such settlement or judgment.
A successor by law of the parties to this Agreement shall be
entitled to the benefits of the indemnification contained in this
Article VIII. The indemnification provisions contained in this Article
VIII shall survive any termination of this Agreement.
ARTICLE IX Applicable Law
--------------
9.1. This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Delaware without
giving effect to conflicts of laws provisions thereof.
9.2. This Agreement shall 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 (including, but not limited to, the Mixed and Shared
Funding Order) and the terms hereof shall be interpreted and construed
in accordance therewith.
ARTICLE X Termination
-----------
10.1. This Agreement shall terminate automatically in the event of its
assignment, unless made with written consent of each party; or:
(a) at the option of any party upon six months advance
written notice to the other parties; or
24
(b) at the option of the Company if shares of the Funds
delineated in Exhibit B are not reasonably available to meet the
requirements of the Contracts as determined by the Company; or
(c) at the option of the Trust upon institution of formal
proceedings against the Company by the NASD, the SEC, the insurance
commission of any state or any other regulatory body, which would have
a material adverse effect on the Company's ability to perform its
obligations under this Agreement; or
(d) at the option of the Company upon institution of
formal proceedings against the Trust or the Underwriter by the NASD,
the SEC, or any state securities or insurance department or any other
regulatory body, which would have a material adverse effect on the
Underwriter's or the Trust's ability to perform its obligations under
this Agreement; or
(e) at the option of the Company or the Trust upon a
determination by a majority of the Trust Board, or a majority of the
disinterested Trustees, that a material irreconcilable conflict exists
among the interests of (i) all contract owners of variable insurance
products of all separate accounts, or (ii) the interests of the
Participating Insurance Companies investing in the Trust as delineated
in Article VII of this Agreement; or
(f) at the option of the Company if the Trust ceases to
qualify as a Regulated Investment Company under Subchapter M of the
Internal Revenue Code, or under any successor or similar provision, or
if the Company reasonably believes that the Trust may fail to so
qualify; or
(g) at the option of the Company if the Trust fails to
meet the diversification requirements specified in Article VI hereof or
if the Company reasonably believes that the Trust will fail to meet
such requirements; or
(h) at the option of any party to this Agreement, upon
another party's material breach of any provision of this Agreement; or
(i) at the option of the Company, if the Company
determines in its sole judgment exercised in good faith, that either
the Trust or the Underwriter has suffered a material adverse change in
its business, operations, or financial condition since the date of this
Agreement or is the subject of material adverse publicity which is
likely
25
to have a material adverse impact upon the business and operations of
the Company or the Contracts (including the sale thereof); or
(j) at the option of the Trust or Underwriter, if the
Trust or Underwriter respectively, shall determine in its sole judgment
exercised in good faith, that the Company has suffered a material
adverse change in its business, operations, or financial condition
since the date of this Agreement or is the subject of material adverse
publicity which is likely to have a material adverse impact upon the
business and operations of the Trust or Underwriter; or
(k) subject to the Trust's compliance with Article VI
hereof, at the option of the Trust in the event any of the Contracts
are not issued or sold in accordance with applicable requirements of
federal and/or state law. Termination shall be effective immediately
upon such occurrence without notice.
10.2. Notice Requirement
------------------
(a) In the event that any termination of this Agreement
is based upon the provisions of Article VII, such prior written notice
shall be given in advance of the effective date of termination as
required by such provisions.
(b) In the event that any termination of this Agreement
is based upon the provisions of Sections 10.l(b) - (d) or 10.1(g) -
(i), prompt written notice of the election to terminate this Agreement
for cause shall be furnished by the party terminating the Agreement to
the non-terminating parties, with said termination to be effective upon
receipt of such notice by the non-terminating parties.
(c) In the event that any termination of this Agreement
is based upon the provisions of Sections 10.1(j) or 10. l(k), prior
written notice of the election to terminate this Agreement for cause
shall be furnished by the party terminating this Agreement to the
nonterminating parties. Such prior written notice shall be given by the
party terminating this Agreement to the non-terminating parties at
least 30 days before the effective date of termination.
10.3. It is understood and agreed that the right to terminate this Agreement
pursuant to Section 10.1(a) may be exercised for any reason or for no
reason.
10.4. Effect of Termination
----------------------
26
(a) Notwithstanding any termination of this Agreement
pursuant to Section 10.1 of this Agreement and subject to Section 1.3
of this Agreement, the Company may require the Trust and the
Underwriter to continue to make available additional shares of the
Trust for so long after the termination of this Agreement as the
Company desires pursuant to the terms and conditions of this Agreement
as provided in paragraph (b) below, for all Contracts in effect on the
effective date of termination of this Agreement (hereinafter referred
to as "Existing Contracts"). Specifically, without limitation, the
owners of the Existing Contracts shall be permitted to reallocate
investments in the Trust, redeem investments in the Trust and/or invest
in the Trust upon the making of additional purchase payments under the
Existing Contracts. The parties agree that this Section 10.4 shall not
apply to any terminations under Article VII and the effect of such
Article VII terminations shall be governed by Article VII of this
Agreement.
(b) If shares of the Trust continue to be made available
after termination of this Agreement pursuant to this Section 10.4, the
provisions of this Agreement shall remain in effect except for Section
10.l(a) and thereafter the Trust, the Underwriter, or the Company may
terminate the Agreement, as so continued pursuant to this Section 10.4,
upon written notice to the other party, such notice to be for a period
that is reasonable under the circumstances but need not be for more
than 90 days.
10.5. The Company shall not redeem Fund shares attributable to the Contracts
(as opposed to Fund shares attributable to the Company's assets held in
the Account) except (i) as necessary to implement Contract Owner
initiated or approved transactions, or (ii) as required by state and/or
federal laws or regulations or judicial or other legal precedent of
general application (hereinafter referred to as a "Legally Required
Redemption"). Upon request, the Company will promptly furnish to the
Trust and the Underwriter the opinion of counsel for the Company to the
effect that any redemption pursuant to clause (ii) above is a Legally
Required Redemption. Furthermore, except in cases where permitted under
the terms of the Contracts, the Company shall not prevent Contract
Owners from allocating payments to a Fund that was otherwise available
under the Contracts without first giving the Trust or the Underwriter
30 days notice of its intention to do so.
ARTICLE XI Notices
-------
27
Any notice shall be deemed duly given only if sent by hand, evidenced
by written receipt or by certified mail, return receipt requested, 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. All notices shall be deemed given three Business Days
after the date received or rejected by the addressee.
If to the Trust: Xxxxx Fargo Variable Trust
000 Xxxxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: C. Xxxxx Xxxxxxx, Secretary
If to the Company: The Lincoln National Life Insurance
Company
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx, Second
Vice President
If to the Underwriter: Xxxxxxxx Inc.
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Vice
President
ARTICLE XII Miscellaneous
-------------
12.1. All persons dealing with the Trust must look solely to the property of
the Trust for the enforcement of any claims against the Trust as
neither the Trustees, officers, agents or shareholders assume any
personal liability for obligations entered into on behalf of the Trust.
12.2. Subject to law and regulatory authority, each party hereto shall treat
as confidential all information reasonably identified as such in
writing by any other party hereto (including without limitation the
names and addresses of the owners of the Contracts) and, except as
contemplated by this Agreement, shall not disclose, disseminate, or
utilize such confidential information until such time as it may come
into the public domain without the express prior written consent of the
affected party.
12.3. 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.
28
12.4. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the
same instrument.
12.5. 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.
12.6. This Agreement shall not be assigned by any party hereto without the
prior written consent of all the parties.
12.7. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
SEC, the NASD, and state insurance regulators) and shall permit each
other and 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.
12.8. Each party represents that the execution and delivery of this Agreement
and the consummation of the transactions contemplated herein have been
duly authorized by all necessary corporate or trust action, as
applicable, by such party and when so executed and delivered this
Agreement will be the valid and binding obligation of such party
enforceable in accordance with its terms.
12.9. The parties to this Agreement may amend the schedules to this Agreement
from time to time to reflect changes in or relating to the Contracts,
the Separate Accounts or the Funds of the Trust.
12.10. The Trust has filed a Certificate of Trust with the Secretary of State
of The State of Delaware. The Company acknowledges that the obligations
of or arising out of the Trust's Declaration of Trust are not binding
upon any of the Trust's Trustees, officers, employees, agents or
shareholders individually, but are binding solely upon the assets and
property of the Trust in accordance with its proportionate interest
hereunder. The Company further acknowledges that the assets and
liabilities of each Fund are separate and distinct and that the
obligations of or arising out of this instrument are binding solely
upon the assets or property of the Fund on whose behalf the Trust has
executed this instrument. The Company also agrees that the obligations
of each Fund hereunder shall be several and not joint, in accordance
with its proportionate interest hereunder, and the Company agrees not
to proceed against any Fund for the obligations of another Fund.
29
12.11. Except as otherwise expressly provided in this Agreement, neither the
Trust nor the underwriter nor any affiliate thereof shall use any
trademark, trade name, service xxxx or logo of the Company or any of
its affiliates, or any variation of any such trademark, trade name
service xxxx or logo, without the Company's prior consent, the granting
of which shall be at the Company's sole option. Except as otherwise
expressly provided in this Agreement, neither the Company nor any
affiliate thereof shall use any trademark, trade name, service xxxx or
logo of the Trust or of the Underwriter, or any variation of any such
trademark, trade name, service xxxx or logo, without the prior consent
of either the Trust or of the Underwriter, as appropriate, the granting
of which shall be at the sole option of the Trust or of the
Underwriter, as applicable.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
Xxxxx Fargo Variable Trust
By: /s/ C. Xxxxx Xxxxxxx
----------------------------
Name: C. Xxxxx Xxxxxxx
Title: Secretary
The Lincoln National Life Insurance Company
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Second Vice President
Xxxxxxxx Inc.
By: /s/ Xxxxxxx X. Xxxxx
----------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
30
EXHIBIT A
Separate Accounts and Contracts
Subject to the Participation Agreement
--------------------------------------
Separate Account(s):
--------------------
Lincoln Life Variable Annuity Account W
Contracts:
----------
Xxxxx Fargo New Directions Core
Xxxxx Fargo New Directions Access
Xxxxx Fargo New Directions Access 4
31
EXHIBIT B
Funds Subject to the Participation Agreement
--------------------------------------------
Xxxxx Fargo Asset Allocation
Xxxxx Fargo Corporate Bond
Xxxxx Fargo Equity Value
Xxxxx Fargo Equity Income
Xxxxx Fargo Growth Xxxxx
Fargo International Equity
Xxxxx Fargo Large Company Growth
Xxxxx Fargo Money Market
Xxxxx Fargo Small Cap Growth
32
