PARTICIPATION AGREEMENT
as of May 1, 2000
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
CONTENTS
SECTION SUBJECT MATTER
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1. Parties and Purpose
2. Representations and Warranties
3. Purchase and Redemption of Trust Portfolio Shares
4. Fees, Expenses, Prospectuses, Proxy Materials and Reports
5. Voting
6. Sales Material, Information and Trademarks
7. Indemnification
8. Notices
9. Termination
10. Miscellaneous
SCHEDULES TO THIS AGREEMENT
A. The Company
B. Accounts of the Company
C. Available Portfolios and Classes of Shares of the Trust;
Investment Advisers
D. Contracts of the Company
E. Other Portfolios Available under the Contracts
F. Rule 12b-1 Plans of the Trust
G. Addresses for Notices
H. Shared Funding Order
1. PARTIES AND PURPOSE
This agreement (the "Agreement") is between certain portfolios,
specified below and in Schedule C, of Franklin Xxxxxxxxx Variable Insurance
Products Trust, an open-end management investment company organized as a
business trust under Massachusetts law (the "Trust"), Franklin Xxxxxxxxx
Distributors, Inc., a California corporation which is the principal underwriter
for the Trust (the "Underwriter," and together with the Trust, "we" or "us") and
the insurance company identified on Schedule a ("you"), on your own behalf and
on behalf of each segregated asset account maintained by you that is listed on
Schedule B, as that schedule may be amended from time to time ("Account" or
"Accounts").
The purpose of this Agreement is to entitle you, on behalf of the
Accounts, to purchase the shares, and classes of shares, of portfolios of the
Trust ("Portfolios") that are identified on Schedule C, solely for the purpose
of funding benefits of your variable life insurance policies or variable annuity
contracts ("Contracts") that are identified on Schedule D. This Agreement does
not authorize any other purchases or redemptions of shares of the Trust.
2. REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES BY YOU
You represent and warrant that:
2.1.1 redacted
2.1.2 All of your directors, officers, employees, and other
individuals or entities dealing with the money and/or securities of the Trust
are and shall be at all times covered by a blanket fidelity bond or similar
coverage, in an amount not less than $5 million. Such bond shall include
coverage for larceny and embezzlement and shall be issued by a reputable bonding
company. You agree to make all reasonable efforts to see that this bond or
another bond containing such provisions is always in effect, and you agree to
notify us in the event that such coverage no longer applies.
2.1.3 Each Account is a duly organized, validly existing
segregated asset account under applicable insurance law and 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
Internal Revenue Code of 1986, as amended ("Code") and the regulations
thereunder. You will use your best efforts to continue to meet such definitional
requirements, and will notify us 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.
2.1.4 Each Account either: (i) has been registered or, prior
to any issuance or sale of the Contracts, will be registered as a unit
investment trust under the Investment Company Act of 1940 ("1940 Act"); or (ii)
has not been so registered in proper reliance upon an exemption from
registration under Section 3(c) of the 1940 Act; if the Account is exempt from
registration as an investment company under Section 3(c) of the 1940 Act, you
will use your best efforts to maintain such exemption and will notify us
immediately upon having a reasonable basis for believing that such exemption no
longer applies or might not apply in the future.
2.1.5 The Contracts or interests in the Accounts: (i) are or,
prior to any issuance or sale will be, registered as securities under the
Securities Act of 1933, as amended (the "1933 Act"); or (ii) are not registered
because they are properly exempt from registration under Section 3(a)(2) of the
1933 Act or will be offered exclusively in transactions that are properly exempt
from registration under Section 4(2) or Regulation D of the 1933 Act, in which
case you will make every effort to maintain such exemption and will notify us
immediately upon having a reasonable basis for believing that such exemption no
longer applies or might not apply in the future.
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2.1.6 redacted
2.1.7 The Contracts currently are treated as annuity contracts
or life insurance contracts under applicable provisions of the Code and you will
use your best efforts to maintain such treatment; you will notify us immediately
upon having a reasonable basis for believing that any of the Contracts have
ceased to be so treated or that they might not be so treated in the future.
2.1.8 The fees and charges deducted under each Contract, in
the aggregate, are reasonable in relation to the services rendered, the expenses
expected to be incurred, and the risks assumed by you.
2.1.9 You will use shares of the Trust only for the purpose of
funding benefits of the Contracts through the Accounts.
2.1.10 redacted
2.1.11 With respect to any Accounts which are exempt from
registration under the 1940 Act in reliance on 3(c)(1) or
Section 3(c)(7) thereof:
2.1.11.1 the principal underwriter for each
such Account and any subaccounts
thereof is a registered broker-dealer
with the SEC under the 1934 Act;
2.1.11.2 the shares of the Portfolios of the Trust
are and will continue to be the only
investment securities held by the
corresponding subaccounts; and
2.1.11.3 with regard to each Portfolio, you, on
behalf of the corresponding subaccount,
will:
(a) vote such shares held by it in the
same proportion as the vote of all
other holders of such shares; and
(b) refrain from substituting shares of
another security for such shares
unless the SEC has approved such
substitution in the manner provided
in Section 26 of the 0000 Xxx.
2.1.12 You and the principal underwriter for each of the
Contracts will comply in all material respects with the 1933 and 1940 Acts and
the rules and regulations thereunder.
2.2 REPRESENTATIONS AND WARRANTIES BY THE TRUST
The Trust represents and warrants that:
2.2.1 It is duly organized and in good standing under the
laws of the State of Massachusetts.
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2.2.2 All of its directors, officers, employees and others
dealing with the money and/or securities of a Portfolio, that are so required by
Rule 17g-1 under the 1940 Act, are and shall be at all times covered by a
blanket fidelity bond or similar coverage in an amount not less that the minimum
coverage required by Rule 17g-1 or other regulations under the 1940 Act. Such
bond shall include coverage for larceny and embezzlement and be issued by a
reputable bonding company.
2.2.3 It is registered as an open-end management investment
company under the 0000 Xxx.
2.2.4 Each class of shares of the Portfolios of the Trust
is registered under the 0000 Xxx.
2.2.5 redacted
2.2.6 redacted
2.2.7 redacted
2.2.8 redacted
2.2.9 It currently intends for one or more classes of shares
(each, a "Class") to make payments to finance its distribution expenses,
including service fees, pursuant to a plan ("Plan") adopted under rule 12b-1
under the 1940 Act ("Rule 12b-1"), although it may determine to discontinue such
practice in the future.
2.3 REPRESENTATIONS AND WARRANTIES BY THE UNDERWRITER
The Underwriter represents and warrants that:
2.3.1 It is registered as a broker dealer with the SEC under
the 1934 Act, and is a member in good standing of
the NASD.
2.3.2 Each investment adviser listed on Schedule C (each, an
"Adviser") is duly registered as an investment adviser under the Investment
Advisers Act of 1940, as amended, and any applicable state securities law.
2.3.3 All of its directors, officers, employees and others
dealing with the money and/or securities of a Portfolio, that are so required by
Rule 17g-1 under the 1940 Act, are and shall be at all times covered by a
blanket fidelity bond or similar coverage in an amount not less that the minimum
coverage required by Rule 17g-1 or other regulations under the 1940 Act. Such
bond shall include coverage for larceny and embezzlement and be issued by a
reputable bonding company. redacted
2.3.4 It will comply in all material respects with the
1933 and 1940 Acts and the rules and regulations
thereunder.
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2.3.5 redacted
2.3.6 redacted
2.4 WARRANTY AND AGREEMENT BY BOTH YOU AND US
We received an order from the SEC dated November 16, 1993 (file
no. 812-8546), which was amended by a notice and an order we received on
September 17, 1999 and October 13, 1999, respectively (file no. 812-11698)
(collectively, the "Shared Funding Order," attached to this Agreement as
Schedule H). The Shared Funding Order grants exemptions from certain provisions
of the 1940 Act and the regulations thereunder to the extent necessary to
permit shares of the Trust to be sold to and held by variable annuity and
variable life insurance separate accounts of both affiliated and unaffiliated
life insurance companies and qualified pension and retirement plans outside the
separate account context. You and we both warrant and agree that both you and
we will comply with the "Applicants' Conditions" prescribed in the Shared
Funding Order as though such conditions were set forth verbatim in this
Agreement, including, without limitation, the provisions regarding potential
conflicts of interest between the separate accounts which invest in the Trust
and regarding contract owner voting privileges. In order for the Trust's Board
of Trustees to perform its duty to monitor for conflicts of interest, you agree
to inform us of the occurrence of any of the events specified in condition 2 of
the Shared Funding Order to the extent that such event may or does result in a
material conflict of interest as defined in that order.
3. PURCHASE AND REDEMPTION OF TRUST PORTFOLIO SHARES
3.1 We will make shares of the Portfolios available to the Accounts
for the benefit of the Contracts. The shares will be available for purchase at
the net asset value per share next computed after we (or our agent) receive a
purchase order, as established in accordance with the provisions of the then
current prospectus of the Trust. For purposes of this Section 3, you shall be
the Trust's agent or designee for receipt of purchase orders and requests for
redemption. Notwithstanding the foregoing, the Trust's Board of Trustees
("Trustees") may refuse to sell shares of any Portfolio to any person, or may
suspend or terminate the offering of shares of any Portfolio if such action is
required by law or by regulatory authorities having jurisdiction or if, in the
sole discretion of the Trustees, they deem such action to be in the best
interests of the shareholders of such Portfolio. Without limiting the foregoing,
the Trustees have determined that there is a significant risk that the Trust and
its shareholders may be adversely affected by investors whose purchase and
redemption activity follows a market timing pattern, and have authorized the
Trust, the Underwriter and the Trust's transfer agent to adopt procedures and
take other action (including, without limitation, rejecting specific purchase
orders) as they deem necessary to reduce, discourage or eliminate market timing
activity. You agree to cooperate with us to the extent possible to assist us in
implementing the Trust's restrictions on purchase and redemption activity that
follows a market timing pattern.
3.2 We agree that shares of the Trust will be sold only to life
insurance companies which have entered into fund participation agreements with
the Trust ("Participating Insurance Companies") and their separate accounts or
to qualified pension and retirement plans in accordance
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with the terms of the Shared Funding Order. No shares of any Portfolio will
be sold to the general public.
3.3 redacted
3.4 redacted
3.5 We shall calculate the net asset value per share of each
Portfolio on each Business Day, and shall communicate these net asset values
to you or your designated agent on a daily basis after the calculation is
completed (normally by 6:30 p.m. New York time).
3.6 You shall submit payment for the purchase of shares of a
Portfolio on behalf of an Account no later than the close of business on the
next Business Day after we receive the purchase order. Payment shall be made in
federal funds transmitted by wire to the Trust or to its designated custodian.
3.7 redacted
3.8 Issuance and transfer of the Portfolio shares will be by book
entry only. Stock certificates will not be issued to you or the Accounts.
Portfolio shares purchased from the Trust will be recorded in the appropriate
title for each Account or the appropriate subaccount of each Account.
3.9 We shall furnish, on or before the ex-dividend date, notice to
you of any income dividends or capital gain distributions payable on the shares
of any Portfolio. You hereby elect to receive all such income dividends and
capital gain distributions as are payable on shares of a Portfolio in additional
shares of that Portfolio, and you reserve the right to change this election in
the future. We will notify you of the number of shares so issued as payment of
such dividends and distributions.
3.10 redacted
4. FEES, EXPENSES, PROSPECTUSES, PROXY MATERIALS AND REPORTS
4.1 We shall pay no fee or other compensation to you under this
Agreement except as provided on Schedule F, if attached.
4.2 We shall prepare and be responsible for filing with the SEC,
and any state 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 Trust. We shall bear the costs of preparation and filing of the
documents listed in the preceding sentence, registration and qualification
of the Trust's shares of the Portfolios.
4.3 redacted
4.4 redacted
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4.5 We shall provide you, at our expense, with copies of any
Trust-sponsored proxy materials in such quantity as you shall reasonably require
for distribution to Contract owners who are invested in a designated subaccount.
You shall bear the costs of distributing proxy materials (or similar materials
such as voting solicitation instructions) to Contract owners.
4.6 You assume sole responsibility for ensuring that the Trust's
prospectuses, shareholder reports and communications, and proxy materials are
delivered to Contract owners in accordance with applicable federal and state
securities laws.
5. VOTING
5.1 All Participating Insurance Companies shall have the obligations
and responsibilities regarding pass-through voting and conflicts of interest
corresponding to those contained in the Shared Funding Order.
5.2 If and to the extent required by law, you shall: (i) solicit
voting instructions from Contract owners; (ii) vote the Trust shares in
accordance with the instructions received from Contract owners; and (iii) vote
Trust shares for which no instructions have been received in the same proportion
as Trust shares of such Portfolio for which instructions have been received; so
long as and to the extent that the SEC continues to interpret the 1940 Act to
require pass-through voting privileges for variable contract owners. redacted
5.3 redacted
6. SALES MATERIAL, INFORMATION AND TRADEMARKS
6.1 For purposes of this Section 6, "Sales literature or other
Promotional material" includes, but is not limited to, portions of the following
that use any logo or other trademark related to the Trust, or Underwriter or its
affiliates, or refer to the Trust: advertisements (such as material published or
designed for use in a newspaper, magazine or other periodical, radio,
television, telephone or tape recording, videotape display, signs or billboards,
motion pictures, electronic communication 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 or
any other advertisement, sales literature or published article or electronic
communication), educational or training materials or other communications
distributed or made generally available to some or all agents or employees in
any media, and disclosure documents, shareholder reports and proxy materials.
6.2 redacted
6.3 redacted
6.4 You and your agents shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust,
the Underwriter or an Adviser, other than information or representations
contained in and accurately derived from the registration statement or
prospectus for the Trust shares (as such registration statement and prospectus
may be amended or
7
supplemented from time to time), annual and semi-annual reports of the Trust,
Trust-sponsored proxy statements, or in Sales literature or other Promotional
material approved by the Trust or its designee, except as required by legal
process or regulatory authorities or with the written permission of the Trust
or its designee.
6.5 We shall not give any information or make any representations
or statements on behalf of you or concerning you, the Accounts or the Contracts
other than information or representations contained in and accurately derived
from Disclosure Documents for the Contracts (as such Disclosure Documents may
be amended or supplemented from time to time), or in materials approved by you
for distribution, including Sales literature or other Promotional materials,
except as required by legal process or regulatory authorities or with your
written permission.
6.6 Except as provided in Section 6.2, you shall not use any
designation comprised in whole or part of the names or marks "Franklin" or
"Xxxxxxxxx" or any logo or other trademark relating to the Trust or the
Underwriter without prior written consent, and upon termination of this
Agreement for any reason, you shall cease all use of any such name or xxxx as
soon as reasonably practicable.
6.7 You shall furnish to us ten (10) Business Days prior to its
first submission to the SEC or its staff, any request or filing for no-action
assurance or exemptive relief naming, pertaining to, or affecting, the Trust,
the Underwriter or any of the Portfolios.
7. INDEMNIFICATION
7.1 INDEMNIFICATION BY YOU
7.1.1 You agree to indemnify and hold harmless the
Underwriter, the Trust and each of its Trustees, officers, employees and agents
and each person, if any, who controls the Trust within the meaning of Section 15
of the 1933 Act (collectively, the "Indemnified Parties" and individually the
"Indemnified Party" for purposes of this Section 7) against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with your
written consent, which consent shall not be unreasonably withheld) 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 are related to the sale or acquisition of
shares of the Trust or the Contracts and
7.1.1.1 arise out of or are based upon any untrue
statements or alleged untrue statements of any material fact contained
in a Disclosure Document for the Contracts or in the Contracts
themselves or in sales literature generated or approved by you 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 Section 7), 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
8
such alleged statement or omission was made in reliance upon and was
accurately derived from written information furnished to you by or on
behalf of the Trust for use in Company Documents or otherwise for use
in connection with the sale of the Contracts or Trust shares; or
7.1.1.2 arise out of or result from statements or
representations (other than statements or representations contained in
and accurately derived from Trust Documents as defined below in Section
7.2) or wrongful conduct of you or persons under your control, with
respect to the sale or acquisition of the Contracts or Trust shares; or
7.1.1.3 arise out of or result from any untrue
statement or alleged untrue statement of a material fact contained in
Trust Documents as defined below in Section 7.2 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 Trust by or on behalf
of you; or
7.1.1.4 arise out of or result from any failure by
you to provide the services or furnish the materials required under the
terms of this Agreement (including a failure, whether unintentional or
in good faith or otherwise, to have any Contract qualify as a "variable
contract" within the meaning of such term under Section 817 of the
Code, as amended, or any regulations thereunder);
7.1.1.5 arise out of or result from any material
breach of any representation and/or warranty made by you in this
Agreement or arise out of or result from any other material breach of
this Agreement by you; or
7.1.1.6 arise out of or result from a Contract
failing to be considered a life insurance policy or an annuity
Contract, whichever is appropriate, under applicable provisions of the
Code thereby depriving the Trust of its compliance with Section 817(h)
of the Code (including a failure, whether unintentional or in good
faith or otherwise).
7.1.2 You shall not be liable under this indemnification
provision with respect to any Losses to which an Indemnified Party would
otherwise be subject by reason of 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 and duties under this Agreement or to the Trust or Underwriter,
whichever is applicable. You shall also not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified you 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 Indemnified Party shall have received notice of such service on any
designated agent), but failure to notify you of any such claim shall not relieve
you from any liability which it may have to the Indemnified Party against whom
such action is brought otherwise than on account of this indemnification
provision. In case any such action is brought against the Indemnified Parties,
you shall be entitled to participate, at your own expense, in the defense of
such action. Unless the Indemnified Party releases you from
9
any further obligations under this Section 7.1, you also shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named in the
action. After notice from you to such party of the your election to assume the
defense thereof, the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and you 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.
7.1.3 The Indemnified Parties will promptly notify you 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.
7.2 INDEMNIFICATION BY THE UNDERWRITER
7.2.1 The Underwriter agrees to indemnify and hold harmless
you, and each of your directors and officers and each person, if any, who
controls you within the meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" and individually an "Indemnified Party" for purposes of
this Section 7.2) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Underwriter, which consent shall not be unreasonably withheld) 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, at common law or otherwise,
insofar as such Losses are related to the sale or acquisition of the shares of
the Trust or the Contracts and:
7.2.1.1 arise out of or are based upon any untrue
statements or alleged untrue statements of any material fact contained
in the Registration Statement, prospectus, statement of additional
information or sales literature of the Trust (or any amendment or
supplement to any of the foregoing) (collectively, the "Trust
Documents") 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 agreement to indemnify shall not apply as to any
Indemnified Party if such statement or omission of such alleged
statement or omission was made in reliance upon and in conformity with
information furnished to us by or on behalf of you for use in the
Registration Statement or prospectus for the Trust or in sales
literature (or any amendment or supplement) or otherwise for use in
connection with the sale of the Contracts or Trust shares; or
7.2.1.2 arise out of or as a result of statements or
representations (other than statements or representations contained in
the Disclosure Documents or sales literature for the Contracts not
supplied by the Underwriter or persons under its control) or wrongful
conduct of the Trust, Adviser or Underwriter or persons under their
control, with respect to the sale or distribution of the Contracts or
Trust shares; or
7.2.1.3 arise out of any untrue statement or alleged
untrue statement of a material fact contained in a Disclosure Document
or sales literature covering the Contracts,
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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, if such statement or omission was made in
reliance upon information furnished to you by or on behalf of the
Trust; or
7.2.1.4 arise as a result of any failure by us 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 qualification representation specified
above in Section 2.2.7 and the diversification requirements specified
above in Section 2.2.8); or
7.2.1.5 arise out of or result from any material
breach of any representation and/or warranty made by the Underwriter in
this Agreement or arise out of or result from any other material breach
of this Agreement by the Underwriter; as limited by and in accordance
with the provisions of Sections 7.2.2 and 7.2.3 hereof.
7.2.2 The Underwriter shall not be liable under this
indemnification provision with respect to any Losses to which an Indemnified
Party would otherwise be subject by reason of 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 and duties under this Agreement or to you or the
Accounts, whichever is applicable.
7.2.3 The Underwriter shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified the Underwriter 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 Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Underwriter of
any such claim shall not relieve the Underwriter from any liability which it may
have to the Indemnified Party against whom such action is brought otherwise than
on account of this indemnification provision. In case any such action is brought
against the Indemnified Parties, the Underwriter will be entitled to
participate, at its own expense, in the defense thereof. Unless the Indemnified
Party releases the Underwriter from any further obligations under this Section
7.2, the Underwriter also shall be entitled to assume the defense thereof, with
counsel satisfactory to the party named in the action. After notice from the
Underwriter to such party of the Underwriter's election to assume the defense
thereof, the Indemnified Party shall bear the expenses of any additional counsel
retained by it, and the Underwriter 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.
7.2.4 You agree promptly to notify the Underwriter of the
commencement of any litigation or proceedings against you or the Indemnified
Parties in connection with the issuance or sale of the Contracts or the
operation of each Account.
7.3 INDEMNIFICATION BY THE TRUST
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7.3.1 The Trust agrees to indemnify and hold harmless you,
and each of your directors and officers and each person, if any, who controls
you within the meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 7.3) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of the Trust, which consent shall not be unreasonably
withheld) or litigation (including legal and other expenses) to which the
Indemnified Parties may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses
(or actions in respect thereof) or settlements result from the gross negligence,
bad faith or willful misconduct of the Board or any member thereof, are related
to the operations of the Trust, and arise out of or result from any material
breach of any representation and/or warranty made by the Trust in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Trust; as limited by and in accordance with the provisions of
Sections 7.3.2 and 7.3.3 hereof. It is understood and expressly stipulated that
neither the holders of shares of the Trust nor any Trustee, officer, agent or
employee of the Trust shall be personally liable hereunder, nor shall any resort
be had to other private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
7.3.2 The Trust shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation incurred or assessed against any Indemnified Party
as such may arise 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 and duties
under this Agreement or to you, the Trust, the Underwriter or each Account,
whichever is applicable.
7.3.3 The Trust shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified the Trust in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claims shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Trust of any
such claim shall not relieve the Trust from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision. In case any such action is brought
against the Indemnified Parties, the Trust will be entitled to participate, at
its own expense, in the defense thereof. Unless the Indemnified Party releases
the Trust from any further obligations under this Section 7.3, the Trust also
shall be entitled to assume the defense thereof, with counsel satisfactory to
the party named in the action. After notice from the Trust to such party of the
Trust's election to assume the defense thereof, the Indemnified Party shall bear
the fees and expenses of any additional counsel retained by it, and the Trust
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.
7.3.4 You agree promptly to notify the Trust of the
commencement of any litigation or proceedings against you or the Indemnified
Parties in connection with this Agreement, the issuance or sale of the
Contracts, with respect to the operation of the Account, or the sale or
acquisition of shares of the Trust.
12
8. 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 in Schedule G below or
at such other address as such party may from time to time specify in writing to
the other party.
9. TERMINATION
9.1 redacted
9.2 redacted
9.3 If this Agreement is terminated for any reason, except as
required by the Shared Funding Order or pursuant to Section 9.2.5.3, above,
we shall, at your option, continue to make available additional shares of any
Portfolio and redeem shares of any Portfolio pursuant to all of the terms and
conditions of this Agreement for all Contracts in effect on the effective date
of termination of this Agreement. If this Agreement is terminated as required
by the Shared Funding Order, its provisions shall govern.
9.4 The provisions of Sections 2 (Representations and Warranties) and
7 (Indemnification) shall survive the termination of this Agreement. All other
applicable provisions of this Agreement shall survive the termination of this
Agreement, as long as shares of the Trust are held on behalf of Contract owners
in accordance with Section 9.3, except that we shall have no further obligation
to sell Trust shares with respect to Contracts issued after termination.
9.5 You shall not redeem Trust shares attributable to the Contracts
(as opposed to Trust shares attributable to your assets held in the Account)
except: (i) as necessary to implement Contract owner initiated or approved
transactions; (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"); or (iii) as permitted by an order of
the SEC pursuant to Section 26(b) of the 1940 Act. Upon reasonable request, you
shall promptly furnish to us the opinion of your counsel (which counsel shall be
reasonably satisfactory to us) 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, you shall not prevent
Contract owners from allocating payments to a Portfolio that was otherwise
available under the Contracts without first giving us ninety (90) days notice
of your intention to do so.
10. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions of this
Agreement or otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, all of which taken together shall constitute one and the same
instrument.
13
10.3 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.
10.4 This Agreement shall be construed and its provisions interpreted
under and in accordance with the laws of the State of California. It shall also
be subject to the provisions of the federal securities laws and the rules and
regulations thereunder, to any orders of the SEC on behalf of the Trust granting
it exemptive relief, and to the conditions of such orders. We shall promptly
forward copies of any such orders to you.
10.5 The parties to this Agreement acknowledge and agree that all
liabilities of the Trust arising, directly or indirectly, under this Agreement,
of any and every nature whatsoever, shall be satisfied solely out of the assets
of the Trust and that no Trustee, officer, agent or holder of shares of
beneficial interest of the Trust shall be personally liable for any such
liabilities.
10.6 The parties to this Agreement agree that the assets and
liabilities of each Portfolio of the Trust are separate and distinct from the
assets and liabilities of each other Portfolio. No Portfolio shall be liable or
shall be charged for any debt, obligation or liability of any other Portfolio.
10.7 Each party to this Agreement 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 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.
10.8 Each party to this Agreement shall treat as confidential all
information reasonably identified as confidential in writing by any other party
to this Agreement, and, except as permitted by this Agreement or as required by
legal process or regulatory authorities, shall not disclose, disseminate, or use
such names and addresses and other confidential information until such time as
they may come into the public domain, without the express written consent of the
affected party to this Agreement. Without limiting the foregoing, no party to
this Agreement shall disclose any information that such party has been advised
is proprietary, except such information that such party is required to disclose
by any appropriate governmental authority (including, without limitation, the
SEC, the NASD, and state securities and insurance regulators).
10.9 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, which the parties to this Agreement are
entitled to under state and federal laws.
10.10 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect, except as provided above in
Section 3.3.
10.11 Neither this Agreement nor any rights or obligations created
by it may be assigned by any party without the prior written approval of the
other parties.
14
10.12 No provisions of this Agreement may be amended or modified in
any manner except by a written agreement properly authorized and executed by
both parties.
15
IN WITNESS WHEREOF, each of the parties have caused their duly
authorized officers to execute this Agreement.
The Company: THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Second Vice President
The Trust: FRANKLIN XXXXXXXXX VARIABLE INSURANCE
ONLY ON BEHALF OF EACH PRODUCTS TRUST
PORTFOLIO LISTED ON
SCHEDULE C HEREOF.
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxx Xxxxxx
----------------------------------------
Name: Xxxx Xxxxxx
Title:
16
SCHEDULE A
THE COMPANY
The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
Incorporated in the State of Indiana.
17
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Lincoln Life Flexible Premium
Variable Life Account R
Date Established:
SEC Registration Number: 811-08579
2. Name: Lincoln Life Flexible Premium
Variable Life Account M
Date Established:
SEC Registration Number: 811-08557
3. Name: Lincoln Life Flexible Premium
Variable Account S
Date Established:
SEC Registration Number: 811-08579
4. Name: Lincoln Life Variable Annuity Account N
Date Established:
SEC Registration Number: 811-08517
18
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
redacted
19
SCHEDULE D
CONTRACTS OF THE COMPANY
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT 1 CONTRACT 2 CONTRACT 3
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT/PRODUCT SVUL I VUL I Lincoln VUL
NAME
--------------------------- ------------------------------- -------------------------------- -------------------------------
REGISTERED (Y/N) Yes Yes Yes
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 811-08579 811-08557 811-08557
--------------------------- ------------------------------- -------------------------------- -------------------------------
REPRESENTATIVE FORM LN650LL LN605LL LN660
NUMBERS LN615 LN615
LN660 LN605
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE Variable Life Variable Life Separate
ESTABLISHED Account R Account M Account M
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 333-43107 333-42479 333-42479
--------------------------- ------------------------------- -------------------------------- -------------------------------
PORTFOLIOS AND CLASSES Redacted Redacted Redacted
-ADVISER
--------------------------- ------------------------------- -------------------------------- -------------------------------
20
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT 4 CONTRACT 5 CONTRACT 6
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT/PRODUCT CVUL Lincoln SVUL VUL(DB)
NAME
--------------------------- ------------------------------- -------------------------------- -------------------------------
REGISTERED (Y/N) Yes Yes Yes
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 811-09241 811-08579 811-08557
--------------------------- ------------------------------- -------------------------------- -------------------------------
REPRESENTATIVE FORM LN920 LN650 LN680
NUMBERS LN921
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Variable Life Variable Life
ESTABLISHED Account S Account R Account M
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 333-72875 333-43107 333-82663
--------------------------- ------------------------------- -------------------------------- -------------------------------
PORTFOLIOS AND CLASSES Redacted Redacted Redacted
-ADVISER
--------------------------- ------------------------------- -------------------------------- -------------------------------
21
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT 7 CONTRACT 8 CONTRACT 9
--------------------------- ------------------------------- -------------------------------- -------------------------------
CONTRACT/PRODUCT Lincoln ChoicePlus Lincoln ChoicePlus Access Lincoln ChoicePlus Bonus
NAME Variable Annuity Variable Annuity Variable Annuity
--------------------------- ------------------------------- -------------------------------- -------------------------------
REGISTERED (Y/N) Yes Yes Yes
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 811-08517 811-08517 811-08517
--------------------------- ------------------------------- -------------------------------- -------------------------------
REPRESENTATIVE FORM AN425LL 30296 30295
NUMBERS
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Variable Annuity Lincoln Life Variable
NAME/DATE ESTABLISHED Account N Account N Annuity Account N
--------------------------- ------------------------------- -------------------------------- -------------------------------
SEC REGISTRATION NUMBER 333-40937 333-40937 333-40937
--------------------------- ------------------------------- -------------------------------- -------------------------------
PORTFOLIOS AND CLASSES Redacted Redacted Redacted
-ADVISER
--------------------------- ------------------------------- -------------------------------- -------------------------------
22
SCHEDULE E
OTHER PORTFOLIOS AVAILABLE UNDER THE CONTRACTS
redacted
23
SCHEDULE F
redacted
24
SCHEDULE G
ADDRESSES FOR NOTICES
To the Company: The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
To the Trust: Franklin Xxxxxxxxx Variable Insurance Products Trust
000 Xxxxxxxx Xxxxxx Xxxxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
To the Underwriter: Franklin Xxxxxxxxx Distributors, Inc.
000 Xxxxxxxx Xxxxxx Xxxxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
25
SCHEDULE H
SHARED FUNDING ORDER
Templeton Variable Products Series Fund, et al.
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24018
1999 SEC LEXIS 1887
September 17, 1999
ACTION: Notice of application for an amended order of exemption pursuant to
Section 6(c) of the Investment Company Act of 1940 (the "1940 Act") 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.
TEXT: Summary of Application: Templeton Variable Products Series Fund (the
"Xxxxxxxxx Trust"), Franklin Xxxxxxxxx Variable Insurance Products Trust
(formerly Franklin Valuemark Funds) (the "VIP Trust," and together with the
Templeton Trust, the "Funds"), Xxxxxxxxx Funds Annuity Company ("TFAC") or any
successor to TFAC, and any future open-end investment company for which TFAC or
any affiliate is the administrator, sub-administrator, investment manager,
adviser, principal underwriter, or sponsor ("Future Funds") seek an amended
order of the Commission to (1) add as parties to that order the VIP Trust and
any Future Funds and (2) permit shares of the Funds and Future Funds to be
issued to and held by qualified pension and retirement plans outside the
separate account context.
Applicants: Templeton Variable Products Series Fund, Franklin Xxxxxxxxx
Variable Insurance Products Trust, Xxxxxxxxx Funds Annuity Company or any
successor to TFAC, and any future open-end investment company for which TFAC or
any affiliate is the administrator, sub-administrator, investment manager,
adviser, principal underwriter, or sponsor (collectively, the "Applicants").
Filing Date: The application was filed on July 14, 1999, and amended and
restated on September 17, 1999.
Hearing or Notification of Hearing: An order granting the application will be
issued unless the Commission orders a hearing. Interested persons may request a
hearing by writing to the Secretary of the Commission and serving Applicants
with a copy of the request, personally or by mail. Hearing requests should be
received by the Commission by 5:30 p.m., on October 12, 1999, and should be
accompanied by proof of service on the Applicants in the form of an affidavit
26
or, for lawyers, a certificate of service. Hearing requests should state the
nature of the writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request notification
by writing to the Secretary of the Commission.
Addresses: Secretary, Securities and Exchange Commission, 000 Xxxxx Xxxxxx,
XX, Xxxxxxxxxx, X.X. 00000-0000.
Applicants: Templeton Variable Products Series Fund and Franklin Xxxxxxxxx
Variable Insurance Products Trust, 000 Xxxxxxxx Xxxxxx Xxxxxxxxx, Xxx Xxxxx,
Xxxxxxxxxx 00000, Attn: Xxxxx X. Xxxxxxxx, Esq.
For Further Information Contact: Xxxxx X. XxXxxxx, Senior Counsel, or
Xxxxx X. Xxxxx, Branch Chief, Office of Insurance Products, Division of
Investment Management, at (000) 000-0000.
Supplementary Information: The following is a summary of the application.
The complete application is available for a fee from the SEC's Public Reference
Branch, 000 Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000-0000
(tel. (000) 000-0000).
Applicants' Representations:
1. Each of the Funds is registered under the 1940 Act as an open-end
management investment company and was organized as a Massachusetts business
trust. The Templeton Trust currently consists of eight separate series, and the
VIP Trust consists of twenty-five separate series. Each Fund's Declaration of
Trust permits the Trustees to create additional series of shares at any time.
The Funds currently serve as the underlying investment medium for variable
annuity contracts and variable life insurance policies issued by various
insurance companies. The Funds have entered into investment management
agreements with certain investment managers ("Investment Managers") directly or
indirectly owned by Franklin Resources, Inc. ("Resources"), a publicly owned
company engaged in the financial services industry through its subsidiaries.
2. TFAC is an indirect, wholly owned subsidiary of Resources. TFAC is the
sole insurance company in the Franklin Xxxxxxxxx organization, and specializes
in the writing of variable annuity contracts. The Templeton Trust has entered
into a Fund Administration Agreement with Franklin Xxxxxxxxx Services, Inc. ("FT
Services"), which replaced TFAC in 1998 as administrator, and FT Services
subcontracts certain services to TFAC. FT Services also serves as administrator
to all series of the VIP Trust. TFAC and FT Services provide certain
administrative facilities and services for the VIP and Xxxxxxxxx Trusts.
3. On November 16, 1993, the Commission issued an order granting exemptive
relief to permit shares of the Xxxxxxxxx Trust to be sold to and held by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies (Investment Company Act
Release No. 19879, File No. 812-8546) (the "Original Order"). Applicants
incorporate by reference into the application the Application for the Original
Order and each amendment thereto, the Notice of Application for the Original
Order, and the Original
27
Order, to the extent necessary, to supplement the representations made in the
application in support of the requested relief. Applicants represent that all
of the facts asserted in the Application for the Original Order and any
amendments thereto remain true and accurate in all material respects to the
extent that such facts are relevant to any relief on which Applicants continue
to rely. The Original Order allows the Xxxxxxxxx Trust to offer its shares to
insurance companies as the investment vehicle for their separate accounts
supporting variable annuity contracts and variable life insurance contracts
(collectively, the "Variable Contracts"). Applicants state that the Original
Order does not (i) include the VIP Trust or Future Funds as parties, nor
(ii) expressly address the sale of shares of the Funds or any Future Funds to
qualified pension and retirement plans outside the separate account context
including, without limitation, those trusts, plans, accounts, contracts or
annuities described in Sections 401(a), 403(a), 403(b), 408(b), 408(k), 414(d),
457(b), 501(c)(18) of the Internal Revenue Code of 1986, as amended (the
"Code"), and any other trust, plan, contract, account or annuity that is
determined to be within the scope of Treasury Regulation 1.817.5(f)(3)(iii)
("Qualified Plans").
4. Separate accounts owning shares of the Funds and their insurance company
depositors are referred to in the application as "Participating Separate
Accounts" and "Participating Insurance Companies," respectively. The use of a
common management investment company as the underlying investment medium for
both variable annuity and variable life insurance separate accounts of a single
insurance company (or of two or more affiliated insurance companies) is referred
to as "mixed funding." The use of a common management investment company as the
underlying investment medium for variable annuity and/or variable life insurance
separate accounts of unaffiliated insurance companies is referred to as "shared
funding."
Applicants' Legal Analysis:
1. Applicants request that the Commission issue an amended order pursuant to
Section 6(c) of the 1940 Act, adding the VIP Trust and Future Funds to the
Original Order and exempting scheduled premium variable life insurance separate
accounts and flexible premium variable life insurance separate accounts of
Participating Insurance Companies (and, to the extent necessary, any principal
underwriter and depositor of such an account) and the Applicants from 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) (and any comparable rule) thereunder, respectively, to the extent
necessary to permit shares of the Funds and any Future Funds to be sold to and
held by Qualified Plans. Applicants submit that the exemptions requested are
appropriate in the public interest, consistent with the protection of investors,
and consistent with the purposes fairly intended by the policy and provisions of
the 1940 Act.
2. The Original Order does not include the VIP Trust or Future Funds as
parties nor expressly address the sale of shares of the Funds or any Future
Funds to Qualified Plans. Applicants propose that the VIP Trust and Future Funds
be added as parties to the Original Order and the Funds and any Future Funds be
permitted to offer and sell their shares to Qualified Plans.
3. Section 6(c) of the 1940 Act provides, in part, that the Commission, by
order upon application, may conditionally or unconditionally exempt any person,
security or transaction, or
28
any class or classes of persons, securities or transactions from any provisions
of the 1940 Act or the rules or regulations thereunder, if and to the extent
that such exemption is necessary or appropriate in the public interest and
consistent with the protection of investors and the purposes fairly intended
by the policy and provisions of the 1940 Act.
4. In connection with the funding of scheduled premium variable life
insurance contracts issued through a separate account registered under the 1940
Act as a unit investment trust ("UIT"), Rule 6e-2(b)(15) provides partial
exemptions from various provisions of the 1940 Act, including the following: (1)
Section 9(a), which makes it unlawful for certain individuals to act in the
capacity of employee, officer, or director for a UIT, by limiting the
application of the eligibility restrictions in Section 9(a) to affiliated
persons directly participating in the management of a registered management
investment company; and (2) Sections 13(a), 15(a) and 15(b) of the 1940 Act to
the extent that those sections might be deemed to require "pass-through" voting
with respect to an underlying fund's shares, by allowing an insurance company to
disregard the voting instructions of contractowners in certain circumstances.
5. These exemptions are available, however, only where the management
investment company underlying the separate account (the "underlying fund")
offers its shares "exclusively to variable life insurance separate accounts of
the life insurer, or of any affiliated life insurance company." Therefore, Rule
6e-2 does not permit either mixed funding or shared funding because the relief
granted by Rule 6e-2(b)(15) is not available with respect to a scheduled premium
variable life insurance separate account that owns shares of an underlying fund
that also offers its shares to a variable annuity or a flexible premium variable
life insurance separate account of the same company or of any affiliated life
insurance company. Rule 6e-2(b)(15) also does not permit the sale of shares of
the underlying fund to Qualified Plans.
6. In connection with flexible premium variable life insurance contracts
issued through a separate account registered under the 1940 Act as a UIT, Rule
6e-3(T)(b)(15) also provides partial exemptions from Sections 9(a), 13(a), 15(a)
and 15(b) of the 1940 Act. These exemptions, however, are available only where
the separate account's underlying fund offers its shares "exclusively to
separate accounts of the life insurer, or of any affiliated life insurance
company, offering either scheduled contracts or flexible contracts, or both; or
which also offer their shares to variable annuity separate accounts of the life
insurer or of an affiliated life insurance company." Therefore, Rule 6e-3(T)
permits mixed funding but does not permit shared funding and also does not
permit the sale of shares of the underlying fund to Qualified Plans. As noted
above, the Original Order granted the Xxxxxxxxx Trust exemptive relief to permit
mixed and shared funding, but did not expressly address the sale of its shares
to Qualified Plans.
7. Applicants note that if the Funds were to sell their shares only to
Qualified Plans, exemptive relief under Rule 6e-2 and Rule 6e-3(T) would not be
necessary. Applicants state that the relief provided for under Rule 6e-2(b)(15)
and Rule 6e-3(T)(b)(15) does not relate to qualified pension and retirement
plans or to a registered investment company's ability to sell its shares to such
plans.
29
8. Applicants state that changes in the federal tax law have created the
opportunity for each of the Funds to increase its asset base through the sale of
its shares to Qualified Plans. Applicants state that Section 817(h) of the
Internal Revenue Code of 1986, as amended (the "Code"), imposes certain
diversification standards on the assets underlying Variable Contracts. Treasury
Regulations generally require that, to meet the diversification requirements,
all of the beneficial interests in the underlying investment company must be
held by the segregated asset accounts of one or more life insurance companies.
Notwithstanding this, Applicants note that the Treasury Regulations also contain
an exception to this requirement that permits trustees of a Qualified Plan to
hold shares of an investment company, the shares of which are also held by
insurance company segregated asset accounts, without adversely affecting the
status of the investment company as an adequately diversified underlying
investment of Variable Contracts issued through such segregated asset accounts
(Treas. Reg. 1.817-5(f)(3)(iii)).
9. Applicants state that the promulgation of Rules 6e-2(b)(15) and
6e-3(T)(b)(15) under the 1940 Act preceded the issuance of these Treasury
Regulations. Thus, Applicants assert that the sale of shares of the same
investment company to both separate accounts and Qualified Plans was not
contemplated at the time of the adoption of Rules 6e-2(b)(15) and
6e-3(T)(b)(15).
10. Section 9(a) provides that it is unlawful for any company to serve as
investment adviser or principal underwriter of any registered open-end
investment company if an affiliated person of that company is subject to a
disqualification enumerated in Section 9(a)(1) or (2). Rules 6e-2(b)(15) and
6e-3(T)(b)(15) provide exemptions from Section 9(a) under certain circumstances,
subject to the limitations on mixed and shared funding. These exemptions limit
the application of the eligibility restrictions to affiliated individuals or
companies that directly participate in the management of the underlying
portfolio investment company.
11. Applicants state that the relief granted in Rule 6e-2(b)(15) and
6e-3(T)(b)(15) from the requirements of Section 9 limits, in effect, the amount
of monitoring of an insurer's personnel that would otherwise be necessary to
ensure compliance with Section 9 to that which is appropriate in light of the
policy and purposes of Section 9. Applicants submit that those Rules recognize
that it is not necessary for the protection of investors or the purposes fairly
intended by the policy and provisions of the 1940 Act to apply the provisions of
Section 9(a) to the many individuals involved in an insurance company complex,
most of whom typically will have no involvement in matters pertaining to
investment companies funding the separate accounts.
12. Applicants to the Original Order previously requested and received relief
from Section 9(a) and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) to the extent
necessary to permit mixed and shared funding. Applicants maintain that the
relief previously granted from Section 9(a) will in no way be affected by the
proposed sale of shares of the Funds to Qualified Plans. Those individuals who
participate in the management or administration of the Funds will remain the
same regardless of which Qualified Plans use such Funds. Applicants maintain
that more broadly applying the requirements of Section 9(a) because of
investment by Qualified Plans would not serve any regulatory purpose. Moreover,
Qualified Plans, unlike separate accounts, are not themselves investment
companies and therefore are not subject to Section 9 of the 1940 Act.
30
13. Applicants state that Rules 6e-2(b)(15)(iii) and 6e-3(T)(b)(15)(iii)
provide exemptions from the pass-through voting requirement with respect to
several significant matters, assuming the limitations on mixed and shared
funding are observed. Rules 6e-2(b)(15)(iii)(A) and 6e-3(T)(b)(15)(iii)(A)
provide that the insurance company may disregard the voting instructions of its
contractowners with respect to the investments of an underlying fund or any
contract between a fund and its investment adviser, when required to do so by an
insurance regulatory authority (subject to the provisions of paragraphs
(b)(5)(i) and (b)(7)(ii)(A) of the Rules). Rules 6e-2(b)(15)(iii)(B) and
6e-3(T)(b)(15)(iii)(A)(2) provide that the insurance company may disregard
contractowners' voting instructions if the contractowners initiate any change in
such company's investment policies, principal underwriter, or any investment
adviser (provided that disregarding such voting instructions is reasonable and
subject to the other provisions of paragraphs (b)(5)(ii) and (b)(7)(ii)(B) and
(C) of the Rules).
14. Applicants assert that Qualified Plans, which are not registered as
investment companies under the 1940 Act, have no requirement to pass-through the
voting rights to plan participants. Applicants state that applicable law
expressly reserves voting rights to certain specified persons. Under Section
403(a) of the Employment Retirement Income Security Act ("ERISA"), shares of a
fund sold to a Qualified Plan must be held by the trustees of the Qualified
Plan. Section 403(a) also provides that the trustee(s) must have exclusive
authority and discretion to manage and control the Qualified Plan with two
exceptions: (1) when the Qualified Plan expressly provides that the trustee(s)
are subject to the direction of a named fiduciary who is not a trustee, in which
case the trustees are subject to proper directions made in accordance with the
terms of the Qualified Plan and not contrary to ERISA; and (2) when the
authority to manage, acquire or dispose of assets of the Qualified Plan is
delegated to one or more investment managers pursuant to Section 402(c)(3) of
ERISA. Unless one of the two above exceptions stated in Section 403(a) applies,
Qualified Plan trustees have the exclusive authority and responsibility for
voting proxies. Where a named fiduciary to a Qualified Plan appoints an
investment manager, the investment manager has the responsibility to vote the
shares held unless the right to vote such shares is reserved to the trustees or
the named fiduciary. Where a Qualified Plan does not provide participants with
the right to give voting instructions, Applicants do not see any potential for
material irreconcilable conflicts of interest between or among variable contract
holders and Qualified Plan investors with respect to voting of the respective
Fund's shares. Accordingly, Applicants state that, unlike the case with
insurance company separate accounts, the issue of the resolution of material
irreconcilable conflicts with respect to voting is not present with respect to
such Qualified Plans since the Qualified Plans are not entitled to pass-through
voting privileges.
15. Even if a Qualified Plan were to hold a controlling interest in one of
the Funds, Applicants believe that such control would not disadvantage other
investors in such Fund to any greater extent than is the case when any
institutional shareholder holds a majority of the voting securities of any
open-end management investment company. In this regard, Applicants submit that
investment in a Fund by a Qualified Plan will not create any of the voting
complications occasioned by mixed funding or shared funding. Unlike mixed or
shared funding, Qualified Plan investor voting rights cannot be frustrated by
veto rights of insurers or state regulators.
31
16. Applicants state that some of the Qualified Plans, however, may provide
for the trustee(s), an investment adviser (or advisers), or another named
fiduciary to exercise voting rights in accordance with instructions from
participants. Where a Qualified Plan provides participants with the right to
give voting instructions, Applicants see no reason to believe that participants
in Qualified Plans generally or those in a particular Qualified Plan, either as
a single group or in combination with participants in other Qualified Plans,
would vote in a manner that would disadvantage Variable Contract holders. In
sum, Applicants maintain that the purchase of shares of the Funds by Qualified
Plans that provide voting rights does not present any complications not
otherwise occasioned by mixed or shared funding.
17. Applicants do not believe that the sale of the shares of the Funds to
Qualified Plans will increase the potential for material irreconcilable
conflicts of interest between or among different types of investors. In
particular, Applicants see very little potential for such conflicts beyond that
which would otherwise exist between variable annuity and variable life insurance
contractowners.
18. As noted above, Section 817(h) of the Code imposes certain
diversification standards on the underlying assets of variable contracts held in
an underlying mutual fund. The Code provides that a variable contract shall not
be treated as an annuity contract or life insurance, as applicable, for any
period (and any subsequent period) for which the investments are not, in
accordance with regulations prescribed by the Treasury Department, adequately
diversified.
19. Treasury Department Regulations issued under Section 817(h) provide that,
in order to meet the statutory diversification requirements, all of the
beneficial interests in the investment company must be held by the segregated
asset accounts of one or more insurance companies. However, the Regulations
contain certain exceptions to this requirement, one of which allows shares in an
underlying mutual fund to be held by the trustees of a qualified pension or
retirement plan without adversely affecting the ability of shares in the
underlying fund also to be held by separate accounts of insurance companies in
connection with their variable contracts (Treas. Reg. 1.817-5(f)(3)(iii)). Thus,
Applicants believe that the Treasury Regulations specifically permit "qualified
pension or retirement plans" and separate accounts to invest in the same
underlying fund. For this reason, Applicants have concluded that neither the
Code nor the Treasury Regulations or revenue rulings thereunder presents any
inherent conflict of interest.
20. Applicants note that while there are differences in the manner in which
distributions from Variable Contracts and Qualified Plans are taxed, these
differences will have no impact on the Funds. When distributions are to be made,
and a Separate Account or Qualified Plan is unable to net purchase payments to
make the distributions, the Separate Account and Qualified Plan will redeem
shares of the Funds at their respective net asset value in conformity with Rule
22c-1 under the 1940 Act (without the imposition of any sales charge) to provide
proceeds to meet distribution needs. A Qualified Plan will make distributions in
accordance with the terms of the Qualified Plan.
21. Applicants maintain that it is possible to provide an equitable means of
giving voting rights to Participating Separate Account contractowners and to
Qualified Plans. In connection with any meeting of shareholders, the Funds will
inform each shareholder, including each Participating
32
Insurance Company and Qualified Plan, of information necessary for the meeting,
including their respective share of ownership in the relevant Fund. Each
Participating Insurance Company will then solicit voting instructions in
accordance with Rules 6e-2 and 6e-3(T), as applicable, and its
participation agreement with the relevant Fund. Shares held by Qualified
Plans will be voted in accordance with applicable law. The voting rights
provided to Qualified Plans with respect to shares of the Funds would be no
different from the voting rights that are provided to Qualified Plans with
respect to shares of funds sold to the general public.
22. Applicants have concluded that even if there should arise issues with
respect to a state insurance commissioner's veto powers over investment
objectives where the interests of contractowners and the interests of Qualified
Plans are in conflict, the issues can be almost immediately resolved since the
trustees of (or participants in) the Qualified Plans can, on their own, redeem
the shares out of the Funds. Applicants note that state insurance commissioners
have been given the veto power in recognition of the fact that insurance
companies usually cannot simply redeem their separate accounts out of one fund
and invest in another. Generally, time-consuming, complex transactions must be
undertaken to accomplish such redemptions and transfers. Conversely, the
trustees of Qualified Plans or the participants in participant-directed
Qualified Plans can make the decision quickly and redeem their interest in the
Funds and reinvest in another funding vehicle without the same regulatory
impediments faced by separate accounts or, as is the case with most Qualified
Plans, even hold cash pending suitable investment.
23. Applicants also state that they do not see any greater potential for
material irreconcilable conflicts arising between the interests of participants
under Qualified Plans and contractowners of Participating Separate Accounts from
possible future changes in the federal tax laws than that which already exist
between variable annuity contractowners and variable life insurance
contractowners.
24. Applicants state that the sale of shares of the Funds to Qualified Plans
in addition to separate accounts of Participating Insurance Companies will
result in an increased amount of assets available for investment by the Funds.
This may benefit variable contractowners by promoting economies of scale, by
permitting increased safety of investments through greater diversification, and
by making the addition of new portfolios more feasible.
25. Applicants assert that, regardless of the type of shareholders in each
Fund, each Fund's Investment Manager is or would be contractually and otherwise
obligated to manage the Fund solely and exclusively in accordance with that
Fund's investment objectives, policies and restrictions as well as any
guidelines established by the Board of Trustees of such Fund (the "Board"). The
Investment Manager works with a pool of money and (except in a few instances
where this may be required in order to comply with state insurance laws) does
not take into account the identity of the shareholders. Thus, each Fund will be
managed in the same manner as any other mutual fund. Applicants therefore see no
significant legal impediment to permitting the sale of shares of the Funds to
Qualified Plans.
26. Applicants state that the Commission has permitted the amendment of a
substantially similar original order for the purpose of adding a party to the
original order and has permitted open-end
33
management investment companies to offer their shares directly to Qualified
Plan in addition to separate accounts of affiliated or unaffiliated insurance
companies which issue either or both variable annuity contracts or variable
life insurance contracts. Applicants state that the amended order sought in
the application is identical to precedent with respect to the conditions
Applicants propose should be imposed on Qualified Plans in connection with
investment in the Funds.
Applicants' Conditions:
If the requested amended order is granted, Applicants consent to the
following conditions:
1. A majority of the Board of each Fund shall consist of persons who are not
"interested persons" thereof, as defined by Section 2(a)(19) of the 1940 Act,
and the rules thereunder and as modified by any applicable orders of the
Commission, except that if this condition is not met by reason of the death,
disqualification or bona fide resignation of any Board Member or Members, then
the operation of this condition shall be suspended: (a) for a period of 45 days
if the vacancy or vacancies may be filled by the remaining Board Members; (b)
for a period of 60 days if a vote of shareholders is required to fill the
vacancy or vacancies; or (c) for such longer period as the Commission may
prescribe by order upon application.
2. The Board will monitor their respective Fund for the existence of any
material irreconcilable conflict among the interests of the Variable Contract
owners of all Separate Accounts investing in the Funds and of the Qualified Plan
participants investing in the Funds. The Board will determine what action, if
any, shall be taken in response to such conflicts. A material irreconcilable
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 interpretive 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 the Funds are being managed; (e) a difference in voting
instructions given by variable annuity contract owners, variable life insurance
contract owners, and trustees of Qualified Plans; (f) a decision by an insurer
to disregard the voting instructions of Variable Contract owners; or (g) if
applicable, a decision by a Qualified Plan to disregard the voting instructions
of Qualified Plan participants.
3. Participating Insurance Companies, the Investment Managers, and any
Qualified Plan that executes a fund
participation agreement upon becoming an
owner of 10 percent or more of the assets of an Fund (a "Participating Qualified
Plan"), will report any potential or existing conflicts of which it becomes
aware to the Board of any relevant Fund. Participating Insurance Companies, the
Investment Managers and the Participating Qualified Plans will be responsible
for assisting the Board in carrying out its responsibilities under these
conditions by providing the Board with all information reasonably necessary for
the Board to consider any issues raised. This responsibility includes, but is
not limited to, an obligation by each Participating Insurance Company to inform
the Board whenever voting instructions of Contract owners are disregarded and,
if pass-through voting is applicable, an obligation by each Participating
Qualified Plan to inform the Board whenever it has determined to disregard
Qualified Plan participant voting instructions. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
34
obligations of all Participating Insurance Companies investing in the Funds
under their agreements governing participation in the Funds, and such agreements
shall provide that these responsibilities will be carried out with a view only
to the interests of the Variable Contract owners. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
obligations of all Participating Qualified Plans under their agreements
governing participation in the Funds, and such agreements will provide that
their responsibilities will be carried out with a view only to the interests of
Qualified Plan participants.
4. If it is determined by a majority of the Board of a Fund, or by a majority
of the disinterested Board Members, that a material irreconcilable conflict
exists, the relevant Participating Insurance Companies and Participating
Qualified Plans will, at their own expense and to the extent reasonably
practicable as determined by a majority of the disinterested Board Members, take
whatever steps are necessary to remedy or eliminate the material irreconcilable
conflict, which steps could include: (a) in the case of Participating Insurance
Companies, withdrawing the assets allocable to some or all of the Separate
Account s from the Fund or any portfolio thereof and reinvesting such assets in
a different investment medium, including another portfolio of an Fund or another
Fund, or submitting the question as to whether such segregation should be
implemented to a vote of all affected Variable Contract owners and, as
appropriate, segregating the assets of any appropriate group (i.e., variable
annuity contract owners or variable life insurance contract owners of one or
more Participating Insurance Companies) that votes in favor of such segregation,
or offering to the affected Variable Contract owners the option of making such a
change; (b) in the case of Participating Qualified Plans, withdrawing the assets
allocable to some or all of the Qualified Plans from the Fund and reinvesting
such assets in a different investment medium; and (c) establishing a new
registered management investment company or managed Separate Account. If a
material irreconcilable conflict arises because of a decision by a Participating
Insurance Company to disregard Variable Contract owner voting instructions, and
that decision represents a minority position or would preclude a majority vote,
then the insurer may be required, at the Fund's election, to withdraw the
insurer's Separate Account investment in such Fund, and no charge or penalty
will be imposed as a result of such withdrawal. If a material irreconcilable
conflict arises because of a Participating Qualified Plan's decision to
disregard Qualified Plan participant voting instructions, if applicable, and
that decision represents minority position or would preclude a majority vote,
the Participating Qualified Plan may be required, at the Fund's election, to
withdraw its investment in such Fund, and no charge or penalty will be imposed
as a result of such withdrawal. The responsibility to take remedial action in
the event of a determination by a Board of a material irreconcilable conflict
and to bear the cost of such remedial action will be a contractual obligation of
all Participating Insurance Companies and Participating Qualified Plans under
their agreements governing participation in the Funds, and these
responsibilities will be carried out with a view only to the interest of
Variable Contract owners and Qualified Plan participants.
5. For purposes of Condition 4, a majority of the disinterested Board Members
of the applicable Board will determine whether or not any proposed action
adequately remedies any material irreconcilable conflict, but in no event will
the relevant Fund or the Investment Managers be required to establish a new
funding medium for any Contract. No Participating Insurance Company shall be
required by Condition 4 to establish a new funding medium for any Variable
35
Contract if any offer to do so has been declined by vote of a majority of the
Variable Contract owners materially and adversely affected by the material
irreconcilable conflict. Further, no Participating Qualified Plan shall be
required by Condition 4 to establish a new funding medium for any Participating
Qualified Plan if (a) a majority of Qualified Plan participants materially and
adversely affected by the irreconcilable material conflict vote to decline such
offer, or (b) pursuant to governing Qualified Plan documents and applicable law,
the Participating Qualified Plan makes such decision without a Qualified Plan
participant vote.
6. The determination of the Board of the existence of a material
irreconcilable conflict and its implications will be made known in writing
promptly to all Participating Insurance Companies and Participating Qualified
Plans.
7. Participating Insurance Companies will provide pass-through voting
privileges to Variable Contract owners who invest in registered Separate
Accounts so long as and to the extent that the Commission continues to interpret
the 1940 Act as requiring pass-through voting privileges for Variable Contract
owners. As to Variable Contracts issued by unregistered Separate Accounts,
pass-through voting privileges will be extended to participants to the extent
granted by issuing insurance companies. Each Participating Insurance Company
will also vote shares of the Funds held in its Separate Accounts for which no
voting instructions from Contract owners are timely received, as well as shares
of the Funds which the Participating Insurance Company itself owns, in the same
proportion as those shares of the Funds for which voting instructions from
contract owners are timely received. Participating Insurance Companies will be
responsible for assuring that each of their registered Separate Accounts
participating in the Funds calculates voting privileges in a manner consistent
with other Participating Insurance Companies. The obligation to calculate voting
privileges in a manner consistent with all other registered Separate Accounts
investing in the Funds will be a contractual obligation of all Participating
Insurance Companies under their agreements governing their participation in the
Funds. Each Participating Qualified Plan will vote as required by applicable law
and governing Qualified Plan documents.
8. All reports of potential or existing conflicts received by the Board of a
Fund and all action by such Board with regard to determining the existence of a
conflict, notifying Participating Insurance Companies and Participating
Qualified Plans of a conflict, and determining whether any proposed action
adequately remedies a conflict, will be properly recorded in the minutes of the
meetings of such Board or other appropriate records, and such minutes or other
records shall be made available to the Commission upon request.
9. Each Fund will notify all Participating Insurance Companies that separate
disclosure in their respective Separate Account prospectuses may be appropriate
to advise accounts regarding the potential risks of mixed and shared funding.
Each Fund shall disclose in its prospectus that (a) the Fund is intended to be a
funding vehicle for variable annuity and variable life insurance contracts
offered by various insurance companies and for qualified pension and retirement
plans; (b) due to differences of tax treatment and other considerations, the
interests of various Contract owners participating in the Fund and/or the
interests of Qualified Plans investing in the Fund may at some time be in
conflict; and (c) the Board of such Fund will monitor events in order to
identify the
36
existence of any material irreconcilable conflicts and to determine
what action, if any, should be taken in response to any such conflict.
10. Each Fund will comply with all provisions of the 1940 Act requiring
voting by shareholders (which, for these purposes, will be the persons having a
voting interest in the shares of the Funds), and, in particular, the Funds will
either provide for annual shareholder meetings (except insofar as 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 Funds are not the type of trust
described in Section 16(c) of the 1940 Act, as well as with Section 16(a) of the
1940 Act and, if and when applicable, Section 16(b) of the 1940 Act. Further,
each Fund will act in accordance with the Commission's interpretation of the
requirements of Section 16(a) with respect to periodic elections of Board
Members and with whatever rules the Commission may promulgate with respect
thereto.
11. If and to the extent Rules 6e-2 or 6e-3(T) under the 1940 Act is amended,
or proposed Rule 6e-3 under the 1940 Act 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 on terms and conditions materially different
from any exemptions granted in the order requested in the application, then the
Funds and/or Participating Insurance Companies and Participating Qualified
Plans, as appropriate, shall take such steps as may be necessary to comply with
such Rules 6e-2 and 6e-3(T), as amended, or proposed Rule 6e-3, as adopted, to
the extent that such Rules are applicable.
12. The Participating Insurance Companies and Participating Qualified Plans
and/or the Investment Managers, at least annually, will submit to the Board such
reports, materials or data as the Board may reasonably request so that the Board
may fully carry out obligations imposed upon it by the conditions contained in
the application. Such reports, materials and data will be submitted more
frequently if deemed appropriate by the Board. The obligations of the
Participating Insurance Companies and Participating Qualified Plans to provide
these reports, materials and data to the Board, when the Board so reasonably
requests, shall be a contractual obligation of all Participating Insurance
Companies and Participating Qualified Plans under their agreements governing
participation in the Funds.
13. If a Qualified Plan should ever become a holder of ten percent or more of
the assets of a Fund, such Qualified Plan will execute a
participation agreement
with the Fund that includes the conditions set forth herein to the extent
applicable. A Qualified Plan will execute an application containing an
acknowledgment of this condition upon such Qualified Plan's initial purchase of
the shares of any Fund.
Conclusion:
Applicants assert that, for the reasons summarized above, the requested
exemptions are appropriate in the public interest and consistent with the
protection of investors and the purposes fairly intended by the policy and
provisions of the 1940 Act.
37
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
38
Templeton Variable Products Series Fund, et al.
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24079
1999 SEC LEXIS 2177
October 13, 1999
ACTION: Order Granting Exemptions
TEXT: Templeton Variable Products Series Fund ("Templeton Trust"), Franklin
Xxxxxxxxx Variable Insurance Products Trust ("VIP Trust"), Xxxxxxxxx Funds
Annuity Company ("TFAC") or any successor to TFAC, and any future open-end
investment company for which TFAC or any affiliate is the administrator,
sub-administrator, investment manager, adviser, principal underwriter, or
sponsor ("Future Funds") filed an application on July 14, 1999, and an amendment
on September 17, 1999 seeking an amended order of the Commission pursuant to
Section 6(c) of the Investment Company Act of 1940 ("1940 Act") exempting them
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). The prior order (Rel. No. IC-19879)
granted exemptive relief to permit shares of the Templeton Trust to be sold to
and held by variable annuity and variable life insurance separate accounts of
both affiliated and unaffiliated life insurance companies. The proposed relief
would amend the prior order to add as parties to that order the VIP Trust and
any Future Funds and to permit shares of the Templeton Trust, the VIP Trust, and
Future Funds to be issued to and held by qualified pension and retirement plans
outside the separate account context.
A notice of the filing of the application was issued on September 17, 1999
(Rel. No. IC-24018). The notice gave interested persons an opportunity to
request a hearing and stated that an order granting the application would be
issued unless a hearing should be ordered. No request for a hearing has been
filed, and the Commission has not ordered a hearing.
The matter has been considered, and it is found that granting the requested
exemptions is appropriate in the public interest and consistent with the
protection of investors and the purposes intended by the policy and provisions
of the 1940 Act.
Accordingly,
IT IS ORDERED, pursuant to Section 6(c) of the 1940 Act, that the requested
exemptions from 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, be, and hereby are, granted,
effective forthwith.
39
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
40
AMENDMENT TO
PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
The
participation agreement, dated as of May 1, 2000, by and among Franklin
Templetion Variable Insurance Products Trust, Franklin Xxxxxxxxx
Distributors, Inc. and The Lincoln National Life Insurance Company (the
"Agreement") is hereby amended as follows:
Section 4.4 of the Agreement is deleted in its entirety and
replaced with the following provision:
4.4 At your option, we shall provide you, at our expense,
with either: (i) for each Contract owner who is invested through the
Account in a subaccount corresponding to a Portfolio ("designated
subaccount"), one copy of each of the following documents on each
occasion that such document is required by law or regulation to be
delivered to such Contract owner who is invested in a designated
subaccount: the Trust's current prospectus, annual report,
semi-annual report and other shareholder communications, including
any amendments or supplements to any of the foregoing, pertaining
specifically to the Portfolios ("Designated Portfolio Documents"); or
(ii) a camera ready copy of such Designated Portfolio Documents in a
form suitable for printing and from which information relating to
series of the Trust other than the Portfolios has been deleted to the
extent practicable. In connection with clause (ii) of this paragraph,
we will pay for proportional printing costs for such Designated
Portfolio Documents in order to provide one copy for each Contract
owner who is invested in a designated subaccount on each occasion
that such document is required by law or regulation to be delivered
to such Contract owner, and provided the appropriate documentation is
provided and approved by us. We shall provide you with a copy of the
Trust's current statement of additional information, including any
amendments or supplements, in a form suitable for you to duplicate.
The expenses of furnishing, including mailing, to Contract owners the
documents refereed to in this paragraph shall he borne by you. For
each of the documents provided to you in accordance with clause (i)
of this paragraph 4.4, we shall provide you, upon your request and at
your expense, additional copies. In no event shall we be responsible
for the costs of printing or delivery of Designated Portfolio
Documents to potential or new Contract owners or the delivery of
Designated Portfolio Documents to existing contract owners.
All other ten's and provisions of the Agreement not amended herein shall
remain in full force and effect
Effective Date as of May 1,2000.
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST FRANKLIN XXXXXXXXX DISTRIBUTORS. INC.
---------------------------------------------------- --------------------------------
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxx Xxxxxx
Name: Xxxxx X. Xxxxxxxx Name: Xxxx Xxxxxx
Title: Assistant Vice President Title: Vice President
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
-------------------------------------------
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Second Vice President
AMENDMENT TO
PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
The
participation agreement, dated as of May 1, 2000, by and among Franklin
Xxxxxxxxx Variable Insurance Products Trust, Franklin Xxxxxxxxx Distributors,
Inc. and The Lincoln National Life Insurance Company (the "Agreement") is hereby
amended as follows:
Schedule D of the Agreement is hereby deleted in its entirety and
replaced with the Schedule D attached hereto.
All other terms and provisions of the Agreement not amended herein shall remain
in full force and effect.
Effective Date as of July 15, 2001.
FRANKLIN XXXXXXXXX VARIABLE FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
INSURANCE PRODUCTS TRUST
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxx Xxxxxx
--------------------- ---------------------
Name: Xxxxx X. Xxxxxxxx Name: Xxxxxx Xxxxxx
Title: Assistant Vice President Title: Vice President
THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Second Vice President
SCHEDULE D
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 1 CONTRACT 2 CONTRACT 3
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME SVUL I VUL I Lincoln VUL
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-43107 333-42479 333-42479
REPRESENTATIVE FORM LN650LL LN605LL LN660
NUMBERS LN615 LN615
LN660 LN605
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account R Variable Life Account M Separate Account M
12/2/97 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-08579 811-08557 811-08557
PORTFOLIOS AND CLASSES Templeton Asset Strategy Fund Templeton Asset Strategy Fund Xxxxxxxxx International
-ADVISER - Class 1 Templeton Global - Class 1 Templeton Global Securities Fund - Class 2 -
Advisors Limited Advisors Limited Xxxxxxxxx Investment Counsel,
Inc.
Xxxxxxxxx International Xxxxxxxxx International
Securities Fund - Class 1- Securities Fund - Class 1 - Templeton Growth Securities
Xxxxxxxxx Investment Counsel, Xxxxxxxxx Investment Counsel, Fund - Class 2 - Templeton
Inc. Inc. Global Advisors Limited
Templeton Growth Securities Templeton Growth Securities
Fund - Class 1 - Xxxxxxxxx Fund - Class 1
Global Advisors Limited Xxxxxxxxx Global Advisors
Limited
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 4 CONTRACT 5 CONTRACT 6
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME CVUL Lincoln SVUL VUL(DB)
CVUL III
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-72875 333-43107 333-82663
REPRESENTATIVE FORM LN920 LN650 LN680
NUMBERS LN921
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account S Variable Life Account R Variable Life Account M
11/1/98 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-09241 811-08579 811-08557
PORTFOLIOS AND CLASSES Templeton Asset Strategy Fund Xxxxxxxxx International Xxxxxxxxx International
-ADVISER - Class 2 - Templeton Global Securities Fund - Class 2 - Securities Fund - Class 2 -
Advisors Limited Xxxxxxxxx Investment Counsel, Xxxxxxxxx Investment Counsel,
Inc. Inc.
Xxxxxxxxx International
Securities Fund - Class 2 - Templeton Growth Securities Templeton Growth Securities
Xxxxxxxxx Investment Counsel, Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Templeton
Inc. Global Advisors Limited Global Advisors Limited
Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited
Franklin Small Cap Fund -
Class 2 - Franklin Advisers,
Inc.
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 7 CONTRACT 8 CONTRACT 9
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Lincoln ChoicePlus Variable Lincoln ChoicePlus Access Lincoln ChoicePlus Bonus
Annuity Variable Annuity Variable Annuity
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-40937 333-36316 333-36304
REPRESENTATIVE FORM AN425LL 30296 30295
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Variable Annuity Lincoln Life Variable
NAME/DATE ESTABLISHED Account N Account N Annuity Account N
11/3/97 11/3/97 11/3/97
SEC REGISTRATION NUMBER 811-08517 811-08517 811-08517
PORTFOLIOS AND CLASSES Xxxxxxxxx International Xxxxxxxxx International Xxxxxxxxx International
-ADVISER Securities Fund - Class 2 Securities Fund - Class 2 Securities Fund - Class 2
-Xxxxxxxxx Investment -Xxxxxxxxx Investment Counsel, -Xxxxxxxxx Investment
Counsel, Inc. Inc. Counsel, Inc.
Mutual Shares Securities Fund Mutual Shares Securities Fund Mutual Shares Securities Fund
- Class 2 - Franklin Mutual - Class 2 - Franklin Mutual - Class 2 - Franklin Mutual
Advisers, LLC Advisers, LLC Advisers, LLC
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
Class 2 - Franklin Advisers, Class 2 - Franklin Advisers, Class 2 - Franklin Advisers,
Inc. Inc. Inc.
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 10 CONTRACT 11 CONTRACT 12
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Lincoln MoneyGuard VUL VUL(CV) VUL(CV2)
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER [333-_____] 333-42479 333-54338
REPRESENTATIVE FORM LN660 LN665
NUMBERS
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account M Variable Life Account M Variable Life Account M
12/2/97 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-08557 811-08557 811-08557
PORTFOLIOS AND CLASSES Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
-ADVISER Class 1 -Franklin Advisers, Class 1 -Franklin Advisers, Class 1 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 1 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 1 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
Xxxxxxxxx International
Securities Fund - Class 1 -
Gempleton Investment Counsel,
Inc.
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 13 CONTRACT 14 CONTRACT 15
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME MultiFund Individual GVA I, II, III Choice Plus II
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 33-25990 333-05827 333-40937
REPRESENTATIVE FORM 18829 GAC96-101 30070-B
NUMBERS 25982
28645
SEPARATE ACCOUNT Lincoln National Variable Lincoln National Variable Lincoln Life Variable Annuity
NAME/DATE ESTABLISHED Annuit Account C Annuity Account L Account N
6/3/81 4/29/96 11/3/97
SEC REGISTRATION NUMBER 811-03214 811-07645 811-08517
PORTFOLIOS AND CLASSES Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
-ADVISER Class 2 -Franklin Advisers, Class 2 -Franklin Advisers, Class 2 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 16 CONTRACT 17 CONTRACT 18
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME ChoicePlus II Access ChoicePlus II Bonus ChoicePlus II Advance
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-36316 333-36304 333-61554
REPRESENTATIVE FORM 30070-B 30070-B 30070-B
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Variable Annuity Lincoln Life Variable Annuity
NAME/DATE ESTABLISHED Account N Account N Account N
SEC REGISTRATION NUMBER 811-08517 811-08517 811-08517
PORTFOLIOS AND CLASSES Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
-ADVISER Class 2 -Franklin Advisers, Class 2 -Franklin Advisers, Class 2 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 19 CONTRACT 20 CONTRACT 21
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME MultiFund Group SVUL II Director(TM)
REGISTERED (Y/N) Yes Yes No
SEC REGISTRATION NUMBER 333-43373 333-33782 NA
REPRESENTATIVE FORM 28883 LN655 19476
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Flexible Premium Lincoln National Life
NAME/DATE ESTABLISHED Account Q Variable Life Separate Account Insurance Company Separate
11/3/97 R Account 62
12/2/97
SEC REGISTRATION NUMBER 811-08569 811-08579 NA
PORTFOLIOS AND CLASSES Franklin Small Cap Fund - Franklin Small Cap Fund - Templeton Growth Securities
-ADVISER Class 2 -Franklin Advisers, Class 2 -Franklin Advisers, Fund - Class 2
Inc. Inc.
Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited
SCHEDULE D (CONT.)
CONTRACTS OF THE COMPANY
----------------------------------------------------------------------------------------------------------------------------
CONTRACT 22
----------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Director(TM)
REGISTERED (Y/N) No
SEC REGISTRATION NUMBER NA
REPRESENTATIVE FORM 19476
NUMBERS
SEPARATE ACCOUNT Lincoln National Life
NAME/DATE ESTABLISHED Insurance Company Separate
Account 63
SEC REGISTRATION NUMBER NA
PORTFOLIOS AND CLASSES Franklin Small Cap Fund -
-ADVISER Class 2
AMENDMENT TO
PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
The participation agreement, dated as of May 1, 2000, by and among Franklin
Xxxxxxxxx Variable Insurance Products Trust, Franklin Xxxxxxxxx Distributors,
Inc. and The Lincoln National Life Insurance Company (the "Agreement") is hereby
amended as follows:
Section 3.11 is hereby added as follows:
3.11 Each party to this Agreement agrees that, in the event of a
material error resulting from incorrect information or confirmations,
the parties will seek to comply in all material respects with the
provisions of applicable federal securities laws.
Schedule D of the Agreement is hereby deleted in its entirety and replaced
with the Schedule D attached hereto.
All other terms and provisions of the Agreement not amended herein shall remain
in full force and effect.
Effective Date as of August 1, 2002.
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxx Xxxxxx
---------------------------- ---------------------
Name: Xxxxx X. Xxxxxxxx Name: Xxxxxx Xxxxxx
Title: Assistant Vice President Title: Vice President
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Second Vice President
SCHEDULE D
CONTRACTS OF THE COMPANY
CONTRACT 1 CONTRACT 2 CONTRACT 3
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME SVUL I VUL I Lincoln VUL cv
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-43107 333-42479 333-42479
REPRESENTATIVE FORM LN650LL LN605LL LN660
NUMBERS LN615 LN615
LN660 LN605
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account R Variable Life Account M Separate Account M
12/2/97 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-08579 811-08557 811-08557
PORTFOLIOS AND Templeton Global Asset Templeton Global Asset Templeton Foreign Securities
CLASSES-ADVISER Allocation Fund - Class 1 Allocation Fund - Class 1 Fund - Class 2 - Templeton
Xxxxxxxxx Global Advisors Xxxxxxxxx Global Advisors Investment Counsel, Inc.
Limited Limited
Templeton Foreign Securities Templeton Foreign Securities Templeton Growth Securities
Fund - Class 1- Xxxxxxxxx Fund - Class 1 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Investment Counsel, Inc. Investment Counsel, Inc. Global Advisors Limited
Templeton Growth Securities Templeton Growth Securities Franklin Small Cap Fund -
Fund - Class 1 - Xxxxxxxxx Fund - Class 1 Class 1 - Franklin Advisors,
Global Advisors Limited Xxxxxxxxx Global Advisors Inc.
Limited
CONTRACT 4 CONTRACT 5 CONTRACT 6
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME CVUL Lincoln SVUL VUL(DB)
CVUL III
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-72875 333-43107 333-82663
REPRESENTATIVE FORM LN920 LN650 LN680
NUMBERS LN921
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account S Variable Life Account R Variable Life Account M
11/1/98 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-09241 811-08579 811-08557
PORTFOLIOS AND Templeton Global Asset Templeton Foreign Securities Templeton Foreign Securities
CLASSES -ADVISER Allocation Fund - Class 2 - Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Templeton
Xxxxxxxxx Global Advisors Investment Counsel, Inc. Investment Counsel, Inc.
Limited
Templeton Foreign Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Investment Counsel, Inc. Global Advisors Limited Global Advisors Limited
Templeton Growth Securities Franklin Small Cap Fund - Franklin Small Cap Fund -
Fund - Class 2 - Templeton Class 1 - Franklin Advisers, Class 1 - Franklin Advisers,
Global Advisors Limited Inc. Inc.
Franklin Small Cap Fund -
Class 2 - Franklin Advisers,
Inc.
CONTRACT 7 CONTRACT 8 CONTRACT 9
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Lincoln ChoicePlus Variable Lincoln ChoicePlus Access Lincoln ChoicePlus Bonus
Annuity Variable Annuity Variable Annuity
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-40937 333-36316 333-36304
REPRESENTATIVE FORM AN425LL 30296 30295
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Variable Annuity Lincoln Life Variable
NAME/DATE ESTABLISHED Account N Account N Annuity Account N
11/3/97 11/3/97 11/3/97
SEC REGISTRATION NUMBER 811-08517 811-08517 811-08517
PORTFOLIOS AND Xxxxxxxxx Foreign Securities Templeton Foreign Securities Templeton Foreign Securities
CLASSES-ADVISER Fund - Class 2 -Xxxxxxxxx Fund - Class 2 -Xxxxxxxxx Fund - Class 2 -Xxxxxxxxx
Investment Counsel, Inc. Investment Counsel, Inc. Investment Counsel, Inc.
Mutual Shares Securities Fund Mutual Shares Securities Fund Mutual Shares Securities Fund
- Class 2 - Franklin Mutual - Class 2 - Franklin Mutual - Class 2 - Franklin Mutual
Advisers, LLC Advisers, LLC Advisers, LLC
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
Class 2 - Franklin Advisers, Class 2 - Franklin Advisers, Class 2 - Franklin Advisers,
Inc. Inc. Inc.
CONTRACT 10 CONTRACT 11 CONTRACT 12
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Lincoln MoneyGuard VUL VUL(CV2) VUL(CV2)
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-63940 333-54338 333-54338
REPRESENTATIVE FORM LN665 LN665
NUMBERS
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account M Variable Life Account M Variable Life Account M
12/2/97 12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-08557 811-08557 811-08557
PORTFOLIOS AND CLASSES Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
-ADVISER Class 1 -Franklin Advisers, Class 1 -Franklin Advisers, Class 1 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 1 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 1 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
Templeton Foreign
Securities Fund -
Class 2 - Xxxxxxxxx
Investment Counsel,
Inc.
CONTRACT 13 CONTRACT 14 CONTRACT 15
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME MultiFund Individual GVA I, II, III Choice Plus II
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 33-25990 333-05827 333-40937
REPRESENTATIVE FORM 18829 GAC96-101 30070-B
NUMBERS 25982
28645
SEPARATE ACCOUNT Lincoln National Variable Lincoln National Variable Lincoln Life Variable Annuity
NAME/DATE ESTABLISHED Annuit Account C Annuity Account L Account N
6/3/81 4/29/96 11/3/97
SEC REGISTRATION NUMBER 811-03214 811-07645 811-08517
PORTFOLIOS AND Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
CLASSES-ADVISER Class 2 -Franklin Advisers, Class 2 -Franklin Advisers, Class 2 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
CONTRACT 16 CONTRACT 17 CONTRACT 18
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME ChoicePlus II Access ChoicePlus II Bonus ChoicePlus II Advance
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-36316 333-36304 333-61554
REPRESENTATIVE FORM 30070-B 30070-B 30070-B
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Annuity Lincoln Life Variable Annuity Lincoln Life Variable Annuity
NAME/DATE ESTABLISHED Account N Account N Account N
SEC REGISTRATION NUMBER 811-08517 811-08517 811-08517
PORTFOLIOS AND Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
CLASSES-ADVISER Class 2 -Franklin Advisers, Class 2 -Franklin Advisers, Class 2 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
CONTRACT 19 CONTRACT 20 CONTRACT 21
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME MultiFund Group SVUL II Director(TM)
REGISTERED (Y/N) Yes Yes No
SEC REGISTRATION NUMBER 333-43373 333-33782 NA
REPRESENTATIVE FORM 28883 LN655 19476
NUMBERS
SEPARATE ACCOUNT Lincoln Life Variable Lincoln Life Flexible Premium Lincoln National Life
NAME/DATE ESTABLISHED Annuity Account Q Variable Life Separate Insurance Company Separate
11/3/97 Account R Account 62
12/2/97
SEC REGISTRATION NUMBER 811-08569 811-08579 NA
PORTFOLIOS AND Franklin Small Cap Fund - Franklin Small Cap Fund - Templeton Growth Securities
CLASSES -ADVISER Class 2 -Franklin Advisers, Class 1 -Franklin Advisers, Fund - Class 2
Inc. Inc.
Templeton Growth Securities Templeton Growth Securities
Fund - Class 2 - Xxxxxxxxx Fund - Class 2 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited
Templeton Foreign Securities
Fund - Class 2 - Xxxxxxxxx
Investment Counsel, Inc.
CONTRACT 22 CONTRACT 23 CONTRACT 24
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME Director(TM) CVUL III (Elite Funds) VUL(DB)
REGISTERED (Y/N) No Yes Yes
SEC REGISTRATION NUMBER NA 333-72875 333-82663
REPRESENTATIVE FORM 19476 LN920 LN680
NUMBERS LN921
SEPARATE ACCOUNT Lincoln National Life Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Insurance Company Separate Variable Life Account S Variable Life Account M
Account 63 11/1/98 12/2/97
SEC REGISTRATION NUMBER NA 811-09241 811-08557
PORTFOLIOS AND Franklin Small Cap Fund - Templeton Growth Securities Templeton Growth Securities
CLASSES-ADVISER Class 2 Fund - Class 1- Xxxxxxxxx Fund - Class 1- Xxxxxxxxx
Global Advisors Limited Global Advisors Limited
Franklin Small Cap Fund - Franklin Small Cap Fund -
Class 1 - Franklin Advisers, Class 1 - Franklin Advisers,
Inc. Inc
CONTRACT 25 CONTRACT 26 CONTRACT 27
------------------------------------------------------------------------------------------------------------------------------------
CONTRACT/PRODUCT NAME SVUL II (Elite Funds) SVUL III VULcv III
REGISTERED (Y/N) Yes Yes Yes
SEC REGISTRATION NUMBER 333-33782 333-90432 333-84370
REPRESENTATIVE FORM LN655 LN656 LN670
NUMBERS
SEPARATE ACCOUNT Lincoln Life Flexible Premium Lincoln Life Flexible Premium Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Separate Variable Life Separate Variable Life Account M
Account R Account R 12/2/97
12/2/97 12/2/97
SEC REGISTRATION NUMBER 811-08579 811-08579 811-08557
PORTFOLIOS AND Franklin Small Cap Fund - Franklin Small Cap Fund - Franklin Small Cap Fund -
CLASSES-ADVISER Class 1 -Franklin Advisers, Class 1 -Franklin Advisers, Class 1 -Franklin Advisers,
Inc. Inc. Inc.
Templeton Growth Securities Templeton Growth Securities Templeton Growth Securities
Fund - Class 1 - Xxxxxxxxx Fund - Class 1 - Xxxxxxxxx Fund - Class 1 - Xxxxxxxxx
Global Advisors Limited Global Advisors Limited Global Advisors Limited
CONTRACT 28
------------------------------------------------------------
CONTRACT/PRODUCT NAME VULdb II
REGISTERED (Y/N) Yes
SEC REGISTRATION NUMBER 333-84360
REPRESENTATIVE FORM LN690
NUMBERS
SEPARATE ACCOUNT Lincoln Life Flexible Premium
NAME/DATE ESTABLISHED Variable Life Account M
12/2/97
SEC REGISTRATION NUMBER 811-08557
PORTFOLIOS AND Franklin Small Cap Fund -
CLASSES-ADVISER Class 1 -Franklin Advisers,
Inc.
Templeton Growth Securities
Fund - Class 1 - Xxxxxxxxx
Global Advisors Limited
FORM OF
AMENDMENT NO. 3 TO PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
[name of insurance company distributor]
The participation agreement, dated as of May 1, 2000 by and among Franklin
Xxxxxxxxx Variable Insurance Products Trust, Franklin Xxxxxxxxx Distributors,
Inc. and The Lincoln National Life Insurance Company (the "Agreement"), is
hereby amended as follows:
1. [name of insurance company distributor] is added as a party to the
Agreement.
2. The following Section 2.1.12 is added to the Agreement:
"2.1.12 As covered financial institutions we, only with respect to
Portfolio shareholders, and you each undertake and agree to comply, and to
take full responsibility in complying with any and all applicable laws,
regulations, protocols and other requirements relating to money laundering
including, without limitation, the International Money Laundering Abatement
and Anti-Terrorist Financing Act of 2001 (Title III of the USA PATRIOT
Act)."
3. The following paragraphs of Section 3 are hereby deleted in their entirety
and replaced with the following paragraphs:
"3.1 We will make shares of the Portfolios available to the Accounts
for the benefit of the Contracts. The shares will be available for purchase
at the net asset value per share next computed after we (or our agent)
receive a purchase order, as established in accordance with the provisions
of the then current prospectus of the Trust. Notwithstanding the foregoing,
the Trust's Board of Trustees ("Trustees") may refuse to sell shares of any
Portfolio to any person, or may suspend or terminate the offering of shares
of any Portfolio if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the
Trustees, they deem such action to be in the best interests of the
shareholders of such Portfolio. Without limiting the foregoing, the
Trustees have determined that there is a significant risk that the Trust
and its shareholders may be adversely affected by investors with short term
trading activity and/or whose purchase and redemption activity follows a
market timing pattern as defined in the prospectus for the Trust, and have
authorized the Trust, the Underwriter and the Trust's transfer agent to
adopt procedures and take other action (including, without limitation,
rejecting specific purchase orders) as they deem necessary to reduce,
discourage or eliminate such trading and/or market timing activity. You
agree to cooperate with us to assist us in implementing the Trust's
restrictions on excessive and/or short term trading activity and/or
purchase and redemption activity that follows a market timing pattern.
1
3.4 You are hereby appointed as our designee for the sole purpose of
receiving from Contract owners purchase and exchange orders and requests
for redemption resulting from investment in and payments under the
Contracts that pertain to subaccounts that invest in Portfolios
("Instructions"). "Business Day" shall mean any day on which the New York
Stock Exchange is open for trading and on which the Trust calculates its
net asset value pursuant to the rules of the SEC and its current
prospectus. "Close of Trading" shall mean the close of trading on the New
York Stock Exchange, generally 4:00 p.m. eastern time. You represent and
warrant that all Instructions transmitted to us for processing on or as of
a given Business Day ("Day 1") shall have been received in proper form and
time stamped by you prior to the Close of Trading on Day 1, provided that
we receive such Instructions from you before 9 a.m. Eastern Time on the
next Business Day ("Day 2"). Such Instructions shall receive the share
price next calculated following the Close of Trading on Day 1. You
represent and warrant that Instructions received in proper form and time
stamped by you after the Close of Trading on Day 1 shall be treated by you
and transmitted to us as if received on Day 2. Such Instructions shall
receive the share price next calculated following the Close of Trading on
Day 2. You represent and warrant that you have and will maintain systems in
place reasonably designed to prevent Instructions received after the Close
of Trading on Day 1 from being executed with Instructions received before
the Close of Trading on Day 1. All Instructions we receive from you after 9
a.m. Eastern Time on Day 2 shall be processed by us on the following
Business Day and shall receive the share price next calculated following
the Close of Trading on Day 2."
4. Section 9 of the Agreement is hereby deleted in its entirety and replaced
with the following Section 9:
"9. TERMINATION
9.1 This Agreement may be terminated by mutual agreement at any time.
If this Agreement is so terminated, we shall, at your option, continue to
make available additional shares of any Portfolio and redeem shares of any
Portfolio for any or all Contracts or Accounts existing on the effective
date of termination of this Agreement, pursuant to the terms and conditions
of this Agreement.
9.2 This Agreement may be terminated by any party in its entirety or
with respect to one, some or all Portfolios for any reason by sixty (60)
days' advance written notice delivered to the other parties. If this
Agreement is so terminated, we may, at our option, continue to make
available additional shares of any Portfolio and redeem shares of any
Portfolio for any or all Contracts or Accounts existing on the effective
date of termination of this Agreement, pursuant to the terms and conditions
of this Agreement; alternatively, we may, at our option, redeem the
Portfolio shares held by the Accounts, PROVIDED that such redemption shall
not occur prior to six (6) months following written notice of termination,
during which time we will cooperate with you in effecting a transfer of
Portfolio assets to another underlying fund pursuant to any legal and
appropriate means.
2
9.3 This Agreement may be terminated immediately by us upon written
notice to you if you materially breach any of the representations and
warranties made in this Agreement or you are materially in default in the
performance of any of your duties or obligations under the Agreement,
receive a written notice thereof and fail to remedy such default or breach
to our reasonable satisfaction within 30 days after such notice. If this
Agreement so terminates, the parties shall cooperate to effect an orderly
windup of the business which may include, at our option, a redemption of
the Portfolio shares held by the Accounts, PROVIDED that such redemption
shall not occur prior to a period of up to six (6) months following written
notice of termination, during which time we will cooperate reasonably with
you in effecting a transfer of Portfolio assets to another underlying fund
pursuant to any legal and appropriate means.
9.4 This Agreement may be terminated immediately by us upon written
notice to you if, with respect to the representations and warranties made
in sections 2.1.3, 2.1.5, 2.1.7 and 2.1.12 of this Agreement: (i) you
materially breach any of such representations and warranties; or (ii) you
inform us that any of such representations and warranties may no longer be
true or might not be true in the future; or (iii) any of such
representations and warranties were not true on the effective date of this
Agreement, are at any time no longer true, or have not been true during any
time since the effective date of this Agreement. If this Agreement is so
terminated, the Trust may redeem, at its option in kind or for cash, the
Portfolio shares held by the Accounts on the effective date of termination
of this Agreement.
9.5 This Agreement may be terminated by the Board of Trustees of the
Trust, in the exercise of its fiduciary duties, either upon its
determination that such termination is a necessary and appropriate remedy
for a material breach of this Agreement which includes a violation of laws,
or upon its determination to completely liquidate a Portfolio. Pursuant to
such termination, the Trust may redeem, at its option in kind or for cash,
the Portfolio shares held by the Accounts on the effective date of
termination of this Agreement;
9.6 This Agreement shall terminate immediately in the event of its
assignment by any party without the prior written approval of the other
parties, or as otherwise required by law. If this Agreement is so
terminated, the Trust may redeem, at its option in kind or for cash, the
Portfolio shares held by the Accounts on the effective date of termination
of this Agreement.
9.7 This Agreement shall be terminated as required by the Shared
Funding Order, and its provisions shall govern.
9.8 The provisions of Sections 2 (Representations and Warranties) and
7 (Indemnification) shall survive the termination of this Agreement. All
other applicable provisions of this Agreement shall survive the termination
of this Agreement, as long as shares of the Trust are held on behalf of
Contract owners, except that we shall have no further obligation to sell
Trust shares with respect to Contracts issued after termination.
3
9.9 You shall not redeem Trust shares attributable to the Contracts
(as opposed to Trust shares attributable to your assets held in the
Account) except: (i) as necessary to implement Contract owner initiated or
approved transactions; (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"); or (iii) as
permitted by an order of the SEC pursuant to Section 26(b) of the 1940 Act.
Upon request, you shall promptly furnish to us the opinion of your counsel
(which counsel shall be reasonably satisfactory to us) to the effect that
any redemption pursuant to clause (ii) of this Section 9.9 is a Legally
Required Redemption. Furthermore, you shall not prevent Contract owners
from allocating payments to any Portfolio that has been available under a
Contract without first giving us ninety (90) days advance written notice of
your intention to do so."
5. The following Section 10.13 is added to the Agreement:
"10.13 We and you both agree that: (a) if the Trustees approve a
revision of Section 3 of the form of Participation Agreement used by the
Trust for the purpose of clarifying procedures and responsibilities
regarding purchase and redemption of Portfolio shares to address recent
regulatory concerns regarding late trading and market timing activity (the
"Form"), then we and you will both negotiate in good faith and execute an
amendment to Section 3 of this Agreement to achieve the purposes intended
by such revision of the Form ("Amendment"); and (b) if an Amendment is not
completed and fully executed by you and us by six months after the
Trustees' approval of the revised Form, then this Agreement will terminate
immediately at that time, notwithstanding any other termination provisions
in this Agreement, and such termination shall be considered a termination
by mutual agreement pursuant to Section 9.1 of this Agreement."
6. Schedules A, B, C, D, F and G of the Agreement are hereby deleted in their
entirety and replaced with the Schedules A, B, C, D, F and G attached
hereto, respectively.
All other terms and provisions of the Agreement not amended herein shall remain
in full force and effect.
Effective Date as of May 1, 2003.
FRANKLIN XXXXXXXXX VARIABLE THE LINCOLN NATIONAL LIFE INSURANCE
INSURANCE PRODUCTS TRUST COMPANY
By: By:
---------------------------------- ----------------------------------
Name: Xxxxx X. Xxxxxxxx Name: Rise X.X. Xxxxxx
Title: Assistant Vice President Title: Vice President
4
FRANKLIN XXXXXXXXX DISTRIBUTORS, [NAME OF INSURANCE COMPANY DISTRIBUTOR]
INC.
By: By:
---------------------------------- ----------------------------------
Name: Xxxxxx X. Xxxxxx Name:
Title: Vice President Title:
5
SCHEDULE A
THE COMPANY AND ITS DISTRIBUTOR
THE COMPANY
The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
A life insurance company incorporated in the State of Indiana
ITS DISTRIBUTOR
[Name of Distributor]
Address ____________
______________________
A corporation organized under the laws of state of _________________.
A
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Lincoln Life Flexible Premium Variable Life
Account R
Date Established: December 2, 1997
SEC Registration Number: 811-08579
2. Name: Lincoln Life Flexible Premium Variable Life
Account M
Date Established: December 2, 1997
SEC Registration Number: 811-08557
3. Name: Lincoln Life Flexible Premium Variable Life
Account S
Date Established: November 1, 1998
SEC Registration Number: 811-09241
4. Name: Lincoln Life Flexible Premium Variable Life
Account Z
Date Established: July 30, 2003
SEC Registration Number: _____________
5. Name:
Lincoln Life Variable Annuity Account N
Date Established: November 3, 1997
SEC Registration Number: 811-08517
6. Name: Lincoln Life Variable Annuity Account Q
Date Established: November 3, 1997
SEC Registration Number: 811-08569
7. Name: Lincoln National Life Insurance Company
Separate Account 62
Date Established: ____________
SEC Registration Number: Not registered
8. Name: Lincoln National Life Insurance Company
Separate Account 63
Date Established: ____________
SEC Registration Number: Not registered
9. Name: Lincoln National Variable Annuity Account C
Date Established: June 3, 1981
SEC Registration Number: 811-03214
10. Name: Lincoln National Variable Annuity Account L
Date Established: April 29, 1996
SEC Registration Number: 811-07645
B
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
---------------------------------------------------- ------------------
Franklin Small Cap Fund, Class 2 Franklin Advisers, Inc.
Templeton Foreign Securities Fund, Classes 1 and 2 Xxxxxxxxx Investment Counsel,
LLC
Templeton Global Asset Allocation Fund, Classes 1 Xxxxxxxxx Investment Counsel,
and 2 LLC
Templeton Growth Securities Fund, Classes 1 and 2 Xxxxxxxxx Global Advisors Ltd.
C
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
REGISTERED Y/N REGISTRATION DATE
# 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------
1 SVUL I Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account R Xxxxxxxxx Foreign Securities Fund
333-43107 December 2, 1997 Templeton Global Asset Allocation Fund
LN650LL 811-08579 Templeton Growth Securities Fund
2 VUL I Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Xxxxxxxxx Foreign Securities Fund
333-42479 December 2, 1997 Templeton Global Asset Allocation Fund
LN605LL 811-08557 Templeton Growth Securities Fund
LN615
3 Lincoln VUL cv Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-42479 December 2, 1997
LN660 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
4 CVUL Lincoln Life Flexible Premium CLASS 2 SHARES:
Yes Variable Life Account S Franklin Small Cap Fund
333-72875 November 1, 1998 Xxxxxxxxx Foreign Securities Fund
LN920 811-09241 Templeton Global Asset Allocation Fund
LN921 Templeton Growth Securities Fund
5 Lincoln SVUL Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account R Franklin Small Cap Fund
333-43107 December 2, 1997
LN650 811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
6 VUL(DB) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-82663 December 2, 1997
LN680 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
7 Lincoln ChoicePlus Variable Lincoln Life Variable Annuity CLASS 2 SHARES:
Annuity Account N Franklin Small Cap Fund
Yes November 3, 1997
333-40937 811-08517 Templeton Growth Securities Fund
AN425LL
D-1
PRODUCT NAME SEPARATE ACCOUNT NAME
REGISTERED Y/N REGISTRATION DATE
# 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------
8 Lincoln ChoicePlus Access Lincoln Life Variable Annuity CLASS 2 SHARES:
Variable Annuity Account N Franklin Small Cap Fund
Yes November 3, 1997
333-36316 811-08517 Templeton Growth Securities Fund
30296
9 Lincoln ChoicePlus Bonus Lincoln Life Variable Annuity CLASS 2 SHARES:
Variable Annuity Account N Franklin Small Cap Fund
Yes November 3, 1997
333-36304 811-08517 Templeton Growth Securities Fund
30295
10 Lincoln MoneyGuard VUL Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-63940 December 2, 1997 Templeton Growth Securities Fund
________ 811-08557
11 VUL(CV2) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-54338 December 2, 1997
LN665 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
12 VUL(CV2) (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-54338 December 2, 1997 Templeton Growth Securities Fund
LN665 811-08557
13 MultiFund Individual Lincoln National Variable CLASS 2 SHARES:
Yes Annuity Account C Franklin Small Cap Fund
33-25990 June 3, 1981 Templeton Growth Securities Fund
18829 811-03214
25982
28645
14 GVA I, II, III Lincoln National Variable CLASS 2 SHARES:
Yes Annuity Account L Franklin Small Cap Fund
333-05827 April 29, 1996 Templeton Growth Securities Fund
GAC96-101 811-07645
15 Choice Plus II Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-40937 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
16 ChoicePlus II Access Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-36316 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
D-2
PRODUCT NAME SEPARATE ACCOUNT NAME
REGISTERED Y/N REGISTRATION DATE
# 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------
17 ChoicePlus II Bonus Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-36304 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
18 ChoicePlus II Advance Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-61554 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
19 MultiFund Group Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account Q Franklin Small Cap Fund
333-43373 November 3, 1997 Templeton Growth Securities Fund
28883 811-08569
20 SVUL II Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account R Franklin Small Cap Fund
333-33782 December 2, 1997
LN655 811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
21 Director (TM) Lincoln National Life Insurance CLASS 2 SHARES:
No Copany Separate Account 62 Templeton Growth Securities Fund
N/A N/A
19476
22 Director (TM) Lincoln National Life Insurance CLASS 2 SHARES:
No Copany Separate Account 63 Franklin Small Cap Fund
N/A N/A
19476
23 CVUL III (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account S Franklin Small Cap Fund
333-72875 November 1, 1998 Templeton Growth Securities Fund
LN925 811-09241
LN926
24 VUL(DB) (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-82633 December 2, 1997 Templeton Growth Securities Fund
LN680 811-08557
25 SVUL II (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account R Franklin Small Cap Fund
333-33782 December 2, 1997 Templeton Growth Securities Fund
LN655 811-08579
26 SVUL III Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account R Franklin Small Cap Fund
333-90432 December 2, 1997 Templeton Growth Securities Fund
LN656 811-08579
D-3
PRODUCT NAME SEPARATE ACCOUNT NAME
REGISTERED Y/N REGISTRATION DATE
# 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------
27 VUL(CV) III Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-84370 December 2, 1997 Templeton Growth Securities Fund
LN670 811-08557
28 VULdb II Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account M Franklin Small Cap Fund
333-84360 December 2, 1997 Templeton Growth Securities Fund
LN690 811-08557
29 ChoicePlus Assurance (B Lincoln Life Variable Annuity CLASS 2 SHARES:
Shares) Account N Franklin Small Cap Fund
Yes November 3, 1997 Templeton Growth Securities Fund
333-40937 811-08517
30070-B
30 ChoicePlus Assurance C Share) Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-36316 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
31 ChoicePlus Assurance (L Share) Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-61554 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
32 ChoicePlus Assurance (Bonus) Lincoln Life Variable Annuity CLASS 2 SHARES:
Yes Account N Franklin Small Cap Fund
333-36304 November 3, 1997 Templeton Growth Securities Fund
30070-B 811-08517
33 LCV4 Lincoln Life Flexible Premium CLASS 1 SHARES:
Yes Variable Life Account S Franklin Small Cap Fund
333-104719 November 1, 1998 Templeton Growth Securities Fund
LN935 811-09241
34 CVUL III Lincoln Life Flexible Premium CLASS 2 SHARES:
Yes Variable Life Account S Franklin Small Cap Fund
333-72875 November 1, 1998 Xxxxxxxxx Foreign Securities Fund
LN925 811-09241 Templeton Global Asset Allocation Fund
LN926 Templeton Growth Securities Fund
35 Lincoln Corporate Variable Lincoln Life Flexible Premium CLASS 2 SHARES:
Private Solutions Variable Life Account Z Franklin Small Cap Fund
Yes July 30, 2003 Templeton Growth Securities Fund
________ ________
LN930
D-4
SCHEDULE F
RULE 12b-1 PLANS OF THE TRUST
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
PORTFOLIO NAME MAXIMUM ANNUAL PAYMENT RATE
-------------- ---------------------------
Franklin Small Cap Fund 0.25%
Xxxxxxxxx Foreign Securities Fund 0.25%
Templeton Global Asset Allocation Fund 0.25%
Templeton Growth Securities Fund 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees
(collectively "you") provide any activity or service which is primarily intended
to assist in the promotion, distribution or account servicing of Eligible Shares
("Rule 12b-1 Services") or variable contracts offering Eligible Shares, the
Underwriter, the Trust or their affiliates (collectively, "we") may pay you a
Rule 12b-1 fee. "Rule 12b-1 Services" may include, but are not limited to,
printing of prospectuses and reports used for sales purposes, preparing and
distributing sales literature and related expenses, advertisements, education of
dealers and their representatives, and similar distribution-related expenses,
furnishing personal services to owners of Contracts which may invest in Eligible
Shares ("Contract Owners"), education of Contract Owners, answering routine
inquiries regarding a Portfolio, coordinating responses to Contract Owner
inquiries regarding the Portfolios, maintaining such accounts or providing such
other enhanced services as a Trust Portfolio or Contract may require, or
providing other services eligible for service fees as defined under NASD rules.
Your acceptance of such compensation is your acknowledgment that eligible
services have been rendered. All Rule 12b-1 fees, shall be based on the value of
Eligible Shares owned by the Company on behalf of its Accounts, and shall be
calculated on the basis and at the rates set forth in the Compensation Schedule
stated above. The aggregate annual fees paid pursuant to each Plan shall not
exceed the amounts stated as the "annual maximums" in the Portfolio's
prospectus, unless an increase is approved by shareholders as provided in the
Plan. These maximums shall be a specified percent of the value of a Portfolio's
net assets attributable to Eligible Shares owned by the Company on behalf of its
Accounts (determined in the same manner as the Portfolio uses to compute its net
assets as set forth in its effective Prospectus). The Rule 12b-1 fee will be
paid to you within thirty (30) days after the end of the three-month periods
ending in January, April, July and October.
F-1
You shall furnish us with such information as shall reasonably be requested
by the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1
fees paid to you pursuant to the Plans. We shall furnish to the Trustees, for
their review on a quarterly basis, a written report of the amounts expended
under the Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
F-2
SCHEDULE G
ADDRESSES FOR NOTICES
To the Company: The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
To the Distributor [Name of Distributor]
Address ____________
_______________________
Attention: __________
To the Trust: Franklin Xxxxxxxxx Variable Insurance Products Trust
Xxx Xxxxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Assistant Vice President
To the Underwriter: Franklin Xxxxxxxxx Distributors, Inc.
Xxx Xxxxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Vice President
G
AMENDMENT NO. 3 TO PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us") and The Lincoln National Life Insurance Company ("you"),
have previously entered into a Participation Agreement dated May 1, 2000 (the
"Agreement"). The parties now desire to amend the Agreement in this amendment
(the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement
shall remain in full force and effect. Unless otherwise indicated, the terms
defined in the Agreement shall have the same meaning in this Amendment.
A M E N D M E N T
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 2.1.6 of the Agreement is hereby amended to add the following
sentence at the end of the section:
"Without limiting the foregoing, you agree that in recommending to a
Contract owner the purchase, sale or exchange of any subaccount units under
the Contracts, you shall have reasonable grounds, based on representations
from the broker/dealers in their signed agreements with you, for believing
that the recommendation is suitable for such Contract owner."
2. A new Section 2.1.12 is hereby added to the Agreement as follows:
"2.1.12 As covered financial institutions we, only with respect to
Portfolio shareholders, and you each undertake and agree to comply, and to
take full responsibility in complying with any and all applicable laws,
regulations, protocols and other requirements relating to money laundering
including, without limitation, the International Money Laundering Abatement
and Anti-Terrorist Financing Act of 2001 (Title III of the USA PATRIOT
Act)."
3. A new Section 2.1.13 is hereby added to the Agreement as follows:
"2.1.13 You represent that you are also the principal underwriter for
each of the Contracts, are registered as a broker-dealer pursuant to the
Securities Exchange Act of 1934,
1
and that you will comply in all material respects with the 1933 and 1940
Acts and the rules and regulations thereunder."
4. Section 3 of the Agreement is hereby deleted in its entirety and replaced
with the following Section 3:
"3. PURCHASE AND REDEMPTION OF TRUST PORTFOLIO SHARES
3.1 AVAILABILITY OF TRUST PORTFOLIO SHARES
3.1.1 We will make shares of the Portfolios available to the
Accounts for the benefit of the Contracts. The shares will be available for
purchase at the net asset value per share next computed after we (or our
agent, or you as our designee) receive a purchase order, as established in
accordance with the provisions of the then current prospectus of the Trust.
All orders are subject to acceptance by us and by the Portfolio or its
transfer agent, and become effective only upon confirmation by us.
Notwithstanding the foregoing, the Trust's Board of Trustees ("Trustees")
may refuse to sell shares of any Portfolio to any person, or may suspend or
terminate the offering of shares of any Portfolio if such action is
required by law or by regulatory authorities having jurisdiction or if, in
the sole discretion of the Trustees, they deem such action to be in the
best interests of the shareholders of such Portfolio.
3.1.2 Without limiting the other provisions of this Section
3.1, among other delegations by the Trustees, the Trustees have determined
that there is a significant risk that the Trust and its shareholders may be
adversely affected by investors with short term trading activity and/or
whose purchase and redemption activity follows a market timing pattern as
defined in the prospectus for the Trust, and have authorized the Trust, the
Underwriter and the Trust's transfer agent to adopt procedures and take
other action (including, without limitation, rejecting specific purchase
orders in whole or in part) as they deem necessary to reduce, discourage,
restrict or eliminate such trading and/or market timing activity. You agree
that your purchases and redemptions of Portfolio shares are subject to, and
that you will assist us in implementing, the Market Timing Trading Policy
and Additional Policies (as described in the Trust's prospectus) and the
Trust's restrictions on excessive and/or short term trading activity and/or
purchase and redemption activity that follows a market timing pattern.
3.1.3 We agree that shares of the Trust will be sold only to
life insurance companies which have entered into fund participation
agreements with the Trust ("Participating Insurance Companies") and their
separate accounts or to qualified pension and retirement plans in
accordance with the terms of the Shared Funding Order. No shares of any
Portfolio will be sold to the general public.
3.2 THIS SUBSECTION 3.2 IS NOT USED
3.3 PURCHASE AND REDEMPTION
2
3.3.1 You are hereby appointed as our designee for the sole
purpose of receiving from Contract owners purchase and exchange orders and
requests for redemption resulting from investment in and payments under the
Contracts that pertain to subaccounts that invest in Portfolios
("Instructions"). "Business Day" shall mean any day on which the New York
Stock Exchange is open for trading and on which the Trust calculates its
net asset value pursuant to the rules of the SEC and its current
prospectus. "Close of Trading" shall mean the close of trading on the New
York Stock Exchange, generally 4:00 p.m. New York time. You represent and
warrant that all Instructions transmitted to us for processing on or as of
a given Business Day ("Day 1") shall have been received in proper form and
time stamped by you prior to the Close of Trading on Day 1. Such
Instructions shall receive the share price next calculated following the
Close of Trading on Day 1, provided that we receive such Instructions from
you before 9:30 a.m. New York time on the next Business Day ("Day 2"). You
represent and warrant that Instructions received in proper form and time
stamped by you after the Close of Trading on Day 1 shall be treated by you
and transmitted to us as if received on Day 2. Such Instructions shall
receive the share price next calculated following the Close of Trading on
Day 2. You represent and warrant that you have, maintain and periodically
test, procedures and systems in place reasonably designed to prevent
Instructions received after the Close of Trading on Day 1 from being
executed with Instructions received before the Close of Trading on Day 1.
All Instructions we receive from you after 9:30 a.m. New York time on Day 2
shall be processed by us on the following Business Day and shall receive
the share price next calculated following the Close of Trading on Day 2.
3.3.2 We shall calculate the net asset value per share of each
Portfolio on each Business Day, and shall communicate these net asset
values to you or your designated agent on a daily basis as soon as
reasonably practical after the calculation is completed (normally by 6:30
p.m. New York time).
3.3.3 You shall submit payment for the purchase of shares of a
Portfolio on behalf of an Account in federal funds transmitted by wire to
the Trust or to its designated custodian, which must receive such wires no
later than the close of the Reserve Bank, which is 6:00 p.m. New York time,
on the Business Day following the Business Day as of which such purchases
orders are made.
3.3.4 We will redeem any full or fractional shares of any
Portfolio, when requested by you on behalf of an Account, at the net asset
value next computed after receipt by us (or our agent or you as our
designee) of the request for redemption, as established in accordance with
the provisions of the then current prospectus of the Trust. We shall make
payment for such shares in the manner we establish from time to time, but
in no event shall payment be delayed for a greater period than is permitted
by the 1940 Act. Payments for the purchase or redemption of shares by you
may be netted against one another on any Business Day for the purpose of
determining the amount of any wire transfer on that Business Day.
3
3.3.5 Issuance and transfer of the Portfolio shares will be by
book entry only. Stock certificates will not be issued to you or the
Accounts. Portfolio shares purchased from the Trust will be recorded in the
appropriate title for each Account or the appropriate subaccount of each
Account.
3.3.6 We shall furnish, on or before the ex-dividend date,
notice to you of any income dividends or capital gain distributions payable
on the shares of any Portfolio. You hereby elect to receive all such income
dividends and capital gain distributions as are payable on shares of a
Portfolio in additional shares of that Portfolio, and you reserve the right
to change this election in the future. We will notify you of the number of
shares so issued as payment of such dividends and distributions.
3.3.7 Each party to this Agreement agrees that, in the event
of a material error resulting from incorrect information or confirmations,
the parties will seek to comply in all material respects with the
provisions of applicable federal securities laws.
5. A new Section 6.8 is hereby added to the Agreement as follows:
"6.8 You agree that any posting of Portfolio prospectuses on your
website will result in the Portfolio prospectuses: (i) appearing identical
to the hard copy printed version; (ii) being clearly associated with the
particular Contracts in which they are available and posted in close
proximity to the applicable Contract prospectuses; (iii) having no less
prominence than prospectuses of any other underlying funds available under
the Contracts; and (iv) being used in an authorized manner. Notwithstanding
the above, you understand and agree that you are responsible for ensuring
that participation in the Portfolios, and any website posting, or other
use, of the Portfolio prospectuses is in compliance with this Agreement and
applicable state and federal securities and insurance laws and regulations,
including as they relate to paper or electronic use of fund prospectuses.
The format of such presentation, the script and layout for any website that
mentions the Trust, the Underwriter, an Adviser or the Portfolios shall be
routed to us as sales literature or other promotional materials, pursuant
to Section 6 of this Agreement.
In addition, you agree to be solely responsible for maintaining and
updating the Portfolio prospectuses' PDF files (including prospectus
supplements) and removing and/or replacing promptly any outdated
prospectuses, as necessary, ensuring that any accompanying instructions by
us, for using or stopping use are followed. You agree to designate and make
available to us a person to act as a single point of communication contact
for these purposes. We are not responsible for any additional costs or
additional liabilities that may be incurred as a result of your election to
place the Portfolio prospectuses on your website. We reserve the right to
revoke this authorization, at any time and for any reason, although we may
instead make our authorization subject to new procedures."
4
6. A new Section 6.9 is hereby added to the Agreement as follows:
"6.9 Each of your and your distributor's registered
representatives, agents, independent contractors and employees, as
applicable, will have access to our websites at xxxxxxxxxxxxxxxxx.xxx, and
such other URLs through which we may permit you to conduct business
concerning the Portfolios from time to time (referred to collectively as
the "Site") as provided herein: (i) upon registration by such individual on
a Site; (ii) if you cause a Site Access Request Form (an "Access Form") to
be signed by your authorized supervisory personnel and submitted to us, as
a Schedule to, and legally a part of, this Agreement; or (iii) if you
provide such individual with the necessary access codes or other
information necessary to access the Site through any generic or firm-wide
authorization we may grant you from time to time. Upon receipt by us of a
completed registration submitted by an individual through the Site or a
signed Access Form referencing such individual, we shall be entitled to
rely upon the representations contained therein as if you had made them
directly hereunder and we will issue a user identification, express number
and/or password (collectively, "Access Code"). Any person to whom we issue
an Access Code or to whom you provide the necessary Access Codes or other
information necessary to access the Site through any generic or firm-wide
authorization we may grant you from time to time shall be an "Authorized
User."
We shall be entitled to assume that such person validly represents you
and that all instructions received from such person are authorized, in
which case such person will have access to the Site, including all services
and information to which you are authorized to access on the Site. All
inquiries and actions initiated by you (including your Authorized Users)
are your responsibility, are at your risk and are subject to our review and
approval (which could cause a delay in processing). You agree that we do
not have a duty to question information or instructions you (including
Authorized Users) give to us under this Agreement, and that we are entitled
to treat as authorized, and act upon, any such instructions and information
you submit to us. You agree to take all reasonable measures to prevent any
individual other than an Authorized User from obtaining access to the Site.
You agree to inform us if you wish to restrict or revoke the access of any
individual Access Code. If you become aware of any loss or theft or
unauthorized use of any Access Code, you agree to contact us immediately.
You also agree to monitor your (including Authorized Users') use of the
Site to ensure the terms of this Agreement are followed. You also agree
that you will comply with all policies and agreements concerning Site
usage, including without limitation the Terms of Use Agreement(s) posted on
the Site ("Site Terms"), as may be revised and reposted on the Site from
time to time, and those Site Terms (as in effect from time to time) are a
part of this Agreement. Your duties under this section are considered
"services" required under the terms of this Agreement. You acknowledge that
the Site is transmitted over the Internet on a reasonable efforts basis and
we do not warrant or guarantee their accuracy, timeliness, completeness,
reliability or non-infringement. Moreover, you acknowledge that the Site is
provided for informational purposes only, and is not intended to comply
with any requirements established by any regulatory or governmental
agency."
5
7. A new paragraph is added at the end of Section 10.8 of the Agreement as
follows:
"Each party to this Agreement agrees to limit the disclosure of
nonpublic personal information of Contract owners consistent with its
policies on privacy with respect to such information and Regulation S-P of
the SEC. Each party hereby agrees that it will comply with all applicable
requirements under the regulations implementing Title V of the
Xxxxx-Xxxxx-Xxxxxx Act and any other applicable federal and state consumer
privacy acts, rules and regulations. Each party further represents that it
has in place, and agrees that it will maintain, information security
policies and procedures for protecting nonpublic personal customer
information adequate to conform to applicable legal requirements."
8. Schedules A, B, C, D, F and G of the Agreement are hereby deleted in their
entirety and replaced with the Schedules A, B, C, D, F and G attached
hereto, respectively.
All other terms and provisions of the Agreement not amended herein shall remain
in full force and effect.
This Amendment is executed effective as of May 1, 2003.
FRANKLIN XXXXXXXXX VARIABLE INSURANCE THE LINCOLN NATIONAL LIFE INSURANCE
PRODUCTS TRUST COMPANY
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Rise X. X. Xxxxxx
--------------------------------- ----------------------------------
Name: Xxxxx X. Xxxxxxxx Name: Rise X. X. Xxxxxx
Title: Assistant Vice President Title: Vice President
FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
6
SCHEDULE A
THE COMPANY AND ITS DISTRIBUTOR
The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
A life insurance company incorporated in the State of Indiana
A
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Lincoln Life Flexible Premium Variable Life Account R
Date Established: December 2, 1997
SEC Registration Number: 811-08579
2. Name: Lincoln Life Flexible Premium Variable Life Account M
Date Established: December 2, 1997
SEC Registration Number: 811-08557
3. Name: Lincoln Life Flexible Premium Variable Life Account S
Date Established: November 1, 1998
SEC Registration Number: 811-09241
4. Name: Lincoln Life Flexible Premium Variable Life Account Z
Date Established: July 30, 2003
SEC Registration Number: Not Registered
5. Name:
Lincoln Life Variable Annuity Account N
Date Established: November 3, 1997
SEC Registration Number: 811-08517
6. Name: Lincoln Life Variable Annuity Account Q
Date Established: November 3, 1997
SEC Registration Number: 811-08569
7. Name: Lincoln National Life Insurance Company Separate Account 62
Date Established: July 1, 2001
SEC Registration Number: Not registered
8. Name: Lincoln National Life Insurance Company Separate Account 63
Date Established: July 1, 2001
SEC Registration Number: Not registered
9. Name: Lincoln National Variable Annuity Account C
Date Established: June 3, 1981
SEC Registration Number: 811-03214
10. Name: Lincoln National Variable Annuity Account L
Date Established: April 29, 1996
SEC Registration Number: 811-07645
B
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
---------------------------------------------------- ------------------
Franklin Small Cap Fund, Classes 1 and 2 Franklin Advisers, Inc.
Templeton Foreign Securities Fund, Classes 1 and 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Global Asset Allocation Fund, Classes 1 and 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund, Classes 1 and 2 Xxxxxxxxx Global Advisors Ltd.
C
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT# CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------------
1 The Lincoln SVUL I Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account R Xxxxxxxxx Foreign Securities Fund
Insurance 333-43107 December 2, 1997 Templeton Global Asset Allocation Fund
Company LN650LL 811-08579 Templeton Growth Securities Fund
2 The Lincoln VUL I Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Xxxxxxxxx Foreign Securities Fund
Insurance 333-42479 December 2, 1997 Templeton Global Asset Allocation Fund
Company LN605LL 811-08557 Templeton Growth Securities Fund
LN615
3 The Lincoln Lincoln VUL cv Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-42479 December 2, 1997
Company LN660 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
4 The Lincoln CVUL Lincoln Life Flexible Premium CLASS 2 SHARES:
National Life Yes Variable Life Account S Franklin Small Cap Fund
Insurance 333-72875 November 1, 1998 Xxxxxxxxx Foreign Securities Fund
Company LN920 811-09241 Templeton Global Asset Allocation Fund
LN921 Templeton Growth Securities Fund
5 The Lincoln Lincoln SVUL Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account R Franklin Small Cap Fund
Insurance 333-43107 December 2, 1997
Company LN650 811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
6 The Lincoln VUL(DB) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-82663 December 2, 1997
Company LN680 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
7 The Lincoln Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Variable Annuity Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997
Company 333-40937 811-08517 Xxxxxxxxx Growth Securities Fund
AN425LL
D-1
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT# CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------------
8 The Lincoln Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Access Variable Annuity Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997
Company 333-36316 811-08517 Xxxxxxxxx Growth Securities Fund
30296
9 The Lincoln Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Bonus Variable Annuity Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997
Company 333-36304 811-08517 Xxxxxxxxx Growth Securities Fund
30295
10 The Lincoln Lincoln MoneyGuard VUL Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-63940 December 2, 1997 Templeton Growth Securities Fund
Company ________ 811-08557
11 The Lincoln VUL(CV2) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-54338 December 2, 1997
Company LN665 811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
12 The Lincoln VUL(CV2) (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-54338 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company LN665 811-08557
13 The Lincoln MultiFund Individual Lincoln National Variable CLASS 2 SHARES:
National Life Yes Annuity Account C Franklin Small Cap Fund
Insurance 33-25990 June 3, 1981 Xxxxxxxxx Growth Securities Fund
Company 18829 811-03214
25982
28645
14 The Lincoln GVA I, II, III Lincoln National Variable CLASS 2 SHARES:
National Life Yes Annuity Account L Franklin Small Cap Fund
Insurance 333-05827 April 29, 1996 Xxxxxxxxx Growth Securities Fund
Company GAC96-101 811-07645
15 The Lincoln Choice Plus II Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small Cap Fund
Insurance 333-40937 November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 30070-B 811-08517
D-2
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT# CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------------
16 The Lincoln ChoicePlus II Access Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small Cap Fund
Insurance 333-36316 November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 30070-B 811-08517
17 The Lincoln ChoicePlus II Bonus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small Cap Fund
Insurance 333-36304 November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 30070-B 811-08517
18 The Lincoln ChoicePlus II Advance Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small Cap Fund
Insurance 333-61554 November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 30070-B 811-08517
19 The Lincoln MultiFund Group Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account Q Franklin Small Cap Fund
Insurance 333-43373 November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 28883 811-08569
20 The Lincoln SVUL II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account R Franklin Small Cap Fund
Insurance 333-33782 December 2, 1997
Company LN655 811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
21 The Lincoln Director(TM) Lincoln National Life Insurance CLASS 2 SHARES:
National Life No Company Separate Account 62 Xxxxxxxxx Growth Securities Fund
Insurance N/A
Company 19476 N/A
22 The Lincoln Director(TM) Lincoln National Life Insurance CLASS 2 SHARES:
National Life No Company Separate Account 63 Franklin Small Cap Fund
Insurance N/A
Company 19476 N/A
23 The Lincoln CVUL III (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account S Franklin Small Cap Fund
Insurance 333-72875 November 1, 1998 Templeton Growth Securities Fund
Company LN925 811-09241
LN926
24 The Lincoln VUL(DB) (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-82633 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company LN680 811-08557
25 The Lincoln SVUL II (Elite Funds) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account R Franklin Small Cap Fund
Insurance 333-33782 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company LN655 811-08579
D-3
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT# CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------------
26 The Lincoln SVUL III Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account R Franklin Small Cap Fund
Insurance 333-90432 December 2, 1997 Templeton Growth Securities Fund
Company LN656 811-08579
27 The Lincoln VUL(CV) III Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-84370 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company LN670 811-08557
28 The Lincoln VULdb II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-84360 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company LN690 811-08557
29 The Lincoln ChoicePlus Assurance Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life (B Shares) Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 333-40937 811-08517
30070-B
30 The Lincoln ChoicePlus Assurance Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life C Share) Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 333-36316 811-08517
30070-B
31 The Lincoln ChoicePlus Assurance Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life (L Share) Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 333-61554 811-08517
30070-B
32 The Lincoln ChoicePlus Assurance Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life (Bonus) Account N Franklin Small Cap Fund
Insurance Yes November 3, 1997 Xxxxxxxxx Growth Securities Fund
Company 333-36304 811-08517
30070-B
33 The Lincoln LCV4 Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account S Franklin Small Cap Fund
Insurance 333-104719 November 1, 1998 Xxxxxxxxx Growth Securities Fund
Company LN935 811-09241
34 The Lincoln CVUL III Lincoln Life Flexible Premium CLASS 2 SHARES:
National Life Yes Variable Life Account S Franklin Small Cap Fund
Insurance 333-72875 November 1, 1998 Xxxxxxxxx Foreign Securities Fund
Company LN925 811-09241 Templeton Global Asset Allocation Fund
LN926 Templeton Growth Securities Fund
D-4
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT# CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------------
35 The Lincoln Lincoln Corporate Lincoln Life Flexible Premium CLASS 2 SHARES:
National Life Variable Private Variable Life Account Z Franklin Small Cap Fund
Insurance Solutions July 30, 2003 Templeton Growth Securities Fund
Company No N/A
N/A
LN930
36 The Lincoln Momentum VUL(ONE) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-111128 December 2, 1997 Templeton Growth Securities Fund
Company 811-08557
37 The Lincoln VUL(ONE) Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Account M Franklin Small Cap Fund
Insurance 333-111137 December 2, 1997 Xxxxxxxxx Growth Securities Fund
Company 811-08557
D-5
SCHEDULE F
RULE 12b-1 PLANS OF THE TRUST
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
PORTFOLIO NAME MAXIMUM ANNUAL PAYMENT RATE
-------------- ---------------------------
Franklin Small Cap Fund 0.25%
Xxxxxxxxx Foreign Securities Fund 0.25%
Templeton Global Asset Allocation Fund 0.25%
Xxxxxxxxx Growth Securities Fund 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio
shares ("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under
the 1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees
(collectively "you") provide any activity or service which is primarily intended
to assist in the promotion, distribution or account servicing of Eligible Shares
("Rule 12b-1 Services") or variable contracts offering Eligible Shares, the
Underwriter, the Trust or their affiliates (collectively, "we") may pay you a
Rule 12b-1 fee. "Rule 12b-1 Services" may include, but are not limited to,
printing of prospectuses and reports used for sales purposes, preparing and
distributing sales literature and related expenses, advertisements, education of
dealers and their representatives, and similar distribution-related expenses,
furnishing personal services to owners of Contracts which may invest in Eligible
Shares ("Contract Owners"), education of Contract Owners, answering routine
inquiries regarding a Portfolio, coordinating responses to Contract Owner
inquiries regarding the Portfolios, maintaining such accounts or providing such
other enhanced services as a Trust Portfolio or Contract may require, or
providing other services eligible for service fees as defined under NASD rules.
Your acceptance of such compensation is your acknowledgment that eligible
services have been rendered. All Rule 12b-1 fees, shall be based on the value of
Eligible Shares owned by the Company on behalf of its Accounts, and shall be
calculated on the basis and at the rates set forth in the Compensation Schedule
stated above. The aggregate annual fees paid pursuant to each Plan shall not
exceed the amounts stated as the "annual maximums" in the Portfolio's
prospectus, unless an increase is approved by shareholders as provided in the
Plan. These maximums shall be a specified percent of the value of a Portfolio's
net assets attributable to Eligible Shares owned by the Company on behalf of its
Accounts (determined in the same manner as the Portfolio uses to compute its net
assets as set forth in its effective Prospectus). The Rule 12b-1 fee will be
paid to you within thirty (30) days after the end of the three-month periods
ending in January, April, July and October.
F-1
You shall furnish us with such information as shall reasonably be
requested by the Trust's Boards of Trustees ("Trustees") with respect to the
Rule 12b-1 fees paid to you pursuant to the Plans. We shall furnish to the
Trustees, for their review on a quarterly basis, a written report of the amounts
expended under the Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must
be approved annually by a vote of the Trustees, including the Trustees who are
not interested persons of the Trust and who have no financial interest in the
Plans or any related agreement ("Disinterested Trustees"). Each Plan may be
terminated at any time by the vote of a majority of the Disinterested Trustees,
or by a vote of a majority of the outstanding shares as provided in the Plan, on
sixty (60) days' written notice, without payment of any penalty. The Plans may
also be terminated by any act that terminates the Underwriting Agreement between
the Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
F-2
SCHEDULE G
ADDRESSES FOR NOTICES
To the Company: The Lincoln National Life Insurance Company
0000 Xxxxx Xxxxxxx Xxxxxx, 0X-00
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Rise X. X. Xxxxxx, Vice President
To the Trust: Franklin Xxxxxxxxx Variable Insurance Products Trust
Xxx Xxxxxxxx Xxxxxxx, Xxxx. 000 0xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Assistant Vice President
With a copy to: Xxxxxx Xxxxxxx, General Counsel
To the Underwriter: Franklin Xxxxxxxxx Distributors, Inc.
Xxx Xxxxxxxx Xxxxxxx, Xxxx. 000 0xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Vice President
With a copy to: Xxxxxx Xxxxxxx, General Counsel
AMENDMENT NO. 4 TO PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
The Lincoln National Life Insurance Company
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us") and The Lincoln National Life Insurance Company ("you"),
have previously entered into a Participation Agreement dated May 1, 2000 (the
"Agreement"). The parties now desire to amend the Agreement in this amendment
(the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement
shall remain in full force and effect. Unless otherwise indicated, the terms
defined in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Schedule D of the Agreement is hereby deleted in its entirety and replaced
with the Schedule D attached hereto.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
This Amendment is executed effective as of May 2, 2005.
FRANKLIN XXXXXXXXX VARIABLE THE LINCOLN NATIONAL LIFE
INSURANCE PRODUCTS TRUST INSURANCE COMPANY
By: /s Xxxxx X. Xxxxxxxx By: /s/ Rise X.X. Xxxxxx
--------------------------- -----------------------------
Name: Xxxxx X. Xxxxxxxx Name: Rise X. X. Xxxxxx
Title: Assistant Vice President Title: Vice President
FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxx X. Xxx
-----------------------
Name: Xxxxx X. Xxx
Title: Senior Vice President
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Lincoln Life Flexible Premium Variable Life
Account R
Date Established: December 2, 1997
SEC Registration Number: 811-08579
2. Name: Lincoln Life Flexible Premium Variable Life
Account M
Date Established: December 2, 1997
SEC Registration Number: 811-08557
3. Name: Lincoln Life Flexible Premium Variable Life
Account S
Date Established: November 1, 1998
SEC Registration Number: 811-09241
4. Name: Lincoln Life Flexible Premium Variable Life
Account Z
Date Established: July 30, 2003
SEC Registration Number: Not Registered
5. Name:
Lincoln Life Variable Annuity
Account N
Date Established: November 3, 1997
SEC Registration Number: 811-08517
6. Name: Lincoln National Life Insurance Company
Separate Account 62
Date Established: July 1, 2001
SEC Registration Number: Not registered
7. Name: Lincoln National Life Insurance Company
Separate Account 63
Date Established: July 1, 2001
SEC Registration Number: Not registered
8. Name: Lincoln National Variable Annuity
Account C
Date Established: June 3, 1981
SEC Registration Number: 811-03214
2
9. Name: Lincoln National Life Insurance Company
Separate Account 86
Date Established:
SEC Registration Number: Not registered
3
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
1. The Lincoln SVUL I Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Xxxxxxxxx Foreign Securities Fund
Insurance 333-43107 Account R Templeton Global Asset Allocation
Company LN650LL December 2, 1997 Fund
811-08579 Templeton Growth Securities Fund
2. The Lincoln VUL I Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Xxxxxxxxx Foreign Securities Fund
Insurance 333-42479 Account M Templeton Global Asset Allocation
Company LN605LL December 2, 1997 Fund
LN615 811-08557 Templeton Growth Securities Fund
3. The Lincoln VUL(CV) Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Franklin Small-Mid Cap Growth
Insurance 333-42479 Account M Securities Fund
Company LN660 December 2, 1997
811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
4. The Lincoln CVUL Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Xxxxxxxxx Global Income Securities
Insurance 333-72875 Account S Fund
Company LN920 November 1, 1998
LN921 811-09241 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Xxxxxxxxx Foreign Securities Fund
Templeton Global Asset Allocation
Fund
Xxxxxxxxx Growth Securities Fund
5. The Lincoln SVUL Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Franklin Small-Mid Cap Growth
Insurance 333-43107 Account R Securities Fund
Company LN650 December 2, 1997
811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
6. The Lincoln VUL(DB) Lincoln Life Flexible CLASS 1 SHARES:
National Life Yes Premium Variable Life Franklin Small-Mid Cap Growth
Insurance 333-82663 Account M Securities Fund
Company LN680 December 2, 1997
811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
7. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Variable Annuity Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-40937 811-08517 Xxxxxxxxx Growth Securities Fund
AN425LL Xxxxxxxxx Global Income Securities
Fund
8. The Lincoln ChoicePlus Access Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Variable Annuity Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-36316 811-08517 Xxxxxxxxx Growth Securities Fund
30296 Xxxxxxxxx Global Income Securities
Fund
9. The Lincoln ChoicePlus Bonus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Variable Annuity Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-36304 811-08517 Xxxxxxxxx Growth Securities Fund
30295 Xxxxxxxxx Global Income Securities
Fund
10. The Lincoln MoneyGuard Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life VUL Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account M Securities Fund
Company 333-63940 December 2, 1997 Templeton Growth Securities Fund
811-08557
11. The Lincoln VUL(CV) II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-54338 Account M Securities Fund
Company LN665 December 2, 1997
811-08557 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Templeton Growth Securities Fund
12. The Lincoln VUL(CV) II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life VUL Flex Variable Life Franklin Small-Mid Cap Growth
Insurance (Elite Funds) Account M Securities Fund
Company Yes December 2, 1997 Xxxxxxxxx Growth Securities Fund
333-54338 811-08557 Xxxxxxxxx Global Income Securities
LN665 Fund
13. The Lincoln Choice Plus II Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small-Mid Cap Growth
Insurance 333-40937 November 3, 1997 Securities Fund
Company 30070-B 811-08517 Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
14. The Lincoln ChoicePlus II Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Access Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-36316 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
15. The Lincoln ChoicePlus II Bonus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Yes Account N Franklin Small-Mid Cap Growth
Insurance 333-36304 November 3, 1997 Securities Fund
Company 30070-B 811-08517 Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
16. The Lincoln ChoicePlus II Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Advance Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-61554 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
17. The Lincoln SVUL II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-33782 Account R Securities Fund
Company LN655 December 2, 1997
811-08579 CLASS 2 SHARES:
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
18. The Lincoln Director (TM) Lincoln National Life CLASS 2 SHARES:
National Life No Insurance Company Separate Xxxxxxxxx Growth Securities Fund
Insurance N/A Account 62
Company 19476 N/A
19. The Lincoln Director (TM) Lincoln National Life CLASS 2 SHARES:
National Life No Insurance Company Separate Franklin Small-Mid Cap Growth
Insurance N/A Account 63 Securities Fund
Company 19476 N/A
20. The Lincoln CVUL III (Elite Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Funds) Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account S Securities Fund
Company 333-72875 November 1, 1998 Xxxxxxxxx Global Income Securities
LN925 811-09241 Fund
LN926 Templeton Growth Securities Fund
21. The Lincoln VUL(DB) (Elite Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Funds) Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account M Securities Fund
Company 333-82633 December 2, 1997 Xxxxxxxxx Growth Securities Fund
LN680 811-08557
22. The Lincoln SVUL II (Elite Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Funds) Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account R Securities Fund
Company 333-33782 December 2, 1997 Xxxxxxxxx Global Income Securities
LN655 811-08579 Fund
Xxxxxxxxx Growth Securities Fund
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
23. The Lincoln SVUL III Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-90432 Account R Securities Fund
Company LN656 December 2, 1997 Templeton Growth Securities Fund
811-08579
24. The Lincoln VUL(CV) III Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-84370 Account M Securities Fund
Company LN670 December 2, 1997 Templeton Growth Securities Fund
811-08557
25. The Lincoln VUL(DB) II Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-84360 Account M Securities Fund
Company LN690 December 2, 1997 Xxxxxxxxx Growth Securities Fund
811-08557
26. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Assurance (B Share) Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-40937 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
27. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Assurance (C Share) Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-36316 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
28. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Assurance (L Share) Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-61554 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
29. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Assurance (Bonus) Account N Franklin Small-Mid Cap Growth
Insurance Yes November 3, 1997 Securities Fund
Company 333-36304 811-08517 Xxxxxxxxx Global Income Securities
30070-B Fund
Xxxxxxxxx Growth Securities Fund
30. The Lincoln LCV4 Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-104719 Account S Securities Fund
Company LN935 November 1, 1998 Xxxxxxxxx Global Income Securities
811-09241 Fund
Xxxxxxxxx Growth Securities Fund
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
31. The Lincoln CVUL III Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Xxxxxxxxx Global Income Securities
Insurance 333-72875 Account S Fund
Company LN925 November 1, 1998
LN926 811-09241 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation
Fund
Xxxxxxxxx Growth Securities Fund
32. The Lincoln Lincoln Corporate Lincoln Life Flexible Premium CLASS 2 SHARES:
National Life Variable Private Variable Life Franklin Small-Mid Cap Growth
Insurance Solutions Account Z Securities Fund
Company No July 30, 2003 Xxxxxxxxx Growth Securities Fund
N/A N/A
LN930
33. The Lincoln Momentum Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life VULONE Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account M Securities Fund
Company 333-111128 December 2, 1997 Xxxxxxxxx Global Income Securities
811-08557 Fund
Xxxxxxxxx Growth Securities Fund
34. The Lincoln VULONE Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-111137 Account M Securities Fund
Company December 2, 1997 Xxxxxxxxx Global Income Securities
811-08557 Fund
Xxxxxxxxx Growth Securities Fund
35. The Lincoln ChoicePlus Lincoln Life Variable Annuity CLASS 2 SHARES:
National Life Momentum Income Account N Franklin Small-Mid Cap Growth
Insurance Option November 3, 1997 Securities Fund
Company Yes 811-08517 Xxxxxxxxx Global Income Securities
333-119165 Fund
AN501 9/04 Xxxxxxxxx Growth Securities Fund
36. The Lincoln VUL(DB) IV Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-118477 Account M Securities Fund
Company LN690 December 2, 1997 Xxxxxxxxx Global Income Securities
811-08557 Fund
Xxxxxxxxx Growth Securities Fund
37. The Lincoln VUL(CV) IV Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-118478 Account M Securities Fund
Company LN670 December 2, 1997 Xxxxxxxxx Global Income Securities
811-08557 Fund
Xxxxxxxxx Growth Securities Fund
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
COMPANY 1933 ACT #, STATE REGISTRATION DATE
# NAME FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
38. The Lincoln SVUL IV Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-115882 Account R Securities Fund
Company LN656 December 2, 1997 Xxxxxxxxx Global Income Securities
811-08579 Fund
Xxxxxxxxx Growth Securities Fund
39. The Lincoln VULONE2005 Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life Yes Variable Life Franklin Small-Mid Cap Growth
Insurance 333-111137 Account M Securities Fund
Company LN694 December 2, 1997 Xxxxxxxxx Global Income Securities
811-08557 Fund
Xxxxxxxxx Growth Securities Fund
40. The Lincoln Momentum Lincoln Life Flexible Premium CLASS 1 SHARES:
National Life VULONE2005 Variable Life Franklin Small-Mid Cap Growth
Insurance Yes Account M Securities Fund
Company 333-111128 December 2, 1997 Xxxxxxxxx Global Income Securities
LN695 811-08557 Fund
Xxxxxxxxx Growth Securities Fund
41. The Lincoln MultiFund 5 Lincoln National Variable CLASS 2 SHARES:
National Life Yes Annuity Account C Xxxxxxxxx Global Income Securities
Insurance 333-68842 June 3, 1981 Fund
Company 30070-B 811-03214
42. The Lincoln Director(TM) Lincoln National Life CLASS 1 SHARES:
National Life No Insurance Company Separate Xxxxxxxxx Global Income Securities
Insurance N/A Account 86 Fund
Company 19476 N/A
