WHOLESALING AGREEMENT
AGREEMENT dated as of October _________, 1999, by and between The Lincoln
National Life Insurance Company ("Lincoln"), in its capacity as principal
underwriter for one or more of its insurance and/or annuity separate
accounts, and DELAWARE DISTRIBUTORS, L.P., a Delaware limited partnership
(hereinafter referred to as "DELAWARE").
WITNESSETH:
WHEREAS, Lincoln issues and sells certain variable annuity and variable life
insurance contracts acting as its own principal underwriter for such
contracts; and
WHEREAS, Lincoln and DELAWARE desire to establish an arrangement whereby
DELAWARE will act as a wholesaler for such variable annuity contracts and
variable life insurance contracts and, as such, will recruit business firms
to distribute such contracts;
NOW, THEREFORE, in consideration of their mutual promises, Lincoln, and
DELAWARE hereby agree as follows:
1. DEFINITIONS
a. 1933 ACT -- The Securities Act of 1933, as amended.
b. 1934 ACT -- The Securities Exchange Act of 1934, as amended.
c. 1940 ACT -- The Investment Company Act of 1940, as amended.
d. ACCOUNT -- Each and any separate account established by Lincoln and
listed on Schedule 1.a to this Agreement, as amended from time to
time in accordance with Section 2.e of this Agreement. The phrase
"Account supporting the Contracts" or "Account supporting a class of
Contracts" shall mean the separate account identified in such
Contracts as the separate account to which the Purchase Payments
made under such Contracts are allocated and as to which income,
gains and losses, whether or not realized, from assets allocated to
such separate account,
are, in accordance with such Contracts, credited to or charged
against such separate account without regard to other income,
gains, or losses of Lincoln or any other separate account
established by Lincoln.
e. ASSOCIATED PERSON -- This term as used in this Agreement shall have
the meaning assigned to it in the 1934 Act.
f. BROKER -- An entity registered as a broker-dealer and licensed as a
life insurance agent or associated with an entity so licensed in
accordance with any applicable SEC no-action letter, and recruited
by DELAWARE and subsequently authorized by Lincoln to distribute the
Contracts pursuant to a sales agreement with Lincoln entered into in
accordance with Section 3 of this Agreement.
g. CONTRACTS -- The variable annuity contracts or variable life
insurance contracts described more specifically on Schedule 1.b to
this Agreement, as amended from time to time pursuant to Section
2.e. The term "Contracts" shall include any riders to such
contracts and any other contracts offered in connection therewith or
any contracts for which such Contracts may be exchanged or
converted. The phrase "a class of Contracts" shall mean those
variable annuity contracts or variable life insurance contracts, as
the case may be, issued on the same policy form or forms and covered
by the same Registration Statement, as shown on Schedule 1.b to this
Agreement.
h. DISTRIBUTOR -- The Lincoln National Life Insurance Company,
principal underwriter for the Contracts.
i. FUND -- Any fund or series thereof in which an Account supporting
the Contracts invests. (Plural, "Funds")
j. FUND PROSPECTUS -- At any time while this Agreement is in effect,
the prospectus for a Fund most recently filed with the SEC pursuant
to Rule 497 under the 1933 Act. (For purposes of Section 11 of this
Agreement, however, the term "Fund Prospectus" means any document
that is or at any time was a Fund Prospectus within the meaning of
this Section l.g.)
k. FUND REGISTRATION STATEMENT -- At any time while this Agreement is
in effect, the
currently effective registration statement filed with the SEC
under the 1933 Act, or currently effective post-effective
amendment thereto, for shares of a Fund. (For purposes of Section
11 of this Agreement, however, the term "Fund Registration
Statement" means any document that is or at any time was a Fund
Registration Statement within the meaning of this Section 1.f.)
l. NASD -- The National Association of Securities Dealers, Inc.
m. PARTICIPATION AGREEMENT -- An agreement between Lincoln and a Fund
relating to the investment of assets of Lincoln separate accounts in
such Fund.
n. PROCEDURES -- The administrative procedures prepared and distributed
by Lincoln, as such may be amended or supplemented from time to
time, relating to the solicitation, sale and delivery of the
Contracts.
o. PROSPECTUS -- At any time while this Agreement is in effect, the
current prospectus most recently filed with the SEC pursuant to Rule
497 of the 1933 Act. (For purposes of Sections 5.a and 11 of this
Agreement, however, the term "any Prospectus" means any document
that is or at any time was a Prospectus within the meaning of this
Section 1.d.)
p. PURCHASE PAYMENT -- A payment made under a Contract by an applicant
or purchaser to purchase benefits under the Contract.
q. REGISTRATION STATEMENT -- At any time while this Agreement is in
effect, the pending registration statement filed with the SEC under
the 1933 Act, the currently effective registration statement, or
currently effective post-effective amendment thereto, as applicable,
relating to a class of Contracts, including financial statements
included in, and all exhibits to, such registration statement or
post-effective amendment. (For
purposes of Sections 5.a and 11 of this Agreement, however, the term
"Registration Statement" means any document that is or at any time
was a Registration Statement within the meaning of this Section
1.c.) REGISTRATION STATEMENT -- At any time while this
Agreement is in effect, the pending registration statement filed
with the SEC under the 1933 Act, the currently effective
registration statement, or currently effective post-effective
amendment thereto, as applicable, relating to a class of
Contracts, including financial statements included in, and all
exhibits to, such registration statement or post-effective
amendment. (For
purposes of Sections 5.a and 11 of this Agreement, however, the term
"Registration Statement" means any document that is or at any time
was a Registration Statement within the meaning of this Section
1.c.)
r. REGULATIONS -- The rules and regulations promulgated by the SEC
under the 1933 Act, the 1934 Act and the 1940 Act as in effect at
the time this Agreement is executed or thereafter promulgated, and
as they may be amended from time to time.
s. REPRESENTATIVE -- An Associated Person of DELAWARE or a Broker
registered with the NASD as a registered representative or principal
of DELAWARE or Broker, as the case may be.
t. SEC -- The Securities and Exchange Commission
u. STATE -- any state or commonwealth of the United States, the
District of Columbia or any other territory of the United States.
v. TERRITORY -- Any State or territory of the United States (including
the District of Columbia) where the contracts have been filed and
approved for sale by the appropriate regulatory authorities.
w. WHOLESALER -- Delaware Distributors, L.P., when it performs the
functions assigned to it in this agreement (including, but not by
way of limitation, those functions set forth in Sections 2, 3 and 4
hereof).
2. APPOINTMENT AND WHOLESALING DUTIES
a. Lincoln hereby authorizes DELAWARE under applicable securities laws to
engage in the activities contemplated in this Agreement relating to the
wholesaling of the Contracts for which Lincoln acts as principal
underwriter.
b. DELAWARE undertakes to use its best efforts to, contact, recruit, screen,
and recommend Brokers in accordance with Section 3 of this Agreement,
consistent with market conditions and compliance with its responsibilities
under the federal securities laws and NASD rules and regulations.
c. (1) The appointment and authorization of DELAWARE to engage in
wholesaling activities pursuant to this Agreement is not exclusive as to
the Contracts listed on Schedule 1.b, as amended from time to time in
accordance with Section 2.e of this Agreement, and Lincoln may authorize
any other person (as principal underwriter or otherwise) to engage in
wholesaling or distribution activities with respect to the Contracts or to
recruit business firms to engage in wholesaling or distribution activities
with respect to the Contracts, including business firms recommended by
DELAWARE pursuant to Section 3 of this Agreement, and Lincoln may
separately engage in wholesaling and distribution activities relating to
the Contracts.
(2) To the extent that any Contract offers a general account option,
Lincoln shall, if required, register that option under the 0000 Xxx.
(3) Lincoln shall register each Account with the SEC. The subaccounts
of each Account available under the Contracts or a class of Contracts are
listed on Schedule 1.a to this Agreement, as amended from time to time in
accordance with Section 2.e of this Agreement.
x. Xxxxxxx shall obtain appropriate authorizations, to the extent necessary,
whether by registration, qualification, approval or otherwise, for the
issuance and sale of the Contracts in each State (provided, however, that
it shall be within Lincoln's discretion
whether to obtain such authorization in Hawaii, Guam, the U.S. Virgin
Islands, Puerto Rico or American Samoa, or for any U.S. military base).
From time to time Lincoln shall notify DELAWARE in writing of all States
in which each class of Contracts may then lawfully be offered.
e. The parties to this Agreement may amend Schedules 1.a and 1.b to this
Agreement from time to time by mutual agreement to reflect changes in or
relating to the Contracts and the Accounts and to add new classes of
variable annuity contracts and variable life insurance contracts to be
issued by Lincoln for which DELAWARE will act as wholesaler. The
provisions of this Agreement shall be equally applicable to each such class
of Contracts, unless the context otherwise requires. Schedule 9.a to this
Agreement may be amended only by mutual agreement of the parties to this
Agreement pursuant to Section 9 of this Agreement.
f. The responsibility for selecting, eliminating, and substituting underlying
funding options for each Account rests exclusively with Lincoln.
3. RECRUITMENT OF BROKERS AND RELATED RESPONSIBILITIES
a. Lincoln hereby authorizes DELAWARE to contact, recruit, screen, and
recommend to Lincoln business firms appropriate to act as Brokers for the
sale of the Contracts, and Delaware agrees to do so. Delaware will use its
best efforts, upon diligent inquiry to recruit only brokers which are
members in good standing of the NASD, and which are under no legal
restriction that would prevent them from selling the Contracts. Lincoln
shall have the right to reject any such recommendation, but shall not do so
arbitrarily or unreasonably.
x. Xxxxxxx shall have the responsibility for and bear the cost of: (i)
executing appropriate sales agreements with the business firms recommended
by DELAWARE; and (ii) appointing, with the assistance of DELAWARE (see
Paragraph 3 (d) below), such business firms, and/or Associated Persons of
such firms, as insurance agents of Lincoln in those States where such
business firms and/or Associated Persons possess insurance
agent licenses. Neither DELAWARE nor Lincoln shall have responsibility
for, or bear the cost of, any registration or licensing of Brokers or
any of their Associated Persons with the SEC, NASD or any state
insurance governmental or regulatory agency. The costs of appointment
shall be borne as provided in Section 9.c hereof. Lincoln shall
maintain the appointment records of all agents appointed by Lincoln to
distribute the Contracts contemplated by this Agreement.
c. Any sales agreement entered into by Lincoln with a Broker shall provide
that:
(1) The Broker (or an affiliated person duly registered as a
broker-dealer with the SEC) shall train, supervise, and be solely
responsible for the conduct of, all of its Associated Persons in the
proper method of solicitation, sale and delivery of the Contracts for
the purpose of complying on a continuous basis with the NASD Conduct
Rules and with federal and state securities and insurance law
requirements applicable in connection with the offering and sale of the
Contracts;
(2) Purchase Payments shall be made payable to Lincoln and shall be
delivered together with all applications and related information in
accordance with the Procedures;
(3) The Broker shall be solely responsible for all compensation paid to
its Representatives and all related tax reporting that may be required
under applicable law;
(4) The Broker and its Representatives shall not use, develop or
distribute any promotional, sales or advertising material that has not
been approved in writing by Lincoln and filed with the appropriate
governmental or regulatory agencies; and
(5) The Broker shall not have authority, on behalf of Lincoln or
DELAWARE, to make, alter or discharge any Contract or other contract
entered into pursuant to a Contract; to waive any Contract forfeiture
provision; to extend the time of paying any Purchase Payment; to receive
any monies or Purchase Payments (except for the sole purpose of
forwarding monies or Purchase Payments to Lincoln); or to expend, or
contract for the expenditure of, funds of Lincoln or DELAWARE.
d. DELAWARE shall provide assistance to Lincoln in the appointment procedure
applicable to Brokers and their Representatives as may be reasonably
acceptable to Lincoln.
e. DELAWARE shall train, supervise, and be solely responsible for the conduct
of, all of its Associated Persons (but not Brokers or their Representatives
unaffiliated with DELAWARE), for the purpose of complying on a continuous
basis with the NASD Conduct Rules and with federal securities laws and
state securities and insurance laws applicable to the wholesaling
activities contemplated in this Agreement. DELAWARE shall be responsible
for the maintenance and updating of broker-dealer or agent registrations
that they determine to be necessary for themselves and/or their Associated
Persons pursuant to any federal or state securities law or state insurance
law.
f. Neither DELAWARE nor Lincoln will have any supervisory responsibility (as
such supervision is contemplated by the 1934 Act or the NASD's Conduct
Rules) with respect to Brokers or their Representatives. Under no
circumstances will DELAWARE be responsible for Brokers' or their
Representatives' failure to comply with applicable law or the Procedures,
except where that failure arises out of the negligence or intentional
misfeasance of DELAWARE.
g. DELAWARE shall not have authority on behalf of Lincoln to make, alter or
discharge any Contract or other contract entered into pursuant to a
Contract; to waive any Contract forfeiture provision; to extend the time of
paying any Purchase Payment; or to receive any monies or Purchase Payments.
DELAWARE shall not expend, nor contract for the expenditure of, funds of
Lincoln; nor shall DELAWARE possess or exercise any authority on behalf of
Lincoln other than that expressly conferred on DELAWARE by this Agreement.
h. DELAWARE shall act as an independent contractor in the performance of its
duties and obligations under this Agreement, and nothing contained in this
Agreement shall constitute DELAWARE or its respective Associated Persons
employees of Lincoln in
connection with the wholesaling activities contemplated by this
Agreement or otherwise.
i. DELAWARE shall not purchase Contracts from, nor sell Contracts for,
Lincoln, nor shall it have any direct or indirect participation in such
undertakings, and nothing contained in this Agreement shall constitute
DELAWARE a "principal underwriter" of any of the Contracts, as those terms
are defined in the 1933, 1934 or 1940 Acts.
j. The Distributor of the Contracts, as the term "Distributor" is customarily
used in the variable insurance products industry, shall be Lincoln, and
Lincoln shall be identified as such in all sales, promotional, and
advertising materials for the Contracts.
4. MARKETING AND SALES MATERIAL
a. (1) Lincoln and DELAWARE shall cooperate fully in the drafting and
design of all promotional, sales and advertising material developed for
filing pursuant to Section 4.a (3). However, Lincoln shall have the
ultimate responsibility at all stages for approval of all promotional,
sales and advertising materials, regardless of who develops them. Such
material shall not be used until the necessary NASD clearance has been
obtained.
(2) Lincoln shall have ultimate control over the text and design of any
Internet or World Wide Web site(s) developed by DELAWARE for use, in whole
or in part, for the distribution of the Contracts. DELAWARE shall
guarantee that, without prior authorization in writing from Lincoln, there
shall be no hyperlinks or other electronic connections between the Web
site(s) described in the preceding sentence and any current or future Web
site(s) in use or to be used for or in connection with any other Lincoln
products or services.
(3) a. DELAWARE shall be responsible for filing with the NASD, as
required, all promotional, sales and advertising material whether developed
by Lincoln or by DELAWARE. Lincoln shall be responsible for filing, as
required, all such material (whether developed by Lincoln or DELAWARE) with
any other federal or state securities
governmental or regulatory agencies, or with any state insurance
governmental or regulatory agencies.
(4) With respect to all promotional, sales and advertising material
developed by DELAWARE, Lincoln shall be afforded no less than five
business days for review and approval at each iteration of copy and
layout.
b. DELAWARE acknowledges that Lincoln shall have the unconditional right to
reject, in whole or in part, any application for a Contract. In the event
an application is rejected, any Purchase Payment submitted will be returned
by or on behalf of Lincoln. Lincoln will notify the Broker/Dealer which
submitted the Purchase Payment of such action. In the event that a
purchaser exercises the free look right under the Contract, any amount to
be refunded as provided in such Contract will be so refunded to the
purchaser by or on behalf of Lincoln. Lincoln will notify the
Broker/Dealer which solicited the sale of the Contract of such action.
x. Xxxxxxx and DELAWARE shall equally share the costs (other than any borne by
a Fund pursuant to the relevant Participation Agreement) for printing all
preliminary and definitive Fund and Contract Prospectuses and any
supplements thereto.
d. DELAWARE will pay the following expenses contemplated by this Agreement
for: (i) the compensation, if any, of its Associated Persons; (ii) expenses
associated with the initial and ongoing NASD licensing and training of its
Associated Persons involved in the wholesaling activities; (iii) the
drafting, design, printing and mailing of all promotional, sales or
advertising material for use in connection with the distribution of the
Contracts; (iv) expenses associated with telecommunications with Lincoln at
the sites of DELAWARE or its Associated Persons, including site
installations and purchases, leases or rentals of modems, terminals and
other hardware, and lease line telephone charges for their Associated
Persons and for all Brokers; (v) continuing education courses sponsored by
Delaware for all Brokers and relating to the Contracts; (vi) fees
associated with NASD filings; (vii) development and maintenance of
DELAWARE's Internet Web sites and
related functions; (viii) media advertising and promotion (e.g., broker
trade journals); and (ix) any other expenses incurred by DELAWARE or its
Associated Persons for the purpose of carrying out the obligations of
DELAWARE hereunder.
x. Xxxxxxx will pay all expenses in connection with: (i) the preparation and
filing with appropriate governmental or regulatory agencies of the
Registration Statement and each preliminary Prospectus and definitive
Prospectus; (ii) the preparation and issuance of the Contracts; (iii) any
authorization, registration, qualification or approval of the Contracts
required under the securities, blue-sky laws or insurance laws of the
States; (iv) registration fees for the Contracts payable to the SEC or to
any other governmental or regulatory agency except NASD; (v) the mailing of
Prospectuses for the Contracts and Fund Prospectuses and any supplements
thereto, as required by federal securities laws, and proxy soliciting
materials and periodic reports relating to a Fund or the Accounts to
Contract owners; (vi) the printing of applications, the Procedures and any
other administrative forms utilized in connection with the servicing of the
Contracts; (vii) compensation as provided in Section 9 hereof; (viii) the
design and maintenance of any product-specific Web site for the contracts,
if Lincoln determines that such a Web site is necessary or advisable; and
(ix) any other expenses related to the distribution of the Contracts except
those set forth in Section 4.c of this Agreement and except as provided in
Section 4.d of this Agreement.
f. Except to the extent for which DELAWARE is responsible under section 6.5
hereof, Lincoln alone shall be responsible for and bear the cost of
administration of the Contracts following their issuance, including all
Contractowner service and communication activities.
x. Xxxxxxx will confirm to each owner of a Contract, in accordance with Rule
10b-10 under the 1934 Act, its acceptance of Purchase Payments and such
other transactions as are
required by Rule 10b-10 or administrative interpretations thereunder and
in accordance with Release 8389 under the 1934 Act. Except for material
which is required by law to accompany these confirmations, nothing shall
be included with them that has not been approved in advance by Lincoln
and DELAWARE.
5. REPRESENTATIONS AND WARRANTIES
a. Lincoln represents and warrants to DELAWARE, on the effective date of each
Registration Statement for the Contracts (or class of Contracts) and at
each time that a Contract is sold and on the date of this Agreement, as
follows:
(1) The Registration Statement has been declared effective by the SEC or
has become effective in accordance with the Regulations.
(2) The Registration Statement and the Prospectus each comply in all
material respects with the provisions of the 1933 Act and the 1940 Act and
the Regulations, and neither the Registration Statement nor the Prospectus
contains an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in light of the circumstances in which
they were made; provided, however, that none of the representations and
warranties in this Section 5.a(2) shall apply to statements in or omissions
from the Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to Lincoln in writing by DELAWARE
expressly for use in the Registration Statement.
(3) Lincoln has not received notice from the SEC with respect to the
Registration Statement or the Account supporting the Contracts described in
the Registration Statement pursuant to Section 8(e) of the 1940 Act and no
stop order under the 1933 Act has been issued and no proceeding therefor
has been instituted or threatened by the SEC.
(4) The accountants who certified the financial statements included in
the Registration Statement and Prospectus are independent public
accountants as required by the 1933 Act, the 1940 Act and the Regulations.
(5) The financial statements included in the Registration Statement
present fairly the
respective financial positions of Lincoln and the Account supporting the
Contracts described in the Registration Statement as of the dates
indicated; and such financial statements have been prepared in
conformity with generally accepted accounting principles in the United
States applied on a consistent basis.
(6) Subsequent to the respective dates as of which information is given
in the Registration Statement or the Prospectus, there has not been any
material adverse change in the condition, financial or otherwise, of
Lincoln or the Account supporting the Contracts described in the
Registration Statement that would cause such information to be materially
misleading.
(7) Lincoln has been duly organized and is validly existing as a
corporation in good standing under the laws of Indiana, with full power and
authority to own, lease and operate its properties and conduct its business
in the manner described in the Prospectus, is duly qualified to transact
the business of a life insurance company and is validly existing or in good
standing in each State in which the Contracts are or will be offered.
(8) Each Account supporting the Contracts described in the Registration
Statement has been duly authorized and established and is validly existing
as an insurance company separate account under the laws of Indiana and is
duly registered with the SEC as a unit investment trust under the 0000 Xxx.
(9) The form of the Contracts has been (or, before it is offered for
sale, will be) approved to the extent required by the Indiana Insurance
Commissioner and by the governmental agency responsible for regulating
insurance companies in each other State in which the Contracts are offered.
(10) The execution and delivery of this Agreement and the consummation of
the transactions contemplated in this Agreement have been duly authorized
by all necessary corporate action by Lincoln and when so executed and
delivered this Agreement will be
the valid and binding obligation of Lincoln enforceable in accordance
with its terms.
(11) Lincoln has filed with the SEC all statements and other documents
required for registration under the provisions of the 1940 Act and the
Regulations thereunder of the Account supporting the Contracts described in
the Registration Statement, and such registration has been, or, prior to
being offered to the public, will be, effected; there are no agreements or
documents required by the 1933 Act, the 1940 Act or the Regulations to be
filed with the SEC as exhibits to the Registration Statement, that have not
been so filed; and Lincoln has obtained all exemptive or other orders of
the SEC necessary to make the public offering and consummate the sale of
the Contracts pursuant to this Agreement and to permit the operation of the
Account supporting the Contracts described in the Registration Statement,
as contemplated in the Prospectus.
(12) The Contracts have been duly authorized by Lincoln and conform to
the descriptions thereof in the Registration Statement and the Prospectus
and, when issued as contemplated by the Registration Statement, will
constitute legal, validly issued and binding obligations of Lincoln in
accordance with their terms.
b. DELAWARE represents and warrants to Lincoln on the date hereof as
follows:
(1) DELAWARE has been duly organized and is validly existing as a
corporation in good standing under the laws of with full power and
authority to own, lease and operate its properties and conduct its
business as a broker-dealer registered with the SEC and with the
securities commission of every State where such registration is
required, and is a member in good standing of the NASD.
(2) DELAWARE has taken all action including, without limitation, those
necessary under its limited partnership agreement, by-laws and
applicable state law, necessary to authorize the execution,
delivery and performance of this Agreement
and all transactions contemplated hereunder.
(3) DELAWARE is and during the term of this Agreement shall remain duly
registered as a broker-dealer under the 1934 Act, a member in good
standing with the NASD, and duly registered as a broker-dealer under
applicable state securities laws.
6. ADDITIONAL RESPONSIBILITIES OF LINCOLN
a. Lincoln shall:
(1) maintain the registration of the Contracts with the SEC and any
state securities commissions of any State where the securities or blue-sky
laws of such State require registration of the Contracts, including without
limitation using its best efforts to prevent a stop order from being issued
or if a stop order has been issued using its best efforts to cause such
stop order to be withdrawn;
(2) maintain the approval or other authorization of the Contract forms
where required under the insurance laws and regulations of each State
(provided, however, that it shall be within Lincoln's discretion whether to
obtain such approval or authorization in Hawaii, Guam, the U.S. Virgin
Islands, Puerto Rico, and American Samoa);
(3) keep such registration, approval and authorization in effect
thereafter so long as the Contracts are outstanding; and
(4) build, maintain and pay for the illustration and asset allocation
software programs for the Contracts.
b. During the term of this Agreement, Lincoln shall take all action required
to cause each class of Contracts to comply, and to continue to comply, as
annuity contracts or life insurance contracts, as the case may be, and to
cause the Registration Statement and the Prospectus for each class of
Contracts to comply, and to continue to comply, with all applicable federal
laws and regulations and all applicable laws and regulations of each State.
x. Xxxxxxx, during the term of this Agreement, shall notify DELAWARE
immediately:
(1) When each Registration Statement (or amendment or supplement to it)
has become effective;
(2) Of the initiation of any legal proceeding commenced by any
regulatory body or by any third party alleging that any material statement
made in a Registration Statement or a Prospectus is untrue in any material
respect or results in a material omission in a Registration Statement or a
Prospectus;
(3) Of the issuance by the SEC of any stop order with respect to a
Registration Statement or any amendment thereto; or the initiation of any
proceedings for that purpose or for any other purpose relating to the
registration and/or offering of the Contracts (or class of Contracts);
(4) Of all those States in which registration of the Contracts (or
class of Contracts) is required under the securities or blue-sky laws, and
the date on which such registrations have become effective.
x. Xxxxxxx shall furnish to DELAWARE without charge, promptly after filing,
one copy of each Registration Statement as originally filed, including
financial statements and all exhibits (including exhibits incorporated
therein by reference).
x. Xxxxxxx shall file in a timely manner all reports, statements and
amendments required to be filed by or for each Account or class of
Contracts under the 1933 Act and/or the 1940 Act or the Regulations.
x. Xxxxxxx shall provide DELAWARE access to such records, officers and
employees of Lincoln and of each Account at reasonable times as is
necessary to enable DELAWARE to fulfill its obligations under the federal
securities laws, Regulations and NASD rules.
6.5 ADDITIONAL RESPONSIBILITIES OF DELAWARE
DELAWARE shall:
a. assist Lincoln with certain administrative activities relating to the
Contracts, to the extent
agreed upon from time to time by Lincoln and DELAWARE.
b. provide Lincoln access to such of its records, officers and employees at
reasonable times as is necessary to enable Lincoln to fulfill its
obligations under the federal securities laws, Regulations and NASD rules.
7. INTELLECTUAL PROPERTY RIGHTS OF DELAWARE AND LINCOLN
The intellectual property rights of the parties are set forth in Exhibits B and
C of this Agreement, which are hereby incorporated herein by this reference.
8. RECORDS. Lincoln and DELAWARE each shall maintain such accounts, books and
other documents as are required to be maintained by each of them by applicable
laws and regulations and shall preserve such accounts, books and other documents
for the periods prescribed by such laws and regulations. The accounts, books
and records of Lincoln, the Account and DELAWARE as to all transactions
hereunder shall be maintained so as to clearly and accurately disclose the
nature and details of the transactions, including such accounting information as
necessary to support the reasonableness of the amounts paid by Lincoln
hereunder. Each party shall have the right to inspect and audit such accounts,
books and records of the other party during normal business hours upon
reasonable written notice to the other party. Each party shall keep
confidential all information obtained pursuant to such an inspection or audit,
and shall disclose such information to third parties only upon receipt of
written authorization from the other party, except as required under compulsion
of law.
9. COMPENSATION
a. BASIS. (1) Lincoln shall compensate DELAWARE for sales of the Contracts by
the Brokers pursuant to Schedule 9.a to this Agreement, as such Schedule
may be amended from time to time upon mutual agreement of the parties to
this Agreement. Such compensation shall be based on Purchase Payments
received and accepted by Lincoln for all Contracts issued on applications
obtained by the Brokers or any of their respective Representatives.
Lincoln will pay compensation due DELAWARE in accordance with the
procedures set forth on Schedule 9.a. The compensation provided for in this
Section 9
shall cease after the termination date of the Agreement.
(2) If Lincoln informs DELAWARE that any State by insurance rule,
regulation or statute, prohibits any payment of compensation by Lincoln
to a class of business entities including DELAWARE, DELAWARE shall
designate in writing a business entity or natural person, including an
insurance agency affiliate of DELAWARE meeting the requirements of such
State, to receive any amounts that may otherwise be payable to DELAWARE
hereunder, and Lincoln shall have the right to rely upon the legality of
all such designations. DELAWARE may change such designation from time
to time, upon prior written notice to Lincoln. Any payments made by
Lincoln to any person or entity so designated by DELAWARE shall
discharge Lincoln's liability to DELAWARE hereunder.
(3) If a purchaser rescinds a Contract or exercises a right to surrender
a contract for return of all Purchase Payments, DELAWARE will repay to
Lincoln, on demand, the amount of any compensation it received on the
Purchase Payments returned.
b. INDEBTEDNESS. Nothing in this Agreement shall be construed as giving
DELAWARE the right to incur any indebtedness on behalf of Lincoln.
c. APPOINTMENT FEES. TO BE DETERMINED.
d. REPORTING. DELAWARE shall be responsible for all tax reporting information
that DELAWARE is required to provide under applicable tax law to its
Associated Persons with respect to the Contracts. Nothing contained in
this Agreement or any sales agreement with a Broker is to be construed to
require DELAWARE to provide any tax reporting information directly or
indirectly to any unaffiliated Broker or its Representatives.
10. INVESTIGATION AND PROCEEDINGS
a. Lincoln and DELAWARE will cooperate fully in any securities or insurance
governmental or regulatory investigation or proceeding or judicial
proceeding arising in connection with the offering, sale or distribution of
the Contracts for which DELAWARE acts as wholesaler pursuant to this
Agreement. Without limiting the foregoing, DELAWARE agrees to notify
Lincoln promptly of any customer complaint or notice of any governmental or
regulatory investigation or proceeding or judicial proceeding, relating to
the Contracts, received by DELAWARE and involving Lincoln, DELAWARE or any
of their respective Associated Persons or that may affect Lincoln's
issuance of any Contract for which DELAWARE acts as wholesaler pursuant to
this Agreement.
b. In the case of a substantive customer complaint DELAWARE will provide
Lincoln with all available information and will cooperate generally in
Lincoln's investigation of the complaint.
11. INDEMNIFICATION.
a. Lincoln shall indemnify and hold harmless DELAWARE and any officer,
director, employee or agent of DELAWARE, against any and all losses,
claims, damages or liabilities (including reasonable investigative, and
legal expenses incurred in connection with any action, suit or proceeding,
or any amount paid in settlement thereof with the prior approval of
Lincoln), to which DELAWARE and/or such person may become subject, under
any statute or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities:
(1) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in any Registration
Statement, Prospectus, Blue Sky application or other document executed
by Lincoln specifically for the purpose of qualifying any or all of the
Contracts for sale under the securities laws of the United States or any
State; promotional, sales or advertising material for the Contracts; or
the Contracts themselves (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in
light of the
circumstances in which they were made; provided that this obligation to
indemnify shall not apply if such untrue statement or omission or such
alleged untrue statement or alleged omission was made in reliance upon
and in conformity with information furnished in writing to Lincoln by
DELAWARE
(2) arise out of or are based upon any untrue statement or alleged
untrue statement or omission or alleged omission of a material fact by
or on behalf of Lincoln (other than statements or representations
contained in any Fund Registration Statement, Fund Prospectus or
promotional, sales or advertising material of a Fund that were not
supplied by Lincoln or by persons under its control) or the gross
negligence or intentional misconduct of Lincoln or persons under its
control with respect to the sale or distribution of the Contracts; or
(3) result because of the terms of any Contract or because of any
material breach by Lincoln of any terms of this Agreement or of any
Contract or that proximately result from any activities of Lincoln's
officers, directors, employees or agents or their failure to take action
in connection with the sale of a Contract, to the extent of Lincoln's
obligations under this Agreement or otherwise, or the processing or
administration of the Contracts. This indemnification obligation will be
in addition to any liability that Lincoln may otherwise have; provided,
however, that no person shall be entitled to indemnification pursuant to
this Section 11.a if such loss, claim, damage or liability is due to the
willful misfeasance, bad faith, gross negligence or reckless disregard
of duty by the person seeking indemnification.
b. DELAWARE shall indemnify and hold harmless Lincoln and any officer,
director, employee or agent of Lincoln, against any and all losses, claims,
damages or liabilities, joint or several (including any investigative,
legal and other expenses reasonably incurred in connection with, and any
amounts paid in settlement of, any action, suit or proceeding
or any claim asserted), to which Lincoln and/or any such person may
become subject under any statute or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities arise
out of or are based upon:
(1) any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement, Prospectus or blue-sky
application or other document executed by Lincoln specifically for the
purposes of qualifying any or all of the Contracts for sale under the
securities law of any State (or any amendment or supplement to the
foregoing), or omission or alleged omission to state therein a material
fact required to be stated therein or necessary in order to make the
statements therein not misleading, in light of the circumstances in
which they were made, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity
with information furnished in writing to Lincoln by DELAWARE
specifically for use in the preparation of any such Registration
Statement, Prospectus, such blue-sky application or other document (or
any such amendment or supplement thereto); or
(2) any use of promotional, sales or advertising material for the
Contracts not authorized by Lincoln pursuant to Section 4.a(2) of this
Agreement or any verbal or written misrepresentations or any unlawful sales
practices concerning the Contracts by DELAWARE under federal securities
laws or NASD regulations (but not including state insurance laws,
compliance with which is a responsibility of Lincoln under this Agreement
or otherwise); or
(3) claims by agents, representatives or employees of DELAWARE for
commissions or other compensation or remuneration of any type; or
(4) any material breach by DELAWARE of any provision of this Agreement.
This indemnification obligation will be in addition to any liability that
DELAWARE may otherwise have; provided, however, that no person shall be
entitled to indemnification pursuant to this Section 11.b if such loss,
claim, damage or liability is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty
by the person seeking indemnification.
c. After receipt by a party entitled to indemnification ("indemnified party")
under this Section 11 of notice of the commencement of any action, if a
claim in respect thereof is to be made by the indemnified party against any
person obligated to provide indemnification under this Section 11
("indemnifying party"), such indemnified party will notify the indemnifying
party in writing of the commencement thereof as soon as practicable
thereafter, provided that the omission to so notify the indemnifying party
will not relieve it from any liability under this Section 11, except to the
extent that the omission results in a failure of actual notice to the
indemnifying party and such indemnifying party is damaged solely as a
result of the failure to give such notice. The indemnifying party, upon
the request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party
and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to
the retention of such counsel, or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party shall indemnify the indemnified party
from and against any loss or liability by reason of such
settlement or judgment.
d. The indemnification provisions contained in this Section 11 shall remain
operative in full force and effect, regardless of (i) any investigation
made by or on behalf of Lincoln or by or on behalf of any controlling
person thereof, (ii) delivery of any Contracts and Purchase Payments
therefor, or (iii) any termination of this Agreement. A successor by law
of DELAWARE or Lincoln, as the case may be, shall be entitled to the
benefits of the indemnification provisions contained in this Section 11.
12. TERMINATION
a. This Agreement may be terminated at the option of any party upon 90
calendar days' advance written notice to the other party;
b. This Agreement shall terminate automatically if it is assigned; provided,
however, that a transaction will not be deemed an assignment if it does not
result in a change of actual control or management of a party. This
Agreement may be terminated at the option of one party upon the other
party's material breach of any provision of this Agreement.
c. Upon termination of this Agreement all authorizations, rights and
obligations shall cease except: (i) the obligation to settle accounts
hereunder, including incurred compensation; and (ii) the provisions
contained in Sections 7 and 11 of this Agreement, except that Section 11
shall survive only for acts which occurred prior to termination.
13. RIGHTS, REMEDIES, ETC, ARE CUMULATIVE. 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. Failure
of one party to insist upon strict compliance by the other party with any of the
conditions of this Agreement in any one instance shall not be construed as a
waiver of any of the conditions for any subsequent instance, but the same shall
remain in full force and effect. No waiver of any of the provisions of this
Agreement shall be deemed, or shall constitute, a waiver
of any other provisions, whether or not similar, nor shall any waiver
constitute a continuing waiver.
14. NOTICES. All notices hereunder are to be in writing and shall be given,
if to Lincoln, to:
if to DELAWARE:
Xxxxxx X. X'Xxxxx
Delaware Distributors, L.P.
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Any party may specify another address in writing. Each such notice to a
party shall be hand-delivered; or transmitted by postage prepaid registered
or certified United States mail, with return receipt requested; or sent by an
overnight courier service; or sent by facsimile or similar electronic means
of delivery (with confirming copy by first class postage pre-paid U.S. mail.)
Notices shall be effective upon receipt.
15. INTERPRETATION, JURISDICTION, ETC. This Agreement constitutes the
whole agreement between the parties to this Agreement relating to the
wholesaling activities contemplated in this Agreement, and supersedes all
prior oral or written negotiations between the parties to this Agreement with
respect to the subject matter of this Agreement. The parties acknowledge
that Lincoln and the Funds have entered into Participation Agreements and
that it may be necessary to construe the terms of such Participation
Agreements and this Agreement together. This Agreement shall be construed and
the provisions of this Agreement interpreted under and in accordance with the
internal laws of the State of Indiana without giving effect to principles of
conflict of laws.
16. HEADINGS. The headings 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.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
18. SEVERABILITY. This is a severable agreement and in the event that any part
or parts of this Agreement shall be held to be unenforceable to its or their
full extent, then it is the intention of the parties to this Agreement that such
part or parts shall be enforced to the extent permitted under the law, and, in
any event, that all other parts of this Agreement shall remain valid and duly
enforceable as if the unenforceable part or parts had never been a part of this
Agreement.19. REGULATION. This Agreement shall be subject to all applicable
provisions of state law and to the 1933 Act; 1934 Act; 1940 Act; and the
Regulations and the rules and regulations of the NASD, from time to time in
effect; including such exemptions from the 1940 Act as the SEC may grant. The
terms of this Agreement shall be interpreted and construed in accordance
therewith. Without limiting the generality of the foregoing, the term
"assigned" shall not include any transaction exempted from Section 15(b)(2) of
the 1940 Act.
IN WITNESS WHEREOF, each party hereto represents that the officer
signing this Agreement on the party's behalf is duly authorized to execute
this Agreement; and each party has caused this Agreement to be duly executed
by such authorized officer as of the date first set forth above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By:
-------------------------------
Name:
Title:
DELAWARE DISTRIBUTORS, INC.
as General Partner and on behalf
of DELAWARE DISTRIBUTORS, L.P.
By:
-------------------------------
Name:
Title:
Schedule 1.a
Separate Account Subaccounts
Available under the Contracts
Effective ___________ __, 1998
NAME OF SEPARATE ACCOUNT SUBACCOUNTS
Schedule 1.b
Contracts Subject to Wholesaling Agreement
Effective ______________ __, 1998
SEC
MARKETING POLICY REGISTRATION NAME OF
NAME OF CONTRACT FORM NO. NO. SEPARATE ACCOUNT
---------------- -------- ------------ ----------------
SCHEDULE 9.a
COMPENSATION SCHEDULE
EFFECTIVE __________ __, 1998
COMPENSATION PAYABLE BY LINCOLN TO DELAWARE FOR WHOLESALING ACTIVITY
All initial and subsequent ____%
Purchase Payments received
and accepted by Lincoln, while this Agreement remains in force.
Compensation will be paid to DELAWARE according to then current Lincoln
practice, but no less frequently than weekly.
Exhibit A (DISCUSSION DRAFT)
DELAWARE-LINCOLN CHOICEPLUS DISTRIBUTION OF RESPONSIBILITIES
-----------------------------------------------------------------------------------------------------------------------------------
TASK Delaware is Lincoln is Delaware Lincoln Delaware Lincoln
the Driver the Driver Pays Pays Maintains Maintains
-----------------------------------------------------------------------------------------------------------------------------------
PROSPECTUS RELATED:
-----------------------------------------------------------------------------------------------------------------------------------
Prepare Initial Registration Statement
-----------------------------------------------------------------------------------------------------------------------------------
File Initial registration Statement
-----------------------------------------------------------------------------------------------------------------------------------
Prepare Initial Prospectus cover page
-----------------------------------------------------------------------------------------------------------------------------------
Printing Initial Prospectus Cover Page
-----------------------------------------------------------------------------------------------------------------------------------
Prepare Initial Product Prospectus & SAI
Printing of Initial Product Prospectus & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Initial Product Prospectus & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Prepare Initial Mutual Fund Prospectuses & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Printing of initial Mutual Fund Prospectuses & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Initial Mutual fund Prospectuses & SAI
-----------------------------------------------------------------------------------------------------------------------------------
File & Obtain California Certificate of Authority Approval
-----------------------------------------------------------------------------------------------------------------------------------
prepare On-going Registration Statements
-----------------------------------------------------------------------------------------------------------------------------------
File On-going Registration Statements
-----------------------------------------------------------------------------------------------------------------------------------
Prepare On-going Prospectus Cover Page
-----------------------------------------------------------------------------------------------------------------------------------
Printing On-going Prospectus Cover Page
-----------------------------------------------------------------------------------------------------------------------------------
Prepare On-going Product Prospectus & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Printing On-going Product Prospectus & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of On-going Product Prospectuses & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Prepare On-going Product Mutual Fund Prospectuses & SAI
-----------------------------------------------------------------------------------------------------------------------------------
Printing of On-going Mutual Fund Prospectuses & SAI
Prepare Proxy
-----------------------------------------------------------------------------------------------------------------------------------
Printing of Proxy
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Proxy
-----------------------------------------------------------------------------------------------------------------------------------
CONTRACT AND APPLICATION
-----------------------------------------------------------------------------------------------------------------------------------
Prepare & file the Contract with the States and Obtain
Approval
-----------------------------------------------------------------------------------------------------------------------------------
Printing and Mailing of the Contracts
-----------------------------------------------------------------------------------------------------------------------------------
Delivery of the contracts
-----------------------------------------------------------------------------------------------------------------------------------
Develop the Application
-----------------------------------------------------------------------------------------------------------------------------------
File and Print the Application
-----------------------------------------------------------------------------------------------------------------------------------
SEMI-ANNUAL AND ANNUAL REPORTS:
-----------------------------------------------------------------------------------------------------------------------------------
Preparation of Semi-Annual & Annual Reports
-----------------------------------------------------------------------------------------------------------------------------------
printing of Semi-Annual & Annual Reports
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Semi-Annual & annual Reports
-----------------------------------------------------------------------------------------------------------------------------------
Letters and Fund Managers Comments (annuals & semi-annuals)
-----------------------------------------------------------------------------------------------------------------------------------
QUARTERLY PERFORMANCE REPORTS (PROFILE BOOK):
-----------------------------------------------------------------------------------------------------------------------------------
Size Definition
-----------------------------------------------------------------------------------------------------------------------------------
Layout
-----------------------------------------------------------------------------------------------------------------------------------
General Copy (not product related)
-----------------------------------------------------------------------------------------------------------------------------------
Fund/Manager Page Layout
-----------------------------------------------------------------------------------------------------------------------------------
SMR, Compliance and NASD Approvals
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Management Approval
-----------------------------------------------------------------------------------------------------------------------------------
Request Data from Fund Managers
-----------------------------------------------------------------------------------------------------------------------------------
Re-State Data
-----------------------------------------------------------------------------------------------------------------------------------
Input Adjusted Data into Page Layout Format
-----------------------------------------------------------------------------------------------------------------------------------
Final Approval of Quarterly Performance Report (Profile Book)
-----------------------------------------------------------------------------------------------------------------------------------
Printing of Quarterly Performance Report (Profile Book)
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Quarterly Performance Report (Profile Book)
-----------------------------------------------------------------------------------------------------------------------------------
MONTHLY PERFORMANCE REPORTS:
-----------------------------------------------------------------------------------------------------------------------------------
Layout
-----------------------------------------------------------------------------------------------------------------------------------
General Copy
-----------------------------------------------------------------------------------------------------------------------------------
SMR & Compliance Approvals
-----------------------------------------------------------------------------------------------------------------------------------
management Approval
-----------------------------------------------------------------------------------------------------------------------------------
Obtain Data from Fund Managers
-----------------------------------------------------------------------------------------------------------------------------------
Re-State Data
-----------------------------------------------------------------------------------------------------------------------------------
Input Adjusted Data into Page Layout format
-----------------------------------------------------------------------------------------------------------------------------------
Final Approval of Monthly Performance Report
-----------------------------------------------------------------------------------------------------------------------------------
Printing of Monthly Performance Report
-----------------------------------------------------------------------------------------------------------------------------------
Distribution of Monthly Performance Report
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Exhibit B
INTELLECTUAL PROPERTY RIGHTS OF DELAWARE
DELAWARE. Delaware Management Holdings, Inc. owns all right, title and
interest, including the good will associated therewith, in and to the marks
DELAWARE, DELAWARE GROUP, DELAWARE INVESTMENTS and DELAWARE GROUP PREMIUM
FUND, which may be used in connection with one or more of the underlying
investment mediums for the Contracts, and in and to the name DELAWARE in
whatever manner used in connection with the performance of this Agreement
(such marks are hereinafter referred to as "Delaware Licensed Marks").
Delaware Management Holdings, Inc. has granted to DELAWARE the right and
license to use the Delaware Licensed Marks and the right to sub-license
others. DELAWARE hereby grants to Lincoln a non-exclusive right and limited
license to use the Delaware Licensed Marks in connection with the Contracts
and Lincoln's performance of the services as set forth under this Agreement.
(1) TERM. The grant of limited license as specified in this
Section 7.b shall terminate with respect to a Delaware Licensed Xxxx on the
earlier of the following events: (A) a change of name of such Delaware
Licensed Xxxx to a name that does not include the term "Delaware": or (B)
solely at the option of DELAWARE, and respecting only new business, upon a
termination of this Agreement. In all other cases the grant of limited
license as specified in this Section 7.b shall survive the termination of the
Agreement. Upon termination of the grant of limited license, Lincoln shall,
within a reasonable time, cease to issue new Contracts or to use or
disseminate any promotional, sales or advertising material relating to the
Contracts under such Delaware Licensed Xxxx, and shall likewise cease any new
business activity that suggests that it has any right under such Delaware
Licensed Xxxx or that it has any association with DELAWARE in connection with
any such Contracts with respect to such Delaware Licensed Xxxx.
(2) PRE-RELEASE APPROVAL OF TRADEMARK-BEARING MATERIALS. (a)
Lincoln agrees that it will display the Delaware Licensed Marks only in such
form and manner as are specifically approved by DELAWARE and that it will
cause them to appear on all promotional, sales or advertising material used
in connection with the Contracts or related services with such legends,
markings and notices as DELAWARE may request in order to give appropriate
notice of service xxxx registration when effected. All such materials will
be submitted by Lincoln to Delaware for the purpose of service xxxx reviews
at least ten business days before their intended use by Lincoln . DELAWARE
shall have ten business days from the date of mailing of this material to
request modification. If DELAWARE makes no such request, the service xxxx
presentation in the materials as submitted will be deemed approved by
DELAWARE. (As indicated in Section 4 (a) (1), Lincoln retains ultimate
responsibility for approval of the materials as a whole.)
(b) During the term of this grant of limited license, DELAWARE may request that
Lincoln submit samples of any material bearing any of the Delaware Licensed
Marks that were previously approved by DELAWARE but, due to changed
circumstances, DELAWARE may wish to reconsider, or that were not previously
approved in the manner set forth above. If, on reconsideration or on initial
review, respectively, any such sample fails to meet with the written approval of
DELAWARE, then Lincoln shall immediately cease using or disseminating such
disapproved material. Lincoln shall obtain the prior written approval of
DELAWARE for the use of any new material developed to replace
the disapproved material, in the manner set forth above. All costs
associated with any such reconsideration will be borne by DELAWARE.
(3) ASSIGNMENT. This limited license is personal to Lincoln and
may not be assigned without the prior written consent of DELAWARE.
(4) BREACH. If Lincoln shall violate or fail to perform any of
its obligations under this limited license, DELAWARE shall have the right to
terminate this limited license upon 120 days written notice, and such notice
of termination shall become effective unless Lincoln shall completely remedy
the default within such 120-day period. Termination of the license under the
provisions of this paragraph shall be without prejudice to any other rights
that DELAWARE may have against Lincoln.
(5) DELAWARE'S RIGHTS. All rights in the Delaware Licensed Marks
other than those specifically granted herein are reserved by DELAWARE for its
own use and benefit. Upon the termination of this limited license, for any
reason whatsoever, all rights in the Delaware Licensed Marks and any service
xxxx registrations pertaining thereto shall automatically revert to DELAWARE.
Lincoln shall at any time, whether during or after the term of this limited
license, execute any documents reasonably required by DELAWARE to confirm
DELAWARE's ownership of all such rights.
Exhibit C
INTELLECTUAL PROPERTY RIGHTS OF LINCOLN
