AMENDED AND RESTATED
PARTICIPATION AGREEMENT
AMONG
MFS VARIABLE INSURANCE TRUST,
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
AND
MASSACHUSETTS FINANCIAL SERVICES COMPANY
THIS AGREEMENT, made and entered into this ____ day of June 2000, by
and among MFS VARIABLE INSURANCE TRUST, a Massachusetts business trust (the
"Trust"), THE LINCOLN NATIONAL LIFE INSURANCE COMPANY, an Indiana corporation
(the "Company") on its own behalf and on behalf of each of the segregated asset
accounts of the Company set forth in Schedule A hereto, as may be amended from
time to time (the "Accounts"), and MASSACHUSETTS FINANCIAL SERVICES COMPANY, a
Delaware corporation ("MFS").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered or will be registered under the Securities Act of
1933, as amended (the "1933 Act");
WHEREAS, shares of beneficial interest of the Trust are divided into
several series of shares, each representing the interests in a particular
managed pool of securities and other assets;
WHEREAS, certain series of shares of the Trust are divided into two
separate share classes, an Initial Class and a Service Class, and the Trust on
behalf of the Service Class has adopted a Rule 12b-1 plan under the 1940 Act
pursuant to which the Service Class pays a distribution fee;
WHEREAS, the series of shares of the Trust (each, a "Portfolio," and,
collectively, the "Portfolios") and the classes of shares of those Portfolios
(the "Shares") offered by the Trust to the Company and the Accounts are set
forth on Schedule A attached hereto;
WHEREAS, MFS is duly registered as an investment adviser under the
Investment Advisers Act of 1940, as amended and is the Trust's investment
adviser;
WHEREAS, the Company will issue certain variable annuity and/or
variable life insurance contracts (individually, the "Policy" or, collectively,
the "Policies") which, if required by applicable law, will be registered under
the 1933 Act;
WHEREAS, the Accounts are duly organized, validly existing segregated
asset accounts, established by resolution of the Board of Directors of the
Company, to set aside and invest assets attributable to the aforesaid variable
annuity and/or variable life insurance contracts that are allocated to the
Accounts (the Policies and the Accounts covered by this Agreement, and each
corresponding Portfolio
covered by this Agreement in which the Accounts invest, is specified in
Schedule A attached hereto as may be modified from time to time);
WHEREAS, the Company has registered or will register the Accounts as
unit investment trusts under the 1940 Act (unless exempt therefrom);
WHEREAS, MFS Fund Distributors, Inc. (the "Underwriter") is registered
as a broker-dealer with the Securities and Exchange Commission (the "SEC") under
the Securities Exchange Act of 1934, as amended (hereinafter the "1934 Act"),
and is a member in good standing of the National Association of Securities
Dealers, Inc. (the "NASD");
WHEREAS, the Company, the underwriter for the Policies, is registered
as a broker-dealer with the SEC under the 1934 Act and is a member in good
standing of the NASD; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase the Shares of the Portfolios as
specified in Schedule A attached hereto (the "Shares") on behalf of the Accounts
to fund the Policies, and the Trust intends to sell such Shares to the Accounts
at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Trust,
MFS, and the Company agree as follows:
ARTICLE I. SALE AND REDEMPTION OF TRUST SHARES
-----------------------------------
1.1. The Trust agrees to sell to the Company those Shares which the
Accounts order (based on orders placed by Policy holders on that
Business Day, as defined below) and which are available for purchase by
such Accounts, executing such orders on a daily basis at the net asset
value next computed after receipt by the Trust or its designee of the
order for the Shares. For purposes of this Section 1.1, the Company
shall be the designee of the Trust for receipt of such orders from
Policy owners and receipt by such designee shall constitute receipt by
the Trust; PROVIDED that the Trust receives notice of such orders by
9:30 a.m. New York time on the next following Business Day. "Business
Day" shall mean any day on which the New York Stock Exchange, Inc. (the
"NYSE") is open for trading and on which the Trust calculates its net
asset value pursuant to the rules of the SEC.
1.2. The Trust agrees to make the Shares available indefinitely for
purchase at the applicable net asset value per share by the Company and
the Accounts on those days on which the Trust calculates its net asset
value pursuant to rules of the SEC and the Trust shall calculate such
net asset value on each day which the NYSE is open for trading.
Notwithstanding the foregoing, the Board of Trustees of the Trust (the
"Board") may refuse to sell any Shares to the Company and the Accounts,
or suspend or terminate the offering of the Shares if such action is
required by law or by regulatory authorities having jurisdiction or is,
in the sole discretion of the Board acting in good faith and in light
of its fiduciary duties under federal and any applicable state laws,
necessary in the best interest of the Shareholders of such Portfolio.
1.3. The Trust and MFS agree that the Shares will be sold only to
insurance companies which have entered into participation agreements
with the Trust and MFS (the "Participating Insurance Companies") and
their separate accounts, qualified pension and retirement plans and MFS
or its
-2-
affiliates. The Trust and MFS will not sell Trust shares to any
insurance company or separate account unless an agreement containing
provisions substantially the same as Articles III and VII of this
Agreement is in effect to govern such sales. The Company will not
resell the Shares except to the Trust or its agents.
1.4. The Trust agrees to redeem for cash, on the Company's request, any
full or fractional Shares held by the Accounts (based on orders placed
by Policy owners on that Business Day), executing such requests on a
daily basis at the net asset value next computed after receipt by the
Trust or its designee of the request for redemption. For purposes of
this Section 1.4, the Company shall be the designee of the Trust for
receipt of requests for redemption from Policy owners and receipt by
such designee shall constitute receipt by the Trust; provided that the
Trust receives notice of such request for redemption by 9:30 a.m. New
York time on the next following Business Day.
1.5. Each purchase, redemption and exchange order placed by the Company
shall be placed separately for each Portfolio and shall not be netted
with respect to any Portfolio. However, with respect to payment of the
purchase price by the Company and of redemption proceeds by the Trust,
the Company and the Trust shall net purchase and redemption orders with
respect to each Portfolio and shall transmit one net payment for all of
the Portfolios in accordance with Section 1.6 hereof.
1.6. In the event of net purchases, the Company shall pay for the
Shares by 2:00 p.m. New York time on the next Business Day after an
order to purchase the Shares is made in accordance with the provisions
of Section 1.1. hereof. In the event of net redemptions, the Trust
shall pay the redemption proceeds by 2:00 p.m. New York time on the
next Business Day after an order to redeem the shares is made in
accordance with the provisions of Section 1.4. hereof. All such
payments shall be in federal funds transmitted by wire.
1.7. Issuance and transfer of the Shares will be by book entry only.
Stock certificates will not be issued to the Company or the Accounts.
The Shares ordered from the Trust will be recorded in an appropriate
title for the Accounts or the appropriate subaccounts of the Accounts.
1.8. The Trust shall furnish same day notice (by wire or telephone
followed by written confirmation) to the Company of any dividends or
capital gain distributions payable on the Shares. The Company hereby
elects to receive all such dividends and distributions as are payable
on a Portfolio's Shares in additional Shares of that Portfolio, but may
revoke that election at any time by notifying the Trust in writing. The
Trust shall notify the Company of the number of Shares so issued as
payment of such dividends and distributions.
1.9. The Trust or its custodian shall make the net asset value per
share for each Portfolio available to the Company on each Business Day
as soon as reasonably practical after the net asset value per share is
calculated and shall use its best efforts to make such net asset value
per share available by 6:30 p.m. New York time. In the event that the
Trust is unable to meet the 6:30 p.m. time stated herein, it shall
provide additional time for the Company to place orders for the
purchase and redemption of Shares. Such additional time shall be equal
to the additional time which the Trust takes to make the net asset
value available to the Company. If the Trust provides materially
incorrect share net asset value information, the Trust shall make an
adjustment to the number of shares purchased or redeemed for the
Accounts to reflect the correct net asset value per share. Any material
error in the calculation or reporting of net asset value per share,
dividend or capital gains information shall be reported promptly upon
discovery to the Company.
-3-
-4-
ARTICLE II. CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS
-------------------------------------------------
2.1. The Company represents and warrants that the Policies are or will
be registered under the 1933 Act or are exempt from or not subject to
registration thereunder, and that the Policies will be issued, sold,
and distributed in compliance in all material respects with all
applicable state and federal laws, including without limitation the
1933 Act, the Securities Exchange Act of 1934, as amended (the "1934
Act"), and the 1940 Act. The Company further represents and warrants
that it is an insurance company duly organized and validly existing
under applicable law and that it has legally and validly established
the Account as a segregated asset account under applicable law and has
registered or, prior to any issuance or sale of the Policies, will
register the Accounts as unit investment trusts in accordance with the
provisions of the 1940 Act (unless exempt therefrom) to serve as
segregated investment accounts for the Policies, and that it will
maintain such registration for so long as any Policies are outstanding.
The Company shall amend the registration statements under the 1933 Act
for the Policies and the registration statements under the 1940 Act for
the Accounts from time to time as required in order to effect the
continuous offering of the Policies or as may otherwise be required by
applicable law. The Company shall register and qualify the Policies for
sales in accordance with the securities laws of the various states only
if and to the extent deemed necessary by the Company.
2.2. The Company represents and warrants that the Policies are
currently and at the time of issuance will be treated as life insurance
policies, endowment or annuity contracts under applicable provisions of
the Internal Revenue Code of 1986, as amended (the "Code"), that it
will maintain such treatment and that it will notify the Trust or MFS
immediately upon having a reasonable basis for believing that the
Policies have ceased to be so treated or that they might not be so
treated in the future.
2.3. The Company represents and warrants that it, as the underwriter
for the Policies, is a member in good standing of the NASD and is a
registered broker-dealer with the SEC. The Company represents and
warrants that, to the extent it sells the Policies directly, it will
sell and distribute such policies in accordance in all material
respects with all applicable state and federal securities laws,
including without limitation the 1933 Act, the 1934 Act, and the 0000
Xxx.
2.4. The Trust and MFS represent and warrant that the Shares sold
pursuant to this Agreement shall be registered under the 1933 Act, duly
authorized for issuance and sold in compliance with the laws of The
Commonwealth of Massachusetts and all applicable federal and state
securities laws and that the Trust is and shall remain registered under
the 1940 Act. The Trust shall amend the registration statement for its
Shares under the 1933 Act and the 1940 Act from time to time as
required in order to effect the continuous offering of its Shares. The
Trust shall register and qualify the Shares for sale in accordance with
the laws of the various states only if and to the extent deemed
necessary by the Trust.
2.5. MFS represents and warrants that the Underwriter is a member in
good standing of the NASD and is registered as a broker-dealer with the
SEC. The Trust and MFS represent that the Trust and the Underwriter
will sell and distribute the Shares in accordance in all material
respects with all applicable state and federal securities laws,
including without limitation the 1933 Act, the 1934 Act, and the 1940
Act.
-5-
2.6. The Trust represents that it is lawfully organized and validly
existing under the laws of The Commonwealth of Massachusetts and that
it does and will comply in all material respects with the 1940 Act and
any applicable regulations thereunder.
2.7. MFS represents and warrants that it is and shall remain duly
registered under all applicable federal securities laws and that it
shall perform its obligations for the Trust in compliance in all
material respects with any applicable federal securities laws and with
the securities laws of The Commonwealth of Massachusetts. MFS
represents and warrants that it is not subject to state securities laws
other than the securities laws of The Commonwealth of Massachusetts and
that it is exempt from registration as an investment adviser under the
securities laws of The Commonwealth of Massachusetts.
2.8. The Company shall submit to the Board such reports, material or
data as the Board may reasonably request from time to time so that it
may carry out fully the obligations imposed upon it by the conditions
contained in the exemptive application pursuant to which the SEC has
granted exemptive relief to permit mixed and shared funding (the "Mixed
and Shared Funding Exemptive Order").
ARTICLE III. PROSPECTUS AND PROXY STATEMENTS; VOTING
---------------------------------------
3.1. At least annually, the Trust or its designee shall provide the
Company, free of charge, with as many copies of the current prospectus
(describing only the Portfolios listed in Schedule A hereto) for the
Shares as the Company may reasonably request for distribution to
existing Policy owners whose Policies are funded by such Shares. The
Trust or its designee shall provide the Company, at the Company's
expense, with as many copies of the current prospectus for the Shares
as the Company may reasonably request for distribution to prospective
purchasers of Policies. If requested by the Company in lieu thereof,
the Trust or its designee shall provide such documentation (including a
"camera ready" copy of the new prospectus as set in type or, at the
request of the Company, as a diskette in the form sent to the financial
printer) and other assistance as is reasonably necessary in order for
the parties hereto once each year (or more frequently if the prospectus
for the Shares is supplemented or amended) to have the prospectus for
the Policies and the prospectus for the Shares printed together in one
document; the expenses of such printing to be apportioned between (a)
the Company and (b) the Trust or its designee in proportion to the
number of pages of the Policy and Shares' prospectuses, taking account
of other relevant factors affecting the expense of printing, such as
covers, columns, graphs and charts; the Trust or its designee to bear
the cost of printing the Shares' prospectus portion of such document
for distribution to owners of existing Policies funded by the Shares
and the Company to bear the expenses of printing the portion of such
document relating to the Accounts; PROVIDED, however, that the Company
shall bear all printing expenses of such combined documents where used
for distribution to prospective purchasers or to owners of existing
Policies not funded by the Shares. In the event that the Company
requests that the Trust or its designee provides the Trust's prospectus
in a "camera ready" or diskette format, the Trust shall be responsible
for providing the prospectus in the format in which it or MFS is
accustomed to formatting prospectuses and shall bear the expense of
providing the prospectus in such format (E.G., typesetting expenses),
and the Company shall bear the expense of adjusting or changing the
format to conform with any of its prospectuses.
3.2. The prospectus for the Shares shall state that the statement of
additional information for the Shares is available from the Trust or
its designee. The Trust or its designee, at its expense,
-6-
shall print and provide such statement of additional information to
the Company (or a master of such statement suitable for duplication
by the Company) for distribution to any owner of a Policy funded by
the Shares. The Trust or its designee, at the Company's expense,
shall print and provide such statement to the Company (or a master
of such statement suitable for duplication by the Company) for
distribution to a prospective purchaser who requests such statement
or to an owner of a Policy not funded by the Shares.
3.3. The Trust or its designee shall provide the Company free of charge
copies, if and to the extent applicable to the Shares, of the Trust's
proxy materials, reports to Shareholders and other communications to
Shareholders in such quantity as the Company shall reasonably require
for distribution to Policy owners.
3.4. Notwithstanding the provisions of Sections 3.1, 3.2, and 3.3
above, or of Article V below, the Company shall pay the expense of
printing or providing documents to the extent such cost is considered a
distribution expense. Distribution expenses would include by way of
illustration, but are not limited to, the printing of the Shares'
prospectus or prospectuses for distribution to prospective purchasers
or to owners of existing Policies not funded by such Shares.
3.5. The Trust hereby notifies the Company that it may be appropriate
to include in the prospectus pursuant to which a Policy is offered
disclosure regarding the potential risks of mixed and shared funding.
3.6. If and to the extent required by law, the Company shall:
(a) solicit voting instructions from Policy owners;
(b) vote the Shares in accordance with instructions
received from Policy owners; and
(c) vote the Shares in each separate Account for which no
instructions have been received in the same
proportion as the Shares of such Portfolio in such
Account for which instructions have been received
from Policy owners;
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. The Company will in no way recommend action in
connection with or oppose or interfere with the solicitation of proxies
for the Shares held for such Policy owners. The Company reserves the
right to vote shares held in any segregated asset account in its own
right, to the extent permitted by law. Participating Insurance
Companies shall be responsible for assuring that each of their separate
accounts holding Shares calculates voting privileges in the manner
required by the Mixed and Shared Funding Exemptive Order. The Trust and
MFS will notify the Company of any changes of interpretations or
amendments to the Mixed and Shared Funding Exemptive Order.
ARTICLE IV. SALES MATERIAL AND INFORMATION
------------------------------
4.1. The Company shall furnish, or shall cause to be furnished, to the
Trust or its designee, each piece of sales literature or other
promotional material in which the Trust, MFS, any other investment
adviser to the Trust, or any affiliate of MFS are named, at least ten
(10) Business Days
-7-
prior to its use. No such material shall be used if the Trust, MFS, or
their respective designees reasonably objects to such use within
five (5) Business Days after receipt of such material.
4.2. The Company shall not give any information or make any
representations or statement on behalf of the Trust, MFS, any other
investment adviser to the Trust, or any affiliate of MFS or concerning
the Trust or any other such entity in connection with the sale of the
Policies other than the information or representations contained in the
registration statement, prospectus or statement of additional
information for the Shares, as such registration statement, prospectus
and statement of additional information may be amended or supplemented
from time to time, or in reports or proxy statements for the Trust, or
in sales literature or other promotional material approved by the
Trust, MFS or their respective designees, except with the permission of
the Trust, MFS or their respective designees. The Trust, MFS or their
respective designees each agrees to respond to any request for approval
on a prompt and timely basis. The Company shall adopt and implement
procedures reasonably designed to ensure that information concerning
the Trust, MFS or any of their affiliates which is intended for use
only by brokers or agents selling the Policies (I.E., information that
is not intended for distribution to Policy owners or prospective Policy
owners) is so used, and neither the Trust, MFS nor any of their
affiliates shall be liable for any losses, damages or expenses relating
to the improper use of such broker only materials.
4.3. The Trust or its designee shall furnish, or shall cause to be
furnished, to the Company or its designee, each piece of sales
literature or other promotional material in which the Company and/or
the Accounts is named, at least ten (10) Business Days prior to its
use. No such material shall be used if the Company or its designee
reasonably objects to such use within five (5) Business Days after
receipt of such material.
4.4. The Trust and MFS shall not give, and agree that the Underwriter
shall not give, any information or make any representations on behalf
of the Company or concerning the Company, the Accounts, or the Policies
in connection with the sale of the Policies other than the information
or representations contained in a registration statement, prospectus,
or statement of additional information for the Policies, as such
registration statement, prospectus and statement of additional
information may be amended or supplemented from time to time, or in
reports for the Accounts, or in sales literature or other promotional
material approved by the Company or its designee, except with the
permission of the Company. The Company or its designee agrees to
respond to any request for approval on a prompt and timely basis. The
parties hereto agree that this Section 4.4. is neither intended to
designate nor otherwise imply that MFS is an underwriter or distributor
of the Policies.
4.5. The Company and the Trust (or its designee in lieu of the Company
or the Trust, as appropriate) will each provide to the other at least
one complete copy of all registration statements, prospectuses,
statements of additional information, reports, proxy statements, sales
literature and other promotional materials, applications for
exemptions, requests for no-action letters, and all amendments to any
of the above, that relate (in the case of the Trust) to the Policies,
or (in the case of the Company) to the Trust or its Shares, within
twenty (20) days after the filing of such document with the SEC or
other regulatory authorities. The Company and the Trust shall also each
promptly inform the other of the results of any examination by the SEC
(or other regulatory authorities) that relates to the Policies, the
Trust or its Shares, and the party that was the subject of the
examination shall provide the other party with a copy of relevant
portions of any "deficiency letter" or other correspondence or written
report regarding any such examination.
-8-
4.6. The Trust and MFS will provide the Company with as much notice as
is reasonably practicable of any proxy solicitation for any Portfolio,
and of any material change in the Trust's registration statement,
particularly any change requiring change to the registration statement
or prospectus or statement of additional information for any Account.
The Trust and MFS will cooperate with the Company so as to enable the
Company to solicit proxies from Policy owners or to make changes to its
prospectus, statement of additional information or registration
statement, in an orderly manner. The Trust and MFS will make reasonable
efforts to attempt to have changes affecting Policy prospectuses become
effective simultaneously with the annual updates for such prospectuses.
4.7. For purpose of this Article IV and Article VIII, the phrase "sales
literature or other promotional material" includes but is not limited
to 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, or other public media), and sales literature (such as
brochures, circulars, reprints or excerpts or any other advertisement,
sales literature, or published articles), distributed or made generally
available to customers or the public, educational or training materials
or communications distributed or made generally available to some or
all agents or employees.
ARTICLE V. FEES AND EXPENSES
-----------------
5.1. The Trust shall pay no fee or other compensation to the Company
under this Agreement, and the Company shall pay no fee or other
compensation to the Trust, except that, to the extent the Trust or any
Portfolio has adopted and implemented a plan pursuant to Rule 12b-1
under the 1940 Act to finance distribution and for Shareholder
servicing expenses, then the Trust may make payments to the Company or
to the underwriter for the Policies in accordance with such plan. Each
party, however, shall, in accordance with the allocation of expenses
specified in Articles III and V hereof, reimburse other parties for
expenses initially paid by one party but allocated to another party. In
addition, nothing herein shall prevent the parties hereto from
otherwise agreeing to perform, and arranging for appropriate
compensation for, other services relating to the Trust and/or to the
Accounts.
5.2. The Trust or its designee shall bear the expenses for the cost of
registration and qualification of the Shares under all applicable
federal and state laws, including preparation and filing of the Trust's
registration statement, and payment of filing fees and registration
fees; preparation and filing of the Trust's proxy materials and reports
to Shareholders; setting in type and printing its prospectus and
statement of additional information (to the extent provided by and as
determined in accordance with Article III above); setting in type and
printing the proxy materials and reports to Shareholders (to the extent
provided by and as determined in accordance with Article III above);
the preparation of all statements and notices required of the Trust by
any federal or state law with respect to its Shares; all taxes on the
issuance or transfer of the Shares; and the costs of distributing the
Trust's prospectuses and proxy materials to owners of Policies funded
by the Shares and any expenses permitted to be paid or assumed by the
Trust pursuant to a plan, if any, under Rule 12b-1 under the 1940 Act.
The Trust shall not bear any expenses of marketing the Policies.
5.3. The Company shall bear the expenses of distributing the Shares'
prospectus or prospectuses in connection with new sales of the Policies
and of distributing the Trust's
-9-
Shareholder reports to Policy owners. The Company shall bear all
expenses associated with the registration, qualification, and filing
of the Policies under applicable federal securities and state
insurance laws; the cost of preparing, printing and distributing the
Policy prospectus and statement of additional information to other
than existing Policy owners; and the cost of preparing, printing and
distributing annual individual account statements for Policy owners
as required by state insurance laws.
ARTICLE VI. DIVERSIFICATION AND RELATED LIMITATIONS
---------------------------------------
6.1. The Trust and MFS represent and warrant that each Portfolio of the
Trust will meet the diversification requirements of Section 817 (h) (1)
of the Code and Treas. Reg. 1.817-5, relating to the diversification
requirements for variable annuity, endowment, or life insurance
contracts, as they may be amended from time to time (and any revenue
rulings, revenue procedures, notices, and other published announcements
of the Internal Revenue Service interpreting these sections), as if
those requirements applied directly to each such Portfolio.
6.2. The Trust and MFS represent that each Portfolio will elect to be
qualified as a Regulated Investment Company under Subchapter M of the
Code and that they will maintain such qualification (under Subchapter M
or any successor or similar provision), and will notify the Company if
it appears that any Portfolio will not so qualify.
ARTICLE VII. POTENTIAL MATERIAL CONFLICTS
----------------------------
7.1. The Trust agrees that the Board, constituted with a majority of
disinterested trustees, will monitor each Portfolio of the Trust for
the existence of any material irreconcilable conflict between the
interests of the variable annuity contract owners and the variable life
insurance policy owners of the Company and/or affiliated companies
("contract owners") investing in the Trust. The Board shall have the
sole authority to determine if a material irreconcilable conflict
exists, and such determination shall be binding on the Company only if
approved in the form of a resolution by a majority of the Board, or a
majority of the disinterested trustees of the Board. The Board will
give prompt notice of any such determination to the Company.
7.2. The Company agrees that it will be responsible for assisting the
Board in carrying out its responsibilities under the conditions set
forth in the Trust's exemptive application pursuant to which the SEC
has granted the Mixed and Shared Funding Exemptive Order by providing
the Board, as it may reasonably request, with all information necessary
for the Board to consider any issues raised and agrees that it will be
responsible for promptly reporting any potential or existing conflicts
of which it is aware to the Board including, but not limited to, an
obligation by the Company to inform the Board whenever contract owner
voting instructions are disregarded. The Company also agrees that if it
is determined by a majority of the Trustees, or a majority of the
disinterested Trustees, that a material irreconcilable conflict exists,
the Company shall, at its own expense and to the extent reasonably
practicable (as determined by a majority of the disinterested Trustees)
take whatever steps are necessary to remedy or eliminate the material
irreconcilable conflict, which steps include: (a) withdrawing the
assets allocable to some or all of the Accounts from the Trust or any
Portfolio and reinvesting such
-10-
assets in a different investment medium, including (but not limited
to) another Portfolio of the Trust, or submitting to a vote of all
affected contract owners whether to withdraw assets from the Trust
or any Portfolio and reinvesting such assets in a different
investment medium and, as appropriate, segregating the assets
attributable to any appropriate group of contract owners that votes
in favor of such segregation, or offering to any of the affected
contract owners the option of segregating the assets attributable to
their contracts or policies, and (b) establishing a new registered
management investment company and segregating the assets underlying
the Policies, unless a majority of Policy owners materially
adversely affected by the conflict have voted to decline the offer
to establish a new registered management investment company.
7.3. A majority of the disinterested trustees of the Board shall
determine whether any proposed action by the Company adequately
remedies any material irreconcilable conflict. In the event that the
Board determines that any proposed action does not adequately remedy
any material irreconcilable conflict, the Company will withdraw from
investment in the Trust each of the Accounts designated by the
disinterested trustees and terminate this Agreement within six (6)
months after the Board informs the Company in writing of the foregoing
determination; PROVIDED, HOWEVER, that such withdrawal and termination
shall be limited to the extent required to remedy any such material
irreconcilable conflict as determined by a majority of the
disinterested trustees of the Board.
7.4. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision
of the 1940 Act or the rules promulgated thereunder with respect to
mixed or shared funding (as defined in the Mixed and Shared Funding
Exemptive Order) on terms and conditions materially different from
those contained in the Mixed and Shared Funding Exemptive Order, then
(a) the Trust and/or the Participating Insurance Companies, as
appropriate, shall take such steps as may be necessary to comply with
Rule 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the
extent such rules are applicable; and (b) Sections 3.5, 3.6, 7.1, 7.2,
7.3 and 7.4 of this Agreement shall continue in effect only to the
extent that terms and conditions substantially identical to such
Sections are contained in such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
---------------
8.1. INDEMNIFICATION BY THE COMPANY
------------------------------
The Company agrees to indemnify and hold harmless the Trust,
MFS, any affiliates of MFS, and each of their respective
directors/trustees, officers and each person, if any, who controls the
Trust or MFS within the meaning of Section 15 of the 1933 Act, and any
agents or employees of the foregoing (each an "Indemnified Party," or
collectively, the "Indemnified Parties" for purposes of this Section
8.1) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Company) or expenses (including reasonable counsel fees) to which any
Indemnified Party may become subject under any statute, regulation, at
common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements
are related to the sale or acquisition of the Shares or the Policies
and:
(a) arise out of or are based upon any untrue
statement or alleged untrue statement of any
material fact contained in the registration
statement, prospectus or statement of additional
information for the Policies or contained in the
Policies or sales literature or other promotional
material for the Policies (or any amendment or
-11-
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 PROVIDED that
this agreement to indemnify shall not apply as to
any Indemnified Party if such statement or omission
or such alleged statement or omission was made in
reasonable reliance upon and in conformity with
information furnished to the Company or its
designee by or on behalf of the Trust or MFS for
use in the registration statement, prospectus or
statement of additional information for the
Policies or in the Policies or sales literature or
other promotional material (or any amendment or
supplement to any of the foregoing) or otherwise
for use in connection with the sale of the Policies
or Shares; or
(b) arise out of or as a result of statements or
representations (other than statements or
representations contained in the registration
statement, prospectus, statement of additional
information or sales literature or other promotional
material of the Trust not supplied by the Company or
its designee, or persons under its control and on
which the Company has reasonably relied) or wrongful
conduct of the Company or persons under its control,
with respect to the sale or distribution of the
Policies or Shares; or
(c) arise out of any untrue statement or alleged untrue
statement of a material fact contained in the
registration statement, prospectus, statement of
additional information, or sales literature or other
promotional literature of the Trust, or any amendment
thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact
required to be stated therein or necessary to make
the statement or statements therein not misleading,
if such statement or omission was made in reliance
upon information furnished to the Trust by or on
behalf of the Company; or
(d) arise out of or result from any material breach of
any representation and/or warranty made by the
Company in this Agreement or arise out of or result
from any other material breach of this Agreement by
the Company; or
(e) arise as a result of any failure by the Company to
provide the services and furnish the materials
under the terms of this Agreement;
as limited by and in accordance with the provisions of this
Article VIII.
8.2. INDEMNIFICATION BY THE TRUST
----------------------------
The Trust agrees to indemnify and hold harmless the Company
and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act,
and any agents or employees of the foregoing (each an "Indemnified
Party," or collectively, the "Indemnified Parties" for purposes of this
Section 8.2) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Trust) or expenses (including reasonable counsel fees) to which any
Indemnified Party may become subject under any statute, at common law
or otherwise, insofar as such losses, claims,
-12-
damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Shares or
the Policies and:
(a) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact
contained in the registration statement,
prospectus, statement of additional information or
sales literature or other promotional material of
the Trust (or any amendment or supplement to any of
the foregoing), or arise out of or are based upon
the omission or the alleged omission to state
therein a material fact required to be stated
therein or necessary to make the statement therein
not misleading, PROVIDED that this agreement to
indemnify shall not apply as to any Indemnified
Party if such statement or omission or such alleged
statement or omission was made in reasonable
reliance upon and in conformity with information
furnished to the Trust, MFS, the Underwriter or
their respective designees by or on behalf of the
Company for use in the registration statement,
prospectus or statement of additional information
for the Trust or in sales literature or other
promotional material for the Trust (or any
amendment or supplement to any of the foregoing) or
otherwise for use in connection with the sale of
the Policies or Shares; or
(b) arise out of or as a result of statements or
representations (other than statements or
representations contained in the registration
statement, prospectus, statement of additional
information or sales literature or other promotional
material for the Policies not supplied by the Trust,
MFS, the Underwriter or any of their respective
designees or persons under their respective control
and on which any such entity has reasonably relied)
or wrongful conduct of the Trust or persons under its
control, with respect to the sale or distribution of
the Policies or Shares; or
(c) arise out of any untrue statement or alleged untrue
statement of a material fact contained in the
registration statement, prospectus, statement of
additional information, or sales literature or
other promotional literature of the Accounts or
relating to the Policies, 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 the Company by or on
behalf of the Trust, MFS or the Underwriter; or
(d) arise out of or result from any material breach of
any representation and/or warranty made by the Trust
in this Agreement (including a failure, whether
unintentional or in good faith or otherwise, to
comply with the diversification requirements
specified in Article VI of this Agreement) or arise
out of or result from any other material breach of
this Agreement by the Trust; or
(e) arise out of or result from the materially incorrect
or untimely calculation or reporting of the daily net
asset value per share or dividend or capital gain
distribution rate; or
(f) arise as a result of any failure by the Trust to
provide the services and furnish the materials
under the terms of the Agreement;
-13-
as limited by and in accordance with the provisions of this
Article VIII.
8.3. In no event shall the Trust be liable under the indemnification
provisions contained in this Agreement to any individual or entity,
including without limitation, the Company, or any Participating
Insurance Company or any Policy holder, with respect to any losses,
claims, damages, liabilities or expenses that arise out of or result
from (i) a breach of any representation, warranty, and/or covenant made
by the Company hereunder or by any Participating Insurance Company
under an agreement containing substantially similar representations,
warranties and covenants; (ii) the failure by the Company or any
Participating Insurance Company to maintain its segregated asset
account (which invests in any Portfolio) as a legally and validly
established segregated asset account under applicable state law and as
a duly registered unit investment trust under the provisions of the
1940 Act (unless exempt therefrom); or (iii) the failure by the Company
or any Participating Insurance Company to maintain its variable annuity
and/or variable life insurance contracts (with respect to which any
Portfolio serves as an underlying funding vehicle) as life insurance,
endowment or annuity contracts under applicable provisions of the Code.
8.4. Neither the Company nor the Trust shall be liable under the
indemnification provisions contained in this Agreement with respect to
any losses, claims, damages, liabilities or expenses to which an
Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful misfeasance, willful misconduct, 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.
8.5. Promptly after receipt by an Indemnified Party under this Section
8.5. of notice of commencement of any action, such Indemnified Party
will, if a claim in respect thereof is to be made against the
indemnifying party under this section, notify the indemnifying party of
the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may
have to any Indemnified Party otherwise than under this section. In
case any such action is brought against any Indemnified Party, and it
notified the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, assume the defense thereof, with counsel
satisfactory to such Indemnified Party. After notice from the
indemnifying party of its intention to assume the defense of an action,
the Indemnified Party shall bear the expenses of any additional counsel
obtained by it, and the indemnifying party shall not be liable to such
Indemnified Party under this section for any legal or other expenses
subsequently incurred by such Indemnified Party in connection with the
defense thereof other than reasonable costs of investigation.
8.6. Each of the parties agrees promptly to notify the other parties of
the commencement of any litigation or proceeding against it or any of
its respective officers, directors, trustees, employees or 1933 Act
control persons in connection with the Agreement, the issuance or sale
of the Policies, the operation of the Accounts, or the sale or
acquisition of Shares.
8.7. A successor by law of the parties to this Agreement shall be
entitled to the benefits of the indemnification contained in this
Article VIII. The indemnification provisions contained in this Article
VIII shall survive any termination of this Agreement.
ARTICLE IX. APPLICABLE LAW
--------------
-14-
9.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of The Commonwealth
of Massachusetts.
9.2. This Agreement shall be subject to the provisions of the 1933,
1934 and 1940 Acts, and the rules and regulations and rulings
thereunder, including such exemptions from those statutes, rules and
regulations as the SEC may grant and the terms hereof shall be
interpreted and construed in accordance therewith.
ARTICLE X. NOTICE OF FORMAL PROCEEDINGS
----------------------------
The Trust, MFS, and the Company agree that each such party shall promptly
notify the other parties to this Agreement, in writing, of the institution of
any formal proceedings brought against such party or its designees by the NASD,
the SEC, or any insurance department or any other regulatory body regarding such
party's duties under this Agreement or related to the sale of the Policies, the
operation of the Accounts, or the purchase of the Shares.
ARTICLE XI. TERMINATION
-----------
11.1. This Agreement shall terminate with respect to the Accounts, or
one, some, or all Portfolios:
(a) at the option of any party upon six (6) months'
advance written notice to the other parties; or
(b) at the option of the Company to the extent that the
Shares of Portfolios are not reasonably available
to meet the requirements of the Policies or are not
"appropriate funding vehicles" for the Policies, as
reasonably determined by the Company. Without
limiting the generality of the foregoing, the
Shares of a Portfolio would not be "appropriate
funding vehicles" if, for example, such Shares did
not meet the diversification or other requirements
referred to in Article VI hereof; or if the Company
would be permitted to disregard Policy owner voting
instructions pursuant to Rule 6e-2 or 6e-3(T) under
the 1940 Act. Prompt notice of the election to
terminate for such cause and an explanation of such
cause shall be furnished to the Trust by the
Company; or
(c) at the option of the Trust or MFS upon institution of
formal proceedings against the Company by the NASD,
the SEC, or any insurance department or any other
regulatory body regarding the Company's duties under
this Agreement or related to the sale of the
Policies, the operation of the Accounts, or the
purchase of the Shares; or
(d) at the option of the Company upon institution of
formal proceedings against the Trust or MFS by the
NASD, the SEC, or any state securities or insurance
department or any other regulatory body regarding the
Trust's or MFS' duties under this Agreement or
related to the sale of the Shares; or
(e) at the option of the Company, the Trust or MFS upon
receipt of any necessary regulatory approvals and/or
the vote of the Policy owners having an interest in
the
-15-
Accounts (or any subaccounts) to substitute the
shares of another investment company for the
corresponding Portfolio Shares in accordance with the
terms of the Policies for which those Portfolio
Shares had been selected to serve as the underlying
investment media. The Company will give thirty (30)
days' prior written notice to the Trust of the Date
of any proposed vote or other action taken to replace
the Shares; or
(f) termination by either the Trust or MFS by written
notice to the Company, if either one or both of the
Trust or MFS respectively, shall determine, in their
sole judgment exercised in good faith, that the
Company has suffered a material adverse change in its
business, operations, financial condition, or
prospects since the date of this Agreement; or
(g) termination by the Company by written notice to the
Trust and MFS, if the Company shall determine, in its
sole judgment exercised in good faith, that the Trust
or MFS has suffered a material adverse change in this
business, operations, financial condition or
prospects since the date of this Agreement; or
(h) at the option of any party to this Agreement, upon
another party's material breach of any provision of
this Agreement; or
(i) upon assignment of this Agreement, unless made with
the written consent of the parties hereto.
11.2. The notice shall specify the Portfolio or Portfolios, Policies
and, if applicable, the Accounts as to which the Agreement is to be
terminated.
11.3. It is understood and agreed that the right of any party hereto to
terminate this Agreement pursuant to Section 11.1(a) may be exercised
for cause or for no cause. Termination by any party pursuant to any of
Section 11.1(b) through Section 11.1(i) shall not take effect until the
terminating party shall have provided written notice to the other
party.
11.4. Except as necessary to implement Policy owner initiated
transactions, or as required by state insurance laws or regulations,
the Company shall not redeem the Shares attributable to the Policies
(as opposed to the Shares attributable to the Company's assets held in
the Accounts), and the Company shall not prevent Policy owners from
allocating payments to a Portfolio that was otherwise available under
the Policies, until thirty (30) days after the Company shall have
notified the Trust of its intention to do so.
11.5. Notwithstanding any termination of this Agreement, the Trust and
MFS shall, at the option of the Company, continue to make available
additional shares of the Portfolios pursuant to the terms and
conditions of this Agreement, for all Policies in effect on the
effective date of termination of this Agreement (the "Existing
Policies"), except as otherwise provided under Article VII of this
Agreement. Specifically, without limitation, the owners of the Existing
Policies shall be permitted to transfer or reallocate investment under
the Policies, redeem investments in any Portfolio and/or invest in the
Trust upon the making of additional purchase payments under the
Existing Policies.
-16-
ARTICLE XII. NOTICES
-------
Any notice shall be sufficiently given when sent by registered or
certified mail, overnight courier or facsimile to the other party at the address
of such party set forth below or at such other address as such party may from
time to time specify in writing to the other party.
If to the Trust:
MFS VARIABLE INSURANCE TRUST
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxx, Secretary
If to the Company:
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Attn: Xxxxx X. Xxxxxxxxx
If to MFS:
MASSACHUSETTS FINANCIAL SERVICES COMPANY
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxx, General Counsel
ARTICLE XIII. MISCELLANEOUS
-------------
13.1. Subject to the requirement of legal process and regulatory
authority, each party hereto shall treat as confidential the names and
addresses of the owners of the Policies and all information reasonably
identified as confidential in writing by any other party hereto and,
except as permitted by this Agreement or as otherwise required by
applicable law or regulation, shall not disclose, disseminate or
utilize such names and addresses and other confidential information
without the express written consent of the affected party until such
time as it may come into the public domain.
13.2. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
13.3. This Agreement may be executed simultaneously in one or more
counterparts, each of which taken together shall constitute one and the
same instrument.
13.4. 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.
-17-
13.5. The Schedule attached hereto, as modified from time to time, is
incorporated herein by reference and is part of this Agreement.
13.6. Each party hereto shall cooperate with each other party in
connection with inquiries by appropriate governmental authorities
(including without limitation the SEC, the NASD, and state insurance
regulators) relating to this Agreement or the transactions contemplated
hereby.
13.7. The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled
to under state and federal laws.
13.8. A copy of the Trust's Declaration of Trust is on file with the
Secretary of State of The Commonwealth of Massachusetts. The Company
acknowledges that the obligations of or arising out of this instrument
are not binding upon any of the Trust's trustees, officers, employees,
agents or shareholders individually, but are binding solely upon the
assets and property of the Trust in accordance with its proportionate
interest hereunder. The Company further acknowledges that the assets
and liabilities of each Portfolio are separate and distinct and that
the obligations of or arising out of this instrument are binding solely
upon the assets or property of the Portfolio on whose behalf the Trust
has executed this instrument. The Company also agrees that the
obligations of each Portfolio hereunder shall be several and not joint,
in accordance with its proportionate interest hereunder, and the
Company agrees not to proceed against any Portfolio for the obligations
of another Portfolio.
-18-
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed hereto as of the date
specified above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By its authorized officer,
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxx
Second Vice President
MFS VARIABLE INSURANCE TRUST, ON BEHALF
OF THE PORTFOLIOS
By its authorized officer and not individually,
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
-------------------------------
Xxxxx X. Xxxxxxxxx, Xx.
Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
By: /s/ Xxxxxx X. Xxxxx
-------------------------------
Xxxxxx X. Xxxxx
Senior Executive Vice President and Secretary
-19-
As of July 15, 2000
SCHEDULE A
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE PARTICIPATION AGREEMENT
--------------------------------------
================================= ==================================== ========================== ===============================
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
================================= ==================================== ========================== ===============================
Lincoln Life Flexible |X| Variable Universal Life I Initial MFS Emerging Growth Series
Premium Variable Life |X| Lincoln Variable Universal Life MFS Total Return Series
Separate Account M |X| Lincoln Variable Universal Life MFS Utilities Series
Death Benefit (VUL)
Lincoln Life Flexible |X| Survivorship Variable Initial MFS Emerging Growth Series
Premium Variable Life Universal Life I MFS Total Return Series
Separate Account R |X| Lincoln Survivorship MFS Utilities Series
Variable Universal Life
Lincoln Life Variable Annuity |X| Lincoln ChoicePlus Initial MFS Emerging Growth Series
Account N |X| Lincoln Choice Plus Access Service MFS Total Return Series
|X| Lincoln ChoicePlus Bonus Service MFS Utilities Series
MFS Research Series
Lincoln Life Flexible |X| Corporate Specialty Markets Initial MFS Total Return Series
Premium Variable Life COLI Product (CVUL) MFS Utilities Series
Separate Account S FS Capital Opportunities Series
MFS Research Series
--------------------------------- ------------------------------------ -------------------------- -------------------------------
-20-
AMENDMENT TO
SCHEDULE A
AS OF JULY 15, 2001
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE
PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
--------------------------------------------------------------------------------------------------------------------------------
Lincoln National Multifund 1,2,3,4,5 Initial MFS Capital Opportunities
Variable Annuity MFS Emerging Growth
Account C MFS Total Return
MFS Utilities
Lincoln National GVA I, II, III Initial MFS Capital Opportunities
Variable Annuity MFS Emerging Growth
Account L MFS Total Return
MFS Utilities
Lincoln Life Flexible VUL I Initial MFS Emerging Growth
Premium Variable Life MFS Total Return
Account M MFS Utilities
Lincoln Life Flexible LVUL(CV) Initial MFS Capital Opporunities
Premium Variable Life LVUL(DB) MFS Emerging Growth
Account M LVUL(CV2) MFS Total Return
Money Guard MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access Service MFS Research
ChoicePlus Bonus MFS Total Return
ChoicePlus Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus Advance MFS Utilities
Lincoln Life Variable Annuity Group MultiFund Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Variable SVUL I Initial MFS Emerging Growth
Life Separate LSVUL MFS Total Return
Account R MFS Utilities
1
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
----------------------------------------------------------------------------------------------------------------------------------
Lincoln Life Flexible Premium LSVUL II Initial MFS Capital Opportunities
Variable Life Separate MFS Emerging Growth
Account R MFS Total Return
MFS Utilities
Lincoln Life Flexible LCVUL Initial MFS Capital Opportunities
Premium Variable Life LCVUL III MFS Emerging Growth
Account S MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
2
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE
PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
--------------------------------------------------------------------------------------------------------------------------------
Lincoln National Life Insurance Company Director Initial MFS Emerging Growth
Separate Account 65
Lincoln National Life Insurance Company Director Initial MFS Capital Opportunities
Separate Account 66
Lincoln National Life Insurance Company Director Initial MFS Utilities Series
Separate Account 67
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment
to this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By its authorized officer,
Date: By:/s/Xxxxxx X. Xxxxxxx
--------------------- -------------------------------------------
Name:Xxxxxx X. Xxxxxxx
Title:Second Vice Presidnet
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
Date: By:/s/Xxxxx X. Xxxxxxxxx, Xx.
--------------------- -------------------------------------------
Name:Xxxxx X. Xxxxxxxxx, Xx.
Title:Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: By:/s/Xxxxxx X. Xxxxx
--------------------- -------------------------------------------
Name:Xxxxxx X. Xxxxx
Title:Senior Executive Vice President
3
AMENDMENT TO
SCHEDULE A
AS OF MAY 1, 2003
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE
PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
------------------------------------------------------------------------------------------------------------------------------------
Lincoln National Variable Annuity Multifund 1,2,3,4,5 Initial MFS Capital Opportunities
Account C MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln National Variable Annuity GVA I, II, III Initial MFS Capital Opportunities
Account L MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Variable VUL I Initial MFS Emerging Growth
Life Account M MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Variable LVUL(CV) Initial MFS Capital Opporunities
Life Account M LVUL(DB) MFS Emerging Growth
LVUL(CV)-II MFS Total Return
LVUL(CV)-III MFS Utilities
LVUL(DB)-II
Money Guard
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access MFS Total Return
ChoicePlus Bonus MFS Utilities
Service MFS Capital Opportunities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus II Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Assurance (B Share) Service MFS Capital Opportunities
Account N ChoicePlus Assurance (C Share) MFS Emerging Growth
ChoicePlus Assurance (L Share) MFS Total Return
ChoicePlus Assurance (Bonus) MFS Utilities
1
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
------------------------------------------------------------------------------------------------------------------------------------
Lincoln Life Variable Annuity Group MultiFund Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Variable SVUL I Initial MFS Emerging Growth
Life Separate Account R LSVUL MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LSVUL II Initial MFS Capital Opportunities
Variable Life Separate Account R LSVUL III MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Variable LCVUL Initial MFS Capital Opportunities
Life Account S LCVUL III MFS Emerging Growth
Lincoln Corporate Variable 4 MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Variable Annuity SEI Service MFS Capital Opportunities
Account T SEI Select MFS Emerging Growth
MFS Total Return
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
Lincoln Life Flexible Premium Variable Lincoln Corporate Variable Initial MFS Capital Opportunities
Life Account Z Private Solutions MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln National Life Insurance Director Initial MFS Emerging Growth
Company Separate Account 65
Lincoln National Life Insurance Director Initial MFS Capital Opportunities
Company Separate Account 66
Lincoln National Life Insurance Director Initial MFS Utilities Series
Company Separate Account 67
2
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment to
this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By its authorized officer,
Date: 11/13/03 By: /s/ Rise X. X. Xxxxxx
------------ -----------------------------------------------
Name: Rise X. X. Xxxxxx
Title: Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
Date: 11/11/03 By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
------------ -----------------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: 11/11/03 By: /s/ Xxxxxxx X. Xxxxx
------------ -----------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
3
AMENDMENT TO
SCHEDULE A
AS OF JANUARY 1, 2005
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE
PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
------------------------------------------------------------------------------------------------------------------------------------
Lincoln National Variable Annuity Multi-Fund(R) 1,2,3,4,5 Initial MFS Capital Opportunities
Account C MFS Emerging Growth
MFS Total Return
MFS Utilities
Multi-Fund(R) Select Service MFS Utilities
(effective 7/1/04)
Lincoln National Variable Annuity GVA I, II, III Initial MFS Capital Opportunities
Account L MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL I Initial MFS Emerging Growth
Variable Life Account M MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LVUL(CV) Initial MFS Capital Opporunities
Variable Life Account M LVUL(DB) MFS Emerging Growth
LVUL(CV) II MFS Total Return
LVUL(CV) III MFS Utilities
LVUL(CV) (IV) (effective 10/27/04)
LVUL(DB)-II
LVUL(DB) IV (effective 10/27/04)
Money Guard
VUL(ONE) (effective 5/3/04)
Momentum VUL(ONE)
(effective 7/1/04)
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access MFS Total Return
ChoicePlus Bonus MFS Utilities
Service MFS Capital Opportunities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus II Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Assurance (B Share ) Service MFS Capital Opportunities
Account N ChoicePlus Assurance (C Share ) MFS Emerging Growth
ChoicePlus Assurance (L Share ) MFS Total Return
ChoicePlus Assurance (Bonus ) MFS Utilities
Momentum Income Option
(effective 1/1/2005)
1
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
------------------------------------------------------------------------------------------------------------------------------------
Lincoln Life Variable Annuity Group MultiFund Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL I Initial MFS Emerging Growth
Variable Life Separate Account R LSVUL MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LSVUL II Initial MFS Capital Opportunities
Variable Life Separate Account R LSVUL III MFS Emerging Growth
LSVUL IV (effective 7/23/04) MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LCVUL Initial MFS Capital Opportunities
Variable Life Account S LCVUL III MFS Emerging Growth
Lincoln Corporate Variable 4 MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Variable Annuity SEI Service MFS Capital Opportunities
Account T SEI Select MFS Emerging Growth
MFS Total Return
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable Initial MFS Capital Opportunities
Variable Life Account Z Private Solutions MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln National Life Insurance Director Initial MFS Emerging Growth
Company Separate Account 65
Lincoln National Life Insurance Director Initial MFS Capital Opportunities
Company Separate Account 66
Lincoln National Life Insurance Director Initial MFS Utilities Series
Company Separate Account 67
2
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment to
this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By its authorized officer,
Date: 1/12/05 By: /s/ Xxxxx X. Xxxxxxxx
-------------- ----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
Date: 1/4/05 By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
-------------- ----------------------------------------
Name: Xxxxx X. Xxxxxxxxx, Xx.
Title: Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: 1/4/05 By: /s/ Xxxxxxx X. Carp
-------------- ----------------------------------------
Name: Xxxxxxx X. Carp
Title: Senior Vice President & General Counsel
3
[MFS(SM) LOGO]
INVESTMENT MANAGEMENT(R)
MFS INVESTMENT MANAGEMENT
000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-0000
December 7, 2005
Xx. Xxxxx Xxxxxx
Lincoln National Life Insurance Co
0000 Xxxxx Xxxxxxx Xx
Xxxx Xxxxx, XX 00000-0000
Dear Xx. Xxxxx Xxxxxx:
The purpose of this letter is to amend each
Participation Agreement among
Massachusetts Financial Services Company ("MFS"), MFS Variable Insurance Trust
("VIT") and each of the insurance companies listed on the attached Appendix
(each, a "Company"), made and entered into as of the dates listed on the
Appendix (each, an "Agreement"). The amendment will enable VIT (i) to sell its
shares to additional qualified parties, including funds-of-funds operated by
certain insurance companies ("Funds-of-Funds"); and (ii) to make in-kind
redemptions.
Each Agreement currently permits VIT shares to be sold only to insurance
companies and their separate accounts and qualified pension and retirement plans
(as well as MFS and its affiliates). MFS and VIT intend to amend the Agreement
to allow sales of VIT shares to any other person or plan to the extent such
sales would not cause any Participating Insurance Company to violate the
diversification requirements of Section 817(h) of the Internal Revenue Code of
1986, as amended. Such an amendment would be sufficiently broad to permit sales
of VIT shares to Funds-of-Funds. As such, Article I, Section 1.3 of the
Agreement is amended to read as follows:
1.3 The Trust and MFS agree that the Shares will be sold only to
insurance companies which have entered into
participation agreements
with the Trust and MFS (the "Participating Insurance Companies") and
their separate accounts, qualified pension and retirement plans, MFS
or its affiliates, and any other person or plan permitted to hold
shares of the Trust pursuant to Treasury Regulation 1.817-5 without
impairing the ability of the Company, on behalf of its separate
accounts, to consider the Shares as constituting investments of the
separate accounts for the purpose of satisfying the diversification
requirements of Section 8l7(h). The Trust and MFS will not sell
Trust shares to any insurance company or separate account unless an
agreement containing provisions substantially the same as Articles
III and VII of this Agreement is in effect to govern such sales. The
Company will not resell the Shares except to the Trust or its
agents.
Currently, each Agreement provides only for cash redemptions. This amendment to
the Agreement will permit VIT to make in-kind redemptions in addition to cash
redemptions, to the extent permitted by law and as described in the VIT
Prospectus. The amendment is principally intended to permit in-kind redemptions
in the event of large-scale redemptions, such as those in connection with
substitutions. As such, Article I, Section 1.4 of the Agreement is amended to
read as follows:
1.4. The Trust agrees to redeem for cash or, to the extent permitted by
applicable law, in-kind, on the Company's request, any full or
fractional Shares held by the Accounts (based on orders placed by
Policy owners prior to the close of regular trading on the NYSE on
that Business Day), executing such requests on a daily basis at the
net asset value next computed after receipt by the Trust or its
designee of the request for redemption. For purposes of this Section
1.4, the Company shall be the designee of the Trust for receipt of
requests for redemption from Policy
owners and receipt by such designee shall constitute receipt by the
Trust; provided that the Trust receives notice of such request for
redemption by 9:00 a.m. New York time on the next following Business
Day.
Except as modified and amended above, each Agreement is hereby ratified and
confirmed in full force and effect accordance with its terms. All capitalized
terms not defined in this letter shall have the meanings ascribed to them in the
Agreement.
Please indicate your acceptance of these amendments by having the enclosed
copies of this letter signed where indicated below by an appropriate officer of
each Company and return an executed copy at your earliest convenience.
Should you have any questions regarding these amendments, please contact Xxxx
Xxxxxxx, Vice President-Business Support & Development, at 617.954.5594 or Xxxxx
Xxxxxxx, Counsel, at 617.954.5843.
Very truly yours,
MASSACHUSETTS FINANCIAL SERVICES
COMPANY
By its authorized officer,
/s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx
Executive Vice President and
Director of Global Distribution
MFS VARIABLE INSURANCE TRUST
ON BEHALF OF THE PORTFOLIOS
By its authorized officer
and not individually.
/s/ Xxxxxxx X Xxxx
------------------
Xxxxxxx X Xxxx, Secretary
Accepted by:
LINCOLN NATIONAL LIFE INSURANCE COMPANY LINCOLN LIFE & ANNUITY COMPANY OF NEW
YORK
By: /s/ RISE' XX XXXXXX By: /s/ RISE' XX XXXXXX
------------------- ------------------
Name: RISE' XX XXXXXX Name: RISE' XX XXXXXX
Title: VICE PRESIDENT Title: SECOND VICE PRESIDENT
2
APPENDIX
NAME OF PARTICIPATING INSURANCE COMPANY DATE OF PARTICIPATION AGREEMENT
--------------------------------------- -------------------------------
Lincoln National Life Insurance Company May 22, 1998
Lincoln Life & Annuity Company of New York June 1, 2000
AMENDMENT TO
SCHEDULE A
AS OF APRIL 1, 2006
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
-----------------------------------------------------------------------------------------------------------------------------
Lincoln National Variable Annuity Multi-Fund(R) 1,2,3,4,5 Initial MFS Capital Opportunities
Account C MFS Emerging Growth
MFS Total Return
MFS Utilities
Multi-Fund(R) Select Service MFS Utilities
(effective 7/1/04)
Lincoln National Variable Annuity GVA I, II, III Initial MFS Capital Opportunities
Account L MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL I Initial MFS Emerging Growth
Variable Life Account M MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LVUL(CV) Initial MFS Capital Opporunities
Variable Life Account M LVUL(DB) MFS Emerging Growth
LVUL(CV) II MFS Total Return
LVUL(CV)III MFS Utilities
LVUL(CV) IV (effective 10/27/04)
LVUL(DB)-II
LVUL(DB) IV (effective 10/27/04)
Money Guard
VUL(ONE) (effective 5/3/04)
Momentum VUL(ONE)
(effective 7/1/04)
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access MFS Total Return
ChoicePlus Bonus MFS Utilities
Service MFS Capital Opportunities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus II Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Assurance (B Share) Service MFS Capital Opportunities
Account N ChoicePlus Assurance (C Share) MFS Emerging Growth
ChoicePlus Assurance (L Share) MFS Total Return
ChoicePlus Assurance (Bonus) MFS Utilities
Momentum Income Option
(effective 1/1/2005)
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
----------------------------------------------------------------------------------------------------------------------------
Lincoln Life Variable Annuity Group MultiFund Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL I Initial MFS Emerging Growth
Variable Life Separate Account R LSVUL MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LSVUL II Initial MFS Capital Opportunities
Variable Life Separate Account R LSVUL III MFS Emerging Growth
LSVUL IV (effective 7/23/04) MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium LCVUL Initial MFS Capital Opportunities
Variable Life Account S LCVUL III MFS Emerging Growth
Lincoln Corporate Variable 4 MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Variable Annuity SEI Service MFS Capital Opportunities
Account T SEI Select MFS Emerging Growth
MFS Total Return
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable Initial MFS Capital Opportunities
Variable Life Account Z Private Solutions MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln National Life Insurance Director Initial MFS Emerging Growth
Company Separate Account 65
Lincoln National Life Insurance Director Initial MFS Capital Opportunities
Company Separate Account 66
Lincoln National Life Insurance Director Initial MFS Utilities Series
Company Separate Account 67
Lincoln Life Separate Account 4k Lincoln American Legacy Service MFS Research
Retirement Group Variable International Series
Annuity MFS Total Return
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment to
this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By its authorized officer,
Date: 4/3/06 By: /s/ Rise X.X. Xxxxxx
------------------------------------
Name: Rise X.X. Xxxxxx
Title: Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not
individually,
Date: 4/3/06 By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: 4/3/06 By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief Executive
Officer
AMENDMENT TO
SCHEDULE A
AS OF MAY 1, 2006
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
---------------------------------------------------------------------------------------------------------------------------
Lincoln National Variable Annuity Multi-Fund(R) 1,2,3,4,5 Initial MFS Capital Opportunities
Account C MFS Emerging Growth
MFS Total Return
MFS Utilities
Multi-Fund(R) Select Service MFS Utilities
Lincoln National Variable Annuity GVA I, II, III Initial MFS Capital Opportunities
Account L MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL I Initial MFS Emerging Growth
Variable Life Account M MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL(CV) Initial MFS Capital Opporunities
Variable Life Account M VUL(DB) MFS Emerging Growth
VUL(CV) II MFS Total Return
VUL(CV)III MFS Utilities
VUL(CV) IV
VUL(DB)-II
VUL(DB) IV
Money Guard
VUL(ONE)
Momentum VUL(ONE)
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access MFS Total Return
ChoicePlus Bonus MFS Utilities
Service MFS Capital Opportunities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus II Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Assurance (B Share) Service MFS Capital Opportunities
Account N ChoicePlus Assurance (C Share) MFS Emerging Growth
ChoicePlus Assurance (L Share) MFS Total Return
ChoicePlus Assurance (Bonus) MFS Utilities
Momentum Income Option
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
---------------------------------------------------------------------------------------------------------------------------
Lincoln Life Variable Annuity MultiFund(R) Group Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL I Initial MFS Emerging Growth
Variable Life Separate Account R SVUL MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL II Initial MFS Capital Opportunities
Variable Life Separate Account R SVUL III MFS Emerging Growth
SVUL IV MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVULONE Initial MFS Total Return
Variable Life Separate Account R Momentum SVULONE MFS Utilities
Lincoln Life Flexible Premium CVUL Initial MFS Capital Opportunities
Variable Life Account S CVUL III MFS Emerging Growth
Lincoln Corporate Variable 4 MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable 5 Initial MFS Total Return
Variable Life Account S MFS Utilities
Lincoln Life Variable Annuity IVA (formerly SEI) Service MFS Capital Opportunities
Account T IVA (formerly SEI Select) MFS Emerging Growth
MFS Total Return
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable Initial MFS Capital Opportunities
Variable Life Account Z Private Solutions MFS Emerging Growth
MFS Investors Trust
MFS Research
MFS Strategic Income
MFS Total Return
MFS Utilities
Lincoln National Life Insurance Director Initial MFS Emerging Growth
Company Separate Account 65
Lincoln National Life Insurance Director Initial MFS Capital Opportunities
Company Separate Account 66
Lincoln National Life Insurance Director Initial MFS Utilities Series
Company Separate Account 67
Lincoln Life Separate Account 4k Lincoln American Legacy Service MFS Research
Retirement Group Variable International Series
Annuity MFS Total Return
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment to
this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE
COMPANY
By its authorized officer,
Date: 7/31/06 By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not
individually,
Date: 7/27/06 By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: 7/27/06 By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief Executive
Officer
AMENDMENT TO
SCHEDULE A
AS OF OCTOBER 1, 2006
ACCOUNTS, POLICIES AND PORTFOLIOS
SUBJECT TO THE PARTICIPATION AGREEMENT
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
---------------------------------------------------------------------------------------------------------------------------
Lincoln National Variable Annuity Multi-Fund(R) 1,2,3,4,5 Initial MFS Capital Opportunities
Account C MFS Emerging Growth
MFS Total Return
MFS Utilities
Multi-Fund(R) Select Service MFS Utilities
Lincoln National Variable Annuity GVA I, II, III Initial MFS Capital Opportunities
Account L MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL I Initial MFS Emerging Growth
Variable Life Account M MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium VUL(CV) Initial MFS Capital Opporunities
Variable Life Account M VUL(DB) MFS Emerging Growth
VUL(CV) II MFS Total Return
VUL(CV)III MFS Utilities
VUL(CV) IV
VUL(DB)-II
VUL(DB) IV
Money Guard
VUL(ONE)
Momentum VUL(ONE)
Lincoln Life Variable Annuity ChoicePlus Initial MFS Emerging Growth
Account N ChoicePlus Access MFS Total Return
ChoicePlus Bonus MFS Utilities
Service MFS Capital Opportunities
Lincoln Life Variable Annuity ChoicePlus II Service MFS Capital Opportunities
Account N ChoicePlus II Access MFS Emerging Growth
ChoicePlus II Bonus MFS Total Return
ChoicePlus II Advance MFS Utilities
Lincoln Life Variable Annuity ChoicePlus Assurance (B Share) Service MFS Capital Opportunities
Account N ChoicePlus Assurance (C Share) MFS Emerging Growth
ChoicePlus Assurance (L Share) MFS Total Return
ChoicePlus Assurance (Bonus) MFS Utilities
Momentum Income Option
ChoicePlus Assurance (A Share)
NAME OF SEPARATE
ACCOUNT AND DATE POLICIES FUNDED SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
---------------------------------------------------------------------------------------------------------------------------
Lincoln Life Variable Annuity ChoicePlus Design Service MFS Total Return
Account N MFS Utilities
Lincoln Life Variable Annuity MultiFund(R) Group Initial MFS Capital Opportunities
Account Q MFS Emerging Growth
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL I Initial MFS Emerging Growth
Variable Life Separate Account R SVUL MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL II Initial MFS Capital Opportunities
Variable Life Separate Account R SVUL III MFS Emerging Growth
SVUL IV MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium SVUL(ONE) Initial MFS Total Return
Variable Life Separate Account R Momentum SVUL(ONE) MFS Utilities
Lincoln Life Flexible Premium CVUL Initial MFS Capital Opportunities
Variable Life Account S CVUL III MFS Emerging Growth
Lincoln Corporate Variable 4 MFS Research
MFS Total Return
MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable 5 Initial MFS Total Return
Variable Life Account S MFS Utilities
Lincoln Life Variable Annuity IVA (formerly SEI) Service MFS Capital Opportunities
Account T IVA (formerly SEI Select) MFS Emerging Growth
MFS Total Return
Lincoln Life Variable Annuity New Directions Core Service MFS Capital Opportunities
Account W New Directions Access MFS Emerging Growth
New Directions Access 4 MFS Utilities
Lincoln Life Flexible Premium Lincoln Corporate Variable Initial MFS Capital Opportunities
Variable Life Account Z Private Solutions MFS Emerging Growth
MFS Investors Trust
MFS Research
MFS Strategic Income
MFS Total Return
MFS Utilities
Lincoln National Life Insurance Director Initial MFS Emerging Growth
Company Separate Account 65
Lincoln National Life Insurance Director Initial MFS Capital Opportunities
Company Separate Account 66
Lincoln National Life Insurance Director Initial MFS Utilities Series
Company Separate Account 67
Lincoln Life Separate Account 4k Lincoln American Legacy Service MFS Research
Retirement Group Variable International Series
Annuity MFS Total Return
IN WITNESS WHEREOF, each of the parties hereto has caused the Amendment to
this Agreement to be executed in its name and on its behalf by its duly
authorized representative and its seal to be hereunder affixed hereto as of the
date specified above.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By its authorized officer,
Date: 10/11/06 By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
Date: 10/1/06 By: /s/ Xxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Assistant Secretary
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By its authorized officer,
Date: 10/1/06 By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
May 10, 2007
VIA Federal Express
MFS Variable Insurance Trust
Massachusetts Financial Services Company
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxx Xxxxx
Re: Notice of Change of Principal Underwriter
To our valued business partner:
MFS Variable Insurance Trust, Massachusetts Financial Services Company and
The Lincoln National Life Insurance Company ("Lincoln") are parties to an
Amended and Restated Participation Agreement (the "Agreement") dated June 30,
2000.
Effective May 1, 2007, Lincoln Financial Distributors, Inc., a broker-dealer
registered with the SEC under the Securities Exchange Act of 1934 and a
member in good standing of the National Association of Securities Dealers,
Inc., assumed the role of principal underwriter with respect to the Policies
listed in Schedule A of the Agreement.
Lincoln requests that you provide acknowledgement of this letter by signing
below and returning one executed original letter to Xxxx Xx Xxxxxxxxx, 0000
X. Xxxxxxx Xxxxxx, Xxxx Xxxxx, XX 00000. Thank you for your prompt attention
to this matter. If you have any questions, please feel free to contact Xxxx
Xx Xxxxxxxxx at 000-000-0000.
Sincerely,
/s/ Xxxxx X. Xxxxxxxxx
---------------------------
Xxxxx X. Xxxxxxxxx
Vice President
ACKNOWLEDGED and AGREED:
MASSACHUSETTS FINANCIAL SERVICES MFS(R) VARIABLE INSURANCE TRUST(SM)
COMPANY
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxx
----------------------------- -----------------------------
Name: Xxxxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxx
--------------------------- -----------------------------
Title: President Title: Senior Vice President
-------------------------- -----------------------------
Date: October 1, 2007 Date: October 1, 2007
--------------------------- ------------------------------
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
AMONG
MFS VARIABLE INSURANCE TRUST,
MFS VARIABLE INSURANCE TRUST II,
LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
AND
MFS FUND DISTRIBUTORS, INC.
THIS AGREEMENT, made and entered into this 1st day of January, 2011, by and
among MFS VARIABLE INSURANCE TRUST, a Massachusetts business trust (the
"Trust I"), MFS VARIABLE INSURANCE TRUST II, a Massachusetts business trust
(the "Trust II") (Trust I and Trust II each referred to, individually, as the
"Trust" and, collectively, as the "Trusts"), LINCOLN LIFE & ANNUITY COMPANY OF
NEW YORK (the "Company") on its own behalf and on behalf of each of the
segregated asset accounts set forth in Schedule B hereto, as may be amended
from time to time (the "Accounts"), and MFS Fund Distributors, Inc. ("MFD"),
a Delaware corporation. This Agreement shall amend and supersede the
Participation Agreement, dated June 1, 2000, as amended, by and among MFS
Variable Insurance Trust, the Company and Massachusetts Financial Services
Company ("MFS").
WHEREAS, each Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940
Act"), and its shares are registered or will be registered under the
Securities Act of 1933, as amended (the "1933 Act");
WHEREAS, shares of beneficial interest of each Trust are divided into
several series of shares, each representing the interests in a particular
managed pool of securities and other assets;
WHEREAS, certain series of shares of each Trust are divided into two
separate share classes, an Initial Class and a Service Class, and the Trust
on behalf of the Service Class has adopted a Rule 12b-1 plan under the 1940
Act pursuant to which the Service Class pays a distribution fee;
WHEREAS, the series of shares of each Trust (each, a "Portfolio," and,
collectively, the "Portfolios") and the classes of shares of those Portfolios
(the "Shares") offered by each Trust to the Company and the Accounts are set
forth on Schedule A attached hereto;
WHEREAS, MFD is registered as a broker-dealer with the Securities and
Exchange Commission (the "SEC") under the Securities Exchange Act of 1934, as
amended (hereinafter the "1934 Act"), and is a member in good standing of the
Financial Industry Regulatory Authority, Inc. (the "FINRA");
WHEREAS, the Company will issue certain variable annuity and/or variable
life insurance contracts (individually, the "Policy" or, collectively, the
"Policies") which, if required by applicable law, will be registered under
the 1933 Act;
WHEREAS, the Accounts are duly organized, validly existing segregated
asset accounts, established by resolution of the Board of Directors of the
Company, to set aside and invest assets attributable to the aforesaid
variable annuity and/or variable life insurance contracts that are allocated
to the Accounts (the Policies and the Accounts covered by this Agreement, and
each corresponding Portfolio covered by this Agreement in which the Accounts
invest, is specified in Schedule A attached hereto as may be modified from
time to time);
WHEREAS, the Company has registered or will register the Accounts as
unit investment trusts under the 1940 Act (unless exempt therefrom);
WHEREAS, Massachusetts Financial Services Company ("MFS") is duly
registered as an investment adviser under the Investment Advisers Act of
1940, as amended, and any applicable state securities law, and is each
Trust's investment adviser; and
WHEREAS, Lincoln Financial Distributors, Inc. ("LFD"), the underwriter
for the Policies, is registered as a broker-dealer with the SEC under the
1934 Act and is a Connecticut Corporation; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase the Shares of the Portfolios as
specified in Schedule A attached hereto on behalf of the Accounts to fund the
Policies, and the Trusts intend to sell such Shares to the Accounts at net
asset value; and
NOW, THEREFORE, in consideration of their mutual promises, each Trust,
MFD, and the Company agree as follows:
ARTICLE I. SALE OF TRUST SHARES
1.1. Each Trust agrees to sell to the Company those Shares which the Accounts
order (based on orders placed by Policy holders prior to the pricing time set
forth in the applicable Portfolio's prospectus, E.G., the close of regular
trading on the New York Stock Exchange, Inc. (the "NYSE") on that Business
Day, as defined below) and which are available for purchase by such Accounts,
executing such orders on a daily basis at the net asset value next computed
after receipt by the Trust or its designee of the order for the Shares. For
purposes of this Section 1.1, the Company shall be the designee of each Trust
for receipt of such orders from Policy owners and receipt by such designee
shall constitute receipt by each Trust; PROVIDED that such Trust receives
notice of such orders by 9:00 a m. New York time on the next following
Business Day. "Business Day" shall mean any day on which the NYSE is open for
trading and on which the Trust calculates its net asset value pursuant to the
rules of the SEC. The Company will ensure that orders for transactions in
Shares by Policy owners comply with each Portfolio's prospectus (including
statement of additional information) restrictions with respect to purchases,
redemptions and exchanges. The Company will not engage in, authorize or
facilitate market timing or late trading in Shares and will take all
reasonable steps necessary to identify and prevent market timing and late
trading in Shares by Policyholders.
1.2. Each Trust agrees to make the Shares available indefinitely for purchase
at the applicable net asset value per share by the Company and the Accounts
on those days on which the Trust calculates its net asset value pursuant to
rules of the SEC and each Trust shall calculate such net asset value on each
day which the NYSE is open for trading. Notwithstanding the foregoing, the
Board of Trustees of the relevant Trust (the "Board") may refuse to sell any
Shares to the Company and the Accounts, or suspend or terminate the offering
of the Shares if such action is required by law or by regulatory authorities
having jurisdiction or is, in the sole discretion of the Board acting in good
faith and in light of its fiduciary duties under federal and any applicable
state laws, necessary in the best interest of the Shareholders of such
Portfolio.
1.3. Each Trust and MFD agree that the Shares will be sold only to insurance
companies which have entered into participation agreements with the Trust and
MFD or its affiliates (the "Participating Insurance Companies") and their
separate accounts, qualified pension and retirement plans and MFD or its
affiliates, and any other person or plan permitted to hold shares of such
Trust pursuant to Treasury Regulation 1.817-5 without impairing the ability
of the Company, on behalf of its separate accounts, to consider the Shares as
constituting investments of the separate accounts for the purpose of
satisfying the diversification requirements of Section 817(h). Each Trust and
MFD or its affiliates will not sell such Trust shares to any insurance
company or separate account unless an agreement containing provisions
substantially the same as Articles III and VII of this Agreement is in effect
to govern such sales. The Company will not resell the Shares except to such
Trust or its agents.
1.4. Each Trust agrees to redeem for cash or, to the extent permitted by
applicable law, in-kind, on the Company's request, any full or fractional
Shares held by the Accounts (based on orders placed by Policy owners prior to
the close of regular trading on the NYSE on that Business Day), executing
such requests on a daily basis at the net asset value next computed after
receipt by such Trust or its designee of the request for redemption. For
purposes of this Section l.4, the Company shall be the designee of such Trust
for receipt of requests for redemption from Policy owners and receipt by such
designee shall constitute receipt by such Trust; provided that such Trust
receives notice of such request for redemption by 9:00 a.m. New York time on
the next following Business Day.
1.5. Each purchase, redemption and exchange order placed by the Company shall
be placed separately for each Portfolio and shall not be netted with respect
to any Portfolio. However, with respect to payment of the purchase price by
the Company and of redemption proceeds by the Trusts, the Company and the
relevant Trust shall net purchase and redemption orders with respect to each
Portfolio and shall transmit one net payment for all of the Portfolios in
accordance with Section 1.6 hereof.
1.6. In the event of net purchases, the Company shall use its best efforts to
pay for the Shares by 2:00 p.m. New York time on the next Business Day after
an order to purchase the Shares is made in accordance with the provisions of
Section 1.1. hereof. In the event of net redemptions, each Trust shall use
its best efforts to pay the redemption proceeds by 2:00 p.m. New York time on
the next Business Day after an order to redeem the shares is made in
accordance with the provisions of Section 1.4. hereof. All such payments
shall be in federal funds transmitted by wire.
1.7. Issuance and transfer of the Shares will be by book entry only. Stock
certificates will not be issued to the Company or the Accounts. The Shares
ordered from each Trust will be recorded in an appropriate title for the
Accounts or the appropriate subaccounts of the Accounts.
1.8. Each Trust shall furnish same day notice (by wire or telephone followed
by written confirmation) to the Company of any dividends or capital gain
distributions payable on the Shares. The Company hereby elects to receive all
such dividends and distributions as are payable on a Portfolio's Shares in
additional Shares of that Portfolio. Each Trust shall notify the Company of
the number of Shares so issued as payment of such dividends and distributions.
1.9. Each Trust or its custodian shall make the net asset value per share for
each Portfolio available to the Company on each Business Day as soon as
reasonably practicable after the net asset value per share is calculated and
shall use its best efforts to make such net asset value per share available
by 6:30 p.m. New York time. In the event that such Trust is unable to meet
the 6:30 p.m. time stated herein, it shall provide additional time for the
Company to place orders for the purchase and redemption of Shares. Such
additional time shall be equal to the additional time which such Trust takes
to make the net asset value available to the Company. If such Trust provides
materially incorrect share net asset value information, the Trust shall make
an adjustment to the number of shares purchased or redeemed for the Accounts
to reflect the correct net asset value per share. Any material error in the
calculation or reporting of net asset value per share, dividend or capital
gains information ("Pricing Error") shall be rep0l1ed promptly upon discovery
to the Company. Such Trust or MFD shall reimburse the Company for the
reasonable, documented, out-of-pocket additional costs made to adjust the
Accounts due to a Pricing Error.
1.10 Each party or its designee shall maintain and preserve all records as
required by law to be maintained and preserved in connection with providing
the services hereunder and in making Shares available to the Policy holders.
Upon the request of MFD or a Trust, the Company shall provide copies of all
the historical records relating to transactions between the Portfolios and
the Policy holders, written communications regarding the Portfolios to or
from such Policy holders' accounts and other materials, in each case to the
extent necessary for MFD or such Trust to meet its recordkeeping obligations
under applicable law or regulation, including to comply with any request of a
governmental body or self-regulatory organization.
ARTICLE II. CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS
2.1. The Company represents and warrants that the Policies are or will be
registered under the 1933 Act or are exempt from or not subject to
registration thereunder, and that the Policies will be issued, sold, and
distributed in compliance in all material respects with all applicable state
and federal laws, including without limitation the 1933 Act, the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the 1940 Act. The
Company further represents and warrants that it is an insurance company duly
organized and in good standing under applicable law and that it has legally
and validly established the Account as a segregated asset account under
applicable law and has registered or, prior to any issuance or sale of the
Policies, will register the Accounts as unit investment trusts in accordance
with the provisions of the 1940 Act (unless exempt therefrom) to serve as
segregated investment accounts for the Policies, and that it will maintain
such registration for so long as any Policies are outstanding. The Company
shall amend the registration statements under the 1933 Act for the Policies
and the registration statements under the 1940 Act for the Accounts from time
to time as required in order to effect the continuous offering of the
Policies or as may otherwise be required by applicable law. The Company shall
register and qualify the Policies for sales in accordance with the securities
laws of the various states only if and to the extent deemed necessary by the
Company.
2.2. The Company represents and warrants that the Policies currently are and,
at the time of issuance, will be treated as life insurance, endowment or
annuity contract under applicable provisions of the Internal Revenue Code of
1986, as amended (the "Code"), that it will maintain such treatment and that
it will notify the Trust or MFD immediately upon having a reasonable basis
for believing that the Policies have ceased to be so treated or that they
might not be so treated in the future.
2.3. The Company represents and warrants that LFD, the underwriter for the
individual variable annuity and the variable life policies, is a member in
good standing of FINRA and is a registered broker-dealer with the SEC. The
Company represents and warrants that the Company and LFD will sell and
distribute such policies in accordance in all material respects with all
applicable state and federal securities laws, including, without limitation,
the 1933 Act, the 1934 Act, and the 0000 Xxx.
2.4. Each Trust and MFD represent and warrant that the Shares sold pursuant
to this Agreement shall be registered under the 1933 Act, duly authorized for
issuance and sold in compliance with the laws of The Commonwealth of
Massachusetts and all applicable federal and state securities laws and that
such Trust is and shall remain registered under the 1940 Act. Each Trust
shall amend the registration statement for its Shares under the 1933 Act and
the 1940 Act from time to time as
required in order to effect the continuous offering of its Shares. Each Trust
shall register and qualify the Shares for sale in accordance with the laws of
the various states only if and to the extent deemed necessary by such Trust.
2.5. MFD represents and warrants that it is a member in good standing of
FINRA and is registered as a broker-dealer with the SEC. Each Trust and MFD
represent that such Trust and MFD will sell and distribute the Shares in
accordance in all material respects with all applicable state and federal
securities laws, including, without limitation, the 1933 Act, the 1934 Act,
and the 0000 Xxx.
2.6. Each Trust represents that it is lawfully organized and validly existing
under the laws of The Commonwealth of Massachusetts and that it does and will
comply in all material respects with the 1940 Act and any applicable
regulations thereunder.
2.7. MFD, on behalf of MFS, represents and warrants that MFS, as investment
adviser to the Trusts, is and shall remain duly registered under all
applicable federal securities laws and that it shall perform its obligations
for the Trusts in compliance in all material respects with any applicable
federal securities laws and with the securities laws of The Commonwealth of
Massachusetts. MFD represents and warrants that MFS is not subject to state
securities laws other than the securities laws of The Commonwealth of
Massachusetts and that it is exempt from registration as an investment
adviser under the securities laws of The Commonwealth of Massachusetts.
2.8. No less frequently than annually, the Company shall submit to each Board
such reports, material or data as such Board may reasonably request so that
it may carry out fully the obligations imposed upon it by the conditions
contained in the exemptive application pursuant to which the SEC has granted
exemptive relief to permit mixed and shared funding (the "Mixed and Shared
Funding Exemptive Order").
2.9. The Company acknowledges that, with respect to Service Class Shares of a
Portfolio, it or its affiliate(s) may receive payments under a Trust's Rule
12b-1 plan. The Company, and not the relevant Trust, MFD nor MFS, is
responsible for providing any disclosures relating to this Agreement and/or
payments made to the Company to Policy owners.
ARTICLE III. PROSPECTUS AND PROXY STATEMENTS; VOTING
3.1. At least annually, each Trust or its designee shall provide the Company,
free of charge, with as many copies of the current prospectus (describing
only the Portfolios listed in Schedule A hereto) for the Shares as the
Company may reasonably request for distribution to existing Policy owners
whose Policies are funded by such Shares. Each Trust or its designee shall
provide the Company with as many copies of the current prospectus for the
Shares as the Company may reasonably request for distribution to prospective
purchasers of Policies. If requested by the Company in lieu thereof, a Trust
or its designee shall provide such documentation (including a "camera ready"
copy of the new prospectus as set in type or, at the request of the Company,
as a diskette in the form sent to the financial printer) and other assistance
as is reasonably necessary in order for the parties hereto once each year
(or more frequently if the prospectus for the Shares is supplemented or
amended) to have the prospectus for the Policies and the prospectus for the
Shares printed together in one document; the expenses of such printing to be
apportioned between (a) the Company and (b) the relevant Trust(s) or its
designee in proportion to the number of pages of the Policy and Shares'
prospectuses, taking account of other relevant factors affecting the expense
of printing, such as covers, columns, graphs and charts; such Trust or its
designee to bear the cost of printing the Shares' prospectus portion of such
document for distribution to owners of existing
Policies funded by the Shares and the Company to bear the expenses of
printing the portion of such document relating to the Accounts; PROVIDED,
however, that the Company shall bear all printing expenses of such combined
documents where used for distribution to prospective purchasers or to owners
of existing Policies not funded by the Shares. In the event that the Company
requests that a Trust or its designee provides such Trust's prospectus in a
"camera ready" or electronic file format, such Trust shall be responsible for
providing the prospectus in the format in which it or MFD is accustomed to
formatting prospectuses and shall bear the expense of providing the
prospectus in such format (E.G., typesetting expenses), and the Company shall
bear the expense of adjusting or changing the format to conform with any of
its prospectuses.
3.2. The prospectus for the Shares shall state that the statement of
additional information for the Shares is available from the relevant Trust or
its designee. Each Trust or its designee, at its expense, shall print and
provide such statement of additional information to the Company (or a master
of such statement suitable for duplication by the Company) for distribution
to any owner of a Policy funded by the Shares. Each Trust or its designee,
at the Company's expense, shall print and provide such statement to the
Company (or a master of such statement suitable for duplication by the
Company) for distribution to a prospective purchaser who requests such
statement or to an owner of a Policy not funded by the Shares.
3.3. Each Trust or its designee shall provide the Company free of charge
copies, if and to the extent applicable to the Shares, of the Trust's proxy
materials, reports to Shareholders and other communications to Shareholders
in such quantity as the Company shall reasonably require for distribution to
Policy owners.
3.4. Notwithstanding the provisions of Sections 3.1, 3.2, and 3.3 above, or
of Article V below, the Company shall pay the expense of printing or
providing documents to the extent such cost is considered a distribution
expense. Distribution expenses would include by way of illustration, but are
not limited to, the printing of the Shares' prospectus or prospectuses for
distribution to prospective purchasers or to owners of existing Policies not
funded by such Shares.
3.5. Each Trust hereby notifies the Company that it may be appropriate to
include in the prospectus pursuant to which a Policy is offered disclosure
regarding the potential risks of mixed and shared funding.
3.6. To the extent required by law, the Company shall:
(a) solicit voting instructions from Policy owners;
(b) vote the Shares in accordance with instructions received from Policy owners;
and
(c) vote the Shares for which no instructions have been received in the same
proportion as the Shares of such Portfolio for which instructions have been
received from Policy owners;
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. The
Company will in no way recommend action in connection with or oppose or
interfere with the solicitation of proxies for the Shares held for such
Policy owners. The Company reserves the right to vote shares held in any
segregated asset account in its own right, to the extent permitted by law.
Participating Insurance Companies shall be responsible for assuring that each
of their separate accounts holding Shares calculates voting privileges in the
manner required by the Mixed and Shared Funding Exemptive Order. Each Trust
and MFD will notify the Company of any changes of interpretations or
amendments to the Mixed and Shared Funding Exemptive Order.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. The Company shall furnish, or shall cause to be furnished, to each Trust
or its designee, each piece of sales literature or other promotional material
in which such Trust, MFD, any investment adviser to such Trust, or any
affiliate of MFD are named, at least ten (10) Business Days prior to its use.
No such material shall be used if such Trust, MFD, or their respective
designees reasonably objects to such use within five (5) Business Days after
receipt of such material.
4.2. The Company shall not give any information or make any representations
or statement on behalf of any Trust, MFD, any investment adviser to any
Trust, or any affiliate of MFD or concerning such Trust or any other such
entity in connection with the sale of the Policies other than the information
or representations contained in the registration statement, prospectus or
statement of additional information for the Shares, as such registration
statement, prospectus and statement of additional information may be amended
or supplemented from time to time, or in reports or proxy statements for such
Trust, or in sales literature or other promotional material approved by such
Trust, MFD or their respective designees, except with the permission of the
Trust, MFD or their respective designees. Each Trust, MFD or their respective
designees each agrees to respond to any request for approval on a prompt and
timely basis. The Company shall adopt and implement procedures reasonably
designed to ensure that information concerning a Trust, MFD or any of their
affiliates which is intended for use only by brokers or agents selling the
Policies (I.E., information that is not intended for distribution to Policy
owners or prospective Policy owners) is so used, and neither the Trusts, MFD
nor any of their affiliates shall be liable for any losses, damages or
expenses relating to the improper use of such broker only materials.
4.3. Each Trust or its designee shall furnish, or shall cause to be
furnished, to the Company or its designee, each piece of sales literature or
other promotional material in which the Company and/or the Accounts is named,
at least ten (10) Business Days prior to its use. No such material shall be
used if the Company or its designee reasonably objects to such use within
five (5) Business Days after receipt of such material.
4.4. The Trusts and MFD shall not give any information or make any
representations on behalf of the Company or concerning the Company, the
Accounts, or the Policies in connection with the sale of the Policies other
than the information or representations contained in a registration
statement, prospectus, or statement of additional information for the
Policies, as such registration statement, prospectus and statement of
additional information may be amended or supplemented from time to time, or
in reports for the Accounts, or in sales literature or other promotional
material approved by the Company or its designee, except with the permission
of the Company. The Company or its designee agrees to respond to any request
for approval on a prompt and timely basis. The Trust and MFD may not alter
any material so provided by the Company or its designee (including, without
limitation, presenting or delivering such material in a different medium,
E.G., electronic or internet) without the prior written consent of the
Company. The parties hereto agree that this Section 4.4. is neither intended
to designate nor otherwise imply that MFD is an underwriter or distributor of
the Policies.
4.5. The Company and each Trust (or its designee in lieu of the Company or
such Trust, as appropriate) will each provide to the other at least one
complete copy of all registration statements, prospectuses, statements of
additional information, reports, proxy statements, sales literature and other
promotional materials, applications for exemptions, requests for no-action
letters, and all amendments to any of the above, that relate to the Policies,
or to such Trust or its Shares, prior to or contemporaneously with the filing
of such document with the SEC or other regulatory authorities. The Company
and a Trust shall also each promptly inform the other of the results of any
examination by the SEC (or other regulatory authorities) that relates to the
Policies, such Trust or its Shares, and the party that was the subject of the
examination shall provide the other party with a copy of relevant portions of
any "deficiency letter" or other correspondence or written report regarding
any such examination.
4.6. No party shall use any other party's names, logos, trademarks or service
marks, whether registered or unregistered, without the prior written consent
of such other party, or after written consent therefore has been revoked,
provided that separate consent is not required under this Section 4.6 to the
extent that consent to use a party's name, logo, trademark or service xxxx in
connection with a particular piece of advertising or sales literature has
previously been given by a party under Sections 4.2 and 4.4 of this
Agreement. The Company shall not use in advertising, publicly or otherwise
the name of the Trusts, MFD or any of their affiliates nor any trade name,
trademark, trade device, service xxxx, symbol or any abbreviation,
contraction or simulation thereof of the Trusts, MFD, or their affiliates
without the prior written consent of the Trust or MFD in each instance. The
Trusts and MFD shall not use in advertising, publicly or otherwise the name
of the Company or any of its affiliates nor any trade name, trademark, trade
device, service xxxx, symbol or any abbreviation, contraction or simulation
thereof of the Company or its affiliates without the prior written consent of
the Company in each instance.
4.7. Each Trust and MFD will provide the Company with as much notice as is
reasonably practicable of any proxy solicitation for any Portfolio, and of
any material change in such Trust's registration statement, particularly any
change resulting in change to the registration statement or prospectus or
statement of additional information for any Account. The Trust and MFD will
cooperate with the Company so as to enable the Company to solicit proxies
from Policy owners or to make changes to its prospectus, statement of
additional information or registration statement, in an orderly manner. Each
Trust and MFD will make reasonable efforts to attempt to have changes
affecting Policy prospectuses become effective simultaneously with the annual
updates for such prospectuses.
4.8. For purpose of this Article IV and Article VIII, the phrase "sales
literature or other promotional material" includes but is not limited to
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, or
other public media), and sales literature (such as brochures, circulars,
reprints or excerpts or any other advertisement, sales literature, or
published articles), distributed or made generally available to customers or
the public, educational or training materials or communications distributed
or made generally available to some or all agents or employees.
ARTICLE V. FEES AND EXPENSES
5.1. Each Trust shall pay no fee or other compensation to the Company under
this Agreement, and the Company shall pay no fee or other compensation to
either Trust, except that, to the extent a Trust or any Portfolio has adopted
and implemented a plan pursuant to Rule 12b-l under the 1940 Act to finance
distribution and for Shareholder servicing expenses, then such Trust may make
payments to the Company or to the underwriter for the Policies in accordance
with such plan. Each party, however, shall, in accordance with the allocation
of expenses specified in Articles III and V hereof, reimburse other parties
for expenses initially paid by one Party but allocated to another party. In
addition, nothing herein shall prevent the parties hereto from otherwise
agreeing to perform, and arranging for appropriate compensation for, other
services relating to such Trust and/or to the Accounts.
5.2. Each Trust or its designee shall bear the expenses for the cost of
registration and qualification of the Shares under all applicable federal and
state laws, including preparation and filing of such Trust's registration
statement, and payment of filing fees and registration fees; preparation and
filing of such Trust's proxy materials and reports to Shareholders; setting
in type and printing its prospectus and statement of additional information
(to the extent provided by and as determined in accordance with Article III
above); setting in type and printing the proxy materials and reports to
Shareholders (to the extent provided by and as determined in accordance with
Article III above); such preparation of all statements and notices required
of such Trust by any federal or state law with respect to its Shares; all
taxes on the issuance or transfer of the Shares; and the costs of
distributing such Trust's prospectuses and proxy materials to owners of
Policies funded by such shares and any expenses permitted to be paid or
assumed by such Trust pursuant to a plan, if any, under Rule 12b-l under the
1940 Act. Such Trust shall not bear any expenses of marketing the Policies.
5.3. The Company shall bear the expenses of distributing the Shares'
prospectus or prospectuses in connection with new sales of the Policies and
of distributing a Trust's Shareholder reports to Policy owners. The Company
shall bear all expenses associated with the registration, qualification, and
filing of the Policies under applicable federal securities and state
insurance laws; the cost of preparing, printing and distributing the Policy
prospectus and statement of additional information; and the cost of
preparing, printing and distributing annual individual account statements for
Policy owners as required by state insurance laws.
5.4 With respect to the Service Class Shares of a Portfolio, the relevant
Trust may make payments quarterly to MFD under a Portfolio's Rule 12b-l plan,
and MFD may in turn use these payments to pay or reimburse the Company for
expenses incurred or paid (as the case may be) by the Company attributable to
Policies offered by the Company, PROVIDED that no such payment shall be made
with respect to any quarterly period in excess of an amount determined from
time to time by such Trust's Board of Trustees and disclosed in such Trust's
prospectus. MFD shall not be required to provide any payment to the Company
with respect to any quarterly period pursuant to a Trust's Rule 12b-1 plan
unless and until MFD has received the corresponding payment from such Trust
pursuant to the Trust's Rule l2b-1 plan. MFD shall not be required to provide
any payment to the Company with respect to any quarterly period pursuant to
the Trust's Rule 12b-1 plan if (i) such Trust's Rule 12b-1 plan is no longer
in effect during such quarterly period; or (ii) regulatory changes result in
the rescission of Rule l2b-1 or otherwise prohibit the making of such
payments. Each Trust's prospectus or statement of additional information may
provide further details about such payments and the provisions and terms of
such Trust's Rule 12b-l plan, and the Company hereby agrees that neither such
Trust, MFD nor MFS has made any representations to the Company with respect
to such Trust's Rule 12b-l plan in addition to, or conflicting with, the
description set forth in such Trust's prospectus.
5.5. In calculating the payments due under this Agreement, the Company agrees
that it will permit MFD or its representatives to have reasonable access to
its employees and records for the purposes of monitoring of the quality of
the services provided hereunder, verifying the Company's compliance with the
terms of this Agreement and verifying the accuracy of any information
provided by the Company that forms the basis of the fee calculations. In
addition, if requested by MFD, the Company will provide a certification
(which may take the form of a control report or set of agreed upon standards)
satisfactory to MFD that certifies the performance of the services by the
Company and the accuracy of information provided by the Company.
ARTICLE VI. DIVERSIFICATION AND RELATED LIMITATIONS
6.1. Each Trust and MFD represent and warrant that, subject to the Company's
compliance with Section 2.2 of this Agreement, each Portfolio of such Trust
will meet the diversification requirements of Section 817 (h)(1) of the Code
and Treas. Reg. 1.817-5, relating to the diversification requirements for
variable annuity, endowment, or life insurance contracts, as they may be
amended from time to time (and any revenue rulings, revenue procedures,
notices, and other published announcements of the Internal Revenue Service
interpreting these sections), as if those requirements applied directly to
each such Portfolio.
6.2. Each Trust and MFD represent that each Portfolio will elect to be
qualified as a Regulated Investment Company under Subchapter M of the Code
and that they will maintain such qualification (under Subchapter M or any
successor or similar provision).
ARTICLE VII. POTENTIAL MATERIAL CONFLICTS
7.1. Each Trust agrees that the relevant Board, constituted with a majority
of disinterested trustees, will monitor each Portfolio of such Trust for the
existence of any material irreconcilable conflict between the interests of
the variable annuity contract owners and the variable life insurance policy
owners of the Company and/or affiliated companies ("contract owners")
investing in such Trust. The relevant Board shall have the sole authority to
determine if a material irreconcilable conflict exists, and such
determination shall be binding on the Company only if approved in the form of
a resolution by a majority of the relevant Board, or a majority of the
disinterested trustees of the relevant Board. The relevant Board will give
prompt notice of any such determination to the Company.
7.2. The Company agrees that it will be responsible for assisting the Board
in carrying out its responsibilities under the conditions set forth in the
Trusts' exemptive application pursuant to which the SEC has granted the Mixed
and Shared Funding Exemptive Order by providing the Board, as it may
reasonably request, with all information necessary for such Board to consider
any issues raised and agrees that it will be responsible for promptly
reporting any potential or existing conflicts of which it is aware to such
Board including, but not limited to, an obligation by the Company to inform
the Board whenever contract owner voting instructions are disregarded. The
Company also agrees that, if a material irreconcilable conflict arises, it
will at its own cost remedy such conflict up to and including (a) withdrawing
the assets allocable to some or all of the Accounts from the relevant
Trust(s) or any Portfolio and reinvesting such assets in a different
investment medium, including (but not limited to) another Portfolio of a
Trust, or submitting to a vote of all affected contract owners whether to
withdraw assets from a Trust or any Portfolio and reinvesting such assets in
a different investment medium and, as appropriate, segregating the assets
attributable to any appropriate group of contract owners that votes in favor
of such segregation, or offering to any of the affected contract owners the
option of segregating the assets attributable to their contracts or policies,
and (b) establishing a new registered management investment company and
segregating the assets underlying the Policies, unless a majority of Policy
owners materially adversely affected by the conflict have voted to decline
the offer to establish a new registered management investment company.
7.3. A majority of the disinterested trustees of the relevant Board shall
determine whether any proposed action by the Company adequately remedies any
material irreconcilable conflict. In the event that a Board determines that
any proposed action does not adequately remedy any material irreconcilable
conflict, the Company will withdraw from investment in the relevant Trust
each of the Accounts designated by the disinterested trustees and terminate
this Agreement within six (6) months after the relevant Board informs the
Company in writing of the foregoing determination; PROVIDED, HOWEVER, that
such withdrawal and termination shall be limited to the extent required to
remedy any such material irreconcilable conflict as detenuined by a majority
of the disinterested trustees of the Board.
7.4. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or
Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
1940 Act or the rules promulgated thereunder with respect to mixed or shared
funding (as defined in the Mixed and Shared Funding Exemptive Order) on terms
and conditions materially different from those contained in the Mixed and
Shared Funding Exemptive Order, then (a) the Trusts and/or the Participating
Insurance Companies, as appropriate, shall take such steps as may be
necessary to comply with Rule 6e-2 and 6e-3(T), as amended; and Rule 6e-3, as
adopted, to the extent such rules are applicable; and (b) Sections 3.5,
3.6, 7.1, 7.2, 7.3 and 7.4 of this Agreement shall continue in effect only to
the extent that terms and conditions substantially identical to such Sections
are contained in such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY THE COMPANY
The Company agrees to indemnify and hold harmless each Trust, MFD, any
affiliates of MFD, and each of their respective directors/trustees, officers
and each person, if any, who controls the Trust or MFD within the meaning of
Section 15 of the 1933 Act, and any agents or employees of the foregoing
(each an "Indemnified Party," or collectively, the "Indemnified Parties" for
purposes of this Section 8.1) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
the Company) or expenses (including reasonable counsel fees) to which any
indemnified Party may become subject under any statute, regulation, at
common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) or settlements are related to the
sale or acquisition of the Shares or the Policies and:
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the registration statement,
prospectus or statement of additional information for the Policies or
contained in the Policies or sales literature or other promotional material
for the Policies (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, PROVIDED that this agreement to
indemnify shall not apply as to any Indemnified Party if such statement or
omission or such alleged statement or omission was made in reasonable
reliance upon and in conformity with information furnished to the Company or
its designee by or on behalf of the relevant Trust or MFD for use in the
registration statement, prospectus or statement of additional information for
the Policies or in the Policies or sales literature or other promotional
material (or any amendment or supplement) or otherwise for use in connection
with the sale of the Policies or Shares; or
(b) arise out of or as a result of statements or representations (other than
statements or representations contained in the registration statement,
prospectus, statement of additional information or sales literature or other
promotional material of the relevant Trust not supplied by the Company or its
designee, or persons under its control and on which the Company has
reasonably relied) or wrongful conduct of the Company or persons under its
control, with respect to the sale or distribution of the Policies or Shares;
or
(c) arise out of any untrue statement or alleged untrue statement of a
material fact contained in the registration statement, prospectus, statement
of additional information, or sales literature or other promotional
literature of the relevant Trust, or any amendment thereof or supplement
thereto, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement or
statements therein not misleading, if such statement or omission was made in
reliance upon information furnished to the Trust by or on behalf of the
Company; or
(d) arise out of or result from any material breach of any representation
and/or warranty made by the Company in this Agreement or arise out of or
result from any other material breach of this Agreement by the Company; or
(e) arise as a result of any failure by the Company to provide the services
and furnish the materials under the terms of this Agreement;
as limited by and in accordance with the provisions of this Article VIII.
8.2. INDEMNIFICATION BY THE TRUSTS
Each Trust agrees to indemnify and hold harmless the Company and each of its
directors and officers and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act, and any agents or employees
of the foregoing (each an "Indemnified Party," or collectively, the
"Indemnified Parties" for purposes of this Section 8.2) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of such Trust) or expenses (including reasonable
counsel fees) to which any Indemnified Party 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 are
related to the sale or acquisition of the Shares or the Policies and:
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the registration statement,
prospectus, statement of additional information or sales literature or other
promotional material of such Trust (or any amendment or supplement to any of
the foregoing) or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, PROVIDED that this
agreement to indemnify shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission was made in
reasonable reliance upon and in conformity with information furnished to such
Trust, MFD, MFS or their respective designees by or on behalf of the Company
for use in the registration statement, prospectus or statement of additional
information for such Trust or in sales literature or other promotional
material for such Trust (or any amendment or supplement) or otherwise for use
in connection with the sale of the Policies or Shares; or
(b) arise out of or as a result of statements or representations (other than
statements or representations contained in the registration statement,
prospectus, statement of additional information or sales literature or other
promotional material for the Policies not supplied by such Trust, MFD, MFS or
any of their respective designees or persons under their respective control
and on which any such entity has reasonably relied) or wrongful conduct of
such Trust or persons under its control, with respect to the sale or
distribution of the Policies or Shares; or
(c) arise out of any untrue statement or alleged untrue statement of a
material fact contained in the registration statement, prospectus, statement
of additional information, or sales literature or other promotional
literature of the Accounts or relating to the Policies, 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 the Company by or
on behalf of such Trust, MFD or MFS; or
(d) arise out of or result from any material breach of any representation
and/or warranty made by such Trust in this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to comply with the
diversification requirements specified in Article VI of this Agreement) or
arise out of or result from any other material breach of this Agreement by
such Trust; or
(e) arise out of or result from the materially incorrect or untimely
calculation or reporting of the daily net asset value per share or dividend
or capital gain distribution rate; or
(f) arise as a result of any failure by such Trust to provide the services
and furnish the materials under the terms of the Agreement;
as limited by and in accordance with the provisions of this Article VIII.
8.3. In no event shall any Trust be liable under the indemnification
provisions contained in this Agreement to any individual or entity, including
without limitation, the Company, or any Participating Insurance Company or
any Policy holder, with respect to any losses, claims, damages, liabilities
or expenses that arise out of or result from (i) a breach of any
representation, warranty, and/or covenant made by the Company hereunder or by
any Participating Insurance Company under an agreement containing
substantially similar representations, warranties and covenants; (ii) the
failure by the Company or any Participating Insurance Company to maintain its
segregated asset account (which invests in any Portfolio) as a legally and
validly established segregated asset account under applicable state law and
as a duly registered unit investment trust under the provisions of the 1940
Act (unless exempt therefrom); or (iii) the failure by the Company or any
Participating Insurance Company to maintain its variable annuity and/or
variable life insurance contracts (with respect to which any Portfolio serves
as an underlying funding vehicle) as life insurance, endowment or annuity
contracts under applicable provisions of the Code.
8.4. Neither the Company nor any Trust shall be liable under the
indemnification provisions contained in this Agreement with respect to any
losses, claims, damages, liabilities or expenses to which an Indemnified
Party would otherwise be subject by reason of such Indemnified Party's
willful misfeasance, willful misconduct, or 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.
8.5. Promptly after receipt by an Indemnified Party under this Section 8.5.
of notice of commencement of any action, such Indemnified Party will, if a
claim in respect thereof is to be made against the indemnifying party under
this section, notify the indemnifying party of the commencement thereof; but
the omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any Indemnified Party otherwise than under
this section. In case any such action is brought against any Indemnified
Xxxxx, and it notified the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that it may wish, assume the defense thereof, with counsel
satisfactory to such Indemnified Party. After notice from the indemnifying
party of its intention to assume the defense of an action, the Indemnified
Party shall bear the expenses of any additional counsel obtained by it, and
the indemnifying party shall not be liable to such Indemnified Party under
this section for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof other than
reasonable costs of investigation.
8.6. Each of the parties agrees promptly to notify the other parties of the
commencement of any litigation or proceeding against it or any of its
respective officers, directors, trustees, employees or 1933 Act control
persons in connection with the Agreement, the issuance or sale of the
Policies, the operation of the Accounts, or the sale or acquisition of Shares.
8.7. A successor by law of the parties to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article VIII. The
indemnification provisions contained in this Article VIII shall survive any
termination of this Agreement.
ARTICLE IX. APPLICABLE LAW
9.1. This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of The Commonwealth of Massachusetts.
9.2. This Agreement shall be subject to the provisions of the 1933, 1934 and
1940 Acts, and the rules and regulations and rulings thereunder, including
such exemptions from those statutes, rules and regulations as the SEC may
grant and the terms hereof shall be interpreted and construed in accordance
therewith.
ARTICLE X. NOTICE OF FORMAL PROCEEDINGS
Each Trust, MFD, and the Company agree that each such party shall promptly
notify the other parties to thiis Agreement, in writing, of the institution
of any formal proceedings brought against such party or its designees by the
FINRA, the SEC, or any insurance department or any other regulatory body
regarding such party's duties under this Agreement or related to the sale of
the Policies, the operation of the Accounts, or the purchase of the Shares.
ARTICLE XI. CONTROLS AND PROCEDURES
11.1. The Company has implemented controls and procedures that are reasonably
designed to ensure compliance with applicable laws and regulations, as well
as the terms of this Agreement. Without limiting the foregoing, these
controls and are reasonably designed to ensure, and MFD or the Trust may
request certifications on an annual basis with respect to, each of the
following:
(a) Orders for Shares received by the Company for each Portfolio
comply with the Portfolio's restrictions with respect to purchases,
transfers, redemptions and exchanges as set forth in each Portfolio's
prospectus and statement of additional information;
(b) Orders for Shares received by the Company prior to the Portfolio's
pricing time set forth in its prospectus (E.G., the close of the New York
Stock Exchange - normally 4:00 p.m. Eastern time) are segregated from
those received by the Company at or after such time, and are properly
transmitted to the Portfolios (or their agents) for execution at the
current day's net asset value ("NAV"); and orders received by the Company
at or after such time are properly transmitted to the Portfolios (or
their agents) for execution at the next day's NAV;
(c) Market timing and late trading in Shares by Policy holders is identified
and prevented;
(d) Compliance with applicable state securities laws, including without
limitation "bluesky" laws and related rules and regulations;
(e) Compliance with all applicable federal, state and foreign laws, rules and
regulations regarding the detection and prevention of money laundering
activity; and
(f) Effective business continuity and disaster recovery systems with respect
to the services contemplated by the Agreement.
11.2 The Company shall ensure that any other party to whom the Company
assigns or delegates any services hereunder is responsible for, and has
controls and procedures that are reasonably designed to ensure, each of the
items set forth in Section 11.1 above.
ARTICLE XII. TERMINATION
12.1. This Agreement shall terminate with respect to the Accounts, or one,
some, or all Portfolios:
(a) at the option of any party upon six (6) months' advance written notice to
the other parties; or
(b) at the option of the Company to the extent that the Shares of Portfolios
are not reasonably available to meet the requirements of the Policies or
are not "appropriate funding vehicles" for the Policies, as reasonably
determined by the Company. Without limiting the generality of the
foregoing, the Shares of a Portfolio would not be "appropriate funding
vehicles" if, for example, such Shares did not meet the diversification
or other requirements referred to in Article VI hereof; or if the Company
would be permitted to disregard Policy owner voting instructions pursuant
to Rule 6e-2 or Rule 6e-3(T) under the 1940 Act. Prompt notice of the
election to terminate for such cause and an explanation of such cause
shall be furnished to the relevant Trust(s) by the Company; or
(c) at the option of a Trust or MFD upon institution of formal proceedings
against the Company by FINRA, the SEC, or any insurance department or any
other regulatory body regarding the Company's duties under this Agreement
or related to the sale of the Policies, the operation of the Accounts, or
the purchase of the Shares; or
(d) at the option of the Company upon institution of formal proceedings
against a Trust by FINRA, the SEC, or any state securities or insurance
department or any other regulatory body regarding such Trust's or MFD's
duties under this Agreement or related to the sale of the Shares; or
(e) at the option of the Company, a Trust or MFD upon receipt of any
necessary regulatory approvals and/or the vote of the Policy owners
having an interest in the Accounts (or any subaccounts) to substitute the
shares of another investment company for the corresponding Portfolio
Shares in accordance with the terms of the Policies for which those
Portfolio Shares had been selected to serve as the underlying investment
media. The Company will give thirty (30) days' prior written notice to
the relevant Trust(s) of the Date of any proposed vote or other action
taken to replace the Shares; or
(f) termination by either a Trust or MFD by written notice to the Company, if
either one or both of such Trust or MFD respectively, shall determine, in
their sole judgment exercised in good faith, that the Company has
suffered a material adverse change in its business, operations, financial
condition, or prospects since the date of this Agreement or is the
subject of material adverse publicity; or
(g) termination by the Company by written notice to a Trust and MFD, if the
Company shall determine, in its sole judgment exercised in good faith,
that such Trust or MFD has suffered a material adverse change in this
business, operations, financial condition or prospects since the date of
this Agreement or is the subject of material adverse publicity; or
(h) at the option of any party to this Agreement, upon another party's
material breach of any provision of this Agreement; or
(i) upon assignment of this Agreement, unless made with the written consent
of the parties hereto.
12.2. The notice shall specify the Portfolio or Portfolios, Policies and, if
applicable, the Accounts as to which the Agreement is to be terminated.
12.3. It is understood and agreed that the right of any party hereto to
terminate this Agreement pursuant to Section 12.1(a) may be exercised for
cause or for no cause.
12.4. Except as necessary to implement Policy owner initiated transactions,
or as required by state insurance laws or regulations, the Company shall not
redeem the Shares attributable to the Policies (as opposed to the Shares
attributable to the Company's assets held in the Accounts), and the Company
shall not prevent Policy owners from allocating payments to a Portfolio that
was otherwise available under the Policies, until thirty (30) days after the
Company shall have notified the relevant Trust of its intention to do so.
12.5. Notwithstanding any termination of this Agreement, each Trust and MFD
shall, at the option of the Company, continue to make available additional
shares of the Portfolios pursuant to the terms and conditions of this
Agreement, for all Policies in effect on the effective date of termination of
this Agreement (the "Existing Policies"), except as otherwise provided under
Article VII of this Agreement. Specifically, without limitation, the owners
of the Existing Policies shall be permitted to transfer or reallocate
investment under the Policies, redeem investments in any Portfolio and/or
invest in each Trust upon the making of additional purchase payments under
the Existing Policies.
ARTICLE XIII. NOTICES
Any notice shall be sufficiently given when sent by registered or certified
mail, overnight courier or facsimile to the other party at the address of
such party set forth below or at such other address as such party may from
time to time specify in writing to the other party.
If to Trust I:
MFS VARIABLE INSURANCE TRUST
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxx X. Xxxxxx, Assistant Secretary
If to Trust II:
MFS VARIABLE INSURANCE TRUST II
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxx X. Xxxxxx, Assistant Secretary
If to the Company:
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
C/O THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000-0000
Attn: Xxxxx Xxxxxxx
If to MFS:
MFS FUND DISTRIBUTORS, INC.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile No.:
Attn:
ARTICLE XIV. MISCELLANEOUS
14.1. Subject to the requirement of legal process and regulatory authority,
each party hereto shall treat as confidential the names and addresses of
the owners of the Policies and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
this Agreement or as otherwise required by applicable law or regulation,
shall not disclose, disseminate or utilize such names and addresses and
other confidential information without the express written consent of the
affected party until such time as it may come into the public domain.
14.2. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.
14.3. This Agreement may be executed simultaneously in one or more
counterparts, each of which taken together shall constitute one and the same
instrument.
14.4. 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.
14.5. The Schedule attached hereto, as modified from time to time, is
incorporated herein by reference and is part of this Agreement.
14.6. Each party hereto shall cooperate with each other party in connection
with inquiries by appropriate governmental authorities (including without
limitation the SEC, FINRA, and state insurance regulators) relating to this
Agreement or the transactions contemplated hereby.
14.7. The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to
under state and federal laws.
14.8. A copy of each Trust's Declaration of Trust is on file with the
Secretary of State of The Commonwealth of Massachusetts. The Company
acknowledges that the obligations of or arising out of this instrument are
not binding upon any of each Trust's trustees, officers, employees, agents or
shareholders individually, but are binding solely upon the assets and
property of the relevant Trust in accordance with its proportionate interest
hereunder. The Company further acknowledges that the assets and liabilities
of each Portfolio are separate and distinct and that the obligations of or
arising out of this instrument are binding solely upon the assets or
property of the Portfolio on whose behalf the Trust has executed this
instrument. The Company also agrees that the obligations of each Portfolio
hereunder shall be several and not joint, in accordance with its
proportionate interest hereunder, and the Company agrees not to proceed
against any Portfolio for the obligations of another Portfolio.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed hereto as of the date
specified above.
LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
By its authorized officer,
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Xxxxxx X. Xxxxx
Vice President
MFS VARIABLE INSURANCE TRUST,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
Assistant Secretary
MFS VARIABLE INSURANCE TRUST II,
ON BEHALF OF THE PORTFOLIOS
By its authorized officer and not individually,
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
Assistant Secretary
MFS FUND DISTRIBUTORS, INC.
By its authorized officer,
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Xxxxx X. Xxxxxx
President
As of January 1,2011
SCHEDULE A
ACCOUNTS, POLICIES, AND PORTFOLIOS
SUBJECT TO THE PARTICIPATION AGREEMENT
And any other Portfolios or series of shares of the Trusts that are available
and open to new investors on or after the effective date of this Agreement.
NAME OF SEPARATE ACCOUNT AND DATE SHARE CLASS PORTFOLIOS
ESTABLISHED BY BOARD OF DIRECTORS (INITIAL OR SERVICE CLASS) APPLICABLE TO POLICIES
--------------------------------- ------------------------ ----------------------
Lincoln Life & Annuity Variable Annuity Separate Account L Initial (1)
Lincoln Life & Annuity Flexible Premium Variable Life Account M Initial (1)
Lincoln New York Account N for Variable Annuities Initial (1)
LLANY Separate Account R for Flexible Premium Variable Life
Insurance Initial (1)
LLANY Separate Account S for Flexible Premium Variable Life
Insurance Initial (1)
Lincoln Life & Annuity Flexible Premium Variable Life Account Z Initial (1)
LNY Separate Account 401 for Group Annuities Initial (1)
Lincoln Life & Annuity Flexible Premium Variable Life Account JA-B Initial (1)
(1) Portfolios Applicable to Policies:
VIT I
-----
MFS Core Equity Series
MFS Global Equity Series
MFS Growth Series
MFS High Income Series
MFS Investors Growth Stock Series
MFS Investors Trust Series
MFS Mid Cap Growth Series
MFS New Discovery Series
MFS Research Bond Series
MFS Research International Series
MFS Research Series
MFS Strategic Income Series
MFS Total Return Series
MFS Utilities Series
MFS Value Series
VIT II
------
MFS Blended Research Core Equity Portfolio
MFS Blended Research Growth Portfolio
MFS Blended Research Value Portfolio
MFS Emerging Markets Equity Portfolio
MFS Global Growth Portfolio
MFS Global Research Portfolio
MFS Global Total Return Portfolio
MFS International Growth Portfolio
MFS International Value Portfolio
MFS Research International Portfolio
MFS Technology Portfolio
