Common use of Contingent Deferred Sales Charges Clause in Contracts

Contingent Deferred Sales Charges. SUBJECT TO THE ANNUAL WITHDRAWAL AMOUNT, SURRENDERS OF CONTRACT VALUES ATTRIBUTABLE TO PREMIUM PAYMENTS MAY BE SUBJECT TO A CONTINGENT DEFERRED SALES CHARGE ("CHARGE"). THE LENGTH OF TIME FROM RECEIPT OF THE PREMIUM PAYMENT TO THE TIME OF SURRENDER DETERMINES THE CHARGE. DURING THE FIRST SEVEN CONTRACT YEARS, ALL SURRENDERS WILL BE FIRST FROM PREMIUM PAYMENTS AND THEN FROM EARNINGS. IF AN AMOUNT EQUAL TO ALL PREMIUM PAYMENTS HAS BEEN SURRENDERED, A CHARGE WILL NOT BE ASSESSED AGAINST THE SURRENDER OF THE REMAINING CONTRACT VALUE. AFTER THE SEVENTH CONTRACT YEAR, ALL SURRENDERS WILL BE FIRST FROM EARNINGS AND THEN FROM PREMIUM PAYMENTS. A CHARGE WILL NOT BE ASSESSED AGAINST THE SURRENDER OF EARNINGS. IF AN AMOUNT EQUAL TO ALL EARNINGS HAS BEEN SURRENDERED, A CHARGE WILL NOT BE ASSESSED AGAINST PREMIUM PAYMENTS RECEIVED MORE THAN SEVEN YEARS PRIOR TO SURRENDER, BUT WILL BE ASSESSED AGAINST PREMIUM PAYMENTS RECEIVED LESS THAN SEVEN YEARS PRIOR TO SURRENDER. FOR THIS PURPOSE, PREMIUM PAYMENTS WILL BE DEEMED TO BE SURRENDERED IN THE ORDER IN WHICH THEY WERE RECEIVED. THE CHARGE IS A PERCENTAGE OF THE AMOUNT SURRENDERED (NOT TO EXCEED THE AGGREGATE AMOUNT OF THE PREMIUM PAYMENTS MADE) AND EQUALS: LENGTH OF TIME FROM PREMIUM PAYMENT CHARGE (NUMBER OF YEARS) 6% 1 6% 2 5% 3 5% 4 4% 5 3% 6 2% 7 0% 8 AND THEREAFTER NO CONTINGENT DEFERRED SALES CHARGES WILL BE ASSESSED IN THE EVENT THE CONTRACT TERMINATES DUE TO THE DEATH OF THE ANNUITANT OR CONTRACT OWNER (AS APPLICABLE), OR IF CONTRACT VALUES ARE APPLIED TO AN ANNUITY OPTION PROVIDED FOR UNDER THIS CONTRACT (PROVIDED HOWEVER, ANY SURRENDER OUT OF OPTION 4 WILL BE SUBJECT TO CONTINGENT DEFERRED SALES CHARGES, IF APPLICABLE), OR IF THE CONTRACT IS SURRENDERED ON OR AFTER THE ANNUITANT’S 90TH BIRTHDAY, OR UPON THE EXERCISE OF THE ANNUAL WITHDRAWAL AMOUNT. HLVA94-3DIR Page 3 (Continued) Printed in U.S.A. DEFINITION OF Account - Any of the Sub-Accounts or the Fixed Account.

Contingent Deferred Sales Charges. SUBJECT EACH TRUST SHALL CAUSE ITS TRANSFER AGENT (THE "TRANSFER AGENT") TO THE ANNUAL WITHDRAWAL AMOUNTWITHHOLD, SURRENDERS FROM REDEMPTION PROCEEDS PAYABLE TO HOLDERS OF CONTRACT VALUES ATTRIBUTABLE TO PREMIUM PAYMENTS MAY BE SUBJECT TO A CONTINGENT DEFERRED SALES CHARGE ("CHARGE"). THE LENGTH OF TIME FROM RECEIPT OF THE PREMIUM PAYMENT TO THE TIME OF SURRENDER DETERMINES THE CHARGE. DURING THE FIRST SEVEN CONTRACT YEARSCLASS B SHARES, ALL SURRENDERS WILL BE FIRST FROM PREMIUM PAYMENTS AND THEN FROM EARNINGS. IF AN AMOUNT EQUAL TO ALL PREMIUM PAYMENTS HAS BEEN SURRENDERED, A CHARGE WILL NOT BE ASSESSED AGAINST THE SURRENDER OF THE REMAINING CONTRACT VALUE. AFTER THE SEVENTH CONTRACT YEAR, ALL SURRENDERS WILL BE FIRST FROM EARNINGS AND THEN FROM PREMIUM PAYMENTS. A CHARGE WILL NOT BE ASSESSED AGAINST THE SURRENDER OF EARNINGS. IF AN AMOUNT EQUAL TO ALL EARNINGS HAS BEEN SURRENDERED, A CHARGE WILL NOT BE ASSESSED AGAINST PREMIUM PAYMENTS RECEIVED MORE THAN SEVEN YEARS PRIOR TO SURRENDER, BUT WILL BE ASSESSED AGAINST PREMIUM PAYMENTS RECEIVED LESS THAN SEVEN YEARS PRIOR TO SURRENDER. FOR THIS PURPOSE, PREMIUM PAYMENTS WILL BE DEEMED TO BE SURRENDERED IN THE ORDER IN WHICH THEY WERE RECEIVED. THE CHARGE IS A PERCENTAGE OF THE AMOUNT SURRENDERED (NOT TO EXCEED THE AGGREGATE AMOUNT OF THE PREMIUM PAYMENTS MADE) AND EQUALS: LENGTH OF TIME FROM PREMIUM PAYMENT CHARGE (NUMBER OF YEARS) 6% 1 6% 2 5% 3 5% 4 4% 5 3% 6 2% 7 0% 8 AND THEREAFTER NO CONTINGENT DEFERRED SALES CHARGES WILL ("CDSCS") PROPERLY PAYABLE BY SUCH HOLDERS IN ACCORDANCE WITH THE TERMS OF THE PROSPECTUSES RELATING TO SUCH CLASS B SHARES AND SHALL CAUSE THE TRANSFER AGENT TO PAY SUCH AMOUNTS OVER AS PROMPTLY AS POSSIBLE AFTER THE SETTLEMENT DATE FOR EACH REDEMPTION OF SUCH CLASS B SHARES. THE DISTRIBUTOR'S ALLOCABLE PORTION (AS DEFINED IN SCHEDULE 1 TO THIS AGREEMENT) OF SUCH CDSC AMOUNTS SHALL BE ASSESSED IN THE EVENT THE CONTRACT TERMINATES DUE PAYABLE TO THE DEATH DISTRIBUTOR (OR TO PERSONS TO WHOM THE DISTRIBUTOR DIRECTS THE TRUST TO MAKE PAYMENTS). SERVICE FEES. EACH TRUST IS AUTHORIZED TO PAY TO THE DISTRIBUTOR A FEE, CALCULATED DAILY AND PAID MONTHLY IN ARREARS, FOR THE SHAREHOLDER SERVICES THAT ARE DESCRIBED IN PARAGRAPH (B) OF THIS SECTION 5.3 AND THAT ARE PROVIDED BY SUCH DISTRIBUTOR TO ONE OR MORE OF THE ANNUITANT FUNDS. THE AGGREGATE FEE PAID TO THE DISTRIBUTOR FOR SHAREHOLDER SERVICES TO ANY FUND SHALL NOT BE GREATER THAN THE ANNUAL RATE OF ..25% OF THE AVERAGE DAILY NET ASSETS ATTRIBUTABLE TO THE SHARES OF SUCH FUND. IN ADDITION TO THE DISTRIBUTION SERVICES SET FORTH IN SECTION 3 ABOVE, THE DISTRIBUTOR MAY PROVIDE SHAREHOLDER SERVICES TO ACCOUNTS OF THE SHARES OF ONE OR CONTRACT OWNER (MORE OF THE FUNDS, INCLUDING BUT NOT LIMITED TO THE FOLLOWING: TELEPHONE SERVICE TO SHAREHOLDERS, INCLUDING THE ACCEPTANCE OF TELEPHONE INQUIRIES AND TRANSACTION REQUESTS; ACCEPTANCE AND PROCESSING OF WRITTEN CORRESPONDENCE, NEW ACCOUNT APPLICATIONS AND SUBSEQUENT PURCHASES BY CHECK; MAILING OF CONFIRMATIONS, STATEMENTS AND TAX FORMS DIRECTLY TO SHAREHOLDERS; AND ACCEPTANCE OF PAYMENT FOR TRADES BY CHECK, FEDERAL RESERVE WIRE OR AUTOMATED CLEARING HOUSE PAYMENT. IN ADDITION, THE DISTRIBUTOR MAY PERFORM OR SUPERVISE THE PERFORMANCE BY OTHERS OF SHAREHOLDER SERVICES IN CONNECTION WITH THE OPERATIONS OF SUCH FUND(S) WITH RESPECT TO ITS SHARES, AS APPLICABLE)AGREED FROM TIME TO TIME. THE DISTRIBUTION FEE PAYABLE PURSUANT TO THIS AGREEMENT SHALL NOT BE DEEMED TO COMPENSATE THE DISTRIBUTOR FOR ANY SHAREHOLDER SERVICES IT MAY PROVIDE TO ANY TRUST OR FUND PURSUANT TO THE RELEVANT DISTRIBUTION PLAN, WHICH SERVICES MAY INCLUDE PROCESSING OF SHAREHOLDER TRANSACTIONS, RESPONDING TO INQUIRIES FROM SHAREHOLDERS CONCERNING THE STATUS OF THEIR ACCOUNTS AND THE OPERATIONS OF THE TRUST OR ANY FUND, COMMUNICATING WITH THE TRUST AND ITS TRANSFER AGENT ON BEHALF OF SUCH SHAREHOLDERS, OR IF CONTRACT VALUES ARE APPLIED PROVIDING OTHER SHAREHOLDER SERVICES, NOR FOR ANY EXPENSES ASSOCIATED WITH THE PROVISION OF SUCH SHAREHOLDER SERVICES, INCLUDING OFFICE SPACE AND EQUIPMENT, AND TELEPHONE FACILITIES. DIRECTED PAYMENT: ALLOCABLE PORTION CALCULATIONS. THE DISTRIBUTOR MAY DIRECT THE TRUST TO AN ANNUITY OPTION PROVIDED PAY ANY PART OR ALL OF THE DISTRIBUTION FEE OR CDSCS PAYABLE TO THE DISTRIBUTOR IN RESPECT OF ANY CLASS B SHARES OF ANY FUND DIRECTLY TO PERSONS PROVIDING FUNDS TO THE DISTRIBUTOR TO COVER OR OTHERWISE ENABLE THE INCURRING OF EXPENSES ASSOCIATED WITH DISTRIBUTION SERVICES, AND EACH TRUST AGREES TO ACCEPT AND TO COMPLY WITH SUCH DIRECTION. THE DISTRIBUTOR SHALL, AT ITS OWN EXPENSE AND NOT AT THE EXPENSE OF ANY TRUST OR FUND, PROVIDE EACH TRUST WITH ANY NECESSARY CALCULATIONS OF THE DISTRIBUTOR'S ALLOCABLE PORTION OF ANY DISTRIBUTION FEE OR CDSCS, AND EACH TRUST SHALL BE ENTITLED TO RELY CONCLUSIVELY ON SUCH CALCULATIONS, WITHOUT PREJUDICE TO ANY CLAIM IT MAY HAVE CONCERNING THE ACCURACY OF SUCH CALCULATIONS. MAXIMUM CHARGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT OR IN ANY RELEVANT DISTRIBUTION PLAN, THE AMOUNT OF ASSET-BASED SALES CHARGES AND CDSCS PAID TO THE DISTRIBUTOR BY ANY CLASS OF SHARES OF ANY FUND SHALL NOT EXCEED THE AMOUNT PERMITTED BY THE CONDUCT RULES AS IN EFFECT FROM TIME TO TIME. CLASS A, CLASS C, CLASS R-1 AND CLASS R-2 SALES CHARGES. AS COMPENSATION FOR UNDER THIS CONTRACT (PROVIDED HOWEVERITS SERVICES HEREUNDER, ANY SURRENDER OUT OF OPTION 4 WILL THE DISTRIBUTOR SHALL BE SUBJECT ENTITLED TO RECEIVE ALL FRONT-END LOADS AND CONTINGENT DEFERRED SALES CHARGESCHARGES WITH RESPECT TO CLASS A, IF APPLICABLE)CLASS C, OR IF CLASS R-1 AND CLASS R-2 SHARES AS MAY BE DESCRIBED FROM TIME TO TIME IN THE CONTRACT IS SURRENDERED ON OR AFTER REGISTRATION STATEMENT. THE ANNUITANT’S 90TH BIRTHDAY, OR UPON FUND ALSO SHALL PAY A DISTRIBUTION FEE TO THE EXERCISE DISTRIBUTOR AT AN ANNUAL RATE AS SHALL BE AUTHORIZED BY THE SHAREHOLDERS AND FURTHER SET BY THE BOARD OF TRUSTEES PURSUANT TO THE PROVISIONS OF THE ANNUAL WITHDRAWAL AMOUNT. HLVA94-3DIR Page 3 (Continued) Printed in U.S.A. DEFINITION OF Account - Any of the Sub-Accounts or the Fixed AccountCLASS A, CLASS C, CLASS R-1 AND CLASS R-2 DISTRIBUTION PLAN, AS APPLICABLE, EACH AS THEN IN EFFECT, IN ACCORDANCE WITH RULE 12B-1 UNDER THE 1940 ACT.