Exhibit 23(h)(1)
Execution Copy Lincoln VIP Trust
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION
SERVICES AGREEMENT
THIS AGREEMENT is made as of the 1/st/ day of October, 2007 (the "Effective
Date") by and between MELLON BANK, N.A. (referred to herein as "Mellon"), a
national banking association having its principal place of business at 000
Xxxxx Xxxxxx, Xxxxxxxxxx, XX 00000, and LINCOLN VARIABLE INSURANCE PRODUCTS
TRUST (referred to herein as the "Fund"), a Delaware statutory trust having its
principal place of business at 0000 Xxxxxxx Xxxxxx, Xxxx Xxxxx, XX 00000, on
behalf of its Portfolios (as defined below).
WHEREAS, the Fund is registered with the Securities and Exchange Commission
("SEC") as an investment company under the Investment Company Act of 1940 (the
"1940 Act"), and is classified as an open-end management investment company,
unless otherwise noted;
WHEREAS, Mellon is engaged in the fund accounting and financial
administration services business; and
WHEREAS, the Fund desires that Mellon perform the fund accounting, financial
administration and related services described in this Agreement for the Fund,
and Mellon is willing to perform such services on the terms and conditions set
forth in this Agreement.
NOW, THEREFORE, in exchange for good and valuable consideration, the receipt
and sufficiency of which are acknowledged, and intending to be legally bound,
the Fund and Mellon agree as follows:
1. Services
X. Xxxxxx shall perform for the Fund and its series (including all share
classes) listed in Schedule A to this Agreement, the fund accounting, financial
administration and related services set forth in Schedule B to this Agreement
("Services").
The Fund may add a Fund series and/or class to this Agreement by providing
written notice to Mellon at least four (4) months prior to the addition of the
Fund series and/or class; provided that, in the case where the Fund series
and/or class proposes to follow an investment strategy that is materially
different from the investment strategies followed by any other Fund series
and/or class under this Agreement or to make an investment that is not in the
same asset class as investments made by another Fund series and/or class, the
Fund must provide written notice to Mellon at least six (6) months prior to the
addition of the Fund series and/or class and obtain the prior written consent
of Mellon. Such addition must be evidenced by amending Schedule A. The Fund may
delete a Fund series and/or class to this Agreement by providing written notice
to Mellon at least three (3) months prior to the deletion of the Fund series
and/or class. Such deletion must be evidenced by amending Schedule A. Each
existing and future
series of the Fund (including all share classes) covered by this Agreement is
individually and collectively referred to as a "Portfolio."
Mellon may perform other services for the Fund only upon terms, conditions
and compensation that Mellon and the Fund mutually agree to, as evidenced by an
amendment to this Agreement or Schedule X.
X. Xxxxxx may enter into additional agreements with the Fund or its
designated service provider from time to time with respect to: (i) certain
operational functions that Mellon will perform in connection with this
Agreement; and (ii) performance measures pursuant to which Mellon will be
expected to provide the Services (the "Service Level Documents"). The Service
Level Documents will be designed to provide operational guidance and
performance metrics information that may be used by the Fund and Mellon to
assist in the delivery of the Services and to measure Mellon's performance in
providing the Services. The Fund and Mellon agree that the Service Level
Documents will reflect the division of operational functions between or among
the Fund, its agents and Mellon, and specific performance measures for Mellon,
rather than imposing specific contractual obligations under this Agreement.
Notwithstanding the foregoing, (i) Mellon's material and systemic failure to
perform its operational functions or to satisfy the performance measures
pursuant to the Service Level Documents may be considered a material breach of
the "For Cause" provisions described in Section 3.B of this Agreement; (ii) the
Service Level Documents may provide remedies for the failure to satisfy the
operational functions or performance measures contemplated thereunder that are
separate and apart from any right that the Fund or Mellon may exercise under
this Agreement; and (iii) Mellon's performance or non-performance of the
Services, separate and apart from the operational functions and performance
measures reflected in any Service Level Document, may give rise to any remedies
that the Fund may assert against Mellon under the terms of this Agreement.
X. Xxxxxx'x present intention is to utilize the Eagle STAR/PACE platform as
its fund accounting platform, with the understanding of the parties that Mellon
reserves the right to utilize other accounting platform(s) that allow(s) Mellon
to perform the Services at a quality and level equivalent to the quality and
level set forth in the Service Level Documents. Mellon shall be responsible for
the costs and expenses incurred by Mellon and the Fund for converting from the
Eagle STAR/PACE platform to other accounting platform(s) in accordance with
this subparagraph C.
2. Compensation and Expenses
A. In return for performing the Services, the Fund shall compensate Mellon
as set forth in this Section and in Schedule C to this Agreement. Fees due will
be accrued daily. If this Agreement is lawfully terminated before the end of
any month, fees shall be calculated on a pro rated basis through the date of
termination and shall be due upon the Agreement's termination date.
B. The Fund will pay all of its own expenses that are incurred in the Fund's
operation and not specifically assumed by Mellon. Expenses to be borne by the
Fund include, but are not limited to: pricing, security and other similar data
information vendor services; organizational expenses; costs of services of the
Fund's independent registered public accounting
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firm ("Independent Accountant") and the Fund's outside legal and tax counsel
(including such counsel's review of the Fund's registration statement, proxy
materials, federal and state tax qualification as a regulated investment
company and any review of reports and materials prepared by Mellon under this
Agreement); costs of any services contracted for by the Fund directly from
parties other than Mellon; trade association dues; costs of trading operations
and brokerage fees, commissions and transfer taxes in connection with the
purchase and sale of securities for the Fund; investment advisory fees; taxes;
Fund insurance premiums and other Fund insurance-related fees and expenses
applicable to its operation; costs incidental to any meetings of shareholders,
including, but not limited to, legal and auditor fees, proxy filing fees and
the costs of printing and mailing of any proxy materials; costs incidental to
Fund board meetings, including fees and expenses of Fund board members, but
excluding costs specifically assumed by Mellon; the salary and expenses of any
officer, director/trustee or employee of the Fund who is not also a Mellon
employee; registration fees, filing fees, and costs incidental to the
preparation, typesetting, printing and/or distribution, as applicable, of the
Fund's registration statements on Forms X-0X, X-0, X-0, X-0, X-0, and N-14, as
applicable, and any amendments thereto, shareholder reports on Form N-CSR, Form
N-SARs, Form N-Q, Form N-PX, tax returns, and all notices, registrations and
amendments associated with applicable federal and state tax and securities
laws; and other expenses properly payable by the Fund.
C. The Fund agrees to reimburse Mellon for its actual out-of-pocket expenses
in providing the Services, including without limitation, the following:
(i) the electronic transmission expenses incurred by Mellon in
communicating with the Fund, the Fund's investment advisers (which term, for
purposes of this Agreement, shall be interpreted to include any
sub-advisers) or custodian, dealers or others as required for Mellon to
perform the Services, if an Authorized Person requests such electronic
transmission and provides Mellon with prior written approval;
(ii) the costs of creating microfilm, microfiche or electronic copies of
Fund records, and the costs of storage of paper and electronic copies of
Fund records; provided, that Mellon must obtain the prior written approval
of an Authorized Person if such costs for the Fund exceed $7,500 in any
calendar year;
(iii) the charges for services provided by vendors set forth in Schedule
D;
(iv) any additional expenses incurred by Mellon at the written direction
of an Authorized Person;
(v) any additional expenses reasonably incurred by Mellon in the
performance of the Services, provided that, (a) if any individual expense is
less than $1,000, Mellon shall provide prior written notice to the Fund to
the extent practicable, and (b) if any individual expense is $1,000 or more,
Mellon must obtain the prior written approval of an Authorized Person of the
Fund; and
(vi) in the event that Mellon is requested or authorized by the Fund or
is required by law, summons, subpoena, investigation, examination or other
legal or regulatory process to produce documents or personnel with respect
to the Services, and so long as Mellon is
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not the subject of the investigation or proceeding in question, the Fund
will reimburse Mellon for its actual out-of-pocket expenses (including
reasonable attorneys' fees) incurred in responding to these requests. In
addition, when non-routine, extensive or extraordinary productions or
investigations occur, Mellon will notify the Fund (as soon as reasonably
practicable) and the Fund will reimburse Mellon for its personnel's
professional time (at Mellon's standard billing rates or other mutually
agreed upon rates).
X. Xxxxxx shall be entitled to receive the following amounts:
(i) Any systems development and project fees for new or enhanced products
or services requested by the Fund (including significant enhancements
required by regulatory changes), and all systems-related expenses associated
with the provision of special reports and services, in each case as agreed
upon in advance by an Authorized Person; and
(ii) Ad hoc reporting fees billed at an agreed upon rate.
X. Xxxxxx will xxxx the Fund on a monthly basis for the fees and expenses
owed to Mellon by the Fund under this Agreement. The monthly xxxx shall be set
forth on a detailed invoice in a form mutually agreed upon by Mellon and the
Fund. Mellon shall send such invoice to the Fund no later than fifteen
(15) days after the last day of each month; provided, however, that the failure
by Mellon to do so shall not be considered a breach of this Agreement. The Fund
shall pay such invoice within fifteen (15) days of receipt of such invoice by
the Fund. Any undisputed fees or expenses that are not paid by the Fund within
the required time frame shall be subject to a late fee of 1.5% of the amount
billed for each month that such fees or expenses remain unpaid, and the late
fee shall be due and payable upon demand. No Fund shall dispute the minimum
fees set forth in Schedule C. If any fees over and above the minimum fees set
forth in Schedule C or any expenses are disputed by the Fund, Mellon and the
Fund shall work together in good faith to resolve the dispute promptly.
X. Xxxxxx will assume responsibility for the costs of its ordinary and
necessary office facilities (including telephone, telephone transmission, and
telecopy expenses), equipment and personnel to perform the Services, including
the compensation of its employees who serve as Fund trustees, directors or
officers. In the event that Mellon is the subject of an examination, subpoena,
investigation, proceeding or legal or regulatory process relating to the
Services it provides to the Fund ("Mellon Services Inquiry"), and if Mellon
requests that the Fund provide, or if the Fund is required by law, summons,
subpoena, investigation, examination or other legal or regulatory process, to
produce documents or personnel with respect to the Services, then Mellon will
reimburse the Fund for its actual out-of-pocket expenses (including reasonable
attorneys' fees) incurred in responding to these requests. Furthermore, if the
Mellon Services Inquiry is non-routine, extensive or extraordinary, then Mellon
will reimburse the Fund for its personnel's professional time at mutually
agreed upon rates.
3. Length and Termination of Agreement
A. The term of this Agreement shall begin on the Effective Date and continue
for an initial term of seven (7) years (the "Initial Term"). Unless otherwise
terminated in accordance with its terms, Mellon shall either (i) request that
this Agreement be extended for an additional
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three (3) year period, or (ii) indicate that this Agreement will be terminated
upon the expiration of the Initial Term or a Renewal Term (as the case may be),
in either case by sending a written notice of its intent to the Fund no later
than three (3) months prior to the fifth anniversary of the Effective Date of
the Initial Term or the first anniversary of the effective date of a Renewal
Term (as the case may be). If Mellon requests that this Agreement be extended
for an additional three (3) year period and the Fund does not reject such
request in writing to Mellon by the sixth anniversary of the Effective Date of
the Initial Term or the second anniversary of the effective date of a Renewal
Term (as the case may be), this Agreement shall be extended for an additional
three (3) year period (a "Renewal Term"). If either (a) Mellon indicates that
this Agreement will be terminated upon the expiration of the Initial Term or a
Renewal Term (as the case may be) by sending a written notice of its intent to
the Fund no later than three (3) months prior to the fifth anniversary of the
Effective Date of the Initial Term or the first anniversary of the effective
date of a Renewal Term (as the case may be), or (b) the Fund responds to
Mellon's request to extend for an additional three (3) year period by rejecting
such request in writing to Mellon no later than the sixth anniversary of the
Effective Date of the Initial Term or the second anniversary of the effective
date of a Renewal Term (as the case may be), this Agreement shall terminate
upon the expiration of the Initial Term or such Renewal Term (as the case may
be).
B. This Agreement may be terminated by the following party or parties, as
the case may be, for one or more of the following reasons, provided the
terminating party provides the applicable written notice to the other party or
parties, as the case may be, of the reason for such termination:
(i) NonRenewal: Mellon or the Fund may decline to extend the terms of
this Agreement beyond the Initial Term under subparagraph A of this Section;
(ii) Mutual Agreement: Mellon and the Fund may mutually agree in writing
to terminate this Agreement at any time;
(iii) "For Cause": (a) Mellon may terminate this Agreement "For Cause,"
as defined below, by providing the Fund with written notice of termination
"For Cause" at least 60 days prior to the date of termination of this
Agreement, or (b) the Fund may terminate this Agreement with respect to the
Fund "For Cause," as defined below, by providing Mellon with written notice
of termination "For Cause" at least 60 days prior to the date of termination
of this Agreement with respect to the Fund;
(iv) Failure to Pay: Mellon may terminate this Agreement if Mellon has
notified the Fund that it has failed to pay Mellon any undisputed amounts
when due under this Agreement and the Fund has failed to cure such default
within 30 days of receipt of such notice (or, if the Fund has disputed in
good faith any fees over and above the minimum fees set forth in Schedule C
or any expenses, upon final resolution of such dispute); or
(v) Termination of Custody Agreement: Mellon may terminate this Agreement
with respect to the Fund if the Fund terminates its custody agreement with
Mellon or any of its affiliates following either (a) a change in the Fund's
investment adviser (other than a change in the Fund's investment adviser to
another investment adviser that is under common ownership with the Fund's
investment adviser or its successor) or (b) a sale (whether by a merger
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or a sale of the stock or assets) of the Fund's investment adviser (other
than a sale of the Fund's investment adviser to another entity that is under
common ownership with the Fund's investment adviser or its successor) or its
parent company, by providing the Fund with written notice of such
termination at least 60 days prior to the date of termination of this
Agreement with respect to the Fund (which termination date will be extended
by Mellon if, but only if and to the same extent that, the date of
termination of its custody agreement is extended by the Fund). For purposes
of this subparagraph (v) only, the term "investment adviser" does not
include any subadviser.
For purposes of subparagraph (iii) above, "For Cause" shall mean:
(a) a material breach of this Agreement by any other party or parties, as
the case may be, that has not been remedied for 30 days following written
notice by the terminating party that identifies in reasonable detail the
alleged failure of the other party or parties, as the case may be, to
perform, provided that if such default is capable of being cured, then the
other party or parties, as the case may be, are entitled to such longer
period as may reasonably be required to cure such default if the other party
or parties, as the case may be, have commenced such cure and is diligently
pursuing same, but such cure must be completed within 120 days in any event;
(b) when any other party or parties, as the case may be, commit any act
or omission that constitutes gross negligence, willful misconduct, fraud or
reckless disregard of its or their duties under this Agreement and that act
or omission results in material adverse consequences to the terminating
party;
(c) a final, unappealable judicial, regulatory or administrative ruling
or order in which any other party or parties, as the case may be, have been
found guilty of criminal or unethical behavior in the conduct of its
business that directly relates to the subject matter of the Services; or
(d) when any other party or parties, as the case may be, shall make a
general assignment for the benefit of its or their creditors or any
proceeding shall be instituted by or against the other party or parties, as
the case may be, to adjudicate it or them as bankrupt or insolvent, or to
seek to liquidate, wind up, or reorganize the other party or parties, as the
case may be, or protect or relieve its or their debts under any law, or to
seek the entry of an order for relief or the appointment of a receiver,
trustee or other similar official for it or them or for a substantial
portion of its or their assets, which proceeding shall remain unstayed for
sixty (60) days or the other party or parties, as the case may be, have
taken steps to authorize any of the above actions or has become unable to
pay its or their debts as they mature.
C. If this Agreement is terminated by any party (regardless of whether it is
terminated pursuant to paragraph B. above or for any reason other than those
specified in paragraph B. above), the Fund shall pay to Mellon on or before the
effective date of such termination any undisputed and unpaid fees owed to, and
shall reimburse Mellon for any
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undisputed and unpaid out-of-pocket costs and expenses owed to, Mellon under
this Agreement prior to its termination.
D. If either (i) the Fund terminates this Agreement during the Initial Term
for any reason other than those specified in paragraph B. above, or (ii) Mellon
terminates this Agreement during the Initial Term "For Cause" or the Fund's
"failure to pay" under subparagraphs B(iii) or B(iv) of this Section,
respectively, then the Fund shall make a one-time cash payment (a "Termination
Fee") to Mellon on the effective date of such termination in an amount equal to
(w) $4,600,000 if the effective date of the termination of this Agreement is in
the first two years of the Initial Term, (x) $3,500,000 if the effective date
of the termination of this Agreement is in the third year of the Initial Term
(y) $2,300,000 if the effective date of the termination of this Agreement is in
the fourth year of the Initial Term, or (z) $1,200,000 if the effective date of
the termination of this Agreement is in the last three years of the Initial
Term. In addition, the Fund shall reimburse Mellon promptly for any actual,
provable, extraordinary, non-customary and direct costs and expenses (other
than any Costs and Expenses) incurred by Mellon in connection with effecting
such termination and converting the Fund to a successor service provider,
including without limitation the delivery to such successor service provider,
the Fund and/or other Fund's service providers any of the Fund's property,
records, data, instruments and documents.
The parties acknowledge and agree that, upon the occurrence of any of such
events giving rise to a Termination Fee: (i) a determination of actual damages
incurred by Mellon would be extremely difficult, (ii) the Termination Fee is
intended to adequately compensate Mellon for damages incurred and is not
intended to constitute any form of penalty, and (iii) the Termination Fee is
intended to include the Costs and Expenses incurred by Mellon in connection
with effecting such termination and converting the Fund to a successor service
provider, including, without limitation, the delivery to such successor service
provider, the Fund and/or other Fund service providers any of the Fund's
property, records, data, instruments and documents. The parties further
acknowledge and agree that, upon the occurrence of a significant change in the
number of Funds or Portfolios during the Initial Term, they will discuss in
good faith a possible adjustment to the Termination Fee; provided, however,
that no party shall be obligated to agree to any such adjustment.
E. If either (i) Mellon terminates this Agreement with respect to the Fund
at any time for any reason other than those specified in paragraph B. above, or
(ii) the Fund terminates this Agreement with respect to the Fund at any time
"For Cause" under subparagraph B(iii) of this Section, then Mellon shall
reimburse the Fund for any Costs and Expenses incurred by the Fund in
connection with converting the Fund to a successor service provider, including
without limitation the delivery to such successor service provider, the Fund
and/or other Fund's service providers any of the Fund's property, records,
data, instruments and documents.
F. If this Agreement is terminated (i) by Mellon and/or the Fund, as the
case may be, at any time for "nonrenewal" or "upon mutual agreement" under
subparagraphs B(i) and B(ii), respectively, (ii) by Mellon at any time for
"termination of custody" under subparagraph B(v), (iii) by the Fund at any time
after the Initial Term for any reason other than those specified in paragraph B
above, or (iv) by Mellon at any time after the Initial Term "For Cause" or the
Fund's "failure to pay" under subparagraphs B(iii) or B(iv) of this Section,
respectively, the
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Fund shall reimburse Mellon promptly for any Costs and Expenses incurred by
Mellon in connection with effecting such termination and converting the Fund to
a successor service provider, including without limitation the delivery to such
successor service provider, the Fund and/or other Fund's service providers any
of the Fund's property, records, data, instruments and documents.
G. For purposes of this Section 3, "Costs and Expenses" incurred by a party
shall mean any actual, provable, reasonable, customary and direct costs and
expenses incurred by such party. For purposes of this Section 3, Costs and
Expenses shall not include any wind-down costs, including, without limitation,
non-cancelable lease payments; severance payments due and payable to personnel
of Mellon or its Subcontractors that were not engaged by Mellon at the
instruction of the Fund; unused equipment expense; and non-cancelable payments
or termination charges regarding hosting and other subcontracting services that
were not incurred at the instruction of the Fund and that cannot be transferred
or redeployed by Mellon. For purposes of this Agreement, "Subcontractor" shall
include any third party, whether affiliated or unaffiliated with Mellon,
engaged by Mellon in connection with the performance of the Services.
Such party must provide the other party with written evidence of such costs
and expenses before the other party is obligated to pay them. Such party also
has a duty to mitigate, and must exercise its duty to mitigate, such costs and
expenses. Except as expressly set forth in Sections 3 and 9 and Schedule C, no
party hereto shall be responsible for any costs and expenses or damages of any
kind whatsoever resulting from, related to or otherwise in connection with the
termination of this Agreement.
H. In the event that this Agreement is terminated by a party or the parties,
as the case may be, the parties hereto agree to cooperate and act in good faith
to ensure an orderly conversion of the Fund to a successor service provider
with respect to the Services provided under this Agreement. Without limiting
the generality of the foregoing sentence, Mellon agrees that, in the event this
Agreement is terminated by a party or the parties, it will deliver the Fund's
or the Fund's property, records, data, instruments and documents to the Fund,
its successor service providers and/or its other service providers, as the case
may be, in a non-proprietary, commercially-available format.
I. The termination of this Agreement with respect to any Portfolio shall in
no way affect the continued validity of this Agreement with respect to any
other Portfolio. Furthermore, if, following termination of this Agreement with
respect to the Fund or any Portfolio, Mellon continues to perform any one or
more of the Services with the express consent of the Fund or such Portfolio,
then the provisions of this Agreement, including without limitation the
provisions dealing with indemnification and compensation, shall continue in
full force and effect.
4. Amendments, Assignment and Delegation
A modification of this Agreement (which term includes all Schedules) will be
effective only if in writing and signed by the affected parties. No party shall
assign the rights or delegate the duties, or outsource a significant portion of
the Services, pursuant to this Agreement without the prior written consent of
the other party or parties, except as follows:
(i) Mellon may employ such person or persons it may deem desirable to
assist it in performing the Services without notice to the Fund;
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(ii) Mellon shall provide written notice to the Fund before Mellon
engages an unaffiliated third party to provide significant services or
functions to assist Mellon in performing the Services under this Agreement;
(iii) Mellon may delegate one or more of the functions or assign this
Agreement to any direct or indirect majority-owned subsidiary of The Bank of
New York Mellon Corporation or its successor with timely notice to the Fund;
and
(iv) A Fund merger or reorganization that does not result in a change in
the Fund's investment adviser and where the fund surviving from such merger
or reorganization assumes the duties and obligations of the Fund under this
Agreement shall not require Mellon's consent. For purposes of this
subparagraph (iv) only, the term "investment adviser" does not include any
subadviser.
With respect to (i), (ii) and (iii) above, Mellon shall (a) be responsible
for the acts or omissions of such persons, third parties and subsidiaries to
the same extent as Mellon's own acts or omissions under this Agreement, (b) be
responsible for the compensation of such persons, third parties and
subsidiaries, and (c) not be relieved of any of its responsibilities under this
Agreement by virtue of the use of such persons, third parties and subsidiaries.
However, if the Fund instructs Mellon to engage a Subcontractor for the
performance of any of the Services, Mellon will not be responsible for any acts
or omissions by, or compensation payable to, such Subcontractor.
This Agreement shall be binding upon, and shall inure to the benefit of, the
parties and their respective successors and permitted assigns.
5. Documentation
A. The Fund represents that it has provided or made available to Mellon (or
has given Mellon an opportunity to examine) copies of the following documents,
current as of the Effective Date of this Agreement:
(i) The Articles of Incorporation, Agreement and Declaration of Trust,
Partnership Agreement, or other similar charter document, as relevant,
evidencing the Fund's form of organization and any current amendments
thereto;
(ii) The By-Laws or procedural guidelines of the Fund;
(iii) Any resolution or other action of the Fund or the Fund board
establishing or affecting the rights, privileges or other status of any
class of shares of a Portfolio, or altering or abolishing any such class;
(iv) A copy of a resolution of the Fund board appointing Mellon to
provide the Services for each Portfolio and authorizing the execution of
this Agreement and its Schedules;
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(v) A copy of the Fund's currently effective prospectus(es) and
statement(s) of additional information ("Registration Statement") under the
Securities Act of 1933 (the "1933 Act") and 1940 Act;
(vi) Copies of all pertinent Fund policies and procedures that affect the
Services, including, but not limited to, those relating to valuation,
pricing, Section 2(a)(41) of the 1940 Act and Rules 2a-4 and 2a-7
thereunder, net asset value errors, and "as-of" processing (e.g., relating
to error corrections, post-trade revisions or similar processing policies
that may exist);
(vii) Such other documents, certificates or opinions which Mellon
reasonably believes to be necessary or appropriate in the proper performance
of the Services, subject to the agreement of the Fund, which shall not be
unreasonably withheld; and
(viii) Any amendment, revocation or other document altering, adding,
qualifying or repealing any document or authority called for under this
Section.
B. The Fund will provide Mellon with notice and/or a copy of any material
amendment to the items set forth in this Section. Mellon will not be
responsible for changing or conforming the Services to any such amendment until
Mellon has received notice or a copy of such change, and the parties have
negotiated in good faith to reach mutually agreeable terms applicable to such
additional service(s) and have amended any affected Schedules.
6. Representations and Warranties of the Fund
The Fund represents and warrants the following:
A. The Fund is duly organized and validly existing, in good standing under
the laws of the jurisdiction of its organization, and qualified to do business
in each jurisdiction in which the nature or conduct of its business requires
such qualification.
B. The Fund has requisite authority and power under its organizational
documents and applicable law to execute, deliver, consummate and perform this
Agreement; this Agreement is legally valid, binding and enforceable against the
Fund; and the Fund has all necessary registrations and/or licenses necessary to
conduct the activities as described in the Registration Statement.
C. There is no pending or threatened legal proceeding or regulatory action
that would materially impair the Fund's ability to perform its obligations
under this Agreement. The Fund's performance of its obligations under this
Agreement will not conflict with or result in a breach of any terms or
provisions of any agreement to which the Fund is a party or bound, and does not
violate any applicable law.
D. The Fund will use commercially reasonable efforts to ensure that Mellon
has sufficient access to the Fund's service providers, brokers, Independent
Accountant and other authorized agents (each a "Fund Agent"), and related
parties of any of them, in order to obtain the information Mellon will need to
perform the Services; provided that, Mellon shall bear no liability with
respect to the Fund Agent information to which Mellon had no access.
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E. To the best of the Fund's knowledge, all the information relating to the
Fund given to Mellon in connection with the transactions contemplated by this
Agreement is full, complete and accurate, and Mellon may reasonably rely on
such information until it receives written notice from or on behalf of the Fund
of any changes to such information.
F. The Fund has provided Mellon with a current list of all approved
independent pricing, fair value information, and other data information vendors
that are to be used by Mellon in rendering the Services, as set forth in
Schedule D to this Agreement, and the Fund will promptly reflect any changes to
such list in a revised Schedule D.
G. The Fund has appropriate procedures and agreements in place to protect
the confidentiality of any non-public portfolio holdings information of the
Fund that the Fund or its agents direct Mellon to disclose or transmit to third
parties before the Fund publicly discloses such information.
H. The Fund has the requisite amount and scope of fidelity bond coverage
required by Rule 17g-1 under the 1940 Act, and has directors' and officers'
errors and omissions insurance coverage.
7. Representations and Warranties of Mellon
Mellon represents and warrants to the Fund the following:
X. Xxxxxx is duly organized as a national banking association; is in good
standing; and is qualified to do business in each jurisdiction in which the
nature or conduct of its business requires such qualification.
X. Xxxxxx has requisite authority and power under its organizational
documents and applicable law to execute, deliver, consummate and perform this
Agreement; this Agreement is legally valid, binding and enforceable against
Mellon; and Mellon has all necessary registrations and/or licenses necessary to
perform the Services described in Schedule B.
C. There is no pending or threatened legal proceeding or regulatory action
that would materially impair Mellon's ability to provide the Services. Mellon's
performance of the Services will not conflict with or result in a breach of any
of the terms or provisions of any agreement to which Mellon is a party or
bound, and does not violate any applicable law to which Mellon is subject.
X. Xxxxxx has completed, obtained and performed all registrations, filings,
approvals, and authorizations, consents or examinations required by any
government or governmental authority to which Mellon is subject, to perform the
Services contemplated by this Agreement and will maintain the same in effect
for so long as this Agreement remains in effect.
E. To the best of Mellon's knowledge, all the information relating to Mellon
that Mellon or its authorized agents have given to the Fund in connection with
the transactions
Page 11 of 40
contemplated by this Agreement is full, complete and accurate and the Fund may
reasonably rely on such information until it receives written notice from
Mellon of any changes.
X. Xxxxxx will maintain a fidelity bond and an insurance policy with respect
to errors and omissions coverage in form and amount that are commercially
reasonable in light of Mellon's duties and responsibilities under this
Agreement.
X. Xxxxxx has implemented and maintains reasonable procedures and systems
(including reasonable disaster recovery and business continuity plans and
procedures consistent with legal, regulatory and business needs applicable to
Mellon's delivery of the Services) to safeguard the Fund's records and data and
Mellon's records, data, equipment facilities and other property that it uses in
the performance of its obligations hereunder from loss or damage attributable
to fire, theft, or any other cause, and Mellon will make such changes to the
procedures and systems from time to time as are reasonably required for the
secure performance of its obligations hereunder.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, THERE ARE NO EXPRESS OR
IMPLIED REPRESENTATIONS OR WARRANTIES AS TO THE SERVICES UNDER THIS AGREEMENT
OR THE PERFORMANCE THEREOF, INCLUDING WITHOUT LIMITATION, THE MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE OF THE SERVICES (IRRESPECTIVE OF ANY COURSE
OF DEALING, CUSTOM OR USAGE OF TRADE).
8. Standard of Care
Mellon shall act in good faith and exercise reasonable care in performing
the Services under this Agreement. Mellon's duties shall be confined to those
expressly set forth herein, and no implied duties are assumed by or may be
asserted against Mellon hereunder. In that regard, Mellon shall have no
responsibility for the actions or activities of any other party, including
service providers, except as provided in Section 4.
9. Indemnification and Limitation of Liability
A. Except as set forth in subparagraph F. below, Mellon will not be liable
to the Fund for any loss incurred by the Fund as a result of any error of
judgment, mistake of law, act or omission in the course of, or in connection
with the Services rendered by, Mellon under the Agreement in the absence of
fraud, negligence or willful misconduct of Mellon or the reckless disregard of
its duties under the Agreement.
B. Except as set forth in subparagraph F. below, Mellon agrees to indemnify,
defend, and hold harmless the Fund, its trustees, directors, officers,
employees, agents and nominees and their respective successors and permitted
assigns from and against claims, demands, actions, suits, judgments,
liabilities, losses, fines, damages, costs, charges, and counsel fees
(collectively, "Losses") resulting directly and proximately from Mellon's
fraud, negligence or willful misconduct in the performance of the Services, or
reckless disregard of its duties under this Agreement.
Page 12 of 40
C. The Fund agrees to indemnify, defend and hold harmless Mellon, its
trustees, directors, officers, employees, agents, and nominees and their
respective successors and permitted assigns from and against any Losses
resulting directly and proximately from Mellon's actions taken or omissions
with respect to or in connection with the performance of the Services or based,
if applicable, upon Mellon's reasonable reliance on information, records,
instructions or requests reasonably believed to be accurate and genuine
pertaining to the Services that are given or made to Mellon by the Fund, its
investment adviser, or its designated service providers with which Mellon must
interface in providing the Services; provided that this indemnification shall
not apply to actions or omissions of Mellon involving fraud, negligence,
willful misconduct, or reckless disregard in the performance of its duties
under this Agreement.
D. In order for these indemnification provisions to apply, each party
seeking indemnification or to be held harmless shall fully and promptly advise
each indemnifying party in writing of all pertinent facts concerning the
situation in question. Each party seeking indemnification will use reasonable
care to identify and notify each indemnifying party in writing promptly
concerning any situation which presents or appears likely to present the
probability of an indemnification claim. However, failure to do so in good
faith shall not affect the rights under this provision unless the indemnifying
party or parties, as the case may be, is materially prejudiced by such failure.
As to any matter eligible for indemnification, each indemnified party shall act
reasonably and in accordance with good faith business judgment, and shall not
effect any settlement or confess judgment without the consent of each
indemnifying party, which consent shall not be withheld or delayed unreasonably.
E. Each indemnifying party shall be entitled to participate in the defense
at its own expense, or assume the defense, of any suit brought to enforce any
claims subject to this indemnity provision. If the indemnifying party or
parties elect to assume the defense, it shall be conducted by counsel of their
choosing that is reasonably satisfactory to each indemnified party; each
indemnified party shall bear the fees and expenses of any additional counsel it
retains. If the indemnifying party or parties do not elect to assume the
defense of such suit, they will reimburse each indemnified party for the
reasonable fees and expenses of any counsel each indemnified party retains,
which is reasonably satisfactory to such indemnifying party or parties. The
indemnifying party or parties shall not effect any settlement without the
consent of each indemnified party (which shall not be withheld or delayed
unreasonably) unless such settlement imposes no liability, responsibility or
other obligation upon the indemnified party or parties and relieves them of all
fault.
X. Xxxxxx agrees to reimburse the Fund or its shareholders (including former
shareholders) for any losses and reasonable reprocessing costs incurred by the
Fund or its shareholders (including former shareholders) resulting directly and
proximately from Mellon's negligence in calculating the net asset value per
share ("NAV") for the Fund. Mellon's responsibility for reimbursing the Fund or
its shareholders (including former shareholders) will be in accordance with and
subject to the Fund's policies and procedures for addressing NAV errors set
forth in the appropriate Service Level Document, including without limitation a
materiality threshold of one (unrounded) whole cent per share per NAV error (or
such other materiality threshold as agreed upon by the parties in the
appropriate Service Level Document).
Page 13 of 40
Notwithstanding the foregoing, the parties acknowledge and agree that
(i) Mellon will obtain and rely (without independent verification) upon prices
and quotes from authorized pricing, data and fair valuation information vendors
as identified in Schedule D or otherwise authorized under this Agreement, and
(ii) Mellon will be without liability or responsibility for any errors or loss
occasioned by such reliance on such vendors or any errors caused by or
attributable to such vendors, subject to Mellon's material compliance with the
tolerance checks set forth in the appropriate Service Level Document.
G. Each party shall have a duty to mitigate damages for which the other
party or parties may become responsible. NOTWITHSTANDING ANYTHING IN THIS
AGREEMENT TO THE CONTRARY, IN NO EVENT SHALL THE FUND, MELLON, THEIR AFFILIATES
OR ANY OF ITS OR THEIR TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR
SUBCONTRACTORS BE LIABLE FOR EXEMPLARY, PUNITIVE, SPECIAL, INCIDENTAL, INDIRECT
OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION, ATTORNEYS' FEES), LOSS
OF BUSINESS, OR LOST PROFITS, EACH OF WHICH IS HEREBY EXCLUDED BY AGREEMENT OF
THE PARTIES REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE OR WHETHER
EITHER PARTY OR ANY ENTITY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
10. Books and Records, Disclosure, Retention, and Rights of Ownership
X. Xxxxxx shall maintain on behalf of the Fund all books and records which
are customary or which are legally required to be kept in connection with
Mellon's performance of Services, including without limitation those required
by Rules 31a-1 and 31a-2 under the 1940 Act ("Records"). Mellon will prepare
and maintain the Records at the Fund's expense, and the Records shall be the
Fund's property. Mellon will make the Records available for inspection by the
SEC, including giving the SEC access to the Records, and otherwise surrender
the Records promptly in accordance with Rule 31a-3 under the 1940 Act. Mellon
will allow the Fund and its authorized persons and representatives to review
the Records during Mellon's normal business hours or, upon reasonable notice,
at such other reasonable times as the Fund may request.
X. Xxxxxx shall keep the Records confidential, except when: (i) disclosure
is required by law, (ii) Mellon is advised by counsel that it may incur
liability for failure to make a disclosure, (iii) Mellon is requested to
divulge such information by duly-constituted authorities or court process, or
(iv) as requested or authorized by the Fund (including pursuant to its policies
and procedures regarding selective disclosure of non-public portfolio
information). Mellon shall use commercially reasonable efforts to provide
reasonable advance notice to the Fund and its administrator of requests for
disclosure pursuant to items (i) - (iii) of the previous sentence, and to the
extent reasonably practicable to secure instructions as to such inspection, but
shall not be deemed to violate the confidentiality provisions of this Section
or Section 11 if Mellon discloses such Records upon reasonable belief that it
is obliged to do so by applicable law or regulatory authority.
C. Upon and subject to payment of any undisputed and unpaid amounts owed to
Mellon under this Agreement, Mellon may at its option at any time after
termination of this Agreement, and shall promptly upon the Fund's demand or
upon termination of this Agreement,
Page 14 of 40
turn over to the Fund or its designated agent, and cease to retain in Mellon's
files, any Records created and maintained by Mellon pursuant to this Agreement
which are no longer needed by Mellon in the performance of the Services or for
its legal protection. If not so turned over to the Fund, such Records will be
retained by Mellon, at the expense of the Fund (which shall be equal to the
actual costs incurred by Mellon), for at least six (6) calendar years from the
year of creation or for such other period of time as is required under
applicable law. At the end of such period, such Records will be turned over to
the Fund unless the Fund authorizes in writing the destruction of such Records.
D. Notwithstanding the foregoing, all computer programs, systems and
procedures employed or developed by or on behalf of Mellon, or on behalf of
Mellon by system providers or vendors used by Mellon, to perform the Services
that are not Records are the sole and exclusive property of Mellon.
11. Confidential Information; Trade Names, Trademarks and Service Marks
A. "Confidential Information" of a party shall be maintained confidential by
any other party, and shall include: (a) any data or information that is
competitively sensitive material, and not generally known to the public,
including, but not limited to, information about product plans, marketing
strategies, finances, operations, customer relationships, customer profiles,
customer lists, sales estimates, business plans, and internal performance
results relating to the past, present or future business activities of the Fund
or Mellon, their respective subsidiaries and affiliated companies and the
customers, clients and suppliers of any of them; (b) any scientific or
technical information, design, process, procedure, formula, or improvement that
is commercially valuable and secret in the sense that its confidentiality
affords the Fund or Mellon a competitive advantage over its competitors;
(c) all confidential or proprietary concepts, documentation, reports, data,
specifications, computer software, source code, object code, flow charts,
databases, inventions, know-how, and trade secrets, whether or not patentable
or copyrightable; (d) non-public portfolio holdings information of the Fund;
and (e) anything designated as confidential. Mellon shall maintain adequate
safeguards to prevent the use of the Fund's non-public portfolio holdings
information by Mellon, its employees and affiliates for any purpose other than
performing the Services under this Agreement. Mellon also shall maintain
adequate safeguards to limit the dissemination of the Fund's non-public
portfolio holdings information to third parties in accordance with
non-disclosure agreements with the particular Fund, Instructions pursuant to
Section 14, or directions of the Fund under Section 15.C. However, Confidential
Information shall not be subject to such confidentiality obligations if it:
(a) is already known to a receiving party at the time it is obtained; (b) is or
becomes publicly known or available through no wrongful act of a receiving
party; (c) is rightfully received from a third party who, to the best of a
receiving party's knowledge, is not under a duty of confidentiality; (d) is
released by a protected party to a third party without restriction; (e) is
required to be disclosed pursuant to the Fund's Registration Statement or by a
requirement of a court order, subpoena, governmental or regulatory agency or
law (provided the disclosing party will promptly provide the other party
written notice of such requirement, to the extent such notice is permitted);
(f) is relevant to the defense of any claim or cause of action asserted against
a receiving party; or (g) has been or is independently developed or obtained by
a receiving party.
Page 15 of 40
X. Xxxxxx also acknowledges Confidential Information includes nonpublic
personal information about the Fund's customers ("Customer Information") that
the Fund is required by Regulation S-P to keep confidential. Accordingly,
Mellon agrees that, to the extent it receives such Customer Information, it
shall not:
(i) use or disclose Customer Information other than to carry out the
purposes for which the Fund or one of its affiliates disclosed such Customer
Information to Mellon; or
(ii) disclose any Customer Information other than:
(a) to Fund affiliates;
(b) to Mellon affiliates, provided that such affiliates need the
Customer Information to be able to provide the Services hereunder and
shall be restricted in use and disclosure of the Customer Information to
the same extent as Mellon;
(c) to subcontractors of Mellon or the Fund, provided that such
subcontractors need the Customer Information to be able to provide the
Services hereunder and shall have entered into a confidentiality
agreement no less restrictive than the terms hereof; and
(d) to comply with federal, state or local laws, rules and other
applicable legal requirements; to comply with a properly authorized
civil, criminal, or regulatory investigation, or subpoena or summons by
federal, state, or local authorities; or to respond to judicial process
or government regulatory authorities having jurisdiction for
examination, compliance, or other purposes as authorized by law
(provided Mellon will promptly provide the Fund written notice of such
requirement, to the extent such notice is permitted).
For purposes of this paragraph, the term "affiliate" shall have the
meaning set forth in Regulation S-P. To the extent any provisions of
this paragraph conflict with other terms of this Agreement, this
paragraph shall control.
C. Neither party shall use the trade name, trademark or service xxxx of the
other party without the prior written consent of the other party; provided,
however, that (a) either party may use the trade name, trademark or service
xxxx of the other party in connection with providing the Services under the
Agreement, or (b) the Fund may use the trade name, trademark or service xxxx of
Xxxxxx in connection with their Registration Statements.
12. Reports
X. Xxxxxx shall furnish reports to the Fund, its Fund Agents and to others
that the Fund designates in writing at such times as are prescribed pursuant to
this Agreement to be provided or completed by Mellon, or as subsequently agreed
upon by the parties pursuant to this Agreement or any amendment thereto. The
Fund agrees to examine each report promptly and will communicate or cause to be
communicated any errors or discrepancies therein. If there are
Page 16 of 40
errors or discrepancies in a report (except such errors and discrepancies as
may not reasonably be expected to be discovered by the recipient after
conducting a diligent examination) that are not so reported promptly, then a
report will for all purposes be accepted by and binding on the Fund and any
other recipient, absent fraud, negligence, willful misconduct, or reckless
disregard of Mellon's duties under this Agreement, and Mellon shall have no
further responsibility with respect to such report other than to correct and
revise it.
B. For the two month period ending on December 31, 2007, Mellon shall cause
its auditors to perform a Type I SAS 70 audit of Mellon's internal controls and
procedures relating to the Services provided to the Fund that have been
converted onto Mellon's fund accounting platform from November 1, 2007 until
December 31, 2007. For the Fund that has been converted onto Mellon's fund
accounting platform during the period from November 1, 2007 until December 31,
2007, Mellon shall provide the Fund (together with its chief compliance officer
or its designated representative) with a copy of the report resulting from such
Type I SAS 70 audit no later than 45 days after December 31, 2007. For the six
month period ending on June 30 of each year and the twelve month period ending
on December 31 of each year commencing in 2008, Mellon shall cause its auditors
to perform a Type II SAS 70 audit of Mellon's internal controls and procedures
relating to the Services provided to the Fund that have been converted onto
Mellon's fund accounting platform prior to the end of the applicable audit
period. For the Fund that has been converted onto Mellon's fund accounting
platform prior to the end of the applicable audit period, Mellon shall provide
the Fund (together with its chief compliance officer or its designated
representative) with a copy of the report resulting from such Type II SAS 70
audit no later than 45 days after the end of the applicable audit period. All
SAS 70 audit reports shall be treated as Confidential Information.
Page 17 of 40
13. Notices
Any communication, notice or demand pursuant to this Agreement shall be
properly addressed, in writing and delivered by personal service (including
express or courier service), registered or certified mail, or by facsimile with
proof of proper transmission and a means for confirmation of delivery to
recipient, as follows:
If to Mellon:
Mellon Bank, N.A.
000 Xxxxxxxx Xxxxxxx, AIM 026-0026
Xxxxxxx, XX 00000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, First Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Mellon Bank, N.A.
135 Xxxxxxxx Highway, AIM 026-0011
Xxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxxxxx, Esq., First Vice President and Senior
Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
The Bank of New York Mellon Corporation
One Mellon Center
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq., Senior Vice President and Associate
General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Fund:
Lincoln Variable Insurance Products Trust
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Chief Accounting Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Page 18 of 40
With a copy to:
Lincoln Variable Insurance Products Trust
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Secretary
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
14. Authorized Persons and Instructions
A. The Fund shall deliver to Mellon a list of the names, titles and
signatures of all persons who are authorized to act on behalf of the Fund to
issue instructions to Mellon ("Authorized Persons" and "Instructions"),
including any limits on the scope of authority of any Authorized Persons. Fund
trustees, directors and officers shall be presumptively considered Authorized
Persons unless the Fund notifies Mellon to the contrary. The Fund shall
promptly notify Mellon of any changes to or limitations on the rights, powers
and duties of any Authorized Person, but in the absence of receiving such
notice, Mellon shall be entitled to deal with any Authorized Person and to act
and rely upon any Instructions reasonably believed to be from such Authorized
Person.
B. An Instruction means a writing signed or initialed by one or more
Authorized Person. Each such writing shall set forth the specific transaction
or type of transaction involved. Oral instructions will be deemed Instructions
if Mellon reasonably believes them to have been given by an Authorized Person,
and the oral instructions are promptly confirmed in writing.
15. Advice, Reliance and Instructions
X. Xxxxxx may apply to the Fund at any time for Instructions and may consult
with Mellon's or the Fund's counsel, Independent Accountant and other experts
with respect to any matter arising in connection with the Services performed by
Mellon, and Mellon shall not be liable nor accountable for any action taken or
omitted by it in good faith in accordance with such Instructions or on the
advice of such counsel, Independent Accountant or other experts. To the extent
possible, Mellon shall notify the Fund at any time Mellon believes it needs
advice of the Fund's counsel, Independent Accountant or experts with regard to
Mellon's responsibilities and duties pursuant to this Agreement. If Mellon
wishes to seek and rely on legal advice from counsel that is neither the Fund's
counsel nor counsel in the regular employ of Mellon or its affiliated
companies, and Mellon seeks to be reimbursed for such counsel fees, then Mellon
must notify and seek prior approval of such affected Fund, which shall not be
unreasonably withheld. Mellon shall in no event be liable to the Fund or any
Fund shareholder or beneficial owner for any action reasonably taken or omitted
pursuant to such advice.
X. Xxxxxx may rely conclusively upon the terms of a Registration Statement,
the minutes of Fund board meetings and any other Fund document Mellon
reasonably believes to be genuine unless and until Mellon receives Instructions
to the contrary.
Page 19 of 40
C. Subject to the instructions of an Authorized Person, Mellon may provide
information pertaining to the Fund's portfolio holdings to entities designated
by such Authorized Person.
D. The Fund understands and acknowledges that the Services are intended to
assist the Fund and its board in their obligations to price and monitor pricing
of the Fund's portfolio securities, but Mellon does not assume responsibility
for the accuracy or appropriateness of pricing information received from the
Fund or other non-Mellon entities or pricing methodologies, including any fair
value pricing information or adjustment factors. The Fund further understands
and acknowledges that it retains overall responsibility to: (i) adopt policies
and procedures to monitor for circumstances that may necessitate the use of
fair value prices; (ii) establish criteria for determining when market
quotations are no longer reliable for a particular portfolio security;
(iii) determine a methodology or methodologies by which the Fund determines the
current fair value of portfolio securities; (iv) regularly review the
appropriateness and accuracy of the method used in valuing securities and make
any necessary adjustments; and (v) promptly communicate the foregoing in
writing to Mellon pursuant to Section 14.
E. The Fund authorizes Mellon to communicate, as required, with the Fund's
service providers, brokers, futures commission merchants, Independent
Accountant and/or other authorized agents and related parties of any of them to
obtain the information Mellon needs to perform the Services. In that regard,
Mellon agrees to cooperate with the Fund's Independent Accountant, to
reasonably support the Independent Accountant's engagement with the Fund, and
to provide the Independent Accountant reasonable access to the Records. Mellon
also agrees to provide periodic sub-certifications to the Fund's chief
compliance officer and certifying principal executive and financial officers
relating to the Services Mellon performs, based on a form of sub-certification
that Mellon and the Fund reasonably agree to, and subject to such limitations
as may be reasonable or necessary to not make a material misstatement, omission
or untrue statement of fact.
16. Compliance with Law
A. In performing the Services, Mellon shall comply with all applicable laws,
and its standard of performance shall be in accord with such standards as may
be imposed by law and the requirements of all regulatory authorities. However,
unless specifically identified in the Services, nothing expressly or implicitly
contained in this Agreement is intended or shall be interpreted to confer upon
Mellon a duty to ensure that the Fund is acting in compliance with any
applicable laws. Except for the obligations of Mellon set forth in Schedule B,
the Fund assumes full responsibility for the preparation, contents and
distribution of the Fund's Registration Statement and compliance with
applicable laws, including the requirements of the 1933 Act and the 1940 Act,
and governmental authorities having jurisdiction.
X. Xxxxxx shall use its commercially reasonable efforts to make its
employees who are responsible for providing the Services ("Relevant Employees")
available to federal, state and local governmental and regulatory and
supervisory authorities having jurisdiction over the performance of the
Services ("Governmental Authorities") as may be required by such Governmental
Authorities pursuant to applicable law, subpoena or order, and as may be
requested by any Governmental Authorities on behalf of or with respect to the
Fund or any of its
Page 20 of 40
affiliates or as may be requested by the Fund to be made available to such
Governmental Authorities. To the extent legally permitted, Mellon shall
promptly notify the affected Fund of any request by any Governmental
Authorities for any Relevant Employees (except when the request for access to
Relevant Employees was made by the Fund). The affected Fund shall cooperate,
and shall use its commercially reasonable efforts to cause each of its
affiliates and service providers to cooperate, with Mellon in complying with
any notice, order, subpoena or request of any Governmental Authority. Except as
provided in Sections 8 and 9, Mellon shall have no liability to the Fund or any
third party for any claims, obligations, penalties or fines which may arise out
of or in relation to Mellon's compliance with this provision. In accordance
with Section 2.C.(vi), the affected Fund shall reimburse Mellon in connection
with providing such access. Nothing contained in this paragraph shall require
Mellon to disclose any proprietary or confidential information of Mellon or its
other customers and clients.
17. Governing Law and Jurisdiction
This Agreement and performance hereunder and all suits and proceedings
hereunder shall be governed by and construed in accordance with the internal
laws of the Commonwealth of Pennsylvania, without giving effect to conflict of
law principles. Each of the parties to this Agreement expressly and irrevocably
submits to the exclusive jurisdiction of the courts of Pennsylvania and waives
any claims of inconvenient forum or venue. To the extent that the laws of the
Commonwealth of Pennsylvania conflict with the applicable provisions of the
1940 Act, the applicable provisions of the 1940 Act shall control.
18. Services Not Exclusive
X. Xxxxxx'x Services are not exclusive to the Fund and Mellon shall be free
to render similar services to others.
X. Xxxxxx shall perform the Services solely as an independent contractor and
no joint venture, partnership, employment, agency or any other relationship is
intended, accomplished or embodied in this Agreement. Mellon shall have the
sole and exclusive right to supervise, manage, control and direct its
performance of the Services, except that Mellon may be subject to performance
standards and measurements for performing the Services.
C. In performing the Services, Mellon is acting solely on behalf of the Fund
and no contractual or service relationship shall be deemed to be established
between Mellon and any other person, including without limitation the custodian
and Fund shareholders.
19. Force Majeure and Uncontrollable Events
Mellon shall maintain adequate and reliable computer and other equipment
necessary or appropriate to carry out its obligations under this Agreement.
Upon the Fund's reasonable request, Mellon shall provide supplemental
information concerning the aspects of its disaster recovery and business
continuity plan that are relevant to the Services. Notwithstanding the
foregoing or any other provision of this Agreement, Mellon assumes no
responsibility hereunder, and shall not be liable for, any damage, loss of
data, business interruption, delay or any other loss whatsoever caused by
"Force Majeure Events." "Force Majeure Events" are events beyond the
Page 21 of 40
reasonable control of Mellon, its agents and its Subcontractors (other than
Subcontractors engaged by Mellon at the instruction of the Fund). In the event
of Force Majeure Events, or any disaster that causes a business interruption,
Mellon shall act in good faith and follow applicable procedures in its disaster
recovery and business continuity plan and use all commercially reasonable
efforts to minimize service interruptions.
20. Severability
If any provision of this Agreement shall be held or made invalid, the
remainder of this Agreement and the parties' rights and obligations under it
shall not be affected by such action, and the invalid provisions of the
Agreement shall be deemed to be severable only in the jurisdiction that so
determines.
21. Survivability
The following provisions shall survive beyond the expiration and termination
of this Agreement:
. all compensation provisions, including Section 2 Compensation and
Expenses, Section 3 regarding termination fees, costs and expenses, and
Schedule C;
. Section 4. Amendments, Assignment and Delegation;
. Section 6. Representations and Warranties of the Fund;
. Section 7. Representations and Warranties of Mellon;
. Section 9. Indemnification and Limitation of Liability;
. Section 10. Books and Records, Disclosure, Retention, and Rights of
Ownership;
. Section 11. Confidential Information;
. Section 14. Authorized Persons and Instructions;
. Section 19. Force Majeure and Uncontrollable Events; and
. Section 20. Severability.
22. Contract Terms To Be Exclusive
This Agreement constitutes the complete agreement of the parties about the
covered subject matter, and supersedes all prior negotiations, understandings
and agreements bearing upon the covered subject matter. As noted in
Section 1.B., Mellon and the Fund may enter into Service Level Documents or
other interpretive documents in connection with this Agreement. Any such
Service Level Documents or interpretive agreements may be in writing and signed
by all parties, but shall not be deemed to be an amendment to this Agreement,
and because the
Page 22 of 40
intent of such agreements is to generally facilitate operations in a flexible
manner, the breach of any such agreement shall not necessarily constitute a
breach of this Agreement, and the parties shall be free to change the terms of
such agreements as provided therein.
23. Waiver
A party's waiver of a breach of any provision of this Agreement shall not
operate or be construed as a waiver of any subsequent breach by any party. A
party's failure to insist upon strict adherence to any provision of the
Agreement shall not constitute a waiver or deprive such party of the right to
insist upon strict adherence to such provision.
24. Counterparts and Reproduction of Documents
This Agreement may be executed in any number of counterparts, each of which
is deemed an original and all of which together evidence the entire Agreement.
This Agreement and any amendments may be reproduced by any commercially
acceptable process. The parties agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or administrative
proceedings, whether or not the original is in existence and whether or not
such reproduction was made by a party in the regular course of business, and
that any enlargement facsimile or further reproduction of such reproduction
shall be likewise admissible in evidence.
25. Miscellaneous
Paragraph headings in this Agreement are included for convenience only and
are not to be used to construe or interpret this Agreement.
Page 23 of 40
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed all as of the day and year first above written.
LINCOLN VARIABLE INSURANCE MELLON BANK, N.A.
PRODUCTS TRUST, on behalf of its
Portfolios
By: /s/ Xxxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------ ---------------------------------
Name: Xxxxxxx X. Xxxxx, Xx. Name: Xxxxxxxxxxx X. Xxxxx
Title: Second Vice President & Chief Title: First Vice President
Accounting Officer
Date: 9/28/2007 Date: October 1, 2007
Page 24 of 40
SCHEDULE A TO THE
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION SERVICES
AGREEMENT BETWEEN
MELLON BANK, N.A. AND LINCOLN VARIABLE INSURANCE PRODUCTS TRUST,
Dated October 1, 2007
The following Fund and its Portfolios and share classes are covered by, and
made parties to, the Agreement as of the dates so indicated:
LINCOLN VARIABLE INSURANCE PRODUCTS TRUST, a Delaware statutory trust
SEC Registration No. 811-08090 (1940 Act)
033-70742 (1933 Act)
Taxpayer
Date added to Identification
Name of Portfolio and any Share Classes the Agreement CUSIP Number (Portfolio)
--------------------------------------- ------------- ------ ------------------
LVIP Baron Growth Opportunities Fund 10/1/2007 00-0000000
Service Class 534898 408
Standard Class 534898 309
LVIP Capital Growth Fund 10/1/2007 00-0000000
Service Class 534898 846
Standard Class 474903 705
LVIP Xxxxx & Steers Global Real Estate Fund 10/1/2007 00-0000000
Service Class 534898 200
Standard Class 534898 101
LVIP Delaware Bond Fund 10/1/2007 00-0000000
Service Class 53500#118
Standard Class 53404@109
LVIP Delaware Growth and Income Fund 10/1/2007 00-0000000
Service Class 53500#159
Standard Class 53406#105
LVIP Delaware Managed Fund 10/1/2007 00-0000000
Service Class 53500#175
Standard Class 53406@107
LVIP Delaware Social Awareness Fund 10/1/2007 00-0000000
Service Class 53500#209
Standard Class 53407@106
LVIP Delaware Special Opportunities Fund 10/1/2007 00-0000000
Service Class 53500#191
Standard Class 53407*108
Page 25 of 40
Taxpayer
Date added to Identification
Name of Portfolio and any Share Classes the Agreement CUSIP Number (Portfolio)
--------------------------------------- ------------- ---------- ------------------
LVIP FI Equity-Income Fund 10/1/2007 00-0000000
Service Class 53500#134
Standard Class 53405*100
LVIP Janus Capital Appreciation Fund 10/1/2007 00-0000000
Service Class 53500#126
Standard Class 53405#106
LVIP Xxxxxxx International Growth Fund 10/1/2007 00-0000000
Service Class 534898 838
Standard Class 474903 200
LVIP MFS Value Fund 10/1/2007 00-0000000
Service Class 534898 820
Standard Class 474903 408
LVIP Mid-Cap Growth Fund 10/1/2007 00-0000000
Service Class 534898 812
Standard Class 474903 846
LVIP Mid-Cap Value Fund 10/1/2007 00-0000000
Service Class 534898 796
Standard Class 474903 838
LVIP Mondrian International Value Fund 10/1/2007 00-0000000
Service Class 53500#167
Standard Class 53406*109
LVIP Money Market Fund 10/1/2007 00-0000000
Service Class 53500#183
Standard Class 53407#104
LVIP S&P 500 Index Fund 10/1/2007 00-0000000
Service Class 534898 747
Standard Class 474903 853
LVIP Small-Cap Index Fund 10/1/2007 00-0000000
Service Class 534898 788
Standard Class 474903 101
LVIP X. Xxxx Price Growth Stock Fund 10/1/2007 00-0000000
Service Class 534898 770
Standard Class 474903 507
LVIP X. Xxxx Price Structured Mid-Cap Growth Fund 10/1/2007 00-0000000
Service Class 53500#100
Standard Class 53404#107
LVIP Xxxxxxxxx Growth Fund 10/1/2007 00-0000000
Service Class 534898 762
Standard Class 474903 309
LVIP UBS Global Asset Allocation Fund 10/1/2007 00-0000000
Service Class 53500#142
Standard Class 53405@108
Page 26 of 40
Taxpayer
Date added to Identification
Name of Portfolio and any Share Classes the Agreement CUSIP Number (Portfolio)
--------------------------------------- ------------- --------- ------------------
LVIP Value Opportunities Fund 10/1/2007 00-0000000
Service Class 534898754
Standard Class 474903820
LVIP Wilshire Aggressive Profile Fund 10/1/2007 00-0000000
Service Class 53500#340
Standard Class 53500#332
LVIP Wilshire Conservative Profile Fund 10/1/2007 00-0000000
Service Class 53500#308
Standard Class 53500#290
LVIP Wilshire Moderate Profile Fund 10/1/2007 00-0000000
Service Class 53500#282
Standard Class 53500#274
LVIP Wilshire Moderately Aggressive Profile Fund 10/1/2007 00-0000000
Service Class 53500#324
Standard Class 53500#316
LVIP Wilshire 2010 Profile Fund 10/1/2007 00-0000000
Service Class 534898606
Standard Class 534898507
LVIP Wilshire 2020 Profile Fund 10/1/2007 00-0000000
Service Class 534898804
Standard Class 534898705
LVIP Wilshire 2030 Profile Fund 10/1/2007 00-0000000
Service Class 534898879
Standard Class 534898887
LVIP Wilshire 2040 Profile Fund 10/1/2007 00-0000000
Service Class 534898853
Standard Class 534898861
Page 27 of 40
LINCOLN VARIABLE INSURANCE MELLON BANK, N.A.
PRODUCTS TRUST, on behalf of its
Portfolios
By: /s/ Xxxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------ ---------------------------------
Name: Xxxxxxx X. Xxxxx, Xx. Name: Xxxxxxxxxxx X. Xxxxx
Title: Second Vice President & Chief Title: First Vice President
Accounting Officer
Date: 9/28/2007 Date: October 1, 2007
Page 28 of 40
SCHEDULE B TO THE
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION SERVICES AGREEMENT BETWEEN
MELLON BANK, N.A. AND LINCOLN VARIABLE INSURANCE PRODUCTS TRUST,
Dated October 1, 2007
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION SERVICES
Mellon shall perform for the Fund and each of its Portfolios the following fund
accounting, financial administration and related services. Unless otherwise
noted, capitalized terms used herein shall have the same meanings assigned to
them in the Agreement.
A. Valuations
In accordance with the 1940 Act, the Fund's pricing policies and procedures
delivered to Mellon, and the Fund's prospectus and statement of additional
information, and subject to the existence of authorized licensing arrangements
and Instructions, Mellon will perform the following pricing and valuation
services:
1. Perform the necessary functions to calculate daily the net asset value per
share ("NAV") for each share class of each Portfolio of the Fund.
2. Calculate the value of the assets of each Portfolio by obtaining securities
prices and readily available market quotations from independent pricing
sources, subject to any adjustments by the fair valuation information
vendors, in each case using a source/vendor approved by the Fund and listed
in Schedule D. If market quotations for portfolio securities are not readily
available, notify the Fund and obtain prices from authorized broker sources
and/or use fair values as determined in good faith by the Fund's board of
directors/trustees, which includes, but is not limited to, using values
determined by the Fund's pricing policies and procedures and values approved
by the Fund's Valuation/Pricing Committee.
3. Assist in resolving pricing discrepancies and implement mutually agreed upon
price variance thresholds and notification processes.
4. In accordance with the Fund's NAV error correction policies provided to
Mellon, notify the Fund promptly upon discovery of NAV errors of a Portfolio
and initiate correction processes.
B. Calculation and Payment of Expenses
1. Based upon information provided by one of the Fund's Authorized Persons to
Mellon, calculate asset-based fees and submit to the Fund
Treasurer/Principal Financial Officer for approval, and instruct the
custodian to wire fee payments to the service providers.
2. Accrue expense waivers based on Instructions and provide reporting of
accruals of expense waivers.
3. Accrue and allocate fee payments to directors/trustees and other officers of
the Fund paid directly by the Fund according to Instructions and on a
monthly basis forward cash to the Fund's Authorized Persons in the amount
necessary to make such payments to the directors/trustees and other officers
of the Fund.
Page 29 of 40
4. Prepare expense reports, liabilities analysis and budgets for each Portfolio
of the Fund for review and approval by the Fund Treasurer/Principal
Financial Officer, including maintaining detailed records pertaining to
expense accruals and payments, adjusting reports to reflect accrual
adjustments, and monitoring all Fund expenses.
5. Forward any invoices payable by the Fund to the Fund's Authorized Persons
for review and approval. Effective as of October 1, 2008, pay any invoices
approved by the Fund's Authorized Person for payment on behalf of the Fund.
(Prior to October 1, 2008, Delaware Service Company, Inc. or The Lincoln
National Life Insurance Company will pay such invoices.) Allocate such
invoices among the Portfolios in accordance with pre-established
instructions from the Fund's Authorized Persons. Record the payment of
invoices on the Fund's books.
6. Provide to the Fund a monthly summary of disbursements.
C. Financial Reporting
1. Prepare agreed upon financial reporting information for the Fund and/or each
Portfolio: (i) for proxy/information statements, registration statements
(including prospectuses, statements of additional information, and business
combination/exchange offers under Form N-14), Section 19 notices, periodic
shareholder reports (both semi-annual and annual reports), Form N-CSRs, Form
N-Qs, Form N-SARs and such other communications required or otherwise sent
to investors and/or filed with regulatory agencies; (ii) to the Investment
Company Institute; (iii) to statistical reporting and rating agencies; and
(iv) regarding a closed-end Fund's issuance of preferred stock and
commercial paper, if any. Additionally, review and provide comments to the
Fund or a Fund Agent to allow for completion of such reports in accordance
with defined timelines.
2. Prepare other reports, notices or financial documents in accordance with
generally accepted accounting principles, as required by federal, state and
other applicable laws and regulations, in each case as the parties may agree
upon from time to time.
3. Assist in preparing financial information relating to a closed-end Fund's
earnings press release, if any.
4. Provide financial information needed for the offer letter to assist with
buyback and tender offers for a closed-end Fund, if any.
5. Provide 1940 Act Rule 2a-7 amortized cost monitoring (xxxx-to-market)
reports for a money market Portfolio with such frequency as is agreed upon
by parties, or as may be required by Rule 2a-7 and the Fund's policies and
procedures.
6. Prepare and provide such detailed financial reports as may be necessary
for the Fund's board of directors'/trustees' reporting process and as the
parties may agree upon from time to time.
7. Provide sub-certifications in an agreed-upon form to the Fund's chief
compliance officer and certifying principal executive and financial officers
with respect to the generation of financial statements and other financial
reporting performed by Mellon.
D. Portfolio Securities Transactions
Based on information that is provided to Mellon by the Fund, its investment
adviser, and the Fund's Authorized Persons, Mellon will perform the following
functions:
1. Maintain records of investment, capital share, and income and expense
activities for each Portfolio by: (i) recording purchases and sales of
investments; (ii) recording corporate actions and capital changes relating
to investments; (iii) accruing interest, dividends and expenses on
investments; and (iv) maintaining the historical tax lots and income history
for investments.
Page 30 of 40
2. In instances where Mellon is the custodian of the affected portfolio
securities, notify, as directed, the applicable investment adviser (or, if
applicable, sub-adviser) with respect to mandatory and voluntary corporate
actions. The Fund's elections (on actions where elections and options exist)
on voluntary corporate actions must be communicated to Mellon by one of the
Fund's Authorized Persons on the deadline date stated on the corporate
actions notice, allowing a reasonable amount of time before the stated
deadline for Mellon to input the election on the fund accounting system and
notify the custodian (as applicable). Mellon will use commercially
reasonable efforts to respond on behalf of the Fund if a response is
received by Mellon after the deadline date.
3. In instances where Mellon is not the custodian of the affected portfolio
securities, Mellon will notify, as directed, the applicable investment
adviser (or, if applicable, sub-adviser) with respect to mandatory and
voluntary corporate actions upon Mellon's receipt of the corporate action
information. In addition, where Mellon receives mandatory and voluntary
corporate action information in its capacity as portfolio accountant for
other clients on the same accounting platform, Mellon agrees to use
commercially reasonable efforts to identify actions applicable to the Fund's
portfolio securities. However, Mellon assumes no liability for failing to
identify and provide notice of such actions with respect to a portfolio
security when Mellon does not separately receive notice from the custodian
for such portfolio of securities. The Fund's elections (on actions where
elections and options exist) on voluntary corporate actions must be
communicated to Mellon by one of the Fund's Authorized Persons on a date
established by Mellon sufficiently in advance of the deadline date stated on
the custodian's corporate actions notice to permit Mellon to input the
election on the fund accounting system and notify the custodian by its
stated deadline. Mellon will use commercially reasonable efforts to respond
on behalf of the Fund if a response is received by Mellon after a
deadline date.
4. Book corporate action activity upon timely receipt of information and
Instructions from one of the Fund's Authorized Persons.
5. Receive, update and process daily trade files from the Fund investment
adviser's order management system.
6. Based on Instructions from one of the Fund's Authorized Persons or the Fund
Treasurer/Principal Financial Officer, implement tax lot relief methodology.
7. Based on Instructions from an Authorized Person file proof of claim notices
with respect to class actions involving the portfolio securities of the
Portfolios.
E. Dividends & Distributions
Subject to review and approval of the Fund's Treasurer/Principal Financial
Officer, Mellon will perform the following functions:
1. Provide the Fund's transfer agent, dividend disbursing agent and custodian
with such information as is required for such parties to effect the payment
of dividends and distributions and to implement the Fund's dividend
reinvestment plan, if any.
2. Calculate income projections and provide such projections to the Fund for
completion of the Section 19(a) notices and respond to any questions or
issues raised by such projections.
Page 31 of 40
3. Periodically calculate and report each Portfolio's "investment company
taxable income," "net capital gain" distributions, and realized and
unrealized capital gains, and calculate amount of distribution to avoid
application of excise tax, in accordance with IRS Subchapter M requirements
and the Portfolio's distribution policies as disclosed in the Portfolio's
prospectus and established by resolution of the Fund's board of
directors/trustees.
F. Reconciliation and Cash Management
1. Reconcile trade tickets and fund holdings list with investment adviser
records on a daily basis.
2. Reconcile the cash and portfolio investments of the Portfolio with the
records of the Fund's custodian, and provide corresponding reconciliation
reports to the Fund and Fund Agents.
3. Calculate and provide cash projections daily for each Portfolio of the Fund
based on estimates of portfolio security transactions (including projected
income and dividend receipts), shareholder transactions, and Fund
distributions/reinvestments.
4. Calculate and provide daily the cash available for each Portfolio of the
Fund.
5. In coordination with the Fund's investment adviser, allocate trades among
the Portfolios with respect to master repurchase agreement investments and
other short-term investments.
G. Shareholder Activity
1. Record and reconcile daily shareholder activity, including: (i) recording
subscriptions, redemptions, and dividend reinvestments; (ii) reconciling
settlements of shareholder activity; and (iii) recording Portfolio shares
outstanding to the records maintained by each Portfolio's transfer agent and
communicate exceptions to transfer agent which is responsible for
researching exceptions.
2. Provide financial and pricing information to support transfer of portfolio
securities in connection with shareholder transfer-in-kind (purchase and
redemption) transactions.
3. Support the estimation/price protection process and other "post-nightly" and
"as of" shareholder recording processes, including but not limited to,
defined contribution clearance and settlement and same day cash.
H. Fund Performance Information
1. Calculate each Portfolio's performance, including calculations of yield,
total return, expense ratio, portfolio turnover rate and dollar-weighted
average maturity, as applicable, in accordance with standardized SEC
reporting requirements, and provide to the Fund. Calculate and provide such
additional performance information as may be reasonably requested by the
Fund or the Fund's Authorized Persons.
I. Audit Support
1. Provide timely assistance with audit requests from the Fund, its internal
auditors, its Independent Accountants, and regulatory agencies. Respond to
inquiries from other Fund Agents regarding Mellon's processes and interface
with the Fund Agents to support annual SAS 70 audits of the Fund Agents.
Page 32 of 40
2. Prepare work papers for the Fund's annual audit by the Fund's Independent
Accountants, and coordinate the annual audit by the Fund's Independent
Accountants.
3. Provide results of Mellon's semi-annual SAS 70 audits.
J. Tax Reporting
1. Provide the financial information necessary for the Fund's preparation of
its federal, state and city tax returns and ancillary schedules, including
year-end excise tax distributions, and compliance with Subchapter M and
Section 4982 of the Internal Revenue Code of 1986 (the "Code"). Provide
completed Internal Revenue Service forms for the Fund, such as Form
1120-RIC, necessary to file tax returns in accordance with filing deadlines
and maintain copies of all tax returns and related workpapers.
2. Provide financial data regarding portfolio investments to the Fund's
transfer agent to support the production of Form 1099s and similar
shareholder tax reporting.
K. Compliance Monitoring
1. Establish and maintain, and provide summaries of, internal operating
policies and procedures to support the performance of the Services by Mellon.
2. Conduct testing of each Portfolio for compliance with the Code's
requirements to qualify as a regulated investment company, including but not
limited to: (i) quarterly diversification requirements; (ii) annual income
qualification test; and (iii) annual distribution requirements (including
avoiding application of excise taxes). Provide the results to the Fund's
chief compliance officer.
L. Data Feeds
Subject to the existence of authorized licensing arrangements and Instructions,
Mellon will perform the following functions:
1. Disseminate each Portfolio's NAV, dividend and portfolio data to Fund Agents
and Fund-authorized third parties (including, if a closed-end fund, the
stock exchange on which the Fund is listed) and maintain quality controls
necessary to ensure accuracy of the data.
2. Provide holdings information to the Fund's proxy voting agent on a monthly
basis in support of Form N-PX preparation and filing requirements.
3. Provide month-end data feeds at the end of the 1/st/ business day of the new
month and subsequent month-end feeds as data changes in the month-end area.
4. Provide daily data feeds inclusive of that day's trading activity to the
Fund.
5. Provide the necessary data feeds to retirement systems (mainframe).
6. Provide the capability to re-transmit data feeds for past periods.
7. Provide to Bloomberg price/cash file daily.
8. Provide the data necessary for the Fund's internet/intranet applications and
maintain the subject matter expertise and quality controls required to
ensure data accuracy.
9. Provide the release management plan (software development lifecycle
process), release cycle and prior notification of any changes that affect
the data feeds.
Page 33 of 40
M. Business Continuity
1. Provide summaries of Mellon's disaster recovery plan for business
continuity, together with summaries of any disaster recovery testing and
results, with respect to those functions performed by Mellon, except that
Mellon is not responsible for disaster recovery plans for business
continuity with respect to any underlying system upon which Mellon relies
and Mellon neither operates nor controls. Conduct and participate in
pre-defined disaster recovery testing as reasonably requested.
N. Performance of Services by Mellon
1. Monitor Mellon's performance and provide a monthly performance monitoring
report against mutually agreed upon metrics.
2. Develop and implement corrective action plans in the event of service
requirement defaults.
O. Relationship Management
1. Provide client service support to the Fund, including access to day-to-day
points of contact and to points of escalation as necessary.
2. At a minimum, conduct semi-annual meetings with Fund management to discuss
trends, technology and strategic direction.
3. Conduct an annual meeting with Fund management to discuss the Services
provided, system functionality and documentation of policies and procedures.
P. Books and Records
1. Maintain the general ledger and other accounts, books and financial records
of the Fund, as required under Section 31(a) of the 1940 Act and the rules
thereunder in connection with the Services.
2. Comply with SEC and 1940 Act rules and regulations regarding record
retention and maintenance of records on- and off-site as required.
3. Provide the Fund's investment adviser with view and query access to the
accounting systems.
4. Assist with the set-up of new Fund accounts and the maintenance and
termination of existing Fund accounts.
Q. Other
1. Provide financial administration and fund accounting support for projects
and processes as needed and/or required. Examples include establishment of
new registrants, series and/or classes; Fund and/or Portfolio mergers,
liquidations, conversions and proxy statements; insurance policy renewals;
and issues relating to the application of fees and expenses waivers. In the
event that completion of a project or process necessitates Mellon to expend
extraordinary expenses, both parties will negotiate in good faith to
compensate Mellon for all or a portion of these expenses while taking into
consideration other relevant factors such as cost sharing with other Mellon
clients and future revenue projections from such projects or processes.
2. Provide operational and financial reporting support to the Fund and each
Portfolio in connection with its credit facilities.
Page 34 of 40
3. As applicable, support the Fund's transfer agent with respect to dividend
re-purchase processing and communication with omnibus dealers.
[This space intentionally left blank]
Page 35 of 40
LINCOLN VARIABLE INSURANCE MELLON BANK, N.A.
PRODUCTS TRUST, on behalf of its
Portfolios
By: /s/ Xxxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------ ---------------------------------
Name: Xxxxxxx X. Xxxxx, Xx. Name: Xxxxxxxxxxx X. Xxxxx
Title: Second Vice President & Chief Title: First Vice President
Accounting Officer
Date: 9/28/2007 Date: October 1, 2007
Page 36 of 40
SCHEDULE C TO THE
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION SERVICES
AGREEMENT BETWEEN
MELLON BANK, N.A. AND LINCOLN VARIABLE INSURANCE PRODUCTS TRUST
Dated October 1, 2007
Annual Fees
The Fund shall pay to Mellon the following Annual Fees (which are based on the
aggregate average daily net assets of the Fund):
Average Daily Net Assets Annual Fees
------------------------ -----------
First $15 billion of average daily net assets............... .035%
Next $5 billion of average daily net assets................. .0325%
Next $5 billion of average daily net assets................. .030%
Next $5 billion of average daily net assets................. .025%
Over $30 billion of average daily net assets................ .020%
Notwithstanding the foregoing, the annual fees for a Profile Fund or any
Portfolio operated in the same manner as a Profile Fund (e.g., a Fund of Funds)
shall be $47,000.
Any Minimums
The Annual Fees shall be subject to the following minimums:
Year Minimum Annual Fees
---- -------------------
1....................................................... $3,000,000
2....................................................... $2,700,000
3....................................................... $2,300,000
4....................................................... $2,300,000
5....................................................... $2,300,000
For the avoidance of doubt, the annual fees for a Profile Fund or any Portfolio
operated in the same manner as a Profile Fund shall be included in the
calculation to determine whether the Fund has met these minimums.
The parties acknowledge and agree that, upon the occurrence of a significant
change in the number of Funds or Portfolios during the Initial Term, they will
discuss in good faith a possible adjustment to these minimums; provided,
however, that no party shall be obligated to agree to any such adjustment.
Page 37 of 40
LINCOLN VARIABLE INSURANCE MELLON BANK, N.A.
PRODUCTS TRUST, on behalf of its
Portfolios
By: /s/ Xxxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxxxxxx X. Xxxxx
---------------------------------- ---------------------------------
Name: Xxxxxxx X. Xxxxx, Xx. Name: Xxxxxxxxxxx X. Xxxxx
Title: Second Vice President & Chief Title: First Vice President
Accounting Officer
Date: 9/28/2007 Date: October 1, 2007
Page 38 of 40
SCHEDULE D TO THE
FUND ACCOUNTING AND FINANCIAL ADMINISTRATION SERVICES AGREEMENT BETWEEN
MELLON BANK, N.A. AND LINCOLN VARIABLE INSURANCE PRODUCTS TRUST,
Dated October 1, 2007
LIST OF AUTHORIZED PRICING VENDORS:
Name of Vendor Types of Securities
-------------- -------------------
Interactive Data Equities (US and Foreign), Taxable
Bonds, Non Taxable Bonds, CDS
Standard & Poor's (including XX Xxxxx) Non Taxable Bonds, Taxable Bonds
Bloomberg Equities, Bonds, Futures, Options
Reuters Exchange Rates, Equities, Taxable
Bonds
Markit Data (via Interactive Data) CDS and CDX Swap pricing (this is
either direct or via IDC)
FAIR VALUATION INFORMATION VENDOR(S):
Name of Vendor Types of Securities
-------------- -------------------
Interactive Data Fair Value Service Foreign Equities
LIST OF AUTHORIZED DATA INFORMATION VENDORS:
Name of Vendor Type of Service
-------------- ---------------
GICS Security Classifications
Xcitek Corporate Actions Notifications
S&P - CUSIP CUSIP Database
Securities Class Action Services LLC Class Action Notification
LSE - SEDOL License SEDOL Database
Thomson Financial Municipal Floating Rates
LINCOLN VARIABLE INSURANCE MELLON BANK, N.A.
PRODUCTS TRUST, on behalf of its
Portfolios
By: /s/ Xxxxxxx X. Xxxxx, Xx. By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------ ---------------------------------
Name: Xxxxxxx X. Xxxxx, Xx. Name: Xxxxxxxxxxx X. Xxxxx
Title: Second Vice President & Chief Title: First Vice President
Accounting Officer
Date: 9/28/2007 Date: October 1, 2007
Page 40 of 40
