BROKER FIRM CONTRACTING APPOINTMENT PACKET FOR GROUP PROTECTION. Insurance products are issued by insurance affiliates of Lincoln Financial Group.

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1 Partnering With Lincoln Financial Group b BROKER FIRM CONTRACTING APPOINTMENT PACKET FOR GROUP PROTECTION Insurance products are issued by insurance affiliates of Lincoln Financial Group. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates SP /15

2 Welcome to Lincoln Financial Group We are pleased that you have chosen to associate with Lincoln National Life Insurance Company and/or Lincoln Life & Annuity Company of New York and affiliates (hereinafter Lincoln ). The instructions, information and forms on the following pages are designed to make the process of contracting and appointment a smooth and expeditious experience. Lincoln is focused on offering superior service to Broker Firms. To avoid an unnecessary delay in processing, please be certain that all items on the checklist below have been completed and submitted. The Principal will automatically be a party to the agency agreement and available to receive direct compensation when the Broker Firm cannot. Instructions for Completing Required Forms Broker Firm Complete and Provide the Following: 1. Application for Broker Firm Appointment (PS10891). Completed and signed by principal. An explanation for any yes answer(s) must also be signed and dated. 2. Fair Credit Reporting Act Disclosure & Authorization (LA02298). Complete Name and Sign and Date. 3. Agency Agreement Must be completed, Signed and Dated. 4. Business Associate Agreement (GLM10571). Complete Name and Date on page one and Sign and Date page three. 5. AML Training Certification (GLA10700). Proof of AML training required at time of contracting; continuing every 24 months. Must be signed and dated. 6. E&O Coverage. Please attach declaration page naming producer or agency being contracted. E&O declaration page must be current and for a minimum of $1,000, W9 Must be submitted. Optional: 8. FastCash form-electronic Funds Transfer (EFT) Authorization Form (GB02303). Complete and attach a voided check for EFT deposit. Submit completed contracting to (Please select one method of submission.): bplicensing@lfg.com OR mail to: Lincoln Financial Group Attn: GP Licensing PO Box 515 Concord, NH Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Page 1 of 1 PS /14

3 Personal Information Distributor ID# Male Female Principal s Name: SS#: DOB: Physical Home Address: Street City State Zip (All correspondence regarding background information will be sent to home address.) Business Address: Street City State Zip Mailing Address (if different from above): Home Phone: Work Phone: Fax: Address: The Lincoln National Life Insurance Company / Lincoln Life & Annuity Company of New York pays commission to (mark one): Agency Individual Name of agency for corporate appointment: Federal Tax ID#: Application for Broker Firm Appointment The Lincoln National Life Insurance Company Lincoln Life & Annuity Company of New York Attn: GP Licensing, PO Box 515, Concord, NH List state(s) in which you wish to be appointed: Agent License Number(s): Agency License Number(s): Please read and answer each of the following questions: Attach a written explanation, including date of the event and date of discharge, for any YES answers. If anything occurs, which results in a change to any of your answers, you must notify The Lincoln National Life Insurance Company / Lincoln Life & Annuity Company of New York, in writing, within 30 days of the occurrence. Yes No 1. Are you now or have you ever been the subject of any complaint, investigation, or proceeding by any Insurance Department, the SEC or any federal or state regulatory agency? 2. Have you ever been convicted of or pleaded guilty or nolo contendere to a felony or misdemeanor other than a traffic offense? 3. Are you currently, or have you ever been involved in a bankruptcy (personal or any business in which you had control or an ownership interest), pending litigations in which you are a defendant, had a salary garnished or had liens or judgments against you? 4. Are you currently, or have you ever been the subject of any customer complaint or complaint or proceeding by any securities, insurance or commodities regulatory body or organization? 5. Have you ever had your contract, appointment or employment arrangement terminated or have you been permitted to resign from any insurance company or other financial services employer for any reason other than low production? 6. Are you currently, or have you ever been refused a license to sell insurance or been refused membership in any securities regulatory body or organization or had a license suspended or revoked by any securities and/ or State Insurance Department? 7. Are you currently a party or in the past ten years, have you been a party to any lawsuit, arbitration or civil litigation? By signing below, I certify that the foregoing answers are true and correct to the best of my knowledge and belief. I also give The Lincoln National Life Insurance Company / Lincoln Life & Annuity Company of New York permission to investigate as necessary to verify this information and to share the information with parties recruiting and recommending my appointment unless I direct you otherwise. This authorization, in original or copy form, is valid now or any time in the future. Signature of Applicant Date Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Page 1 of 1 PS /14

4 FAIR CREDIT REPORTING ACT DISCLOSURE & AUTHORIZATION DISCLOSURE OF USE OF CONSUMER REPORTS As part of the appointing and/or contracting process, The Lincoln National Life Insurance Company and its affiliates (hereinafter, Lincoln), request consumer reports on prospective producers. From time to time after appointing and/or contracting, Lincoln reserves the right to request consumer reports on its producers in connection with their contracts or new appointments. Occasionally, Lincoln requests investigative consumer reports, which include personal interviews with sources such as your neighbors, friends, associates and/or former employers. Consumer reports and investigatory consumer reports may include information about any or all of the following: your character, general reputation, personal characteristics, mode of living, education, past employment, credit report, professional credentials or your driving and criminal record. If we request an investigative report, we are required by the Fair Credit Reporting Act to notify you within three days after the report is requested, and if you make a written request, we are obligated to disclose to you within five days the nature and scope of the investigation requested. Consumer reports and investigative consumer reports, as well as other information in your file, may be shared among Lincoln Financial Group and its affiliates and parties recruiting and recommending your appointment unless you direct otherwise. CALIFORNIA RESIDENTS Summary of the provisions of section of the California Investigative Consumer Reporting Agency Act a. An investigative consumer reporting agency shall supply files and information required under Section during normal business hours and on reasonable notice. b. Files maintained on a consumer shall be made available for the consumer s visual inspection, as follows: 1. In person, if he appears in person and furnishes proper identification. A copy of his file shall also be available to the consumer for a fee not to exceed the actual costs of duplication services provided. 2. By certified mail, if he makes a written request, with proper identification, for copies to be sent to a specified addressee. Investigative consumer reporting agencies complying with requests for certified mailings under this section shall not be liable for disclosures to third parties caused by mishandling of mail after such mailings leave the investigative consumer reporting agencies. 3. A summary of all information contained in files on a consumer and required to be provided by Section shall be provided by telephone, if the consumer has made a written request, with proper identification for telephone disclosure, and the toll charge, if any, for the telephone call is prepaid by or charged directly to the consumer. c. The term proper identification as used in subdivision (b) shall mean that information generally deemed sufficient to identify a person. Such information includes documents such as a valid driver s license, social security account number, military identification card, and credit cards. Only if the consumer is unable to reasonably identify himself with information described above, may an investigative consumer reporting agency require additional information concerning the consumer s employment and personal or family history in order to verify his identity. d. The investigative consumer reporting agency shall provide trained personnel to explain to the consumer any information furnished to him pursuant to Section e. The investigative consumer reporting agency shall provide a written explanation of any coded information contained in files maintained on a consumer. This written explanation shall be distributed whenever a file is provided to a consumer for visual inspection as required under Section f. The consumer shall be permitted to be accompanied by one other person of his choosing, who shall furnish reasonable identification. An investigative consumer reporting agency may require the consumer to furnish a written statement granting permission to the consumer reporting agency to discuss the consumer s file in such person s presence. AUTHORIZATION I authorize The Lincoln National Life Insurance Company and its affiliates to request and obtain one or more consumer reports and/ or investigative consumer reports about me for appointing and/or contracting purposes, and to share such information within Lincoln Financial Group and its affiliates as well as with parties recruiting and recommending my appointment unless I direct you otherwise. Date: Name (Print): Name (Sign): Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Page 1 of 1 LA /11

5 AGENCY AGREEMENT Group Protection Distribution This AGENCY AGREEMENT ( Agreement ) is by and between The Lincoln National Life Insurance Company, an insurance company organized and existing under the laws of the State of Indiana and Lincoln Life & Annuity Company of New York, an insurance company organized and existing under the laws of the State of New York, and any subsequent affiliate designated from time to time by notice (hereinafter collectively referred to as Lincoln ), and [insert name of Agency Firm] and [insert Name of the Principal) (collectively Agency ). This Agreement is effective as of the day of, 201. WHEREAS, Lincoln is the issuer of insurance products made available to Agency through Lincoln s Group Protection distribution channel (the Policies ); and, WHEREAS, Lincoln proposes to have the Agency sell and/or enroll Policies, directly or through its licensed insurance agents ( Agents ); the Agency agrees to engage in retail activities only. NOW THEREFORE, in consideration of the foregoing and the mutual promises herein contained, the parties hereto agree as follows: 1. Appointment of the Agency. Lincoln hereby appoints the Agency to, directly or through its Agents, and only as applicable: (a) solicit sales of and/or facilitate enrollment in the Policies in all jurisdictions in which the Policies may legally be issued using forms, rates and guidelines provided by the Lincoln; and in which the Agency is properly licensed under state law and appointed under existing Lincoln guidelines; and (b) to service the policyowner/insureds in relation to their Policies. Lincoln in its sole discretion and without prior notice to the Agency, may suspend sales of any Policies or may amend any Policies or contracts evidencing such Policies 2. Company Independence. Each life insurance company s products are separately underwritten and are the sole obligation of the issuing insurer. The life companies are members of Lincoln Financial Group. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its subsidiaries. Lincoln National Corporation is not responsible for financial obligations of these corporations. 3. Independent Contractors. The Agency is an independent contractor with respect to Lincoln, and nothing in this Agreement shall create or be construed to create the relationship of employer and employee between Lincoln and the Agency. The Agency shall, in its sole discretion, select the persons from whom it will solicit applications for Policies, as well as the time, manner and place of solicitation. 4. Limitation of Authority. The Agency s authority shall extend no further than stated in this Agreement. The Agency, directly or indirectly, shall not: (a) make, waive, or change any questions, statements, or answers on any application for the Policies, the terms of any receipt given thereon, or the terms of the Policies; (b) extend the time for payment of premiums or waive any premiums, or forfeiture or guarantee dividends, earnings or rates, or estimate future interest, mortality or expense factors except through the use of authorized illustrations and projections approved by Lincoln; (c) deliver the Policies unless the health of the insured(s) or annuitant(s) is substantially unchanged from the date of the application; (d) incur any debts or liabilities for or against the Lincoln; (e) receive any money for Lincoln; (f) misrepresent, or fail to disclose accurately, the terms or nature of Lincoln s Policies; (g) pay any premiums on the Policies other than the Agency s own; (h) solicit business in a state where the Policies are not approved for sale; (i) share any part of management compensation with producers or Agents recruited by or assigned to the Agency; (j) violate any published Lincoln policy on IOLI/SOLI sales and viatical/life settlements; (k) enter into any proceeding in a court of law or before a regulatory agency in the name of or on behalf of Lincoln. Group Protection Agency Agreement Enrollment Firm v of 9

6 Nothing in this Agreement shall create or be construed to create any exclusive authority to represent Lincoln or to effect sales of Policies with respect to a specific geographic territory or otherwise. 5. Universal Life Policies. The Universal Life polices, which are also one of the class of Policies, ( UL Policies ) issued by Lincoln to which this Agreement applies and as are listed in Schedule A1/B1. Schedule A1/B1 may be amended from time to time by Lincoln. 6. Licensing. The Agency shall at all times when performing functions under this Agreement, be validly licensed in the states and other local jurisdictions that require such licensing or registration in connection with the Agency s sales and/or enrollment activities. Lincoln will, at its option and in its sole discretion, pay state insurance producer appointment fees and any renewals thereof during the term of this Agreement, and the Agency shall be responsible for the payment of all resident and non-resident state insurance license fees and any renewals thereof, as may be necessary to sell or solicit the sale of Lincoln Policies. Agency shall also assist Lincoln in the appointment of its Agents under the applicable insurance laws to sell the Policies. Agency shall fulfill all requirements set forth in the Agent Requirements, attached as Schedule C1 with respect to Lincoln, in conjunction with the submission of licensing/appointment papers for all applicant Agents to become appointed insurance agents with Lincoln. All such licensing/appointment papers should be submitted to Lincoln. Notwithstanding such submission, Lincoln shall have sole discretion to appoint, refuse to appoint, discontinue or terminate the appointment of any Agent as an insurance agent with Lincoln. 7. Compliance. The Agency agrees to comply with all applicable local, state and federal laws and with all rules and regulations of the regulatory agencies having jurisdiction with respect to the sales, enrollment and/or service of the Policies. The Agency agrees to abide by the terms and conditions of this Agreement, the Market Conduct Manual, and any rules relating to Lincoln s business as may be published, or contained on Lincoln s Web site, from time to time. Agency is responsible for ensuring its employees, contractors and Agents ( Representatives ) act in compliance with the terms of this Agreement and all applicable federal and state laws and regulations, including but not limited to those relating to the negotiation, solicitation and sale of Policies. Agency agrees that non- licensed Representatives may only be used to assist Agents and Agency in Policy enrollment if such services are allowed within the exceptions of the Producer Model Licensing Act or other such applicable legal or regulatory requirements; and that such non-licensed Representatives do not receive commissions or sign Policy applications as the insurance Agent. 8. Anti-Money Laundering. Each party to this Agreement represents to the other that, as applicable, it has established and implemented an anti-money laundering compliance program in accordance with applicable laws and regulations, including applicable FINRA Conduct Rules, rules and regulations promulgated under the Securities Exchange Act of 1934, and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, as amended (the USA Patriot Act ), specifically including, but not limited to, Section 352 of the International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001 ( the Money Laundering Abatement Act). The aforementioned laws, rules and regulations are herein collectively referred to as the AML Rules. Each party represents that, as applicable, it has an anti-money laundering compliance program that is reasonably expected to detect and cause the reporting of suspicious activities in connection with the offering and sale of the applicable Policies. Each party further represents that it is currently in compliance with all applicable AML Rules, specifically including, but not limited to, the Customer Identification Program requirements under Section 326 of the Money Laundering Abatement Act and regulations administered by the United States Department of Treasury s Office of Foreign Asset Control, and agrees to remain in compliance with those applicable AML Rules and to take all actions necessary to comply with any new or additional applicable AML rules promulgated by applicable laws, regulations or executive orders. 9. The Violent Crime Control and Law Enforcement Act. The Agency represents and warrants that neither Agency, nor any Representative of the Agency providing services according to the terms of this Agreement has been convicted of any felony involving dishonesty or breach of trust under any state or federal law. The Agency agrees to defend and indemnify Lincoln with respect to any action brought against Lincoln to the extent that such action is based upon a claim that the engagement by Lincoln of the Agency or any such Representative of the Agency violated any state or federal proscription against such engagement, including but not limited to The Violent Crime Control and Law Enforcement Act of 1994, as may be amended. Group Protection Agency Agreement Enrollment Firm v of 9

7 10. Confidential Information and Protection of Non-Public Personal Information. The Agency and Lincoln agree to maintain the other party s Confidential Information (defined below) in strict confidence and in a manner to safeguard against unauthorized access, disclosure, use, destruction, loss or alteration in accordance with the Gramm-Leach-Bliley Act, Regulation S-P, the relevant state and federal regulations pursuant thereto and state privacy laws (all the foregoing referred to as Privacy Law. ) (a) Confidential Information shall mean (1) any data or information that is proprietary to the disclosing party and not generally known to the public, whether in tangible or intangible form, including, but not limited to, any information relating to a party s marketing strategies, business systems, databases, and (2) any customer or consumer specific data deemed to be non-public personal information under the Privacy Law. (b) Specifically, with regard to non-public personal information, the Agency and Lincoln agree that they are prohibited from using consumer or customer non-public personal information other than (1) to execute the terms and conditions of this Agreement as permitted by Privacy Law or (2) as required by state or federal law, regulation or rule. The Agency and Lincoln agree not to disclose consumer or customer non-public personal information to any third parties without prior written permission of the disclosing party. The Agency and Lincoln shall promptly report to the other party any unauthorized disclosure or use of any Confidential Information of which it becomes aware. (c) Upon request, the Agency and Lincoln shall return to the other party or destroy (and provide an appropriate written destruction certificate) all Confidential Information in its possession or control. No disclosure by the Agency or Lincoln hereto of Confidential Information of such party to the other party shall constitute a grant to the other of any interest or right whatsoever in such Confidential Information, which shall remain the sole property of the disclosing party. (d) Lincoln has the right to make reasonable requests to inspect, during normal business hours, Agency s facilities, data and records, associated audit reports, summaries of test results or equivalent measures taken by a party to ensure compliance with the Privacy Law for the purposes of verifying that the confidentiality provisions of this Agreement are being complied with. The terms of this section will survive the termination of this Agreement. (e) The Agency and Lincoln also acknowledge that they are parties to a Lincoln Business Associate Agreement (LBAA) and that the LBAA is incorporated by reference. In the event there is a conflict between the terms of this Agreement the LBAA as it relates to Confidential Information, the LBAA will control. 11. Investigations; Customer Complaints. Agency agrees to cooperate fully in any insurance or other regulatory or judicial investigation or proceeding arising in connection with the Policies, Lincoln, or Agency. Agency shall permit appropriate federal and state insurance and other regulatory authorities to audit Agency s records and shall furnish the foregoing authorities with any information which such authorities may request in order to ascertain whether Agency is complying with all applicable laws and/or regulations. Agency shall promptly notify Lincoln of any customer complaints with respect to the Policies or Lincoln and to cooperate with Lincoln in resolving all customer complaints with respect to the Policies, Lincoln or Agency. 12. Books and Records. Agency shall maintain thorough and correct books, accounts and records of all transactions covered by this Agreement as required by applicable laws and regulations. Agency shall preserve and hold all documents, correspondence and records that come into the Agency s possession or control relating to the Policies as long as the Policies remain in force. The books, accounts and records of Agency shall clearly and accurately disclose the nature of details of Agency s activities related hereto. Agency shall take appropriate action to keep confidential all information obtained pursuant to this Agreement (including, without limitation, names of purchasers of Policies) as set forth under Section 10. Lincoln shall have access to all books, accounts and records of Agency and its Representatives. This provision shall survive termination of this Agreement. 13. Sales Practices. The Agency shall be responsible for offering the Policies for sale in accordance with all Lincoln rules and procedures then in effect. All applications for Policies shall be made on application forms supplied by Lincoln and all payments collected by the Agency shall be remitted promptly in full, without deduction or setoff, together with such application forms and any other required documentation, including temporary insurance agreements, directly to Lincoln at the address indicated on such application or to such other address as Lincoln may, from time to time, designate in writing. The Agency shall review all such applications for completeness and suitability. Checks in payment on any Policy shall be drawn to the order of The Lincoln National Life Insurance Company, or Lincoln Life & Annuity Company of New York, as applicable. All applications are subject to acceptance or rejection by Lincoln at its sole discretion. All records of information obtained hereunder by the Agency shall not be disclosed or used except as expressly authorized herein, and the Agency will Group Protection Agency Agreement Enrollment Firm v of 9

8 keep such records and information confidential, to be disclosed only as authorized or if expressly required by federal or state regulatory authorities. 14. Sales Promotion Materials and Advertising. Sales Promotion Material is defined as material designed to create public interest in the Policies, or to induce the public to purchase, increase, modify, reinstate or retain a Policy, including: (a) printed and published material, audiovisual material, descriptive literature used in direct mail, newspapers, magazines, radio and television scripts, billboards, electronic and similar displays; (b) descriptive literature and sales aids of all kinds, including circulars, leaflets, booklets, depictions, illustrations and form letters, whether in the form of computer software, digital, electronic or printed materials; (c) material used for training and education which is designed to be used or is used to induce the public to purchase, increase, modify, reinstate, or retain a Policy. The Agency shall be provided with illustrations relating to applicable Policies and such other material as Lincoln determines to be necessary or desirable for use in connection with sales of the Policies. No Sales Promotion Materials or any advertising relating to the Policies shall be used by the Agency unless the specific item has been approved in writing by Lincoln. While Lincoln stationary may be made available to the Agency, it is to be used only when promoting Lincolns products exclusively. In addition, the Agency shall not print, publish or distribute any Sales Promotional Materials, advertisement, circular or any document relating to Lincoln unless such Sales Promotional Materials, advertisement, circular or document shall have been approved in writing by Lincoln. 15. Lincoln Property. The Agency agrees that all policyholder files, lists of policyowners or insured persons, records and premium accounts are the property of Lincoln, and may be audited or inspected as Lincoln may require. All computer software containing the rates and values of products issued by Lincoln, all Lincoln rate books, computer printouts, forms, policies, brochures, sales promotion materials, whether in hard copy or computer format, containing the name/logo of Lincoln or any affiliated company remains the property of Lincoln and are furnished to the Agency in confidence, and the Agency agrees to refrain from reproducing, publishing or disclosing such material other than in the ordinary course of business or with the written consent of Lincoln. The Agency further agrees that all such property shall be returned to Lincoln upon demand or upon termination of this Agreement. Upon termination of this Agreement for any reason, the Agency further agrees not to use any such material for his commercial purposes or for that of any other entity. 16. E & O Coverage. The Agency shall maintain E&O coverage in a minimum amount of $1,000, per incident of coverage for its and its Representatives acts and omissions relating to applicable solicitation, enrollment or service of Products and this Agreement. Agency shall provide Lincoln a Certificate of Insurance evidencing these coverages at time of appointment. All of Agency s insurance carriers must have an A.M. Best rating of A or higher, financial size category VII or higher. Agency shall provide Lincoln not less than thirty (30) days prior written notice of any change to or cancellation of Agency s E&O coverage. Lincoln will not reimburse Agency for any cost of obtaining or carrying insurance. 17. Territory. This Agreement does not confer any exclusive right or territory upon the Agency and Lincoln reserves the right: (a) to appoint additional individuals, brokers, agencies, firms or organizations in such locale who also shall have the right to recommend appointment of others by Lincoln; and (b) to establish and maintain other or additional sales or enrollment offices in the same locale. 18. Compensation. (a) Commissions. The Agency shall be compensated in accordance with the terms of this Agreement; and the Schedule of Commissions set forth in Schedule A1/B, applicable Single Case Compensation Agreement and/or such separate written agreements signed by both parties. Commissions shall accrue only after issuance and delivery of the contract, after the due date of the premium and after the premium is received by Lincoln. Commissions on premiums paid in advance shall accrue only on the regular premium due dates of such premiums. No commissions shall be payable on account of waived premiums or on interest or loan payments collected. Compensation on extra premiums, conversions, exchanges, replacements and other special situations not provided herein will be governed by Lincoln s rules and practices in effect at that time. The rate of and the right to receive compensation on any Policy not listed in Schedule A1/B1 or requiring special underwriting shall be determined by the published schedule of commissions for that product or rules of the Lincoln in effect at that time, by a Single Case Compensation Agreement or by a separate written agreement with the Agency signed by a duly authorized representative of Lincoln. No applications will be accepted nor Group Protection Agency Agreement Enrollment Firm v of 9

9 will any compensation be paid on Policies which are not approved in the state where written. In order to receive any compensation, the Agency must be licensed and appointed with Lincoln in the Policy s state of issue at the time of policy issue. If there is a conflict between this Agreement and a Schedule of Commission, Single Case Compensation Agreement or other separate written agreement for compensation signed by both parties, then the terms of this Agreement shall control. (b) Lincoln Refund of Premiums. Lincoln, in its sole and absolute discretion, may reject any applications or payments remitted through the Agency and may refund an applicant s payments to the applicant. Lincoln may in its discretion settle any claim of policy owners or others in connection with any consumer complaint or any threatened or pending lawsuit as a result of any claimed improper or unauthorized action or statement in marketing the Policy. In the event a refund of premium is made for any reason and if the Agency has received compensation, including renewal commissions, the Agency shall promptly repay such compensation to Lincoln. If repayment is not promptly made, Lincoln may at its sole option deduct any amounts due Lincoln from the Agency from future compensation or commissions otherwise payable to the Agency. Any compensation chargebacks shall be made in accordance with then Lincoln policy. This provision shall survive termination of this Agreement. (c) Changes to Commission Schedule. Lincoln may change the schedule of sales commissions at any time. Any such change shall apply to compensation due on applications received by Lincoln after the effective date of such change, unless such change is required to be in compliance with the law. (d) Restrictions. (i) The Agency agrees that Agency shall not, whether or not permitted by law: (1) rebate or offer to rebate all or any part of a premium on a Policy, directly or indirectly; (2) withhold any premium on a Policy; (3) rebate or offer to rebate all or any part of a commission paid or payable upon the sale of a Policy; or (4) promote fee splitting or commission sharing arrangements. Violation of such Lincoln rules, laws or regulations shall be grounds for termination of this Agreement by Lincoln. (ii) If the Agency shall at any time induce or endeavor to induce any owner of a Policy to relinquish the Policy except under circumstances where there are reasonable grounds for believing that the Policy, contract or certificate is not suitable for such person, any and all compensation due the Agency so acting shall cease and terminate. (iii) Nothing in this Agreement shall be construed as giving the Agency the right to incur any indebtedness on behalf of Lincoln. Lincoln is hereby authorized to set off liabilities of the Agency against any and all amounts otherwise payable to the Agency by Lincoln. (iv) Lincoln shall not be obligated to recognize any assignment of commissions by the Agency until the original assignment or a certified copy thereof is delivered at its home office, nor does Lincoln assume any responsibility for or guarantee the validity or sufficiency of any assignment. 19. Termination. (a) This Agreement may be terminated by any party, without cause, upon thirty (30) days written notice to the other parties via regular U.S. mail addressed to the last known address of the other party. This is an at-will contract; this is not a contract for a definite term or period of time. (b) This Agreement automatically terminates upon: (i) the death or total and permanent physical or mental disability of such party, if an individual; (ii) the dissolution of the party, if a corporation or a partnership, including LLC and LLP; (iii) the Agency s failure to meet the minimum production requirements of Lincoln for continuation of this Agreement. These requirements may change from time to time. The minimum requirements shall be announced annually and any changes shall be announced prior to the effective date of the change; (iv) failing to maintain in force specified amounts of a professional errors and omissions liability policy. (c) Termination for cause results in forfeiture of any further payments and any accrued rights to participate in plans, programs, or benefits which require an active Agency s Agreement. Termination for cause shall be: (i) material violation of any of the provisions of this Agreement or published Lincoln policy relating to Agency conduct; (ii) material violation of any state or federal laws or regulations relating to insurance; (iii) revocation of the Agency s insurance license by the Insurance Department of any state or barring of any association with a FINRA member firm; (iv) inducing or attempting to induce Lincoln policyowners to relinquish or replace the Policies with such frequency as to indicate a pattern of inappropriate activity, as determined solely by Lincoln; Group Protection Agency Agreement Enrollment Firm v of 9

10 (v) misappropriation or commingling of Lincoln funds; or (vi) engaging in a fraudulent act or misrepresenting Policy benefits, provisions, or premiums. (d) A termination under Section (a) or (b) immediately above will not preclude a later termination for cause. 20. Compensation Payable After Termination. In the event of such termination, commissions, fees and allowances for the first policy year and for renewal years, with respect to applications submitted by Agency and its Agents prior to the date of termination, shall be payable, based upon the applicable compensation schedule set forth in Schedule A1, Single Case Compensation Agreement(s) or other applicable compensation agreement signed by both parties and in effect at the time of termination; provided, however, if such termination is due to a for cause termination set forth in Section 19(c), no further compensation shall be paid. 21. Indebtedness. (a) Lincoln is authorized, at any time either before or after the termination of the Agreement, to deduct compensation due from Lincoln to the Agency, whether payable hereunder or with respect to Policies which are administered or insured by Lincoln, the entire amount of any funds, including, but not limited to, advances or debts, owed by the Agency to Lincoln or its affiliates, associates, parents or subsidiaries, but only to the extent of the actual amount owed by the Agency as determined by Lincoln. (b) Any compensation, regardless of how characterized, paid to the Agency for premiums or considerations, including rollover amounts, later returned or credited to the customer, or any overpayment of such compensation shall be a debt due to Lincoln from the Agency and payable in accordance with (a) above. (c) In addition to all other rights available to Lincoln as a creditor, Lincoln shall have a first lien on all compensation payable under the Agreement for any of the funds, advances or debts described herein. (d) To the extent that any compensation due the Agency from Lincoln is insufficient to cover advances or other debts, the difference shall become a debt due and payable immediately to Lincoln unless other arrangements have been made with Lincoln. At the sole discretion of Lincoln, interest, at a lawful rate to be determined by Lincoln, shall thereupon begin to accrue. (e) In the event Lincoln initiates collection efforts or legal action to collect any indebtedness of Agency or its producers, Agency shall reimburse Lincoln for reasonable attorney fees and expenses in connection therewith. 22. Indemnification. (a) Lincoln shall indemnify and hold the Agency and each director and officer of and any person controlling the Agency harmless from any and all costs, expenses, losses, claims, damages or liabilities (or actions in respect thereto), including reasonable attorneys fees resulting from negligent, fraudulent or unauthorized acts or omissions by Lincoln or its employees. (b) The Agency shall indemnify and hold Lincoln harmless from any and all costs, expenses, losses, claims, damages or liabilities (or actions in respect thereof), including reasonable attorneys fees, resulting from the following: (i) any negligent, fraudulent or unauthorized acts or omissions by the Agency, its officer s director and Representatives; (ii) any unauthorized use of sales materials or advertising or any oral or written misrepresentations or any unlawful sales practices with respect to the Policies by the Agency, its officer s directors and Representatives; and (iii) claims made by any of the Agency s Representatives for compensation over and above that which is specifically agreed upon this Agreement. The foregoing indemnities shall, upon the same terms and conditions, extend to and inure to the benefit of each director and officer of and any person controlling, Lincoln. The foregoing indemnities shall not extend to losses, claims, damages or liabilities (or actions in respect thereto) arising out of death claims or claims related to the mortality risks of the Policies. 23. Assignability. Neither party hereto shall assign this Agreement without the prior written consent of the other; provided, however, that Lincoln may assign or transfer this Agreement (including all of its rights and obligations), without notice to Agency, to (a) a corporation or other entity into which or with which Lincoln is merged or consolidated; or (b) a corporation or other entity acquiring all or substantially all of the assets of Lincoln and/or assuming all and/or substantially all of the liabilities of Lincoln. Any approved assignment shall be subject to a first lien to Lincoln for any indebtedness owed to Lincoln. Any attempt to assign this Agreement without such consent shall effect an immediate termination of this Agreement. 24. Waiver. Failure of any party to insist upon strict compliance with any of the conditions of this Agreement shall not be construed as a waiver of any of the conditions, but the same shall remain in full force and effect. No waiver of any of the Group Protection Agency Agreement Enrollment Firm v of 9

11 provisions of this Agreement shall be deemed, or shall constitute a waiver of any other provisions, whether or not similar, nor shall any waiver constitute a continuing waiver. 25. Partnerships. When the Agency is a partnership or corporation, any reference made to the Agency shall be deemed to mean the partners or the officers of the corporation who are licensed and appointed with Lincoln. 26. Notice. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the party to whom notice is to be given, or (b) on the Business Day after delivery to an overnight courier (such as Federal Express) or an overnight mail service (such as the Express Mail service) maintained by the United States Postal Service, to the Party as follows: In the case of Lincoln: The Lincoln National Life Insurance Company/Lincoln Life & Annuity Company of New York Producer Solutions MPC9 350 Church Street Hartford, CT Lincoln Financial Group In the case of Agency Attn: Address: With a copy to: The Lincoln National Life Insurance Company/Lincoln Life & Annuity Company of New York Office of the General Counsel 150 N Radnor Chester Road Radnor, PA In the case of Principal Name: Address: 27. Service of Process. The Agency is not Lincoln s authorized producer or representative to accept service of legal process and therefore, the Agency should not accept service. If, however, any paper is served upon the Agency, the Agency shall send by certified mail the same to Lincoln s General Counsel at 150 N Radnor Chester Road, Radnor, PA by certified mail within 24 hours after receipt. 28. Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of Indiana without regard to principles of conflict or choice of law. The U.S. federal and state courts of the State of Indiana located in Allen County shall have sole and exclusive jurisdiction and venue to adjudicate over any actions related to the subject matter of this Agreement. 29. Waiver of Jury Trial. AGENCY AND LINCOLN IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM, COUNTERCLAIM OR CROSS-COMPLAINT IN ANY ACTION OR OTHER PROCEEDING BROUGHT BY THE OTHER WITH RESPECT TO ANY MATTER ARISING OUT OF, OR IN ANY WAY CONNECTED WITH OR RELATED TO THIS AGREEMENT. 30. Entire Agreement. This Agreement, together with the attachments hereto, supersedes all previous oral and written agreements between Agency and Lincoln and contains the entire understanding of the Agreement between the parties with respect to the subject matter hereof. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and together shall constitute one and the same instrument. Any and all counterparts may be delivered by facsimile or Amendment. Lincoln may unilaterally amend this Agreement upon forty-five (45) days advance written notice. If Agency objects to such amendment, Agency may exercise its right to terminate this Agreement upon thirty (30) days advance written notice to Lincoln. Agency does not have a right to unilaterally amend the Agreement. 32. Survival. The terms of this Agreement that by their nature should survive termination of this Agreement shall survive termination of this Agreement including, without limitation, the provisions concerning protection of Confidential Information, indemnification, and Sections 10 through 12, 15 18(d), 20 through 22, 27through 29, and 32. Group Protection Agency Agreement Enrollment Firm v of 9

12 IN WITNESS WHEREOF, the parties hereto have executed this Agreement. THE LINCOLN NATIONAL LIFE INSURANCE COMPANY By: Its: Date: LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK By: Its: Date: AGENCY By: Signature Print Name and Title of Signer Its: Title Date: PRINCIPAL Name of Principal Print Name and Title of Signer Signature Date: Group Protection Agency Agreement Enrollment Firm v of 9

13 Schedule C1 Agent Requirements AGENCY hereby certifies to The Lincoln National Life Insurance Company and Lincoln Life & Annuity Company of New York (individually and collectively "Lincoln") that all of the below listed requirements will be fulfilled in conjunction with the submission by Agency of appointment papers for all applicants Agents seeking appointment as agents of Lincoln. AGENCY will, upon request, forward proof of compliance with same to the Lincoln in a timely manner. 1. Agency performed a thorough and diligent inquiry and investigation relative to each Agent applicant's identity, residence, business reputation, and experience and declare that each Agent applicant is personally known to Agency, has been examined by Agency, is known to be of good moral character, has a good business reputation, is reliable, is financially responsible and is worthy of appointment as an appointed agent of Lincoln. This inquiry and background investigation has included an appropriate background check, including but not limited to a criminal check on each Agent applicant. Based upon Agency s investigation, Agency vouches for each Agent applicant and certifies that each individual is trustworthy, competent and qualified to act as an Agent for the Lincoln to hold himself or herself out in good faith to the general public. 2. The above information in Agency s files indicates no fact or condition which would disqualify the Agent applicant from holding an insurance license or receiving an appointment with Lincoln and all the findings of all investigative information is favorable. 3. Agency certifies that all educational requirements have been met for the specific state each Agent applicant is licensed in, and that, all such persons have fulfilled the appropriate examination, education and training requirements. 4. Agency certifies that each Agent applicant will receive close and adequate supervision, and that Agency will make inspection when needed of any or all risks written by these applicants Agents, to the end that the insurance interest of the public will be properly protected. 5. Agency will not permit any Agent applicant to transact insurance as an agent until duly licensed and appointed by the Lincoln. No Agent applicants have been given a contract or furnished supplies, nor have any Agent applicants been permitted to write, solicit business, or act as an agent in any capacity, and they will not be so permitted until the certificate of authority applied for is received. 6. Agency shall promptly notify the Lincoln should the Agency terminate any of its Agents who are appointed with Lincoln for performance, non-performance or breach of or relating to this Agreement, including, but not limited to, any unauthorized use of sales materials, any misrepresentations or any sales practices concerning the Policies or who are found to be in violation of any federal or state securities or insurance laws involving fraud, deceit, or knowing misrepresentations. Group Protection Agency Agreement Enrollment Firm v of 9

14 The Lincoln National Life Insurance Company Lincoln Life & Annuity Company of New York Service Office Address: Attn: Licensing, PO Box 2616, Omaha, NE Home Office: Syracuse, NY Fax (877) Phone (800) AGREEMENT WITH BUSINESS ASSOCIATE REGARDING USE & DISCLOSURE OF CONSUMER HEALTH AND FINANCIAL INFORMATION This Business Associate Agreement ( Agreement ) is made and entered into by and between The Lincoln National Life Insurance Company and/or Lincoln Life & Annuity Company of New York together with its affiliates ( Covered Entity ) and ( Business Associate ), and is effective this day of, 20. Recitals A. Covered Entity has retained Business Associate to provide certain services relating to the marketing, sale and/or administration of Covered Entity s insurance products and services (the Services ), which may involve the use and/or disclosure of individually identifiable health information. B. The parties acknowledge and agree that in order to perform the Services, certain personnel may be required to access, maintain, retain, modify, record, store, destroy or otherwise hold, use or disclose individually identifiable health information ( Protected Health Information ), and therefore Business Associate may be considered a business associate of Covered Entity as that term is defined in 45 CFR , and be subject to the federal Health Insurance Portability and Accountability Act ( HIPAA ), the Health Information Technology for Economic and Clinical Health Act ( HITECH ), regulations promulgated under these laws, state health information privacy laws, and Title V of the Gramm-Leach-Bliley Act (15 USC 6801 et seq.) (collectively, Privacy Laws ). C. Accordingly, the parties hereto agree to the terms and conditions set forth below: 1. Definitions Terms used, but not otherwise defined, in this Agreement shall have the same meaning as those terms by HIPAA, HITECH, and the regulations promulgated under these Privacy Laws. 2. Obligations and Activities of Business Associate a. Use or Disclosure of Protected Health Information - Business Associate agrees not to use or disclose Protected Health Information, other than as permitted or required by the Agreement or as required by law. b. Safeguards - Business Associate agrees to develop, implement, maintain, and use appropriate and effective administrative, technical, and physical safeguards and comply with Subpart C of 45 CFR Part 164 with respect to Electronic Protected Health Information, in order to comply with Privacy Laws and prevent use or disclosure of the Protected Health Information other than as provided for by this Agreement. Business Associate agrees to keep these safeguards current and document them in written policies, standards, procedures or guidelines, which Business Associate will provide to Covered Entity upon Covered Entity s request. c. Breach Notification - Business Associate agrees to report to Covered Entity any known or suspected Breach, Security Incident or other Use or Disclosure of Protected Health Information which is not permitted under the terms of this Agreement (collectively, the Incident ). Such notification shall comply with Privacy Laws and shall: (i) Be made via to Lincoln s Corporate Privacy Office at privacy@lfg.com. (ii) Be made within three (3) days after discovery. (iii) Include the names of the Individuals whose information was breached, the circumstances surrounding the breach, the date of the breach and date of discovery, the information breached, any steps the Individuals should take to protect themselves, the steps Business Associate (or its agent or subcontractor) is taking to investigate the breach, mitigate losses, and protect against future breaches, and a contact person for more information. Covered Entity shall have sole control over the timing and method of providing notification of Breach to the affected individual(s) or others as required by Privacy Laws. If requested by Covered Entity, Business Associate shall notify, at its own cost, the Individuals involved, or the media or the US Department of Health and Human Services, as applicable, in accordance with the Privacy Laws, including 45 CFR Part 164, Subpart D, provided that Covered Entity shall approve the content of any notification in advance. If requested by Covered Entity, Business Associate shall reimburse Covered Entity for any costs associated with Covered Entity making such notifications. For purposes of this provision, Business Associate is considered an independent contractor of Covered Entity. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Page 1 of 3 GLM /14

15 d. Duty to Mitigate - Business Associate agrees to mitigate, to the extent practicable, any harmful effect that is known to Business Associate relating to an Incident or any other use or disclosure of Protected Health Information by Business Associate in violation of the requirements of this Agreement. If requested by Covered Entity, Business Associate will provide credit monitoring services and/or other reasonable services to individuals as part of mitigating harm under this Section. Business Associate shall be responsible for all costs of mitigation under this Section. e. Agents - In accordance with 45 CFR (e)(1)(ii) and (b)(2), if applicable, Business Associate agrees to ensure that any agent, including a subcontractor, to whom it provides Protected Health Information received from, or created or received by Business Associate on behalf of Covered Entity agrees to the same restrictions and conditions that apply to Business Associate with respect to such information. f. Access to Secretary - Unless otherwise protected or prohibited from discovery or disclosure by law, Business Associate agrees to make internal practices, books, and records, including policies and procedures and Protected Health Information, relating to the use and disclosure of Protected Health Information received from, or created or received by Business Associate on behalf of, Covered Entity available to the Secretary of Health and Human Services and the Covered Entity, for purposes of the Secretary determining Covered Entity s compliance with Privacy Laws within 10 days after the Business Associate s receipt of such request. g. Access to Individuals - Business Associate agrees to make available to the Covered Entity, Protected Health Information in a Designated Record Set, or, if directed by Covered Entity, to make available to an Individual in order to meet the requirements under 45 CFR Except as provided for in this Agreement, in the event Business Associate receives an access request directly from an Individual, Business Associate will redirect the Individual to the Covered Entity within ten (10) business days after the Business Associate s receipt of such request. h. Amendment of Protected Health Information - Business Associate agrees to make any amendment(s) to Protected Health Information it holds in a Designated Record Set, as directed, or agreed to, by the Covered Entity pursuant to 45 CFR , and in the time and manner reasonably requested by Covered Entity. Except as provided for in this Agreement, in the event Business Associate receives an amendment request directly from an Individual, Business Associate will redirect the Individual to the Covered Entity within ten (10) business days after the Business Associate s receipt of such request. i. Accounting of Disclosures - Business Associate agrees to document and provide a description of any disclosures of Protected Health Information and information related to such disclosures as would be required for Covered Entity to respond to a request by an Individual for an accounting of disclosures of Protected Health Information in accordance with 45 CFR Business Associate agrees to provide such information to Covered Entity, or to an Individual at the direction of the Covered Entity, in order for Covered Entity to comply with the accounting requirements in 45 CFR Except as provided for in this Agreement, in the event Business Associate receives an access, amendment, accounting of disclosure or other similar request directly from an Individual, Business Associate will redirect the Individual to the Covered Entity within five (5) business days after the Business Associate s receipt of such request. Business Associate understands that Covered Entity may maintain an electronic health record, and therefore to the extent uses and disclosures are made through an electronic record in connection with the Services Agreement, Business Associate must account for uses and disclosures related to treatment, payment, and health care operations. j. Covered Entity s Right to Restrict - Business Associate agrees to comply, upon communication by Covered Entity, with any restrictions to the use or disclosure of Protected Health Information that Covered Entity has agreed to or is required to abide by in accordance with 45 CFR To the extent the Business Associate is to carry out any other of Covered Entity s obligation(s) under Subpart E of 45 CFR Part 164, Business Associate agrees to comply with the requirements of Subpart E that apply to the Covered Entity in the performance of such obligation(s). 3. Permitted Uses and Disclosures by Business Associate a. Business Associate agrees that it shall keep confidential all Protected Health Information as required by Privacy Laws, information that Business Associate receives, creates, or maintains under and/or in connection with this Agreement, and shall not use or disclose Protected Health Information except as permitted or required by this Agreement, the Services Agreement, or by law. Business Associate may not use or disclose Protected Health Information in a manner that would violate Subpart E of 45 CFR Part 164 if done by Covered Entity except as permitted by this Agreement. b. Business Associate shall determine the amount of Protected Health Information necessary for its purposes and shall limit its requests, uses, and disclosures to the minimum necessary as required by Privacy Laws. Business Associate shall follow any minimum necessary policies and procedures provided by Covered Entity. c. Business Associate acknowledges it is authorized to use or disclose Protected Health Information for Business Associate s management and administration and to fulfill any of Business Associate s legal responsibilities. In instances where the Use or Disclosure is not required by law, Business Associate shall obtain reasonable assurances from the third-party recipient of Protected Health Information that: (i) the Protected Health Information will be held confidentially and used or further disclosed only as required by law or for the purposes for which it was disclosed to the third party; and (ii) the third party will notify Business Associate of any instances of which the third party is aware in which the confidentiality of the Protected Health Information has been breached. Page 2 of 3 GLM /14

16 d. Business Associate may use Protected Health Information to provide data aggregation services to Covered Entity relating to its health care operations e. All other uses or disclosures by Business Associate not authorized by this Agreement or by specific instruction of Covered Entity are prohibited. 4. Amendment a. The parties agree to take such action as is necessary to comply with the requirements of the Privacy Laws, as amended, and any other applicable laws. Covered Entity shall have the right to amend this Agreement at any time through the addition or modification of addendums to this Agreement in order to comply with Privacy laws and other laws and regulations all applicable to business associate relationship. The Agreement will automatically be amended such that the obligations imposed on either or both Parties will allow the Parties to remain in compliance with such regulations and laws. 5. Term and Termination a. Term. Upon termination of the Services Agreement, this Agreement shall terminate and Business Associate will destroy or return to Covered Entity any Protected Health Information it holds in any form. This provision also applies to Protected Health Information that is in the possession of subcontractors or agents of Business Associate. Business Associate will retain no copies of the Protected Health Information. If Business Associate reasonably can show that it is infeasible to return or destroy Protected Health Information, and the Covered Entity agrees, Business Associate must extend the protections under this Agreement to such Protected Health Information and only may further use or disclose such information for those purposes that make the return or destruction infeasible. b. Termination for Cause. Upon Covered Entity s knowledge of a material breach of this Agreement by Business Associate, Covered Entity is authorized to terminate this Agreement and the Services Agreement. 6. Miscellaneous a. Indemnification. Business Associate agrees to indemnify, defend, and hold harmless Covered Entity from and against any action, claim, demand, loss, liability, fine, penalty or expense (including attorneys and witnesses fees and expenses) arising out of or resulting, directly or indirectly, in any way from any breach by Business Associate of any term hereof or from any act or omission of its agents, employees or subcontractors. b. Regulatory References. A reference in this Agreement to a section in the Privacy Laws means the section as in effect or as amended. c. Survival. Business Associate s obligations in respect of the use, disclosure and protection of Protected Health Information shall survive any termination of this Agreement. d. Interpretation. Any ambiguity in this Agreement shall be resolved to permit Covered Entity to comply with the Privacy Laws. IN WITNESS WHEREOF, the parties execute this Agreement by their duly authorized representatives. Covered Entity Business Associate Signature Title: SVP- Group Underwriting, Product, and Operations Date: Title: Date: Page 3 of 3 GLM /14

17 Lincoln Life & Annuity Company of New York, PO Box 2609, Omaha, NE Home Office: Syracuse, NY toll free (800) Fax (402) Anti-Money Laundering Training Certification for Brokers and Enrollers Selling Lincoln Employee Value Universal Life Lincoln Financial Group ( Lincoln ), as a responsible member of the financial services industry, opposes money laundering and other activities that facilitate money laundering or the funding of terrorist or criminal activities. Lincoln is strongly committed to comply with all laws and regulations designed to combat money laundering activity, including those rules and regulations requiring the reporting of transactions involving currency, certain monetary instruments, and suspicious activity. On October 31, 2005, the Department of Treasury issued final regulations with respect to Anti-Money Laundering Programs for Insurance Companies, effective May 2, The life insurance companies of the Lincoln Financial Group are subject to these regulations. The regulations require insurance companies to develop an anti-money laundering ( AML ) program, which includes training. The AML regulations apply to the following covered products: d Permanent life insurance, other than group life insurance; d Annuity contracts, other than a group annuity contract; d Any other insurance product with features of cash value or investment. It is Lincoln s responsibility to ensure that all appropriate persons receive training on money laundering prevention on a regular basis; fully understand relevant AML procedures and their importance; and understand the ramifications of non-compliance. The final regulations require insurance companies to train their insurance producers regarding their responsibilities in terms of AML including identifying suspicious customer behavior and transactions as well as procedures to report suspicious activities. An ongoing training program is a core element of the AML regulations. The final regulation allows for training to be provided directly via an in-house training program or by a competent third party. Lincoln is ultimately responsible for monitoring the effectiveness of its training program and assuring compliance with these regulations. As a broker or enroller involved in the selling of Lincoln s Employee Value Universal Life insurance product, you are in a critical position to obtain information regarding the customer, the customer s source of funds for the products you sell, and the customer s reasons for purchasing an insurance product. You have a responsibility in the following four areas: d Information Gathering: Effective customer due diligence is based on appropriate and accurate information about our customers. You will be responsible for obtaining this information at the point of sale. Ensure that all information requested on the insurance application and associated documents is accurate and complete. d Methods of Payment: As noted in the section on Cash/Cash Equivalents below, Lincoln has established standards for acceptable and unacceptable forms of payment. You are responsible for ensuring that appropriate payment guidelines are followed, and that attempts to engage in inappropriate payment behavior are reported to Lincoln. d Communication: You are the first line of defense in the detection of suspicious activity. You are responsible for bringing suspicious behavior to Lincoln s attention and cooperate with Lincoln s requests for information in the course of reviews of customers and their activities. d Training: Because you are selling a product covered by the AML rules, you must receive training to help you identify the red flags associated with money laundering, terrorist financing, and other financial crimes and how to report such activity to Lincoln. What is Money Laundering? Money laundering is a series of transactions that convert illegally-obtained funds into funds that appear to be from legal activities. The money laundering process is comprised of three phases: d Placement: The illicit proceeds are deposited into the financial system through transactions such as bank deposits or the purchase of insurance products. d Layering: The illicit proceeds are separated from their criminal source through complex financial transactions. d Integration: The proceeds are put back into circulation into the economy with the appearance of legality. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. Page 1 of 4 GLA /13

18 Customer Identification Program Although the U.S. Treasury Department and the Financial Crimes Enforcement Network ( FinCEN ) have not issued final regulations regarding customer identification program ( CIP ) procedures for insurance companies, under the AML regulations, insurance companies issuing or underwriting covered products are required to obtain relevant customer-related information necessary for an effective antimoney laundering program. Relevant customer-related information includes: 1. The customer s name; 2. The customer s date of birth; 3. The customer s address, which will be a residential or business street address (for an individual), an Army Post Office ( APO ) or Fleet Post Office ( FPO ) box number, or residential or business street address of next of kin or another contact individual (for an individual who does not have a residential or business street address), or a principal place of business, local office, or other physical location (for a person other than an individual); and 4. The customer s identification number, which will be a taxpayer identification number (for U.S. persons). Lincoln uses the application forms for its life insurance products to collect the above information. Lincoln requires all questions on applications to be fully and accurately completed. If a potential or existing customer either refuses to provide the information described above when requested, or appears to have intentionally provided misleading information, Lincoln will not open a new life insurance policy and, after considering the risks involved, consider closing any existing policy. Appropriate documents for verifying the identity of customers include the following: d For an individual, an unexpired government-issued identification evidencing nationality or residence, and bearing a photograph or similar safeguard, such as a driver s license or passport. d For a person other than an individual, documents showing the existence of the entity, such as certified articles of incorporation, a government-issued business license, a partnership agreement, or a trust instrument. You are not required to take steps to determine whether the document that the customer has provided for identity verification has been validly issued, and you may rely on a government-issued identification as verification of a customer s identity. If, however, you note that the document shows some obvious form of fraud, you must consider that factor in determining whether you can form a reasonable belief that you know the customer s true identity. You should immediately report any concerns regarding the validity of a customer s identification documents to EnterpriseServiceAML@lfg.com. You can request Lincoln to conduct a non-documentary method of verification when: 1. The customer is unable to present an unexpired government-issued identification document with a photograph or other similar safeguard; 2. You are unfamiliar with the documents the customer presents for identification verification; 3. You do not have face-to-face contact with the customer; or 4. There are other circumstances that increase the risk that you will be unable to verify the true identity of the customer through documentary means. Lincoln will verify the information within a reasonable time before or after the account is opened. Depending on the nature of the account and requested transactions, Lincoln may refuse to complete a transaction before we have verified the information, or in some instances when we need more time, we may, pending verification, restrict the types of transactions or dollar amount of transactions. Lincoln does not open accounts outside of the US. However, we recognize that the risk that we may not know the customer s true identity may be heightened for certain types of accounts, such as an account opened in the name of a corporation, partnership or trust that is created or conducts substantial business in a jurisdiction that has been designated by the U.S. as a primary money laundering jurisdiction, a terrorist concern, or has been designated as a non-cooperative country or territory. The following types of accounts do not require CIP: d An account opened for the purpose of participating in an employee benefit plan established under ERISA. d An account owned by a financial institution regulated by a Federal functional regulator or a bank regulated by a state bank regulator. d An account owned by a department or agency of the United States, of any State, or of any political subdivision of any State. d An account owned by an entity whose common stock or analogous equity interests are listed on the New York Stock Exchange, the American Stock Exchange, or NASDAQ. Page 2 of 4 GLA /13

19 You should document your identification verification, including all identifying information provided by a customer, the methods used and results of verification, and the resolution of any discrepancies identified in the verification process. You should keep records containing a description of any document that you relied on to verify a customer s identity, noting the type of document, any identification number contained in the document, the place of issuance, and the date of issuance and expiration date if applicable. You should also keep records containing a description of the resolution of each substantive discrepancy discovered when verifying the identifying information obtained. You must retain records of all identification information for five years after the account has been closed, and you must retain records made about verification of the customer s identity for five years after the record is made. Lincoln compares its customer database against the Office of Foreign Asset Control s ( OFAC ) list of known or suspected terrorists and sanctioned countries. Lincoln will, within a reasonable period of time, determine whether a customer appears on any such list of known or suspected terrorists or terrorist organizations. Lincoln will continue to comply with OFAC rules prohibiting transactions with certain foreign countries or their nationals. Suspicious Activity You must notify Lincoln if you detect any suspicious activity, also referred to as red flags. Lincoln s AML, Fraud & Investigations Unit will determine whether a Suspicious Activity Report ( SAR ) must be filed with FinCEN. See the section on Reporting of Suspicious Activity for further information on this process. Examples of red flags to note include, but are not limited to: d The purchase of a product that appears to be inconsistent with a customer s needs d The purchase or funding of a product that appears to exceed a customer s known income or liquid net worth d Any attempted unusual method of payment, particularly by cash or cash equivalents such as money orders or cashier checks. As the Employee Value Universal Life insurance product is marketed as a payroll deduction type of plan, any efforts to pay premiums in another fashion should be closely scrutinized. d Payment of a large amount broken into small amounts d Little or no concern by a customer for the investment performance of an insurance product, but much concern about the early termination features of the product d The early termination of an insurance policy, especially at a cost to the customer, or where the refund or surrender check is directed to an apparently unrelated third party. d The borrowing of the maximum amount available soon after purchasing the policy. d The reluctance by a customer to provide identifying information, a customer provides information that seems fictitious, or the customer provides information that cannot be verified d Funding of an irrevocable life insurance trust with funds that do not come from the insured who is named in the trust Reporting of Suspicious Activity The AML Compliance Officer has the sole responsibility for responding to any inquiry regarding the subject matter of any SAR. A producer must not, under any circumstances, disclose the fact that a SAR has been filed or considered, or disclose the contents of a SAR, to the subject of a SAR or to any third party. You should report any suspicious activity to the AML Compliance Officer via to EnterpriseServiceAML@lfg.com. It is critical that you report suspicious activity immediately upon discovery. Failure to report suspicious activity may be deemed to be willful blindness, which can lead to substantial penalties and fines by FinCEN and other regulatory authorities. Cash/Cash Equivalents You should advise customers that the following types of premium payments may be accepted: d Personal checks drawn on U.S. banks. d Wire transfers drawn on U.S. banks. d Electronic fund transfers or automated clearing house drafts drawn on U.S. banks. d Foreign bank drafts drawn on U.S. bank affiliates. d Corporate checks drawn on U.S. banks. d Cash equivalents (money orders, cashier s checks, official checks, bank checks, treasurer s checks, traveler s checks, postal checks) $10,000 or over. Page 3 of 4 GLA /13

20 If a customer provides a form of payment that is not permitted, it must be returned immediately. The following forms of payment are not accepted by Lincoln: d Cash, i.e., coin and currency d Cash equivalents (money orders, cashier s checks, official checks, bank checks, treasurer s checks, traveler s checks, postal checks) under $10,000 d Starter or counter checks, unless accompanied by a verification of deposit form from the bank d Checks and/or wire transfers from third parties where there is not a valid or documented relationship d Foreign checks, bank drafts and/or wire transfers directly from foreign bank accounts d Checks, bank drafts and/or wire transfers in non-u.s. currency d Checks with double endorsements (unless the check is made payable to two people and both individuals are on the Lincoln account) d Checks payable to Cash d Stale-dated checks over 180 days from issue date d Checks drawn against credit lines, e.g., VISA, Discover d Checks payable to producers d Checks from producers, unless the policy is for the benefit of the producer or the producer s immediate family member Training This certification serves as the AML training for the brokers and enrollers who sell Lincoln s Employee Value Universal Life insurance product. If you are appointed to sell individual insurance products with Lincoln, you are required to receive this anti-money laundering training periodically. If you keep your appointment active with Lincoln, you will receive a reminder of this training once every two years. Lincoln and its producers share an important responsibility to comply with our AML program and all applicable anti-money laundering laws. A failure to do so will constitute grounds for discipline, up to and including termination. In addition, violation of anti-money laundering laws may expose those responsible to substantial penalties under federal law. For more details on these training requirements, please refer to Lincoln s AML web site at, If you have questions, please click the Contact Us button on our AML web site or send an to EnterpriseServiceAML@LFG.com. Certification By my signature below, I declare and certify that I have read and understand the Anti-Money Laundering Training for Brokers and Enrollers Selling Lincoln Employee Value Universal Life. Broker or Enrollee Signature: Date: Page 4 of 4 GLA /13