ALLOWANCES PAID BY ALFS WITH REGARDS TO THE CONTRACTS UNDER
THE PROPRIETARY CHANNEL WHOLESALING AND MARKETING SUPPORT AGREEMENT DATED
JUNE 1, 2006 BETWEEN LBL, ALFS, ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK,
AMERICAN SKANDIA MARKETING, INC. AND PRUDENTIAL INSURANCE AGENCY, LLC,
(B) COMMISSIONS AND TRAIL COMMISSIONS PAYABLE UNDER SELLING AGREEMENTS IN
CONNECTION WITH THE CONTRACTS AMONG BROKER-DEALERS, LBL AND ALFS, (C) THE COSTS
OF GOODS AND SERVICES PURCHASED FROM OUTSIDE VENDORS, (D) TRAVEL EXPENSES AND
(E) STATE AND FEDERAL REGULATORY FEES INCURRED ON BEHALF OF LBL.
5.02.
ALFS SHALL PRESENT A STATEMENT AFTER THE END OF EACH QUARTER
SHOWING THE AMOUNT DUE WITH RESPECT TO MARKETING ALLOWANCES AS PROVIDED IN
SECTION 5.01 AND THE APPORTIONMENT OF OTHER SERVICES RENDERED AND THE DIRECT
EXPENSES INCURRED IN CONNECTION THEREWITH.
SETTLEMENTS ARE DUE AND PAYABLE
WITHIN THIRTY DAYS.
ARTICLE VI.
UNDERWRITING TERMS
6.01.
ALFS MAKES NO REPRESENTATIONS OR WARRANTIES REGARDING THE NUMBER OF
CONTRACTS TO BE SOLD BY SELLING BROKER-DEALER AND THE REGISTERED REPRESENTATIVES
OF SELLING BROKER-DEALER.
ALFS DOES, HOWEVER, REPRESENT THAT IT WILL ACTIVELY
ENGAGE IN ITS DUTIES UNDER THIS AGREEMENT ON A CONTINUOUS BASIS WHILE THERE ARE
EFFECTIVE REGISTRATION STATEMENTS WITH THE SEC.
6.02.
ALFS WILL USE ITS BEST EFFORTS TO ENSURE THAT THE CONTRACTS SHALL
BE OFFERED FOR SALE BY REGISTERED BROKER-DEALERS AND REGISTERED REPRESENTATIVES
(WHO ARE DULY LICENSED AS INSURANCE AGENTS) ON THE TERMS DESCRIBED IN THE
CURRENTLY EFFECTIVE PROSPECTUS DESCRIBING SUCH CONTRACTS.
6.03.
LBL WILL USE ITS BEST EFFORTS TO ASSURE THAT THE CONTRACTS ARE
CONTINUOUSLY REGISTERED UNDER THE 1933 ACT (AND UNDER ANY APPLICABLE STATE "BLUE
SKY" LAWS) AND TO FILE FOR APPROVAL UNDER STATE INSURANCE LAWS WHEN NECESSARY.
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ARTICLE VII.
LEGAL AND REGULATORY ACTIONS
7.01.
LBL AGREES TO ADVISE ALFS IMMEDIATELY OF:
(A)
ANY REQUEST BY THE SEC FOR AMENDMENT OF THE
REGISTRATION STATEMENTS OR FOR ADDITIONAL INFORMATION RELATING TO THE CONTRACTS;
(B)
THE ISSUANCE BY THE SEC OF ANY STOP ORDER
SUSPENDING THE EFFECTIVENESS OF THE REGISTRATION STATEMENTS RELATING TO THE
CONTRACTS OR THE INITIATION OF ANY PROCEEDINGS FOR THAT PURPOSE; AND
(C)
THE HAPPENING OF ANY KNOWN MATERIAL EVENT
WHICH MAKES UNTRUE ANY STATEMENT MADE IN THE REGISTRATION STATEMENTS RELATING TO
THE CONTRACTS OR WHICH REQUIRES THE MAKING OF A CHANGE THEREIN IN ORDER TO MAKE
ANY STATEMENT MADE THEREIN NOT MISLEADING.
7.02.
EACH OF THE UNDERSIGNED PARTIES AGREES TO NOTIFY THE OTHER IN
WRITING UPON BEING APPRISED OF THE INSTITUTION OF ANY PROCEEDING, INVESTIGATION
OR HEARING INVOLVING THE OFFER OR SALE OF THE SUBJECT CONTRACTS.
7.03.
DURING ANY LEGAL ACTION OR INQUIRY, LBL WILL FURNISH TO ALFS SUCH
INFORMATION WITH RESPECT TO THE CONTRACTS IN SUCH FORM AND SIGNED BY SUCH OF ITS
OFFICERS AS ALFS MAY REASONABLY REQUEST AND WILL WARRANT THAT THE STATEMENTS
THEREIN CONTAINED WHEN SO SIGNED ARE TRUE AND CORRECT.
7.04.
IF CHANGES IN INSURANCE LAWS OR REGULATIONS COULD REASONABLY BE
EXPECTED TO AFFECT THE SALES AND ADMINISTRATION OF CONTRACTS UNDER THIS
AGREEMENT, LBL SHALL NOTIFY ALFS WITHIN A REASONABLE TIME AFTER LBL RECEIVES
NOTICE OF THOSE