EXHIBIT (8)(PP)
SHAREHOLDER INFORMATION AGREEMENT
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST
This Shareholder Information Agreement ("Agreement") is entered into as of
April 16, 2007, and is among Franklin/Xxxxxxxxx Distributors, Inc.
("Distributors") on behalf of each Fund, as defined below, and the Intermediary,
as defined below. Unless otherwise specified, capitalized terms have the meaning
set out under "Definitions," below.
WHEREAS, Intermediary is a "financial intermediary" as that term is defined
in Rule 22c-2 under the Investment Company Act of 1940, as amended (the "1940
Act"); and
WHEREAS, Distributors serves as the principal underwriter to the Funds; and
WHEREAS, Distributors and Intermediary wish to enter into this Agreement in
accordance with Rule 22c-2 under the 1940 Act.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
which consideration is full and complete, Distributors and Intermediary hereby
agree as follows:
1. SHAREHOLDER INFORMATION
1.1 AGREEMENT TO PROVIDE INFORMATION. Intermediary agrees to provide the
Fund or its designee, upon written request, the taxpayer identification number
("TIN"), the Individual/International Taxpayer Identification Number ("ITIN"),
or other government-issued identifier ("GII") and the Contract owner number or
participant account number associated with the Shareholder, if known, of any or
all Shareholder(s) of the account, and the amount, date and transaction type
(purchase, redemption, transfer, or exchange) of every purchase, redemption,
transfer, or exchange of Shares held through an account maintained by
Intermediary during the period covered by the request. Unless otherwise
specifically requested by the Fund or its designee, Intermediary shall only be
required to provide information relating to Shareholder-Initiated Transfer
Purchases or Shareholder-Initiated Transfer Redemptions.
1.1.1 PERIOD COVERED BY REQUEST. Requests must set forth a specific
period, not to exceed ninety (90) days from the date of the request, for
which transaction information is sought. The Fund or its designee may
request transaction information older than ninety (90) days from the date
of the request as it deems necessary to investigate compliance with
policies established by the Fund for the purpose of eliminating or reducing
any dilution of the value of the outstanding shares issued by the Fund.
(A) TIMING OF REQUESTS. Requests from the Fund or its designee for
Shareholder information shall be made no more frequently than
1
quarterly except as the Fund or its designee deems necessary to
investigate compliance with policies established by the Fund or
its designee for the purpose of eliminating or reducing any
dilution of the value of the outstanding shares issued by the
Fund.
1.1.2 FORM AND TIMING OF RESPONSE.
(A) Intermediary agrees to provide, promptly upon request of the Fund
or its designee, the requested information specified in Section
1.1, above. If such request covers a period ninety (90) to one
hundred eighty (180) days prior to the date of the request,
Intermediary agrees to use its best efforts to provide the
information specified in 1.1 within five (5) to ten (10) business
days. If Intermediary determines during the course of
investigation that due to the scope of the request, Intermediary
will need additional time to provide the requested information,
Intermediary shall promptly notify Fund. If requested by the Fund
or its designee, Intermediary agrees to use best efforts to
determine promptly whether any specific person about whom
Intermediary has received the identification and transaction
information specified in Section 1.1 above is itself a financial
intermediary ("indirect intermediary") and, upon further request
of the Fund or its designee, promptly either: (i) provide (or
arrange to have provided) the information set forth in Section
1.1 for those shareholders who hold an account with an indirect
intermediary; or (ii) restrict or prohibit the indirect
intermediary from purchasing, in nominee name on behalf of other
persons, securities issued by the Fund. Intermediary additionally
agrees to inform the Fund or its designee whether Intermediary
plans to perform (i) or (ii); and
(B) Responses required by this Section 1.1 must be communicated in
writing and in a format mutually agreed upon by the Fund or its
designee and Intermediary; and
(C) To the extent practicable and agreed by the parties, the format
for any transaction information provided to the Fund or its
designee should be consistent with the NSCC Standardized Data
Reporting Format.
1.1.3 LIMITATIONS ON USE OF INFORMATION. Unless the Intermediary
provides prior written consent, Fund agrees not to use the information
received pursuant to this Agreement for any purpose other than as necessary
to comply with the provisions of Rule 22c-2 or to fulfill other regulatory
or legal requirements subject to the privacy provisions of Title V of the
Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102) and comparable state laws.
(a) Fund acknowledges that (i) the purpose for providing
intermediary's customer information to Fund is to better enable
Fund to monitor for
2
violations of the Fund's Market Timing Policies by Intermediary's
customers, and (ii) Fund is responsible for determining when Fund
needs Intermediary's assistance in monitoring and enforcing
Fund's market timing policies through a request for customer
information.
(b) Notwithstanding anything herein to the contrary, to the extent
Fund receives customer information or any other Confidential
Information (as defined below, and together with the customer
information hereinafter referred to as the "Data"), Fund
covenants, represents and warrants either that: (i) Fund shall
not use any Data except to the extent necessary to carry out the
purpose of this Agreement and for no other purpose (including,
without limitation, any marketing, sales or other promotional
efforts by any of Fund) or; (ii) Fund shall not disclose any Data
to any third party, including, without limitation, third party
service providers without Intermediary's prior written consent
and an agreement in writing from the third party to use or
disclose such Data only to the extent necessary to carry out the
purpose of this Agreement and for no other purposes; (iii) Fund
shall maintain, and shall require all third parties approved
under clause (ii) to maintain, effective information security
measures to protect the Data from unauthorized disclosure or use;
and (iv) Fund shall provide Intermediary with information
regarding such security measures upon Intermediary's reasonable
request and promptly provide Intermediary with information
regarding any failure of such security measures or any security
breach related to the Data of which Fund is aware. For the
purposes of this Agreement, "Confidential Information" means the
nonpublic personal information (as defined in 15 U.S.C. Section
6809(4)) of Intermediary (and/or Intermediary's parent,
affiliated or subsidiary companies) of customers or prospective
customers received by Fund under the terms of this Agreement
including, but not limited to: (a) an individual's name, address,
e-mail address, IP address, social security number, and/or
telephone number; (b) the fact that an individual has a
relationship with Intermediary and/or Intermediary's parent,
affiliated or subsidiary companies; or (c) an individual's other
account information.
(c) Fund explicitly acknowledges that all of the Data is
Intermediary's exclusive property and shall remain so
notwithstanding any release thereof in accordance with the terms
of this Agreement.
(d) Fund shall safeguard and preserve as confidential and not use,
except as expressly provided herein, any or all information other
than the Data provided pursuant to, or in connection with, this
Agreement to Fund, including, but not limited to, Intermediary's
affiliate's branch office names and identification numbers,
Xxxxxxx Xxxxx Financial Advisor names, as well as Intermediary's
affiliate's, parent's or subsidiary's systems, business, plans
and operations, which information collectively
3
shall include any such information that is orally disclosed to
Fund or Fund's Designee, or learned by Fund or Fund's Designee
while on Intermediary's premises or derived as a result of, or in
connection with, this Agreement and its subject matter or any
other agreement between Intermediary and Fund associated with the
distribution of or services with respect to the Funds.
(e) Except as expressly provided for herein, Fund will not, without
first obtaining Intermediary's prior written consent, disclose to
any person, firm or enterprise, or use for Fund's benefit, any
Data. Fund shall limit Fund's disclosure of the Data to as few
persons as possible and only to those persons with a need to know
that are Fund's employees or independent contractors engaged by
Fund. Fund shall take all steps necessary to prevent disclosure
of any Data in a manner consistent with Fund's obligations under
this Agreement. Fund shall have no obligation with respect to
particular information to the extent, but only to the extent,
that such information: (i) is already rightfully known to Fund at
the time it is obtained from Intermediary, free from any
obligation to keep such information confidential, as demonstrated
by competent evidence; (ii) is or becomes publicly known through
no wrongful act of Fund or without breach of any terms and
conditions of this Agreement; (iii) is rightfully received from a
third party without restriction and without breach of any terms
and conditions of this Agreement, as demonstrated by competent
evidence; or (iv) is required to be disclosed by law, regulation,
or customer order (provided that Fund shall promptly notify
Intermediary of any such use or requirement prior to disclosure
in order to afford such Intermediary an opportunity to seek a
protective order to prevent or limit public disclosure of the
information).
(f) Upon Intermediary's request, Fund shall promptly return the Data
(and any copies, extracts, and summaries thereof) to
Intermediary, or, with Intermediary's written consent, shall
promptly destroy, in a manner satisfactory to Intermediary, such
materials (and any copies, extracts, and summaries thereof) and
shall further provide Intermediary with written confirmation of
same.
2. RESTRICTION OF TRADING
2.1 AGREEMENT TO RESTRICT TRADING. Intermediary agrees to execute written
instructions from the Fund or its designee to restrict or prohibit further
purchases or exchanges of Shares by a Shareholder that has been identified by
the Fund or its designee as having engaged in transactions of the Fund's Shares
(directly or indirectly through the Intermediary's account) that violate
policies established by the Fund or its designee for the purpose of eliminating
or reducing any dilution of the value of the outstanding Shares issued by the
Fund. Unless otherwise directed by the Fund or its designee, any such
restrictions or
4
prohibitions shall only apply to Shareholder-Initiated Transfer Purchases or
Shareholder-Initiated Transfer Redemptions that are effected directly or
indirectly through Intermediary. Instructions shall in writing and sent to
Intermediary at email address xxxxxxxxxxx@xxx.xx.xxx or facsimile at
000-000-0000. Other notices under this Agreement shall be sent to Intermediary
at:
Xxxxxxx Xxxxx Insurance Group Services, Inc.
Attention: Service Center Controller
0000 Xxxx Xxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
with a copy to:
Financial Data Services, Inc.
Attention: President
0000 Xxxx Xxxx Xxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
2.1.1 FORM OF INSTRUCTIONS. Instructions must include the TIN, ITIN,
or GII and the specific individual Contract owner number or participant
account number associated with the Shareholder, if known, and the specific
restriction(s) to be executed, including how long the restriction(s)
is(are) to remain in place. If the TIN, ITIN, GII or the specific
individual Contract owner number or participant account number associated
with the Shareholder is not known, the instructions must include an
equivalent identifying number of the Shareholder(s) or account(s) or other
agreed upon information to which the instruction relates.
2.1.2 TIMING OF RESPONSE. Intermediary agrees to execute instructions
as soon as reasonably practicable, but not later than five business days
after Intermediary receives the instructions.
2.1.3 CONFIRMATION BY INTERMEDIARY. Intermediary must provide written
confirmation to the Fund or its designee that instructions have been
executed. Intermediary agrees to provide confirmation as soon as reasonably
practicable, but not later than ten business days after the instructions
have been executed.
2.2 CONSTRUCTION OF THE AGREEMENT; PARTICIPATION AGREEMENTS. The parties
have entered into one or more agreements between or among them governing the
purchase and redemption of shares of the Funds in connection with the Contracts
(collectively, "Participation Agreements"). This Agreement supplements those
Participation Agreements. To the extent the terms of this Agreement conflict
with the terms of a Participation Agreement with regard to the requirements of
Rule 22c-2, the terms of this Agreement shall control.
3. MISCELLANEOUS PROVISIONS
3.1 REQUESTS PRIOR TO APRIL 16, 2007. Intermediary shall be able to
promptly respond to requests for Shareholder information by no later than
October 16, 2007.
5
Information requests prior to April 16, 2007, shall be governed by whatever
practices, if any, that Fund and Intermediary have previously utilized to govern
such requests.
3.2 TERMINATION. This Agreement will terminate upon the termination of the
Participation Agreements and redemption of all shares in the Fund held by the
Intermediary, except as specifically provided for in Section 3.6.
3.3 INDEMNIFICATION. Distributors agrees to indemnify and hold Intermediary
harmless from any and all liability, claim, loss, demand, damages, costs and
expenses (including reasonable attorneys' fees) arising in connection with a
third party claim or action brought against Intermediary as a result of any
unauthorized disclosure of a shareholder's taxpayer identification number
provided to the Fund or its designee in response to a request for information
pursuant to the terms of this Agreement ("Losses"). Distributors shall not be
liable for Losses unless the Intermediary has provided adequate written notice
to Distributors promptly after the summons or other first legal process. In
addition, Distributors will be entitled to participate in, at its own expense,
or shall be entitled to assume the defense thereof, consistent with the terms of
the Participation Agreement.
3.4 FORCE MAJEURE. The parties to this Agreement are excused from
performance and shall not be liable for any delay in performance or
non-performance, in whole or in part, caused by the occurrence of any event or
contingency beyond the control of the parties including, but not limited to,
work stoppages, fires, civil disobedience, riots, rebellions, natural disasters,
acts of God, and acts of war or terrorism. Each party so affected shall promptly
give written notice to the other parties and shall use its best efforts to
resume performance. Upon receipt of such notice, all obligations under this
Agreement shall be immediately suspended for the duration of such force majeure
event.
3.5 REMEDIES. The parties to this Agreement acknowledge that in the event
of a breach or threatened breach of this Agreement, any party may have no
adequate remedy at law, and, accordingly, shall be entitled to obtain an
injunction against such breach. However, no specification in this Agreement of a
specific legal or equitable remedy shall be construed as a waiver of or a
prohibition against any other legal or equitable remedies in the event of a
breach of a provision of this Agreement. Each party to this Agreement shall be
entitled to legal damages and/or equitable relief from any other party to this
Agreement for any breach of this Agreement by such other party.
4. DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings, unless a different meaning is clearly required by the context:
The term "INTERMEDIARY" means: (i) the insurance company separate accounts
listed on Attachment A of this Agreement (which is a part of this
Agreement) as well as those identified in Schedule B of the Participation
Agreement(s) to which Distributors and Intermediary are parties, as such
Participation Agreement(s) may be amended
6
from time to time; and (ii) the life insurance company depositor of such
separate accounts.
The term "FUND" shall mean each series of Franklin Xxxxxxxxx Variable
Insurance Products Trust in which Intermediary invests and includes: (i) an
administrator for the Fund; (ii) the principal underwriter or distributor
for the Fund; and (iii) the transfer agent for the Fund. The term does not
include any "excepted funds" as defined in Rule 22c-2(b) under the 0000
Xxx.
The term "SHARES" means the interests of Shareholders corresponding to the
redeemable securities of record issued by a Fund under the 1940 Act that
are held by Intermediary.
The term "SHAREHOLDER" means the holder of interests in a variable annuity
or variable life insurance contract issued by Intermediary ("Contract"), or
a participant in an employee benefit plan with a beneficial interest in a
Contract.
The term "SHAREHOLDER-INITIATED TRANSFER PURCHASE" means a transaction that
is initiated or directed by a Shareholder that results in a transfer of
assets within a Contract to a Fund, but does not include transactions that
are executed: (i) automatically pursuant to a contractual or systematic
program or enrollment such as transfer of assets within a Contract to a
Fund as a result of "dollar cost averaging" programs, insurance company
approved asset allocation programs, or automatic rebalancing programs; (ii)
pursuant to a Contract death benefit; (iii) as part of a one-time step-up
in Contract value pursuant to a Contract death benefit; (iv) as part of an
allocation of assets to a Fund through a Contract as a result of payments
such as loan repayments, scheduled contributions, retirement plan salary
reduction contributions, or planned premium payments to the Contract; or
(v) as pre-arranged transfers at the conclusion of a required free look
period.
The term "SHAREHOLDER-INITIATED TRANSFER REDEMPTION" means a transaction
that is initiated or directed by a Shareholder that results in a transfer
of assets within a Contract out of a Fund, but does not include
transactions that are executed: (i) automatically pursuant to a contractual
or systematic program or enrollments such as transfers of assets within a
Contract out of a Fund as a result of annuity payouts, loans, systematic
withdrawal programs, insurance company approved asset allocation programs
and automatic rebalancing programs; (ii) as a result of any deduction of
charges or fees under a Contract; (iii) within a Contract out of a Fund as
a result of scheduled withdrawals or surrenders from a Contract; or (iv) as
a result of payment of a death benefit from a Contract.
The term "WRITTEN" includes electronic writings.
7
IN WITNESS WHEREOF, each party has caused a duly authorized officer or
representative to execute this Agreement.
FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx Xxxxxx
------------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
XXXXXXX XXXXX LIFE INSURANCE COMPANY
on behalf of itself and the Separate
Accounts referenced in this Agreement
and its Attachment
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
8
ATTACHMENT A TO SHAREHOLDER INFORMATION AGREEMENT
Name of Insurance Company:
Xxxxxxx Xxxxx Life Insurance Company
Name of Separate Account(s):
Xxxxxxx Xxxxx Life Variable Annuity Separate Account A
9
