FIDELITY VARIABLE INSURANCE PRODUCT FUNDS
SHAREHOLDER INFORMATION AGREEMENT
SHAREHOLDER INFORMATION AGREEMENT dated April 12, 2007 ("Effective Date") by and
between Fidelity Distributors Corporation, ("Underwriter") on behalf of Fidelity
Variable Insurance Product Funds I, II, III, and IV, ("Fund") and Phoenix Life
Insurance Company, as agent for Valley Forge Life Insurance Company
("Intermediary").
WHEREAS, the Intermediary is a manufacturer of variable life and variable
annuity insurance products;
WHEREAS, the Intermediary and the Fund previously entered into Participation
Agreements allowing the Intermediary to offer certain Fidelity insurance
dedicated mutual funds through its Separate Accounts by way of the
Intermediary's variable life and variable annuity insurance products;
WHEREAS, Rule 22c-2 of the Investment company Act of 1940, as amended, ("Act")
requires every mutual fund company or its principal underwriter to enter into
written agreements with financial intermediaries obligating each financial
intermediary to provide certain shareholder information as defined by Rule 22c-2
("Rule") of the Act. The Rule also obligates the financial intermediary to
execute instructions from the fund company should the fund company determine
that a shareholder's trading activity violates the fund's short-term trading
policies;
WHEREAS, the Fund is a fund as defined by the Rule;
WHEREAS, the Intermediary is an intermediary as defined by the Rule;
WHEREAS, the Fund and the Intermediary enter into this Shareholder Information
Agreement ("Agreement") to comply with the requirements of the Rule;
NOW, in consideration of the mutual covenants contained in this Agreement, the
parties intend to be legally bound and agree to the following:
I. DEFINITIONS
1.1 - Intermediary: The term "Intermediary" means an insurance company separate
account offering any of the Fund's insurance dedicated mutual funds ("Separate
Account") and/or the insurance company acting as the depositor for the Separate
Account.
1.2 - Fund: The term "Fund" shall mean an open-ended management investment
company that is registered or required to register under Section 8 of the Act.
The term "Fund" includes (i) an investment adviser to or administrator for the
Fund; (ii) the principal underwriter or distributor for the Fund. The term not
does include any "excepted funds" as defined in Rule 22c-2(b) under the Act.
1.3 - Shares: The term "Shares" means the interests of Shareholders
corresponding to the redeemable securities of record issued by the Fund under
the Act that are held by the Intermediary.
1.4-Shareholder: The term "Shareholder" means the holder of interests in a
variable annuity or variable life insurance contract issued contract by the
Intermediary ("Contract"), or a participant in an employee benefit plan with a
beneficial interest in a contract.
1.5-Shareholder -Initiated Transfer Purchase: 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) one-time step-up in
Contract value pursuant to a Contract death benefit; (iv) 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) prearranged transfers at the
conclusion of a required free look period.
1.6-Shareholder Initiated Transfer Redemption: 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.
1.7-Shareholder Information: The term "Shareholder Information" shall have the
meaning set forth in Section 2.1(i), 2.1(ii), and 2.1(iii) below.
1.8-Written or In Writing: The term "written", "in writing" or similar term
includes electronic writings and facsimile transmissions unless otherwise
specified.
II. INFORMATION SHARING
2.1 Information Sharing - Intermediary agrees to provide the Fund, upon written
request, the following Shareholder Information:
(i) the taxpayer identification number ("TIN");
(ii) the Contract owner number or participant account number associated with the
Shareholder;
(iii) the amount, date and transaction type of every purchase, redemption,
transfer, or exchange of Shares held through an account maintained by the
Intermediary during the period covered by the request.
(iv) Upon further request by the Fund or its designee, the Company agrees to
provide the name or other identifier of any investment professionals (if
known) associated with any Contract Owner(s) account which has been
identified by the Fund as having violated 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.
2.2 Period Covered by Request - Requests must set forth a specific period, not
to exceed 90 days from the date of the request, for which Shareholder
Information is sought. The Fund may request Shareholder Information older than
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.
2.3 Timing of Requests - Fund requests for Shareholder Information shall be made
no more frequently than monthly except as the Fund 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.
2.4 Form and Timing of Response - Intermediary agrees to provide Shareholder
Information to the Fund promptly, but in any event no later than ten business
days after receipt of a request. If the Fund requests, the Intermediary agrees
to use its best efforts to promptly determine whether any specific person about
whom it has received Shareholder Information is itself a financial intermediary
("indirect intermediary"). (a) The Intermediary further agrees that if the Fund
requests, the Intermediary will, with notice to the Fund, promptly either: (i)
provide or arrange to provide Shareholder Information for those shareholders who
hold an account with an indirect intermediary; or (ii) if directed by the Fund
or its designee, prohibit the indirect intermediary from purchasing, in nominee
name on behalf of other persons, securities issued by the Fund.
The Company additionally agrees to inform the Fund whether it plans to perform
(i) or (ii).
(b) Responses required by this paragraph must be communicated in writing and in
a format mutually agreed upon by the Fund or its designee and the Intermediary;
and according to the IRS' website, the ITIN refers to the Individual Taxpayer
Identification number, which is a nine-digit number that always begins with the
number 9 and has a 7 or 8 in the fourth digit, example 9XX-7X-XXXX. The IRS
issues ITINs to individuals who are required to have a U.S. taxpayer
identification number but who do not have, and are not eligible to obtain a
Social Security Number (SSN) from the Social Security Administration (SSA). SEC
Rule 22c-2 inadvertently refers to the ITIN as the International Taxpayer
Identification Number.
(c) To the extent practicable, the format for any Shareholder Information
provided to the Fund should be consistent with the NSCC Standardized Data
Reporting Format.
2.5 Limitations on Use of Shareholder Information- The Fund agrees to only use
the Shareholder Information for the purposes of identifying Shareholders who may
be violating the Funds policies and procedures with respect to dilution of the
Fund's value as contemplated by the Rule 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. The Fund
agrees that the Shareholder Information is confidential and that the Fund will
not share the Shareholder Information externally, unless the Intermediary
provides the Fund with prior written consent to share such Shareholder
Information. If a party to this Agreement becomes aware of any disclosure to an
unauthorized third party of any non-public personal financial information of a
consumer provided or received by Underwriter in response to a request for
information pursuant to the terms of this Agreement, such party promptly shall,
at its expense: (i) notify the other party; (ii) investigate the circumstances
relating to such actual or suspected unauthorized access, use or disclosure;
(iii) take commercially reasonable steps to mitigate the effects of such
unauthorized access, use or disclosure and to prevent any reoccurrence; (iv)
provide to the other such information regarding such unauthorized access, use or
disclosure as is reasonably required for the other party to evaluate the likely
consequences and any regulatory or legal requirements arising out of such
unauthorized access, use or disclosure; and (v) cooperate with the other party
to further comply with all relevant laws, rules and regulations.
III. PROHIBITIONS ON TRADING
3.1 Agreement to Prohibit Trading. Intermediary agrees to execute written
instructions from the Fund to prohibit further purchases or exchanges of Shares
by a Shareholder that has been identified by the Fund 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 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, any such
prohibitions shall only apply to Shareholder-Initiated Transfer Purchases or
Shareholder-Initiated Transfer Redemptions that are effected directly or
indirectly through Intermediary. Instructions must be received by us at a
mutually agreed upon address.
3.2 Form of Instructions. Instructions must include the TIN and the specific
individual Contract owner number or participant account number associated with
the Shareholder, if known, and the specific instruction(s) to be executed,
including how long the prohibition(s) is(are) to remain in place. If the TIN 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. Upon request of the
Intermediary, Fund agrees to provide to the Intermediary, along with any written
instructions to prohibit further purchases or exchanges of Shares by
Shareholder, information regarding those trades of the contract holder that
violated the Fund's policies.
3.3 Timing of Response. Intermediary agrees to execute instructions as soon as
reasonably practicable, but not later than five business days after receipt of
the instructions by the Intermediary.
3.4 Confirmation by Intermediary. Intermediary must provide written confirmation
to the Fund 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.
3.5 Redemption Fees. The Company shall not purchase or redeem Fund shares that
are subject to redemption fees, including shares of Portfolios or share classes
that later become subject to redemption fees, in the absence of an additional
written agreement signed by all parties to the participation agreement.
IV. GENERAL PROVISIONS
4.1 Construction of the Agreement; Fund Participation Agreements. The parties
have entered into one or more Fund Participation Agreements between or among
them for the purchase and redemption of shares of the Funds by the Accounts in
connection with the Contracts. The Fund Participation Agreements are hereby
incorporated by reference into this Agreement, as this Agreement is intended to
be a supplement to the Fund Participation Agreements. To the extent the terms of
this Agreement conflict with the terms of a Fund Participation Agreement, the
terms of this Agreement shall control.
4.2 Indemnification. The Fund agrees to indemnify and hold harmless Intermediary
from any and all liability, claim, loss, demand, damages, costs and expenses
(including reasonable attorney's fees) arising in connection with 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 in response to a request for Shareholder Information pursuant to the terms
of this Agreement.
4.4 Termination. This Agreement will terminate upon the termination of the
applicable Fund Participation Agreements.
IN WITNESS WHEREOF, the below persons, as duly authorized officers, have caused
this Agreement to be executed on behalf of the parties as of the Effective Date.
Fidelity Distributors Corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
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Title: Executive Vice President
Date: April 16, 2007
Phoenix Life Insurance Company, as agent for Valley Forge Life Insurance Company
By:/s/ Xxxx Xxxxxxx X'Xxxxxxx
Name: Xxxx Xxxxxxx X'Xxxxxxx
Title: SR Vice President
Date: April 3, 2007
