PARTICIPATION AGREEMENT -- HARTFORD LEADERS
as of May 1, 2000
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
Hartford Securities Distribution Company, Inc.
CONTENTS
SECTION SUBJECT MATTER
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1. Parties and Purpose
2. Representations and Warranties
3. Purchase and Redemption of Trust Portfolio Shares
4. Fees, Expenses, Prospectuses, Proxy Materials and Reports
5. Voting
6. Sales Material, Information and Trademarks
7. Indemnification
8. Notices
9. Termination
10. Miscellaneous
SCHEDULES TO THIS AGREEMENT
A. The Company
B. Accounts of the Company
C. Available Portfolios and Classes of Shares of the Trust; Investment
Advisers
D. Contracts of the Company
E. This schedule not used.
F. Rule 12b-1 Plans of the Trust
G. Addresses for Notices
H. Shared Funding Order
1. PARTIES AND PURPOSE
This agreement (the "Agreement") is between certain portfolios, specified below
and in Schedule C, of Franklin Xxxxxxxxx Variable Insurance Products Trust, an
open-end management investment company organized as a business trust under
Massachusetts law (the "Trust"), Franklin Xxxxxxxxx Distributors, Inc., a
California corporation which is the principal underwriter for the Trust (the
"Underwriter," and together with the Trust, "we" or "us") and each insurance
company identified on Schedule A ("you"), and your distributor, on your own
behalf and on behalf of each
segregated asset account maintained by you that is listed on Schedule B, as that
schedule may be amended from time to time ("Account" or "Accounts").
This Agreement shall create a separate agreement for each insurance company
identified on Schedule A of this Agreement ("Company") as though each Company
had separately executed an identical
participation agreement with the Trust and
the Underwriter. No rights, responsibilities or liabilities arising under the
Agreement as it pertains to one Company shall be enforceable by or against any
party to the Agreement as it pertains to another Company.
The purpose of this Agreement is to entitle you, on behalf of the Accounts, to
purchase the shares, and classes of shares, of portfolios of the Trust
("Portfolios") that are identified on Schedule C, solely for the purpose of
funding benefits of your variable life insurance policies or variable annuity
contracts ("Contracts") that are identified on Schedule D. This Agreement does
not authorize any other purchases or redemptions of shares of the Trust.
2. REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES BY YOU
You represent and warrant that:
2.1.1 You are an insurance company duly organized and in good
standing under the laws of your state of incorporation.
2.1.2 All of your directors, officers, employees, and other
individuals or entities dealing with the money and/or securities of
the Trust are and shall be at all times covered by a blanket fidelity
bond or similar coverage for the benefit of the Trust, in an amount
not less than $5 million. Such bond shall include coverage for larceny
and embezzlement and shall be issued by a reputable bonding company.
You agree to make all reasonable efforts to see that this bond or
another bond containing such provisions is always in effect, and you
agree to notify us in the event that such coverage no longer applies.
2.1.3 Each Account is a duly organized, validly existing segregated
asset account under applicable insurance law and interests in each
Account are offered exclusively through the purchase of or transfer
into a "variable contract" within the meaning of such terms under
Section 817 of the Internal Revenue Code of 1986, as amended ("Code")
and the regulations thereunder. You will use your best efforts to
continue to meet such definitional requirements, and will notify us
immediately upon having a reasonable basis for believing that such
requirements have ceased to be met or that they might not be met in
the future.
2.1.4 Each Account either: (i) has been registered or, prior to any
issuance or sale of the Contracts, will be registered as a unit
investment trust under the Investment Company Act of 1940 ("1940
Act"); or (ii) has not been so registered in proper reliance upon an
exemption from registration under Section 3(c) of the 1940 Act; if the
Account is exempt from registration as an investment company under
Section 3(c) of the 1940 Act, you will use your best efforts to
maintain
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such exemption and will notify us immediately upon having a reasonable
basis for believing that such exemption no longer applies or might not
apply in the future.
2.1.5 The Contracts or interests in the Accounts: (i) are or, prior
to any issuance or sale will be, registered as securities under the
Securities Act of 1933, as amended (the "1933 Act"); or (ii) are not
registered because they are properly exempt from registration under
Section 3(a)(2) of the 1933 Act or will be offered exclusively in
transactions that are properly exempt from registration under Section
4(2) or Regulation D of the 1933 Act, in which case you will make
every effort to maintain such exemption and will notify us immediately
upon having a reasonable basis for believing that such exemption no
longer applies or might not apply in the future.
2.1.6 The Contracts: (i) will be sold by broker-dealers, or their
registered representatives, who are registered with the Securities and
Exchange Commission ("SEC") under the Securities and Exchange Act of
1934, as amended (the "1934 Act") and who are members ("Members") in
good standing of the National Association of Securities Dealers, Inc.
(the "NASD"); and (ii) will be issued and sold in compliance in all
material respects with all applicable federal and state laws. You have
entered, or will enter into, and will maintain a selling agreement
with each Member through which you intend to distribute the Contracts,
and such selling agreement will provide that each Member will comply
with all applicable federal and state laws, rules and regulations.
2.1.7 Subject to the representations and warranties by the Trust and
the Underwriter at Section 2.2.7 of this Agreement concerning the
qualification of the Trust as a "regulated investment company" under
Sub-Chapter M of the Code and also subject to the representations and
warranties of the Trust and the Underwriter at Section 2.2.8 of this
Agreement concerning the Trust's compliance with the diversification
requirements under Section 817(h) of the Code, the Contracts currently
are and will be treated as annuity contracts or life insurance
contracts under applicable provisions of the Code and you will use
your best efforts to maintain such treatment; you will notify us
immediately upon having a reasonable basis for believing that any of
the Contracts have ceased to be so treated or that they might not be
so treated in the future.
2.1.8 The fees and charges deducted under each Contract, in the
aggregate, are reasonable in relation to the services rendered, the
expenses expected to be incurred, and the risks assumed by you.
2.1.9 You will use shares of the Trust only for the purpose of
funding benefits of the Contracts through the Accounts.
2.1.10 Contracts will not be issued for sale outside of the United
States.
2.1.11 All Accounts shall be registered as investment companies
pursuant to the 1940 Act, unless exempt from such registration.
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2.2 REPRESENTATIONS AND WARRANTIES BY THE TRUST
The Trust represents and warrants that:
2.2.1 It is duly organized and in good standing under the laws of the
State of Massachusetts.
2.2.2 All of its directors, officers, employees and others dealing
with the money and/or securities of a Portfolio are and shall be at
all times covered by a blanket fidelity bond or similar coverage for
the benefit of the Trust in an amount not less that the minimum
coverage required by Rule 17g-1 or other regulations under the 1940
Act. Such bond shall include coverage for larceny and embezzlement and
be issued by a reputable bonding company.
2.2.3 It is registered as an open-end management investment company
under the 0000 Xxx.
2.2.4 Each class of shares of the Portfolios of the Trust is
registered under the 0000 Xxx.
2.2.5 It will amend its registration statement under the 1933 Act and
the 1940 Act from time to time as required in order to effect the
continuous offering of its shares.
2.2.6 It will comply, in all material respects, with the 1933 and
1940 Acts and the rules and regulations thereunder.
2.2.7 Subject to your representations and warranties at Section 2.1.7
of this Agreement concerning the qualification of the Contracts as
annuity contracts or life insurance contracts under applicable
provisions of the Code, the Trust is currently qualified as a
"regulated investment company" under Subchapter M of the Code, it will
make every effort to maintain such qualification, and will notify you
immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
2.2.8 The Trust will use its best efforts to comply with the
diversification requirement for variable annuity, endowment or life
insurance contracts set forth in Section 817(h) of the Code, and the
rules and regulations thereunder, including without limitation
Treasury Regulation 1.817-5. Upon having a reasonable basis for
believing any Portfolio has ceased to comply and will not be able to
comply within the grace period afforded by Regulation 1.817-5, the
Trust will notify you immediately and will take all reasonable steps
to adequately diversify the Portfolio to achieve compliance.
2.2.9 It currently intends for one or more classes of shares (each, a
"Class") to make payments to finance its distribution expenses,
including service fees, pursuant to a plan ("Plan") adopted under rule
12b-1 under the 1940 Act ("Rule 12b-1"), although it may determine to
discontinue such practice in the future. To the extent that any Class
of the Trust finances its distribution expenses pursuant to a Plan
adopted under rule 12b-1, the Trust undertakes to comply with any then
current SEC interpretations concerning rule 12b-1 or any successor
provisions.
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2.3 REPRESENTATIONS AND WARRANTIES BY THE UNDERWRITER
The Underwriter represents and warrants that:
2.3.1 It is registered as a broker dealer with the SEC under the 1934
Act, and is a member in good standing of the NASD.
2.3.2 Each investment adviser listed on Schedule C (each, an
"Adviser") is duly registered as an investment adviser under the
Investment Advisers Act of 1940, as amended, and any applicable state
securities law.
2.4 WARRANTIES AND AGREEMENTS BY BOTH YOU AND US
2.4.1 We received an order from the SEC dated November 16, 1993 (file
no. 812-8546), which was amended by a notice and an order we received
on September 17, 1999 and October 13, 1999, respectively (file no.
812-11698) (collectively, the "Shared Funding Order," attached to this
Agreement as Schedule H). The Shared Funding Order grants exemptions
from certain provisions of the 1940 Act and the regulations thereunder
to the extent necessary to permit shares of the Trust to be sold to
and held by variable annuity and variable life insurance separate
accounts of both affiliated and unaffiliated life insurance companies
and qualified pension and retirement plans outside the separate
account context. You and we both warrant and agree that both you and
we will comply with the "Applicants' Conditions" prescribed in the
Shared Funding Order as though such conditions were set forth verbatim
in this Agreement, including, without limitation, the provisions
regarding potential conflicts of interest between the separate
accounts which invest in the Trust and regarding contract owner voting
privileges. In order for the Trust's Board of Trustees to perform its
duty to monitor for conflicts of interest, you agree to inform us of
the occurrence of any of the events specified in condition 2 of the
Shared Funding Order to the extent that such event may or does result
in a material conflict of interest as defined in that order.
2.4.2 As covered financial institutions we, only with respect to
Portfolio shareholders, and you each undertake and agree to comply,
and to take full responsibility in complying with any and all
applicable laws, regulations, protocols and other requirements
relating to money laundering including, without limitation, the
International Money Laundering Abatement and Anti-Terrorist Financing
Act of 2001 (Title III of the USA PATRIOT Act).
3. PURCHASE AND REDEMPTION OF TRUST PORTFOLIO SHARES
3.1 We will make shares of the Portfolios available to the Accounts for
the benefit of the Contracts. The shares will be available for purchase at
the net asset value per share next computed after we (or our agent) receive
a purchase order, as established in accordance with the provisions of the
then current prospectus of the Trust. Notwithstanding the foregoing, the
Trust's Board of Trustees ("Trustees") may refuse to sell shares of any
Portfolio to any person, or may suspend or terminated offering of shares of
any Portfolio if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the
Trustees, they deem such action to be in the best interests of the
shareholders of such Portfolio. Without limiting the foregoing, the
Trustees have determined that there is a significant risk that the Trust
and its shareholders may be
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adversely affected by investors whose purchase and redemption activity
follows a market timing pattern, and have authorized the Trust, the
Underwriter and the Trust's transfer agent to adopt procedures and take
other action (including, without limitation, rejecting specific purchase
orders) as they deem necessary to reduce, discourage or eliminate market
timing activity. You agree to cooperate with us to assist us in
implementing the Trust's restrictions on purchase and redemption activity
that follows a market timing pattern.
3.2 We agree that shares of the Trust will be sold only to life insurance
companies which have entered into fund
participation agreements with the
Trust ("Participating Insurance Companies") and their separate accounts or
to qualified pension and retirement plans in accordance with the terms of
the Shared Funding Order. No shares of any Portfolio will be sold to the
general public.
3.3 This section not used.
3.4 You shall be the designee for us for receipt of purchase orders and
requests for redemption resulting from investment in and payments under the
Contracts ("Instructions"). The Business Day on which such Instructions are
received in proper form by you and time stamped by the close of trading
will be the date as of which Portfolio shares shall be deemed purchased,
exchanged, or redeemed as a result of such Instructions. Instructions
received in proper form by you and time stamped after the close of trading
on any given Business Day shall be treated as if received on the next
following Business Day. You warrant that all orders, Instructions and
confirmations received by you which will be transmitted to us for
processing on a Business Day will have been received and time stamped prior
to the Close of Trading on that Business Day. Instructions we receive after
9 a.m. Eastern Time (or up to 9:30 a.m. Eastern Time with prior telephone
notification) shall be processed on the next Business Day. "Business Day"
shall mean any day on which the New York Stock Exchange is open for trading
and on which the Trust calculates its net asset value pursuant to the rules
of the SEC and its current prospectus.
3.5 We shall calculate the net asset value per share of each Portfolio on
each Business Day, and shall communicate these net asset values to you or
your designated agent on a daily basis as soon as reasonably practical
after the calculation is completed (normally by 6:30 p.m. Eastern time).
3.6 You shall submit payment for the purchase of shares of a Portfolio on
behalf of an Account in federal funds transmitted by wire to the Trust or
to its designated custodian, which must receive such wires no later than
the close of the Reserve Bank, which is 6:00 p.m. East Coast time, on the
Business Day following the Business Day as of which such purchases orders
are made.
3.7 We will redeem any full or fractional shares of any Portfolio, when
requested by you on behalf of an Account, at the net asset value next
computed after receipt by us (or our agent) of the request for redemption.
The Trust anticipates that in the ordinary course of business it will make
redemptions in cash, however it reserves the right to make redemptions in
kind, in accordance with its prospectus disclosure (including its statement
of additional information). We shall make payment for such shares in the
manner we establish from time to time, but in no event shall payment be
delayed for a greater period than is permitted by the 1940 Act. Redemption
with respect to a
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Portfolio will be made in accordance with the prospectus disclosure
(including its statement of additional information) of the Trust, and will
normally be paid to the Company before the close of the Federal Reserve
Banks, which is 6:00 p.m. Eastern time on the next Business Day after the
receipt of the request for redemption. If payment in federal funds for any
redemption request is received by you after such time, the Trust shall
promptly upon your written request, reimburse you for any charges, costs,
fees, interest, or other expenses reasonably incurred by you as a result of
such failure to provide redemption proceeds within the specified time.
3.8 Issuance and transfer of the Portfolio shares will be by book entry
only. Stock certificates will not be issued to you or the Accounts.
Portfolio shares purchased from the Trust will be recorded in the
appropriate title for each Account or the appropriate subaccount of each
Account.
3.9 We shall furnish, on or before the ex-dividend date, notice to you of
any income dividends or capital gain distributions payable on the shares of
any Portfolio. You hereby elect to receive all such income dividends and
capital gain distributions as are payable on shares of a Portfolio in
additional shares of that Portfolio, and you reserve the right to change
this election in the future. We will notify you of the number of shares so
issued as payment of such dividends and distributions.
3.10 Each party to this Agreement agrees that, in the event of a material
error resulting from incorrect information or confirmations, the parties
will seek to comply in all material respects with the provisions of
applicable federal securities laws.
4. FEES, EXPENSES, PROSPECTUSES, PROXY MATERIALS AND REPORTS
4.1 We shall pay no fee or other compensation to you under this Agreement
except as provided on Schedule F, if attached.
4.2 We shall prepare and be responsible for filing with the SEC, and any
state regulators requiring such filing, all shareholder reports, notices,
proxy materials (or similar materials such as voting instruction
solicitation materials), prospectuses and statements of additional
information of the Trust. We shall bear the costs of preparation and filing
of the documents listed in the preceding sentence, registration and
qualification of the Trust's shares of the Portfolios.
4.3 We shall use reasonable efforts to provide you, on a timely basis,
with such information about the Trust, the Portfolios and each Adviser, in
such form as you may reasonably require, as you shall reasonably request in
connection with the preparation of disclosure documents and annual and
semi-annual reports pertaining to the Contracts.
4.4 At your option, we shall provide you, at our expense, with either, (i)
for each Contract owner who is invested through the Account in a subaccount
corresponding to a Portfolio ("designated subaccount"), one copy of each of
the following documents on each occasion that such document is required by
law or regulation to be delivered to such Contract owner who is invested in
a designated subaccount: the Trust's current prospectus, annual report,
semi-annual report and other shareholder communications, including any
amendments or supplements to any of the foregoing, pertaining specifically
to the Portfolios ("Designated Portfolio Documents"); or (ii) a camera
ready
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copy or such Designated Portfolio Documents in a form suitable for printing
and from which information relating to series of the Trust other than the
Portfolios has been deleted to the extent practicable. In connection with
clause (ii) of this paragraph, we will pay for proportional printing costs
for such Designated Portfolio Documents in order to provide one copy for
each Contract owner who is invested in a designated subaccount on each
occasion that such document is required by law or regulation to be
delivered to such Contract owner, and provided the appropriate
documentation is provided and approved by us. We shall provide you with a
copy of the Trust's current statement of additional information, including
any amendments or supplements, in a form suitable for you to duplicate. The
expenses of furnishing, including mailing, to Contract owners the documents
referred to in this paragraph shall be borne by us. For each of the
documents provided to you in accordance with clause (i) of this paragraph
4.4, we shall provide you, upon your request and at your expense,
additional copies. In no event shall we be responsible for the costs of
printing or delivery of Designated Portfolio Documents to potential or new
Contract owners.
4.5 We shall provide you, at our expense, with copies of any
Trust-sponsored proxy materials in such quantity as you shall reasonably
require for distribution to Contract owners who are invested in a
designated subaccount. We shall bear the costs of distributing
Trust-sponsored proxy materials (or similar materials such as voting
solicitation instructions) to Contract owners.
4.6 You assume sole responsibility for ensuring that the Trust's
prospectuses, shareholder reports and communications, and proxy materials
are delivered to Contract owners in accordance with applicable federal and
state securities laws.
5. VOTING
5.1 All Participating Insurance Companies shall have the obligations and
responsibilities regarding pass-through voting and conflicts of interest
corresponding to those contained in the Shared Funding Order.
5.2 If and to the extent required by law, you shall: (i) solicit voting
instructions from Contract owners; (ii) vote the Trust shares in accordance
with the instructions received from Contract owners; and (iii) vote Trust
shares for which no instructions have been received in the same proportion
as Trust shares of such Portfolio for which instructions have been
received; so long as and to the extent that the SEC continues to interpret
the 1940 Act to require pass-through voting privileges for variable
contract owners. You reserve the right to vote Trust shares held in any
Account in your own right, to the extent permitted by law.
5.3 So long as, and to the extent that, the SEC interprets the 1940 Act to
require pass-through voting privileges for Contract owners, you shall
provide pass-through voting privileges to Contract owners whose Contract
values are invested, through the Accounts, in shares of one or more
Portfolios of the Trust. We shall require all Participating Insurance
Companies to calculate voting privileges in the same manner and you shall
be responsible for assuring that the Accounts calculate voting privileges
in the manner established by us. With respect to each Account, you will
vote shares of each Portfolio of the Trust held by an Account and for which
no timely voting instructions from Contract owners are received in the same
proportion as those shares held by that Account for which voting
instructions are received. You and your agents will in no way recommend or
oppose
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or interfere with the solicitation of proxies for Portfolio shares held to
fund the Contracts without our prior written consent, which consent may be
withheld in our sole discretion.
6. SALES MATERIAL, INFORMATION AND TRADEMARKS
6.1 For purposes of this Section 6, "Sales literature or other Promotional
material" includes, but is not limited to, portions of the following that
use any logo or other trademark related to the Trust, or Underwriter or its
affiliates, or refer to the Trust: advertisements (such as material
published or designed for use in a newspaper, magazine or other periodical,
radio, television, telephone or tape recording, videotape display, signs or
billboards, motion pictures, electronic communication or other public
media), sales literature (i.e., any written communication distributed or
made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts,
reprints or excerpts or any other advertisement, sales literature or
published article or electronic communication), educational or training
materials or other communications distributed or made generally available
to some or all agents or employees in any media, and disclosure documents,
shareholder reports and proxy materials.
6.2 Upon our request, you shall furnish, or cause to be furnished to us or
our designee, all portions or provisions of each registration statement,
prospectus, statement of additional information, private placement
memorandum, retirement plan disclosure information or other disclosure
documents or similar information, as applicable (collectively "Disclosure
Documents") that relate to or discuss the Trust, a Portfolio, the
Underwriter or an Adviser, as well as any report, solicitation for voting
instructions, Sales literature or other Promotional materials, and all
amendments to any of the above that relate to the Contracts or the Accounts
and relate to or discuss the Trust, a Portfolio, the Underwriter or an
Adviser prior to its first use. You shall furnish, or shall cause to be
furnished, to us or our designee each piece of Sales literature or other
Promotional material in which the Trust or an Adviser is named, at least
ten (10) Business Days prior to its proposed use. No such material shall be
used unless we or our designee approve such material and its proposed use.
We shall furnish, or shall cause to be furnished, to you or your designee
each piece of Sales literature or other Promotional material prepared by us
in which you are named, at least ten (10) Business Days prior to its
proposed use, other than a simple list identifying Trust shareholders by
name. No such material shall be used unless you or your designee approve
such material and its proposed use.
6.3 You and your agents shall not give any information or make any
representations or statements on behalf of the Trust or concerning the
Trust, the Underwriter or an Adviser, other than information or
representations contained in and accurately derived from the registration
statement, prospectus or statement of additional information for the Trust
shares (as such registration statement, prospectus and statement of
additional information may be amended or supplemented from time to time),
annual and semi-annual reports of the Trust, Trust-sponsored proxy
statements, or in Sales literature or other Promotional material approved
by the Trust or its designee, except as required by legal process or
regulatory authorities or with the written permission of the Trust or its
designee. You shall send us a complete copy of each Disclosure Document and
item of Sales literature or other Promotional materials in its final form
within twenty (20) days of its first use.
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6.4 We shall not give any information or make any representations or
statements on behalf of you or concerning you, the Accounts or the
Contracts other than information or representations, including naming you
as a Trust shareholder, contained in and accurately derived from Disclosure
Documents for the Contracts (as such Disclosure Documents may be amended or
supplemented from time to time), or in materials approved by you for
distribution, including Sales literature or other Promotional materials,
except as required by legal process or regulatory authorities or with your
written permission.
6.5 Except as provided in Section 6.2, you shall not use any designation
comprised in whole or part of the names or marks "Franklin" or "Xxxxxxxxx"
or any logo or other trademark relating to the Trust or the Underwriter
without prior written consent, and upon termination of this Agreement for
any reason, you shall cease all use of any such name or xxxx as soon as
reasonably practicable.
6.6 You shall furnish to us ten (10) Business Days prior to its first
submission to the SEC or its staff, any request or filing for no-action
assurance or exemptive relief naming, pertaining to, or affecting, the
Trust, the Underwriter or any of the Portfolios.
7. INDEMNIFICATION
7.1 INDEMNIFICATION BY YOU
7.1.1 You agree to indemnify and hold harmless the Underwriter, the
Trust and each of its Trustees, officers, employees and agents and
each person, if any, who controls the Trust within the meaning of
Section 15 of the 1933 Act (collectively, the "Indemnified Parties"
and individually the "Indemnified Party" for purposes of this Section
7.1) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with your written consent, which
consent shall not be unreasonably withheld) or expenses (including the
reasonable costs of investigating or defending any alleged loss,
claim, damage, fine, liability or expense and reasonable legal counsel
fees incurred in connection therewith) (collectively, "Losses"), to
which the Indemnified Parties may become subject under any statute or
regulation, or at common law or otherwise, insofar as such Losses are
related to the sale or acquisition of shares of the Trust or the
Contracts and:
7.1.1.1 arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in a
Disclosure Document for the Contracts or in the Contracts
themselves or in sales literature generated or approved by you on
behalf of the Contacts or Accounts (or any amendment or
supplement to any of the foregoing) (collectively, "Company
Documents" for the purposes of this Section 7), or arise out of
or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, provided
that this indemnity shall not apply as to any Indemnified Party
if such statement or omission or such alleged statement or
omission was made in reliance upon and was accurately derived
from written information furnished to you by or on behalf of the
Trust for use in Company Documents or otherwise for use in
connection with the sale of the Contracts or Trust shares; or
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7.1.1.2 arise out of or result from statements or
representations (other than statements or representations
contained in and accurately derived from Trust Documents as
defined below in Section 7.2) or wrongful conduct of you or
persons under your control, with respect to the sale or
acquisition of the Contracts or Trust shares; or
7.1.1.3 arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Trust
Documents as defined below in Section 7.2 or the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement or the
statements therein not misleading if such statement or omission
was made in reliance upon and accurately derived from written
information furnished to the Trust by or on behalf of you; or
7.1.1.4 arise out of or result from any failure by you to
provide the services or furnish the materials required under the
terms of this Agreement;
7.1.1.5 arise out of or result from any material breach of any
representation and/or warranty made by you in this Agreement or
arise out of or result from any other material breach of this
Agreement by you; or
7.1.1.6 arise out of or result from a Contract failing to be
considered a life insurance policy or an annuity Contract,
whichever is appropriate, under applicable provisions of the Code
thereby depriving the Trust of its compliance with Section 817(h)
of the Code, unless such Contract's failure was caused by the
Trust's failure to comply with Subchapter M or Section 817(h) of
the Code;
as limited by and in accordance with the provisions of Sections 7.1.2 and 7.1.3
hereof.
7.1.2 You shall not be liable under this indemnification provision
with respect to any Losses to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's
reckless disregard of obligations and duties under this Agreement or
to the Trust or Underwriter, whichever is applicable.
7.1.3 You shall also not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified you in writing
within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been
served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent),
but failure to notify you of any such claim shall not relieve you from
any liability which it may have to the Indemnified Party against whom
such action is brought otherwise than on account of this
indemnification provision. In case any such action is brought against
the Indemnified Parties, you shall be entitled to participate, at your
own expense, in the defense of such action. Unless the Indemnified
Party releases you from any further obligations under this Section
7.1, you also shall be entitled to assume the defense thereof, with
counsel satisfactory to the party named in the action. After notice
from you to such party of your election to assume the defense thereof,
the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and you will not be
11
liable to such party under this Agreement for any legal or other
expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
7.1.4 The Indemnified Parties will promptly notify you of the
commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
7.2 INDEMNIFICATION BY THE UNDERWRITER
7.2.1 The Underwriter agrees to indemnify and hold harmless you, and
each of your directors and officers and each person, if any, who
controls you within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" and individually an
"Indemnified Party" for purposes of this Section 7.2) against any and
all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Underwriter, which consent
shall not be unreasonably withhold) or expenses (including the
reasonable costs of investigating or defending any alleged loss,
claim, damage, liability or expense and reasonable legal counsel fees
incurred in connection therewith) (collectively, "Losses") to which
the Indemnified Parties may become subject under any statute, or
regulation, or at common law or otherwise, insofar as such Losses are
related to the sale or acquisition of the shares of the Trust or the
Contracts and:
7.2.1.1 arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statement, prospectus or sales literature of the
Trust (or any amendment or supplement to any of the foregoing)
(collectively, the "Trust Documents") or arise out of or are
based upon the omission or the alleged omission to state therein
a material fact required to be stated therein or necessary to
make the statements therein not misleading, provided that this
indemnity shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission was
made in reliance upon and was accurately derived from written
information furnished to us by or on behalf of you for use in
Trust Documents or otherwise for use in connection with the sale
of the Contracts or Trust shares; or
7.2.1.2 arise out of result from statements or representations
(other than statements or representations contained in and
accurately derived from Company Documents not supplied by the
Underwriter or persons under its control) or wrongful conduct of
the Trust, Adviser or Underwriter or persons under their control,
with respect to the sale or distribution of the Contracts or
Trust shares; or
7.2.1.3 arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Company
Documents, or any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement
or statements therein not misleading, if such statement or
omission was made in reliance upon information furnished to you
by or on behalf of the Trust; or
12
7.2.1.4 arise as a result of any failure by us to provide the
services and furnish the materials under the terms of this
Agreement (including a failure, whether unintentional or in good
faith or otherwise, to comply with the qualification
representation specified above in Section 2.2.7 and the
diversification requirements specified above in Section 2.2.8);
or
7.2.1.5 arise out of or result from any material breach of any
representation and/or warranty made by the Underwriter in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Underwriter; as limited by and in
accordance with the provisions of Sections 7.2.2 and 7.2.3
hereof.
7.2.2 The Underwriter shall not be liable under this indemnification
provision with respect to any Losses to which an Indemnified Party
would otherwise be subject by reason of such Indemnified Party's
willful misfeasance, bad faith, or gross negligence in the performance
of such Indemnified Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations and duties under this
Agreement or to you or the Accounts, whichever is applicable.
7.2.3 The Underwriter shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified the Underwriter in
writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have
been served upon such Indemnified Party (or after such Indemnified
Party shall have received notice of such service on any designated
agent), but failure to notify the Underwriter of any such claim shall
not relieve the Underwriter from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any such
action is brought against the Indemnified Parties, the Underwriter
will be entitled to participate, at its own expense, in the defense
thereof. Unless the Indemnified Party releases the Underwriter from
any further obligations under this Section 7.2, the Underwriter also
shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action. After notice from the
Underwriter to such party of the Underwriter's election to assume the
defense thereof, the Indemnified Party shall bear the expenses of any
additional counsel retained by it, and the Underwriter will not be
liable to such party under this Agreement for any legal or other
expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
7.2.4 You agree promptly to notify the Underwriter of the
commencement of any litigation or proceedings against you or the
Indemnified Parties in connection with the issuance or sale of the
Contracts or the operation of each Account.
7.3 INDEMNIFICATION BY THE TRUST
7.3.1 The Trust agrees to indemnify and hold harmless you, and each
of your directors and officers and each person, if any, who controls
you within the meaning of Section 15 of the 1933 Act (collectively,
the "Indemnified Parties" for purposes of this Section 7.3) against
any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Trust, which
consent shall not be unreasonably withheld) or litigation (including
legal and other expenses) to which the Indemnified Parties may become
subject under any statute, at
13
common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements
result from the gross negligence, bad faith or willful misconduct of
the Board or any member thereof, are related to the operations of the
Trust, and arise out of or result from any material breach of any
representation and/or warranty made by the Trust in this Agreement or
arise out of or result from any other material breach of this
Agreement by the Trust; as limited by and in accordance with the
provisions of Sections 7.3.2 and 7.3.3 hereof. It is understood and
expressly stipulated that neither the holders of shares of the Trust
nor any Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
7.3.2 The Trust shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation incurred or assessed against any Indemnified Party as such
may arise from such Indemnified Party's willful misfeasance, bad
faith, or gross negligence in the performance of such Indemnified
Party's duties or by reason of such Indemnified Party's reckless
disregard of obligations and duties under this Agreement or to you,
the Trust, the Underwriter or each Account, whichever is applicable.
7.3.3 The Trust shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified the Trust in writing
within a reasonable time after the summons or other first legal
process giving information of the nature of the claims shall have been
served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent),
but failure to notify the Trust of any such claim shall not relieve
the Trust from any liability which it may have to the Indemnified
Party against whom such action is brought otherwise than on account of
this indemnification provision. In case any such action is brought
against the Indemnified Parties, the Trust will be entitled to
participate, at its own expense, in the defense thereof. Unless the
Indemnified Party releases the Trust from any further obligations
under this Section 7.3, the Trust also shall be entitled to assume the
defense thereof, with counsel satisfactory to the party named in the
action. After notice from the Trust to such party of the Trust's
election to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it,
and the Trust will not be liable to such party under this Agreement
for any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than
reasonable costs of investigation.
7.3.4 You agree promptly to notify the Trust of the commencement of
any litigation or proceedings against you or the Indemnified Parties
in connection with this Agreement, the issuance or sale of the
Contracts, with respect to the operation of the Account, or the sale
or acquisition of shares of the Trust.
8. NOTICES
Any notice shall be sufficiently given when sent by registered or certified mail
to the other party at the address of such party set forth in Schedule G below or
at such other address as such party may from time to time specify in writing to
the other party.
14
9. TERMINATION
9.1 Any termination of this Agreement that is required by the Shared
Funding Order shall be governed by the provisions of the Shared Funding
Order.
9.2 This Agreement will terminate :
9.2.1 at our or your option, upon ten (10) calendar days prior
written notice to the other party, if a final non-appealable
administrative or judicial decision is entered against the other party
which has a material adverse impact on the Contracts or the
Portfolios;
9.2.2 at your option, upon ten (10) calendar days prior written
notice, if shares of the Trust are not reasonably available;
9.2.3 at your option, upon written notice, if the Trust ceases to
qualify as a Regulated Investment Company under Subchapter M of the
Code; or fails to meet the diversification requirements specified in
Section 817(h) of the Code and any regulations thereunder;
9.2.4 at our option, upon written notice, if any Contract: (i) ceases
to be treated as an annuity contract or life insurance contract under
applicable provisions of the Code; or (ii) fails to qualify as a
"variable contract" within the meaning of such term under Section 817
of the Code, as amended, or any regulations thereunder;
9.2.5 by mutual written agreement of you and us;
9.2.6 at the option of the Trust, in the event of a determination by
the Trustees that termination of the Agreement is necessary in the
exercise of their fiduciary duties under applicable laws and
regulations, upon such written notice as is consistent with these
legal or regulatory requirements;
9.2.7 at the option of the Trust, if you notify the Trust or the
Underwriter that the exemption from registration under Section 3(c) of
the 1940 Act no longer applies, or might not apply in the future, to
the unregistered Accounts, or that the exemption from registration
under Section 4(2) or Regulation D promulgated under the 1933 Act no
longer applies or might not apply in the future, to interests under
the unregistered Contracts;
9.2.8 upon the termination of the Amended and Restated Business
Agreement, originally entered into as of the 5th day of March 1999,
and amended on February 3, 2000, and amended and restated on October
18, 2002, by and among Hartford Life Insurance Company, Hartford Life
and Annuity Insurance Company, Hartford Securities Distribution
Company, Inc. and Franklin Xxxxxxxxx Distributors, Inc.;
9.2.9 at our option if: (i) you breach any of the representations and
warranties made in this Agreement; or (ii) you inform us that any of
such representations and warranties may no longer be true or might not
be true in the future; or (iii) any of such representations and
warranties were not true on the effective date of this Agreement, are
at any time no longer true, or have not been true during any time
since the effective date of this Agreement;
15
9.2.10 at your option if: (i) we breach any of the representations
and warranties made in this Agreement; or (ii) we inform you that any
of such representations and warranties may no longer be true or might
not be true in the future; or (iii) any of such representations and
warranties were not true on the effective date of this Agreement, are
at any time no longer true, or have not been true during any time
since the effective date of this Agreement; or
9.2.11 immediately in the event of its assignment by any party
without the prior written approval of the other parties, or as
otherwise required by law.
The effective date for termination pursuant to any notice given under this
Section 9.2 shall be calculated beginning with the date of receipt of such
notice.
9.3 If this Agreement is terminated for any reason except as required by
the Shared Funding Order, we shall, at your option and pursuant to the
terms and conditions of this Agreement, continue to make available
additional shares of any Portfolio and redeem shares of any Portfolio for
any or all Contracts or Accounts existing on the effective date of
termination of this Agreement, PROVIDED THAT such further sale is not
prohibited by law, regulation, or applicable regulatory or oversight body.
9.4 The provisions of Sections 2 (Representations and Warranties) and 7
(Indemnification) shall survive the termination of this Agreement. All
other applicable provisions of this Agreement shall survive the termination
of this Agreement, as long as shares of the Trust are held on behalf of
Contract owners in accordance with Section 9.3, except that we shall have
no further obligation to sell Trust shares with respect to Contracts issued
after termination.
9.5 You shall not redeem Trust shares attributable to the Contracts (as
opposed to Trust shares attributable to your assets held in the Account)
except: (i) as necessary to implement Contract owner initiated or approved
transactions; (ii) as required by state and/or federal laws or regulations
or judicial or other legal precedent of general application (hereinafter
referred to as a "Legally Required Redemption"); or (iii) as permitted by
an order of the SEC pursuant to Section 26(b) of the 1940 Act, SEC
no-action letter, or other legal and appropriate means. Upon request, you
shall promptly furnish to us the opinion of your counsel (which counsel
shall be reasonably satisfactory to us) to the effect that any redemption
pursuant to clause (ii) above is a Legally Required Redemption.
Furthermore, except in cases where permitted under the terms of the
Contracts, you shall not prevent Contract owners from allocating payments
to a Portfolio that was otherwise available under the Contracts without
first giving us ninety (90) days notice of your intention to do so.
10. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions of
this Agreement or otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, all of which taken together shall constitute one and the same
instrument.
16
10.3 If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
10.4 This Agreement shall be construed and its provisions interpreted
under and in accordance with the laws of the State of
California. It shall
also be subject to the provisions of the federal securities laws and the
rules and regulations thereunder, to any orders of the SEC on behalf of the
Trust granting it exemptive relief, and to the conditions of such orders.
We shall promptly forward copies of any such orders to you.
10.5 The parties to this Agreement acknowledge and agree that all
liabilities of the Trust arising, directly or indirectly, under this
Agreement, of any and every nature whatsoever, shall be satisfied solely
out of the assets of the Trust and that no Trustee, officer, agent or
holder of shares of beneficial interest of the Trust shall be personally
liable for any such liabilities.
10.6 The parties to this Agreement agree that the assets and liabilities
of each Portfolio of the Trust are separate and distinct from the assets
and liabilities of each other Portfolio. No Portfolio shall be liable or
shall be charged for any debt, obligation or liability of any other
Portfolio.
10.7 Each party to this Agreement shall cooperate with each other party
and all appropriate governmental authorities (including without limitation
the SEC, the NASD, and state insurance regulators) and shall permit such
authorities reasonable access to its books and records in connection with
any investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
10.8 Each party shall treat as confidential all information of the other
party which the parties agree in writing is confidential ("Confidential
Information"). Except as permitted by this Agreement or as required by
appropriate governmental authority (including, without limitation, the SEC,
the NASD, or state securities and insurance regulators) the receiving party
shall not disclose or use Confidential Information of the other party
before it enters the public domain, without the express written consent of
the party providing the Confidential Information. Each party further agrees
to use and disclose Personal Information, as defined below, only to carry
out the purposes for which it was disclosed to them and will not use or
disclose Personal Information if prohibited by applicable law, including,
without limitation, statutes and regulations enacted pursuant to the
Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102). For purposes of this
Agreement, "Personal Information" means financial and medical information
that identifies an individual personally and is not available to the
public, including, but not limited to credit history, income, financial
benefits, policy or claim information and medical records. If either party
outsource services to a third party, such third party will agree in writing
to maintain the security and confidentiality of any information shared with
them.
10.9 The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties to this Agreement are
entitled to under state and federal laws.
17
10.10 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect.
10.11 Neither this Agreement nor any rights or obligations created by it
may be assigned by any party without the prior written approval of the
other parties.
10.12 No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by
both parties.
10.13 This Agreement supercedes and replaces in its entirety the
Participation Agreement among Franklin Xxxxxxxxx Variable Insurance
Products Trust, Templeton Variable Products Series Fund, Franklin Xxxxxxxxx
Distributors, Inc., Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company, dated the 4th day of June, 1999.
18
IN WITNESS WHEREOF, each of the parties have caused their duly authorized
officers to execute this Agreement.
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxx
------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxxx X. Xxxxx
------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Distributor to the Company: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxx
------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C HEREOF. By: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxx Xxxxx
------------------------------
Name: Xxxxx Xxxxx
Title: President
19
SCHEDULE A
THE COMPANY AND ITS DISTRIBUTOR
THE COMPANY:
Hartford Life Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A life insurance company organized under the laws of the state of Connecticut.
Hartford Life and Annuity Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A life insurance company organized under the laws of the state of Connecticut.
DISTRIBUTOR TO THE COMPANY:
Hartford Securities Distribution Company, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A corporation incorporated in Connecticut.
20
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Hartford Life Insurance Company
Separate Account Seven
Date Established: December 8, 1986
SEC Registration Number: 811-04972
2. Name: Hartford Life and Annuity Insurance Company
Separate Account Seven
Date Established: April 1, 1999
SEC Registration Number: 811-09295
21
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
----------------------------------------------------------------------------------------------------------------
Franklin Income Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Large Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Real Estate Fund -- Class 2 Franklin Advisers, Inc.
Franklin Small Cap Fund -- Class 2 Franklin Advisers, Inc.
Franklin Strategic Income Securities Fund -- Class 1 Franklin Advisers, Inc.
Franklin Technology Securities Fund -- Class 2 Franklin Advisers, Inc.
Mutual Shares Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Templeton Developing Markets Securities Fund -- Class 1 Xxxxxxxxx Asset Management Ltd.
Templeton Foreign Securities Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Global Asset Allocation Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund -- Class 2 Xxxxxxxxx Global Advisors Limited
22
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Leaders Variable Hartford Life Insurance CLASS 1 SHARES:
Insurance Annuity Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Yes Yes Fund
333-69475 811-04972 Templeton Developing Markets Securities
HL-VA99 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
02 Hartford Life Hartford Leaders Variable Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Annuity Insurance Company Franklin Strategic Income Securities
Insurance Yes Sep.Acct. 7 Fund
Company 333-76419 Yes Templeton Developing Markets Securities
LA-VA99 811-09295 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
03 Hartford Life Hartford Leaders Access Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity (no CDSC) Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Yes Yes Fund
333-70153 811-04972 Templeton Developing Markets Securities
HL-NCDSC99 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
23
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
04 Hartford Life Hartford Leaders Access Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity (no CDSC) Insurance Company Sep. Franklin Strategic Income Securities
Insurance Yes Acct. 7 Fund
Company 333-76425 Yes Templeton Developing Markets Securities
LA-NCDSC99 811-09295 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
05 Hartford Life Hartford Leaders Edge Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity (front Company Sep. Acct. 7 Franklin Strategic Income Securities
Company end sales load) Yes Fund
Yes 811-04972 Templeton Developing Market Securities
333-68463 Fund
HL-ASHARE98 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
06 Hartford Life Hartford Leaders Edge Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity (front Insurance Company Sep. Franklin Strategic Income Securities
Insurance end sales load) Acct. 7 Fund
Company Yes Yes Templeton Developing Markets Securities
333-76423 811-09295 Fund
LA-ASHARE98 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
07 Hartford Life Hartford Leaders Plus Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity (payment Company Sep. Acct. 7 Franklin Strategic Income Securities
Company enhancement) Yes Fund
Yes 811-04972 Templeton Developing Markets Securities
333-91927 Fund
HL-VAXC99 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
24
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
08 Hartford Life Hartford Leaders Plus Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity (payment Insurance Company Sep. Franklin Strategic Income Securities
Insurance enhancement) Acct. 7 Fund
Company Yes Yes Templeton Developing Markets Securities
333-91921 811-09295 Fund
LA-VAXC99 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
09 Hartford Life Hartford Leaders Outlook Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity (3-year Company Sep. Acct. 7 Franklin Strategic Income Securities
Company CDSC) Yes Fund
Yes 811-04972 Templeton Developing Markets Securities
333-40414 Fund
HL-VA00 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
10 Hartford Life Hartford Leaders Outlook Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity (3-year Insurance Company Sep. Franklin Strategic Income Securities
Insurance CDSC) Acct. 7 Fund
Company Yes Yes Templeton Developing Markets Securities
333-40410 811-09295 Fund
LA-VA00 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Asset Strategy Fund
Templeton Growth Securities Fund
Xxxxxxxxx International Securities Fund
11 Hartford Life Hartford Leaders Vision Hartford Life Insurance CLASS 1 SHARES:
Insurance ("Wrap") Variable Annuity Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Yes Yes Fund
333-36138 811-04972 Templeton Developing Markets Securities
HL-NCDSC99 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
25
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT #, STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
12 Hartford Life Hartford Leaders Vision Hartford Life and Annuity CLASS 1 SHARES:
and Annuity ("Wrap") Variable Annuity Insurance Company Sep. Franklin Strategic Income Securities
Insurance Yes Acct. 7 Fund
Company 333-95785 Yes Templeton Developing Markets Securities
LA-NCDSC99 811-09295 Fund
CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Templeton Foreign Securities Fund
26
SCHEDULE E
THIS SCHEDULE NOT USED.
27
SCHEDULE F
RULE 12B-1 PLANS
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
MAXIMUM ANNUAL
PORTFOLIO NAME PAYMENT RATE
--------------------------------------------------------------------------------
Franklin Income Securities Fund -- Class 2 0.25%
Franklin Large Cap Growth Securities Fund -- Class 2 0.25%
Franklin Real Estate Fund -- Class 2 0.25%
Franklin Small Cap Fund -- Class 2 0.25%
Franklin Technology Securities Fund -- Class 2 0.25%
Mutual Shares Securities Fund -- Class 2 0.25%
Templeton Foreign Securities Fund -- Class 2 0.25%
Templeton Global Asset Allocation Fund -- Class 2 0.25%
Templeton Growth Securities Fund -- Class 2 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service which is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-l
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under NASD rules. Your
acceptance of such compensation is your acknowledgment that eligible services
have been rendered. All Rule 12b-1 fees, shall be based on the value of Eligible
Shares owned by the Company on behalf of its Accounts, and shall be calculated
on the basis and at the rates set forth in the Compensation Schedule stated
above. The aggregate annual fees paid pursuant to each Plan shall not exceed the
amounts stated as the "annual maximums" in the Portfolio's prospectus, unless an
increase is
28
approved by shareholders as provided in the Plan. These maximums shall be a
specified percent of the value of a Portfolio's net assets attributable to
Eligible Shares owned by the Company on behalf of its Accounts (determined in
the same manner as the Portfolio uses to compute its net assets as set forth in
its effective Prospectus). The Rule 12b-l fee will be paid to you within thirty
(30) days after the end of the three-month periods ending in January, April,
July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written report of the amounts expended under the
Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duly to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
29
SCHEDULE G
ADDRESSES FOR NOTICES
To the Company or the Distributor: Hartford Life Insurance Company or
Hartford Life and Annuity Insurance
Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Senior Vice President
With a copy to: Hartford Life Insurance Company or
Hartford Life and Annuity Insurance
Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxxxx
General Counsel
To the Trust: Franklin Xxxxxxxxx Variable Insurance
Products Trust
0 Xxxxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Assistant Vice President
To the Underwriter: Franklin Xxxxxxxxx Distributors, Inc.
Xxx Xxxxxxxx Xxxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Vice President
30
SCHEDULE H
SHARED FUNDING ORDER
Templeton Variable Products Series Fund, et al,
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24018
1999 SEC LEXIS 1887
September 17, 1999
ACTION: Notice of application for an amended order of exemption pursuant to
Section 6(c) of the Investment Company Act of 1940 (the "1940 Act") from the
provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act and Rules
6e-2(b)(15) and 6e-3(T)(b)(15) thereunder.
TEXT: Summary of Application: Templeton Variable Products Series Fund (the
"Templeton Trust"), Franklin Xxxxxxxxx Variable Insurance Products Trust
(formerly Franklin Valuemark Funds) (the "VIP Trust," and together with the
Templeton Trust, the "Funds"), Xxxxxxxxx Funds Annuity Company ("TFAC") or any
successor to TFAC, and any future open-end investment company for which TFAC or
any affiliate is the administrator, sub-administrator, investment manager,
adviser, principal underwriter, or sponsor ("Future Funds") seek an amended
order of the Commission to (1) add as parties to that order the VIP Trust and
any Future Funds and (2) permit shares of the Funds and Future Funds to be
issued to and held by qualified pension and retirement plans outside the
separate account context.
Applicants: Templeton Variable Products Series Fund, Franklin Xxxxxxxxx Variable
Insurance Products Trust, Xxxxxxxxx Funds Annuity Company or any successor to
TFAC, and any future open-end investment company for which TFAC or any affiliate
is the administrator, sub-administrator, investment manager, adviser, principal
underwriter, or sponsor (collectively, the "Applicants").
Filing Date: The application was filed on July 14, 1999, and amended and
restated on September 17, 1999.
Hearing or Notification of Hearing: An order granting the application will be
issued unless the Commission orders a hearing. Interested persons may request a
hearing by writing to the Secretary of the Commission and serving Applicants
with a copy or the request, personally or by mail. Hearing requests should be
received by the Commission by 5:30 p.m., on October 12, 1999, and should be
accompanied by proof of service on the Applicants in the form of an affidavit
or, for lawyers, a certificate of service. Hearing requests should state the
nature of the writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request notification
by writing to the Secretary of the Commission.
Addresses: Secretary, Securities and Exchange Commission, 000 Xxxxx Xxxxxx, XX,
Xxxxxxxxxx, X.X. 00000-0000
Applicants: Templeton Variable Products Series Fund and Franklin Xxxxxxxxx
Variable Insurance Products Trust, 000 Xxxxxxxx Xxxxxx Xxxxxxxxx, Xxx Xxxxx,
Xxxxxxxxxx 00000, Attn: Xxxxx X. Xxxxxxxx, Esq.
For Further Information Contact: Xxxxx X. XxXxxxx, Senior Counsel, or Xxxxx X.
Xxxxx, Branch Chief, Office of Insurance Products, Division of Investment
Management, at (000) 000-0000.
31
Supplementary Information: The following is a summary of the application. The
complete application is available for a fee from the SEC's Public Reference
Branch, 000 Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000-0000 (tel. (202)
000-0000).
Applicants' Representations:
1. Each of the Funds is registered under the 1940 Act as an open-end management
investment company and was organized as a Massachusetts business trust. The
Templeton Trust currently consists of eight separate series, and the VIP Trust
consists of twenty-five separate series. Each Fund's Declaration of Trust
permits the Trustees to create additional series of shares at any time. The
Funds currently serve as the underlying investment medium for variable annuity
contracts and variable life insurance policies issued by various insurance
companies. The Funds have entered into investment management agreements with
certain investment managers ("Investment Managers") directly or indirectly owned
by Franklin Resources, Inc. ("Resources"), a publicly owned company engaged in
the financial services industry through its subsidiaries.
2. TFAC is an indirect, wholly owned subsidiary of Resources. TFAC is the sole
insurance company in the Franklin Xxxxxxxxx organization, and specializes in the
writing of variable annuity contracts. The Templeton Trust has entered into a
Fund Administration Agreement with Franklin Xxxxxxxxx Services, Inc. ("FT
Services"), which replaced TFAC in 1998 as administrator, and FT Services
subcontracts certain services to TFAC. FT Services also serves as administrator
to all series of the VIP Trust. TFAC and FT Services provide certain
administrative facilities and services for the VIP and Templeton Trusts.
3. On November 16, 1993, the Commission issued an order granting exemptive
relief to permit shares of the Xxxxxxxxx Trust to be sold to and held by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies (Investment Company Act
Release No. 19879, File No. 812-8546) (the "Original Order"). Applicants
incorporate by reference into the application the Application for the Original
Order and each amendment thereto, the Notice of Application for the Original
Order, and the Original Order, to the extent necessary, to supplement the
representations made in the application in support of the requested relief.
Applicants represent that all of the facts asserted in the Application for the
Original Order and any amendments thereto remain true and accurate in all
material respects to the extent that such facts are relevant to any relief on
which Applicants continue to rely. The Original Order allows the Templeton Trust
to offer its shares to insurance companies as the investment vehicle for their
separate accounts supporting variable annuity contracts and variable life
insurance contracts (collectively, the "Variable Contracts"). Applicants state
that the Original Order does not (i) include the VIP Trust or Future Funds as
parties, nor (ii) expressly address the sale of shares of the Funds or any
Future Funds to qualified pension and retirement plans outside the separate
account context including, without limitation, those trusts, plans, accounts,
contracts or annuities described in Sections 401(a), 403(a), 403(b), 408(b),
408(k), 414(d), 457(b), 50l(c)(18) of the Internal Revenue Code of 1986, as
amended (the "Code"), and any other trust, plan, contract, account or annuity
that is determined to be within the scope of Treasury Regulation
1.8l7.5(f)(3)(iii) ("Qualified Plans").
4. Separate accounts owning shares of the Funds and their insurance company
depositors are referred to in the application as "Participating Separate
Accounts" and "Participating Insurance Companies," respectively. The use of a
common management investment company as the underlying investment medium for
both variable annuity and variable life insurance separate accounts of a single
insurance company (or of two or more affiliated insurance companies) is referred
to as "mixed funding." The use of a common management investment company as the
underlying investment medium for variable annuity and/or variable life insurance
separate accounts of unaffiliated insurance companies is referred to as "shared
funding."
Applicants' Legal Analysis:
1. Applicants request that the Commission issue an amended order pursuant to
Section 6(c) of the 1940 Act, adding the VIP Trust and Future Funds to the
Original Order and exempting scheduled premium variable life insurance separate
accounts and flexible premium variable life insurance separate accounts of
Participating Insurance Companies (and, to the extent necessary, any principal
underwriter and depositor of such an account) and the Applicants from Sections
9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and Rules 6e-2(b)(15) and
6e-3(T)(b)(15) (and any comparable rule) thereunder, respectively, to the extent
necessary to permit shares of the Funds and any Future Funds to be sold to and
held by
32
Qualified Plans. Applicants submit that the exemptions requested are appropriate
in the public interest, consistent with the protection of investors, and
consistent with the purposes fairly intended by the policy and provisions of the
1940 Act.
2. The Original Order does not include the VIP Trust or Future Funds as parties
nor expressly address the sale of shares of the Funds or any Future Funds to
Qualified Plans. Applicants propose that the VIP Trust and Future Funds be added
as parties to the Original Order and the Funds and any Future Funds be permitted
to offer and sell their shares to Qualified Plans.
3. Section 6(c) of the 1940 Act provides, in part, that the Commission, by
order upon application, may conditionally or unconditionally exempt any person,
security or transaction, or any class or classes of persons, securities of
transactions from any provisions of the 1940 Act or the rules or regulations
thereunder, if and to the extent that such exemption is necessary or appropriate
in the public interest and consistent with the protection of investors and the
purposes fairly intended by the policy and provisions of the 1940 Act.
4. In connection with the funding of scheduled premium variable life insurance
contracts issued through a separate account registered under the 1940 Act as a
unit investment Trust ("UIT"), Rule 6e-2(b)(15) provides partial exemptions from
various provisions of the 1940 Act, including the following: (1) Section 9(a),
which makes it unlawful for certain individuals to act in the capacity of
employee, officer, or director for a UIT, by limiting the application of the
eligibility restrictions in Section 9(a) to affiliated persons directly
participating in the management of a registered management investment company,
and (2) Sections 13(a), 15(a) and 15(b) of the 1940 Act to the extent that those
sections might be deemed to require "pass-through" voting with respect to an
underlying fund's shares, by allowing an insurance company to disregard the
voting instructions of contractowners in certain circumstances.
5. These exemption are available, however, only where the management investment
company underlying the separate account (the "underlying fund") offers its
shares "exclusively to variable life insurance separate accounts of the life
insurer, or of my affiliated life insurance company." Therefore, Rule 6e-2 does
not permit either mixed funding or shared Funding because the relief granted by
Rule 6e-2(b)(15) is not available with respect to a scheduled premium variable
life insurance separate account that owns shares of an underlying fund that also
offers its shares to a variable annuity or a flexible premium variable life
insurance separate account of the same company or of any affiliated life
insurance company. Rule 6e-2(b)(15) also does not permit the sale of shares of
the underlying fund to Qualified Plans.
6. In connection with flexible premium variable life insurance contracts issued
through a separate account registered under the 1940 Act as a UIT, Rule
6e-3(T)(b)(15) also provides partial exemption from Sections 9(a), 13(a), 15(a)
and 15(b) of the 1940 Act. These exemptions, however, are available only where
the separate account's underlying fund offers its shares "exclusively to
separate accounts of the life insurer, or of any affiliated life insurance
company, offering either scheduled contracts or flexible contracts, or both; or
which also offer their shares to variable annuity separate accounts of the life
insurer or of an affiliated life insurance company." Therefore, Rule 6e-3(T)
permits mixed funding but does not permit shared funding and also does not
permit the sale of shares of the underlying fund to Qualified Plans. As noted
above, the Original Order granted the Templeton Trust exemptive relief to permit
mixed and shared funding, but did not expressly address the sale of its shares
to Qualified Plans.
7. Applicants note that if the Funds were to sell their shares only to
Qualified Plans, exemptive relief under Rule 6e-2 and Rule 6e-3(T) would not be
necessary. Applicants state that the relief provided for under Rule 6e-2(b)(15)
and Rule 6e-3(T)(b)(15) does not relate to qualified pension and retirement
plans or to a registered investment company's ability to sell its shares to such
plans.
8. Applicants state that changes in the federal tax law have created the
opportunity for each of the Funds to increase its asset base through the sale of
its shares to Qualified Plans. Applicants state that Section 817(h) of the
Internal Revenue Code of 1986, as amended (the "Code"), imposes certain
diversification standards on the assets underlying Variable Contracts. Treasury
Regulations generally require that, to meet the diversification requirements,
all of the beneficial interests in the underlying investment company must be
held by the segregated asset accounts of one or more life insurance companies
Notwithstanding this, Applicants note that the Treasury Regulations also contain
an exception to this requirement that permits trustees of a Qualified Plan to
hold shares of an investment company, the shares of which are also held by
insurance company segregated asset accounts, without adversely affecting the
status of the investment
33
company as an adequately diversified underlying investment of Variable Contracts
issued through such segregated asset accounts (Treas. Reg. 1.817-5(f)(3)(iii)).
9. Applicants state that the promulgation of Rules 6e-2(b)(15) and
6e-3(T)(b)(15) under the 1940 Act preceded the issuance of those Treasury
Regulations. Thus, Applicants assert that the sale of shares of the same
investment company to both separate accounts and Qualified Plans was not
contemplated at the time of the adoption of Rules 6e-2(b)(15) and
6e-3(T)(b)(15).
10. Section 9(a) provides that it is unlawful for any company to serve as
investment adviser or principal underwriter of any registered open-end
investment company if an affiliated person of that company is subject to a
disqualification enumerated in Section 9(a)(1) or (2), Rules 6e-2(b)(15) and
6e-3(T)(b)(15) provide exemptions from Section 9(a) under certain circumstances,
subject to the limitations on mixed and shared funding. These exemptions limit
the application of the eligibility restrictions to affiliated individuals or
companies that directly participate in the management of the underlying
portfolio investment company.
11. Applicants state that the relief granted in Rule 6e-2(b)(15) and
6e-3(T)(b)(15) from the requirements of Section 9 limits, in effect, the amount
of monitoring of an insurer's personnel that would otherwise be necessary to
ensure compliance with Section 9 to that which is appropriate in light of the
policy and purposes of Section 9. Applicants submit that those Rules recognize
that it is not necessary for the protection of investors or the purposes fairly
intended by the policy and provisions of the 1940 Act to apply the provisions of
Section 9(a) to the many individuals involved in an insurance company complex,
most of whom typically will have no involvement in matters pertaining to
investment companies funding the separate accounts.
12. Applicants to the Original Order previously requested and received relief
from Section 9(a) and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) to the extent
necessary to permit mixed and shared funding. Applicants maintain that the
relief previously granted from Section 9(a) will in no way be affected by the
proposed sale of shares of the Funds to Qualified Plans. Those individuals who
participate in the management or administration of the Funds will remain the
same regardless of which Qualified Plans use such Funds. Applicants maintain
that more broadly applying the requirements of Section 9(a) because of
investment by Qualified Plans would not serve any regulatory purpose. Moreover,
Qualified Plans, unlike separate accounts, are not themselves investment
companies and therefore are not subject to Section 9 of the 1940 Act.
13. Applicants state that Rules 6e-2(b)(15)(iii) and 6e-3(T)(b)(15)(iii)
provide exemptions from the pass-through voting requirement with respect to
several significant matters, assuming the limitations on mixed and shared
funding are observed. Rules 6e-2(b)(15)(iii)(A) and 6e-3(T)(b)(15)(iii)(A)
provide that the insurance company may disregard the voting instructions of its
contractowners with respect to the investments of an underlying fund or any
contracts between a fund and its investment adviser, when required to do so by
an insurance regulatory authority (subject to the provisions of paragraphs
(b)(5)(i) and (b)(7)(ii)(A) of the Rules). Rules 6e-2(b)(15)(iii)(B) and
6e-3(T)(b)(15)(iii)(A)(2) provide that the insurance company may disregard
contractowners' voting instructions if the contractowners initiate any change in
such company's investment policies, principal underwriter, or any investment
adviser (provided that disregarding such voting instructions is reasonable and
subject to the other provisions of paragraphs (b)(5)(ii) and (b)(7)(ii)(B) and
(C) of the Rules).
14. Applicants assert that Qualified Plans, which are not registered as
investment companies under the 1940 Act, have no requirement to pass-through the
voting rights to plan participants. Applicants state that applicable law
expressly reserves voting rights to certain specified persons. Under Section
403(a) of the Employment Retirement Income Security Act ("ERISA"), shares of a
fund sold to a Qualified Plan must be held by the trustees of the Qualified
Plan. Section 403(a) also provides that the trustee(s) must have exclusive
authority and discretion to manage and control the Qualified Plan with two
exceptions: (1) when the Qualified Plan expressly provides that the trustee(s)
are subject to the direction of a named fiduciary who is not a trustee, in which
case the trustees are subject to proper directions made in accordance with the
terms of the Qualified Plan and not contrary to ERISA; and (2) when the
authority to manage, acquire or dispose of assets of the Qualified Plan is
delegated to one or more investment managers pursuant to Section 402(c)(3) of
ERISA. Unless one of the two above exceptions stated in Section 403(a) applies.
Qualified Plan trustees have the exclusive authority and responsibility for
voting proxies. Where a named fiduciary to a Qualified Plan appoints an
investment manager, the investment manager has the responsibility to vote the
shares held unless the right to vote such
34
shares is reserved to the trustees or the named fiduciary. Where a Qualified
Plan does not provide participants with the right to give voting instructions,
Applicants do not see any potential for material irreconcilable conflicts of
interest between or among variable contract holders and Qualified Plan investors
with respect to voting of the respective Fund's shares. Accordingly, Applicants
state that, unlike the case with insurance company separate accounts, the issue
of the resolution of material irreconcilable conflicts with respect to voting is
not present with respect to such Qualified Plans since the Qualified Plans are
not entitled to pass-through voting privileges.
15. Even if a Qualified Plan were to hold a controlling interest in one of the
Funds, Applicants believe that such control would not disadvantage other
investors in such Fund to any greater extent than is the case when any
institutional shareholder holds a majority of the voting securities of any
open-end management investment company. In this regard, Applicants submit that
investment in a Fund by a Qualified Plan will not create any of the voting
complications occasioned by mixed funding or shared funding. Unlike mixed or
shared funding. Qualified Plan investor voting rights cannot be frustrated by
veto rights of insurers or state regulators.
16. Applicants state that some of the Qualified Plans, however, may provide for
the trustee(s), an investment adviser (or advisers), or another named fiduciary
to exercise voting rights in accordance with instructions from participants.
Where a Qualified Plan provides participants with the right to give voting
instructions, Applicants see no reason to believe that participants in Qualified
Plans generally or those in a particular Qualified Plan, either as a single
group or in combination with participants in other Qualified Plans, would vote
in a manner that would disadvantage Variable Contract holders. In sum,
Applicants maintain that the purchase of shares of the Funds by Qualified Plans
that provide voting rights does not present any complications not otherwise
occasioned by mixed or shared funding.
17. Applicants do not believe that the sale of the shares of the Funds to
Qualified Plans will increase the potential for material irreconcilable
conflicts of interest between or among different types of investors. In
particular, Applicants see very little potential for such conflicts beyond that
which would otherwise exist between variable annuity and variable life insurance
contractowners.
18. As noted above, Section 817(h) of the Code imposes certain diversification
standards on the underlying assets of variable contracts held in an underlying
mutual fund. The Code provides that a variable contract shall not be treated as
an annuity contract or life insurance, as applicable, for any period (and any
subsequent period) for which the investments are not, in accordance with
regulations prescribed by the Treasury Department, adequately diversified.
19. Treasury Department Regulations issued under Section 817(h) provide that,
in order to meet the statutory diversification requirements, all of the
beneficial interests in the investment company must be held by the segregated
asset accounts of one or more insurance companies. However, the Regulations
contain certain exceptions to this requirement, one of which allows shares in an
underlying mutual fund to be held by the trustees of a qualified pension or
retirement plan without adversely affecting the ability of shares in the
underlying fund also to be held by separate accounts of insurance companies in
connection with their variable contracts (Treas. Reg. 1.817-5(f)(3)(iii)). Thus,
Applicants believe that the Treasury Regulations specifically permit "qualified
pension or retirement plans" and separate accounts to invest in the same
underlying fund. For this reason, Applicants have concluded that neither the
Code nor the Treasury Regulations or revenue rulings thereunder presents any
inherent conflict of interest.
20. Applicants note that while there are differences in the manner in which
distributions from Variable Contracts and Qualified Plans are taxed, these
differences will have no impact on the Funds. When distributions are to be made,
and a Separate Account or Qualified Plan is unable to net purchase payments to
make the distributions, the Separate Account and Qualified Plan will redeem
shares of the Funds at their respective net asset value in conformity with Rule
22c-1 under the 1940 Act (without the imposition of any sales charge) to provide
proceeds to meet distribution needs. A Qualified Plan will make distributions in
accordance with the terms of the Qualified Plan.
21. Applicants maintain that it is possible to provide an equitable means of
giving voting rights to Participating Separate Account contractowners and to
Qualified Plans. In connection with any meeting of shareholders, the Funds will
inform each shareholder, including each Participating Insurance Company and
Qualified Plan, of information necessary for the meeting, including their
respective share of ownership in the relevant Fund. Each Participating Insurance
Company will then solicit voting instructions in accordance with Rules 6e-2 and
6e-3(T), as applicable, and its
participation agreement with the relevant Fund.
Shares held by Qualified Plans will be voted in accordance with
35
applicable law. The voting rights provided to Qualified Plans with respect to
shares of the Funds would be no different from the voting rights that are
provided to Qualified Plans with respect to shares of funds sold to the general
public.
22. Applicants have concluded that even if there should arise issues with
respect to a state insurance commissioner's veto powers over investment
objectives where the interests of contractowners and the interests of Qualified
Plans are in conflict, the issues can be almost immediately resolved since the
trustees of (or participants in) the Qualified Plans can, on their own, redeem
the shares out of the Funds. Applicants note that state insurance commissioners
have been given the veto power in recognition of the fact that insurance
companies usually cannot simply redeem their separate accounts out of one fund
and invest in another. Generally, time-consuming, complex transactions must be
undertaken to accomplish such redemptions and transfers. Conversely, the
trustees of Qualified Plans or the participants in participant-directed
Qualified Plans can make the decision quickly and redeem their interest in the
Funds and reinvest in another funding vehicle without the same regulatory
impediments faced by separate accounts or, as is the case with most Qualified
Plans, even hold cash pending suitable investment.
23. Applicants also state that they do not see any greater potential for
material irreconcilable conflicts arising between the interests of participants
under Qualified Plans and contractowners of Participating Separate Accounts from
possible future changes in the federal tax laws than that which already exist
between variable annuity contractowners and variable life insurance
contractowners.
24. Applicants state that the sale of shares of the Funds to Qualified Plans in
addition to separate accounts of Participating Insurance Companies will result
in an increased amount of assets available for investment by the Funds. This may
benefit variable contractowners by promoting economies of scale, by permitting
increased safety of investments through greater diversification, and by making
the addition of new portfolios more feasible.
25. Applicants assert that, regardless of the type of shareholders in each
Fund, each Fund's Investment Manager is or would be contractually and otherwise
obligated to manage the Fund solely and exclusively in accordance with that
Fund's investment objectives, policies and restrictions as well as any
guidelines established by the Board of Trustees of such Fund (the "Board"). The
Investment Manager works with a pool of money and (except in a few instances
where this may be required in order to comply with state insurance laws) does
not take into account the identity of the shareholders. Thus, each Fund will be
managed in the same manner at any other mutual fund. Applicants therefore see no
significant legal impediment to permitting the sale of shares of the Funds to
Qualified Plans.
26. Applicants state that the Commission has permitted the amendment of a
substantially similar original order for the purpose of adding a party to the
original order and has permitted open-end management investment companies to
offer their shares directly to Qualified Plan in addition to separate accounts
of affiliated or unaffiliated insurance companies which issue either or both
variable annuity contracts or variable life insurance contracts. Applicants
state that the amended order sought in the application is identical to precedent
with respect to the conditions Applicants propose should be imposed on Qualified
Plans in connection with investment in the Funds.
Applicants' Conditions:
If the requested amended order is granted, Applicants consent to the following
conditions:
1. A majority of the Board of each Fund shall consist of persons who are not
"interested persons" thereof, as defined by Section 2(a)(19) of the 1940 Act,
and the rules thereunder and as modified by any applicable orders of the
Commission, except that if this condition is not met by reason of the death,
disqualification or bona fide resignation of any Board Member or Members, then
the operation of this condition shall be suspended: (a) for a period of 45 days
if the vacancy or vacancies may be filled by the remaining Board Members; (b)
for a period of 60 days if a vote of shareholders is required to fill the
vacancy or vacancies; or (c) for such longer period as the Commission may
prescribe by order upon application.
2. The Board will monitor their respective Fund for the existence of any
material irreconcilable conflict among the interests of the Variable Contract
owners of all Separate Accounts investing in the Funds and of the Qualified Plan
participants investing in the Funds. The Board will determine what action, if
any, shall be taken in response to such conflicts. A material irreconcilable
conflict may arise for a variety of reasons, including: (a) an action by any
state
36
insurance regulatory authority; (b) a change in applicable federal or state
insurance, tax or securities laws or regulations, or a public ruling, private
letter ruling, no-action or interpretive letter, or any similar action by
insurance, tax or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant proceeding, (d) the manner in which the
investments of the Funds are being managed; (e) a difference in voting
instructions given by variable annuity contract owners, variable life insurance
contract owners, and trustees of Qualified Plans; (f) a decision by an insurer
to disregard the voting instructions of Variable Contract owners; or (g) if
applicable, a decision by a Qualified Plan to disregard the voting instructions
of Qualified Plan participants.
3. Participating Insurance Companies, the Investment Managers, and any
Qualified Plan that executes a fund
participation agreement upon becoming an
owner of 10 percent or more of the assets of an Fund (a "Participating Qualified
Plan"), will report any potential or existing conflicts of which it becomes
aware to the Board of any relevant Fund. Participating Insurance Companies, the
Investment Managers and the Participating Qualified Plans will be responsible
for assisting the Board in carrying out its responsibilities under these
conditions by providing the Board with all information reasonably necessary for
the Board to consider any issues raised. This responsibility includes, but is
not limited to, an obligation by each Participating Insurance Company to inform
the Board whenever voting instructions of Contract owners are disregarded and,
if pass-through voting is applicable, an obligation by each Participating
Qualified Plan to inform the Board whenever it has determined to disregard
Qualified Plan participant voting instructions. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
obligations of all Participating Insurance Companies investing in the Funds
under their agreements governing participation in the Funds, and such agreements
shall provide that these responsibilities will be carried out with a view only
to the interests of the Variable Contract owners. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
obligations of all Participating Qualified Plans under their agreements
governing participation in the Funds, and such agreements will provide that
their responsibilities will be carried out with a view only to the interests of
Qualified Plan participants.
4. If it is determined by a majority of the Board of a Fund, or by a majority
of the disinterested Board Members, that a material irreconcilable conflict
exists, the relevant Participating Insurance Companies and Participating
Qualified Plans will, at their own expense and to the extent reasonably
practicable as determined by a majority of the disinterested Board Members, take
whatever steps are necessary to remedy or eliminate the material irreconcilable
conflict, which steps could include: (a) in the case of Participating Insurance
Companies, withdrawing the assets allocable to some or all of the Separate
Account a from the Fund or any portfolio thereof and reinvesting such assets in
a different investment medium, including another portfolio of an Fund or another
Fund, or submitting the question as to whether such segregation should be
implemented to a vote of all affected Variable Contract owners and, as
appropriate, segregating the assets of any appropriate group (i.e., variable
annuity contract owners or variable life insurance contract owners of one or
more Participating Insurance Companies) that votes in favor of such segregation,
or offering to the affected Variable Contract owners the option of making such a
change; (b) in the case of Participating Qualified Plans, withdrawing the assets
allocable to some or all of the Qualified Plans from the Fund and reinvesting
such assets in a different investment medium; and (c) establishing a new
registered management investment company or managed Separate Account. If a
material irreconcilable conflict arises because of a decision by a Participating
Insurance Company to disregard Variable Contract owner voting instructions, and
that decision represents a minority position or would preclude a majority vote,
then the insurer may be required, at the Fund's election, to withdraw the
insurer's Separate Account investment in such Fund, and no charge or penalty
will be imposed as a result of such withdrawal. If a material irreconcilable
conflict arises because of a Participating Qualified Plan's decision to
disregard Qualified Plan participant voting instructions, if applicable, and
that decision represents minority position or would preclude a majority vote,
the Participating Qualified Plan may be required, at the Fund's election, to
withdraw its investment in such Fund, and no charge or penalty will be imposed
as a result of such withdrawal. The responsibility to take remedial action in
the event of a determination by a Board of a material irreconcilable conflict
and to bear the cost of such remedial action will be a contractual obligation of
all Participating Insurance Companies and Participating Qualified Plans under
their agreements governing participation in the Funds, and these
responsibilities will be carried out with a view only to the interest of
Variable Contract owners and Qualified Plan participants.
5. For purposes of Condition 4, a majority of the disinterested Board Members
of the applicable Board will determine whether or not any proposed action
adequately remedies any material irreconcilable conflict, but in no event will
the relevant Fund or the Investment Managers be required to establish a new
funding medium for any Contract. No Participating Insurance Company shall be
required by Condition 4 to establish a new funding medium for any Variable
37
Contract if any offer to do so has been declined by vote of a majority of the
Variable Contract owners materially and adversely affected by the material
irreconcilable conflict. Further, no Participating Qualified Plan shall be
required by Condition 4 to establish a new funding medium for any Participating
Qualified Plan if (a) a majority of Qualified Plan participants materially and
adversely affected by the irreconcilable material conflict vote to decline such
offer, or (b) pursuant to governing Qualified Plan documents and applicable law,
the Participating Qualified Plan makes such decision without a Qualified Plan
participant vote.
6. The determination of the Board of the existence of a material irreconcilable
conflict and its implications will be made known in writing promptly to all
Participating Insurance Companies and Participating Qualified Plans.
7. Participating Insurance Companies will provide pass-through voting
privileges to Variable Contract owners who invest in registered Separate
Accounts so long as and to the extent that the Commission continues to interpret
the 1940 Act as requiring pass-through voting privileges for Variable Contract
owners. As to Variable Contracts issued by unregistered Separate Accounts,
pass-through voting privileges will be extended to participants to the extent
granted by issuing insurance companies. Each Participating Insurance Company
will also vote shares of the Funds held in its Separate Accounts for which no
voting instructions from Contract owners are timely received, as well as shares
of the Funds which the Participating Insurance Company itself owns, in the same
proportion as those shares of the Funds for which voting instructions from
contract owners are timely received. Participating Insurance Companies will be
responsible for assuring that each of their registered Separate Accounts
participating in the Funds calculates voting privileges in a manner consistent
with other Participating Insurance Companies. The obligation to calculate voting
privileges in a manner consistent with all other registered Separate Accounts
investing in the Funds will be a contractual obligation of all Participating
Insurance Companies under their agreements governing their participation in the
Funds. Each Participating Qualified Plan will vote as required by applicable law
and governing Qualified Plan documents.
8. All reports of potential or existing conflicts received by the Board of a
Fund and all action by such Board with regard to determining the existence of a
conflict, notifying Participating Insurance Companies and Participating
Qualified Plans of a conflict, and determining whether any proposed action
adequately remedies a conflict, will be properly recorded in the minutes of the
meetings of such Board or other appropriate records, and such minutes or other
records shall be made available to the Commission upon request.
9. Each Fund will notify all Participating Insurance Companies that separate
disclosure in their respective Separate Account prospectuses may be appropriate
to advise accounts regarding the potential risks of mixed and shared funding.
Each Fund shall disclose in its prospectus that (a) the Fund is intended to be a
funding vehicle for variable annuity and variable life insurance contracts
offered by various insurance companies and for qualified pension and retirement
plans; (b) due to differences of tax treatment and other considerations, the
interests of various Contract owners participating in the Fund and/or the
interests of Qualified Plans investing in the Fund may at some time be in
conflict; and (c) the Board of such Fund will monitor events in order to
identify the existence of any material irreconcilable conflicts and to determine
what action, if any, should be taken in response to any such conflict.
10. Each Fund will comply with all provisions of the 1940 Act requiring voting
by shareholders (which, for these purposes, will be the persons having a voting
interest in the shares of the Funds), and, in particular, the Funds will either
provide for annual shareholder meetings (except insofar as the Commission may
interpret Section 16 of the 1940 Act not to require such meetings) or comply
with Section 16(c) of the 1940 Act, although the Funds are not the type of trust
described in Section 16(c) of the 1940 Act, as well as with Section 16(a) of the
1940 Act and, if and when applicable, Section 16(b) of the 1940 Act. Further,
each Fund will act in accordance with the Commission's interpretation of the
requirements of Section 16(a) with respect to periodic elections of Board
Members and with whatever rules the Commission may promulgate with respect
thereto.
11. If and to the extent Rules 6e-2 or 6e-3(T) under the 1940 Act is amended,
or proposed Rule 6e-3 under the 1940 Act is adopted, to provide exemptive relief
from any provision of the 1940 Act or the rules promulgated thereunder, with
respect to mixed or shared funding on terms and conditions materially different
from any exemptions granted in the order requested in the application, then the
Funds and/or Participating Insurance Companies and Participating Qualified
Plans, as appropriate, shall take such steps as may be necessary to comply with
such Rules 6e-2 and 6e-3(T), as amended, or proposed Rule 6e-3, as adopted, to
the extent that such Rules are applicable.
38
12. The Participating Insurance Companies and Participating Qualified Plans
and/or the Investment Managers, at least annually, will submit to the Board such
reports, materials or data as the Board may reasonably request so that the Board
may fully carry out obligations imposed upon it by the conditions contained in
the application. Such reports, materials and data will be submitted more
frequently if deemed appropriate by the Board. The obligations of the
Participating Insurance Companies and Participating Qualified Plans to provide
these reports, materials and data to the Board, when the Board so reasonably
requests, shall be a contractual obligation of all Participating Insurance
Companies and Participating Qualified Plans under their agreements governing
participation in the Funds.
13. If a Qualified Plan should ever become a holder of ten percent or more of
the assets of a Fund, such Qualified Plan will execute a
participation agreement
with the Fund that includes the conditions set forth herein to the extent
applicable. A Qualified Plan will execute an application containing an
acknowledgment of this condition upon such Qualified Plan's initial purchase of
the shares of any Fund.
Conclusion:
Applicants assert that, for the reasons summarized above, the requested
exemptions are appropriate in the public interest and consistent with the
protection of investors and the purposes fairly intended by the policy and
provisions of the 1940 Act.
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
39
Templeton Variable Products Series Fund, et al.
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24079
1999 SEC LEXIS 2177
October 13, 1999
ACTION: Order Granting Exemptions
TEXT: Templeton Variable Products Series Fund ("Templeton Trust"), Franklin
Xxxxxxxxx Variable Insurance Products Trust ("VIP Trust"), Xxxxxxxxx Funds
Annuity Company ("TFAC") or any successor to TFAC, and any future open-end
investment company for which TFAC or any affiliate is the administrator,
sub-administrator, investment manager, adviser, principal underwriter, or
sponsor ("Future Funds") filed an application on July 14, 1999, and an amendment
on September 17, 1999 seeking an amended order of the Commission pursuant to
Section 6(c) of the Investment Company Act of 1940 ("1940 Act") exempting them
from the provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15). The prior order (Rel. No. IC-19879)
granted exemptive relief to permit shares of the Templeton Trust to be sold to
and held by variable annuity and variable life insurance separate accounts of
both affiliated and unaffiliated life insurance companies. The proposed relief
would amend the prior order to add as parties to that order the VIP Trust and
any Future Funds and to permit shares of the Templeton Trust, the VIP Trust, and
Future Funds to be issued to and held by qualified pension and retirement plans
outside the separate account context.
A notice of the filing of the application was issued on September 17, 1999 (Rel.
No. IC-24018). The notice gave interested persons an opportunity to request a
hearing and stated that an order granting the application would be issued unless
a hearing should be ordered. No request for a hearing has been filed, and the
Commission has not ordered a hearing.
The matter has been considered, and it is found that granting the requested
exemptions is appropriate in the public interest and consistent with the
protection of investors and the purposes intended by the policy and provisions
of the 1940 Act.
Accordingly,
IT IS ORDERED, pursuant to Section 6(c) of the 1940 Act, that the requested
exemptions from Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and Rules
6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, be, and hereby are, granted,
effective forthwith.
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
40
AMENDMENT TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
As of May 1, 2003
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company,
Hartford Life and Annuity Insurance Company,
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company, Hartford Life and Annuity
Insurance Company ("you"), and Hartford Securities Distribution Company, Inc.,
your distributor, on your behalf and on behalf of certain Accounts, have
previously entered into a
Participation Agreement dated May 1, 2000 (the
"Agreement"). The parties now desire to amend the Agreement in this Amendment
(the "Amendment").
NOW, THEREFORE, in consideration of past and prospective business relations,
each of the parties hereto agree as follows:
1. Schedules C, D and F to the Agreement are hereby amended, restated and
replaced in their entirety with Schedules C, D and F attached to and made a
part of this Amendment.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 1, 2003.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxx Xxxxx
-----------------------------
Name: Xxxxx Xxxxx
Title: President
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC
By: /s/ Xxxxxx Xxx
-----------------------------
Name: Xxxxxx Xxx
Title: Chief Compliance Officer
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
2
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
------------------------------------------------------------------------------------------------------
Franklin Income Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Large Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Real Estate Fund -- Class 2 Franklin Advisers, Inc.
Franklin Rising Dividends Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Small Cap Fund -- Class 2 Franklin Advisers, Inc.
Franklin Strategic Income Securities Fund -- Class 1 Franklin Advisers, Inc.
Mutual Discovery Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Mutual Shares Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Templeton Developing Markets Securities Fund -- Class 1 Xxxxxxxxx Asset Management Ltd.
Templeton Foreign Securities Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Global Asset Allocation Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund -- Class 2 Xxxxxxxxx Global Advisors Limited
3
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Leaders Hartford Life CLASS 1 SHARES:
Insurance Variable Annuity Insurance Company Franklin Strategic Income Securities Fund
Company Yes Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
333-69475 Yes CLASS 2 SHARES:
HL-VA99 811-04972 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
02 Hartford Life Hartford Leaders Hartford Life and CLASS 1 SHARES:
and Annuity Variable Annuity Annuity Insurance Franklin Strategic Income Securities Fund
Insurance Yes Company Sep.Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company 333-76419 Yes CLASS 2 SHARES:
LA-VA99 811-09295 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
03 Hartford Life Hartford Leaders Hartford Life CLASS 1 SHARES:
Insurance Access Variable Insurance Company Franklin Strategic Income Securities Fund
Company Annuity (no CDSC) Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Yes Yes CLASS 2 SHARES:
333-70153 811-04972 Franklin Real Estate Fund
HL-NCDSC99 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
4
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
----------------------------------------------------------------------------------------------------------------------
04 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Access Variable Insurance Company Sep.Acct. 7 Franklin Strategic Income Securities
Insurance Annuity (no CDSC) Yes Fund
Company Yes 811-09295 Xxxxxxxxx Developing Markets Securities
333-76425 Fund
LA-NCDSC99 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
05 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Edge Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (front Yes Fund
end sales load) 811-04972 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-68463 CLASS 2 SHARES:
HL-ASHARE98 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
06 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Edge Variable Insurance Company Sep.Acct. 7 Franklin Strategic Income Securities
Insurance Annuity (front Yes Fund
Company end sales load) 811-09295 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-76423 CLASS 2 SHARES:
LA-ASHARE98 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
5
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
----------------------------------------------------------------------------------------------------------------------
07 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Plus Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (payment Yes Fund
enhancement) 811-04972 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-91927 CLASS 2 SHARES:
HL-VAXC99 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
08 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Plus Variable Insurance Company Sep.Acct. 7 Franklin Strategic Income Securities
Insurance Annuity (payment Yes Fund
Company enhancement) 811-09295 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-91921 CLASS 2 SHARES:
LA-VAXC99 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
09 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Outlook Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (3-year Yes Fund
CDSC) 811-04972 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-40414 CLASS 2 SHARES:
HL-VA00 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
6
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
10 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Outlook Variable Insurance Company Franklin Strategic Income Securities
Insurance Annuity (3-year Sep.Acct. 7 Fund
Company CDSC) Yes Xxxxxxxxx Developing Markets Securities
Yes 811-09295 Fund
333-40410 CLASS 2 SHARES:
LA-VA00 Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
11 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Vision ("Wrap") Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Variable Annuity Yes Fund
Yes 811-04972 Xxxxxxxxx Developing Markets Securities
333-36138 Fund
HL-NCDSC99 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Small Cap Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
12 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Vision ("Wrap") Insurance Company Franklin Strategic Income Securities
Insurance Variable Annuity Sep. Acct. 7 Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-95785 811-09295 Fund
LA-NCDSC99 CLASS 2 SHARES:
Franklin Real Estate Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual ShaSecurities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
13 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity Company Sep. Acct. 7 Franklin Strategic Income Securities
Company (Series II) Yes Fund
Yes 811-04972 Xxxxxxxxx Developing Markets Securities
333-101932 Fund
HL-VA03 CLASS 2 SHARES:
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
7
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
14 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity Insurance Company Franklin Strategic Income Securities
Insurance (Series II) Sep. Acct. 7 Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-101933 811-09295 Fund
LA-VA03 CLASS 2 SHARES:
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
15 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Access Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (Series Yes Fund
II) 811-04972 CLASS 2 SHARES:
Yes Franklin Income Securities Fund
333-101937 Franklin Large Cap Growth Securities
HL-NCDSC03 Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
16 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Access Variable Insurance Company Franklin Strategic Income Securities
Insurance Annuity (Series Sep. Acct. 7 Fund
Company II) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Income Securities Fund
333-101936 Franklin Large Cap Growth Securities
LA-NCDSC03 Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
17 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Edge Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (Series Yes Fund
II) 811-04972 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-101942 CLASS 2 SHARES:
HL-ASHARE03 Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
8
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
------------------------------------------------------------------------------------------------------------------------
18 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Edge Variable Insurance Company Sep. Acct. 7 Franklin Strategic Income Securities
Insurance Annuity (Series II) Yes Fund
Company Yes 811-09295 Xxxxxxxxx Developing Markets
333-101943 Securities Fund
LA-ASHARE03 CLASS 2 SHARES:
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
19 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Plus Variable Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Annuity (Series II) Yes Fund
Yes 333-101948 811-04972 Xxxxxxxxx Developing Markets
HL-VAXC03 Securities Fund
CLASS 2 SHARES:
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
20 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Plus Variable Insurance Company Sep. Acct. 7 Franklin Strategic Income Securities
Insurance Company Annuity (Series II) Yes Fund
Yes 811-09295 Xxxxxxxxx Developing Markets
333-101949 Securities Fund
LA-VAXC03 CLASS 2 SHARES:
Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
21 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Outlook Company Sep. Acct. 7 Franklin Strategic Income Securities
Company Variable Annuity Yes Fund
(Series II) 811-04972 Xxxxxxxxx Developing Markets
Yes Securities Fund
333-101954 CLASS 2 SHARES:
HL-VA03 Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
9
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------------
22 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Outlook Insurance Company Sep. Acct. 7 Franklin Strategic Income Securities
Insurance Variable Annuity Yes Fund
Company (Series II) 811-09295 Xxxxxxxxx Developing Markets Securities
Yes Fund
333-101955 CLASS 2 SHARES:
LA-VA03 Franklin Income Securities Fund
Franklin Large Cap Growth Securities
Fund
Franklin Rising Dividends Securities
Fund
Franklin Small Cap Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
10
SCHEDULE F
RULE 12B-1 PLANS
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
PORTFOLIO NAME MAXIMUM ANNUAL PAYMENT RATE
---------------------------------------------------------------------------------------------------
Franklin Income Securities Fund -- Class 2 0.25%
Franklin Large Cap Growth Securities Fund -- Class 2 0.25%
Franklin Real Estate Fund -- Class 2 0.25%
Franklin Rising Dividends Securities Fund -- Class 2 0.25%
Franklin Small Cap Fund -- Class 2 0.25%
Mutual Discovery Securities Fund -- Class 2 0.25%
Mutual Shares Securities Fund -- Class 2 0.25%
Xxxxxxxxx Foreign Securities Fund -- Class 2 0.25%
Xxxxxxxxx Global Asset Allocation Fund -- Class 2 0.25%
Xxxxxxxxx Growth Securities Fund -- Class 2 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service which is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under NASD rules. Your
acceptance of such compensation is your acknowledgment that eligible services
have been rendered. All Rule 12b-1 fees, shall be based on the value of Eligible
Shares owned by the Company on behalf of its Accounts, and shall be calculated
on the basis and at the rates set forth in the Compensation Schedule stated
above. The aggregate annual fees paid pursuant to each Plan shall not exceed the
amounts stated as the "annual maximums" in the Portfolio's prospectus, unless an
increase is
11
approved by shareholders as provided in the Plan. These maximums shall be a
specified percent of the value of a Portfolio's net assets attributable to
Eligible Shares owned by the Company on behalf of its Accounts (determined in
the same manner as the Portfolio uses to compute its net assets as set forth in
its effective Prospectus). The Rule 12b-1 fee will be paid to you within thirty
(30) days after the end of the three-month periods ending in January, April,
July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written report of the amounts expended under the
Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
12
AMENDMENT TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"), Franklin
Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the Trust,
"we" or "us") and Hartford Life Insurance Company and Hartford Life and Annuity
Insurance Company (together, "you") and Hartford Securities Distribution
Company, Inc., your distributor, on your behalf and on behalf of certain
Accounts, have previously entered into a Participation Agreement dated May 1,
2000 (the "Agreement"). The parties now desire to amend the Agreement in this
amendment (the "Amendment").
The purpose of the Amendment is to document the intentions of the parties to
communicate, process and settle purchase and redemptions for shares
(collectively, "share transactions") via the Fund/SERV and Networking systems of
the National Securities Clearing Corporation ("NSCC").
For purposes of this Amendment, "Fund/SERV" shall mean NSCC's Mutual Fund
Settlement, Entry and Registration Verification System, a system for automated,
centralized processing of mutual fund purchase and redemption orders,
settlement, and account registration; "Networking" shall mean NSCC's system that
allows mutual funds and life insurance companies to exchange account level
information electronically; and "Settling Bank" shall mean the entity appointed
by the Trust or you, as applicable, to perform such settlement services on
behalf of the Trust and you, as applicable, which entity agrees to abide by
NSCC's then current rules and procedures insofar as they relate to same day
funds settlement. In all cases, processing and settlement of share transactions
shall be done in a manner consistent with applicable law.
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1
1. In lieu of applicable provisions set forth in Section 3 of the Agreement,
the parties agree to provide pricing information, execute orders and wire
payments for purchases and redemptions through NSCC and its subsidiary systems,
and such activities will be governed by the provisions set forth in this
Amendment as follows:
1.1 We will furnish to you through NSCC's Networking or Mutual Fund
Profile System: (i) the most current net asset value information for each
Portfolio; (ii) a schedule of anticipated dividend and distribution payment
dates for each Portfolio, which is subject to change without prior notice,
ordinary income and capital gain dividend rates on the Portfolio's ex-date;
and (iii) in the case of fixed income funds that declare daily dividends,
the daily accrual or the interest rate factor. All such information shall
be furnished to you by 6:30 p.m. Eastern Time on each Business Day or at
such other time as that information becomes available.
1.2 Upon receipt of Portfolio purchase, exchange and redemption
instructions for acceptance as of the time at which a Portfolio's net asset
value is calculated as specified in such Portfolio's prospectus ("close of
trading") on each Business Day ("Instructions"), and upon your
determination that there are good funds with respect to Instructions
involving the purchase of shares, you will calculate the net purchase or
redemption order for each Portfolio.
1.3 On each Business Day, you shall aggregate all purchase and redemption
orders for shares of a Portfolio that you received prior to the close of
trading. Orders for net purchases or net redemptions derived from
Instructions received by you prior to the close of trading on any given
Business Day will be sent to Fund/SERV by 6:00 a.m. Eastern Time, 3:00 a.m.
Pacific Time, on the next Business Day. Subject to your compliance with the
foregoing, you will be considered the designee of the Underwriter and the
Portfolios, and the Business Day on which Instructions are received by you
in proper form prior to the close of trading will be the date as of which
shares of the Portfolios are deemed purchased, exchanged or redeemed
pursuant to such Instructions. Instructions received in proper form by you
after the close of trading on any given Business Day shall not be
transmitted to NSCC prior to the following Business Day and will be treated
as if received on the next following Business Day. Dividends and capital
gain distributions will be automatically reinvested at net asset value in
accordance with the Portfolio's then current prospectuses.
1.4 All orders are subject to acceptance by Underwriter and become
effective only upon confirmation by Underwriter. Underwriter reserves the
right: (i) not to accept any specific order for the purchase or exchange of
shares through Fund/SERV; and (ii) to require any redemption order to be
settled outside of Fund/SERV, in which case the order shall not be
"confirmed" by Underwriter, but rather shall be accepted for redemption in
accordance with Section 3.7 of the Agreement.
2
1.5 All trades placed through Fund/SERV and confirmed by Underwriter via
Fund/SERV shall settle in accordance with Underwriter's profile within
Fund/SERV applicable to you. Underwriter agrees to provide you with account
positions and activity data relating to share transactions via Networking.
1.6 You will wire payment for net purchase orders by the Trust's NSCC Firm
Number, in immediately available funds, to an NSCC settling bank account
designated by you in accordance with NSCC rules and procedures on the same
Business Day such purchase orders are communicated to NSCC. For purchases
of shares of daily dividend accrual funds, those shares will not begin to
accrue dividends until the day the payment for those shares is received.
1.7 NSCC will wire payment for net redemption orders by the Trust, in
immediately available funds, to an NSCC settling bank account designated by
you in accordance with NSCC rules and procedures on the Business Day such
redemption orders are communicated to NSCC, except as provided in the
Trust's prospectus and statement of additional information.
1.8 If on any specific day you or Underwriter are unable to meet the NSCC
deadline for the transmission of purchase or redemption orders for that
day, a party may at its option transmit such orders and make such payments
for purchases and redemptions directly to you or us, as applicable, as is
otherwise provided in the Agreement; provided, however, that we must
receive written notification from you by 6:00 a.m. Pacific time on any day
that you wish to transmit such orders and/or make such payments directly to
us.
1.9 In the event that you or we are unable to or prohibited from
electronically communicating, processing or settling share transactions via
Fund/SERV, you or we shall notify the other, including providing the
notification provided in Section 1.8 , above. After all parties have been
notified, you and we shall submit orders using manual transmissions as is
otherwise provided in the Agreement.
1.10 These procedures are subject to any additional terms in each
Portfolio's prospectus and the requirements of applicable law. The Trust's
Board of Trustees ("Trustees") may refuse to sell shares of any Portfolio
to any person, or may suspend or terminate the offering of shares of any
Portfolio if such action is required by law or regulatory authorities
having jurisdiction or if, in the sole discretion of the Trustees, they
deem such action to be in the best interests of the shareholders of such
Portfolio.
2. New Section 2.4.3 of the Agreement is hereby added as follows:
2.4.3. You and Underwriter represent and warrant that each: (a) has
entered into an agreement with NSCC; (b) has met and will continue to meet
all of the requirements to participate in Fund/SERV and Networking; (c)
intends to remain at all times in compliance with the then current rules
and procedures of NSCC, all to the
3
extent necessary or appropriate to facilitate such communications,
processing, and settlement of share transactions; and (d) will notify the
other party if there is a change in or a pending failure with respect to
its agreement with NSCC.
3. A new Section 7.1.5 is hereby added to the Agreement as follows:
7.1.5 In consideration for orders for the purchase, exchange or sale of
shares of the Portfolios communicated by you by way of Fund/SERV, you shall
further indemnify and hold harmless Indemnified Parties from and against
all Losses that may arise in connection with any orders for the purchase,
exchange or sale of shares of the Portfolios communicated by you or your
agents by way of Fund/SERV, including but not limited to Losses resulting
from Instructions involving investment in incorrect Portfolios or any
fraudulent or unauthorized transaction by either you or your Contract owner
through no fault of the Indemnified Parties. You shall also reimburse the
Trust and Underwriter for any legal or other expenses reasonably incurred
by them in connection with investigating or defending against such Losses.
This indemnity agreement is in addition to any other liability that you may
otherwise have.
Effective Date of this Amendment: January 20, 2004.
4
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment.
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President and Director,
Retail Product Management Group
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President and Director,
Retail Product Management Group
Distributor for the Company HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By: /s/ Xxxxxx X. Xxx
------------------------------------
Name: Xxxxxx X. Xxx
Title: Controller
The Trust: FRANKLIN XXXXXXXXX VARIABLE INSURANCE
PRODUCTS TRUST
ONLY ON BEHALF OF
EACH PORTFOLIO LISTED
ON SCHEDULE C OF
THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
5
AMENDMENT TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (together, "you") and Hartford Securities Distribution
Company, Inc., your distributor, on your behalf and on behalf of certain
Accounts, have previously entered into a Participation Agreement dated May 1,
2000 (the "Agreement"). The parties now desire to amend the Agreement in this
Amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Schedules C, D and F of the Agreement are deleted and replaced in their
entirety with the Schedules C, D and F attached hereto, respectively.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
This Amendment is executed effective as of May 2, 2005.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxx Xxxxx
-----------------------------
Name: Xxxxx Xxxxx
Title: President
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
Distributor for the Company: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By: /s/ Xxxxxx Xxx
-----------------------------
Name: Xxxxxx Xxx
Title: Chief Compliance Officer
2
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
----------------------------------------------------------------------------------------------------------------
Franklin Flex Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Income Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Large Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Large Cap Value Securities Fund -- Class 2 Franklin Advisory Services, LLC
Franklin Real Estate Fund -- Class 2 Franklin Advisers, Inc.
Franklin Rising Dividends Securities Fund -- Class 2 Franklin Advisory Services, LLC
Franklin Small-Mid Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Strategic Income Securities Fund -- Class 1 Franklin Advisers, Inc.
Mutual Discovery Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Mutual Shares Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Templeton Developing Markets Securities Fund -- Class 1 Xxxxxxxxx Asset Management Ltd.
Templeton Foreign Securities Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Global Asset Allocation Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund -- Class 2 Xxxxxxxxx Global Advisors Limited
3
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------------------
1. Hartford Life Hartford Leaders Hartford Life and CLASS 1 SHARES:
and Annuity Access Variable Annuity Insurance Franklin Strategic Income Securities Fund
Insurance Annuity (no CDSC) Company Sep.Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company Yes Yes CLASS 2 SHARES:
333-76425 811-09295 Franklin Flex Cap Growth Securities Fund
LA-NCDSC99 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Foreign Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
2. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Access Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (no CDSC) Yes Xxxxxxxxx Developing Markets Securities Fund
Yes 811-04972 CLASS 2 SHARES:
333-70153 Franklin Flex Cap Growth Securities Fund
HL-NCDSC99 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Foreign Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
3. Hartford Life Hartford Leaders Hartford Life and CLASS 1 SHARES:
and Annuity Access Variable Annuity Insurance Franklin Strategic Income Securities Fund
Insurance Annuity (Series Company Sep. Acct. 7 CLASS 2 SHARES:
Company II-III) Yes Franklin Flex Cap Growth Securities Fund
Yes 811-09295 Franklin Income Securities Fund
333-101936 Franklin Large Cap Growth Securities Fund
LA-NCDSC03 Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
4
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
------------------------------------------------------------------------------------------------------------------------
4. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Access Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (Series Yes CLASS 2 SHARES:
II-III) 811-04972 Franklin Flex Cap Growth Securities Fund
Yes Franklin Income Securities Fund
333-101937 Franklin Large Cap Growth Securities Fund
HL-NCDSC03 Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities
Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
5. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Edge Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (front end Sep.Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company sales load) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-76423 Franklin Income Securities Fund
LA-ASHARE98 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Foreign Securities Fund
Templeton Global Asset Allocation Fund
Templeton Growth Securities Fund
6. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Edge Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (front end Yes Xxxxxxxxx Developing Markets Securities Fund
sales load) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-68463 Franklin Income Securities Fund
HL-ASHARE98 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Templeton Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
5
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
------------------------------------------------------------------------------------------------------------------------
7. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Edge Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (Series Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company II-III) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-101943 Franklin Income Securities Fund
LA-ASHARE03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
8. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Edge Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (Series Yes Xxxxxxxxx Developing Markets Securities Fund
II-III) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-101942 Franklin Income Securities Fund
HL-ASHARE03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
9. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Outlook Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (3-year Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company CDSC) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-40410 Franklin Income Securities Fund
LA-VA00 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
6
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
------------------------------------------------------------------------------------------------------------------------
10. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Outlook Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (3-year Yes Xxxxxxxxx Developing Markets Securities Fund
CDSC) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-40414 Franklin Income Securities Fund
HL-VA00 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
11. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Outlook Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (Series Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company II-III) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-101955 Franklin Income Securities Fund
LA-VA03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
12. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Outlook Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (Series Yes Xxxxxxxxx Developing Markets Securities Fund
II-III) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-101954 Franklin Income Securities Fund
HL-VA03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
7
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
------------------------------------------------------------------------------------------------------------------------
13. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Plus Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (payment Sep.Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company enhancement) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-91921 Franklin Income Securities Fund
LA-VAXC99 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
14. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Plus Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (payment Yes Xxxxxxxxx Developing Markets Securities Fund
enhancement) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-91927 Franklin Income Securities Fund
HL-VAXC99 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
15. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Plus Variable Insurance Company Franklin Strategic Income Securities Fund
Insurance Annuity (Series Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company II-III) Yes CLASS 2 SHARES:
Yes 811-09295 Franklin Flex Cap Growth Securities Fund
333-101949 Franklin Income Securities Fund
LA-VAXC03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
8
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
16. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Plus Variable Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Annuity (Series Yes Xxxxxxxxx Developing Markets Securities Fund
II-III) 811-04972 CLASS 2 SHARES:
Yes Franklin Flex Cap Growth Securities Fund
333-101948 Franklin Income Securities Fund
HL-VAXC03 Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
17. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity Insurance Company Franklin Strategic Income Securities Fund
Insurance Yes Sep.Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company 333-76419 Yes CLASS 2 SHARES:
LA-VA99 811-09295 Franklin Flex Cap Growth Securities Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
18. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities Fund
333-69475 811-04972 CLASS 2 SHARES:
HL-VA99 Franklin Flex Cap Growth Securities Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund.
9
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
19. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Annuity Insurance Company Franklin Strategic Income Securities Fund
Insurance (Series II-III) Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company Yes Yes CLASS 2 SHARES:
333-101933 811-09295 Franklin Flex Cap Growth Securities Fund
LA-VA03 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
20. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company (Series II-III) Yes Xxxxxxxxx Developing Markets Securities Fund
Yes 811-04972 CLASS 2 SHARES:
333-101932 Franklin Flex Cap Growth Securities Fund
HL-VA03 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Growth Securities Fund
21. Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Vision ("Wrap") Insurance Company Franklin Strategic Income Securities Fund
Insurance Variable Annuity Sep. Acct. 7 Xxxxxxxxx Developing Markets Securities Fund
Company Yes Yes CLASS 2 SHARES:
333-95785 811-09295 Franklin Flex Cap Growth Securities Fund
LA-NCDSC99 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
10
PRODUCT NAME
REGISTERED Y/N SEPARATE ACCOUNT NAME
INSURANCE 1933 ACT #, REGISTERED Y/N
# COMPANY STATE FORM ID 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
22. Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Vision ("Wrap") Company Sep. Acct. 7 Franklin Strategic Income Securities Fund
Company Variable Annuity Yes Xxxxxxxxx Developing Markets Securities Fund
Yes 811-04972 CLASS 2 SHARES:
333-36138 Franklin Flex Cap Growth Securities Fund
HL-NCDSC99 Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund
Franklin Large Cap Value Securities Fund
Franklin Real Estate Fund
Franklin Rising Dividends Securities Fund
Franklin Small-Mid Cap Growth Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Asset Allocation Fund
Xxxxxxxxx Growth Securities Fund
11
SCHEDULE F
RULE 12B-1 PLANS
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
MAXIMUM ANNUAL
PORTFOLIO NAME PAYMENT RATE
--------------------------------------------------------------------------------
Franklin Flex Cap Growth Securities Fund 0.25%
Franklin Income Securities Fund 0.25%
Franklin Large Cap Growth Securities Fund 0.25%
Franklin Large Cap Value Securities Fund 0.25%
Franklin Real Estate Fund 0.25%
Franklin Rising Dividends Securities Fund 0.25%
Franklin Small-Mid Cap Growth Securities Fund 0.25%
Mutual Discovery Securities Fund 0.25%
Mutual Shares Securities Fund 0.25%
Xxxxxxxxx Foreign Securities Fund 0.25%
Xxxxxxxxx Global Asset Allocation Fund 0.25%
Xxxxxxxxx Growth Securities Fund 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service which is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under NASD rules. Your
acceptance of such compensation is your acknowledgment that eligible services
have been rendered. All Rule 12b-1 fees, shall be based on the value of Eligible
Shares owned by the Company on behalf of its Accounts, and shall be calculated
on the basis and at the rates set forth in the Compensation Schedule stated
above. The aggregate annual fees paid pursuant to each Plan shall not exceed the
amounts stated as the "annual maximums" in the Portfolio's prospectus, unless an
increase is approved by shareholders as provided in the Plan. These
12
maximums shall be a specified percent of the value of a Portfolio's net assets
attributable to Eligible Shares owned by the Company on behalf of its Accounts
(determined in the same manner as the Portfolio uses to compute its net assets
as set forth in its effective Prospectus). The Rule 12b-1 fee will be paid to
you within thirty (30) days after the end of the three-month periods ending in
January, April, July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written report of the amounts expended under the
Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
13
AMENDMENT TO PARTICIPATION AGREEMENT
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company (Leaders)
Hartford Life and Annuity Insurance Company
Hartford Securities Distribution Company, Inc
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company (Leaders) and Hartford
Life and Annuity Insurance Company (together the "Company" or "you"), and
Hartford Securities Distribution Company, Inc, your distributor, on your behalf
and on behalf of certain Accounts, have previously entered into a Participation
Agreement dated May 1, 2000, as amended (the "Agreement"). The parties now
desire to amend the Agreement by this amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 1 and Section 2.2.1 are hereby each amended to reflect that
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust") is
organized as a statutory trust under the laws of the State of Delaware,
effective as of May 1, 2007.
2. Section 3.1.3 is amended and restated in its entirety as follows:
"3.1.3 We agree that shares of the Trust will be sold only to: (i) life
insurance companies which have entered into fund participation agreements
with the Trust ("Participating Insurance Companies") and their separate
accounts or to qualified pension and retirement plans in accordance with
the terms of the Shared Funding Order; and (ii) investment companies in the
form of funds of funds. No shares of any Portfolio will be sold to the
general public."
3. Section 5.2 is amended and restated in its entirety as follows:
"5.2 If and to the extent required by law, you shall: (i) solicit voting
instructions from Contract owners; (ii) vote the Trust shares in accordance
with the instructions received from Contract owners; and (iii) vote Trust
shares owned by subaccounts for which no instructions have been received
from Contract owners in the same proportion as Trust shares of such
Portfolio for which instructions have been received from Contract owners;
so long as and to the extent that the SEC continues to interpret the 1940
Act to require pass-through voting privileges for variable contract owners.
You reserve the right to vote Trust shares held in any Account in your own
right, to the extent permitted by law."
4. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of June 5, 2007.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxxx Xxxxxx
------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
The Company: HARTFORD LIFE INSURANCE COMPANY
(LEADERS)
By: /s/ Xxxxxx Xxxxx
------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxx Xxxxx
------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC
By: /s/ Xxxxxx Xxxxx
------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
2
AMENDMENT 5 TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (together, "you") and Hartford Securities Distribution
Company, Inc., your distributor, on your behalf and on behalf of certain
Accounts, have previously entered into a Participation Agreement dated May 1,
2000 and subsequently amended May 1, 2003, January 20, 2004, May 2, 2005 and
June 5, 2007 (the "Agreement"). The parties now desire to amend the Agreement by
this Amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 2.3.2 is amended and restated in its entirety as follows:
"2.3.2 Each investment adviser (each, an "Adviser") of a Portfolio, as
indicated in the current prospectus of the Portfolio, is duly registered as
an investment adviser under the Investment Advisers Act of 1940, as
amended, or exempt from such registration."
2. The term "National Association of Securities Dealers, Inc. (the "NASD") is
hereby replaced with "Financial Industry Regulatory Authority ("FINRA")"
throughout the Agreement in sections 2.1.6, 2.3.1, 10.7, 10.8 and Schedule
F, respectively.
3. Schedules B, C, D and F of the Agreement are deleted and replaced in their
entirety with the Schedules B, C, D and F attached hereto, respectively.
4. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 1, 2008.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Xxxxx X. Xxxxxxxx,
Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------
Xxxxxx Xxxxxx, Senior Vice
President
The Company: HARTFORD LIFE INSURANCE COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
Distributor for the Company: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
2
SCHEDULE B
ACCOUNTS OF THE COMPANY
SEC REGISTRATION
NAME OF ACCOUNT YES/NO
-------------------------------------------------------------------------
Hartford Life Insurance Company Separate Account Seven Yes
Hartford Life and Annuity Insurance Company Separate Yes
Account Seven
3
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST
Franklin Flex Cap Growth Securities Fund -- Class 2 and Class 4
Franklin Income Securities Fund -- Class 2 and Class 4
Franklin Large Cap Growth Securities Fund -- Class 2
Franklin Large Cap Value Securities Fund -- Class 2
Franklin Global Real Estate Securities Fund -- Class 2
Franklin Rising Dividends Securities Fund -- Class 2
Franklin Small-Mid Cap Growth Securities Fund -- Class 2 and Class 4
Franklin Small Cap Value Securities Fund -- Class 2 and Class 4
Franklin Strategic Income Securities Fund -- Class 1, Class 2 and Class 4
Mutual Discovery Securities Fund -- Class 2 and Class 4
Mutual Shares Securities Fund -- Class 2 and Class 4
Xxxxxxxxx Developing Markets Securities Fund -- Class 1, Class 2 and Class 4
Xxxxxxxxx Foreign Securities Fund -- Class 2 and Class 4
Templeton Global Asset Allocation Fund -- Class 2
Xxxxxxxxx Global Income Securities Fund -- Class 2 and Class 4
Xxxxxxxxx Growth Securities Fund -- Class 2 and Class 4
4
SCHEDULE D
CONTRACTS OF THE COMPANY
Hartford Leaders (all series)
Hartford Leaders Access (all series)
Hartford Leaders Outlook (all series)
Hartford Leaders Plus (all series)
Hartford Leaders Edge (all series)
Hartford Leaders Vision (all series)
Hartford Leaders Foundation (all series)
Hartford Leaders Foundation Edge (all series)
The Director (all series)
5
SCHEDULE F
RULE 12b-1 PLANS OF THE TRUST
COMPENSATION
Each Class 2 Portfolio named or referenced on Schedule C of this Agreement shall
pay a maximum annual payment rate of 0.25% stated as a percentage per year of
that Portfolio's Class 2 average daily net assets, pursuant to the terms and
conditions of its Class 2 Rule 12b-1 distribution plan. Each Class 4 Portfolio
named or referenced on Schedule C of this Agreement shall pay a maximum annual
payment rate of 0.35% stated as a percentage per year of that Portfolio's Class
4 average daily net assets, pursuant to the terms and conditions of its Class 4
Rule 12b-1 distribution plan.
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") that are subject to a Rule 12b-1 plan adopted under the 1940
Act (the "Plan"), the Company on behalf of its Distributor, may participate in
the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service that is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under FINRA rules.
Your acceptance of such compensation is your acknowledgment that eligible
services have been rendered. All Rule 12b-1 fees, shall be based on the value of
Eligible Shares owned by the Company on behalf of its Accounts, and shall be
calculated on the basis and at the rates set forth in the compensation provision
stated above. The aggregate annual fees paid pursuant to each Plan shall not
exceed the amounts stated as the "annual maximums" in the Portfolio's
prospectus, unless an increase is approved by shareholders as provided in the
Plan. These maximums shall be a specified percent of the value of a Portfolio's
net assets attributable to Eligible Shares owned by the Company on behalf of its
Accounts (determined in the same manner as the Portfolio uses to compute its net
assets as set forth in its effective Prospectus). The Rule 12b-1 fee will be
paid to you within thirty (30) days after the end of the three-month periods
ending in January, April, July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written
6
report of the amounts expended under the Plans and the purposes for which such
expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty, or as provided in the
Plan. Continuation of the Plans is also conditioned on Disinterested Trustees
being ultimately responsible for selecting and nominating any new Disinterested
Trustees. Under Rule 12b-1, the Trustees have a duty to request and evaluate,
and persons who are party to any agreement related to a Plan have a duty to
furnish, such information as may reasonably be necessary to an informed
determination of whether the Plan or any agreement should be implemented or
continued. Under Rule 12b-1, the Trust is permitted to implement or continue
Plans or the provisions of any agreement relating to such Plans from
year-to-year only if, based on certain legal considerations, the Trustees are
able to conclude that the Plans will benefit each affected Trust Portfolio and
class. Absent such yearly determination, the Plans must be terminated as set
forth above. In the event of the termination of the Plans for any reason, the
provisions of this Schedule F relating to the Plans will also terminate. You
agree that your selling agreements with persons or entities through whom you
intend to distribute Contracts will provide that compensation paid to such
persons or entities may be reduced if a Portfolio's Plan is no longer effective
or is no longer applicable to such Portfolio or class of shares available under
the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency. You agree to provide complete disclosure as required by all
applicable statutes, rules and regulations of all rule 12b-1 fees received from
us in the prospectus of the Contracts.
7
AMENDMENT 6 TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (together, "you") and Hartford Securities Distribution
Company, Inc., your distributor, on your behalf and on behalf of certain
Accounts, have previously entered into a Participation Agreement dated May 1,
2000 and subsequently amended May 1, 2003, January 20, 2004, May 2, 2005, June
5, 2007, and May 1, 2008 (the "Agreement"). The parties now desire to amend the
Agreement by this Amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Schedules C and D of the Agreement are deleted and replaced in their
entirety with the Schedules C and D attached hereto.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of October 19, 2009.
The Trust: FRANKLIN XXXXXXXXX VARIABLE INSURANCE
PRODUCTS TRUST
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
The Company: HARTFORD LIFE INSURANCE COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
----------------------------------
Name: Xxxxxx Xxxxx
Title: Executive Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
----------------------------------
Name: Xxxxxx Xxxxx
Title: Executive Vice President
Distributor for the Company: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
----------------------------------
Name: Xxxxxx Xxxxx
Title: Executive Vice President
2
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST
Franklin Flex Cap Growth Securities Fund -- Class 2 and Class 4
Franklin Income Securities Fund -- Class 2 and Class 4
Franklin Large Cap Growth Securities Fund -- Class 2
Franklin Large Cap Value Securities Fund -- Class 2
Franklin Global Real Estate Securities Fund -- Class 2
Franklin Rising Dividends Securities Fund -- Class 2 and Class 4
Franklin Small-Mid Cap Growth Securities Fund -- Class 2 and Class 4
Franklin Small Cap Value Securities Fund -- Class 2 and Class 4
Franklin Strategic Income Securities Fund -- Class 1, Class 2 and Class 4
Mutual Global Discovery Securities Fund -- Class 2 and Class 4
Mutual Shares Securities Fund -- Class 2 and Class 4
Xxxxxxxxx Developing Markets Securities Fund -- Class 1, Class 2 and Class 4
Xxxxxxxxx Foreign Securities Fund -- Class 2 and Class 4
Templeton Global Asset Allocation Fund -- Class 2
Xxxxxxxxx Global Bond Securities Fund -- Class 2 and Class 4
Xxxxxxxxx Growth Securities Fund -- Class 2 and Class 4
3
SCHEDULE D
CONTRACTS OF THE COMPANY
Hartford Leaders B-Share (Core) (all series)
Hartford Leaders C-Share (Access) (all series)
Hartford Leaders Outlook (all series)
Hartford Leaders Plus (all series)
Hartford Leaders A-Share (Edge) (all series)
Hartford Leaders I-Share (Advisory) (all series)
Hartford Leaders Vision (all series)
Hartford Leaders Foundation (all series)
Hartford Leaders Foundation Edge (all series)
The Director (all series)
4
AMENDMENT NO. 7 TO
PARTICIPATION AGREEMENT -- HARTFORD LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
Hartford Securities Distribution Company, Inc
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (together the "Company" or "you"), and Hartford
Securities Distribution Company, Inc, your distributor, on your behalf and on
behalf of certain Accounts, have previously entered into a Participation
Agreement dated May 1, 2000, and subsequently amended May 1, 2003, January 20,
2004, May 2, 2005, June 5, 2007, May 1, 2008 and October 19, 2009 (the
"Agreement"). The parties now desire to amend the Agreement by this amendment
(the "Amendment"). Unless otherwise indicated, the terms defined in the
Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 6 is amended and restated in its entirety as set forth in
Attachment A to this Amendment.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of September 22, 2010.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
The Company: HARTFORD LIFE INSURANCE COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title:
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title:
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title:
2
ATTACHMENT A
6. SALES MATERIAL, INFORMATION AND TRADEMARKS
6.1 For purposes of this Section 6, "Sales Literature/ Promotional Material"
includes, but is not limited to, portions of the following that use any logo or
other trademark related to the Trust, or Underwriter or its affiliates, or refer
to the Trust: advertisements (such as material published or designed for use in
a newspaper, magazine or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures, web-sites
and other electronic communications or other public media), sales literature
(i.e., any written communication distributed or made generally available to
customers or the public, including brochures, circulars, research reports,
market letters, form letters, seminar texts, reprints or excerpts or any other
advertisement, sales literature or published article or electronic
communication), educational or training materials or other communications
distributed or made generally available to some or all agents or employees in
any media, and disclosure documents, shareholder reports and proxy materials.
6.2 You may use the name of the Trust and trademarks and the logo of the
Underwriter in Sales Literature/Promotional Material as reasonably necessary to
carry out your performance and obligations under this Agreement provided that
you comply with the provisions of this Agreement. You agree to abide by any
reasonable use guidelines regarding use of such trademarks and logos that we may
give from time to time. You shall, as we may request from time to time, promptly
furnish, or cause to be furnished to us or our designee, at least one complete
copy of each registration statement, prospectus, statement of additional
information, private placement memorandum, retirement plan disclosure
information or other disclosure documents or similar information, as applicable
(collectively "Disclosure Documents"), as well as any report, solicitation for
voting instructions, Sales Literature/ Promotional Material created and approved
by you, and all amendments to any of the above that relate to the Contracts, the
Accounts, the Trust, or Underwriter or its affiliates.
6.3 You and your agents shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust,
the Underwriter or an Adviser, other than information or representations
contained in and accurately derived from the registration statement or
prospectus for the Trust shares (as such registration statement and prospectus
may be amended or supplemented from time to time), annual and semi-annual
reports of the Trust, Trust-sponsored proxy statements, or in Sales
Literature/Promotional Material created by us for the Trust and provided by the
Trust or its designee to you, except as required by legal process or regulatory
authorities or with the written permission of the Trust or its designee.
6.4 You agree, represent and warrant that you are solely responsible for any
Sales Literature/ Promotional Material prepared by you and that such material
will: (a) conform to all requirements of any applicable laws or regulations of
any government or authorized agency having jurisdiction over the offering or
sale of shares of the Portfolios or Contracts; (b) be solely based upon and not
contrary to or inconsistent with the information or materials
3
provided to you by us or a Portfolio; and (c) be made available promptly to us
upon our request. You agree to file any Sales Literature/Promotional Material
prepared by you with FINRA, or other applicable legal or regulatory authority,
within the timeframes that may be required from time to time by FINRA or such
other legal or regulatory authority. Unless otherwise expressly agreed to in
writing, it is understood that we will neither review nor approve for use any
materials prepared by you and will not be materially involved in the preparation
of, or have any responsibility for, any such materials prepared by you. You are
not authorized to modify or translate any materials we have provided to you.
6.5 You shall promptly notify us of any written customer complaint or notice of
any regulatory investigation or proceeding received by you relating to any
Disclosure Documents or Sales Literature/Promotional Material that reference the
Trust or a Portfolio.
6.6 We shall not give any information or make any representations or statements
on behalf of you or concerning you, the Accounts or the Contracts other than
information or representations, including naming you as a Trust shareholder,
contained in and accurately derived from Disclosure Documents for the Contracts
(as such Disclosure Documents may be amended or supplemented from time to time),
or in materials approved by you for distribution, including Sales Literature/
Promotional Material, except as required by legal process or regulatory
authorities or with your written permission.
6.7 Except as provided in Section 6.2, you shall not use any designation
comprised in whole or part of the names or marks "Franklin" or "Xxxxxxxxx" or
any logo or other trademark relating to the Trust or the Underwriter without
prior written consent, and upon termination of this Agreement for any reason,
you shall cease all use of any such name or xxxx as soon as reasonably
practicable.
6.8 You shall furnish to us ten (10) Business Days prior to its first
submission to the SEC or its staff, any request or filing for no-action
assurance or exemptive relief naming, pertaining to, or affecting, the Trust,
the Underwriter or any of the Portfolios.
6.9 You agree that any posting of Designated Portfolio Documents on your
website or use of Designated Portfolio Documents in any other electronic format
will result in the Designated Portfolio Documents: (i) appearing identical to
the hard copy printed version or .pdf format file provided to you by us (except
that you may reformat .pdf format prospectus files in order to delete blank
pages and to insert .pdf format prospectus supplement files provided by us to
you); (ii) being clearly associated with the particular Contracts in which they
are available; (iii) having no less prominence than prospectuses of any other
underlying funds available under the Contracts; and (iv) being used in an
authorized manner. Notwithstanding the above, you understand and agree that you
are responsible for ensuring that participation in the Portfolios, and any
website posting, or other use, of the Designated Portfolio Documents is in
compliance with this Agreement, including Section 4.6 of the Agreement. We
reserve the right to inspect and review your website if any Designated Portfolio
Documents and/or other Trust documents are posted on your website and you shall,
upon our reasonable request, provide us timely access to your website materials
to perform such inspection and review.
4
In addition, you agree to be solely responsible for maintaining and updating the
Designated Portfolio Documents' .pdf files, to the extent that revised
Designated Portfolio Documents are made available to you, and removing and/or
replacing promptly any outdated prospectuses and other documents, as necessary,
ensuring that any accompanying instructions by us, for using or stopping use,
are followed. You agree to designate and make available to us a person to act as
a single point of communication contact for these purposes. We are not
responsible for any additional costs or additional liabilities that may be
incurred as a result of your election to place the Designated Portfolio
Documents on your website. We reserve the right to revoke this authorization, at
any time and for any reason, although we may instead make our authorization
subject to new procedures.
5
AMENDMENT NO. 8 TO
PARTICIPATION AGREEMENT -- LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
and
Hartford Securities Distribution Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (the "Company" or "you"), and Hartford Securities
Distribution Company, your distributor, on your behalf and on behalf of certain
Accounts, have previously entered into a Participation Agreement dated May 1,
2000, and subsequently amended May 1, 2003, January 20, 2004, May 2, 2005, June
5, 2007, May 1, 2008, October 19, 2009 and September 22, 1010 (the "Agreement").
The parties now desire to amend the Agreement in this amendment (the
"Amendment").
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Schedule D of the Agreement is deleted and replaced in entirety with the
Schedule D attached hereto.
Except as modified hereby, all other terms and provisions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
This Amendment may be executed simultaneously in two or more counterparts, each
of which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 2, 2011.
The Trust: FRANKLIN XXXXXXXXX VARIABLE INSURANCE
PRODUCTS TRUST
ONLY ON BEHALF OF
EACH PORTFOLIO LISTED
ON SCHEDULE C OF
THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
1
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
2
SCHEDULE D
CONTRACTS OF THE COMPANY
Hartford's Personal Retirement Manager I-Share (all series)
Hartford Leaders B-Share (Core) (all series)
Hartford Leaders C-Share (Access) (all series)
Hartford Leaders Outlook (all series)
Hartford Leaders Plus (all series)
Hartford Leaders A-Share (all series)
Hartford Leaders Vision (all series)
Hartford Leaders Foundation Edge (all series)
The Director (all series)
3
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
As of May 1, 2000
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
CONTENTS
SECTION SUBJECT MATTER
---------------------------------------------------------------------------------------------------------------
1. Parties and Purpose
2. Representations and Warranties
3. Purchase and Redemption of Trust Portfolio Shares
4. Fees, Expenses, Prospectuses, Proxy Materials and Reports
5. Voting
6. Sales Material, Information and Trademarks
7. Indemnification
8. Notices
9. Termination
10. Miscellaneous
SCHEDULES TO THIS AGREEMENT
A. The Company
B. Accounts of the Company
C. Available Portfolios and Classes of Shares of the Trust; Investment Advisers
D. Contracts of the Company
E. This schedule not used.
F. Rule 12b-1 Plans of the Trust
G. Addresses for Notices
H. Shared Funding Order
1. PARTIES AND PURPOSE
This agreement (the "Agreement") is between certain portfolios, specified below
and in Schedule C, of Franklin Xxxxxxxxx Variable Insurance Products Trust, an
open-end management investment company organized as a business trust under
Massachusetts law (the "Trust"), Franklin Xxxxxxxxx Distributors, Inc., a
California corporation which is the principal underwriter for the Trust (the
"Underwriter," and together with the Trust, "we" or "us") and each insurance
company identified on Schedule A ("you"), and your distributor, on your own
behalf and on behalf of each segregated asset account maintained by you that is
listed on Schedule B, as that schedule may be amended from time to time
("Account" or "Accounts").
This Agreement shall create a separate agreement for each insurance company and
each distributor identified on Schedule A of this Agreement ("Company") as
though each Company had separately executed an identical participation agreement
with the Trust and the Underwriter. No rights, responsibilities or liabilities
arising under the Agreement as it pertains to one Company shall be enforceable
by or against any party to the Agreement as it pertains to another Company.
The purpose of this Agreement is to entitle you, on behalf of the Accounts, to
purchase the shares, and classes of shares, of portfolios of the Trust
("Portfolios") that are identified on Schedule C, solely for the purpose of
funding benefits of your variable life insurance policies or variable annuity
contracts ("Contracts") that are identified on Schedule D. This Agreement does
not authorize any other purchases or redemptions of shares of the Trust.
2. REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES BY YOU
You represent and warrant that:
2.1.1 You are an insurance company duly organized and in good
standing under the laws of your state of incorporation.
2.1.2 All of your directors, officers, employees, and other
individuals or entities dealing with the money and/or securities of
the Trust are and shall be at all times covered by a blanket fidelity
bond or similar coverage for the benefit of the Trust, in an amount
not less than $5 million. Such bond shall include coverage for larceny
and embezzlement and shall be issued by a reputable bonding company.
You agree to make all reasonable efforts to see that this bond or
another bond containing such provisions is always in effect, and you
agree to notify us in the event that such coverage no longer applies.
2.1.3 Each Account is a duly organized, validly existing segregated
asset account under applicable insurance law and interests in each
Account are offered exclusively through the purchase of or transfer
into a "variable contract" within the meaning of such terms under
Section 817 of the Internal Revenue Code of 1986, as amended ("Code")
and the regulations thereunder. You will use your best efforts to
continue to meet such definitional requirements, and will notify us
immediately upon having a reasonable basis for believing that such
requirements have ceased to be met or that they might not be met in
the future.
2.1.4 Each Account either: (i) has been registered or, prior to any
issuance or sale of the Contracts, will be registered as a unit
investment trust under the Investment Company Act of 1940 ("1940
Act"); or (ii) has not been so registered in proper reliance upon an
exemption from registration under Section 3(c) of the 1940 Act; if the
Account is exempt from registration as an investment company under
Section 3(c) of the 1940 Act, you will use your best efforts to
maintain such exemption and will notify us immediately upon having a
2
reasonable basis for believing that such exemption no longer applies
or might not apply in the future.
2.1.5 The Contracts or interests in the Accounts: (i) are or, prior
to any issuance or sale will be, registered as securities under the
Securities Act of 1933, as amended (the "1933 Act"); or (ii) are not
registered because they are properly exempt from registration under
Section 3(a)(2) of the 1933 Act or will be offered exclusively in
transactions that are properly exempt from registration under Section
4(2) or Regulation D of the 1933 Act, in which case you will make
every effort to maintain such exemption and will notify us immediately
upon having a reasonable basis for believing that such exemption no
longer applies or might not apply in the future.
2.1.6 The Contracts: (i) will be sold by broker-dealers, or their
registered representatives, who are registered with the Securities and
Exchange Commission ("SEC") under the Securities and Exchange Act of
1934, as amended (the "1934 Act") and who are members ("Members") in
good standing of the National Association of Securities Dealers, Inc.
(the "NASD"); and (ii) will be issued and sold in compliance in all
material respects with all applicable federal and state laws. You have
entered, or will enter into, and will maintain a selling agreement
with each Member through which you intend to distribute the Contracts,
and such selling agreement will provide that each Member will comply
with all applicable federal and state laws, rules and regulations.
2.1.7 Subject to the representations and warranties by the Trust and
the Underwriter at Section 2.2.7 of this Agreement concerning the
qualification of the Trust as a "regulated investment company" under
Sub-Chapter M of the Code and also subject to the representations and
warranties of the Trust and the Underwriter at Section 2.2.8 of this
Agreement concerning the Trust's compliance with the diversification
requirements under Section 817(h) of the Code, the Contracts currently
are and will be treated as annuity contracts or life insurance
contracts under applicable provisions of the Code and you will use
your best efforts to maintain such treatment; you will notify us
immediately upon having a reasonable basis for believing that any of
the Contracts have ceased to be so treated or that they might not be
so treated in the future.
2.1.8 The fees and charges deducted under each Contract, in the
aggregate, are reasonable in relation to the services rendered, the
expenses expected to be incurred, and the risks assumed by you.
2.1.9 You will use shares of the Trust only for the purpose of
funding benefits of the Contracts through the Accounts.
2.1.10 Contracts will not be issued for sale outside of the United
States.
2.1.11 All Accounts shall be registered as investment companies
pursuant to the 1940 Act, unless exempt from such registration.
3
2.2 REPRESENTATIONS AND WARRANTIES BY THE TRUST
The Trust represents and warrants that:
2.2.1 It is duly organized and in good standing under the laws of the
State of Massachusetts.
2.2.2 All of its directors, officers, employees and others dealing
with the money and/or securities of a Portfolio are and shall be at
all times covered by a blanket fidelity bond or similar coverage for
the benefit of the Trust in an amount not less that the minimum
coverage required by Rule 17g-1 or other regulations under the 1940
Act. Such bond shall include coverage for larceny and embezzlement and
be issued by a reputable bonding company.
2.2.3 It is registered as an open-end management investment company
under the 0000 Xxx.
2.2.4 Each class of shares of the Portfolios of the Trust is
registered under the 0000 Xxx.
2.2.5 It will amend its registration statement under the 1933 Act and
the 1940 Act from time to time as required in order to effect the
continuous offering of its shares.
2.2.6 It will comply, in all material respects, with the 1933 and
1940 Acts and the rules and regulations thereunder.
2.2.7 Subject to your representations and warranties at Section 2.1.7
of this Agreement concerning the qualification of the Contracts as
annuity contracts or life insurance contracts under applicable
provisions of the Code, the Trust is currently qualified as a
"regulated investment company" under Subchapter M of the Code, it will
make every effort to maintain such qualification, and will notify you
immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
2.2.8 The Trust will use its best efforts to comply with the
diversification requirements for variable annuity, endowment or life
insurance contracts set forth in Section 817(h) of the Code, and the
rules and regulations thereunder, including without limitation
Treasury Regulation 1.817-5. Upon having a reasonable basis for
believing any Portfolio has ceased to comply and will not be able to
comply within the grace period afforded by Regulation 1.817-5, the
Trust will notify you immediately and will take all reasonable steps
to adequately diversify the Portfolio to achieve compliance.
2.2.9 It currently intends for one or more classes of shares (each, a
"Class") to make payments to finance its distribution expenses,
including service fees, pursuant to a plan ("Plan") adopted under rule
12b-1 under the 1940 Act ("Rule 12b-1"), although it may determine to
discontinue such practice in the future. To the extent that any Class
of the Trust finances its distribution expenses pursuant to a Plan
adopted under rule 12b-1, the Trust undertakes to comply with any then
current SEC interpretations concerning rule 12b-1 or any successor
provisions.
4
2.3 REPRESENTATIONS AND WARRANTIES BY THE UNDERWRITER
The Underwriter represents and warrants that:
2.3.1 It is registered as a broker dealer with the SEC under the 1934
Act, and is a member in good standing of the NASD.
2.3.2 Each investment adviser listed on Schedule C (each, an
"Adviser") is duly registered as an investment adviser under the
Investment Advisers Act of 1940, as amended, and any applicable state
securities law.
2.4 WARRANTIES AND AGREEMENTS BY BOTH YOU AND US
2.4.1 We received an order from the SEC dated November 16, 1993 (file
no. 812-8546), which was amended by a notice and an order we received
on September 17, 1999 and October 13, 1999, respectively (file no.
812-11698) (collectively, the "Shared Funding Order," attached to this
Agreement as Schedule H). The Shared Funding Order grants exemptions
from certain provisions of the 1940 Act and the regulations thereunder
to the extent necessary to permit shares of the Trust to be sold to
and held by variable annuity and variable life insurance separate
accounts of both affiliated and unaffiliated life insurance companies
and qualified pension and retirement plans outside the separate
account context. You and we both warrant and agree that both you and
we will comply with the "Applicants' Conditions" prescribed in the
Shared Funding Order as though such conditions were set forth verbatim
in this Agreement, including, without limitation, the provisions
regarding potential conflicts of interest between the separate
accounts which invest in the Trust and regarding contract owner voting
privileges. In order for the Trust's Board of Trustees to perform its
duty to monitor for conflicts of interest, you agree to inform us of
the occurrence of any of the events specified in condition 2 of the
Shared Funding Order to the extent that such event may or does result
in a material conflict of interest as defined in that order.
2.4.2 As covered financial institutions we, only with respect to
Portfolio shareholders, and you each undertake and agree to comply,
and to take full responsibility in complying with any and all
applicable laws, regulations, protocols and other requirements
relating to money laundering including, without limitation, the
International Money Laundering Abatement and Anti-Terrorist Financing
Act of 2001 (Title III of the USA PATRIOT Act).
3. PURCHASE AND REDEMPTION OF TRUST PORTFOLIO SHARES
3.1 We will make shares of the Portfolios available to the Accounts for
the benefit of the Contracts. The shares will be available for purchase at
the net asset value per share next computed after we (or our agent) receive
a purchase order, as established in accordance with the provisions of the
then current prospectus of the Trust. Notwithstanding the foregoing, the
Trust's Board of Trustees ("Trustees") may refuse to sell shares of any
Portfolio to any person, or may suspend or terminate the offering of shares
of any Portfolio if such action is required by law or by regulatory,
authorities having jurisdiction or if, in the sole discretion of the
Trustees,
5
they deem such action to be in the best interests of the shareholders of
such Portfolio. Without limiting the foregoing, the Trustees have
determined that there is a significant risk that the Trust and its
shareholders may be adversely affected by investors whose purchase and
redemption activity follows a market timing pattern, and have authorized
the Trust, the Underwriter and the Trust's transfer agent to adopt
procedures and take other action (including, without limitation, rejecting
specific purchase orders) as they deem necessary to reduce, discourage or
eliminate market timing activity. You agree to cooperate with us to assist
us in implementing the Trust's restrictions on purchase and redemption
activity that follows a market timing pattern.
3.2 We agree that shares of the Trust will be sold only to life insurance
companies which have entered into fund participation agreements with the
Trust ("Participating Insurance Companies") and their separate accounts or
to qualified pension and retirement plans in accordance with the terms of
the Shared Funding Order. No shares of any Portfolio will be sold to the
general public.
3.3 This section not used.
3.4 You shall be the designee for us for receipt of purchase orders and
requests for redemption resulting from investment in and payments under the
Contracts ("Instructions"). The Business Day on which such Instructions are
received in proper form by you and time stamped by the close of trading
will be the date as of which Portfolio shares shall be deemed purchased,
exchanged, or redeemed as a result of such Instructions. Instructions
received in proper form by you and time stamped after the close of trading
on any given Business Day shall be treated as if received on the next
following Business Day. You warrant that all orders, Instructions and
confirmations received by you which will be transmitted to us for
processing on a Business Day will have been received and time stamped prior
to the Close of Trading on that Business Day. Instructions we receive after
9 a.m. Eastern Time (or up to 9:30 a.m. Eastern Time with prior telephone
notification) shall be processed on the next Business Day. "Business Day"
shall mean any day on which the New York Stock Exchange is open for trading
and on which the Trust calculates its net asset value pursuant to the rules
of the SEC and its current prospectus.
3.5 We shall calculate the net asset value per share of each Portfolio on
each Business Day, and shall communicate these net asset values to you or
your designated agent on a daily basis as soon as reasonably practical
after the calculation is completed (normally by 6:30 p.m. Eastern time).
3.6 You shall submit payment for the purchase of shares of a Portfolio on
behalf of an Account in federal funds transmitted by wire to the Trust or
to its designated custodian, which must receive such wires no later than
the close of the Reserve Bank, which is 6:00 p.m. East Coast time, on the
Business Day following the Business Day as of which such purchases orders
are made.
3.7 We will redeem any full or fractional shares of any Portfolio, when
requested by you on behalf of an Account, at the net asset value next
computed after receipt by us (or our agent) of the request for redemption.
The Trust anticipates that in the ordinary course of
6
business it will make redemptions in cash, however it reserves the right to
make redemptions in kind, in accordance with its prospectus disclosure
(including its statement of additional information). We shall make payment
for such shares in the manner we establish from time to time, but in no
event shall payment be delayed for a greater period than is permitted by
the 1940 Act. Redemption with respect to a Portfolio will be made in
accordance with the prospectus disclosure (including its statement of
additional information) of the Trust, and will normally be paid to the
Company before the close of the Federal Reserve Banks, which is 6:00 p.m.
Eastern time on the next Business Day after the receipt of the request for
redemption. If payment in federal funds for any redemption request is
received by you after such time, the Trust shall promptly upon your written
request, reimburse you for any charges, costs, fees, interest, or other
expenses reasonably incurred by you as a result of such failure to provide
redemption proceeds within the specified time.
3.8 Issuance and transfer of the Portfolio shares will be by book entry
only. Stock certificates will not be issued to you or the Accounts.
Portfolio shares purchased from the Trust will be recorded in the
appropriate title for each Account or the appropriate subaccount of each
Account.
3.9 We shall furnish, on or before the ex-dividend date, notice to you of
any income dividends or capital gain distributions payable on the shares of
any Portfolio. You hereby elect to receive all such income dividends and
capital gain distributions as are payable on shares of a Portfolio in
additional shares of that Portfolio, and you reserve the right to change
this election in the future. We will notify you of the number of shares so
issued as payment of such dividends and distributions.
3.10 Each party to this Agreement agrees that, in the event of a material
error resulting from incorrect information or confirmations, the parties
will seek to comply in all material respects with the provisions of
applicable federal securities laws.
4. FEES, EXPENSES, PROSPECTUSES, PROXY MATERIALS AND REPORTS
4.1 We shall pay no fee or other compensation to you under this Agreement
except as provided on Schedule F, if attached.
4.2 We shall prepare and be responsible for filing with the SEC, and any
state regulators requiring such filing, all shareholder reports, notices,
proxy materials (or similar materials such as voting instruction
solicitation materials), prospectuses and statements of additional
information of the Trust. We shall bear the costs of preparation and filing
of the documents listed in the preceding sentence, registration and
qualification of the Trust's shares of the Portfolios.
4.3 We shall use reasonable efforts to provide you, on a timely basis,
with such information about the Trust, the Portfolios and each Adviser, in
such form as you may reasonably require, as you shall reasonably request in
connection with the preparation of disclosure documents and annual and
semi-annual reports pertaining to the Contracts.
7
4.4 At your option, we shall provide you, at our expense, with either: (i)
for each Contract owner who is invested through the Account in a subaccount
corresponding to a Portfolio ("designated subaccount"), one copy of each of
the following documents on each occasion that such document is required by
law or regulation to be delivered to such Contract owner who is invested in
a designated subaccount: the Trust's current prospectus, annual report,
semi-annual report and other shareholder communications, including any
amendments or supplements to any of the foregoing, pertaining specifically
to the Portfolios ("Designated Portfolio Documents"); or (ii) a camera
ready copy of such Designated Portfolio Documents in a form suitable for
printing and from which information relating to series of the Trust other
than the Portfolios has been deleted to the extent practicable. In
connection with clause (ii) of this paragraph, we will pay for proportional
printing costs for such Designated Portfolio Documents in order to provide
one copy for each Contract owner who is invested in a designated subaccount
on each occasion that such document is required by law or regulation to be
delivered to such Contract owner, and provided the appropriate
documentation is provided and approved by us. We shall provide you with a
copy of the Trust's current statement of additional information, including
any amendments or supplements, in a form suitable for you to duplicate. The
expenses of furnishing, including mailing, to Contract owners the documents
referred to in this paragraph shall be borne by us. For each of the
documents provided to you in accordance with clause (i) of this paragraph
4.4, we shall provide you, upon your request and at your expense,
additional copies. In no event shall we be responsible for the costs of
printing or delivery of Designated Portfolio Documents to potential or new
Contract owners.
4.5 We shall provide you, at our expense, with copies of any
Trust-sponsored proxy materials in such quantity as you shall reasonably
require for distribution to Contract owners who are invested in a
designated subaccount. We shall bear the costs of distributing
Trust-sponsored proxy materials (or similar materials such as voting
solicitation instructions) to Contract owners.
4.6 You assume sole responsibility for ensuring that the Trust's
prospectuses, shareholder reports and communications, and proxy materials
are delivered to Contract owners in accordance with applicable federal and
state securities laws.
5. VOTING
5.1 All Participating Insurance Companies shall have the obligations and
responsibilities regarding pass-through voting and conflicts of interest
corresponding to those contained in the Shared Funding Order.
5.2 If and to the extent required by law, you shall: (i) solicit voting
instructions from Contract owners; (ii) vote the Trust shares in accordance
with the instructions received from Contract owners; and (iii) vote Trust
shares for which no instructions have been received in the same proportion
as Trust shares of such Portfolio for which instructions have been
received; so long as and to the extent that the SEC continues to interpret
the 1940 Act to require pass-through voting privileges for variable
contract owners. You reserve the right to vote Trust shares held in any
Account in your own right, to the extent permitted by law.
8
5.3 So long as, and to the extent that, the SEC interprets the 1940 Act to
require pass-through voting privileges for Contract owners, you shall
provide pass-through voting privileges to Contract owners whose Contract
values are invested, through the Accounts, in shares of one or more
Portfolios of the Trust. We shall require all Participating Insurance
Companies to calculate voting privileges in the same manner and you shall
be responsible for assuring that the Accounts calculate voting privileges
in the manner established by us. With respect to each Account, you will
vote shares of each Portfolio of the Trust held by an Account and for which
no timely voting instructions from Contract owners are received in the same
proportion as those shares held by that Account for which voting
instructions are received. You and your agents will in no way recommend or
oppose or interfere with the solicitation of proxies for Portfolio shares
held to fund the Contracts without our prior written consent, which consent
may be withheld in our sole discretion.
6. SALES MATERIAL, INFORMATION AND TRADEMARKS
6.1 For purposes of this Section 6, "Sales literature or other Promotional
material" includes, but is not limited to, portions of the following that
use any logo or other trademark related to the Trust, or Underwriter or its
affiliates, or refer to the Trust: advertisements (such as material
published or designed for use in a newspaper, magazine or other periodical,
radio, television, telephone or tape recording, videotape display, signs or
billboards, motion pictures, electronic communication or other public
media), sales literature (i.e., any written communication distributed or
made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts,
reprints or excerpts or any other advertisement, sales literature or
published article or electronic communication), educational or training
materials or other communications distributed or made generally available
to some or all agents or employees in any media, and disclosure documents,
shareholder reports and proxy materials.
6.2 Upon our request, you shall furnish, or cause to be furnished to us or
our designee, all portions or provisions of each registration statement,
prospectus, statement of additional information, private placement
memorandum, retirement plan disclosure information or other disclosure
documents or similar information, as applicable (collectively "Disclosure
Documents") that relate to or discuss the Trust, a Portfolio, the
Underwriter or an Adviser, as well as any report, solicitation for voting
instructions, Sales literature or other Promotional materials, and all
amendments to any of the above that relate to the Contracts or the Accounts
and relate to or discuss the Trust, a Portfolio, the Underwriter or an
Adviser prior to its first use. You shall furnish, or shall cause to be
furnished, to us or our designee each piece of Sales literature or other
Promotional material in which the Trust or an Adviser is named, at least
ten (10) Business Days prior to its proposed use. No such material shall be
used unless we or our designee approve such material and its proposed use.
We shall furnish, or shall cause to be furnished, to you or your designee
each piece of Sales literature or other Promotional material prepared by us
in which you are named, at least ten (10) Business Days prior to its
proposed use, other than a simple list identifying Trust shareholders by
name. No such material shall be used unless you or your designee approve
such material and its proposed use.
9
6.3 You and your agents shall not give any information or make any
representations or statements on behalf of the Trust or concerning the
Trust, the Underwriter or an Adviser, other than information or
representations contained in and accurately derived from the registration
statement, prospectus or statement of additional information for the Trust
shares (as such registration statement, prospectus and statement of
additional information may be amended or supplemented from time to time),
annual and semi-annual reports of the Trust, Trust-sponsored proxy
statements, or in Sales literature or other Promotional material approved
by the Trust or its designee, except as required by legal process or
regulatory authorities or with the written permission of the Trust or its
designee. You shall send us a complete copy of each Disclosure Document and
item of Sales literature or other Promotional materials in its final form
within twenty (20) days of its first use.
6.4 We shall not give any information or make any representations or
statements on behalf of you or concerning you, the Accounts or the
Contracts other than information or representations, including naming you
as a Trust shareholder, contained in and accurately derived from Disclosure
Documents for the Contracts (as such Disclosure Documents may be amended or
supplemented from time to time), or in materials approved by you for
distribution, including Sales literature or other Promotional materials,
except as required by legal process or regulatory authorities or with your
written permission.
6.5 Except as provided in Section 6.2, you shall not use any designation
comprised in whole or part of the names or marks "Franklin" or "Xxxxxxxxx"
or any logo or other trademark relating to the Trust or the Underwriter
without prior written consent, and upon termination of this Agreement for
any reason, you shall cease all use of any such name or xxxx as soon as
reasonably practicable.
6.6 You shall furnish to us ten (10) Business Days prior to its first
submission to the SEC or its staff, any request or filing for no-action
assurance or exemptive relief naming, pertaining to, or affecting, the
Trust, the Underwriter or any of the Portfolios.
7. INDEMNIFICATION
7.1 INDEMNIFICATION BY YOU
7.1.1 You agree to indemnify and hold harmless the Underwriter, the
Trust and each of its Trustees, officers, employees and agents and
each person, if any, who controls the Trust within the meaning of
Section 15 of the 1933 Act (collectively, the "Indemnified Parties"
and individually the "Indemnified Party" for purposes of this Section
7.1) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with your written consent, which
consent shall not be unreasonably withheld) or expenses (including the
reasonable costs of investigating or defending any alleged loss,
claim, damage, fine, liability or expense and reasonable legal counsel
fees incurred in connection therewith) (collectively, "Losses"), to
which the Indemnified Parties may become subject under any statute or
regulation, or at common law or otherwise, insofar as such Losses are
related to the sale or acquisition of shares of the Trust or the
Contracts and:
10
7.1.1.1 arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in a
Disclosure Document for the Contracts or in the Contracts
themselves or in sales literature generated or approved by you on
behalf of the Contracts or Accounts (or any amendment or
supplement to any of the foregoing) (collectively, "Company
Documents" for the purposes of this Section 7), or arise out of
or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, provided
that this indemnity shall not apply as to any Indemnified Party
if such statement or omission or such alleged statement or
omission was made in reliance upon and was accurately derived
from written information furnished to you by or on behalf of the
Trust for use in Company Documents or otherwise for use in
connection with the sale of the Contracts or Trust shares; or
7.1.1.2 arise out of or result from statements or
representations (other than statements or representations
contained in and accurately derived from Trust Documents as
defined below in Section 7.2) or wrongful conduct of you or
persons under your control, with respect to the sale or
acquisition of the Contracts or Trust shares; or
7.1.1.3 arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Trust
Documents as defined below in Section 7.2 or the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement or the
statements therein not misleading if such statement or omission
was made in reliance upon and accurately derived from written
information furnished to the Trust by or on behalf of you; or
7.1.1.4 arise out of or result from any failure by you to
provide the services or furnish the materials required under the
terms of this Agreement;
7.1.1.5 arise out of or result from any material breach of any
representation and/or warranty made by you in this Agreement or
arise out of or result from any other material breach of this
Agreement by you; or
7.1.1.6 arise out of or result from a Contract failing to be
considered a life insurance policy or an annuity Contract,
whichever is appropriate, under applicable provisions of the Code
thereby depriving the Trust of its compliance with Section 817(h)
of the Code, unless such Contract's failure was caused by the
Trust's failure to comply with Subchapter M or Section 817(h) of
the Code;
as limited by and in accordance with the provisions of Sections 7.1.2 and 7.1.3
hereof.
7.1.2 You shall not be liable under this indemnification provision
with respect to any Losses to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's
reckless disregard of
11
obligations and duties under this Agreement or to the Trust or
Underwriter, whichever is applicable.
7.1.3 You shall also not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified you in writing
within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been
served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent),
but failure to notify you of any such claim shall not relieve you from
any liability which it may have to the Indemnified Party against whom
such action is brought otherwise than on account of this
indemnification provision. In case any such action is brought against
the Indemnified Parties, you shall be entitled to participate, at your
own expense, in the defense of such action. Unless the Indemnified
Party releases you from any further obligations under this Section
7.1, you also shall be entitled to assume the defense thereof, with
counsel satisfactory to the party named in the action. After notice
from you to such party of your election to assume the defense thereof,
the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and you will not be liable to such
party under this Agreement for any legal or other expenses
subsequently incurred by such party independently in connection with
the defense thereof other than reasonable costs of investigation.
7.1.4 The Indemnified Parties will promptly notify you of the
commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
7.2 INDEMNIFICATION BY THE UNDERWRITER
7.2.1 The Underwriter agrees to indemnify and hold harmless you, and
each of your directors and officers and each person, if any, who
controls you within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" and individually an
"Indemnified Party" for purposes of this Section 7.2) against any and
all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Underwriter, which consent
shall not be unreasonably withheld) or expenses (including the
reasonable costs of investigating or defending any alleged loss,
claim, damage, liability or expense and reasonable legal counsel fees
incurred in connection therewith) (collectively, "Losses") to which
the Indemnified Parties may become subject under any statute, or
regulation, or at common law or otherwise, insofar as such Losses are
related to the sale or acquisition of the shares of the Trust or the
Contracts and:
7.2.1.1 arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statement, prospectus or sales literature of the
Trust (or any amendment or supplement to any of the foregoing)
(collectively, the "Trust Documents") or arise out of or are
based upon the omission or the alleged omission to state therein
a material fact required to be stated therein or necessary to
make the statements therein not misleading, provided that this
indemnity shall not apply as to any Indemnified Party if such
statement or omission or such alleged
12
statement or omission was made in reliance upon and was
accurately derived from written information furnished to us by or
on behalf of you for use in Trust Documents or otherwise for use
in connection with the sale of the Contracts or Trust shares; or
7.2.1.2 arise out of result from statements or representations
(other than statements or representations contained in and
accurately derived from Company Documents not supplied by the
Underwriter or persons under its control) or wrongful conduct of
the Trust, Adviser or Underwriter or persons under their control,
with respect to the sale or distribution of the Contracts or
Trust shares; or
7.2.1.3 arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Company
Documents, or any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement
or statements therein not misleading, if such statement or
omission was made in reliance upon information furnished to you
by or on behalf of the Trust; or
7.2.1.4 arise as a result of any failure by us to provide the
services and furnish the materials under the terms of this
Agreement (including a failure, whether unintentional or in good
faith or otherwise, to comply with the qualification
representation specified above in Section 2.2.7 and the
diversification requirements specified above in Section 2.2.8);
or
7.2.1.5 arise out of or result from any material breach of any
representation and/or warranty made by the Underwriter in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Underwriter; as limited by and in
accordance with the provisions of Sections 7.2.2 and 7.2.3
hereof.
7.2.2 The Underwriter shall not be liable under this indemnification
provision with respect to any Losses to which an Indemnified Party
would otherwise be subject by reason of such Indemnified Party's
willful misfeasance, bad faith, or gross negligence in the performance
of such Indemnified Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations and duties under this
Agreement or to you or the Accounts, whichever is applicable.
7.2.3 The Underwriter shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified the Underwriter in
writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have
been served upon such Indemnified Party (or after such Indemnified
Party shall have received notice of such service on any designated
agent), but failure to notify the Underwriter of any such claim shall
not relieve the Underwriter from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any such
action is brought against the Indemnified Parties, the Underwriter
will be entitled to participate, at its own expense, in the defense
thereof. Unless the Indemnified Party releases the Underwriter from
any further obligations under this Section 7.2,
13
the Underwriter also shall be entitled to assume the defense thereof,
with counsel satisfactory to the party named in the action. After
notice from the Underwriter to such party of the Underwriter's
election to assume the defense thereof, the Indemnified Party shall
bear the expenses of any additional counsel retained by it, and the
Underwriter will not be liable to such party under this Agreement for
any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than
reasonable costs of investigation.
7.2.4 You agree promptly to notify the Underwriter of the
commencement of any litigation or proceedings against you or the
Indemnified Parties in connection with the issuance or sale of the
Contracts or the operation of each Account.
7.3 INDEMNIFICATION BY THE TRUST
7.3.1 The Trust agrees to indemnify and hold harmless you, and each
of your directors and officers and each person, if any, who controls
you within the meaning of Section 15 of the 1933 Act (collectively,
the "Indemnified Parties" for purposes of this Section 7.3) against
any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Trust, which
consent shall not be unreasonably withheld) or litigation (including
legal and other expenses) to which the Indemnified Parties may become
subject under any statute, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in
respect thereof) or settlements result from the gross negligence, bad
faith or willful misconduct of the Board or any member thereof, are
related to the operations of the Trust, and arise out of or result
from any material breach of any representation and/or warranty made by
the Trust in this Agreement or arise out of or result from any other
material breach of this Agreement by the Trust; as limited by and in
accordance with the provisions of Sections 7.3.2 and 7.3.3 hereof. It
is understood and expressly stipulated that neither the holders of
shares of the Trust nor any Trustee, officer, agent or employee of the
Trust shall be personally liable hereunder, nor shall any resort be
had to other private property for the satisfaction of any claim or
obligation hereunder, but the Trust only shall be liable.
7.3.2 The Trust shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation incurred or assessed against any Indemnified Party as such
may arise from such Indemnified Party's willful misfeasance, bad
faith, or gross negligence in the performance of such Indemnified
Party's duties or by reason of such Indemnified Party's reckless
disregard of obligations and duties under this Agreement or to you,
the Trust, the Underwriter or each Account, whichever is applicable.
7.3.3 The Trust shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party
unless such Indemnified Party shall have notified the Trust in writing
within a reasonable time after the summons or other first legal
process giving information of the nature of the claims shall have been
served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent),
but failure to notify the Trust of any such claim shall not relieve
the Trust from any liability which it may have to the Indemnified
Party against whom such action is brought otherwise than on account of
this indemnification provision. In case any such action is
14
brought against the Indemnified Parties, the Trust will be entitled to
participate, at its own expense, in the defense thereof. Unless the
Indemnified Party releases the Trust from any further obligations
under this Section 7.3, the Trust also shall be entitled to assume the
defense thereof, with counsel satisfactory to the party named in the
action. After notice from the Trust to such party of the Trust's
election to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it,
and the Trust will not be liable to such party under this Agreement
for any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than
reasonable costs of investigation.
7.3.4 You agree promptly to notify the Trust of the commencement of
any litigation or proceedings against you or the Indemnified Parties
in connection with this Agreement, the issuance or sale of the
Contracts, with respect to the operation of the Account, or the sale
or acquisition of shares of the Trust.
8. NOTICES
Any notice shall be sufficiently given when sent by registered or certified mail
to the other party at the address of such party set forth in Schedule G below or
at such other address as such party may from time to time specify in writing to
the other party.
9. TERMINATION
9.1 Any termination of this Agreement that is required by the Shared
Funding Order shall be governed by the provisions of the Shared Funding
Order.
9.2 This Agreement will terminate :
9.2.1 at our or your option, upon ten (10) calendar days prior
written notice to the other party, if a final non-appealable
administrative or judicial decision is entered against the other party
which has a material adverse impact on the Contracts or the
Portfolios;
9.2.2 at your option, upon ten (10) calendar days prior written
notice, if shares of the Trust are not reasonably available;
9.2.3 at your option, upon written notice, if the Trust ceases to
qualify as a Regulated Investment Company under Subchapter M of the
Code; or fails to meet the diversification requirements specified in
Section 817(h) of the Code and any regulations thereunder;
9.2.4 at our option, upon written notice, if any Contract: (i) ceases
to be treated as an annuity contract or life insurance contract under
applicable provisions of the Code; or (ii) fails to qualify as a
"variable contract" within the meaning of such term under Section 817
of the Code, as amended, or any regulations thereunder;
9.2.5 by mutual written agreement of you and us;
15
9.2.6 at the option of the Trust, in the event of a determination by
the Trustees that termination of the Agreement is necessary in the
exercise of their fiduciary duties under applicable laws and
regulations, upon such written notice as is consistent with these
legal or regulatory requirements;
9.2.7 at the option of the Trust, if you notify the Trust or the
Underwriter that the exemption from registration under Section 3(c) of
the 1940 Act no longer applies, or might not apply in the future, to
the unregistered Accounts, or that the exemption from registration
under Section 4(2) or Regulation D promulgated under the 1933 Act no
longer applies or might not apply in the future, to interests under
the unregistered Contracts;
9.2.8 at our option if: (i) you breach any of the representations and
warranties made in this Agreement; or (ii) you inform us that any of
such representations and warranties may no longer be true or might not
be true in the future; or (iii) any of such representations and
warranties were not true on the effective date of this Agreement, are
at any time no longer true, or have not been true during any time
since the effective date of this Agreement;
9.2.9 at your option if: (i) we breach any of the representations and
warranties made in this Agreement; or (ii) we inform you that any of
such representations and warranties may no longer be true or might not
be true in the future; or (iii) any of such representations and
warranties were not true on the effective date of this Agreement, are
at any time no longer true, or have not been true during any time
since the effective date of this Agreement; or
9.2.10 immediately in the event of its assignment by any party
without the prior written approval of the other parties, or as
otherwise required by law.
The effective date for termination pursuant to any notice given under this
Section 9.2 shall be calculated beginning with the date of receipt of such
notice.
9.3 If this Agreement is terminated for any reason except as required by
the Shared Funding Order, we shall, at your option and pursuant to the
terms and conditions of this Agreement, continue to make available
additional shares of any Portfolio and redeem shares of any Portfolio for
any or all Contracts or Accounts existing on the effective date of
termination of this Agreement, PROVIDED THAT such further sale is not
prohibited by law, regulation, or applicable regulatory or oversight body.
9.4 The provisions of Sections 2 (Representations and Warranties) and 7
(Indemnification) shall survive the termination of this Agreement. All
other applicable provisions of this Agreement shall survive the termination
of this Agreement, as long as shares of the Trust are held on behalf of
Contract owners in accordance with Section 9.3, except that we shall have
no further obligation to sell Trust shares with respect to Contracts issued
after termination.
9.5 You shall not redeem Trust shares attributable to the Contracts (as
opposed to Trust shares attributable to your assets held in the Account)
except: (i) as necessary to implement Contract owner initiated or approved
transactions; (ii) as required by state and/or
16
federal laws or regulations or judicial or other legal precedent of general
application (hereinafter referred to as a "Legally Required Redemption");
or (iii) as permitted by an order of the SEC pursuant to Section 26(b) of
the 1940 Act, SEC no-action letter, or other legal and appropriate means.
Upon request, you shall promptly furnish to us the opinion of your counsel
(which counsel shall be reasonably satisfactory to us) to the effect that
any redemption pursuant to clause (ii) above is a Legally Required
Redemption. Furthermore, except in cases where permitted under the terms of
the Contracts, you shall not prevent Contract owners from allocating
payments to a Portfolio that was otherwise available under the Contracts
without first giving us ninety (90) days notice of your intention to do so.
10. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions of
this Agreement or otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, all of which taken together shall constitute one and the same
instrument.
10.3 If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
10.4 This Agreement shall be construed and its provisions interpreted
under and in accordance with the laws of the State of
California. It shall
also be subject to the provisions of the federal securities laws and the
rules and regulations thereunder, to any orders of the SEC on behalf of the
Trust granting it exemptive relief, and to the conditions of such orders.
We shall promptly forward copies of any such orders to you.
10.5 The parties to this Agreement acknowledge and agree that all
liabilities of the Trust arising, directly or indirectly, under this
Agreement, of any and every nature whatsoever, shall be satisfied solely
out of the assets of the Trust and that no Trustee, officer, agent or
holder at shares of beneficial interest of the Trust shall be personally
liable for any such liabilities.
10.6 The parties to this Agreement agree that the assets and liabilities
of each Portfolio of the Trust are separate and distinct from the assets
and liabilities of each other Portfolio. No Portfolio shall be liable or
shall be charged for any debt, obligation or liability of any other
Portfolio.
10.7 Each party to this Agreement shall cooperate with each other party
and all appropriate governmental authorities (including without limitation
the SEC, the NASD, and state insurance regulators) and shall permit such
authorities reasonable access to its books and records in connection with
any investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
17
10.8 Each party shall treat as confidential all information of the other
party which the parties agree in writing is confidential ("Confidential
Information"). Except as permitted by this Agreement or as required by
appropriate governmental authority (including, without limitation, the SEC,
the NASD, or state securities and insurance regulators) the receiving party
shall not disclose or use Confidential Information of the other party
before it enters the public domain, without the express written consent of
the party providing the Confidential Information. Each party further agrees
to use and disclose Personal Information, as defined below, only to carry
out the purposes for which it was disclosed to them and will not use or
disclose Personal Information if prohibited by applicable law, including,
without limitation, statutes and regulations enacted pursuant to the
Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102). For purposes of this
Agreement, "Personal Information" means financial and medical information
that identifies an individual personally and is not available to the
public, including, but not limited to, credit history, income, financial
benefits, policy or claim information and medical records. If either party
outsource services to a third party, such third party will agree in writing
to maintain the security and confidentiality of any information shared with
them.
10.9 The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties to this Agreement are
entitled to under state and federal laws.
10.10 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect.
10.11 Neither this Agreement nor any rights or obligations created by it
may be assigned by any party without the prior written approval of the
other parties.
10.12 No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by
both parties.
IN WITNESS WHEREOF, each of the parties has caused their duly authorized
officers to execute this Agreement.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C HEREOF. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: FRANKLIN XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxxx X. Xxxx
-----------------------------
Name: Xxxxxx X. Xxxx
Title: Senior Vice President
18
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxxx Xxxxx
-----------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
Distributor to the Company: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By: /s/ Xxxxxx Xxx
-----------------------------
Name: Xxxxxx Xxx
Title: Chief Compliance Officer
HARTFORD EQUITY SALES COMPANY, INC.
By: /s/ Xxxxxx Xxx
-----------------------------
Name: Xxxxxx Xxx
Title: Chief Compliance Officer
19
SCHEDULE A
THE COMPANY AND ITS DISTRIBUTOR
THE COMPANY:
Hartford Life Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A life insurance company organized under the laws of the state of Connecticut.
Hartford Life and Annuity Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A life insurance company organized under the laws of the state of Connecticut.
DISTRIBUTOR TO THE COMPANY:
Hartford Securities Distribution Company, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A corporation organized under the laws of the state of Connecticut.
Hartford Securities Distribution Company, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
A corporation organized under the laws of the state of Connecticut.
A-1
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Hartford Life Insurance Company Separate
Account Three
Date Established: June 22, 1994
SEC Registration Number: 811-08584
2. Name: Hartford Life and Annuity Insurance Company
Separate Account Three
Date Established: June 22, 1994
SEC Registration Number: 811-08580
3. Name: Hartford Life Insurance Company Separate
Account VL I
Date Established: September 18, 1992
SEC Registration Number: 811-03072
4. Name: Hartford Life and Annuity Insurance Company
Separate Account VL I
Date Established: June 8, 1995
SEC Registration Number: 811-07329
5. Name: Hartford Life Insurance Company Separate
Account XX XX
Date Established: September 30, 1994
SEC Registration Number: 811-07271
4. Name: Hartford Life and Annuity Insurance Company
Separate Account XX XX
Date Established: September 30, 1994
SEC Registration Number: 811-07273
5. Name: ICMG Registered Variable Life Separate
Account A
Date Established: April 14, 1998
SEC Registration Number: 811-08913
6. Name: ICMG Registered Variable Life Separate
Account One
Date Established: October 9, 1995
SEC Registration Number: 811-07387
B-1
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
----------------------------------------------------------------------------------------------------------------
Franklin Rising Dividends Securities Fund -- Class 2 Franklin Advisory Services, LLC
Franklin Small-Mid Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Small Cap Value Securities Fund -- Class 2 Franklin Advisory Services, LLC
Franklin Strategic Income Securities Fund -- Class 1 Franklin Advisers, Inc.
Mutual Shares Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Templeton Developing Markets Securities Fund -- Class 1 Xxxxxxxxx Asset Management Ltd.
Templeton Foreign Securities Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund -- Class 2 Xxxxxxxxx Global Advisors Limited
C-1
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
----------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Select Hartford Life CLASS 1 SHARES:
Insurance Leaders Variable Insurance Company Franklin Strategic Income Securities Fund
Company Annuity Separate Account Three Xxxxxxxxx Developing Markets Securities Fund
Yes Yes CLASS 2 SHARES:
333-35000 811-08584 Franklin Small-Mid Cap Growth Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
02 Hartford Life Hartford Select Hartford Life CLASS 1 SHARES:
Insurance Leaders (Series II) Insurance Company Franklin Strategic Income Securities Fund
Company Variable Annuity Separate Account Three Xxxxxxxxx Developing Markets Securities Fund
Yes Yes CLASS 2 SHARES:
333-101927 811-08584 Franklin Small-Mid Cap Growth Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
03 Hartford Life Hartford Select Hartford Life and CLASS 1 SHARES:
and Annuity Leaders Variable Annuity Insurance Franklin Strategic Income Securities Fund
Insurance Annuity Company Separate Xxxxxxxxx Developing Markets Securities Fund
Company Yes Account Three CLASS 2 SHARES:
333-34998 Yes Franklin Small-Mid Cap Growth Securities Fund
811-08580 Mutual Shares Securities Fund
Templeton Growth Securities Fund
04 Hartford Life Hartford Select Hartford Life and CLASS 1 SHARES:
and Annuity Leaders (Series II) Annuity Insurance Franklin Strategic Income Securities Fund
Insurance Variable Annuity Company Separate Xxxxxxxxx Developing Markets Securities Fund
Company Yes Account Three CLASS 2 SHARES:
333-101928 Yes Franklin Small-Mid Cap Growth Securities Fund
811-08580 Mutual Shares Securities Fund
Templeton Growth Securities Fund
D-1
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------
05 Hartford Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Life Leaders Outlook Company Separate Account Franklin Strategic Income Securities Fund
Insurance Variable Annuity Three Xxxxxxxxx Developing Markets Securities Fund
Company Yes Yes CLASS 2 SHARES:
333-102625 811-08584 Franklin Small-Mid Cap Growth Securities
Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
06 Hartford Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
Life and Leaders Outlook Insurance Company Franklin Strategic Income Securities Fund
Annuity Variable Annuity Separate Account Three Xxxxxxxxx Developing Markets Securities Fund
Insurance Yes Yes CLASS 2 SHARES:
Company 333-102628 811-08580 Franklin Small-Mid Cap Growth Securities
Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
07 Hartford Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Life Leaders Last Company Separate Account Franklin Strategic Income Securities Fund
Insurance Survivor Universal XX XX Xxxxxxxxx Developing Markets Securities Fund
Company Life Insurance Yes CLASS 2 SHARES:
Yes 811-07271 Franklin Small-Mid Cap Growth Securities
333-88261 Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
08 Hartford Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
Life and Leaders Last Insurance Company Franklin Strategic Income Securities Fund
Annuity Survivor Universal Separate Account XX XX Xxxxxxxxx Developing Markets Securities Fund
Insurance Life Insurance Yes CLASS 2 SHARES:
Company Yes 811-07273 Franklin Small-Mid Cap Growth Securities
333-67373 Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
09 Hartford Omnisource ICMG Registered Variable CLASS 1 SHARES:
Life Variable Life Life Separate Account A Franklin Strategic Income Securities Fund
Insurance Insurance Yes CLASS 2 SHARES:
Company Yes 811-08913 Franklin Rising Dividends Securities Fund
333-60515 Franklin Small-Mid Cap Growth Securities
Fund
Franklin Small Cap Value Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
D-2
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------
10 Hartford Life Omnisource Variable ICMG Registered Variable CLASS 1 SHARES:
and Annuity Life Insurance Life Separate Franklin Strategic Income Securities
Insurance Yes Account One Fund
Company 033-63731 Yes CLASS 2 SHARES:
811-07387 Franklin Rising Dividends Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
11 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Insurance Company Separate Franklin Small Cap Value Securities
Company Yes Account VL I Fund
033-53692 Yes Mutual Shares Securities Fund
811-3072
12 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Insurance Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 033-61267 Yes Mutual Shares Securities Fund
811-07329
13 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Artisan Company Separate Franklin Small Cap Value Securities
Company Yes Account VL I Fund
333-07465 Yes Mutual Shares Securities Fund
811-3072
14 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Artisan Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 333-07471 Yes Mutual Shares Securities Fund
811-07329
15 Hartford Life Stag Protector Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Franklin Small Cap Value Securities
Company Life Insurance Account VL I Fund
Yes Yes Mutual Shares Securities Fund
333-94617 811-3072
16 Hartford Life Stag Protector Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-83057 811-07329
17 Hartford Life Stag Accumulator Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Franklin Small Cap Value Securities
Company Life Insurance Account VL I Fund
Yes Yes Mutual Shares Securities Fund
333-50280 811-3072
D-3
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------
18 Hartford Life Stag Accumulator Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-93319 811-07329
19 Hartford Life Stag Wall Street Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-82866 811-07329
20 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Last Survivor Company Separate Franklin Small Cap Value Securities
Company Yes Account XX XX Fund
033-89990 Yes Mutual Shares Securities Fund
811-07271
21 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Last Survivor Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account XX XX Fund
Company 033-89988 Yes Mutual Shares Securities Fund
811-07273
22 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Last Survivor II Company Separate Franklin Small Cap Value Securities
Company Yes Account XX XX Fund
333-88261 Yes Mutual Shares Securities Fund
811-07271
23 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Last Survivor II Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account XX XX Fund
Company 333-67373 Yes Mutual Shares Securities Fund
811-07273
24 Hartford Life Stag Protector II Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Franklin Small Cap Value Securities
Company Life Insurance Account VL I Fund
Yes Yes Mutual Shares Securities Fund
333-109530 811-3072
25 Hartford Life Stag Protector II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-88787 811-07329
26 Hartford Life Stag Accumulator II Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Franklin Small Cap Value Securities
Company Life Insurance Account VL I Fund
Yes Yes Mutual Shares Securities Fund
333-109529 811-3072
27 Hartford Life Stag Accumulator II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-07471 811-07329
D-4
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------
28 Hartford Life Hartford Quantum Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Life Company Separate Franklin Small Cap Value Securities
Company Insurance Account VL I Fund
Yes Yes Mutual Shares Securities Fund
333-110550 811-3072
29 Hartford Life Hartford Quantum Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Life Insurance Company Separate Franklin Small Cap Value Securities
Insurance Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-110548 811-07329
30 Hartford Life Hartford Quantum II Hartford Life Insurance CLASS 2 SHARES:
Insurance VUL Company Separate Franklin Small Cap Value Securities
Company Yes Account VL I Fund
333-127379 Yes Mutual Shares Securities Fund
811-3072
31 Hartford Life Hartford Quantum II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity VUL Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 333-127380 Yes Mutual Shares Securities Fund
811-07329
D-5
SCHEDULE E
THIS SCHEDULE NOT USED.
E-1
SCHEDULE F
RULE 12b-1 PLANS
COMPENSATION SCHEDULE
Each Portfolio named below shall pay the following amounts pursuant to the terms
and conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan,
stated as a percentage per year of Class 2's average daily net assets
represented by shares of Class 2.
PORTFOLIO NAME MAXIMUM ANNUAL PAYMENT RATE
---------------------------------------------------------------------------------
Franklin Rising Dividends Securities Fund 0.25%
Franklin Small-Mid Cap Growth Securities Fund 0.25%
Franklin Small Cap Value Securities Fund 0.25%
Mutual Shares Securities Fund 0.25%
Xxxxxxxxx Foreign Securities Fund 0.25%
Xxxxxxxxx Growth Securities Fund 0.25%
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service which is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under NASD rules. Your
acceptance of such compensation is your acknowledgment that eligible services
have been rendered. All Rule 12b-1 fees, shall be based on the value of Eligible
Shares owned by the Company on behalf of its Accounts, and shall be calculated
on the basis and at the rates set forth in the Compensation Schedule stated
above. The aggregate annual fees paid pursuant to each Plan shall not exceed the
amounts stated as the "annual maximums" in the Portfolio's prospectus, unless an
increase is approved by shareholders as provided in the Plan. These maximums
shall be a specified percent of the value of a Portfolio's net assets
attributable to Eligible Shares owned by the Company on behalf of its Accounts
(determined in the same manner as the Portfolio uses to compute its net assets
as set
F-1
forth in its effective Prospectus). The Rule 12b-1 fee will be paid to you
within thirty (30) days after the end of the three-month periods ending in
January, April, July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written report of the amounts expended under the
Plans and the purposes for which such expenditures were made.
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
F-2
SCHEDULE G
ADDRESSES FOR NOTICES
To the Company or
the Distributor: Hartford Life Insurance Company, or
Hartford Life and Annuity Insurance Company, or
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx Xxxxx
Senior Vice President
With a copy to: Hartford Life Insurance Company or
Hartford Life and Annuity Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxx Kreezko, Deputy General Counsel
To the Trust: Franklin Xxxxxxxxx Variable Insurance Products Trust
0 Xxxxxxxx Xxxxxxx, Xxxx. 000, 2nd Floor
San Mateo,
California 94403
Attention: Xxxxx X. Xxxxxxxx
Assistant Vice President
To the Underwriter: Franklin Xxxxxxxxx Distributors, Inc.
0 Xxxxxxxx Xxxxxxx, Xxxx. 000, 3rd Floor
San Mateo,
California 94403
Attention: Xxxxxx Xxxxxx
Senior Vice President
If to the Trust or
Underwriter with a
copy to: General Counsel
Franklin Xxxxxxxxx Xxxxxxxxxxx
Xxx Xxxxxxxx Xxxxxxx, Xxxx. 000 0xx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
G-1
SCHEDULE H
SHARED FUNDING ORDER
Templeton Variable Products Series Fund, et al.
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24018
1999 SEC LEXIS 1887
September 17, 1999
ACTION: Notice of application for an amended order of exemption pursuant to
Section 6(c) of the Investment Company Act of 1940 (the "1940 Act") from the
provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act and Rules
6e-2(b)(15) and 6e-3(T)(b)(15) thereunder.
TEXT: Summary of Application: Templeton Variable Products Series Fund (the
"Templeton Trust"), Franklin Xxxxxxxxx Variable Insurance Products Trust
(formerly Franklin Valuemark Funds) (the "VIP Trust," and together with the
Templeton Trust, the "Funds"), Xxxxxxxxx Funds Annuity Company ("TFAC") or any
successor to TFAC, and any future open-end investment company for which TFAC or
any affiliate is the administrator, sub-administrator, investment manager,
adviser, principal underwriter, or sponsor ("Future Funds") seek an amended
order of the Commission to (1) add as parties to that order the VIP Trust and
any Future Funds and (2) permit shares of the Funds and Future Funds to be
issued to and held by qualified pension and retirement plans outside the
separate account context.
Applicants: Templeton Variable Products Series Fund, Franklin Xxxxxxxxx Variable
Insurance Products Trust, Xxxxxxxxx Funds Annuity Company or any successor to
TFAC, and any future open-end investment company for which TFAC or any affiliate
is the administrator, sub-administrator, investment manager, adviser, principal
underwriter, or sponsor (collectively, the "Applicants").
Filing Date: The application was filed on July 14, 1999, and amended and
restated on September 17, 1999.
Hearing or Notification of Hearing: An order granting the application will be
issued unless the Commission orders a hearing. Interested persons may request a
hearing by writing to the Secretary of the Commission and serving Applicants
with a copy of the request, personally or by mail. Hearing requests should be
received by the Commission by 5:30 p.m., on October 12, 1999, and should be
accompanied by proof of service on the Applicants in the form of an affidavit
or, for lawyers, a certificate of service. Hearing requests should state the
nature of the writer's interest, the reason for the request, and the issues
contested. Persons who wish to be notified of a hearing may request notification
by writing to the Secretary of the Commission.
Addresses: Secretary, Securities and Exchange Commission, 000 Xxxxx Xxxxxx, XX.
Xxxxxxxxxx, X.X. 00000-0000.
Applicants: Templeton Variable Products Series Fund and Franklin Xxxxxxxxx
Variable Insurance Products Trust, 000 Xxxxxxxx Xxxxxx Xxxxxxxxx, Xxx Xxxxx,
Xxxxxxxxxx 00000, Attn: Xxxxx X. Xxxxxxxx, Esq.
For Further Information Contact: Xxxxx X. XxXxxxx, Senior Counsel, or Xxxxx X.
Xxxxx, Branch Chief, Office of Insurance Products, Division of Investment
Management, at (000) 000-0000.
H-1
Supplementary Information: The following is a summary of the application. The
complete application is available for a fee from the SEC's Public Reference
Branch, 000 Xxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000-0000 (tel. (202)
000-0000).
Applicants' Representations:
1. Each of the Funds is registered under the 1940 Act as an open-end management
investment company and was organized as a Massachusetts business trust. The
Templeton Trust currently consists of eight separate series, and the VIP Trust
consists of twenty-five separate series. Each Fund's Declaration of Trust
permits the Trustees to create additional series of shares at any time. The
Funds currently serve as the underlying investment medium for variable annuity
contracts and variable life insurance policies issued by various insurance
companies. The Funds have entered into investment management agreements with
certain investment managers ("Investment Managers") directly or indirectly owned
by Franklin Resources, Inc. ("Resources"), a publicly owned company engaged in
the financial services industry through its subsidiaries.
2. TFAC is an indirect, wholly owned subsidiary of Resources. TFAC is the sole
insurance company in the Franklin Xxxxxxxxx organization, and specializes in the
writing of variable annuity contracts. The Templeton Trust has entered into a
Fund Administration Agreement with Franklin Xxxxxxxxx Services, Inc. ("FT
Services"), which replaced TFAC in 1998 as administrator, and FT Services
subcontracts certain services to TFAC. FT Services also serves as administrator
to all series of the VIP Trust. TFAC and FT Services provide certain
administrative facilities and services for the VIP and Templeton Trusts.
3. On November 16, 1993, the Commission issued an order granting exemptive
relief to permit shares of the Xxxxxxxxx Trust to be sold to and held by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies (Investment Company Act
Release No. 19879, File No. 812-8546) (the "Original Order"). Applicants
incorporate by reference into the application the Application for the Original
Order and each amendment thereto, the Notice of Application for the Original
Order, and the Original Order, to the extent necessary, to supplement the
representations made in the application in support of the requested relief.
Applicants represent that all of the facts asserted in the Application for the
Original Order and any amendments thereto remain true and accurate in all
material respects to the extent that such facts are relevant to any relief on
which Applicants continue to rely. The Original Order allows the Templeton Trust
to offer its shares to insurance companies as the investment vehicle for their
separate accounts supporting variable annuity contracts and variable life
insurance contracts (collectively, the "Variable Contracts"). Applicants state
that the Original Order does not (i) include the VIP Trust or Future Funds as
parties, not (ii) expressly address the sale of shares of the Funds or any
Future Funds to qualified pension and retirement plans outside the separate
account context including, without limitation, those trusts, plans, accounts,
contracts or annuities described in Sections 401(a), 403(a), 403(b), 408(b),
408(k), 414(d), 457(b), 501(c)(18) of the Internal Revenue Code of 1986, as
amended (the "Code"), and any other trust, plan, contract, account or annuity
that is determined to be within the scope of Treasury Regulation
1.817.5(f)(3)(iii) ("Qualified Plans").
4. Separate accounts owning shares of the Funds and their insurance company
depositors are referred to in the application as "Participating Separate
Accounts" and "Participating Insurance Companies," respectively. The use of a
common management investment company as the underlying investment medium for
both variable annuity and variable life insurance separate accounts of a single
insurance company (or of two or more affiliated insurance companies) is referred
to as "mixed funding." The use of a common management investment company as the
underlying investment medium for variable annuity and/or variable life insurance
separate accounts of unaffiliated insurance companies is referred to as "shared
funding."
Applicants' Legal Analysis:
1. Applicants request that the Commission issue an amended order pursuant to
Section 6(c) of the 1940 Act, adding the VIP Trust and Future Funds to the
Original Order and exempting scheduled premium variable life insurance separate
accounts and flexible premium variable life insurance separate accounts of
Participating Insurance Companies (and, to the extent necessary, any principal
underwriter and depositor of such an account) and the Applicants from Sections
9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and Rules 6e-2(b)(15) and
6e-3(T)(b)(15)
H-2
(and any comparable rule) thereunder, respectively, to the extent necessary to
permit shares of the Funds and any Future Funds to be sold to and held by
Qualified Plans. Applicants submit that the exemptions requested are appropriate
in the public interest, consistent with the protection of investors, and
consistent with the purposes fairly intended by the policy and provisions of the
1940 Act.
2. The Original Order does not include the VIP Trust or Future Funds as parties
nor expressly address the sale of shares of the Funds or any Future Funds to
Qualified Plans. Applicants propose that the VIP Trust and Future Funds be added
as parties to the Original Order and the Funds and any Future Funds be permitted
to offer and sell their shares to Qualified Plans.
3. Section 6(c) of the 1940 Act provides, in part, that the Commission, by
order upon application, may conditionally or unconditionally exempt any person,
security or transaction, or any class or classes of persons, securities or
transactions from any provisions of the 1940 Act or the rules or regulations
thereunder, if and to the extent that such exemption is necessary or appropriate
in the public interest and consistent with the protection of investors and the
purposes fairly intended by the policy and provisions of the 1940 Act.
4. In connection with the funding of scheduled premium variable life insurance
contracts issued through a separate account registered under the 1940 Act as a
unit investment trust ("UIT"), Rule 6e-2(b)(15) provides partial exemptions from
various provisions of the 1940 Act, including the following: (1) Section 9(a),
which makes it unlawful for certain individuals to act in the capacity of
employee, officer, or director for a UIT, by limiting the application of the
eligibility restrictions in Section 9(a) to affiliated persons directly
participating in the management of a registered management investment company;
and (2) Sections 13(a), 15(a) and 15(b) of the 1940 Act to the extent that those
sections might be deemed to require "pass-through" voting with respect to an
underlying fund's shares, by allowing an insurance company to disregard the
voting instructions of contractowners in certain circumstances.
5. These exemptions are available, however, only where the management
investment company underlying the separate account (the "underlying fund")
offers its shares "exclusively to variable life insurance separate accounts of
the life insurer, or of any affiliated life insurance company." Therefore, Rule
6e-2 does not permit either mixed funding or shared funding because the relief
granted by Rule 6e-2(b)(15) is not available with respect to a scheduled premium
variable life insurance separate account that owns shares of an underlying fund
that also offers its shares to a variable annuity or a flexible premium variable
life insurance separate account of the same company or of any affiliated life
insurance company. Rule 6e-2(b)(l5) also does not permit the sale of shares of
the underlying fund to Qualified Plans.
6. In connection with flexible premium variable life insurance contracts issued
through a separate account registered under the 1940 Act as a UIT, Rule
6e-3(T)(b)(15) also provides partial exemptions from Sections 9(a), 13(a), 15(a)
and 15(b) of the 1940 Act. These exemptions, however, are available only where
the separate account's underlying fund offers its shares "exclusively to
separate accounts of the life insurer, or of any affiliated life insurance
company, offering either scheduled contracts or flexible contracts, or both; or
which also offer their shares to variable annuity separate accounts of the life
insurer or of an affiliated life insurance company." Therefore, Rule 6e-3(T)
permits mixed funding but does not permit shared funding and also does not
permit the sale of shares of the underlying fund to Qualified Plans. As noted
above, the Original Order granted the Templeton Trust exemptive relief to permit
mixed and shared funding, but did not expressly address the sale of its shares
to Qualified Plans.
7. Applicants note that if the Funds were to sell their shares only to
Qualified Plans, exemptive relief under Rule 6e-2 and Rule 6e-3(T) would not be
necessary. Applicants state that the relief provided for under Rule 6e-2(b)(l5)
and Rule 6e-3(T)(b)(15) does not relate to qualified pension and retirement
plans or to a registered investment company's ability to sell its shares to such
plans.
8. Applicants state that changes in the federal tax law have created the
opportunity for each of the Funds to increase its asset base through the sale of
its shares to Qualified Plans. Applicants state that Section 817(h) of the
Internal Revenue Code of 1986, as amended (the "Code"), imposes certain
diversification standards on the assets underlying Variable Contracts. Treasury
Regulations generally require that, to meet the diversification requirements,
all of the beneficial interests in the underlying investment company must be
held by the segregated asset accounts of
H-3
one or more life insurance companies. Notwithstanding this, Applicants note that
the Treasury Regulations also contain an exception to this requirement that
permits trustees of a Qualified Plan to hold shares of an investment company,
the shares of which are also held by insurance company segregated asset
accounts, without adversely affecting the status of the investment company as an
adequately diversified underlying investment of Variable Contracts issued
through such segregated asset accounts (Treas. Reg. 1.817-5(f)(3)(iii)).
9. Applicants state that the promulgation of Rules 6e-2(b)(15) and
6e-3(T)(b)(15) under the 1940 Act preceded the issuance of these Treasury
Regulations. Thus, Applicants assert that the sale of shares of the same
investment company to both separate accounts and Qualified Plans was not
contemplated at the time of the adoption of Rules 6e-2(b)(15) and
6e-3(T)(b)(15).
10. Section 9(a) provides that it is unlawful for any company to serve as
investment adviser or principal underwriter of any registered open-end
investment company if an affiliated person of that company is subject to a
disqualification enumerated in Section 9(a)(1) or (2). Rules 6e-2(b)(l5) and
6e-3(T)(b)(15) provide exemptions from Section 9(a) under certain circumstances,
subject to the limitations on mixed and shared funding. These exemptions limit
the application of the eligibility restrictions to affiliated individuals or
companies that directly participate in the management of the underlying
portfolio investment company.
11. Applicants state that the relief granted in Rule 6e-2(b)(15) and
6e-3(T)(b)(15) from the requirements of Section 9 limits, in effect, the amount
of monitoring of an insurer's personnel that would otherwise be necessary to
ensure compliance with Section 9 to that which is appropriate in light of the
policy and purposes of Section 9. Applicants submit that those Rules recognize
that it is not necessary for the protection of investors or the purposes fairly
intended by the policy and provisions of the 1940 Act to apply the provisions of
Section 9(a) to the many individuals involved in an insurance company complex,
most of whom typically will have no involvement in matters pertaining to
investment companies funding the separate accounts.
12. Applicants to the Original Order previously requested and received relief
from Section 9(a) and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) to the extent
necessary to permit mixed and shared funding. Applicants maintain that the
relief previously granted from Section 9(a) will in no way be affected by the
proposed sale of shares of the Funds to Qualified Plans. Those individuals who
participate in the management or administration of the Funds will remain the
same regardless of which Qualified Plans use such Funds. Applicants maintain
that more broadly applying the requirements of Section 9(a) because of
investment by Qualified Plans would not serve any regulatory purpose. Moreover,
Qualified Plans, unlike separate accounts, are not themselves investment
companies and therefore are not subject to Section 9 of the 1940 Act.
13. Applicants state that Rules 6e-2(b)(15)(iii) and 6e-3(T)(b)(15)(iii)
provide exemptions from the pass-through voting requirement with respect to
several significant matters, assuming the limitations on mixed and shared
funding are observed. Rules 6e-2(b)(15)(iii)(A) and 6e-3(T)(b)(15)(iii)(A)
provide that the insurance company may disregard the voting instructions of its
contractowners with respect to the investments of an underlying fund or any
contract between a fund and its investment adviser, when required to do so by an
insurance regulatory authority (subject to the provisions of paragraphs
(b)(5)(i) and (b)(7)(ii)(A) of the Rules). Rules 6e-2(b)(15)(iii)(B) and
6e-3(T)(b)(15)(iii)(A)(2) provide that the insurance company may disregard
contractowners' voting instructions if the contractowners initiate any change in
such company's investment policies, principal underwriter, or any investment
adviser (provided that disregarding such voting instructions is reasonable and
subject to the other provisions of paragraphs (b)(5)(ii) and (b)(7)(ii)(B) and
(C) of the Rules).
14. Applicants assert that Qualified Plans, which are not registered as
investment companies under the 1940 Act, have no requirement to pass-through the
voting rights to plan participants. Applicants state that applicable law
expressly reserves voting rights to certain specified persons. Under Section
403(a) of the Employment Retirement Income Security Act ("ERISA"), shares of a
fund sold to a Qualified Plan must be held by the trustees of the Qualified
Plan. Section 403(a) also provides that the trustee(s) must have exclusive
authority and discretion to manage and control the Qualified Plan with two
exceptions: (1) when the Qualified Plan expressly provides that the trustee(s)
are subject to the direction of a named fiduciary who is not a trustee, in which
case the trustees are subject to proper directions made in accordance with the
terms of the Qualified Plan and not contrary to ERISA; and (2) when the
authority to manage, acquire or dispose of assets of the Qualified Plan is
delegated to one or more
H-4
investment managers pursuant to Section 402(c)(3) of ERISA. Unless one of the
two above exceptions stated in Section 403(a) applies, Qualified Plan trustees
have the exclusive authority and responsibility for voting proxies. Where a
named fiduciary to a Qualified Plan appoints an investment manager, the
investment manager has the responsibility to vote the shares held unless the
right to vote such shares is reserved to the trustees or the named fiduciary.
Where a Qualified Plan does not provide participants with the right to give
voting instructions. Applicants do not see any potential for material
irreconcilable conflicts of interest between or among variable contract holders
and Qualified Plan investors with respect to voting of the respective Fund's
shares. Accordingly, Applicants state that, unlike the case with insurance
company separate accounts, the issue of the resolution of material
irreconcilable conflicts with respect to voting is not present with respect to
such Qualified Plans since the Qualified Plans are not entitled to pass-through
voting privileges.
15. Even if a Qualified Plan were to hold a controlling interest in one of the
Funds, Applicants believe that such control would not disadvantage other
investors in such Fund to any greater extent than is the case when any
institutional shareholder holds a majority of the voting securities of any
open-end management investment company. In this regard, Applicants submit that
investment in a Fund by a Qualified Plan will not create any of the voting
complications occasioned by mixed funding or shared funding. Unlike mixed or
shared funding, Qualified Plan investor voting rights cannot be frustrated by
veto rights of insurers or state regulators.
16. Applicants state that some of the Qualified Plans, however, may provide for
the trustee(s), an investment adviser (or advisers), or another named fiduciary
to exercise voting rights in accordance with instructions from participants.
Where a Qualified Plan provides participants with the right to give voting
instructions, Applicants see no reason to believe that participants in Qualified
Plans generally or those in a particular Qualified Plan, either as a single
group or in combination with participants in other Qualified Plans, would vote
in a manner that would disadvantage Variable Contract holders. In sum,
Applicants maintain that the purchase of shares of the Funds by Qualified Plans
that provide voting rights does not present any complications not otherwise
occasioned by mixed or shared funding.
17. Applicants do not believe that the sale of the shares of the Funds to
Qualified Plans will increase the potential for material irreconcilable
conflicts of interest between or among different types of investors. In
particular, Applicants see very little potential for such conflicts beyond that
which would otherwise exist between variable annuity and variable life insurance
contractowners.
18. As noted above, Section 817(h) of the Code imposes certain diversification
standards on the underlying assets of variable contracts held in an underlying
mutual fund. The Code provides that a variable contract shall not be treated as
an annuity contract or life insurance, as applicable, for any period (and any
subsequent period) for which the investments are not, in accordance with
regulations prescribed by the Treasury Department, adequately diversified.
19. Treasury Department Regulations issued under Section 817(h) Provide that,
in order to meet the statutory diversification requirements, all of the
beneficial interests in the investment company must be held by the segregated
asset accounts of one or more insurance companies. However, the Regulations
contain certain exceptions to this requirement, one of which allows shares in an
underlying mutual fund to be held by the trustees of a qualified pension or
retirement plan without adversely affecting the ability of shares in the
underlying fund also to be held by separate accounts of insurance companies in
connection with their variable contracts (Treas. Reg. 1.817-5(f)(3)(iii)). Thus,
Applicants believe that the Treasury Regulations specifically permit "qualified
pension or retirement plans" and separate accounts to invest in the same
underlying fund. For this reason, Applicants have concluded that neither the
Code nor the Treasury Regulations or revenue rulings thereunder presents any
inherent conflict of interest.
20. Applicants note that while there are differences in the manner in which
distributions from Variable Contracts and Qualified Plans are taxed, these
differences will have no impact on the Funds. When distributions are to be made,
and a Separate Account or Qualified Plan is unable to net purchase payments to
make the distributions, the Separate Account and Qualified Plan will redeem
shares of the Funds at their respective net asset value in conformity with Rule
22c-1 under the 1940 Act (without the imposition of any sales charge) to provide
proceeds to meet distribution needs. A Qualified Plan will make distributions in
accordance with the terms of the Qualified Plan.
H-5
21. Applicants maintain that it is possible to provide an equitable means of
giving voting rights to Participating Separate Account contractowners and to
Qualified Plans. In connection with any meeting of shareholders, the Funds will
inform each shareholder, including each Participating Insurance Company and
Qualified Plan, of information necessary for the meeting, including their
respective share of ownership in the relevant Fund. Each Participating Insurance
Company will then solicit voting instructions in accordance with Rules 6e-2 and
6e-3(T), as applicable, and its participation agreement with the relevant Fund.
Shares held by Qualified Plans will be voted in accordance with applicable law.
The voting rights provided to Qualified Plans with respect to shares of the
Funds would be no different from the voting rights that are provided to
Qualified Plans with respect to shares of funds sold to the general public.
22. Applicants have concluded that even if there should arise issues with
respect to a state insurance commissioner's veto powers over investment
objectives where the interests of contractowners and the interests of Qualified
Plans are in conflict, the issues can be almost immediately resolved since the
trustees of (or participants in) the Qualified Plans can, on their own, redeem
the shares out of the Funds. Applicants note that state insurance commissioners
have been given the veto power in recognition of the fact that insurance
companies usually cannot simply redeem their separate accounts out of one fund
and invest in another. Generally, time-consuming, complex transactions must be
undertaken to accomplish such redemptions and transfers. Conversely, the
trustees of Qualified Plans or the participants in participant-directed
Qualified Plans can make the decision quickly and redeem their interest in the
Funds and reinvest in another funding vehicle without the same regulatory
impediments faced by separate accounts or, as is the case with most Qualified
Plans, even hold cash pending suitable investment.
23. Applicants also state that they do not see any greater potential for
material irreconcilable conflicts arising between the interests of participants
under Qualified Plans and contractowners of Participating Separate Accounts from
possible future changes in the federal tax laws than that which already exist
between variable annuity contractowners and variable life insurance
contractowners.
24. Applicants state that the sale of shares of the Funds to Qualified Plans in
addition to separate accounts of Participating Insurance Companies will result
in an increased amount of assets available for investment by the Funds. This may
benefit variable contractowners by promoting economies of scale, by permitting
increased safety of investments through greater diversification, and by making
the addition of new portfolios more feasible.
25. Applicants assert that, regardless of the type of shareholders in each
Fund, each Fund's Investment Manager is or would be contractually and otherwise
obligated to manage the Fund solely and exclusively in accordance with that
Fund's investment objectives, policies and restrictions as well as any
guidelines established by the Board of Trustees of such Fund (the "Board"). The
Investment Manager works with a pool of money and (except in a few instances
where this may be required in order to comply with state insurance laws) does
not take into account the identity of the shareholders. Thus, each Fund will be
managed in the same manner as any other mutual fund. Applicants therefore see no
significant legal impediment to permitting the sale of shares of the Funds to
Qualified Plans.
26. Applicants state that the Commission has permitted the amendment of a
substantially similar original order for the purpose of adding a party to the
original order and has permitted open-end management investment companies to
offer their shares directly to Qualified Plan in addition to separate accounts
of affiliated or unaffiliated insurance companies which issue either or both
variable annuity contracts or variable life insurance contracts. Applicants
state that the amended order sought in the application is identical to precedent
with respect to the conditions Applicants propose should be imposed on Qualified
Plans in connection with investment in the Funds.
Applicants' Conditions:
If the requested amended order is granted, Applicants consent to the following
conditions:
1. A majority of the Board of each Fund shall consist of persons who are not
"interested persons" thereof, as defined by Section 2(a)(19) of the 1940 Act,
and the rules thereunder and as modified by any applicable orders of the
Commission, except that if this condition is not met by reason of the death,
disqualification or bona fide resignation of any Board Member or Members, then
the operation of this condition shall be suspended: (a) for a period of 45 days
if the vacancy or vacancies may be filled by the remaining Board Members; (b)
for a period of 60 days if a vote
H-6
of shareholders is required to fill the vacancy or vacancies; or (c) for such
longer period as the Commission may prescribe by order upon application.
2. The Board will monitor their respective Fund for the existence of any
material irreconcilable conflict among the interests of the Variable Contract
owners of all Separate Accounts investing in the Funds and of the Qualified Plan
participants investing in the Funds. The Board will determine what action, if
any, shall be taken in response to such conflicts. A material irreconcilable
conflict may arise for a variety of reasons, including: (a) an action by any
state insurance regulatory authority; (b) a change in applicable federal or
state insurance, tax or securities laws or regulations, or a public ruling,
private letter ruling, no-action or interpretive letter, or any similar action
by insurance, tax or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant proceeding; (d) the manner in which the
investments of the Funds are being managed; (e) a difference in voting
instructions given by variable annuity contract owners, variable life insurance
contract owners, and trustees of Qualified Plans; (f) a decision by an insurer
to disregard the voting instructions of Variable Contract owners; or (g) if
applicable, a decision by a Qualified Plan to disregard the voting instructions
of Qualified Plan participants.
3. Participating Insurance Companies, the Investment Managers, and any
Qualified Plan that executes a fund participation agreement upon becoming an
owner of 10 percent or more of the assets of an Fund (a "Participating Qualified
Plan"), will report any potential or existing conflicts of which it becomes
aware to the Board of any relevant Fund. Participating Insurance Companies, the
Investment Managers and the Participating Qualified Plans will be responsible
for assisting the Board in carrying out its responsibilities under these
conditions by providing the Board with all information reasonably necessary for
the Board to consider any issues raised. This responsibility includes, but is
not limited to, an obligation by each Participating Insurance Company to inform
the Board whenever voting instructions of Contract owners are disregarded and,
if pass-through voting is applicable, an obligation by each Participating
Qualified Plan to inform the Board whenever it has determined to disregard
Qualified Plan participant voting instructions. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
obligations of all Participating Insurance Companies investing in the Funds
under their agreement governing participation in the Funds, and such agreements
shall provide that these responsibilities will be carried out with a view only
to the interest of the Variable Contract owners. The responsibility to report
such information and conflicts, and to assist the Board, will be contractual
obligations of all Participating Qualified Plans under their agreements
governing participation in the Funds, and such agreements will provide that
their responsibilities will be carried out with a view only to the interests of
Qualified Plan participants.
4. If it is determined by a majority of the Board of a Fund, or by a majority
of the disinterested Board Members, that a material irreconcilable conflict
exists, the relevant Participating Insurance companies and Participating
Qualified Plans will, at their own expense and to the extent reasonably
practicable as determined by a majority of the disinterested Board Members, take
whatever steps are necessary to remedy or eliminate the material irreconcilable
conflict, which steps could include: (a) in the case of Participating Insurance
Companies, withdrawing the assets allocable to some or all of the Separate
Account s from the Fund or any portfolio thereof and reinvesting such assets in
a different investment medium, including another portfolio of an Fund or another
Fund, or submitting the question as to whether such segregation should be
implemented to a vote of all affected Variable Contract owners and, as
appropriate, segregating the assets of any appropriate group (i.e., variable
annuity contract owners or variable life insurance contract owners of one or
more Participating Insurance Companies) that votes in favor of such segregation,
or offering to the affected Variable Contract owners the option of making such a
change; (b) in the case of Participating Qualified Plans, withdrawing the assets
allocable to some or all of the Qualified Plans from the Fund and reinvesting
such assets in a different investment medium; and (c) establishing a new
registered management investment company or managed Separate Account. If a
material irreconcilable conflict arises because of a decision by a Participating
Insurance Company to disregard Variable Contract owner voting instructions, and
that decision represents a minority position or would preclude a majority vote,
then the insurer may be required, at the Fund's election, to withdraw the
insurer's Separate Account investment in such Fund, and no charge or penalty
will be imposed its a result of such withdrawal. If a material irreconcilable
conflict arises because of a Participating Qualified Plan's decision to
disregard Qualified Plan participant voting instructions, if applicable, and
that decision represents minority position or would preclude a majority vote,
the Participating Qualified Plan may be required, at the Fund's election, to
withdraw its investment in such Fund, and no charge or penalty will be imposed
as a result of such withdrawal. The responsibility to take remedial action in
the event of a determination by a Board of a material irreconcilable conflict
and to bear the cost of such remedial action will be a contractual obligation of
all Participating
H-7
Insurance Companies and Participating Qualified Plans under their agreements
governing participation in the Funds, and these responsibilities will be carried
out with a view only to the interest of Variable Contract owners and Qualified
Plan participants.
5. For purposes of Condition 4, a majority of the disinterested Board Members
of the applicable Board will determine whether or not any proposed action
adequately remedies any material irreconcilable conflict, but in no event will
the relevant Fund or the Investment Managers be required to establish a new
funding medium for any Contract. No Participating Insurance Company shall be
required by Condition 4 to establish a new funding medium for any Variable
Contract if any offer to do so has been declined by vote of a majority of the
Variable Contract owners materially and adversely affected by the material
irreconcilable conflict. Further, no Participating Qualified Plan shall be
required by Condition 4 to establish a new funding medium for any Participating
Qualified Plan if (a) a majority of Qualified Plan participants materially and
adversely affected by the irreconcilable material conflict vote to decline such
offer, or (b) pursuant to governing Qualified Plan documents and applicable law,
the Participating Qualified Plan makes such decision without a Qualified Plan
participant vote.
6. The determination of the Board of the existence of a material irreconcilable
conflict and its implications will be made known in writing promptly to all
Participating Insurance Companies and Participating Qualified Plans.
7. Participating Insurance Companies will provide pass-through voting
privileges to Variable Contract owners who invest in registered Separate
Accounts so long as and to the extent that the Commission continues to interpret
the 1940 Act as requiring pass-through voting privileges for Variable Contract
owners. As to Variable Contracts issued by unregistered Separate Accounts,
pass-through voting privileges will be extended to participants to the extent
granted by issuing insurance companies. Each Participating Insurance Company
will also vote shares of the Funds held in its Separate Accounts for which no
voting instructions from Contract owners are timely received, as well as shares
of the Funds which the Participating Insurance Company itself owns, in the same
proportion as those shares of the Funds for which voting instructions from
contract owners are timely received. Participating Insurance Companies will be
responsible for assuring that each of their registered Separate Accounts
participating in the Funds calculates voting privileges in a manner consistent
with other Participating Insurance Companies. The obligation to calculate voting
privileges in a manner consistent with all other registered Separate Accounts
investing in the Funds will be a contractual obligation of all Participating
Insurance Companies under their agreements governing their participation in the
Funds. Each Participating Qualified Plan will vote as required by applicable law
and governing Qualified Plan documents.
8. All reports of potential or existing conflicts received by the Board of a
Fund and all action by such Board with regard to determining the existence of a
conflict, notifying Participating Insurance Companies and Participating
Qualified Plans of a conflict, and determining whether any proposed action
adequately remedies a conflict, will be properly recorded in the minutes of the
meetings of such Board or other appropriate records, and such minutes or other
records shall be made available to the Commission upon request.
9. Each Fund will notify all Participating Insurance Companies that separate
disclosure in their respective Separate Account prospectuses may be appropriate
to advise accounts regarding the potential risks of mixed and shared funding.
Each Fund shall disclose in its prospectus that (a) the Fund is intended to be a
funding vehicle for variable annuity and variable life insurance contracts
offered by various insurance companies and for qualified pension and retirement
plans; (b) due to differences of tax treatment and other considerations, the
interests of various Contract owners participating in the Fund and/or the
interests of Qualified Plans investing in the Fund may at some time be in
conflict; and (c) the Board of such Fund will monitor events in order to
identify the existence of any material irreconcilable conflicts and to determine
what action, if any, should be taken in response to any such conflict.
10. Each Fund will comply with all provisions of the 1940 Act requiring voting
by shareholders (which, for these purposes, will be the persons having a voting
interest in the shares of the Funds), and, in particular, the Funds will either
provide for annual shareholder meetings (except insofar as the Commission may
interpret Section 16 of the 1940 Act not to require such meetings) or comply
with Section 16(c) of the 1940 Act, although the Funds are not the type of trust
described in Section 16(c) of the 1940 Act, as well as with Section 16(a) of the
1940 Act and, if and when applicable, Section 16(b) of the 1940 Act. Further,
each Fund will act in accordance with the Commission's
H-8
interpretation of the requirements of Section 16(a) with respect to periodic
elections of Board Members and with whatever rules the Commission may promulgate
with respect thereto.
11. If and to the extent Rules 6e-2 or 6e-3(T) under the 1940 Act is amended,
or proposed Rule 6e-3 under the 1940 Act is adopted, to provide exemptive relief
from any provision of the 1940 Act or the rules promulgated thereunder, with
respect to mixed or shared funding on terms and conditions materially different
from any exemptions granted in the order requested in the application, then the
Funds and/or Participating Insurance Companies and Participating Qualified
Plans, as appropriate, shall take such steps as may be necessary to comply with
such Rules 6e-2 and 6e-3(T), as amended, or proposed Rule 6e-3, as adopted, to
the extent that such Rules are applicable.
12. The Participating Insurance Companies and Participating Qualified Plans
and/or the Investment Managers, at least annually, will submit to the Board such
reports, materials or data as the Board may reasonably request so that the Board
may fully carry out obligations imposed upon it by the conditions contained in
the application. Such reports, materials and data will be submitted more
frequently if deemed appropriate by the Board. The obligations of the
Participating Insurance Companies and Participating Qualified Plans to provide
these reports, materials and data to the Board, when the Board so reasonably
requests, shall be a contractual obligation of all Participating Insurance
Companies and Participating Qualified Plans under their agreements governing
Participation in the Funds.
13. If a Qualified Plan should ever become a holder of ten percent or more of
the assets of a Fund, such Qualified Plan will execute a participation agreement
with the Fund that includes the conditions set forth herein to the extent
applicable. A Qualified Plan will execute an application containing an
acknowledgment of this condition upon such Qualified Plan's initial purchase of
the shares of any Fund.
Conclusion:
Applicants assert that, for the reasons summarized above, the requested
exemptions are appropriate in the public interest and consistent with the
protection of investors and the purposes fairly intended by the policy and
provisions of the 1940 Act.
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
H-9
Xxxxxxxxx Variable Products Series Fund, et al.
File No. 812-11698
SECURITIES AND EXCHANGE COMMISSION
Release No. IC-24079
1999 SEC LEXIS 2177
October 13, 1999
ACTION: Order Granting Exemptions
TEXT: Xxxxxxxxx Variable Products Series Fund ("Xxxxxxxxx Trust"), Franklin
Xxxxxxxxx Variable Insurance Products Trust ("VIP Trust"), Xxxxxxxxx Funds
Annuity Company ("TFAC") or any successor to TFAC, and any future open-end
investment company for which TFAC or any affiliate is the administrator,
sub-administrator, investment manager, adviser, principal underwriter, or
sponsor ("Future Funds") filed an application on July 14, 1999, and an amendment
on September 17, 1999 seeking an amended order of the Commission pursuant to
Section 6(c) of the Investment Company Act of 1940 ("1940 Act") exempting them
from the provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act and
Rules 6e-2(b)(l5) and 6e-3(T)(b)(15). The prior order (Rel. No. IC-19879)
granted exemptive relief to permit shares of the Xxxxxxxxx Trust to be sold to
and held by variable annuity and variable life insurance separate accounts of
both affiliated and unaffiliated life insurance companies. The proposed relief
would amend the prior order to add as parties to that order the VIP Trust and
any Future Funds and to permit shares of the Xxxxxxxxx Trust, the VIP Trust, and
Future Funds to be issued to and held by qualified pension and retirement plans
outside the separate account context.
A notice of the filing of the application was issued on September 17, 1999 (Rel.
No. IC-24018). The notice gave interested persons an opportunity to request a
hearing and stated that on order granting the application would be issued unless
a hearing should be ordered. No request for a hearing has been filed, and the
Commission has not ordered a hearing.
The matter has been considered, and it is found that granting the requested
exemptions is appropriate in the public interest and consistent with the
protection of investors and the purposes intended by the policy and provisions
of the 1940 Act.
Accordingly,
IT IS ORDERED, pursuant to Section 6(c) of the 1940 Act, that the requested
exemptions from Sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and Rules
6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, be, and hereby are, granted,
effective forthwith.
For the Commission, by the Division of Investment Management, pursuant to
delegated authority.
H-10
AMENDMENT TO
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us") and Hartford Life Insurance Company and Hartford Life and
Annuity Insurance Company (together "you"), Hartford Securities Distribution
Company, Inc. and Hartford Equity Sales Company, Inc., your distributor, on your
behalf and on behalf of certain Accounts, have previously entered into a
Participation Agreement -- Hartford Non-Leaders dated May 1, 2000 (the
"Agreement"). The parties now desire to amend the Agreement in this amendment
(the "Amendment").
The purpose of the Amendment is to document the intentions of the parties to
communicate, process and settle purchase and redemptions for shares
(collectively, "share transactions") via the Fund/SERV and Networking systems of
the National Securities Clearing Corporation ("NSCC").
For purposes of this Amendment, "Fund/SERV" shall mean NSCC's Mutual Fund
Settlement, Entry and Registration Verification System, a system for automated,
centralized processing of mutual fund purchase and redemption orders,
settlement, and account registration; "Networking" shall mean NSCC's system that
allows mutual funds and life insurance companies to exchange account level
information electronically; and "Settling Bank" shall mean the entity appointed
by the Trust or you, as applicable, to perform such settlement services on
behalf of the Trust and you, as applicable, which entity agrees to abide by
NSCC's then current rules and procedures insofar as they relate to same day
funds settlement. In all cases, processing and settlement of share transactions
shall be done in a manner consistent with applicable law.
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. In lieu of applicable provisions set forth in Section 3 of the Agreement,
the parties agree to provide pricing information, execute orders and wire
payments for purchases and redemptions through NSCC and its subsidiary systems,
and such activities will be governed by the provisions set forth in this
Amendment as follows:
1.1 We will furnish to you through NSCC's Networking or Mutual Fund
Profile System: (i) the most current net asset value information for each
Portfolio; (ii) a schedule of anticipated dividend and distribution payment
dates for each Portfolio, which is subject to change without prior notice,
ordinary income and capital gain dividend rates on the Portfolio's ex-date;
and (iii) in the case of fixed income funds that declare daily dividends,
the daily accrual or the interest rate factor. All such information shall
be furnished to you by 6:30 p.m. Eastern Time on each Business Day or at
such other time as that information becomes available.
1.2 Upon receipt of Portfolio purchase, exchange and redemption
instructions for acceptance as of the time at which a Portfolio's net asset
value is calculated as specified in such Portfolio's prospectus ("close of
trading") on each Business Day ("Instructions"), and upon your
determination that there are good funds with respect to Instructions
involving the purchase of shares, you will calculate the net purchase or
redemption order for each Portfolio.
1.3 On each Business Day, you shall aggregate all purchase and redemption
orders for shares of a Portfolio that you received prior to the close of
trading. Orders for net purchases or net redemptions derived from
Instructions received by you prior to the close of trading on any given
Business Day will be sent to Fund/SERV by 6:00 a.m. Eastern Time, 3:00 a.m.
Pacific Time, on the next Business Day. Subject to your compliance with the
foregoing, you will be considered the designee of the Underwriter and the
Portfolios, and the Business Day on which Instructions are received by you
in proper form prior to the close of trading will be the date as of which
shares of the Portfolios are deemed purchased, exchanged or redeemed
pursuant to such Instructions. Instructions received in proper form by you
after the close of trading on any given Business Day shall not be
transmitted to NSCC prior to the following Business Day and will be treated
as if received on the next following Business Day. Dividends and capital
gain distributions will be automatically reinvested at net asset value in
accordance with the Portfolio's then current prospectuses.
1.4 All orders are subject to acceptance by Underwriter and become
effective only upon confirmation by Underwriter. Underwriter reserves the
right: (i) not to accept any specific order for the purchase or exchange of
shares through Fund/SERV; and (ii) to require any redemption order to be
settled outside of Fund/SERV, in which case the order shall not be
"confirmed" by Underwriter, but
2
rather shall be accepted for redemption in accordance with Section 3.7 of
the Agreement.
1.5 All trades placed through Fund/SERV and confirmed by Underwriter via
Fund/SERV shall settle in accordance with Underwriter's profile within
Fund/SERV applicable to you. Underwriter agrees to provide you with account
positions and activity data relating to share transactions via Networking.
1.6 You will wire payment for net purchase orders by the Trust's NSCC Firm
Number, in immediately available funds, to an NSCC settling bank account
designated by you in accordance with NSCC rules and procedures on the same
Business Day such purchase orders are communicated to NSCC. For purchases
of shares of daily dividend accrual funds, those shares will not begin to
accrue dividends until the day the payment for those shares is received.
1.7 NSCC will wire payment for net redemption orders by the Trust, in
immediately available funds, to an NSCC settling bank account designated by
you in accordance with NSCC rules and procedures on the Business Day such
redemption orders are communicated to NSCC, except as provided in the
Trust's prospectus and statement of additional information.
1.8 If on any specific day you or Underwriter are unable to meet the NSCC
deadline for the transmission of purchase or redemption orders for that
day, a party may at its option transmit such orders and make such payments
for purchases and redemptions directly to you or us, as applicable, as is
otherwise provided in the Agreement; provided, however, that we must
receive written notification from you by 6:00 a.m. Pacific time on any day
that you wish to transmit such orders and/or make such payments directly to
us.
1.9 In the event that you or we are unable to or prohibited from
electronically communicating, processing or settling share transactions via
Fund/SERV, you or we shall notify the other, including providing the
notification provided in Section 1.8 , above. After all parties have been
notified, you and we shall submit orders using manual transmissions as is
otherwise provided in the Agreement.
1.10 These procedures are subject to any additional terms in each
Portfolio's prospectus and the requirements of applicable law. The Trust's
Board of Trustees ("Trustees") may refuse to sell shares of any Portfolio
to any person, or may suspend or terminate the offering of shares of any
Portfolio if such action is required by law or regulatory authorities
having jurisdiction or if, in the sole discretion of the Trustees, they
deem such action to be in the best interests of the shareholders of such
Portfolio.
3
2. New Section 2.4.3 of the Agreement is hereby added as follows:
2.4.3. You and Underwriter represent and warrant that each: (a) has
entered into an agreement with NSCC; (b) has met and will continue to meet
all of the requirements to participate in Fund/SERV and Networking; (c)
intends to remain at all times in compliance with the then current rules
and procedures of NSCC, all to the extent necessary or appropriate to
facilitate such communications, processing, and settlement of share
transactions; and (d) will notify the other party if there is a change in
or a pending failure with respect to its agreement with NSCC.
3. A new Section 7.1.5 is hereby added to the Agreement as follows:
7.1.5 In consideration for orders for the purchase, exchange or sale of
shares of the Portfolios communicated by you by way of Fund/SERV, you shall
further indemnify and hold harmless Indemnified Parties from and against
all Losses that may arise in connection with any orders for the purchase,
exchange or sale of shares of the Portfolios communicated by you or your
agents by way of Fund/SERV, including but not limited to Losses resulting
from Instructions involving investment in incorrect Portfolios or any
fraudulent or unauthorized transaction by either you or your Contract owner
through no fault of the Indemnified Parties. You shall also reimburse the
Trust and Underwriter for any legal or other expenses reasonably incurred
by them in connection with investigating or defending against such Losses.
This indemnity agreement is in addition to any other liability that you may
otherwise have.
This Amendment is executed effective as of January 20, 2004.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment.
The Trust: Franklin Xxxxxxxxx Variable Insurance
Products Trust
ONLY ON BEHALF OF
EACH PORTFOLIO LISTED
ON SCHEDULE C OF
THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
The Underwriter: Franklin/Xxxxxxxxx Distributors, Inc.
By: /s/ Xxxxxx X. Xxxx
------------------------------------
Name: Xxxxxx X. Xxxx
Title: Senior Vice President
4
The Company: Hartford Life Insurance Company
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
Hartford Life and Annuity Insurance
Company
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
Distributor for the Company Hartford Securities Distribution
Company, Inc.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
Hartford Equity Sales Company, Inc.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Name: Xxxxxx Xxxxx
Title: Senior Vice President
5
AMENDMENT NO. 2 TO
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
As of May 1, 2006
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company,
Hartford Life and Annuity Insurance Company,
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company, Hartford Life and Annuity
Insurance Company ("you"), and Hartford Securities Distribution Company, Inc.,
your distributor, and Hartford Equity Sales Company, Inc. on your behalf and on
behalf of certain Accounts, have previously entered into a Participation
Agreement dated May 1, 2000 and subsequently amended January 20, 2004 (the
"Agreement"). The parties now desire to amend the Agreement in this Amendment
(the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Schedules B, C, D and F of the Agreement are hereby deleted and replaced in
their entirety with the following Schedules B, C, D and F, respectively.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 1, 2006.
The Trust: FRANKLIN XXXXXXXXX VARIABLE INSURANCE
PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO LISTED
ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
The Compnay:
HARTFORD LIFE INSURANCE COMPANY HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: [ILLEGIBLE] By: [ILLEGIBLE]
------------------------------ -------------------------
Name: [ILLEGIBLE] Name: [ILLEGIBLE]
Title: Assistant Vice President Title: Assistant Vice President
The Distributor:
HARTFORD SECURITIES DISTRIBUTION HARTFORD EQUITY SALES COMPANY, INC.
COMPANY, INC
By: /s/ Xxxxxx Xxxxxxx By: /s/ Xxxx Xxxxxxx
------------------------------ -------------------------
Name: Xxxxxx Xxxxxxx Name: Xxxx Xxxxxxx
Title: Vice President Title: President
2
SCHEDULE B
ACCOUNTS OF THE COMPANY
1. Name: Hartford Life Insurance Company Separate
Account Three
Date Established: June 22, 1994
SEC Registration Number: 811-08584
2. Name: Hartford Life and Annuity Insurance
Company Separate Account Three
Date Established: June 22, 1994
SEC Registration Number: 811-08580
3. Name: Hartford Life Insurance Company Separate
Account VL I
Date Established: September 18, 1992
SEC Registration Number: 811-03072
4. Name: Hartford Life and Annuity Insurance
Company Separate Account VL I
Date Established: June 8, 1995
SEC Registration Number: 811-07329
5. Name: Hartford Life Insurance Company Separate
Account XX XX
Date Established: September 30, 1994
SEC Registration Number: 811-07271
6. Name: Hartford Life and Annuity Insurance
Company Separate Account XX XX
Date Established: September 30, 1994
SEC Registration Number: 811-07273
7. Name: ICMG Registered Variable Life Separate
Account A
Date Established: April 14, 1998
SEC Registration Number: 811-08913
8. Name: ICMG Registered Variable Life Separate
Account One
Date Established: October 9, 1995
SEC Registration Number: 811-07387
9. Name: Hartford Life Insurance Company Separate
Account Two
Date Established: June 2, 1986
SEC Registration Number: 000-00000-00
3
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST; INVESTMENT ADVISERS
FRANKLIN XXXXXXXXX VARIABLE INSURANCE PRODUCTS TRUST INVESTMENT ADVISER
--------------------------------------------------------------------------------------------------------
Franklin Income Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Rising Dividends Securities Fund -- Class 2 Franklin Advisory Services, Inc.
Franklin Small-Mid Cap Growth Securities Fund -- Class 1 Franklin Advisers, Inc.
Franklin Small-Mid Cap Growth Securities Fund -- Class 2 Franklin Advisers, Inc.
Franklin Small Cap Value Securities Fund -- Class 2 Franklin Advisory Services, Inc.
Franklin Strategic Income Securities Fund -- Class 1 Franklin Advisers, Inc.
Mutual Shares Securities Fund -- Class 2 Franklin Mutual Advisers, LLC
Templeton Developing Markets Securities Fund -- Class 1 Xxxxxxxxx Asset Management Ltd.
Templeton Foreign Securities Fund -- Class 2 Xxxxxxxxx Investment Counsel, LLC
Templeton Growth Securities Fund -- Class 2 Xxxxxxxxx Global Advisors Limited
4
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Variable Company Separate Account Franklin Strategic Income Securities
Company Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets
333-35000 811-08584 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
02 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders (Series II) Company Separate Account Franklin Strategic Income Securities
Company Variable Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets
333-101927 811-08584 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
03 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Variable Insurance Company Separate Franklin Strategic Income Securities
Insurance Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets
333-34998 811-08580 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
04 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders (Series II) Insurance Company Separate Franklin Strategic Income Securities
Insurance Variable Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets
333-101928 811-08580 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
5
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
05 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Outlook Company Separate Account Franklin Strategic Income Securities
Company Variable Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets
333-102625 811-08584 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
06 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Outlook Insurance Company Separate Franklin Strategic Income Securities
Insurance Variable Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets
333-102628 811-08580 Securities Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
07 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Last Company Separate Account XX Xxxxxxxx Strategic Income Securities
Company Survivor Universal II Fund
Life Insurance Yes Xxxxxxxxx Developing Markets
Yes 811-07271 Securities Fund
333-88261 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
08 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Last Insurance Company Separate Franklin Strategic Income Securities
Insurance Survivor Universal Account XX XX Fund
Company Life Insurance Yes Xxxxxxxxx Developing Markets
Yes 811-07273 Securities Fund
333-67373 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
09 Hartford Life Omnisource Variable ICMG Registered Variable CLASS 1 SHARES:
Insurance Life Insurance Life Separate Account A Franklin Strategic Income Securities
Company Yes Yes Fund
333-60515 811-08913 CLASS 2 SHARES:
Franklin Rising Dividends Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
6
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
10 Hartford Life Omnisource Variable ICMG Registered Variable CLASS 1 SHARES:
and Annuity Life Insurance Life Separate Account One Franklin Strategic Income Securities
Insurance Yes Yes Fund
Company 033-63731 811-07387 CLASS 2 SHARES:
Franklin Rising Dividends Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Templeton Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
11 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Insurance Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Yes I Fund
033-53692 Yes Mutual Shares Securities Fund
811-3072
12 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Insurance Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 033-61267 Yes Mutual Shares Securities Fund
811-07329
13 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Artisan Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Yes I Fund
333-07465 Yes Mutual Shares Securities Fund
811-3072
14 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Artisan Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 333-07471 Yes Mutual Shares Securities Fund
811-07329
15 Hartford Life Stag Protector Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Life Insurance I Fund
Yes Yes Mutual Shares Securities Fund
333-94617 811-3072
16 Hartford Life Stag Protector Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-83057 811-07329
17 Hartford Life Stag Accumulator Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Life Insurance I Fund
Yes Yes Mutual Shares Securities Fund
333-50280 811-3072
18 Hartford Life Stag Accumulator Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-93319 811-07329
7
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
19 Hartford Life Stag Wall Street Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-82866 811-07329
20 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Last Survivor Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Yes II Fund
033-89990 Yes Mutual Shares Securities Fund
811-07271
21 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Last Survivor Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account XX XX Fund
Company 033-89988 Yes Mutual Shares Securities Fund
811-07273
22 Hartford Life Stag Variable Life Hartford Life Insurance CLASS 2 SHARES:
Insurance Last Survivor II Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Yes II Fund
333-88261 Yes Mutual Shares Securities Fund
811-07271
23 Hartford Life Stag Variable Life Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Last Survivor II Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account XX XX Fund
Company 333-67373 Yes Mutual Shares Securities Fund
811-07273
24 Hartford Life Stag Protector II Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Life Insurance I Fund
Yes Yes Mutual Shares Securities Fund
333-109530 811-3072
25 Hartford Life Stag Protector II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-88787 811-07329
26 Hartford Life Stag Accumulator II Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Universal Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Life Insurance I Fund
Yes Yes Mutual Shares Securities Fund
333-109529 811-3072
27 Hartford Life Stag Accumulator II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Universal Insurance Company Separate Franklin Small Cap Value Securities
Insurance Life Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-07471 811-07329
28 Hartford Life Hartford Quantum Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Life Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Insurance I Fund
Yes Yes Mutual Shares Securities Fund
333-110550 811-3072
8
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
---------------------------------------------------------------------------------------------------------------------
29 Hartford Life Hartford Quantum Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Life Insurance Company Separate Franklin Small Cap Value Securities
Insurance Insurance Account VL I Fund
Company Yes Yes Mutual Shares Securities Fund
333-110548 811-07329
30 Hartford Life Hartford Quantum II Hartford Life Insurance CLASS 2 SHARES:
Insurance VUL Company Separate Account XX Xxxxxxxx Small Cap Value Securities
Company Yes I Fund
333-127379 Yes Mutual Shares Securities Fund
811-3072
31 Hartford Life Hartford Quantum II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity VUL Insurance Company Separate Franklin Small Cap Value Securities
Insurance Yes Account VL I Fund
Company 333-127380 Yes Mutual Shares Securities Fund
811-07329
32 Hartford Life Hartford Group Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity Company Separate Account Two Franklin Small-Mid Cap Growth
Company Contracts Yes Securities Fund
Yes 000-00000-00 CLASS 2 SHARES:
033-19946 Franklin Income Securities Fund
HV-1452-0
HV-1499-0
9
AMENDMENT NO. 3 TO
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
As of May 1, 2007
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company,
Hartford Life and Annuity Insurance Company,
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"),
Franklin/Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the
Trust, "we" or "us"), Hartford Life Insurance Company, Hartford Life and Annuity
Insurance Company ("you"), and Hartford Securities Distribution Company, Inc.,
your distributor, and Hartford Equity Sales Company, Inc. on your behalf and on
behalf of certain Accounts, have previously entered into a Participation
Agreement dated May 1, 2000 and subsequently amended on May 1, 2006 and January
20, 2004 (the "Agreement"). The parties now desire to amend the Agreement in
this Amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 1 and Section 2.2.1 are hereby each amended to reflect that
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust")
is organized as a statutory trust under the laws of the State of
Delaware.
2. Section 2.3.2 is amended and restated in its entirety as follows:
"2.3.2 Each investment adviser (each, an "Adviser") of a Portfolio,
as indicated in the current prospectus of the Portfolio, is duly
registered as an investment adviser under the Investment Advisers Act
of 1940, as amended or exempt from such registration."
3. Section 3.1.3 is amended and restated in its entirety as follows:
"3.1.3 We agree that shares of the Trust will be sold only to: (i)
life insurance companies which have entered into fund participation
agreements with the Trust ("Participating Insurance Companies") and
their separate accounts or to qualified
pension and retirement plans in accordance with the terms of the
Shared Funding Order; and (ii) investment companies in the form of
funds of funds. No shares of any Portfolio will be sold to the general
public."
4. Section 5.2 is amended and restated in its entirety as follows:
"5.2 If and to the extent required by law, you shall: (i) solicit
voting instructions from Contract owners; (ii) vote the Trust shares
in accordance with the instructions received from Contract owners; and
(iii) vote Trust shares owned by subaccounts for which no instructions
have been received from Contract owners in the same proportion as
Trust shares of such Portfolio for which instructions have been
received from Contract owners; so long as and to the extent that the
SEC continues to interpret the 1940 Act to require pass-through voting
privileges for variable contract owners. You reserve the right to vote
Trust shares held in any Account in your own right, to the extent
permitted by law."
5. Schedules B, C, D and F of the Agreement are hereby deleted and
replaced in their entirety with the following Schedules B, C, D and
F, respectively.
6. All other terms and provisions of the Agreement not amended herein
shall remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 1, 2007.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
2
The Company: HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
Title: Vice President & Director,
Distribution
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
Title: Vice President & Director,
Distribution
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Executive Vice President,
Individual Life
HARTFORD EQUITY SALES COMPANY, INC.
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Executive Vice President,
Individual Life
3
SCHEDULE B
ACCOUNTS OF THE COMPANY
THE COMPANY SEC REGISTRATION
NAME OF ACCOUNTS YES/NO
--------------------------------------------------------------------------------------
HARTFORD LIFE INSURANCE COMPANY
Hartford Life Insurance Company Separate Account Three Yes
Hartford Life Insurance Company Separate Account Two Yes
Hartford Life Insurance Company Separate Account VL I Yes
Hartford Life Insurance Company Separate Account XX XX Yes
ICMG Registered Variable Life Separate Account A Yes
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
Hartford Life and Annuity Insurance Company Separate Account Three Yes
Hartford Life and Annuity Insurance Company Separate Account VL I Yes
Hartford Life and Annuity Insurance Company Separate Account XX XX Yes
ICMG Registered Variable Life Separate Account One Yes
4
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST
1. Franklin Income Securities Fund -- Class 2
2. Franklin Rising Dividends Securities Fund -- Class 2
3. Franklin Small-Mid Cap Growth Securities Fund -- Class 1
4. Franklin Small-Mid Cap Growth Securities Fund -- Class 2
5. Franklin Small Cap Value Securities Fund -- Class 2
6. Franklin Strategic Income Securities Fund -- Class 1
7. Mutual Discovery Securities Fund -- Class 2
8. Mutual Shares Securities Fund -- Class 2
9. Xxxxxxxxx Developing Markets Securities Fund -- Class 1
10. Xxxxxxxxx Foreign Securities Fund -- Class 2
11. Xxxxxxxxx Global Income Securities Fund -- Class 2
12. Xxxxxxxxx Growth Securities Fund -- Class 2
5
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Select Hartford Life Insurance Class 1 Shares:
Insurance Leaders Variable Company Separate Account Franklin Strategic Income Securities
Company Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets Securities
333-35000 811-08584 Fund
Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
02 Hartford Life Hartford Select Hartford Life Insurance Class 1 Shares:
Insurance Leaders (Series Company Separate Account Franklin Strategic Income Securities
Company II) Variable Three Fund
Annuity Yes Xxxxxxxxx Developing Markets Securities
Yes 811-08584 Fund
333-101927 Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
03 Hartford Life Hartford Select Hartford Life and Annuity Class 1 Shares:
and Annuity Leaders Variable Insurance Company Separate Franklin Strategic Income Securities
Insurance Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-34998 811-08580 Fund
Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
04 Hartford Life Hartford Select Hartford Life and Annuity Class 1 Shares:
and Annuity Leaders (Series Insurance Company Separate Franklin Strategic Income Securities
Insurance II) Variable Account Three Fund
Company Annuity Yes Xxxxxxxxx Developing Markets Securities
Yes 811-08580 Fund
333-101928 Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
6
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
05 Hartford Life Hartford Select Hartford Life Insurance Class 1 Shares:
Insurance Leaders Outlook Company Separate Account Franklin Strategic Income Securities
Company Variable Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets Securities
333-102625 811-08584 Fund
Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
06 Hartford Life Hartford Select Hartford Life and Annuity Class 1 Shares:
and Annuity Leaders Outlook Insurance Company Separate Franklin Strategic Income Securities
Insurance Variable Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-102628 811-08580 Fund
Class 2 Shares:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
07 Hartford Life Hartford Select Hartford Life Insurance Class 1 Shares:
Insurance Leaders Last Company Separate Franklin Strategic Income Securities
Company Survivor Account XX XX Fund
Universal Life Yes Xxxxxxxxx Developing Markets Securities
Insurance 811-07271 Fund
Yes Class 2 Shares:
333-88261 Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
08 Hartford Life Hartford Select Hartford Life and Annuity Class 1 Shares:
and Annuity Leaders Last Insurance Company Separate Franklin Strategic Income Securities
Insurance Survivor Account XX XX Fund
Company Universal Life Yes Xxxxxxxxx Developing Markets Securities
Insurance 811-07273 Fund
Yes Class 2 Shares:
333-67373 Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
09 Hartford Life Omnisource ICMG Registered Variable Class 1 Shares:
Insurance Variable Life Life Separate Account A Franklin Strategic Income Securities
Company Insurance Yes Fund
Yes 811-08913 Class 2 Shares:
333-60515 Franklin Rising Dividends Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
7
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
10 Hartford Life Omnisource ICMG Registered Variable Class 1 Shares:
and Annuity Variable Life Life Separate Account One Franklin Strategic Income Securities
Insurance Insurance Yes Fund
Company Yes 811-07387 Class 2 Shares:
033-63731 Franklin Rising Dividends Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
11 Hartford Life Stag Variable Hartford Life Insurance Class 2 Shares:
Insurance Life Insurance Company Separate Franklin Income Securities Fund
Company Yes Account XX X Xxxxxxxx Small Cap Value Securities
033-53692 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
12 Hartford Life Stag Variable Hartford Life and Annuity Class 2 Shares:
and Annuity Life Insurance Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 033-61267 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
13 Hartford Life Stag Variable Hartford Life Insurance Class 2 Shares:
Insurance Life Artisan Company Separate Franklin Income Securities Fund
Company Yes Account XX X Xxxxxxxx Small Cap Value Securities
333-07465 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
14 Hartford Life Stag Variable Hartford Life and Annuity Class 2 Shares:
and Annuity Life Artisan Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 333-07471 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
15 Hartford Life Stag Protector Hartford Life Insurance Class 2 Shares:
Insurance Variable Company Separate Franklin Income Securities Fund
Company Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-94617 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Templeton Growth Securities Fund
8
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
16 Hartford Life Stag Protector Hartford Life and Annuity Class 2 Shares:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-83057 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
17 Hartford Life Stag Accumulator Hartford Life Insurance Class 2 Shares:
Insurance Variable Company Separate Franklin Income Securities Fund
Company Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-50280 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
18 Hartford Life Stag Accumulator Hartford Life and Annuity Class 2 Shares:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-93319 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
19 Hartford Life Stag Wall Street Hartford Life and Annuity Class 2 Shares:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-82866 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
20 Hartford Life Stag Variable Hartford Life Insurance Class 2 Shares:
Insurance Life Last Company Separate Franklin Income Securities Fund
Company Survivor Account XX XX Franklin Small Cap Value Securities
Yes Yes Fund
033-89990 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
21 Hartford Life Stag Variable Hartford Life and Annuity Class 2 Shares:
and Annuity Life Last Insurance Company Separate Franklin Income Securities Fund
Insurance Survivor Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
033-89988 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
22 Hartford Life Stag Variable Hartford Life Insurance Class 2 Shares:
Insurance Life Last Company Separate Franklin Income Securities Fund
Company Survivor II Account XX XX Franklin Small Cap Value Securities
Yes Yes Fund
333-88261 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
9
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
23 Hartford Life Stag Variable Hartford Life and Annuity Class 2 Shares:
and Annuity Life Last Insurance Company Separate Franklin Income Securities Fund
Insurance Survivor II Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
333-67373 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
24 Hartford Life Stag Protector II Hartford Life Insurance Class 2 Shares:
Insurance Variable Company Separate Franklin Income Securities Fund
Company Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-109530 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
25 Hartford Life Stag Protector II Hartford Life and Annuity Class 2 Shares:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-88787 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
26 Hartford Life Stag Accumulator Hartford Life Insurance Class 2 Shares:
Insurance II Variable Company Separate Franklin Income Securities Fund
Company Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-109529 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
27 Hartford Life Stag Accumulator Hartford Life and Annuity Class 2 Shares:
and Annuity II Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-07471 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
28 Hartford Life Hartford Quantum Hartford Life Insurance Class 2 Shares:
Insurance Variable Life Company Separate Franklin Income Securities Fund
Company Insurance Account XX X Xxxxxxxx Small Cap Value Securities
Yes Yes Fund
333-110550 811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
29 Hartford Life Hartford Quantum Hartford Life and Annuity Class 2 Shares:
and Annuity Variable Life Insurance Company Separate Franklin Income Securities Fund
Insurance Insurance Account XX X Xxxxxxxx Small Cap Value Securities
Company Yes Yes Fund
333-110548 811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities Fund
Xxxxxxxxx Growth Securities Fund
10
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
30 Hartford Life Hartford Quantum II Hartford Life Insurance Class 2 Shares:
Insurance VUL Company Separate Franklin Income Securities Fund
Company Yes Account XX X Xxxxxxxx Small Cap Value Securities
333-127379 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
31 Hartford Life Hartford Quantum II Hartford Life and Annuity Class 2 Shares:
and Annuity VUL Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 333-127380 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
32 Hartford Life Hartford Variable Hartford Life Insurance Class 2 Shares:
Insurance Universal Life Last Company Separate Franklin Income Securities Fund
Company Survivor Account XX XX Franklin Small Cap Value Securities
Yes Yes Fund
333-131133 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
33 Hartford Life Hartford Variable Hartford Life and Annuity Class 2 Shares:
and Annuity Universal Life Last Insurance Company Separate Franklin Income Securities Fund
Insurance Survivor Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
333-131135 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
34 Hartford Life Hartford Group Hartford Life Insurance Class 1 Shares:
Insurance Variable Annuity Company Separate Account Two Franklin Small-Mid Cap Growth
Company Contracts Yes Securities Fund
Yes 000-00000-00 Class 2 Shares:
033-19946 Franklin Income Securities Fund
HV-1452-0
HV-1499-0
11
SCHEDULE F
RULE 12b-1 PLANS
COMPENSATION
Each Class 2 Portfolio named on Schedule C of this Agreement is eligible to
receive a maximum annual payment rate of 0.25% stated as a percentage per year
of that Portfolio's Class 2 average daily net assets, pursuant to the terms and
conditions referenced below under its Class 2 Rule 12b-1 Distribution Plan.
AGREEMENT PROVISIONS
If the Company, on behalf of any Account, purchases Trust Portfolio shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees (collectively
"you") provide any activity or service which is primarily intended to assist in
the promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Underwriter, the
Trust or their affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Rule 12b-1 Services" may include, but are not limited to, printing of
prospectuses and reports used for sales purposes, preparing and distributing
sales literature and related expenses, advertisements, education of dealers and
their representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Portfolio, coordinating responses to Contract Owner inquiries
regarding the Portfolios, maintaining such accounts or providing such other
enhanced services as a Trust Portfolio or Contract may require, or providing
other services eligible for service fees as defined under NASD rules. Your
acceptance of such compensation is your acknowledgment that eligible services
have been rendered. All Rule 12b-1 fees, shall be based on the value of Eligible
Shares owned by the Company on behalf of its Accounts, and shall be calculated
on the basis and at the rates set forth in the compensation provisions stated
above. The aggregate annual fees paid pursuant to each Plan shall not exceed the
amounts stated as the "annual maximums" in the Portfolio's prospectus, unless an
increase is approved by shareholders as provided in the Plan. These maximums
shall be a specified percent of the value of a Portfolio's net assets
attributable to Eligible Shares owned by the Company on behalf of its Accounts
(determined in the same manner as the Portfolio uses to compute its net assets
as set forth in its effective Prospectus). The Rule 12b-1 fee will be paid to
you within thirty (30) days after the end of the three-month periods ending in
January, April, July and October.
You shall furnish us with such information as shall reasonably be requested by
the Trust's Boards of Trustees ("Trustees") with respect to the Rule 12b-1 fees
paid to you pursuant to the Plans. We shall furnish to the Trustees, for their
review on a quarterly basis, a written report of the amounts expended under the
Plans and the purposes for which such expenditures were made.
12
The Plans and provisions of any agreement relating to such Plans must be
approved annually by a vote of the Trustees, including the Trustees who are not
interested persons of the Trust and who have no financial interest in the Plans
or any related agreement ("Disinterested Trustees"). Each Plan may be terminated
at any time by the vote of a majority of the Disinterested Trustees, or by a
vote of a majority of the outstanding shares as provided in the Plan, on sixty
(60) days' written notice, without payment of any penalty. The Plans may also be
terminated by any act that terminates the Underwriting Agreement between the
Underwriter and the Trust, and/or the management or administration agreement
between Franklin Advisers, Inc. and its affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees. Under
Rule 12b-1, the Trustees have a duty to request and evaluate, and persons who
are party to any agreement related to a Plan have a duty to furnish, such
information as may reasonably be necessary to an informed determination of
whether the Plan or any agreement should be implemented or continued. Under Rule
12b-1, the Trust is permitted to implement or continue Plans or the provisions
of any agreement relating to such Plans from year-to-year only if, based on
certain legal considerations, the Trustees are able to conclude that the Plans
will benefit each affected Trust Portfolio and class. Absent such yearly
determination, the Plans must be terminated as set forth above. In the event of
the termination of the Plans for any reason, the provisions of this Schedule F
relating to the Plans will also terminate. You agree that your selling
agreements with persons or entities through whom you intend to distribute
Contracts will provide that compensation paid to such persons or entities may be
reduced if a Portfolio's Plan is no longer effective or is no longer applicable
to such Portfolio or class of shares available under the Contracts.
Any obligation assumed by the Trust pursuant to this Agreement shall be limited
in all cases to the assets of the Trust and no person shall seek satisfaction
thereof from shareholders of the Trust. You agree to waive payment of any
amounts payable to you by Underwriter under a Plan until such time as the
Underwriter has received such fee from the Trust.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule F, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable statutes,
rules and regulations of all rule 12b-1 fees received from us in the prospectus
of the Contracts.
13
AMENDMENT NO. 5 TO
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
As of May 1, 2008
by and among
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company,
Hartford Life and Annuity Insurance Company,
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"), Franklin
Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the Trust,
"we" or "us"), Hartford Life Insurance Company, Hartford Life and Annuity
Insurance Company ("you"), and Hartford Securities Distribution Company, Inc.,
your distributor, and Hartford Equity Sales Company, Inc. on your behalf and on
behalf of certain Accounts, have previously entered into a Participation
Agreement dated May 1, 2000 and subsequently amended on January 20, 2004, May 1,
2006, May 1, 2007, and October 1, 2007 (the "Agreement"). The parties now desire
to amend the Agreement by this Amendment (the "Amendment").
Except as modified hereby, all other terms and conditions of the Agreement shall
remain in full force and effect. Unless otherwise indicated, the terms defined
in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. The term "National Association of Securities Dealers, Inc. (the "NASD") is
hereby replaced with "Financial Industry Regulatory Authority ("FINRA")"
throughout the Agreement in sections 2.1.6, 2.3.1, 10.7, 10.8 and Schedule
F, respectively.
2. Schedules C and D of the Agreement are deleted and replaced in their
entirety with the Schedules C and D attached hereto, respectively.
3. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of May 1, 2008.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS,
INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
The Company:
HARTFORD LIFE INSURANCE COMPANY HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By its authorized officer, By its authorized officer,
By: /s/ Xxxx Xxxxxx By: /s/ Xxxx Xxxxxx
----------------------------------- -----------------------------
Name: Xxxx Xxxxxx Name: Xxxx Xxxxxx
Title: Senior Vice President Title: Senior Vice President
The Distributor:
HARTFORD SECURITIES DISTRIBUTION COMPANY, HARTFORD EQUITY SALES COMPANY, INC.
INC
By its authorized officer, By its authorized officer,
By: /s/ Xxxxx Xxxxxx By: /s/ Xxxx Xxxxxx
----------------------------------- -----------------------------
Name: Xxxxx Xxxxxx Name: Xxxx Xxxxxx
Title: Director Title: Senior Vice President
2
SCHEDULE C
AVAILABLE PORTFOLIOS AND CLASSES OF SHARES OF THE TRUST
1. Franklin Flex Cap Growth Securities Fund -- Class 2
2. Franklin Income Securities Fund -- Class 2
3. Franklin Rising Dividends Securities Fund -- Class 2
4. Franklin Small-Mid Cap Growth Securities Fund -- Class 1
5. Franklin Small-Mid Cap Growth Securities Fund -- Class 2
6. Franklin Small Cap Value Securities Fund -- Class 2
7. Franklin Strategic Income Securities Fund -- Class 1
8. Mutual Discovery Securities Fund -- Class 2
9. Mutual Shares Securities Fund -- Class 2
10. Xxxxxxxxx Developing Markets Securities Fund -- Class 1
11. Xxxxxxxxx Foreign Securities Fund -- Class 2
12. Xxxxxxxxx Global Income Securities Fund -- Class 2
13. Xxxxxxxxx Growth Securities Fund -- Class 2
3
SCHEDULE D
CONTRACTS OF THE COMPANY
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
--------------------------------------------------------------------------------------------------------------------
01 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Variable Company Separate Account Franklin Strategic Income Securities
Company Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets Securities
333-35000 811-08584 Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
02 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders (Series Company Separate Account Franklin Strategic Income Securities
Company II) Variable Three Fund
Annuity Yes Xxxxxxxxx Developing Markets Securities
Yes 811-08584 Fund
333-101927 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
03 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Variable Insurance Company Separate Franklin Strategic Income Securities
Insurance Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-34998 811-08580 Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
04 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders (Series Insurance Company Separate Franklin Strategic Income Securities
Insurance II) Variable Account Three Fund
Company Annuity Yes Xxxxxxxxx Developing Markets Securities
Yes 811-08580 Fund
333-101928 CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
05 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Outlook Company Separate Account Franklin Strategic Income Securities
Company Variable Annuity Three Fund
Yes Yes Xxxxxxxxx Developing Markets Securities
333-102625 811-08584 Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
06 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Outlook Insurance Company Separate Franklin Strategic Income Securities
Insurance Variable Annuity Account Three Fund
Company Yes Yes Xxxxxxxxx Developing Markets Securities
333-102628 811-08580 Fund
CLASS 2 SHARES:
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
4
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
07 Hartford Life Hartford Select Hartford Life Insurance CLASS 1 SHARES:
Insurance Leaders Last Company Separate Account Franklin Strategic Income Securities
Company Survivor XX XX Fund
Universal Life Yes Xxxxxxxxx Developing Markets
Insurance 811-07271 Securities Fund
Yes CLASS 2 SHARES:
333-88261 Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
08 Hartford Life Hartford Select Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Leaders Last Insurance Company Separate Franklin Strategic Income Securities
Insurance Survivor Account XX XX Fund
Company Universal Life Yes Xxxxxxxxx Developing Markets
Insurance 811-07273 Securities Fund
Yes CLASS 2 SHARES:
333-67373 Franklin Small-Mid Cap Growth
Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
09 Hartford Life Omnisource ICMG Registered Variable CLASS 1 SHARES:
Insurance Variable Life Life Separate Account A Franklin Strategic Income Securities
Company Insurance Yes Fund
Yes 811-08913 CLASS 2 SHARES:
333-60515 Franklin Rising Dividends Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
10 Hartford Life Omnisource ICMG Registered Variable CLASS 1 SHARES:
and Annuity Variable Life Life Separate Account One Franklin Strategic Income Securities
Insurance Insurance Yes Fund
Company Yes 811-07387 CLASS 2 SHARES:
033-63731 Franklin Rising Dividends Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Franklin Small Cap Value Securities
Fund
Mutual Shares Securities Fund
Xxxxxxxxx Growth Securities Fund
Xxxxxxxxx Foreign Securities Fund
11 Hartford Life Stag Variable Hartford Life Insurance CLASS 2 SHARES:
Insurance Life Insurance Company Separate Account Franklin Income Securities Fund
Company Yes XX X Xxxxxxxx Small Cap Value Securities
033-53692 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
12 Hartford Life Stag Variable Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Life Insurance Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 033-61267 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
5
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
13 Hartford Life Stag Variable Hartford Life Insurance CLASS 2 SHARES:
Insurance Life Artisan Company Separate Account Franklin Income Securities Fund
Company Yes XX X Xxxxxxxx Small Cap Value Securities
333-07465 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
14 Hartford Life Stag Variable Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Life Artisan Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 333-07471 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
15 Hartford Life Stag Protector Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Company Separate Account Franklin Income Securities Fund
Company Universal Life XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-94617 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
16 Hartford Life Stag Protector Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-83057 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
17 Hartford Life Stag Accumulator Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Company Separate Account Franklin Income Securities Fund
Company Universal Life XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-50280 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
18 Hartford Life Stag Accumulator Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-93319 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
19 Hartford Life Stag Wall Street Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-82866 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
6
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
20 Hartford Life Stag Variable Hartford Life Insurance CLASS 2 SHARES:
Insurance Life Last Company Separate Account Franklin Income Securities Fund
Company Survivor XX XX Franklin Small Cap Value Securities
Yes Yes Fund
033-89990 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
21 Hartford Life Stag Variable Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Life Last Insurance Company Separate Franklin Income Securities Fund
Insurance Survivor Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
033-89988 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
22 Hartford Life Stag Variable Hartford Life Insurance CLASS 2 SHARES:
Insurance Life Last Company Separate Account Franklin Income Securities Fund
Company Survivor II XX XX Franklin Small Cap Value Securities
Yes Yes Fund
333-88261 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
23 Hartford Life Stag Variable Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Life Last Insurance Company Separate Franklin Income Securities Fund
Insurance Survivor II Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
333-67373 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
24 Hartford Life Stag Protector II Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Company Separate Account Franklin Income Securities Fund
Company Universal Life XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-109530 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
25 Hartford Life Stag Protector II Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-88787 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
26 Hartford Life Stag Accumulator Hartford Life Insurance CLASS 2 SHARES:
Insurance II Variable Company Separate Account Franklin Income Securities Fund
Company Universal Life XX X Xxxxxxxx Small Cap Value Securities
Insurance Yes Fund
Yes 811-3072 Mutual Discovery Securities Fund
333-109529 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
7
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
27 Hartford Life Stag Accumulator Hartford Life and Annuity CLASS 2 SHARES:
and Annuity II Variable Insurance Company Separate Franklin Income Securities Fund
Insurance Universal Life Account XX X Xxxxxxxx Small Cap Value Securities
Company Insurance Yes Fund
Yes 811-07329 Mutual Discovery Securities Fund
333-07471 Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
28 Hartford Life Hartford Quantum Hartford Life Insurance CLASS 2 SHARES:
Insurance Variable Life Company Separate Account Franklin Income Securities Fund
Company Insurance XX X Xxxxxxxx Small Cap Value Securities
Yes Yes Fund
333-110550 811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
29 Hartford Life Hartford Quantum Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Variable Life Insurance Company Separate Franklin Income Securities Fund
Insurance Insurance Account XX X Xxxxxxxx Small Cap Value Securities
Company Yes Yes Fund
333-110548 811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
30 Hartford Life Hartford Quantum Hartford Life Insurance CLASS 2 SHARES:
Insurance II VUL Company Separate Account Franklin Income Securities Fund
Company Yes XX X Xxxxxxxx Small Cap Value Securities
333-127379 Yes Fund
811-3072 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
31 Hartford Life Hartford Quantum Hartford Life and Annuity CLASS 2 SHARES:
and Annuity II VUL Insurance Company Separate Franklin Income Securities Fund
Insurance Yes Account XX X Xxxxxxxx Small Cap Value Securities
Company 333-127380 Yes Fund
811-07329 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
32 Hartford Life Hartford Variable Hartford Life Insurance CLASS 2 SHARES:
Insurance Universal Life Company Separate Account Franklin Income Securities Fund
Company Last Survivor XX XX Franklin Small Cap Value Securities
Yes Yes Fund
333-131133 811-07271 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
33 Hartford Life Hartford Variable Hartford Life and Annuity CLASS 2 SHARES:
and Annuity Universal life Insurance Company Separate Franklin Income Securities Fund
Insurance Last Survivor Account XX XX Franklin Small Cap Value Securities
Company Yes Yes Fund
333-131135 811-07273 Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
8
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
34 Hartford Life Hartford Group Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Annuity Company Separate Account Franklin Small-Mid Cap Growth
Company Contracts Two Securities Fund
Yes Yes CLASS 2 SHARES:
033-19946 811-03072-01 Franklin Income Securities Fund
HV-1452-0
HV-1499-0
35 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Company Separate Account Franklin Strategic Income Securities
Company Universal Life XX XX Fund
Liberty Yes Xxxxxxxxx Developing Markets
Yes 811-07271 Securities Fund
333-148814 CLASS 2 SHARES:
Franklin Flex Cap Growth Securities
Fund
Franklin Income Securities Fund
Franklin Small Cap Value Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
36 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Insurance Company Separate Franklin Strategic Income Securities
Insurance Universal Life Account XX XX Fund
Company Liberty Yes Xxxxxxxxx Developing Markets
Yes 811-07273 Securities Fund
333-148816 CLASS 2 SHARES:
Franklin Flex Cap Growth Securities
Fund
Franklin Income Securities Fund
Franklin Small Cap Value Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
37 Hartford Life Hartford Leaders Hartford Life Insurance CLASS 1 SHARES:
Insurance Variable Company Separate Account Franklin Strategic Income Securities
Company Universal Life XX XX Fund
Legacy Yes Xxxxxxxxx Developing Markets
Yes 811-07271 Securities Fund
333-148817 CLASS 2 SHARES:
Franklin Flex Cap Growth Securities
Fund
Franklin Income Securities Fund
Franklin Small Cap Value Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Xxxxxxxxx Growth Securities Fund
9
PRODUCT NAME SEPARATE ACCOUNT NAME
INSURANCE REGISTERED Y/N REGISTERED Y/N
# COMPANY 1933 ACT # 1940 ACT # CLASSES OF SHARES AND PORTFOLIOS
-------------------------------------------------------------------------------------------------------------
38 Hartford Life Hartford Leaders Hartford Life and Annuity CLASS 1 SHARES:
and Annuity Variable Insurance Company Separate Franklin Strategic Income Securities
Insurance Universal Life Account XX XX Fund
Company Legacy Yes Xxxxxxxxx Developing Markets
Yes 811-07273 Securities Fund
333-148815 CLASS 2 SHARES:
Franklin Flex Cap Growth Securities
Fund
Franklin Income Securities Fund
Franklin Small Cap Value Securities
Fund
Franklin Small-Mid Cap Growth
Securities Fund
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Xxxxxxxxx Foreign Securities Fund
Xxxxxxxxx Global Income Securities
Fund
Templeton Growth Securities Fund
10
AMENDMENT NO. 6 TO
PARTICIPATION AGREEMENT -- HARTFORD NON-LEADERS
Franklin Xxxxxxxxx Variable Insurance Products Trust
Franklin/Xxxxxxxxx Distributors, Inc.
Hartford Life Insurance Company,
Hartford Life and Annuity Insurance Company,
Hartford Securities Distribution Company, Inc.
Hartford Equity Sales Company, Inc.
Franklin Xxxxxxxxx Variable Insurance Products Trust (the "Trust"), Franklin
Xxxxxxxxx Distributors, Inc. (the "Underwriter," and together with the Trust,
"we" or "us"), Hartford Life Insurance Company, Hartford Life and Annuity
Insurance Company (together the "Company" or "you"), and Hartford Securities
Distribution Company, Inc. and Hartford Equity Sales Company, Inc., (together
the "Distributor"), on your behalf and on behalf of certain Accounts, have
previously entered into a Participation Agreement dated May 1, 2000, and
subsequently amended January 20, 2004, May 1, 2006, May 1, 2007, October 1, 2007
and May 1, 2008 (the "Agreement"). The parties now desire to amend the Agreement
by this amendment (the "Amendment"). Unless otherwise indicated, the terms
defined in the Agreement shall have the same meaning in this Amendment.
AMENDMENT
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the Agreement as follows:
1. Section 6 is amended and restated in its entirety as set forth in
Attachment A to this Amendment.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect.
IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers
to execute this Amendment effective as of September 22, 2010.
The Trust: FRANKLIN XXXXXXXXX VARIABLE
INSURANCE PRODUCTS TRUST
ONLY ON BEHALF OF EACH PORTFOLIO
LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
The Underwriter: FRANKLIN/XXXXXXXXX DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
The Company: HARTFORD LIFE INSURANCE COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title:
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title:
The Distributor: HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title:
HARTFORD EQUITY SALES COMPANY, INC.
By its authorized officer,
By: /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title:
2
ATTACHMENT A
6. SALES MATERIAL, INFORMATION AND TRADEMARKS
6.1 For purposes of this Section 6, "Sales Literature/ Promotional Material"
includes, but is not limited to, portions of the following that use any logo or
other trademark related to the Trust, or Underwriter or its affiliates, or refer
to the Trust: advertisements (such as material published or designed for use in
a newspaper, magazine or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures, web-sites
and other electronic communications or other public media), sales literature
(i.e., any written communication distributed or made generally available to
customers or the public, including brochures, circulars, research reports,
market letters, form letters, seminar texts, reprints or excerpts or any other
advertisement, sales literature or published article or electronic
communication), educational or training materials or other communications
distributed or made generally available to some or all agents or employees in
any media, and disclosure documents, shareholder reports and proxy materials.
6.2 You may use the name of the Trust and trademarks and the logo of the
Underwriter in Sales Literature/Promotional Material as reasonably necessary to
carry out your performance and obligations under this Agreement provided that
you comply with the provisions of this Agreement. You agree to abide by any
reasonable use guidelines regarding use of such trademarks and logos that we may
give from time to time. You shall, as we may request from time to time, promptly
furnish, or cause to be furnished to us or our designee, at least one complete
copy of each registration statement, prospectus, statement of additional
information, private placement memorandum, retirement plan disclosure
information or other disclosure documents or similar information, as applicable
(collectively "Disclosure Documents"), as well as any report, solicitation for
voting instructions, Sales Literature/Promotional Material created and approved
by you, and all amendments to any of the above that relate to the Contracts, the
Accounts, the Trust, or Underwriter or its affiliates.
6.3 You and your agents shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust,
the Underwriter or an Adviser, other than information or representations
contained in and accurately derived from the registration statement or
prospectus for the Trust shares (as such registration statement and prospectus
may be amended or supplemented from time to time), annual and semi-annual
reports of the Trust, Trust-sponsored proxy statements, or in Sales
Literature/Promotional Material created by us for the Trust and provided by the
Trust or its designee to you, except as required by legal process or regulatory
authorities or with the written permission of the Trust or its designee.
6.4 You agree, represent and warrant that you are solely responsible for any
Sales Literature/ Promotional Material prepared by you and that such material
will: (a) conform to all requirements of any applicable laws or regulations of
any government or authorized agency having jurisdiction over the offering or
sale of shares of the Portfolios or Contracts; (b) be solely based upon and not
contrary to or inconsistent with the information or materials
4
provided to you by us or a Portfolio; and (c) be made available promptly to us
upon our request. You agree to file any Sales Literature/Promotional Material
prepared by you with FINRA, or other applicable legal or regulatory authority,
within the timeframes that may be required from time to time by FINRA or such
other legal or regulatory authority. Unless otherwise expressly agreed to in
writing, it is understood that we will neither review nor approve for use any
materials prepared by you and will not be materially involved in the preparation
of, or have any responsibility for, any such materials prepared by you. You are
not authorized to modify or translate any materials we have provided to you.
6.5 You shall promptly notify us of any written customer complaint or notice of
any regulatory investigation or proceeding received by you relating to any
Disclosure Documents or Sales Literature/Promotional Material that reference the
Trust or a Portfolio.
6.6 We shall not give any information or make any representations or statements
on behalf of you or concerning you, the Accounts or the Contracts other than
information or representations, including naming you as a Trust shareholder,
contained in and accurately derived from Disclosure Documents for the Contracts
(as such Disclosure Documents may be amended or supplemented from time to time),
or in materials approved by you for distribution, including Sales Literature/
Promotional Material, except as required by legal process or regulatory
authorities or with your written permission.
6.7 Except as provided in Section 6.2, you shall not use any designation
comprised in whole or part of the names or marks "Franklin" or "Xxxxxxxxx" or
any logo or other trademark relating to the Trust or the Underwriter without
prior written consent, and upon termination of this Agreement for any reason,
you shall cease all use of any such name or xxxx as soon as reasonably
practicable.
6.8 You shall furnish to us ten (10) Business Days prior to its first
submission to the SEC or its staff, any request or filing for no-action
assurance or exemptive relief naming, pertaining to, or affecting, the Trust,
the Underwriter or any of the Portfolios.
6.9 You agree that any posting of Designated Portfolio Documents on your
website or use of Designated Portfolio Documents in any other electronic format
will result in the Designated Portfolio Documents: (i) appearing identical to
the hard copy printed version or .pdf format file provided to you by us (except
that you may reformat .pdf format prospectus files in order to delete blank
pages and to insert .pdf format prospectus supplement files provided by us to
you); (ii) being clearly associated with the particular Contracts in which they
are available; (iii) having no less prominence than prospectuses of any other
underlying funds available under the Contracts; and (iv) being used in an
authorized manner. Notwithstanding the above, you understand and agree that you
are responsible for ensuring that participation in the Portfolios, and any
website posting, or other use, of the Designated Portfolio Documents is in
compliance with this Agreement, including Section 4.6 of the Agreement. We
reserve the right to inspect and review your website if any Designated Portfolio
Documents and/or other Trust documents are posted on your website and you shall,
upon our reasonable request, provide us timely access to your website materials
to perform such inspection and review.
5
In addition, you agree to be solely responsible for maintaining and updating the
Designated Portfolio Documents' .pdf files, to the extent that revised
Designated Portfolio Documents are made available to you, and removing and/or
replacing promptly any outdated prospectuses and other documents, as necessary,
ensuring that any accompanying instructions by us, for using or stopping use,
are followed. You agree to designate and make available to us a person to act as
a single point of communication contact for these purposes. We are not
responsible for any additional costs or additional liabilities that may be
incurred as a result of your election to place the Designated Portfolio
Documents on your website. We reserve the right to revoke this authorization, at
any time and for any reason, although we may instead make our authorization
subject to new procedures.
6
