SHAREHOLDER INFORMATION AGREEMENT
SHAREHOLDER INFORMATION AGREEMENT entered into as of April 16, 2007 by and
between MFS Fund Distributors, Inc. ("MFD") and Phoenix Life Insurance Company
("Agent") with an effective date of October 16, 2007.
WHEREAS, MFD is the principal underwriter for the MFS Funds;
WHEREAS, the Valley Forge Life Insurance Company "Intermediary" is a
manufacturer of variable life and variable annuity insurance products;
WHEREAS, Phoenix Life Insurance Company is the agent for the Intermediary in
terms of the administration of the variable life and variable annuity insurance
products;
WHEREAS, the Intermediary and MFD or certain of the MFS funds have entered into
Participation Agreements allowing the Intermediary to offer certain MFS funds
through its Separate Accounts by way of the Intermediary's variable life and
variable annuity insurance products;
WHEREAS, Rule 22c-2 of the Investment company Act of 1940, as amended, ("Act")
requires every mutual fund company or its principal underwriter to enter into
written agreements with financial intermediaries obligating each financial
intermediary to provide certain shareholder information as defined by Rule 22c-2
("Rule") of the Act. The Rule also obligates the financial intermediary to
execute instructions from the fund company should the fund company determine
that a shareholder's trading activity violates the fund's short-term trading
policies;
WHEREAS, Rule 22c-2 allows the agent to enter into shareholder agreements on the
Intermediary's behalf;
WHEREAS, the MFD and the Agent enter into this Shareholder Information Agreement
("Agreement") to comply with the requirements of the Rule;
NOW, in consideration of the mutual covenants contained in this Agreement, the
parties intend to be legally bound and agree to the following:
I. DEFINITIONS
1.1 - Intermediary: The term "Intermediary" means an insurance company separate
account offering any of the Fund's insurance dedicated mutual funds ("Separate
Account") and/or the insurance company acting as the depositor for the Separate
Account as well as the Agent administering the functions of the Separate Account
with respect to the Intermediary's variable life and annuity business.
1.2 - Fund: The term "Fund" shall mean an open-ended management investment
company that is registered or required to register under Section 8 of the Act.
The term "Fund" includes (i) an investment adviser to or administrator for the
Fund; (ii) the principal underwriter or distributor for the Fund; or (iii) the
transfer agent for the Fund. The term not does include any "excepted funds" as
defined in Rule 22c-2(b) under the Act.
1.3 - Shares: The term "Shares" means the interests of Shareholders
corresponding to the redeemable securities of record issued by the Fund under
the Act that are held by the Intermediary.
1.4-Shareholder: The term "Shareholder" means the holder of interests in a
variable annuity or variable life insurance contract issued contract by the
Intermediary ("Contract"), or a participant in an employee benefit plan with a
beneficial interest in a contract.
1.5-Shareholder -Initiated Transfer Purchase: The term "Shareholder-Initiated
Transfer Purchase" means a transaction that is initiated or directed by a
Shareholder that results in a transfer of assets within a Contract to a Fund,
but does not include transactions that are executed: (i) automatically pursuant
to a contractual or systematic program or enrollment such as transfer of assets
within a Contract to a Fund as a result of "dollar cost averaging" programs,
insurance company approved asset allocation programs, or automatic rebalancing
programs; (ii) pursuant to a Contract death benefit; (iii) one-time step-up in
Contract value pursuant to a Contract death benefit; (iv) allocation of assets
to a Fund through a Contract as a result of payments such as loan repayments,
scheduled contributions, retirement plan salary reduction contributions, or
planned premium payments to the Contract; or (v) prearranged transfers at the
conclusion of a required free look period.
1.6-Shareholder Initiated Transfer Redemption: The term "Shareholder-Initiated
Transfer Redemption" means a transaction that is initiated or directed by a
Shareholder that results in a transfer of assets within a Contract out of a
Fund, but does not include transactions that are executed: (i) automatically
pursuant to a contractual or systematic program or enrollments such as transfers
of assets within a Contract out of a Fund as a result of annuity payouts, loans,
systematic withdrawal programs, insurance company approved asset allocation
programs and automatic rebalancing programs; (ii) as a result of any deduction
of charges or fees under a Contract; (iii) within a Contract out of a Fund as a
result of scheduled withdrawals or surrenders from a Contract; or (iv) as a
result of payment of a death benefit from a Contract.
1.7-Shareholder Information: The term "Shareholder Information" shall have the
meaning set forth in Section 2.1(i), 2.1(ii), and 2.1(iii) below.
1.8-Written or In Writing: The term "written", "in writing" or similar term
includes electronic writings and facsimile transmissions unless otherwise
specified.
II. INFORMATION SHARING
2.1 Information Sharing - Intermediary agrees to provide the Fund, upon written
request, the following Shareholder Information:
(i) the taxpayer identification number ("TIN");
(ii) the Contract owner number or participant account number associated with the
Shareholder;
(iii) the amount, date and transaction type of every purchase, redemption,
transfer, or exchange of Shares held through an account maintained by the
Intermediary during the period covered by the request.
2.2 Period Covered by Request - Requests must set forth a specific period, not
to exceed 90 days from the date of the request, for which Shareholder
Information is sought. The Fund may request Shareholder Information older than
90 days from the date of the request as it deems necessary to investigate
compliance with policies established by the Fund for the purpose of eliminating
or reducing any dilution of the value of the outstanding shares issued by the
Fund.
2.3 Timing of Requests- Fund requests for Shareholder Information shall be made
no more frequently than quarterly except as the Fund deems necessary to
investigate compliance with policies established by the Fund for the purpose of
eliminating or reducing any dilution of the value of the outstanding shares
issued by the Fund.
2.4 Form and Timing of Response-
(a) Intermediary agrees to provide Shareholder Information to the Fund promptly
upon request If the Fund requests, the Intermediary agrees to use its best
efforts to promptly determine whether any specific person about whom it has
received Shareholder Information is itself a financial intermediary
("indirect intermediary").
(b) The Intermediary further agrees that if the Fund requests, the Intermediary
will, with notice to the Fund, promptly either: (i) provide (or arrange to
have provided) Shareholder Information for those shareholders who hold an
account with an indirect intermediary; or
(ii) prohibit the indirect intermediary from purchasing, in nominee name on
behalf of other persons, securities issued by the Fund.
(b) Responses required by this paragraph must be communicated in writing and in
a format mutually agreed upon by the Fund or its designee and the
Intermediary; and according to the IRS' website, the ITIN refers to the
Individual Taxpayer Identification number, which is a nine-digit number
that always begins with the number 9 and has a 7 or 8 in the fourth digit,
example 9XX-7X-XXXX. The IRS issues ITINs to individuals who are required
to have a placecountry-regionU.S. taxpayer identification number but who do
not have, and are not eligible to obtain a Social Security Number (SSN)
from the Social Security Administration (SSA). SEC Rule 22c-2 inadvertently
refers to the ITIN as the International Taxpayer Identification Number.
(c) To the extent practicable, the format for any Shareholder Information
provided to the Fund should be consistent with the NSCC Standardized Data
Reporting Format.
2.5 Limitations on Use of Shareholder Information- The Fund agrees to only use
the Shareholder Information for the purposes of identifying Shareholders who may
be violating the Funds policies and procedures with respect to dilution of the
Fund's value as contemplated by the Rule or to fulfill other regulatory or legal
requirements subject to the privacy provisions of Title V of the Xxxxx-Xxxxx
Bliely Act (Public Law 106-102) and comparable state laws. The Fund agrees that
the Shareholder Information is confidential and that the Fund will not share the
Shareholder Information externally, unless the Intermediary provides the Fund
with prior written consent to share such Shareholder Information. The Fund
agrees not to share the Shareholder Information internally, except on a "need to
know basis." The Fund further agrees to notify the Intermediary in the event
that the confidentiality of the Shareholder Information is breached.
III. PROHIBITIONS ON TRADING
3.1 Agreement to Prohibit Trading. Intermediary agrees to execute written
instructions from the Fund to prohibit further purchases or exchanges of Shares
by a Shareholder that has been identified by the Fund as having engaged in
transactions of the Fund's Shares (directly or indirectly through the
Intermediary's account) that violate policies established by the Fund for the
purpose of eliminating or reducing any dilution of the value of the outstanding
Shares issued by the Fund. Unless otherwise directed by the Fund, any such
prohibitions shall only apply to Shareholder-Initiated Transfer Purchases or
Shareholder-Initiated Transfer Redemptions that are effected directly or
indirectly through Intermediary. Instructions must be received by us at the
following address, or such other address that Intermediary may communicate to
you in writing from time to time, including, if applicable, an e-mail and/or
facsimile telephone number:
Phoenix Life Insurance Company
Attention: Xxxxxxx Xxxxxxxx
00 Xxxx Xxxxxx
Xxxx Xxxxxxxxx, Xxx Xxxx 00000
3.2 Form of Instructions. Instructions must include the TIN, ITIN, or GII and
the specific individual Contract owner number or participant account number
associated with the Shareholder, if known, and the specific instruction(s) to be
executed, including how long the prohibition(s) is(are) to remain in place. If
the TIN, ITIN, GII or the specific individual Contract owner number or
participant account number associated with the Shareholder is not known, the
instructions must include an equivalent identifying number of the Shareholder(s)
or account(s) or other agreed upon information to which the instruction relates.
Upon request of the Intermediary, Fund agrees to provide to the Intermediary,
along with any written instructions to prohibit further purchases or exchanges
of Shares by Shareholder, information regarding those trades of the contract
holder that violated the Fund's policies relating to eliminating or reducing any
dilution of the value of the Fund's outstanding Shares.
3.3 Timing of Response. Intermediary agrees to execute instructions as soon as
reasonably practicable, but not later than five business days after receipt of
the instructions by the Intermediary.
3.4 Confirmation by Intermediary. Intermediary must provide written confirmation
to the Fund that instructions have been executed. Intermediary agrees to provide
confirmation as soon as reasonably practicable, but not later than ten business
days after the instructions have been executed.
3.5 Redemption Fees. If the Fund implements a redemption fee in the future that
the Intermediary cannot implement within the requested timeframe despite the
Intermediary's best efforts, the Fund agrees to negotiate, in good faith, an
interim solution until such time that the redemption fee can be successfully
administered.
IV. GENERAL PROVISIONS
4.1 Construction of the Agreement; Fund Participation Agreements. The Fund and
Intermediary have entered into one or more Fund Participation Agreements between
or among them for the purchase and redemption of shares of the Funds by the
Accounts in connection with the Contracts. The Fund Participation Agreements are
hereby incorporated by reference into this Agreement, as this Agreement is
intended to be a supplement to the Fund Participation Agreements. To the extent
the terms of this Agreement conflict with the terms of a Fund Participation
Agreement, the terms of this Agreement shall control.
4.2 Indemnification. The Fund agrees to indemnify and hold harmless Intermediary
from any and all liability, claim, loss, demand, damages, costs and expenses
(including reasonable attorney's fees) arising in connection with third party
claim or action brought against Intermediary as a result of any unauthorized
disclosure of a shareholder's taxpayer identification number provided to the
Fund in response to a request for Shareholder Information pursuant to the terms
of this Agreement, provided, however that in no event shall the Fund or Fund's
Designee be liable to Intermediary for lost profits, exemplary, punitive,
special, incidental, indirect or consequential damages.
4.2 Force Majeure. Provided that each party has implemented and maintains a
business continuity plan that is reasonable designed to enable it to meet its
existing obligations to customers and address its existing relationships with
other broker-dealers and counterparties, such party is excused from performance
and shall not be liable for any delay in performance or non-performance, in
whole or in part, caused by the occurrence of any event or contingency beyond
the control of the parties including, but not limited to, work stoppages, fires,
civil disobedience, riots, rebellions, natural disasters, acts of God, and acts
of war or terrorism. The party who has been so affected shall promptly give
written notice to the other Party and shall use its best efforts to resume
performance. Upon receipt of such notice, all obligations under this Agreement
shall be immediately suspended for the duration of such Force Majeure Event.
4.3 Termination. This Agreement will terminate upon the termination of the
applicable Fund Participation Agreements.
IN WITNESS WHEREOF, the below persons, as duly authorized officers, have caused
this Agreement to be executed on behalf of the parties as of the Effective Date.
MFS Fund Distributors, Inc.
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
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Title: President
Date: 4/12/07
Phoenix Life Insurance Company, as Agent for Valley Forge Life Insurance Company
By: /s/ Xxxx Xxxxxxx X'Xxxxxxx
Name: Xxxx Xxxxxxx X'Xxxxxxx
Title: Senior Vice President
Date: 4/11/07
