RULE 22C-2 AGREEMENT
THIS AGREEMENT (the "Agreement") by and between Ariel Distributors, LLC
("Ariel") and Security Distributors, Inc. (the "Firm") is effective as of
3-20-07.
WITNESSETH
WHEREAS, Ariel and the Firm have previously entered into a Participation
Agreement;
WHEREAS, Ariel serves as the distributor for several series of Ariel
Investment Trust (the "Trust"), a registered investment company (each a "Fund"
and collectively the "Funds");
WHEREAS, the Firm provides various shareholder and administrative services
to the Funds, including the receipt and transmission of orders for the purchase,
exchange and redemption of shares of the Funds ("Shares");
WHEREAS, certain policies, procedures and information are necessary to
enable the Firm to have accounts purchase and sell Shares for the benefit of the
participants in accounts (the "Investors"); and
WHEREAS, in accordance with the requirements of new Rule 22c-2 under the
Investment Company Act of 1940 (the "1940 Act"), the parties wish to enter into
this Agreement to address the monitoring of frequent trading;
NOW THEREFORE, in consideration of the promises and mutual covenants
hereinafter contained, the parties hereby agree as follows:
1. The Firm agrees to provide Ariel and the Trust, upon written
request, the Taxpayer Identification Number ("TIN"), the
Individual/International Taxpayer Identification Number ("ITIN"), or other
government-issued identifier ("GII"), if known, of any or all Investors, the
name or other identifier of any investment professional(s) associated with the
Investors (if known), and the amount, date and transaction type (purchase,
redemption, transfer, or exchange) of every purchase, redemption, transfer, or
exchange of Fund Shares held through Firm accounts maintained by the Firm during
the period covered by the request. Requests must set forth a specific period,
not to exceed 90 days, for which transaction information is sought. Ariel and/or
the Trust may request transaction information older than 90 days as either deems
necessary to investigate compliance with policies established by the Trust for
the purpose of eliminating or reducing any dilution of the value of Fund Shares.
2. The Firm agrees to transmit the requested information that is on its
books and records to Ariel and the Trust promptly, but in any event no later
than ten (10) business days, after receipt of a request. If requested by Ariel
or the Trust, the Firm agrees to use best efforts to determine promptly whether
any specific person about whom it has received the identification and
transaction information specified in Section 1 is itself a financial
intermediary ("indirect intermediary") and, upon further request of Ariel or the
Trust, the Firm agrees promptly, but in any event no later than ten (10)
business days, after receipt of a request to: (1) provide or arrange to provide
to Ariel and the Trust the requested information from Investors who hold an
account with an indirect intermediary; or (2) if directed by Ariel or the Trust,
block further purchases of Fund Shares from such indirect intermediary. In such
instance, the Firm agrees to inform Ariel and the Trust whether it plans to
perform (1) or (2). Responses required by this paragraph must be communicated in
writing and in a format mutually agreed upon by the
parties To the extent practicable, the format for any transaction information
provided to Ariel and the Trust should be consistent with the NSCC Standardized
Data Reporting Format. For purposes of this paragraph, an "indirect
intermediary" has the same meaning as in Rule 22c-2 under the 1940 Act. Ariel
and the Trust agree not to use the information received for marketing or any
other similar purpose without the prior written authorization of the Firm.
3. The Firm agrees to execute written instructions from Ariel and the
Trust to restrict or prohibit further purchases or exchanges of Fund Shares by
any Investor that has been identified by Ariel or the Trust as having engaged in
transactions of Fund Shares (directly or indirectly through the Firm) that
violate policies established by the Trust for the purpose of eliminating or
reducing any dilution of the value of Fund Shares. Instructions must include the
TIN, IBIN or GIN, if known, and the specific restriction(s) to be executed. If
the TIN, ITIN or GIN is not known, the instructions must include an equivalent
identifying number of the Investor(s) or Firm account(s) or other agreed upon
information to which the instruction relates The Firm agrees to execute
instructions as soon as reasonably practicable, but not later than five (5)
business days after receipt of the instructions by Ariel. The Firm must provide
written confirmation to Ariel and the Trust that instructions have been
executed. The Firm agrees to provide confirmation as soon as reasonably
practicable, but not later than ten (10) business days after the instructions
have been executed.
4. This Agreement may be executed in one or more counterparts which,
taken together, shall constitute one and the same document.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the dates set forth below.
ARIEL DISTRIBUTORS, LLC SECURITY DISTRIBUTORS, INC.
/s/ Xxxxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
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SIGNATURE SIGNATURE
Xxxxxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx
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PRINTED NAME PRINTED NAME
President President
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TITLE TITLE
3-20-07 3/23/07
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DATE DATE
Page 2
March 9, 2007
Mr. David Soph
Security Benefit Group
One Security Benefit Place
Topeka, KS 66636-0001
RE: COMPLIANCE WITH RULE 22C-2
Dear Mr. Soph:
As a valued partner, we are contacting you in connection with the SEC's
redemption fee regulation, Rule 22c-2, under the Investment Company Act of 1940
(the "Rule") As you may know, this Rule requires us to enter into an agreement
with each of our financial intermediaries to provide access to shareholder
identification and transaction information upon request.
PLEASE SELECT ONE OR MORE OF THE BOXES BELOW to indicate how your firm trades
and RETURN A SIGNED COPY OF THIS LETTER TO ME.
[ ] Our firm DOES NOT TRADE VIA ANY OMNIBUS ACCOUNTS; all individual
accounts are fully disclosed on NSCC Network Level 3 or held directly at
BFDS, Ariel Mutual Funds' transfer agent.
[X] Our firm DOES TRADE VIA OMNIBUS ACCOUNT(S).
[ ] We trade through NSCC clearing or trading platform. Please contact Xxxxx
Xxxxxxxxxx at 000-000-0000 phone number for further information as to how
the accounts are disclosed or held at BFDS, Ariel Mutual Funds' transfer
agent.
Also enclosed is an Amendment to the Selling/Services and/or Sub-Transfer Agency
Agreement between your firm and Ariel Distributors, LLC. Please sign two copies
and return one copy to us by January 31, 2007. IF THE AMENDMENT IS NOT EXECUTED
BY APRIL 16, 2007 (THE CURRENT SEC DEADLINE), ARIEL MUTUAL FUNDS WILL NO LONGER
BE ABLE TO ACCEPT PURCHASES ON BEHALF OF YOUR CLIENTS.
Should you have any questions about the enclosed Amendment, or other issues
relating to our implementation of Rule 22c-2, please contact Xxxxx Xxxxxxxxx,
Chief Compliance Officer of Ariel Mutual Funds, at 312-726-0140
Sincerely,
/s/ Xxxxxxxxx X. Xxxxxx
Xxxxxxxxx X. Xxxxxx
President
Ariel Distributors, LLC
********************************************
PLEASE COMPLETE THE SECTION BELOW AND RETURN WITH THE COUNTER-SIGNED AMENDMENT
TO XXXXXXXXX X. XXXXXX, XXXXX DISTRIBUTORS, LLC, 000 XXXX XXXXXXXX XXXXX, XXXXX
0000, XXXXXXX, XX 00000.
Xxxxxxx X. Xxxxxx 3/23/07
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PRINT NAME OF OFFICER DATE
/s/ Xxxxxxx X. Xxxxxx President
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SIGNATURE OF OFFICER TITLE
Security Distributors, Inc. 000-000-0000
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FIRM NAME PHONE
One Security Benefit Place
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STREET ADDRESS
Xxxxxx XX 00000-0000
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CITY STATE ZIP CODE
IN ORDER TO UPDATE OUR CONTACT RECORDS, PLEASE COMPLETE THE PRIMARY RELATIONSHIP
CONTACT INFORMATION BELOW:
Xxxxx Soph Business Development Analyst
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PRIMARY CONTACT TITLE
xxxxx.xxxx@xxxxxxxxxxxxxxx.xxx 000-000-0000
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EMAIL ADDRESS PHONE
One Security Benefit Place
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STREET ADDRESS
Xxxxxx XX 00000-0000
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CITY STATE ZIP CODE
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