Supplemental Agreement
This Supplemental Agreement is entered into as of March 1, , 2008 by and
between MBSC Securities Corporation ("MBSC") on its behalf, and/or on behalf of
one or more of the Funds for which it serves as principal underwriter, and the
undersigned (the "Intermediary").
WHEREAS, MBSC and the Intermediary have previously entered into one or more of
the agreements (the "Agreement") set forth on Attachment A to this Supplemental
Agreement relating to certain funds ("Funds") for which MBSC is the principal
underwriter and distributor of Fund Shares (as defined below);
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
which consideration is full and complete, MBSC and the Intermediary hereby
agree as follows:
A. Definitions
1. "Fund" includes the Funds covered by the Agreement and the Funds'
principal underwriter and transfer agent. The term does not include any
"excepted funds" as defined in Rule 22c-2(b) under the Investment
Company Act of 1940 (the "1940 Act").
2. "Shareholder" shall mean, as applicable, (a) the beneficial owner of
Shares, whether the Shares are held directly by Shareholder or by the
Intermediary in nominee name; (b) a Plan participant notwithstanding
that the Plan may be deemed to be the beneficial owner of Shares; or
(c) the holder of interests in a Fund underlying a variable annuity or
variable life insurance contract.
3. "Written" communications include electronic communications and facsimile
transmissions.
B. Shareholder Information and Imposition of Trading Restrictions
1. Agreement to Provide Information. The Intermediary agrees to provide
promptly, but not later than 10 business days, to the Fund, upon Written
request, the taxpayer identification number ("TIN"), if known, of any or
all Shareholder(s) who have purchased, redeemed, transferred or
exchanged Shares held through an account with the Intermediary (an
"Account") during the period covered by the request and the amount,
date, name or other identifier of any investment professional(s)
associated with the Shareholder(s) or Account (if known), and
transaction type (purchase, redemption, transfer or exchange) of every
purchase, redemption, transfer or exchange of Shares ("Transaction
Information"). To the extent practicable, the format for any Transaction
Information provided to the Fund should be consistent with the NSCC
Standardized Data Reporting Format.
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(a)Period Covered by Request. Requests must set forth a specific period,
not to exceed 90 days from the date of the request, for which
Transaction Information is sought. The Fund may request transaction
data 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 dilution to the value
of the outstanding shares issued by the Fund.
(b)Timing of Requests- Fund requests for Transaction 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.
(C)The Intermediary agrees to use best efforts to determine, promptly
upon request of the Fund, but not later than 10 days, whether any
person that holds Shares through the Intermediary is an "indirect
intermediary "as defined in Rule 22c-2 under the 1940 Act (an
"Indirect Intermediary"), and upon further request of the Fund,
(i) provide or arrange to have provided the information set forth in
paragraph (B)(1) of this Supplemental Agreement regarding
Shareholders who hold an account with an Indirect Intermediary; or
(ii) restrict or prohibit the Indirect Intermediary from purchasing
Shares on behalf of itself or other persons.
(c)MBSC agrees not to use the information received under this Section B
for marketing or any other similar purpose without the prior Written
consent of the Intermediary.
2. Agreement to Prohibit Trading. The 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 Shares (directly or indirectly
through an Account) that violate the policies established by the Fund
for the purpose of eliminating or reducing any dilution of the value of
its Shares.
(a)Form of Instructions. Instructions provided to the Intermediary will
include the TIN, if known, and the specific prohibition(s) to be
executed. If the TIN is not known, the instructions will include an
equivalent identifying number of the Shareholder(s) or account(s) or
other agreed upon information to which the instructions relates.
(b)Confirmation by the Intermediary. The Intermediary must provide
Written confirmation to the Fund that instructions have been
executed. The Intermediary agrees to provide the confirmation as soon
as reasonably
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practicable, but not later than 10 business days after the
instructions have been executed.
(c)Redemption Fees. The Intermediary shall not purchase or redeem Fund
shares that are subject to redemption fees, including shares of
Portfolios or share classes that later become subject to redemption
fees, in the absence of an amendment to the Fund participation
agreement.
C. Late Trading Procedures. The Intermediary represents that it has adopted,
and will at all times during the term of the Agreement maintain, reasonable
and appropriate procedures designed to ensure that any and all orders to
purchase, redeem, transfer or exchange Shares received by the Intermediary
from Shareholders treated as received prior to the close of trading (the
"Close of Trading") on the New York Stock Exchange (the "NYSE") (usually
4:00 p.m. Eastern time) on a day the NYSE is open for business (a "Business
Day") are received by the Intermediary prior to the Close of Trading on such
Business Day and are not modified after the Close of Trading and that all
such orders received, but not rescinded, by the Close of Trading are
communicated to MBSC or its designee for that Business Day. Each
transmission of Share orders by the Intermediary shall constitute a
representation that such orders are accurate and complete and are as
received by the Intermediary by the Close of Trading on the Business Day for
which the orders are to be priced and that such transmission includes all
Share orders received from customers, but not rescinded, by the Close of
Trading.
D. Anti-Money Laundering Program Procedures. The Intermediary represents and
warrants that, to the extent required by applicable law, it has adopted
policies and procedures to comply with all applicable anti-money laundering,
customer identification, suspicious activity, currency transaction reporting
and similar laws and regulations including the Bank Secrecy Act, as amended
by the USA PATRIOT Act, and the regulations thereunder, and Financial
Industry Regulatory Authority ("FINRA") Rule 3011. The Intermediary also
represents and warrants that it will not purchase or sell Shares on behalf
of any person on the list of Specially Designated Nationals and Blocked
Persons maintained by the Office of Foreign Assets Control ("OFAC"), or
other similar governmental lists, or in contravention of any OFAC maintained
sanctions program. The Intermediary agrees to share information with the
Fund for purposes of ascertaining whether a suspicious activity report
("SAR") is warranted with respect to any suspicious transaction involving
Shares, provided that neither the Intermediary nor the Fund is the subject
of the SAR. The Intermediary, if required to maintain an anti-money
laundering program, also represents and warrants that it has filed the
requisite certification with the Financial Crimes Enforcement Network
("FinCEN") to allow the Intermediary to share information pursuant to
Section 314(b) of the USA PATRIOT Act.
E. ). Limitations on Use of Shareholder Information-
(i)Limitations. The Fund agrees to only use the Transaction 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
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regulatory or legal requirements subject to the privacy provisions of Title
V of the Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102) and comparable state
laws. The Fund agrees that the Transaction Information is confidential and
that the Fund will not share the Transaction Information externally, unless
the Intermediary provides the Fund with prior written consent to share such
Transaction Information.
(ii) Breach of Confidentiality. If MSBC becomes aware of any disclosure to
an unauthorized third party of any non-public personal financial information
of a consumer provided or received by MSBC in response to a request for
information pursuant to the terms of this Agreement, MSBC promptly shall, at
its expense: (i) notify the Chief Privacy Officer or comparable staff person
of the Intermediary; (ii) investigate the circumstances relating to such
actual or suspected unauthorized access, use or disclosure; (iii) take
commercially reasonable steps to mitigate the effects of such unauthorized
access, use or disclosure and to prevent any reoccurrence; (iv) provide to
the other such information regarding such unauthorized access, use or
disclosure as is reasonably required for the other party to evaluate the
likely consequences and any regulatory or legal requirements arising out of
such unauthorized access, use or disclosure; and (v) cooperate with the
other party to further comply with all relevant laws, rules and regulations.
(iii)Transmissions of Transaction Information. MSBC agrees that when
transmitting Transaction Information by facsimile or electronic writing that
the Transaction Information will be protected by encryption, password, or
some other form of secure transmission, which will adequately protect the
confidentiality of the Transaction Information.
F.
G. Qualification of Shares in States. MBSC agrees to make available to the
Intermediary a list of the states or other jurisdictions in which Shares are
registered for sale or are otherwise qualified for sale, which may be
revised from time to time. The Intermediary will make offers of Shares to
its customers only in those states, and will ensure that the Intermediary
(including its associated persons) are appropriately licensed and qualified
to offer and sell Shares in any state or other jurisdiction that requires
such licensing or qualification in connection with the Intermediary's
activities. MBSC will promptly inform the Intermediary of any changes to the
list of states.
H.
I. Miscellaneous
1. Construction of the Agreement; Fund Participation Agreements. The parties
have entered into one or more Fund Participation Agreements between or among
them for the purchase and redemption of shares of the Funds by the Accounts in
connection with the Contracts. The Fund Participation Agreements are hereby
incorporated by reference into this Agreement, as this Agreement is intended to
be a supplement to the Fund Participation
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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.
2. Scope of Agreement. The purpose of this Agreement is to share Transaction
Information with MBSC to allow the Fund to administer its own definition of
disruptive trading. The Intermediary's obligations under this Agreement are
limited to providing Transaction Information and executing prohibitions on
trading when instructed to do so.
3. Termination. This Agreement will terminate upon the termination of the
applicable Fund Participation Agreements, except to the extent that this
Agreement is applicable to "Existing Contracts" as defined by the Fund
Participation Agreement.
2. All notices and other communications provided for under the terms of the
Agreement shall be given in writing and delivered by personal delivery,
by postage prepaid mail, or by facsimile or email.
4This Supplemental Agreement shall be governed and construed in accordance
with the laws of the state of New York without regard to conflict of law
principals, and shall bind and inure to the benefit of the parties hereto
and their respective successor and assigns.
3. The Agreement, including any Exhibits, Attachments or Appendices
attached thereto, may be amended by MBSC upon 15 days' prior notice to
Intermediary, and such amendment shall be deemed accepted by
Intermediary upon the placement of any order for the purchase of Fund
Shares or the acceptance of any fee payable under the Agreement after
the effective date of any such amendment.
IN WITNESS WHEREOF, this Supplemental Agreement has been acknowledged and
executed as of the date set forth below:
MBSC Securities Corporation PHL Variable
Insurance Company
--------------------------------------- --------------------------------------
Signed Signed
Xxxxxx X. Xxxxxx Xxxx Xxxxxxx X'Xxxxxxx
Print Name Print Name
Executive Vice President Senior Vice President Vice
Title Title
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ATTACHMENT A
Marketing and Support Services Agreement
Supplemental Agreement Regarding Networking
Money Market Fund (Omnibus) Distribution and Shareholder Services Agreement
Money Market Fund (Fully-Disclosed)
Distribution and Shareholder Services Agreement
Fund (Omnibus) Distribution and Shareholder Services Agreement
Fund (Fully Disclosed) Distribution and Shareholder Services Agreement
Fund Participation Agreement
Services Agreement
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