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Revised 4//16/2020

Affected Investor Fund Qualified Settlement Fund Statement to Affected Investors

In Variable Products

INTRODUCTION

This Statement to Affected Investors (“Statement”) provides information to help you and your tax advisor determine the U.S. federal, state, local, non-US or other tax consequences of the distribution payment if you are a citizen or resident of the U.S. for U.S. federal income tax purposes.

This Statement is intended to provide you with information related to the payment described below. It includes an Introduction, Components of the Payment, Discussion of tax issues you may wish to consider and discuss with your tax advisor, Special issues associated with COVID-19 challenges with resource links, and finally a Discussion with instructions of the most common payee scenarios.

You are entitled to receive a payment from the Affected Investor Fund Qualified Settlement Fund (“Affected Investor QSF” of “QSF”), resulting from the United States Securities and Exchange Commission Administrative Proceeding File No. 3-18681 In the Matter of Aegon USA Investment Management, LLC, Transamerica Asset Management, Inc., Transamerica Capital, Inc., and Transamerica Financial Advisors, Inc. (“Respondents”), related to the offer, sale and management by Respondents of certain mutual funds, variable life insurance Investment portfolios, and variable annuity Investment portfolios (collectively, the “Products”) and separately managed accounts (“SMA”) strategies (the “Strategies”) which used quantitative models. In this Statement we refer to Products, and SMA Strategies as “Investments” collectively.

Payments to Affected Investors have been calculated based on information

contained in the records of Respondents and third-party intermediaries. As described in the SEC’s Order Instituting Proceedings (“Order”), the payments represent pro rata fees and commissions paid by an Affected Investor (as defined in the Order) during the period between July 2011 and June 2015 (the “Relevant Period”). The payments are being made pursuant to a disbursement calculation that was submitted to, reviewed by and approved by the staff of the Securities and Exchange Commission.

On August 27, 2018, the SEC issued the Order instituting and

simultaneously settling administrative and cease-and-desist proceedings against Respondents. Pursuant to the Order, Respondents agreed to pay disgorgement of $53,299,896, civil monetary penalties of $36,300,000, and prejudgment interest of $8,002,144. These amounts, totaling $97,602,040, as well as any penalties paid by Bradley J. Beman and Kevin A. Giles in the parallel proceedings, In the Matter

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of Bradley J. Beman, Administrative Proceeding File No. 3-18682 and In the Matter of Kevin A. Giles, Administrative Proceeding File No. 3-18683, are available for distribution. The SEC ordered Respondents Beman and Giles to pay a $65,000 and $25,000 civil money penalty into the Fair Fund in their respective related proceedings.

The Order required Respondents to administer a distribution to account holders who purchased or held an interest in any of the Products and Strategies during the Relevant Period (each, an “Affected Investor”).

The Affected Investor QSF is a Qualified Settlement Fund (“QSF”) under

the Internal Revenue Code. The Respondents retained Miller Kaplan Arase (“MKA”) to serve as the Tax Administrator for the QSF.

MKA and the Respondents have participated in the preparation of

this Statement but are not providing tax services or tax advice to you or any other Affected Investor receiving a distribution payment.

Some Affected Investors may be subject to special tax rules, such as, without limitation, non-U.S. investors, investors who hold or held shares in a tax- qualified retirement plan (“QRP”) or an individual retirement account (“IRA”), or investors that are tax-qualified retirement plans.

To help you with the process of handling your distribution check,

this Statement includes separate tabs that provide examples of typical payment scenarios together with sample checks and steps you may take with respect to the check you received.

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COMPONENTS OF THE DISTRIBUTION PAYMENT

CAUTION: YOU SHOULD NOT RELY ON THIS STATEMENT AS TAX ADVICE RELATED TO YOUR PERSONAL CIRCUMSTANCES.

CONSULT WITH YOUR TAX ADVISOR WITH RESPECT TO THE TAX

CONSEQUENCES OF THE DISTRIBUTION PAYMENT, INCLUDING THE EFFECTS OF U.S. FEDERAL, STATE, LOCAL AND NON-U.S. TAX RULES

AND THE EFFECT OF POSSIBLE CHANGES IN LAWS.

The Order provides, in part, that “Respondents shall pay from the Fair Fund to each Affected Investor an amount representing the pro-rata fees and commissions paid by the Affected Investor during the Relevant Period pursuant to a disbursement calculation (the “Calculation”) that will be submitted to, reviewed, and approved by the Commission staff. No portion of the Fair Fund shall be paid to any Affected Investor account in which any Respondents or any of their current or former officers or directors have a financial interest.”

Each distribution payment is composed of a “fee” component and an

“interest” component. Each of these components will be separately stated on the stub accompanying the check or other advice provided for an electronic payment.

This statement contains a discussion of 4 separate issues. We discuss a

fee and interest component; and then provide information on issues to consider if you held your Investment through an IRA or a tax-qualified plan.

This Statement provides you with information related to the payment that

will be mailed to you.

A. Fee Component

The fee component represents your share of fees and commissions you paid for the Products and Strategies that you held during the Relevant Period. The fee component may constitute ordinary income to you depending on several factors, including whether the Product or Strategy made a dividend payment taxable as ordinary income in a year during the Relevant Period for which fees are being returned. The Affected Investor QSF will not issue a Form 1099 or other tax reporting form to you for the fee component of the payment. This is not dispositive of the tax consequences to you which may be impacted by whether (i) you continue to hold an Investment in one of the Products or Strategies, (ii) you received a dividend payment taxable as ordinary income from a Product or Strategy during the Relevant Period; and/or (iii) you no longer hold an Investment in one of the Products or Strategies. You may wish to consult your tax advisor regarding the fee component.

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B. Interest Component

The interest component constitutes taxable interest income to you; however, you will only receive a Form 1099-INT if your distribution contains $600 or more of such interest. If you are, or are presumed to be, a non-resident alien of the U.S., or a payee subject to withholding under the Foreign Account Tax Compliance Act, you may receive a form 1042-S. You will not receive a 1099-INT if your Investment was held in an IRA, a Qualified Plan or a variable product. You may wish to consult your tax advisor for more information.

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TAX ISSUES YOU MAY WISH TO DISCUSS WITH YOUR TAX ADVISOR

A. IRAs

Caution: Consult with your tax advisor because the rules related to IRA transfers and rollovers are complicated and technical. Failure to comply with those rules could subject the payment to income tax and a 10% additional tax. It could also impact your ability to rollover other IRA funds.

Some Affected Investors may have held their investment in an IRA or in a

variable annuity (“VA”) purchased through an IRA. However, the Affected Investor Fund QSF does not have enough information in all instances to determine if Affected Investors held their Investment in an IRA, or in VAs purchased through an IRA. Consequently, you should check your records to determine if you purchased your Investment through an IRA or if you purchased your VA through an IRA.

If you determine that you held your Investment in an IRA, or held your

VA through an IRA, please contact the QSF Administrator, SS&C Asset Manager Solutions, Inc., by using the toll-free number on the statement accompanying your payment, before cashing or otherwise negotiating a check that has been mailed to you. Your check should be deposited into your IRA account. The QSF Administrator can assist you with this process and, if necessary, reissue your check so that the trustee or custodian of your IRA can accept it.

Where you held your Investment in an IRA, or in a VA through an IRA and the distribution check was made payable to you (as opposed to the custodian of your IRA), please contact the QSF Administrator to receive instructions to get a replacement distribution check made payable to the custodian of your IRA.

If your IRA custodian has changed, you may be able to transfer the payment to the new custodian or roll the payment over to another IRA or affected account.

If you no longer hold your IRA or you need a check payable to a new payee, please contact the QSF Administrator to review your options.

If you held your Investment in an IRA, or in a VA through an IRA, and you cashed your check or deposited it into an account other your IRA, it is considered a distribution from your IRA. You may be able to rollover such distribution into your

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IRA within 60 days of receipt of your check. You are only permitted one IRA rollover in any 12-month period regardless of the number of IRAs you own. Consequently, this option may not be available to you if you have performed a rollover within the previous 12 months. If you are eligible to – and do – rollover this distribution, you will not be able to perform another rollover within 12 months for any IRA you own.

Additional information is available in IRS Publication 590-B and IRS Tax

Topic 451, which may be found at the IRS’ website: www.irs.gov.

Note: Please consult your tax advisor if you held your Investment in an IRA, or in a VA purchased through an IRA.

B. Qualified Plans

Caution: Consult with your tax advisor because the rules related to Qualified Plan transfers and rollovers are complicated and technical.

Some Affected Investors may have held their Investment in a Qualified Plan

or in a variable annuity (“VA”) or variable life insurance (“VLI”) purchased through a Qualified Plan. However, the Affected Investor Fund QSF does not have enough information in all instances to determine if Affected Investors held their Investment in a Qualified Plan or in VAs or VLIs through a Qualified Plan. Consequently, you should check your records to determine if you purchased such Investments through a Qualified Plan or if you purchased such VA or VLI through a Qualified Plan.

If you determine that you held your Investment, VA, or VLI through a

Qualified Plan, please contact the QSF Administrator, SS&C Asset Manager Solutions, Inc., by using the toll-free number on the statement accompanying your payment, before cashing or otherwise negotiating a check that has been mailed to you. Your check should be deposited into your Qualified Plan account. The QSF Administrator can assist you with this process and, if necessary, reissue your check so that the trustee or custodian of your Qualified Plan can accept it. Plan fiduciaries are responsible for allocating these funds. Please contact your plan fiduciary if you have questions.

Where you held your Investment, VA, or VLI in a Qualified Plan and the

distribution check was made payable to you (as opposed to the trustee/administrator of your Qualified Plan), please contact the QSF Administrator to receive instructions to get a replacement distribution check made payable to the trustee or administrator of your Qualified Plan.

Where you held your Investment, VA, or VLI in a Qualified Plan and the

distribution check was made payable to the trustee/administrator of your Qualified

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Plan contact the trustee/administrator of your plan to coordinate the deposit of the check into your retirement plan account. If you are no longer a participant in the Qualified Plan, please contact the trustee/administrator of your former Qualified Plan to determine the appropriate course of action. If you have difficulty contacting your former Qualified Plan trustee/administrator, please contact the QSF Administrator for assistance.

Additional information on this topic is available on the IRS Web Site

www.irs.gov, Tax Topic 558. Note: Please consult your tax advisor if you held your Investment in a Qualified Plan, or in a VA or VLI purchased through a Qualified Plan.

C. Variable Annuity or Variable Life Insurance Products

IMPORTANT NOTE: THE INFORMATION PROVIDED BELOW IS INTENDED FOR AFFCTED INVESTORS WHO HELD INVESTMENTS IN A VARIABLE ANNUITY (“VA”) OR VARIABLE LIFE INSURANCE PRODUCT (“VLI”)

Whether amounts received as a return of fees paid are included in gross

income depends on when they are received and whether they are allocable to income on the contract or Investment in the contract.

Whether an amount not received as an annuity payment with respect to a

variable annuity contract or a variable life insurance contract is considered allocable to the accumulated income on the contract and thus includible in gross income is dependent on many facts beyond the knowledge of the QSF. The tax rules are complex, so you may wish to consult your tax advisor and reference IRC section 72(e).

The Affected Investor QSF will not issue a Form 1099 or other tax reporting

form to you for the fee component of the payment. The fact that the QSF has not issued a Form 1099 or other tax reporting form to you, does not mean that there are no tax consequences to this distribution payment in your hands. You may wish to reference the IRC, including IRC section 72(e), and consult your tax advisor.

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SPECIAL ISSUES ASSOCIATED WITH COVID-19 CHALLENGES AND RESOURCES ON THE AFFECTED INVESTOR WEBSITE

With the challenges faced by investors, advisors, brokers, Custodians and

Administrators related to the COIVD-19 crisis, this Statement provides you with additional resources.

Some custodians may not be open or able to offer you a branch in which

you can deposit the check. This Statement provides you with the information you need to contact the Administrator at 855-979-1857 and explain your circumstances. You will then be provided with options that will help you preserve the tax character of your payment. In addition, the following resources may assist you:

The following forms and instructions are available to you on the Affected Investor Fund Website at www.affectedinvestorfund.com

Reissue Forms

Reissue IRA to Individual Distribution Form: Reissue IRA or Variable Annuity to Individual

Distribution Form.pdf

For use by individuals who received a check written to their IRA and no longer maintain an IRA.

Reissue IRA to Beneficiary Distribution Form: Reissue IRA to Beneficiary Distribution

Form.pdf

For use by beneficiaries or guardians who received a check written to an individual’s IRA and it

should be reissued to the beneficiary or guardian.

Reissue Non-IRA Distribution Form: Reissue Non-IRA Distribution Form.pdf

For use by beneficiaries or guardians who received a check written to an individual as part of a

Retirement or a Defined Benefit Plan and it should be reissued to the beneficiary or guardian.

Reissue Beneficiary Non-IRA Distribution Form: Reissue Beneficiary Non-IRA Distribution

Form.pdf

For use by individuals who received a check as part of a Retirement Plan or a Defined Benefit

Plan and the Plan or employer no longer exists.

Abandoned Plan Affidavit Form: Abandoned Plan Affidavit Form.pdf

For use by individuals who received a check as part of a Retirement Plan or a Defined Benefit

Plan and the Plan or employer no longer exists.

Final Form 5500

If your plan is no longer active or has been abandoned, you may find the final form 5500 for

your former Tax-Qualified Retirement Plan on www.freeerisa.com.

NOTE: You should consult with your tax advisor to determine any federal, state, local,

non-US or other tax issues you may need to address regarding the distribution.

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COMMON PAYEE SCENARIOS AND INSTRUCTIONS

The entry on the payee line of your check may have been filled out based on many different scenarios applicable to the payments made from this QSF. The typical scenarios are addressed on the following pages.

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CHECK MADE PAYABLE TO YOU AS AN INDIVIDUAL The image below shows an example of a check made payable to you as an individual.

If you received a check made payable directly to you, then you may cash the check. There may tax consequences to this option. Please talk to your tax professional. If you purchased your Investment through a retirement account and if your IRA, qualified plan, nonqualified annuity or other variable product is still active, you may return the funds back to your investment by endorsing the check “for return to [your account number]”, signing the check and mailing it with a completed Letter of Instruction available on this website or a letter containing the information in the Letter of Instruction. If the contract has annuitized (i.e. is in payout mode) your only option is to cash the check. There may tax consequences to you. Please talk to your tax professional. Caution: Consult with your tax advisor because the rules related to variable products are complicated and technical. Failure to comply with those rules could subject the payment to income tax and a 10% additional tax.

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CHECK MADE PAYABLE TO A CUSTODIAN The image below shows an example of a check made payable to a custodian of an IRA.

A check made payable to a custodian of an IRA which typically will say “[Name of Custodian] Jane Doe IRA” or “[Name of Custodian] for the benefit of Jane Doe IRA.” The word “IRA” will typically appear on the payee line. You may contact your Custodian or return this check into your IRA by endorsing the check “for return to [your account number], signing the check and mailing it with a completed Letter of Instruction available on this website or a letter including the information in the Letter of Instruction. If the contract has annuitized (i.e. is in payout mode) your only option will be to request that SS&C reissue the check to be made payable to you. You can request that SS&C reissue the check using the Letter of Instruction template found on the website. You can then cash the reissued check. There may tax consequences to you. Please talk to your tax professional. There are a number of additional options available to you if you wish to have your check re-issued. These options are addressed on this website and relevant information and links also appear in the “Special Issues Associated with COVID-19 Challenges and Resources on the Affected Investor Website” page. Caution: Consult with your tax advisor because the rules related to IRA transfers and rollovers are complicated and technical. Failure to comply with those rules could subject the payment to income tax and a 10% additional tax. It could also impact your ability to rollover other IRA funds.

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CHECK MADE PAYABLE DIRECTLY TO YOUR IRA The image below shows an example of a check made payable to an IRA bearing your name but not the name of your custodian.

You may return this check into your IRA by endorsing the check “return to [your account number]”, signing the check and mailing it with a completed Letter of Instruction available on this website or a letter containing the information in the Letter of Instruction. If your contract has annuitized (i.e. is in payout mode) your only option will be to cash the check. If your financial institution will not accept the check as written, you can request that SS&C reissue the check to be made payable to you. You can request that SS&C reissue the check using the Letter of Instruction template found on the website. There may tax consequences to your cashing the check. Please talk to your tax professional. There are a number of additional options available to you if you wish to have your check re-issued. These options are addressed on this website and relevant information and links also appear in the “Special Issues Associated with COVID-19 Challenges and Resources on the Affected Investor Website” page. Caution: Consult with your tax advisor because the rules related to IRAs are complicated and technical. Failure to comply with those rules could subject the payment to income tax and a 10% additional tax. It could also impact your ability to rollover other IRA funds.

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CHECK MADE PAYABLE TO A NON-QUALIFIED ANNUITY OR USING THE REFERENCE “NQ”

The image below shows an example of a check made payable to a Non-Qualified annuity.

If the contract has annuitized (i.e. is in payout mode) your only option is to cash the check. There may be tax consequences to you. Please talk to your tax professional A check made payable to a non-qualified annuity will typically contain either the phrase “Non-Qualified” or the abbreviation “NQ.” You may return this check into your nonqualified annuity by endorsing the check “for return to [your account number]”, signing the check and mailing it with a completed Letter of Instruction available on this website or a letter containing the information in the Letter of Instruction. There are a number of additional options available to you if you wish to have your check re-issued, including making the check payable to you personally using the Letter of Instruction template found on the website. These options are addressed on this website and relevant information and links also appear in the “Special Issues Associated with COVID-19 Challenges and Resources on the Affected Investor Website” page. Caution: Consult with your tax advisor because the rules related to nonqualified variable products are complicated and technical. Cashing a check made payable to you could subject the payment to income tax and a 10% additional tax for early withdrawal.

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CHECK MADE PAYABLE TO A QUALIFIED PLAN The image below shows an example of a check made payable to a qualified plan.

A check made payable to a qualified plan will typically contain phrases such as “qualified plan,” “pension,” or “retirement.” You may contact your Plan Administrator to arrange for the deposit of this check into your Qualified Retirement Plan or discuss other options. If the annuity in your qualified plan has annuitized (i.e. is in payout mode) your plan Administrator will provide you with documents you will need to contact SS&C to request reissuance of the check to be made payable to you. Contact your tax professional to discuss any tax consequences. You should contact the Administrator if your Qualified Retirement Plan is no longer in existence. Caution: Consult with your tax advisor because the rules related to qualified plans are complicated and technical and may have adverse tax consequences.