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Questions and Answers about the spin-off of Virtus Investment Partners:

  1. What is the spin-off?
  2. What is Virtus Investment Partners?
  3. Why did Phoenix spin-off Virtus?
  4. When did I receive Virtus common stock?
  5. How many shares of Virtus common stock did Phoenix distribute to me?
  6. Will I receive a check from Virtus?
  7. What are the U.S. federal income tax consequences of the spin-off to PNX stockholders?
  8. What is the “fair market value” of Virtus common stock to determine tax obligations?
  9. What is the cost basis of my new shares of Virtus common stock?
  10. When will I receive a Form 1099 related to this transaction?
  11. Did my ownership in Phoenix change as a result of the spin-off?
  12. Will I receive a Virtus stock certificate?
  13. Do I need to do anything now?
  14. What if I want to sell my Virtus common stock?
  15. Who is the distribution agent, transfer agent and registrar for Virtus common stock?
  16. Where can Virtus shareholders get more information?

Q: What is the spin-off?

A: The spin-off is the overall transaction of separating Virtus Investment Partners, Inc. (NASDAQ: VRTS) from The Phoenix Companies, Inc. (NYSE: PNX). On December 12, 2008, the board of directors of The Phoenix Companies, Inc. (“Phoenix” or “PNX”) voted to spin-off Virtus as an independent company. The spin-off was accomplished through a series of transactions which resulted in a pro rata distribution of Virtus (“VRTS”) common stock by Phoenix on December 31, 2008 (the “distribution”) to holders of Phoenix common stock on the record date for the distribution, which was 5:00 p.m., New York City time on December 22, 2008.

Q: What is Virtus Investment Partners?

A: Virtus is an independent publicly traded asset management company providing investment management products and services to individuals and institutions. Virtus previously was a wholly owned subsidiary of Phoenix and known as Phoenix Investment Partners, Ltd. Following the spin-off from Phoenix, Virtus is listed on the NASDAQ Global Market under the symbol “VRTS.” Virtus’ assets and business consist largely of those that had been reported in Phoenix’s financial statements as Phoenix’s Asset Management segment, but excluding the assets and business of Phoenix’s wholly owned subsidiary, Goodwin Capital Advisers, Inc.

Q: Why did Phoenix spin-off Virtus?

A: Virtus and Phoenix are fundamentally different types of businesses, and the board of directors of Phoenix decided that separation of the two businesses will help highlight the unique characteristics and values of these businesses for investors, and better position each company to access the capital markets.

For a further explanation of the reasons for the spin-off and more information about Virtus’ business, see “The Spin-Off—Reasons for the Spin-Off” and “Business” in the Information Statement, dated December 23, 2008, that was sent to Phoenix shareholders as of the record date. The Information Statement is also available at the website of the Securities and Exchange Commission (www.sec.gov), as Exhibit 99.1 to the Form 10 filed by Virtus on December 19, 2008 and at www.phoenixwm.com and www.Virtus.com.

Q: When did I receive Virtus common stock?

A: Shareholders of Phoenix’s common stock as of 5:00 p.m., New York City time on December 22, 2008, which was the record date for the distribution, received shares of Virtus common stock in the distribution on December 31, 2008.

Q: How many share of Virtus common stock did Phoenix distribute to me?

A: As a shareholder of Phoenix common stock on the record date, you were entitled to receive one share of Virtus common stock for every 20 shares of Phoenix common stock that you held on the record date. Phoenix did not issue fractional shares of Virtus common stock to its shareholders as part of the spin-off, so Phoenix shareholders who would otherwise have been entitled to receive fractional shares as part of the spin-off can expect to receive a check for cash in lieu of Virtus common stock in late February. Your shares will be viewable online at Mellon Investor Services at that time.

Q: Will I receive a check from Virtus?

A: As noted above, Phoenix did not issue fractional shares of Virtus common stock to its shareholders as part of the spin-off. If your entitlement resulted in a fractional share, you will receive a check representing the cash-in-lieu payment in late February.

Q: What are the U.S. federal income tax consequences of the spin-off to PNX stockholders?

A: The spin-off is a taxable transaction for U.S. federal income tax purposes for the 2009 tax year. U.S. shareholders must include the fair market value of the Virtus shares received (including fractional shares for which shareholders receive cash) as dividend income in 2009. For individuals, subject to certain limitations, such dividend income will be taxable at a reduced rate of 15%. A non-U.S. shareholder is generally subject to withholding or applicable tax treaty rate, unless the shareholder can establish that it is entitled to a reduction or exemption from such tax.

Backup withholding taxes will apply if a shareholder has not provided the necessary certification or is not otherwise eligible for an exemption. The agent will sell shares otherwise allocable to certain shareholders to pay any backup withholding or other withholding taxes.

This summary does not discuss all tax considerations that may be relevant to stockholders in light of your particular circumstances, nor does it address any state, local or foreign tax consequences. You should consult your own tax advisor as to the particular consequences of the spin-off to you.

For a more comprehensive discussion of the tax consequences of the spin-off, you are encouraged to read the section, “The Spin-off—Material U.S. Federal Income Tax Consequences of the Spin-off,” in the Form 10 Information Statement, dated December 23, 2008, that was sent to Phoenix shareholders as of the record date.  That Information Statement is also available at the website of the Securities and Exchange Commission (www.sec.gov), as Exhibit 99.1 to the Form 10 filed by Virtus on December 19, 2008, and at www.phoenixwm.com and www.Virtus.com.

To ensure compliance with requirements imposed by the IRS, we inform you that any tax advice contained herein was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under federal, state or local tax law or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

Q: What is the “fair market value” of Virtus common stock to determine tax obligations?

A: The fair market value of Virtus common stock is $9.52. This figure was determined by calculating the volume-weighted average price of Virtus common shares on the first five trading days (January 2, and January 5-8).

Q: What is the cost basis of my new shares of Virtus common stock?

A: Your tax basis in Virtus common stock acquired through the spin-off is $9.52, or the fair market value at the time of the spin-off, as discussed above. Your new holding period in Virtus common stock began the day after the spin-off (January 1, 2009).

Q: When will I receive a Form 1099 related to this transaction?

A: The spin-off is a taxable transaction for the 2009 tax year, so you will receive a Form 1099-DIV related to this transaction in January, 2010.

Q: Did my ownership in Phoenix change as a result of the spin-off?

A: No. Immediately following the spin-off of Virtus, you continued to own the same quantity of Phoenix common stock that you owned immediately prior to the spin-off, which represented your interest in the Phoenix business, excluding Virtus (but including Phoenix’s wholly-owned subsidiary Goodwin Capital Advisors, Inc.). Phoenix common stock continues to be traded on the New York Stock Exchange under the symbol “PNX.”

Q: Will I receive a Virtus stock certificate?

A: No. Virtus stock is being issued through Direct Registration (DRS), a service provided by our distribution agent, transfer agent and registrar, Mellon Investor Services, LLC, operating under the service name of BNY Mellon Shareowner Services ("BNY Mellon") that allows shares to be owned and tracked electronically without having a stock certificate issued. Through DRS, your shares are held in your name and tracked electronically (in book-entry form) on the records of BNY Mellon. You retain full ownership of your shares, as well as all of the traditional voting rights and privileges of being a shareholder. Registered shareholders of Phoenix who were entitled to participate in the spin-off will have received a book-entry account statement reflecting their ownership of Virtus common stock. Phoenix shareholders who hold their shares through a broker, bank or other nominee had their brokerage account credited with Virtus common stock.

Q: Do I need to do anything now?

A: No. Neither Phoenix nor Virtus shareholders need to take any action at this time, although we urge you to read carefully these documents and the Information Statement dated December 23, 2008 and previously sent to Phoenix shareholders as of the record date.  That Information Statement is also available at the website of the Securities and Exchange Commission (www.sec.gov), as Exhibit 99.1 to the Form 10 filed by Virtus on December 19, 2008 and at www.phoenixwm.com and www.Virtus.com.

Q: What if I want to sell my Virtus common stock?

A: Information about the Virtus share sale programs is available through Virtus Shareowner Services at 866-205-7273. You may, of course, also use your own financial advisor for the sale of Virtus common stock.

Shareholders who are “uncertified” owners – meaning those shareholders who have not provided Virtus with a federal tax identification number prior to the record date – will have delayed access to selling their shares until shares are sold to satisfy federal tax withholding requirements. For more information, contact Virtus Shareowner Services at 866-205-7273.

You should consult with your own financial advisors, such as your stockbroker, bank or tax advisor. Virtus cannot make any recommendations on the purchase, retention or sale of shares of common stock.

Q: Who is the distribution agent, transfer agent and registrar for Virtus common stock?

A: The distribution agent, transfer agent and registrar for Virtus common stock is Broadridge Corporate Issuer Solutions, Inc. You can contact Virtus Shareowner Services:

  • By phone: 866-205-7273

  • On the web at the Virtus Shareholder Services Page: http://shareholder.broadridge.com/VRTS

  • By E-mail: Go to Virtus.com and click on "Contact Us" to send a message. For your protection, please do not include any confidential information, such as a Social Security number, when sending an E-mail message.

  • By mail:

    Regular Mail: Broadridge Corporate Issuer Solutions, Inc. -  PO Box 1342 -  Brentwood NY  11717

    Overnight Delivery: Broadridge Corporate Issuer Solutions, Inc. - Attn: IWS - 1155 Long Island Avenue - Edgewood NY  11717

Q: Where can Phoenix or Virtus stockholders get more information?

A: If you have any questions relating to the distribution or PNX common stock, you should contact:

The Phoenix Companies, Inc.
Investor Relations
One American Row
Hartford, CT 06102
Telephone: (860) 403-7100

If you have any questions relating to VRTS common stock, you should contact:

Virtus Investment Partners, Inc.
Investor Relations
100 Pearl Street
Hartford, CT 06103
Telephone: 800-248-7971 (Option 2)

In addition, Virtus has filed with the Securities and Exchange Commission a Form 10 with respect to the shares of Virtus common stock received by Phoenix stockholders in the spin-off. The Information Statement, dated December 23, 2008 and sent to shareholders as of the record date (and which was filed as Exhibit 99.1 to Amendment No. 4 to the Form 10 Registration Statement filed by Virtus on December 19, 2008) does not contain all of the information set forth in the Form 10 and the exhibits to the Form 10. For further information with respect to Virtus and the shares of our common stock, reference is hereby made to the Form 10, including its exhibits. Statements made in the Information Statement relating to the contents of any contract, agreement or other documents are not necessarily complete and you should refer to the exhibits attached to the Form 10 for copies of the actual contract, agreement or other document, with each such statement being qualified in all respects by reference to the document to which it refers.

You may review a copy of the Form 10, including its exhibits, at the SEC’s public reference room, located at 100 F Street, NE, Washington, DC 20549. You may obtain copies of all or any part of these materials from the SEC upon the payment of certain fees prescribed by the SEC. You may obtain further information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. In addition, copies of the Form 10 and related documents may be obtained through the SEC Web site at http://www.sec.gov.

In addition, Virtus has filed with the Securities and Exchange Commission a Form 10 with respect to the shares of Virtus common stock received by Phoenix stockholders in the spin-off. The Information Statement which was sent to you previously on December 26, 2008 (and which was filed as Exhibit 99.1 to the Form 10 Registration Statement filed by Virtus on December 19, 2008) does not contain all of the information set forth in the Form 10 and the exhibits to the Form 10. For further information with respect to Virtus and the shares of our common stock, reference is hereby made to the Form 10, including its exhibits. Statements made in the Information Statement relating to the contents of any contract, agreement or other documents are not necessarily complete and you should refer to the exhibits attached to the Form 10 for copies of the actual contract, agreement or other document, with each such statement being qualified in all respects by reference to the document to which it refers.

You may review a copy of the Form 10, including its exhibits, at the SEC’s public reference room, located at 100 F Street, NE, Washington, DC 20549. You may obtain copies of all or any part of these materials from the SEC upon the payment of certain fees prescribed by the SEC. You may obtain further information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. In addition, copies of the Form 10 and related documents may be obtained through the SEC Internet address at http://www.sec.gov.