EXHIBIT d.2
SUBADVISORY AGREEMENT
PHOENIX FOREIGN OPPORTUNITIES FUND
PHOENIX FOCUSED VALUE FUND
SUBADVISORY AGREEMENT
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June 20, 2005
Vontobel Asset Management, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
RE: SUBADVISORY AGREEMENT
Gentlemen:
Phoenix Adviser Trust (the "Fund") is a diversified open-end investment company
of the series type registered under the Investment Company Act of 1940 (the
"Act"), and is subject to the rules and regulations promulgated thereunder. The
shares of the Fund are offered or may be offered in several series. Phoenix
Investment Counsel, Inc. (the "Adviser") serves as an adviser to a number of
series organized under the Trust. In this capacity, the Adviser evaluates and
recommends subadvisers to provide investment management services to the various
series of the Trust. At this time the Adviser desires to engage the services of
Vontobel Asset Management, Inc. ("Vontobel" or the "Subadviser") to provide
investment management services to the Phoenix Foreign Opportunities Fund and the
Phoenix Focused Value Fund, both series of the Trust (collectively sometimes
hereafter referred to as the "Series"). The parties further contemplate the
possibility that, at some point in the future, the Adviser may request the
Subadviser to provide investment management services to other series of the
Trust, in which case the Subadviser's concurrence shall be manifested in
writing. It is further agreed that the provision of such investment management
services in the future by the Subadviser shall be governed by the terms and
provisions of this Agreement (as amended from time to time).
1. Employment as a Subadviser. The Adviser, being duly authorized, hereby
employs Vontobel as a discretionary Subadviser to invest and reinvest
the assets of the Series under the terms and conditions set forth
herein. The services of the Subadviser hereunder are not to be deemed
exclusive; the Subadviser may render services to others and engage in
other activities that do not conflict in any material manner in the
Subadviser's performance hereunder; however, for as long as the
subadvisory agreement is in place, in no event shall the Subadviser
provide future advisory or subadvisory services to another retail
open-ended registered investment company managed in a like style to the
Series and sold only through financial intermediaries except as agreed
upon in writing between the Adviser and the Subadviser, which agreement
will not be unreasonably withheld by the Adviser.
2. Acceptance of Employment; Standard of Performance. The Subadviser
accepts its employment as a discretionary series Subadviser of the
Series and agrees to use due care in making investment decisions for
the Series in accordance with the provisions of this Agreement and as
set forth in Schedule D attached hereto and made a part hereof.
3. Services of Subadviser. In providing management services to the Series,
the Subadviser shall be subject to the investment objectives, policies
and restrictions of the Fund as they apply to the Series and as set
forth in the Fund's then current Prospectus and Statement of Additional
Information (as the same may be modified from time to time and provided
to the Subadviser by Adviser), and to the investment restrictions set
forth in the Act and the Rules thereunder, to the supervision and
control of the Trustees of the Fund (the "Trustees"), and to
instructions from the Adviser. The Subadviser shall not, without the
Fund's prior approval, effect any transactions that would cause the
Series at the time of the transaction to be out of compliance with any
of such restrictions or policies
4. Transaction Procedures. All transactions for the Series will be
consummated by payment to, or delivery by, the Custodian(s) from time
to time designated by the Fund (the "Custodian"), or such depositories
or agents as may be designated by the Custodian in writing, of all cash
and/or securities due to or from the Series. The Subadviser shall not
have possession or custody of such cash and/or securities or any
responsibility or liability with respect to such custody. The
Subadviser shall advise the Custodian and confirm in an acceptable
format to the Fund all investment orders for the Series placed by it at
the time and in the manner set forth in Schedule A hereto (as amended
from time to time). The Fund shall issue to the Custodian such
instructions as may be appropriate in connection with the settlement of
any transaction initiated by the Subadviser. The Fund shall be
responsible for all custodial arrangements and the payment of all
custodial charges and fees, and, upon giving proper instructions to the
Custodian, the Subadviser shall have no responsibility or liability
with respect to custodial arrangements or the act, omissions or other
conduct of the Custodian.
5. Allocation of Brokerage. The Subadviser shall have authority and
discretion to select brokers and dealers to execute Series transactions
initiated by the Subadviser, and to select the markets on or in which
the transactions will be executed.
A. In placing orders for the sale and purchase of Series securities
for the Fund, the Subadviser's primary responsibility shall be to seek
the best execution of orders at the most favorable prices. However,
this responsibility shall not obligate the Subadviser to solicit
competitive bids for each transaction or to seek the lowest available
commission cost to the Fund, so long as the Subadviser reasonably
believes that the broker or dealer selected by it can be expected to
obtain a "best execution" market price on the particular transaction
and determines in good faith that the commission cost is reasonable in
relation to the
value of the brokerage and research services (as defined in Section
28(e)(3) of the Securities Exchange Act of 1934) provided by such
broker or dealer to the Subadviser, viewed in terms of either that
particular transaction or of the Subadviser's overall responsibilities
with respect to its clients, including the Fund, as to which the
Subadviser exercises investment discretion, notwithstanding that the
Fund may not be the direct or exclusive beneficiary of any such
services or that another broker may be willing to charge the Fund a
lower commission on the particular transaction.
B. The Subadviser shall not execute any Series transactions for the
Series with a broker or dealer that is an "affiliated person" (as
defined in the Act) of the Fund, the Subadviser or the Adviser without
the prior written approval of the Fund. The Fund will provide the
Subadviser with a list of brokers and dealers that are "affiliated
persons" of the Fund or Adviser.
6. Proxies. The Subadviser shall review all proxy solicitation materials
and be responsible for voting and handling all proxies in relation to
the Assets. Unless the Adviser or the Fund gives the Subadviser written
instructions to the contrary, the Subadviser will, in compliance with
the proxy voting procedures of the Series then in effect, vote or
abstain from voting, all proxies solicited by or with respect to the
issuers of securities in which assets of the Series may be invested.
The Advisor shall cause the Custodian to forward promptly to the
Subadviser all proxies upon receipt, so as to afford the Subadviser a
reasonable amount of time in which to determine how to vote such
proxies. The Subadviser agrees to provide the Advisor with quarterly
proxy voting reports in such form as the Advisor may request from time
to time. The Subadviser shall take such action as necessary to allow
for the timely filing of Form N-PX for the Fund.
7. Prohibited Conduct. In providing the services described in this
Agreement, the Subadviser will not consult with any other investment
advisory firm that provides investment advisory services to any
investment company sponsored by Phoenix Investment Partners, Ltd.
regarding transactions for the Fund in securities or other assets. In
addition, the Subadviser shall not, without the prior written consent
of the Fund and the Advisor, delegate any obligation assumed pursuant
to this Agreement to any affiliated or unaffiliated third party.
8. Fees for Services. The compensation of the Subadviser for its services
under this Agreement shall be calculated and paid by the Adviser in
accordance with the attached Schedule C. Pursuant to the Investment
Advisory Agreement between the Fund and the Adviser, the Adviser is
solely responsible for the payment of fees to the Subadviser.
9. Limitation of Liability. The Subadviser shall not be liable for any
action taken, omitted or suffered to be taken by it while using due
care, in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement, or
in accordance with specific directions or
instructions from the Fund, provided, however, that such acts or
omissions shall not have constituted a breach of the investment
objectives, policies and restrictions applicable to the Series and that
such acts or omissions shall not have resulted from the Subadviser's
willful misfeasance, bad faith or gross negligence, a violation of the
standard of care established by and applicable to the Subadviser in its
actions under this Agreement or a breach of its duty or of its
obligations hereunder (provided, however, that the foregoing shall not
be construed to protect the Subadviser from liability under the Act).
10. Confidentiality. Subject to the duty of the Subadviser and the Fund to
comply with applicable law, including any demand of any regulatory or
taxing authority having jurisdiction, the parties hereto shall treat as
confidential all information pertaining to the Series and the actions
of the Subadviser and the Fund in respect thereof.
11. Assignment. This Agreement shall terminate automatically in the event
of its assignment, as that term is defined in Section 2(a)(4) of the
Act. The Subadviser shall notify the Fund in writing sufficiently in
advance of any proposed change of control, as defined in Section
2(a)(9) of the Act, as will enable the Fund to consider whether an
assignment as defined in Section 2(a)(4) of the Act will occur, and to
take the steps necessary to enter into a new contract with the
Subadviser.
12. Representations, Warranties and Agreements of the Subadviser. The
Subadviser represents, warrants and agrees that:
A. It is registered as an "Investment Adviser" under the
Investment Advisers Act of 1940 ("Advisers Act").
B. It will maintain, keep current and preserve on behalf of
the Fund, in the manner required or permitted by the Act and
the Rules thereunder, the records identified in Schedule B (as
Schedule B may be amended from time to time). The Subadviser
agrees that such records are the property of the Fund, and
will be surrendered to the Fund or to Adviser as agent of the
Fund promptly upon request of either.
C. It has or shall adopt a written code of ethics complying
with the requirements of Rule 17j-l under the Act and will
provide the Fund and Adviser with a copy of the code of ethics
and evidence of its adoption. Subadviser acknowledges receipt
of the written code of ethics adopted by and on behalf of the
Fund (the "Code of Ethics"). Each calendar quarter while this
Agreement is in effect, a duly authorized compliance officer
of the Subadviser shall certify to the Fund and to Adviser
that the Subadviser has complied with the requirements of Rule
17j-l during the previous calendar quarter and that there has
been no violation of its code of ethics, or the Code of
Ethics, or if such a violation has occurred, that appropriate
action was taken in response to such violation. The Subadviser
shall permit the Fund and Adviser to examine the reports
required to be made by the Subadviser under Rule 17j-l(c)(1)
and this subparagraph.
D. Reference is hereby made to the Amended and Restated
Trust Instrument (the "Trust Instrument") dated May 9, 2003
establishing the Fund, a copy of which has been filed with the
Secretary of the State of Delaware and elsewhere as required
by law, and to any and all amendments thereto so filed with
the Secretary of the State of Delaware and elsewhere as
required by law, and to any and all amendments thereto so
filed or hereafter filed. The name "Phoenix Adviser Trust
(formerly Janus Adviser)" refers to the Trustees under said
Trust Instrument, as Trustees and not personally, and no
Trustee, shareholder, officer, agent or employee of the Fund
shall be held to any personal liability in connection with the
affairs of the Fund; only the trust estate under said Trust
Instrument. Without limiting the generality of the foregoing,
neither the Subadviser nor any of its officers, directors,
partners, shareholders or employees shall, under any
circumstances, have recourse or cause or willingly permit
recourse to be had directly or indirectly to any personal,
statutory, or other liability of any shareholder, Trustee,
officer, agent or employee of the Fund or of any successor of
the Fund, whether such liability now exists or is hereafter
incurred for claims against the trust estate.
13. Amendment. This Agreement may be amended at any time, but only by
written agreement among the Subadviser, the Adviser and the Fund, which
amendment, other than amendments to Schedules A, B, and D, is subject
to the approval of the Trustees and the Shareholders of the Fund as and
to the extent required by the Act.
14. Effective Date; Term. This Agreement shall become effective on the date
set forth on the first page of this Agreement, and shall continue in
effect for two years and for each year thereafter so long as its
continuance has been specifically approved at least annually by the
Trustees in accordance with Section 15(a) of the Investment Company
Act, and by the majority vote of the disinterested Trustees in
accordance with the requirements of Section 15(c) thereof.
15. Termination. This Agreement may be terminated by any party, without
penalty, immediately upon written notice to the other party in the
event of a breach of any provision thereof by a party so notified, or
otherwise upon thirty (30) days' written notice to the other party, but
any such termination shall not affect the status, obligations or
liabilities of any party hereto contained in Paragraphs 7 ("Fees for
Services"), 8 ("Limitation of Liability"), 9 ("Confidentiality"), 17
("Notices") or 19 ("Indemnification"). Because the Subadviser will or
may provide investment management services to more than one series of
the Trust, it shall be presumed that any notice of termination provided
under this Agreement
by one party to the other shall apply to each and every series of the
Trust to which the Subadviser provides investment management services
under this Agreement at the time the notice is tendered, unless the
notice provides that the termination is limited to less than all series
advised by the Subadviser and those series that are the subject of the
notice of termination are specifically identified in that notice.
16. Applicable Law. To the extent that state law is not preempted by the
provisions of any law of the United States heretofore or hereafter
enacted, as the same may be amended from time to time, this Agreement
shall be administered, construed and enforced according to the laws of
the State of Delaware.
17. Severability. If any term or condition of this Agreement shall be
invalid or unenforceable to any extent or in any application, then the remainder
of this Agreement shall not be affected thereby, and each and every term and
condition of this Agreement shall be valid and enforced to the fullest extent
permitted by law.
18. Notices. Any notice or other communication required to be given
pursuant to this Agreement shall be deemed duly given if delivered personally or
by overnight delivery service or mailed by certified or registered mail, return
receipt requested and postage prepaid, or sent by facsimile addressed to the
parties at their respective addresses set forth below, or at such other address
as shall be designated by any party in a written notice to the other party.
(a) To Phoenix at:
Phoenix Investment Counsel, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Chief Legal Officer
(b) To Vontobel at:
Vontobel Asset Management, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Chief Compliance Officer
19. Certifications. The Subadviser hereby warrants and represents that it
will provide the requisite certifications requested by the chief executive
officer and chief financial officer of the Fund necessary for those named
officers to fulfill their reporting and certification obligations on Forms N-CSR
and N-Q as required under the Xxxxxxxx-Xxxxx Act of 2002.
20. Indemnification. The Adviser agrees to indemnify and hold harmless the
Subadviser and the Subadviser's directors, officers, employees and agents from
and against any and all losses, liabilities, claims, damages, and expenses
whatsoever,
including reasonable attorneys' fees (collectively, "Losses"), arising out of or
relating to (i) any breach by the Adviser of any provision of this Agreement;
(ii) the negligence, willful misconduct, bad faith, or breach of fiduciary duty
of the Adviser; (iii) any violation by the Adviser of any law or regulation
relating to its activities under this Agreement; and (iv) any dispute between
the Adviser and any Fund shareholder, except to the extent that such Losses
result from the gross negligence, willful misconduct, bad faith, or breach of
fiduciary duty of the Subadviser.
PHOENIX ADVISER TRUST
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
PHOENIX INVESTMENT COUNSEL, INC.
By: /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
Vice President and Clerk
ACCEPTED:
VONTOBEL ASSET MANAGEMENT, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
Vice President & Chief Compliance Officer
By: /s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx
President & Chief Executive Officer
SCHEDULES: A. Operational Procedures
B. Record Keeping Requirements
C. Fee Schedule
D. Subadviser Functions
SCHEDULE A
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OPERATIONAL PROCEDURES
In order to minimize operational problems, it will be necessary for a flow of
information to be supplied to State Street Bank and Trust Company (the
"Custodian"), the custodian for the Fund and PFPC, Inc., the sub-financial agent
for the Fund.
The Subadviser must furnish the Custodian and the sub-financial agent with daily
information as to executed trades, or, if no trades are executed, with a report
to that effect, no later than 5 p.m. (Eastern Standard time) on the day of the
trade (confirmation received from broker). The necessary information can be sent
via facsimile machine to the Custodian. Information provided to the Custodian
shall include the following:
1. Purchase or sale;
2. Security name;
3. CUSIP number (if applicable);
4. Number of shares and sales price per share;
5. Executing broker;
6. Settlement agent;
7. Trade date;
8. Settlement date;
9. Aggregate commission or if a net trade;
10. Interest purchased or sold from interest bearing security;
11. Other fees;
12. Net proceeds of the transaction;
13. Exchange where trade was executed;
14. Identified tax lot (if applicable);
15. Yield (if applicable);
16. Original face amount (if applicable);
17. Ratings (if applicable); and
18. Trade reason code.
When opening accounts with brokers for, and in the name of, the Fund, the
account must be a cash account. No margin accounts are to be maintained in the
name of the Fund. Trades in initial public offerings must be communicated by 4
p.m. ET on trade date. Delivery instructions are as specified by the Custodian.
The Custodian will supply the Subadviser daily with a cash availability report.
This will normally be done by fax or electronic mail so that the Subadviser will
know the amount available for investment purposes.
SCHEDULE B
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RECORDS TO BE MAINTAINED BY THE SUBADVISER
1. (Rule 31a-1(b)(5)) A record of each brokerage order, and all other
series purchases and sales, given by the Subadviser on behalf of the
Fund for, or in connection with, the purchase or sale of securities,
whether executed or unexecuted. Such records shall include:
A. The name of the broker;
B. The terms and conditions of the order and of any modifications or
cancellations thereof;
C. The time of entry or cancellation;
D. The price at which executed;
E. The time of receipt of a report of execution; and
F. The name of the person who placed the order on behalf of the Fund.
2. (Rule 31a-1(b)(9)) A record for each fiscal quarter, completed within
ten (10) days after the end of the quarter, showing specifically the
basis or bases upon which the allocation of orders for the purchase and
sale of series securities to named brokers or dealers was effected, and
the division of brokerage commissions or other compensation on such
purchase and sale orders. Such record:
A. Shall include the consideration given to:
(i) The sale of shares of the Fund by brokers or dealers.
(ii) The supplying of services or benefits by brokers or dealers
to:
(a) The Fund,
(b) The Adviser (Phoenix Investment Counsel, Inc.)
(c) The Subadviser, and
(d) Any person other than the foregoing.
(iii) Any other consideration other than the technical
qualifications of the brokers and dealers as such.
B. Shall show the nature of the services or benefits made available.
C. Shall describe in detail the application of any general or
specific formula or other determinant used in arriving at such
allocation of purchase and sale orders and such division of
brokerage commissions or other compensation.
D. The name of the person responsible for making the determination of
such allocation and such division of brokerage commissions or other
compensation.
3. (Rule 31a-(b)(10)) A record in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the
purchase or sale of series securities. Where a committee or group makes
an authorization, a record shall be kept of the names of its members
who participate in the authorization. There shall be retained as part
of this record: any memorandum, recommendation or instruction
supporting or authorizing the purchase or sale of series securities and
such other information as is appropriate to support the authorization.*
4. (Rule 31a-1(f)) Such accounts, books and other documents as are
required to be maintained by registered investment advisers by rule
adopted under Section 204 of the Investment Advisers Act of 1940, to
the extent such records are necessary or appropriate to record the
Subadviser's transactions for the Fund.
5. (NASD Rule 3110). Such books, accounts, records, memoranda, and
correspondence in conformity with all applicable laws, rules,
regulations and statements of policy promulgated thereunder and with
the Rules of the Association and as prescribed by SEC Rule 17a-3. The
record keeping format, medium, and retention period shall comply with
Rule 17a-4 under the Securities Exchange Act of 1934.
*Such information might include: current financial information, annual and
quarterly reports, press releases, reports by analysts and from brokerage firms
(including their recommendation; i.e., buy, sell, hold) or any internal reports
or subadviser review.
SCHEDULE C
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SUBADVISORY FEE
(a) For services provided to the Fund, the Adviser will pay to the
Subadviser, on or before the 10th day of each month, a fee, payable in arrears,
at the annual rate set forth below by Series of the gross management fee as
stipulated in the Fund's registration statement. The fees shall be prorated for
any month during which this agreement is in effect for only a portion of the
month. In computing the fee to be paid to the Subadviser, the net asset value of
the Fund and each Series shall be valued as set forth in the then current
registration statement of the Fund.
Phoenix Focused Value Fund: Zero to $50 million 70 basis points
Above $50 million 37.5 basis points
Phoenix Foreign Opportunities
Fund: Zero to $50 million 80 basis points
Above $50 million 42.5 basis points
The fee referred to above shall be wired to Vontobel's account set forth below:
Bank: XX Xxxxxx Xxxxx & Co.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
ABA No. 000000000
SWIFT: XXXXXX00
Beneficiary: Vontobel Asset Management, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Account No. 904810445
SCHEDULE D
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SUBADVISER FUNCTIONS
With respect to managing the investment and reinvestment of the Series'
assets, the Subadviser shall provide, at its own expense:
(a) An investment program for the Series consistent with its
investment objectives based upon the development, review and
adjustment of buy/sell strategies approved from time to time
by the Board of Trustees and Adviser and as disclosed in the
Fund's registration statement;
(b) Implementation of the investment program for the Series based
upon the foregoing criteria;
(c) Quarterly reports, in form and substance acceptable to the
Adviser, with respect to: i) compliance with the Code of
Ethics and the Subadviser's code of ethics;; ii)
diversification of Series assets in accordance with the then
prevailing prospectus and statement of additional information
pertaining to the Series and governing laws; iii) compliance
with governing restrictions including but not limited to the
Valuation Procedures adopted by the Board of Trustees to the
Fund and other procedures for the fair valuation of securities
for which market quotations and the liquidity determination
are not readily available or considered "illiquid" for the
purposes of complying with the Series' limitation on
acquisition of illiquid securities; iiii) any and all other
reports reasonably requested in accordance with or described
in this Agreement; and, iv) the implementation of the Series'
investment program, including, without limitation, analysis of
Series performance;
(d) Promptly after filing with the Securities and Exchange
Commission an amendment to its Form ADV, a copy of such
amendment to the Adviser and the Trustees;
(e) Attendance by appropriate representatives of the Subadviser at
meetings requested by the Adviser or Trustees at such time(s)
and location(s) as reasonably requested by the Adviser or
Trustees;
(f) Notice to the Trustees and the Adviser of the occurrence of
any event which would disqualify the Subadviser from serving
as an investment adviser of an investment company pursuant to
Section 9(a) of the Investment Company Act of 1940 or
otherwise; and
(g) A business continuity and disaster recovery program in
accordance with applicable industry best practices.
