EXHIBIT 6.b.1
SUBADVISORY AGREEMENT
THE PHOENIX EDGE SERIES FUND
SUBADVISORY AGREEMENT
June 23, 2006
Xxxxxx Investment Management, Inc.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
RE: SUBADVISORY AGREEMENT
Ladies and Gentlemen:
The Phoenix Edge Series Fund (the "Trust") 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 Trust are offered or may be offered in several series
(collectively, sometimes hereafter referred to as the "Series").
Phoenix Investment Counsel, Inc. (the "Adviser") evaluates and recommends series
subadvisers for the Series and is responsible for the day-to-day management of
the Series.
1. Employment as a Subadviser. The Adviser, being duly authorized, hereby
employs Xxxxxx Investment Management, Inc. (the "Subadviser") as a
discretionary series subadviser to invest and reinvest the assets of each of
the Series set forth on Schedule F attached hereto (the "Designated Series")
on the terms and conditions set forth herein. The services of the Subadviser
hereunder are not to be deemed exclusive by reason of this Agreement (and
without prejudice to any applicable restrictions set forth in any other
written agreement between the Subadviser or any of its affiliates, on the
one hand, and the Adviser or any of its affiliates, on the other hand); the
Subadviser may (subject to the terms of any such other written agreements)
render services to others and engage in other activities that do not
conflict in any material manner with the Subadviser's performance hereunder.
2. Acceptance of Employment; Standard of Performance. The Subadviser accepts
its employment as a discretionary series subadviser of each of the
Designated Series and agrees to use its best professional judgment to make
investment decisions for each such Designated 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 each of the
Designated Series, the Subadviser shall be subject to the investment
objectives, policies and restrictions of the Trust as they apply to such
Designated Series and as set forth in the Trust's then current prospectus
("Prospectus") and statement of additional information ("Statement of
Additional Information") filed with the Securities and Exchange Commission
(the "SEC") as part of the Trust's Registration Statement, as may be
periodically amended and provided to the Subadviser by the 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 Trust (the
"Trustees"), and to instructions from the Adviser. The Subadviser shall not,
without the Trust's prior written approval, effect any transactions that
would cause any Designated Series at the time of the transaction to be out
of compliance with any of such restrictions or policies applicable to such
Designated Series.
4. Transaction Procedures. All series transactions for the Designated Series
shall be consummated by payment to, or delivery by, the custodian(s) from
time to time designated by the Trust (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 writing to the Trust all investment orders for the
Designated Series placed by it with brokers and dealers at the time and in
the manner set forth in Schedule A hereto (as amended from time to time).
The Trust shall issue to the Custodian such instructions as may be
appropriate in connection with the settlement of any transaction initiated
by the Subadviser. The Trust 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 Portfolio Transactions. The Subadviser shall have authority
and discretion to select brokers and dealers to execute Designated Series
transactions initiated by the Subadviser, and to select the markets in which
the transactions will be executed.
A. In placing orders for the sale and purchase of the Designated Series'
securities for the Trust, 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 Trust, 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
Trust, as to which the Subadviser exercises investment discretion,
notwithstanding that the Trust may not be the direct or exclusive
beneficiary of any such services or that another broker may be willing
to charge the Trust a lower commission on the particular transaction.
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B. The Subadviser may manage other portfolios and expects that the Trust
and other portfolios the Subadviser manages will, from time to time,
purchase or sell the same securities. The Subadviser may aggregate
orders for the purchase or sale of securities on behalf of the
Designated Series with orders on behalf of other portfolios the
Subadviser manages in accordance with the policies with respect to the
execution of portfolio transactions as set forth in the Fund's then
current Prospectus and Statement of Additional Information, as amended
from time to time, and under the Act. Securities purchased or proceeds
of securities sold through aggregated orders shall be allocated to the
account of each portfolio managed by the Subadviser that bought or sold
such securities at the average execution price. If less than the total
of the aggregated orders is executed, purchased securities or proceeds
shall generally be allocated pro rata among the participating portfolios
in proportion to their planned participation in the aggregated orders.
C. The Subadviser shall not execute any transactions for the Designated
Series with a broker or dealer that is an "affiliated person" (as
defined in the Act) of the Trust, the Subadviser or the Adviser unless
such execution is in compliance with the procedures and standards
adopted by the Board of Trustees, as set forth in the Fund's then
current Prospectus and Statement of Additional Information, as amended
from time to time, and under the Act. The Trust shall provide the
Subadviser with a list of brokers and dealers that are "affiliated
persons" of the Trust or the Adviser and will notify the Subadviser as
promptly as practicable when such list changes.
D. The Subadviser shall at all times place orders for the sale and purchase
of securities in accordance with the brokerage policy of the Designated
Series as set forth in the Prospectus subject to the oversight of the
Adviser and/or the Trustees.
6. Proxies.
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A. The Subadviser, or a third party designee acting under the authority and
supervision of the Subadviser, shall review all proxy solicitation
materials and be responsible for voting and handling all proxies in
relation to the assets of the Designated Series. Unless the Adviser or
the Trust gives the Subadviser written instructions to the contrary, the
Subadviser or an agent designated by the Subadviser will, in compliance
with the proxy voting procedures of the Designated 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 Designated
Series may be invested. The Adviser 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 Adviser in a timely
manner with a record of votes cast containing all of the voting
information required by Form N-PX in an electronic format to enable the
Trust to file Form N-PX as required by Rule 30b1-4 under the Act.
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B. The Subadviser is authorized to deal with reorganizations and exchange
offers with respect to securities held in the Series in such manner as
the Subadviser deems advisable, unless the Trust or the Adviser
otherwise specifically directs in writing.
7. Prohibited Conduct. In providing the services described in this Agreement,
the Subadviser's responsibility regarding investment advice hereunder is
limited to the Designated Series, and the Subadviser will not consult with
any other investment advisory firm that provides investment advisory
services to the Trust or any other investment company sponsored by Phoenix
Investment Partners, Ltd. Regarding transactions for the Trust in securities
or other assets. The Trust shall provide the Subadviser with a list of
investment companies sponsored by Phoenix Investment Partners, Ltd. and the
Subadviser shall be in breach of the foregoing provision only if the
investment company is included in such a list provided to the Subadviser
prior to such prohibited action. In addition, the Subadviser shall not,
without the prior written consent of the Trust and the Adviser, delegate any
obligation assumed pursuant to this Agreement to any affiliated or
unaffiliated third party.
8. Information and Reports.
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A. The Subadviser shall keep the Trust and the Adviser informed of
developments relating to its duties as Subadviser of which the
Subadviser has, or should have, knowledge that would materially affect
the Designated Series. In this regard, the Subadviser shall provide the
Trust, the Adviser and their respective officers with such reports
concerning the obligations the Subadviser has assumed under this
Agreement as the Trust and the Adviser may from time to time reasonably
request. In addition, prior to each regular meeting of the Trustees, the
Subadviser shall provide the Adviser and the Trustees with reports
regarding the Subadviser's management of the Designated Series managed
by the Subadviser during the most recently completed quarter which
reports: (i) shall include, to the extent possible, Subadviser's
representation that its performance of its investment management duties
hereunder is in compliance with the Trust's investment objectives and
practices, the Act and applicable rules and regulations under the Act,
and the diversification requirements of Subchapter M and Section 817(h)
of the Internal Revenue Code of 1986, as amended, and (ii) otherwise
shall be in such form as may be mutually agreed upon by the Subadviser
and the Adviser.
B. Each of the Adviser and the Subadviser shall provide the other party
with a list, to the best of the Adviser's or the Subadviser's respective
knowledge, of each affiliated person, as defined under Section 2(a)(3)
of the Act, and any affiliated person of such an affiliated person, of
the Adviser or the Subadviser, as the case may be, and each of the
Adviser and Subadviser agrees promptly to update such list whenever the
Adviser or the Subadviser becomes aware of any changes that should be
added to or deleted from the list of affiliated persons.
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C. The Subadviser shall also provide the Adviser with any information
reasonably requested by the Adviser regarding its management of the
Designated Series required for any shareholder report, amended
registration statement, or Prospectus supplement to be filed by the
Trust with the SEC.
9. 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 Trust and the Adviser (the "Advisory Agreement"), the Adviser is
solely responsible for the payment of fees to the Subadviser.
10. Limitation of Liability. The Subadviser shall not by reason of this
Agreement (and without prejudice to any liabilities the Subadviser may have
pursuant to any other written agreement between the Subadviser or any of its
affiliates, on the one hand, and the Adviser or any of its affiliates, on
the other hand) be liable for any action taken, omitted or suffered to be
taken by it in its best professional judgment, 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 Trust, provided, however, that such acts or omissions
shall not have constituted a material breach of the investment objectives,
policies and restrictions or laws or regulations applicable to any of the
Designated Series as defined in the Prospectus and Statement of Additional
Information or under the Act or other applicable laws or regulations, as
applicable, and that such acts or omissions shall not have resulted from the
Subadviser's willful misfeasance, bad faith or gross negligence, or reckless
disregard of its obligations and duties hereunder.
11. Confidentiality. Subject to the duty of the Subadviser and the Trust to
comply with applicable law (but without prejudice to any applicable
restrictions set forth in any other written agreement between the Subadviser
or any of its affiliates, on the one hand, and the Adviser or any of its
affiliates, on the other hand), including any demand of any regulatory or
taxing authority having jurisdiction, the Subadviser shall treat as
confidential all information pertaining to the Designated Series and the
actions of the Subadviser and the Trust in respect thereof. The parties
acknowledge and agree that all nonpublic personal information with regard to
shareholders in the Designated Series shall be deemed proprietary
information of the Designated Series of the Trust, and that the Subadviser
shall use that information solely in the performance of its duties and
obligations under this Agreement and shall take reasonable steps to
safeguard the confidentiality of that information. Further, the Subadviser
shall maintain and enforce adequate security procedures with respect to all
materials, records, documents and data relating to any of its
responsibilities pursuant to this Agreement including all means for the
effecting of investment transactions.
12. 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 Trust 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 Trust to consider whether an assignment as
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defined in Section 2(a)(4) of the Act will occur, and to take the steps
necessary to enter into a new subadvisory agreement. The Subadviser will be
liable to the Fund and the Adviser for all administrative costs resulting
from a change of control of the Subadviser, including without limitation all
costs associated with any proxy solicitations, Board meetings and revisions
to the Prospectus or marketing materials. The understandings and obligations
set forth in this Section shall survive the termination of this Agreement
and shall be binding upon the Subadviser and its successors.
13. Representations, Warranties and Agreements of the Subadviser. The Subadviser
represents, warrants and agrees (without prejudice to any applicable
requirements set forth in any other written agreement between the Subadviser
or any of its affiliates, on the one hand, and the Adviser or any of its
affiliates, on the other hand) that:
A. It is registered as an "Investment Adviser" under the Investment
Advisers Act of 1940, as amended ("Advisers Act").
B. It will maintain, keep current and preserve on behalf of the Trust, in
the manner required or permitted by the Act and the rules thereunder
including 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 Trust, and shall be surrendered to the Trust or to
the Adviser as agent of the Trust promptly upon request of either. The
Trust acknowledges that Subadviser may retain copies of all records
required to meet the record retention requirements imposed by law and
regulation.
C. It shall maintain a written code of ethics (the "Code of Ethics")
complying with the requirements of Rule 204A-1 under the Advisers Act
and Rule 17j-l under the Act and shall provide the Trust and the Adviser
with a copy of the Code of Ethics and evidence of its adoption. It shall
institute procedures reasonably necessary to prevent Access Persons (as
defined under Rule 17j-1) from violating its Code of Ethics. The
Subadviser acknowledges receipt of the written code of ethics adopted by
and on behalf of the Trust. Each calendar quarter while this Agreement
is in effect, a duly authorized compliance officer of the Subadviser
shall certify to the Trust and to the Adviser that the Subadviser has
complied with the requirements of Rules 204A-1 and 17j-l during the
previous calendar quarter and that there has been no material violation
of its Code of Ethics, or of Rule 17j-1(b), or that any persons covered
under its Code of Ethics has divulged or acted upon any material,
non-public information, as such term is defined under relevant federal
securities laws, and if such a violation has occurred that appropriate
action was taken in response to such violation. Annually, the Subadviser
shall furnish to the Trust and the Adviser a written report which
complies with the requirements of Rule 17j-1 concerning the Subadviser's
Code of Ethics to the Trust and the Adviser. The Subadviser shall permit
the Trust and the Adviser to examine the reports required to be made by
the Subadviser under Rules 204A-1(b) and 17j-l(d)(1) and this
subparagraph.
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D. It has adopted and implemented, and throughout the term of this
Agreement shall maintain in effect and implement, policies and
procedures reasonably designed to prevent, detect and correct violations
by the Subadviser and its supervised persons, and, to the extent the
activities of the Subadviser in respect to the Trust could affect the
Trust, by the Trust, of federal securities laws, as defined in Rule
38a-1 under the Act, and that the Subadviser has provided the Trust with
true and complete copies of its policies and procedures (or summaries
thereof) and related information reasonably requested by the Trust. The
Subadviser agrees to cooperate with periodic reviews by the Trust's
compliance personnel of the Subadviser's policies and procedures, their
operation and implementation and other compliance matters and to provide
to the Trust from time to time such additional information and
certifications in respect of the Subadviser's policies and procedures,
compliance by the Subadviser with federal securities laws and related
matters and the Trust's compliance personnel may reasonably request. The
Subadviser agrees to promptly notify the Adviser of any compliance
violations which affect the Designated Series.
E. Reference is hereby made to the Declaration of Trust dated [date], as
subsequently amended, establishing the Trust, a copy of which has been
filed with the Secretary of the Commonwealth of Massachusetts and
elsewhere as required by law, and to any and all amendments thereto so
filed with the Secretary of the Commonwealth of Massachusetts and
elsewhere as required by law, and to any and all amendments thereto so
filed or hereafter filed. The name "The Phoenix Edge Series Fund" refers
to the Trustees under said Declaration of Trust, as Trustees and not
personally, and no Trustee, shareholder, officer, agent or employee of
the Trust shall be held to any personal liability in connection with the
affairs of the Trust; only the trust estate under said Declaration of
Trust is liable. 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 Trust or of any successor of
the Trust, whether such liability now exists or is hereafter incurred
for claims against the trust estate.
F. It will use all necessary efforts to manage the Designated Series so
that it will satisfy the diversification requirements of Section 817(h)
of the Internal Revenue Code of 1986, as amended.
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14. Entire Agreement; Amendment. This Agreement, together with the Schedules
attached hereto, constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes any prior written or
oral agreements pertaining to the subject matter of this Agreement. This
Agreement may be amended at any time, but only by written agreement among
the Subadviser, the Adviser and the Trust, which amendment, other than
amendments to Schedules A, B, D, E and F, is subject to the approval of the
Trustees and the shareholders of the Designated Series as and to the extent
required by the Act.
15. 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
until November 30, 2007. The Agreement shall continue from year to year
thereafter only so long as its continuance has been specifically approved at
least annually by the Trustees in accordance with Section 15(a) of the Act,
and by the majority vote of the disinterested Trustees in accordance with
the requirements of Section 15(c) thereof.
16. Termination. This Agreement may be terminated as to the entire Trust or any
individual Designated Series by any of the Adviser, the Subadviser or the
Trust without penalty hereunder, immediately upon written notice to the
other parties in the event of a material breach of any provision thereof by
a party so notified, or otherwise upon sixty (60) days' written notice to
the other parties, but any such termination shall not affect the obligations
or liabilities of any party hereto to the other parties with respect to
events occurring prior to such termination. In the event that this Agreement
is terminated pursuant to the immediately preceding sentence with respect to
some but not all of the Designated Series, this Agreement shall remain in
full force and effect in accordance with its terms with respect to each of
the remaining Designated Series with respect to which it has not been
terminated.
17. 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
Commonwealth of Massachusetts.
18. 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.
19. 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.
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(a) To Phoenix or the Trust at:
Phoenix Investment Counsel, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx, Vice President and Clerk
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxx.xxxxx@xxxxxxxxx.xxx
(b) To Xxxxxx Investment Management, Inc. at:
Xxxxxx Investment Management, Inc.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxxx.xxxxxxxxx@xxxxxxxxxx.xxx
Attn: Xxxxxx X. XxXxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxxx.xxxxxx@xxxxxxxxxx.xxx
20. Certifications. The Subadviser hereby warrants and represents that it will
provide, to the extent compliant with all applicable laws, the requisite
certifications reasonably requested by the chief executive officer and chief
financial officer of the Trust necessary for those named officers to fulfill
their reporting and certification obligations on Form N-CSR and Form N-Q as
required under the Xxxxxxxx-Xxxxx Act of 2002 to the extent that such
reporting and certifications relate to the Subadviser's duties and
responsibilities under this Agreement. Subadviser shall provide a quarterly
certification in a form substantially similar to that attached as Schedule
E.
21. Indemnification.
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(a) The Adviser agrees to indemnify and hold harmless the Subadviser,
its officers and directors, and any person who "controls" the Subadviser,
within the meaning of Section 15 of the Securities Act of 1933, as amended
(the "1933 Act"), from and against any and all direct or indirect
liabilities, losses or damages (including reasonable attorneys' fees and
costs) suffered by Subadviser arising from, or connected with, (i) the
Adviser's breach of any provision of this Agreement, (ii) willful
misfeasance, bad faith, reckless disregard or gross negligence on the part
of the Adviser or any of its officers, directors or employees in or relating
to the performance of the Adviser's duties and obligations under this
Agreement, (iii) the operation of the Designated Series or the Fund, or the
distribution of shares of the Designated Series or the Fund, (iv) the
performance, non-performance or omission of any third-party service provider
to the Designated Series or (v) any untrue statement or alleged untrue
statement of a material fact contained in the
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Prospectus and Statement of Additional Information, as amended or
supplemented from time to time or promotional materials pertaining or
relating to the Designated Series or any amendment thereof or any supplement
thereto or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement therein not
misleading, if such a statement or omission was made by the Fund other than
in reliance upon written information furnished by the Subadviser or any
affiliated person of the Subadviser, expressly for use in the Fund's
registration statement or other than upon verbal information confirmed by
the Subadviser in writing expressly for use in the Fund's registration
statement. The Adviser acknowledges and agrees that the Subadviser makes no
representation or warranty, express or implied, that any level of
performance or investment results will be achieved by the Designated Series
or that the Designated Series will perform comparably with any standard or
index, including other clients of the Subadviser, whether public or private.
In no case shall the Adviser's indemnity in favor of the Subadviser or any
affiliated person or controlling person of the Subadviser, or any other
provision of this Agreement, be deemed to protect such person against any
liability to which any such person would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties
under this Agreement.
(b) The Subadviser agrees to indemnify and hold harmless the Adviser,
its officers and directors, and any person who "controls" the Adviser,
within the meaning of Section 15 of the 1933 Act, from and against any and
all direct or indirect liabilities, losses or damages (including reasonable
attorneys' fees and costs) suffered by Adviser arising from or connected
with (i) the Subadviser's breach of its duties under this Agreement, (ii)
willful misfeasance, bad faith, reckless disregard or gross negligence on
the part of the Subadviser or any of its officers, directors or employees in
the performance of the Subadviser's duties and obligations under this
Agreement or (iii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus or Statement of Additional
Information, as amended or supplemented from time to time relating to the
Designated Series or any amendment thereof or any supplement thereto or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading, if
such a statement or omission was made in reliance upon written information
furnished by the Subadviser or any affiliated person of the Subadviser to
the Adviser, the Fund or any affiliated person of the Adviser or the Fund
expressly for use in the Fund's registration statement, or upon verbal
information confirmed by the Subadviser in writing expressly for use in the
Fund's registration statement; or (iv) to the extent of, and as a result of,
the failure of the Subadviser to execute, or cause to be executed, portfolio
transactions according to the standards and requirements of the Securities
Exchange Act of 1934, the 1940 Act and the Advisers Act.
In no case shall the Subadviser's indemnity in favor of the Adviser or any
affiliated person or controlling person of the Adviser, or any other
provision of this Agreement, be deemed to protect such person against any
liability to which any such person would
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otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties under this Agreement.
22. Receipt of Disclosure Document. The Trust acknowledges receipt, at least 48
hours prior to entering into this Agreement, of a copy of Part II of the
Subadviser's Form ADV containing certain information concerning the
Subadviser and the nature of its business.
23. Counterparts; Fax Signatures. This Agreement may be executed in any number
of counterparts (including executed counterparts delivered and exchanged by
facsimile transmission) with the same effect as if all signing parties had
originally signed the same document, and all counterparts shall be construed
together and shall constitute the same instrument. For all purposes,
signatures delivered and exchanged by facsimile transmission shall be
binding and effective to the same extent as original signatures.
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THE PHOENIX EDGE SERIES FUND
By: /s/ Xxxx Xxxxxxx X'Xxxxxxx
------------------------------------
Name: Xxxx Xxxxxxx X'Xxxxxxx
Title: Senior Vice President
PHOENIX INVESTMENT COUNSEL, INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Vice President and Clerk
ACCEPTED:
XXXXXX INVESTMENT MANAGEMENT, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Senior Partner and Chief Financial Officer
SCHEDULES: A. Operational Procedures
B. Record Keeping Requirements
C. Fee Schedule
D. Subadviser Functions
E. Form of Sub-Certification
F. Designated Series
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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 by Subadviser to State Street and Bank Trust Company
(the "Custodian") and PFPC, Inc., (the "Sub-Accounting Agent") for the Trust.
The Subadviser must furnish the Custodian and the Sub-Accounting 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 each day the Trust is open for business. (Subadviser will be
responsible for reimbursement to the Trust for any loss caused by the
Subadviser's failure to comply.) It is permissible to send the necessary
information via facsimile machine to the Custodian and the Sub-Accounting Agent.
Information provided to the Custodian and the Sub-Accounting Agent shall include
the following:
1. Purchase or sale;
2. Security name;
3. CUSIP number, ISIN or Sedols (as applicable);
4. Number of shares and sales price per share or aggregate principal amount;
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; and
14. Trade commission reason: best execution, soft dollar or research.
When opening accounts with brokers for, and in the name of, the Trust, the
account must be a cash account. No margin accounts are to be maintained in the
name of the Trust. Delivery instructions are as specified by the Custodian. The
Custodian will supply the Subadviser daily with a cash availability report via
access to the Custodian website, or by email or by facsimile and the
Sub-Accounting Agent will provide a five day cash projection. This will normally
be done by email or, if email is unavailable, by another form of immediate
written communication, so that the Subadviser will know the amount available for
investment purposes.
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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 Trust 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 Trust.
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 Trust by brokers or dealers.
(ii) The supplying of services or benefits by brokers or dealers to:
(a) The Trust,
(b) The Adviser,
(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-1(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.*
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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 Advisers Act, to the extent such records are necessary or
appropriate to record the Subadviser's transactions for the Trust.
5. Records as necessary under Board-approved The Phoenix Edge Series Fund's
valuation policies and procedures.
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* Such information might include: current financial information, annual and
quarterly reports, press releases, reports by analysts and from brokerage firms
(including their recommendations, i.e., buy, sell, hold) or any internal reports
or subadviser review.
15
SCHEDULE C
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SUBADVISORY FEE
(a) For services provided hereunder, the Adviser will pay to the Subadviser,
on or before the 10th day of each month, a fee with respect to each Designated
Series, payable in arrears, at the annual rate stated in paragraph (b) below.
The fees payable in respect of a Designated Series shall be prorated for any
month during which this Agreement is in effect for only a portion of the month
with respect to such Designated Series. In computing the fee to be paid to the
Subadviser, the net asset value of the Trust and each Designated Series shall be
valued as set forth in the then-current registration statement of the Trust.
(b) The fee to be paid by the Adviser to the Subadviser with respect to each
Designated Series shall be at the annual sub-advisory fee rate set forth
opposite such Designated Series' name below; provided, however, that, in the
event there is any reduction after the date of the Transaction Agreement in the
annual advisory fee rate payable by a Designated Series to the Adviser pursuant
to the Advisory Agreement, the annual sub-advisory fee rate payable by the
Adviser to the Subadviser with respect to such Designated Series automatically
shall be reduced by 50% of the amount of such reduction in such annual advisory
fee rate (measured in basis points); and provided, further, that, in the event
the net advisory fee retained by the Adviser with respect to a Designated Series
(for the avoidance of doubt, after taking into account any applicable waivers,
reimbursements or other similar offsets or arrangements applicable to such
Designated Series that are required to be paid by the Adviser or its affiliates)
is less than the annual contractual advisory fee payable by a Designated Series
to the Adviser pursuant to the Advisory Agreement, the fee to be paid by the
Adviser to the Subadviser with respect to such Designated Series automatically
shall be reduced by 50% of the amount of such difference between such
contractual advisory fee rate and such net advisory fee actually retained by the
Adviser with respect to such Designated Series (and the Subadviser agrees
promptly upon request to reimburse to the Adviser any over-payments previously
made pursuant to this Agreement to the extent that such amounts ultimately are
reasonably determined by the Adviser to be in excess of the amounts required to
be paid pursuant hereto after taking into account any annual or other periodic
reimbursements or similar payments required to be made by the Adviser or its
affiliates to the Trust or a Designated Series in connection with any such
waivers, reimbursements or other similar offsets or arrangements):
NAME OF DESIGNATED SERIES ANNUAL SUB-ADVISORY FEE RATE
Phoenix Capital Growth Fund 0.30
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SCHEDULE D
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SUBADVISER FUNCTIONS
With respect to managing the investment and reinvestment of the Designated
Series' assets, the Subadviser shall provide, at its own expense:
(a) An investment program for each Designated 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 the Adviser in paragraph 3 of this Subadvisory Agreement
and implementation of that program;
(b) Periodic reports, on at least a quarterly basis, in form and substance
acceptable to the Adviser, including but not limited to reports with
respect to: i) compliance with the Subadviser's Code of Ethics; ii)
compliance with procedures adopted from time to time by the Trustees of
the Trust relative to securities eligible for resale under Rule 144A
under the Securities Act of 1933, as amended; iii) diversification of
each Designated Series' assets in accordance with the then governing
laws and prevailing Prospectus and Statement of Additional Information
pertaining to the Designated Series and governing laws, regulations,
rules and orders; iv) compliance with governing Fund policies and
restrictions relating to the fair valuation of securities for which
market quotations are not readily available or considered "illiquid" for
the purposes of complying with the Designated Series' limitation on
acquisition of illiquid securities; v) cross transactions conducted
pursuant to Rule 17a-7 under the 1940 Act; vi) allocations of brokerage
transactions along with descriptions of the bases for those allocations
and the receipt and treatment of brokerage and research services
received, as may be requested to ensure compliance with Section 28(e) of
the Securities Exchange Act of 1934; vii) any and all other reports
reasonably requested in accordance with or described in this Agreement;
and viii) the implementation of the Designated Series' investment
program, including, without limitation, analysis of Designated Series
performance;
(c) Annual or other periodic reports, in form and substance acceptable to
the Adviser, including but not limited reports with respect to: (i)
analyses of Designated Series performance; (ii) disclosure related to
the portfolio management of the Designated Series and the Subadviser as
may be contained in the Prospectus or marketing materials as amended,
supplemented or otherwise updated from time to time; (iii) compliance
with the Subadviser's Code of Ethics pursuant to Rule 17j-1; and (iv)
such compliance certifications as may be reasonably requested;
(d) Promptly after filing with the SEC an amendment to its Form ADV, a copy
of such amendment to the Adviser and the Trustees;
17
(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 1940
Act or otherwise;
(g) Provide reasonable assistance in the valuation of securities including
the participation of appropriate representatives at fair valuation
committee meetings; and
(h) Supply the Fund's independent accountants, PricewaterhouseCoopers LLP,
or any successor accountant for the Fund, any information that it may
reasonably request in connection with the Fund.
18
SCHEDULE E
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FORM OF SUB-CERTIFICATION
To:
Re: Form N-CSR and Form N-Q Certification for the [Name of Designated Series].
From: [Name of Subadviser]
Representations in support of Investment Company Act Rule 30b1-5
certifications of Form N-CSR and Form N-Q.
[Name of Designated Series]
In connection with your certification responsibility under Rule 30b1-5
and Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act of 2002, I have
reviewed the following information presented for the period ended [Date
of Reporting Period] (the "Reports") which forms part of the N-CSR or
N-Q, as applicable, for the [Trust.
Schedule of Investments (the "Reports")
Our organization has designed, implemented and maintained internal controls and
procedures, designed for the purpose of ensuring the accuracy and completeness
of relevant portfolio trade data transmitted to those responsible for the
preparation of the Schedule of Investments. As of the date of this certification
there have been no material modifications to these internal controls and
procedures.
In addition, our organization has:
a. Designed such internal controls and procedures to ensure that material
information is made known to the appropriate groups responsible for
servicing the above-mentioned mutual funds.
b. Evaluated the effectiveness of our internal controls and procedures, as
of a date within 90 days prior to the date of this certification and we
have concluded that such controls and procedures are effective.
c. In addition, to the best of my knowledge there has been no fraud,
whether, or not material, that involves our organization's management or
other employees who have a significant role in our organization's
control and procedures as they relate to our duties as subadviser to the
Trust.
I have read the draft of the Reports which I understand to be current as of
[Date of Reporting Period] and based on my knowledge, such drafts of the Reports
do not, with respect to the Trust, contain any untrue statement of a material
fact or omit to state a material fact necessary to make
19
the information contained therein, in light of the circumstances under which
such information is resented, not misleading with respect to the period covered
by such draft Reports.
I have disclosed, based on my most recent evaluation, to the Trust's Chief
Accounting Officer:
a. All significant changes, deficiencies and material weakness, if any, in
the design or operation of the Subadviser's internal controls and
procedures which could adversely affect the Adviser's ability to record,
process, summarize and report financial data with respect to the Trust
in a timely fashion;
b. Any fraud, whether or not material, that involves the Subadviser's
management or other procedures for financial reporting as they relate to
our duties as Subadviser to the Trust.
I certify that to the best of my knowledge:
a. The Subadviser's Portfolio Manager(s) has/have complied with the
restrictions and reporting requirements of the Code of Ethics (the
"Code"). The term Portfolio Manager is as defined in the Code.
b. The Subadviser has complied with the Prospectus and Statement of
Additional Information of the Trust and the Policies and Procedures of
the Trust as adopted by the Trust's Board of Trustees to the extent they
relate to our duties as Subadviser to the Trust.
c. I have no knowledge of any compliance violations except as disclosed in
writing to the Phoenix Compliance Department by me or by the
Subadviser's compliance administrator.
d. The Subadviser has complied with the rules and regulations of the 33 Act
and 40 Act, and such other regulations as may apply to the extent those
rules and regulations pertain to the responsibilities of the Subadviser
with respect to the Trust as outlined above.
This certification relates solely to the Trust named above and may not be relied
upon by any other fund or entity.
The Subadviser does not maintain the official books and records of the above
Trust. The Subadviser's records are based on its own portfolio management
system, a record-keeping system that is not intended to serve as the Trust's
official accounting system. The Subadviser is not responsible for the
preparation of the Reports.
------------------------------- --------------------------
[Name of Authorized Signature] Date
20
SCHEDULE F
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DESIGNATED SERIES
Phoenix Capital Growth Fund
21
