SUBADVISORY AGREEMENT
THE PHOENIX EDGE SERIES FUND
PHOENIX-LORD XXXXXX BOND-DEBENTURE SERIES
PHOENIX-LORD XXXXXX LARGE-CAP VALUE SERIES
PHOENIX-LORD XXXXXX MID-CAP VALUE SERIES
Lord, Xxxxxx & Co.
00 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
AGREEMENT made as of the 9th day of August, 2002 between Phoenix
Variable Advisors, Inc. (the "Advisor"), a corporation organized under the laws
the state of Delaware, and Lord, Xxxxxx & Co. (the "Subadvisor"), a partnership
organized under the laws of the State of New York.
WHEREAS, The Phoenix Edge Series Fund (the "Fund") is a diversified
open-end investment company of the series type registered under the Investment
Company Act of 1940, as amended, (the "1940 Act"); and
WHEREAS, the shares of the Fund may be offered in one or more separate
series, including the Phoenix-Lord Xxxxxx Bond-Debenture Series, the
Phoenix-Lord Xxxxxx Large-Cap Value Series and the Phoenix-Lord Xxxxxx Mid-Cap
Value Series; and
WHEREAS, the Advisor has entered into an Investment Advisory Agreement
("Advisory Agreement") with the Fund pursuant to which the Advisor acts as
investment advisor to the Fund on behalf of one or more separate series of the
Fund, including the Series; and
WHEREAS, pursuant to the Advisory Agreement, the Advisor renders
certain investment advisory services to the Fund on behalf of the Series,
including providing general oversight of the Series, and evaluating,
recommending and monitoring one or more registered investment advisors to serve
as subadvisor to the Series; and
WHEREAS, the Advisor desires, with the approval of the Trustees of the
Fund (the "Trustees"), to retain Subadvisor to furnish portfolio management
services for the Series; and
WHEREAS, the Subadvisor is willing to furnish such services on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, the Advisor and the Subadvisor agree as follows:
1. Employment as a Subadvisor. The Advisor, being duly authorized, hereby
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appoints the Subadvisor to serve as subadvisor with regard to the assets of
the Series (the "Assets"), subject to the terms and conditions set forth in
this Agreement.
2. Acceptance of Employment; Standard of Performance. The Subadvisor accepts
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such appointment to serve as subadvisor and agrees to use its best
professional judgment to make investment decisions and provide related
services for the Series in accordance with the terms and conditions set
forth in this Agreement. The parties acknowledge and agree that the
services of the Subadvisor hereunder are not deemed exclusive and that
accordingly, the Subadvisor may render services to others so long as those
services do not conflict in any material manner with the Subadvisor's
performance of its duties and obligations pursuant to this Agreement.
3. Services of Subadvisor. Subject to the general oversight of the Advisor and
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the Trustees, the Subadvisor shall manage all of the securities and other
assets of the Series entrusted to it under this Agreement, including the
purchase, retention, and disposition of assets, securities, and other
property, and shall carry out all of its duties and obligations under this
Agreement, according to the following terms and conditions:
(a) At all times in performing its duties and obligations under this
Agreement, the Subadvisor shall act in conformity with the following
requirements: (i) 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 amended or
supplemented from time to time, (collectively, the "Prospectus"), as such
Prospectus is furnished to Subadvisor by Advisor; (ii) any policies and
procedures applicable to Subadvisor as adopted by the Board of the Fund or
as set forth in the Fund's Agreement and Declaration of Trust, dated
February 18, 1986, establishing the Fund, as may be amended from time to
time ("Declaration of Trust"), as such policies and procedures are
furnished to Subadvisor by Advisor; (iii) the 1940 Act, the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), the Securities Act
of 1933, as amended, (the "1933 Act") and the Securities Exchange Act of
1934, as amended, (the "1934 Act") and the rules and regulations
thereunder; (iv) the Internal Revenue Code of 1986, as amended, (the
"Code") and the rules and regulations thereunder, including but not limited
to the requirements for adequate diversification under Section 817(h) of
the Code, for treatment by the Series as a regulated investment company
under sub-chapter M of the Code; (v) as requested by Advisor, furnish
information to Advisor for purposes of compliance with the distribution
requirements necessary for avoiding payment of any excise tax under Section
4982 of the Code; (vi) all other applicable federal and state laws, as each
may be amended from time to time; and (vii) and any resolutions as may be
duly adopted by the Trustees from time to time and any instructions and
procedures of the Advisor, and, in either case, furnished to the Subadvisor
(collectively, these requirements are referred to herein as the "Investment
Requirements").
(b) The Subadvisor shall furnish a continuous investment program and
shall determine what portfolio investments will be purchased, retained, or
sold by the Series in conformity with the Prospectus and other Investment
Requirements.
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(c) The Subadvisor shall effect all transactions and take all
actions to implement the investment objectives and policies of the Series
in accordance with this Agreement.
(d) The Subadvisor shall have full authority at all times with
respect to the portfolio management of the Assets, including, but not
limited to, the authority: (i) to give written or oral instructions to
various broker/dealers, banks or other agents and to bind and obligate the
Fund to and for the carrying out of contracts, arrangements, or
transactions which shall be entered into by the Subadvisor on the Fund's
behalf with or through such broker/dealers, banks or other agents; (ii) to
direct the purchase and sale of any securities; and (iii) to maintain such
uninvested cash balances in the Series as it shall deem reasonable and
appropriate without incurring any liability for the payment of interest
thereon.
(e) The Subadvisor shall not, without the Advisor's prior written
approval, effect any transaction or take any action that would cause the
Series at the time of the transaction or action to be out of compliance
with any of the Investment Requirements. The Subadvisor shall promptly
inform the Fund and the Advisor of developments materially affecting (or
reasonably expected to affect) the Series, and will, on its own initiative,
furnish the Fund and the Advisor from time to time with whatever
information the Subadvisor believes is appropriate for this purpose.
(f) The Subadvisor shall send or make available appropriate
representatives to/for regular or special meetings of the Fund as may be
reasonably requested from time to time by the Advisor.
(g) The Subadvisor shall, as mutually agreed upon by the parties,
provide assistance with and participate in the marketing of the Series,
including, without limitation, participating at meetings with pension fund
representatives, broker/dealers who have a sales agreement with Phoenix
Equity Planning Corporation, and other parties requested by the Advisor.
(h) The Subadvisor shall place all orders for the purchase or sale
of securities or other investments for the Series with brokers or dealers
selected by the Subadvisor, as more fully specified below in Section 6 of
this Agreement.
4. Transaction Procedures. All transactions for the purchase or sale of
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securities or other investments 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 pursuant to its agreement with the Fund (the
"Custodian Agreement"), of all cash and/or securities and/or other property
due to or from the Series. The Subadvisor shall not have possession or
custody of such cash and/or securities or any responsibility or liability
with respect to such custody, except as described herein. The Subadvisor
shall advise the Custodian and confirm in writing or by confirmed
electronic transmission to the Fund all investment
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orders for the Series placed by it with brokers and dealers at the time and
in the manner set forth in the Custodian Agreement and 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 Subadvisor. 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 Subadvisor
shall have no responsibility or liability with respect to custodial
arrangements or the acts, omissions or other conduct of the Custodian other
than arrangements, acts, omissions or other conduct arising in reliance on
instructions of the Subadvisor.
5. Recordkeeping and Reporting. The Subadvisor shall maintain the records and
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information required by Rule 31a-1 under the 1940 Act respecting its
activities with respect to the Series, including but not limited to
subsections (b)(1), (b)(2), (b)(5), (b)(6), (b)(7), (b)(8), (b)(9),
(b)(10), (b)(11) and (f) of the Rule, and such other records with respect
thereto relating to the services the Subadvisor provides under this
Agreement as may be required in the future by applicable SEC and other
applicable rules, and shall retain such information for such times and in
such manner as required by applicable rules, including but not limited to
Rule 31a-2 under the 1940 Act. The records maintained by the Subadvisor
hereunder shall be the property of the Fund and shall be surrendered
promptly upon request, provided, however, that Subadvisor may retain copies
of all such records.
6. Allocation of Brokerage. The Subadvisor shall have authority and discretion
to select brokers and dealers to execute transactions initiated by the
Subadvisor on behalf of the Series with regard to the Assets, and to select
the markets on or in which the transactions will be executed, subject to
the following limitations:
(a) The Subadvisor shall at all times seek "best-execution." In
determining best execution, the Subadvisor is authorized to consider in its
selection of brokers and dealers to execute portfolio transactions, not
only the available prices and rates of brokerage commissions, but also
other relevant factors which may include, without limitation: (i) the
execution capabilities of such brokers and dealers, (ii) research, custody
and other services provided by such brokers and dealers which the
Subadvisor believes will enhance its general portfolio management
capabilities, (iii) the size of the transaction, (iv) the difficulty of
execution, (v) the operational facilities of such brokers and dealers, (vi)
the risk to such a broker or dealer of positioning a block of securities,
and (vii) the overall quality of brokerage and research services provided
by such brokers and dealers.
(b) The Subadvisor shall at all times place orders for the sale and
purchase of securities in accordance with the brokerage policy of the
Series as set forth in the Prospectus and as the Advisor or the Trustees
may direct from time to time.
(c) In placing orders for the sale and purchase of Series securities
for the Fund, the Subadvisor's primary responsibility shall be to seek the
best execution of orders
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at the most favorable prices. However, this responsibility shall not
obligate the Subadvisor to solicit competitive bids for each transaction or
to seek the lowest available commission cost to the Fund, so long as the
Subadvisor reasonably believes that the broker or dealer selected by it can
be expected to provide "best execution" 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 1934 Act, provided by such broker or dealer to the
Subadvisor, viewed in terms of either that particular transaction or of the
Subadvisor's overall responsibilities with respect to its clients,
including the Fund, as to which the Subadvisor 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.
(d) Subject to the requirements of Subsections (a)-(d) of this
Section, the Advisor shall have the right to require that transactions
giving rise to brokerage commissions, in an amount to be agreed upon by the
Advisor and the Subadvisor, shall be executed by brokers and dealers that
provide brokerage or research services to the Fund or that will be of value
to the Fund in the management of its assets, which services may, but need
not, be of direct or exclusive benefit to the Series. In addition, subject
to Subsections (a)-(d) of this Section, the applicable Conduct Rules of the
National Association of Securities Dealers, Inc. and other applicable law,
the Fund shall have the right to request that transactions be executed by
brokers and dealers by or through whom sales of shares of the Fund are made
to the extend permitted by applicable law.
7. Expenses. During the term of this Agreement, the Subadvisor shall bear all
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expenses incurred by it in connection with providing its services
hereunder. Without limiting the foregoing, the parties acknowledge and
agree that the Subadvisor shall furnish at its own expense, or pay the
expenses of the Advisor, for the following items:
(a) Office facilities, including office space, furniture and
equipment utilized by the Subadvisor's employees in the fulfillment of its
duties and obligations under this Agreement;
(b) Personnel and services necessary to perform the functions
required to manage the investment and reinvestment of the Assets (including
those required for research, analysis, pricing, reporting, statistics, and
investment), and to fulfill the other duties and obligations of the
Subadvisor hereunder;
(c) Personnel as may be reasonably requested by the Advisor or the
Fund to serve without salaries for the Fund as officers or agents of the
Fund. Notwithstanding the foregoing, the Subadvisor need not provide
personnel to perform, or pay the expenses of the Advisor for, services
customarily performed for an open-end management investment company by its
national distributor, custodian, financial agent, transfer agent, auditors
and legal counsel; and
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(d) Compensation and expenses, if any, of the Trustees who are also
full-time employees of the Subadvisor.
8. Fees for Services. The compensation of the Subadvisor for its services
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under this Agreement shall be calculated and paid by the Advisor in
accordance with the attached Schedule B. Pursuant to the Investment
Advisory Agreement between the Fund and the Advisor, the Advisor shall be
solely responsible for the payment of fees to the Subadvisor.
9. Limitation of Liability. The Subadvisor shall not be liable for any action
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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 Fund, so long
as such acts or omissions shall not have constituted a breach of the
investment objectives, policies and restrictions applicable to the Series,
as most recently furnished to Subadvisor by Advisor, and such acts or
omissions shall not have resulted from the Subadvisor's willful
misfeasance, bad faith, reckless disregard or gross negligence, a violation
of the standard of care established by and applicable to the Subadvisor in
its actions under this Agreement or a breach of its duty or of its
obligations hereunder (provided further, however, that the foregoing shall
not be construed to protect the Subadvisor from liability under the 1940
Act, other federal or state securities laws or common law).
10. Indemnification.
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(a) The Advisor agrees to indemnify and hold harmless the
Subadvisor, its officers and directors, and any person who "controls" the
Subadvisor, 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) suffered by Subadvisor resulting
from (i) the Advisor's breach of any provision of this Agreement, (ii)
willful misfeasance, bad faith, reckless disregard or gross negligence on
the part of the Advisor or any of its officers, directors or employees in
the performance of the Advisor's duties and obligations under this
Agreement or (iii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus relating to the 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 and in strict
conformity with written information furnished by the Subadvisor or any
affiliated person of the Subadvisor, expressly for use in the Fund's
registration statement or other than upon verbal information confirmed by
the Subadvisor in writing expressly for use in the Fund's registration
statement.
In no case shall the Advisor's indemnity in favor of the Subadvisor or any
affiliated person or controlling person of the Subadvisor, 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.
(b) The Subadvisor agrees to indemnify and hold harmless the
Advisor, its officers and directors, and any person who "controls" the
Advisor, 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) suffered by Advisor resulting from (i) the
Subadvisor's breach of its duties under this Agreement, (ii) willful
misfeasance, bad faith, reckless disregard or gross negligence on the part
of the Subadvisor or any of its officers, directors or employees in the
performance of the Subadvisor's duties and obligations under this Agreement
or (iii) any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus relating to the 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 and in strict conformity with written information
furnished by the Subadvisor to the Advisor, the Fund or any affiliated
person of the Advisor or the Fund expressly for use in the Fund's
registration statement, or upon verbal information confirmed by the
Subadvisor in writing expressly for use in the Fund's registration
statement, or to the extent of, and as a result of, the failure of the
Subadvisor to execute, or cause to be executed, portfolio transactions
according to the standards and requirements of the 1934 Act, the 1940 Act
and the Advisers Act.
In no case shall the Subadvisor's indemnity in favor of the Advisor or any
affiliated person or controlling person of the Advisor, 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.
11. Insurance. The Subadvisor shall, during the term of this Agreement, at its
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own expense, maintain adequate liability and errors and omissions insurance
coverage as may be reasonably agreed upon by the parties.
12. No Personal Liability. Reference is hereby made to the Declaration of
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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 or hereafter so filed with the
Secretary of the Commonwealth of Massachusetts and elsewhere as required by
law. 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 Fund shall be held to any
personal liability in connection with the affairs of the Fund; only the
Fund estate under said Declaration of Fund is liable. Without limiting the
generality of the foregoing, neither the Subadvisor nor any of its
officers, directors, partners, shareholders or employees shall, under any
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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 Fund estate.
13. Confidentiality. Subject to the duty of the Advisor or Subadvisor to comply
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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 Subadvisor and the Fund in respect thereof. It is understood that any
information or recommendation supplied by the Subadvisor in connection with
the performance of its obligations hereunder is to be regarded as
confidential and for use only by the Advisor, the Fund or such persons as
the Advisor may designate in connection with the Series. It is also
understood that any information supplied to the Subadvisor in connection
with the performance of its obligations hereunder, particularly, but not
limited to, any list of investments which, on a temporary basis, may not be
bought or sold for the Series, is to be regarded as confidential and for
use only by the Subadvisor in connection with its obligation to provide
investment advice and other services to the Series. The parties acknowledge
and agree that all nonpublic personal information with regard to
shareholders in the Series shall be deemed proprietary information of the
Advisor, and that the Subadvisor shall use that information solely in the
performance of its duties and obligations under this Agreement and shall
takes reasonable steps to safeguard the confidentiality of that
information. Further, the Subadvisor 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.
14. Assignment. This Agreement shall terminate automatically in the event of
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its "assignment," as that term is defined in Section 2(a)(4) of the 1940
Act. The Subadvisor shall provide the Advisor with prompt written notice of
any change of "control," as defined in Section 2(a)(9) of the 1940 Act, as
will enable the Advisor to consider whether an assignment as defined in
Section 2(a)(4) of the 1940 Act will occur and to take the steps it deems
necessary. The Subadvisor shall bear the reasonable costs associated with
any proxy solicitation required as a result of a change of control of the
Subadvisor. In addition, in the event that a change of control of the
Subadvisor necessitates the updating of prospectuses and marketing
materials for the Series, Subadvisor and Advisor agree to negotiate in good
faith the allocation of such costs. The understandings and obligations set
forth in this Section shall survive the termination of this Agreement and
shall be binding upon the Subadvisor and its successors.
15. Representations, Warranties and Agreements of the Subadvisor. The
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Subadvisor represents, warrants and agrees that:
(a) It is registered as an "investment advisor" under the Advisers
Act and will maintain such status so long as this Agreement remains in
effect.
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(b) It shall comply with any other applicable federal or state
requirements, and the applicable requirements of any regulatory or
self-regulatory agency, necessary to be met for its performance of the
services contemplated by this Agreement so long as this Agreement remains
in effect.
(c) It is not prohibited by the 1940 Act, the Advisers Act or other
applicable federal or state law from performing the services contemplated
by this Agreement.
(d) It is duly organized and validly existing under the laws of the
state in which it was organized with the power to own and posses its assets
and carry on its business as it is now being conducted.
(e) It has the power and has taken all necessary action, and has
obtained all necessary licenses, authorizations and approvals, to execute
this Agreement, which Agreement constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms, to enter into and
perform the services contemplated by this Agreement; and the execution,
delivery and performance by it of this Agreement does not contravene or
constitute a default under any agreement binding upon it.
(f) It will promptly notify the Advisor of the occurrence of any
event that would disqualify it from serving as an investment advisor of an
investment company pursuant to Section 9(a) of the 1940 Act or otherwise.
(g) It has a written code of ethics complying with the requirements
of Rule 17j-l under the 1940 Act and will provide the Advisor with a copy
of the code of ethics and evidence of its adoption. The Subadvisor
acknowledges receipt of the written code of ethics adopted by and on behalf
of the Fund (the "Code of Ethics"). It will not be subject to the Code of
Ethics during the term of this Agreement so long as its code of ethics
complies with applicable regulatory requirements and has been approved by
the Trustees. Within 20 days of the end of each calendar quarter while this
Agreement is in effect, a duly authorized compliance officer of the
Subadvisor shall certify to the Fund and to the Advisor that the Subadvisor
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, as the case may be, or if such a violation
has occurred, that appropriate action was taken in response to such
violation. The Subadvisor shall permit the Fund and Advisor to examine the
reports required to be made by the Subadvisor under Rule 17j-l(c)(1) and
all other records relevant to the Subadvisor's code of ethics as may be
reasonably requested by the Advisor or Trustees from time to time.
(h) It will manage the Series so that it will satisfy the
diversification requirements of Section 817(h), it will qualify for
treatment as a regulated investment company under Subchapter M of the Code,
it will, as requested by Advisor, furnish information to Advisor for
purposes of compliance with the distribution requirements necessary to
avoid payment of any excise tax pursuant to Section 4982 of the Code, and
9
the rules and regulations adopted under each such provision, based on
instructions to Subadvisor by Advisor.
(i) It has furnished a true and complete copy of its registration
statement as filed with the Securities and Exchange Commission (the
"Commission") on Form ADV to the Advisor and will furnish promptly such
updated copies of its registration statement or amendments thereto as are
filed with the Commission from time to time.
(j) It will furnish to the Advisor true and complete copies of
reports or other documents as may be reasonably requested by the Advisor in
connection with the performance of the Subadvisor's duties and obligations
under this Agreement.
(k) It will be responsible for the preparation and filing of
Schedule 13G and Form 13F on behalf of the Subadvisor with respect to the
Series in accordance with the requirements thereunder.
(l) It will furnish or otherwise make available to the Advisor such
other information relating to the business affairs of the Subadvisor or the
management of the Series as the Advisor at any time, or from time to time,
reasonably requests in connection with the Advisor's or Subadvisor's
performance of its respective obligations hereunder.
16. Representations, Warranties and Agreements of the Advisor. The Advisor
represents, warrants and agrees that:
(a) It is registered as an "investment advisor" under the Advisers
Act.
(b) It shall continue to meet any other applicable federal or state
requirements, or the applicable requirements of any regulatory or
self-regulatory agency, necessary to be met for its performance of the
services contemplated by this Agreement so long as this Agreement remains
in effect.
(c) It is not prohibited by the 1940 Act, the Advisers Act or other
applicable federal or state law from performing the services contemplated
by this Agreement.
(d) It is duly organized and validly existing under the laws of the
State in which it was organized with the power to own and posses its assets
and carry on its business as it is now being conducted.
(e) It has the power and has taken all necessary action, and has
obtained all necessary licenses, authorizations and approvals, to execute
this Agreement, which Agreement constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms, to enter into and
perform the services contemplated by this Agreement; and the execution,
delivery and performance by it of this Agreement does not contravene or
constitute a default under any agreement binding upon it.
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(f) It has delivered, or will before the effective date of this
Agreement deliver, to the Subadvisor true and complete copies of (i) the
Prospectus, (ii) the Declaration of Fund, and (iii) such other documents or
instruments governing the investments and investment policies and practices
of the Series applicable to the Subadvisor's duties and obligations
hereunder, and during the term of this Agreement will promptly deliver to
the Subadvisor true and complete copies of all documents and instruments
supplementing, amending, or otherwise becoming such documents or
instruments before or at the time they become effective.
(g) It will furnish or otherwise make available to the Subadvisor
such other information relating to the business affairs of the Fund as the
Subadvisor at any time, or from time to time, reasonably requests in order
to discharge its obligations hereunder.
17. Reports. The Subadvisor shall provide the Advisor and the Trustees such
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periodic and special reports as the Advisor may reasonably request. The
Subadvisor agrees that such records are the property of the Fund, and
subject to Section 13 hereof, shall be made reasonably available for
inspections by the Fund or by the Advisor as agent of the Fund, and
promptly upon request surrendered to either. Without limiting the
generality of the foregoing, the parties agree and acknowledge that the
Subadvisor shall provide the following items:
(a) Quarterly reports, in form and substance acceptable to the
Advisor, including but not limited to reports with respect to: (i)
compliance with the Subadvisor's code of ethics; (ii) compliance with
procedures adopted from time to time by the Trustees relative to securities
eligible for resale pursuant to Rule 144A under the 1933 Act; (iii)
diversification of Series assets in accordance with the then governing laws
and prevailing Prospectus pertaining to the Series; (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 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 1934 Act; (vii) any and all other reports reasonably requested
in accordance with or described in this Agreement; and, (viii) the
implementation of the Series investment program, including, without
limitation, analyses of Series performance;
(b) Annual or other periodic reports, in form and substance
acceptable to the Advisor, including but not limited reports with respect
to: (i) analyses of Series performance; (ii) disclosure related to the
portfolio management of the Series and the Subadvisor as may be contained
in the Prospectus or marketing materials as amended, supplemented or
otherwise updated from time to time; and (iii) compliance with the
Subadvisor's code of ethics pursuant to Rule 17j-1; and (iv) such
compliance certifications as may be reasonably requested.
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(c) The parties acknowledge and agree that the Subadvisor is
authorized to supply the Fund's independent accountants,
PricewaterhouseCoopers LLP, or any successor accountant for the Fund, any
information that they may reasonably request in connection with the Fund.
In addition, the Subadvisor shall immediately notify and forward to the
Advisor any legal process served upon it on behalf of the Advisor or the
Fund. The Subadvisor shall promptly notify the Advisor of any changes in
any information concerning the Subadvisor of which the Subadvisor becomes
aware that is or would be required to be disclosed in the Fund's
registration statement.
18. Proxies. The Subadvisor shall review all proxy solicitation materials and
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be responsible for voting and handling all proxies in relation to
the Assets. Subadvisor will vote all proxies in accordance with the
Subadvisor's proxy voting procedures, a copy of which will be provided by
Subadvisor to Advisor upon request. The Advisor shall cause the Custodian
to forward promptly to the Subadvisor all proxies upon receipt, so as to
afford the Subadvisor a reasonable amount of time in which to determine how
to vote such proxies. The Subadvisor agrees to provide the Advisor with
quarterly proxy voting reports in such form as the Advisor and Subadvisor
may reasonably agree from time to time. Subadvisor shall promptly notify
Advisor of any material modifications to proxy voting procedures.
19. Valuation of Assets and Related Recordkeeping. The Subadvisor shall assist
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the recordkeeping agent for the Fund in determining or confirming the value
of any securities or other assets in the Series for which the recordkeeping
agent seeks assistance from or identifies for review by the Advisor.
20. Amendment. This Agreement may be amended at any time, but only by written
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agreement between the Subadvisor and the Advisor, which amendment, other
than amendments to Schedule A, is subject to the approval of the Trustees
and the Shareholders of the Fund as and to the extent required by the 1940
Act.
21. Effective Date; Term. This Agreement shall become effective on the date set
--------------------
forth on the first page of this Agreement. Unless terminated as hereinafter
provided, this Agreement shall remain in full force and effect until
December 31, 2003, and thereafter only so long as its continuance has been
specifically approved at least annually in accordance with Sections 15(a)
and (c) of the 1940 Act and the Rules promulgated thereunder.
22. Notices. Except as otherwise provided in this Agreement, all notices or
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other communications required of permitted to be given hereunder shall be
in writing and shall be delivered or sent by (i) confirmed facsimile, (ii)
registered, certified or overnight mail, or (iii) a nationally recognized
overnight courier, to the following addresses or to such other address as
the relevant addressee shall hereafter notify for such purpose to the other
by notice in writing and shall be deemed to have been given at the time of
delivery.
12
If to the Advisor: PHOENIX VARIABLE ADVISORS, INC.
One American Row
Hartford, Connecticut
Attention: Xxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
If to the Subadvisor: LORD, XXXXXX & CO.
00 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
Attention: General Counsel
Facsimile: (000) 000-0000
23. Termination. This Agreement shall terminate immediately in the event of its
-----------
assignment, as specified above in Section 14 of this Agreement. This
Agreement may be terminated by either party, without penalty, immediately
upon written notice to the other party in the event of a breach of any
provision thereof by the party so notified, or otherwise, by the Advisor,
Subadvisor, Board of Trustees of the Fund or vote of a majority of the
outstanding voting securities of the Series upon sixty (60) days' written
notice to the other party. Notwithstanding such termination, any liability
of a party to any other party under this Agreement shall survive and remain
in full force and effect with respect to any claim or matter on which any
party has given written notice to any other party prior to termination and
until such liability has been finally settled.
24. Use of Subadvisor's Name. Subadvisor hereby grants to the Fund and Advisor
------------------------
a non-exclusive, royalty-free, worldwide license to use the Subadvisor's
name and logo in any and all promotional materials, prospectuses and
registration statements during the term of this Agreement.
25. 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, without giving effect to the conflicts of
laws principles thereof.
26. 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.
27. Entire Agreement. This Agreement embodies the entire agreement and
----------------
understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to the subject matter of this
Agreement.
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28. Counterparts. This Agreement may be executed in two or more counterparts,
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each of which shall be deemed an original, and all such counterparts shall
constitute a single instrument.
PHOENIX VARIABLE ADVISORS, INC.
By: /s/ Xxxxxx X. Xxxxxx
--------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
ACCEPTED:
LORD, XXXXXX & CO.
By: /s/ Xxxxxxxx X. Xxxxxx
----------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Partner
SCHEDULES: A. Operational Procedures
B. Fee Schedule
14
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 & Trust Company (the
"Custodian"), the custodian for the Fund.
The Subadvisor must furnish the Custodian with daily information as to executed
trades, or, if no trades are executed, with a report to that effect, no later
than 7:30 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. Security identifier (e.g., CUSIP), if applicable;
4. Number of shares and sales price per share;
5. Executing broker;
6. Settlement instructions for foreign trades; clearing and executing
broker for domestic trades.;
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. Currency for foreign trades;
15. Ticker symbol for domestic trades; and
16. Identified tax lot (if applicable).
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. Delivery instructions are as specified by the Custodian. The
Custodian and sub-accounting agent will supply the Subadvisor daily with a cash
availability report, which shall include cash detail and pending trades. This
will normally be done by confirmed facsimile or confirmed electronic
transmission so that the Subadvisor will know the amount available for
investment purposes.
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SCHEDULE B
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SUBADVISORY FEE
For services provided, the facilities furnished, and the expenses incurred by
the Subadvisor in connection with providing the Services pursuant to this
Agreement, the Advisor will pay to the Subadvisor, on or before the 10th day of
each month, a fee, payable in arrears, at the annual rate of:
Fee Rate (on all assets)
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Series Fee
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Phoenix-Lord Xxxxxx Bond-Debenture Series 0.35% up to $250 million
0.30% $250 million to $1 billion
0.25% in excess of $1 billion
Phoenix-Lord Xxxxxx Large-Cap Series 0.35% up to $600 million
0.30% $600 million to $1.2 billion
0.25% in excess of $1.2 billion
Phoenix-Lord Xxxxxx Mid-Cap Value Series 0.40%
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
Subadvisor, 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.
16
