EXHIBIT 5.13
SUB-INVESTMENT ADVISORY AGREEMENT
SUB-INVESTMENT ADVISORY AGREEMENT
This Sub-Investment Advisory Agreement (this "Agreement") is entered
into as of December 15, 1999, by and between Phoenix Variable Advisors, a
Delaware corporation ("Investment Manager") and Janus Capital Corporation, a
Colorado corporation ("JCC").
RECITALS
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a. Investment Manager has entered into an Investment Management
Agreement dated December 15,1999 (the "Investment Management Agreement") with
The Phoenix Edge Series Fund (the "Fund"), to act as investment manager to the
Phoenix-Janus Equity-Income Series, the Phoenix-Janus Flex Income Series and the
Phoenix-Janus Growth Series, which are series of the Fund (collectively the
"Portfolios").
b. The Investment Management Agreement provides that Investment Manager
may engage a sub-investment adviser to furnish investment information and advice
to assist Investment Manager in carrying out its responsibilities under the
Investment Management Agreement.
c. Investment Manager and the Trustees of the Fund desire to retain JCC
to render investment management services to Investment Manager in the manner and
on the terms set forth in this Agreement.
AGREEMENT
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In consideration of the mutual covenants and agreements set forth in
this Agreement, Investment Manager and JCC agree as follows:
1. Sub-Investment Adviser Services.
(a) JCC shall, subject to the control of the Trustees of the
Fund and to the supervision of Investment Manager, have exclusive authority to
manage the investment and reinvestment of the assets of the Portfolios,
including cash, provided that such management is in accordance with the Fund's
declaration of trust and in its registration statements under the Investment
Company Act of 1940 (the "1940 Act"), Investment Manager acknowledges that JCC
has authority to trade every day the market is open. JCC makes no representation
or warranty, express or implied, that any level of performance or investment
results will be achieved by the Portfolios or that the Portfolios will perform
comparably with any standard or index, including other clients of JCC, whether
public or private.
(b) Subject to the understanding that JCC shall not be
responsible for portfolio accounting and shall not be required to generate
information derived from portfolio accounting data or to disclose proprietary
information, JCC shall furnish Investment Manager with quarterly reports, in
form and substance acceptable to the Investment Manager, with respect to:
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(i) compliance with JCC's code of ethics;
(ii) compliance with procedures adopted from time to
time by the Trustees of the Fund relative to
securities eligible for resale under Rule 144A
under the Securities Act of 1933, as amended;
(iii) diversification of Portfolio assets in accordance
with the then prevailing prospectus and statement
of additional information pertaining to the
Portfolios and governing laws;
(iv) the implementation of the Portfolios' investment
program, including, without limitation, analysis of
Portfolio performance; and
(v) any other reports reasonably requested in
accordance with or described in this Agreement.
(c) Upon prior notice, JCC shall permit the financial
statements, books and records with respect to the Portfolios to be inspected and
audited by Investment Manager (and/or the independent accountants for Investment
Manager or the Fund) at all reasonable times during normal business hours. JCC
agrees that such records are the property of the Fund, and shall be made
reasonably available for inspections, and by the Fund or to the Investment
Manager as agent of the Fund, and promptly upon request surrendered to either.
(d) JCC has provided to Investment Manager a copy of JCC's
Form ADV as filed with the Securities and Exchange Commission. JCC shall provide
to Investment Manager a list of persons who JCC wishes to have authorized to
give written and/or oral instructions to Custodians of Fund assets for the
Portfolios.
(e) JCC shall be responsible for the preparation and filing of
Schedule 13G and Form 13F on behalf of the Portfolios. JCC shall not be
responsible for the preparation or filing of any reports required of the
Portfolios by any governmental or regulatory agency, except as expressly agreed
to in writing. JCC will cooperate (establishing proxy handling procedures
acceptable to Investment Manager) with such authorized representative of the
Fund granted authority to vote proxies solicited by or with respect to the
issuers of securities in which Fund assets are invested.
(f) JCC shall have no responsibility to monitor certain
limitations or restrictions, including without limitation, the 90%-source test,
for which JCC determines it has not been provided sufficient information in
accordance with Section 2 of this Agreement or otherwise. All such monitoring
shall be the responsibility of Investment Manager.
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(g) JCC accepts its appointment as a sub-investment adviser
and agrees to provide an investment program for the Portfolios consistent with
their investment objectives based upon the development, review and adjustment of
investment policies approved from time to time by the Board of Trustees and
Investment Manager in consultation with JCC. In managing the Portfolios JCC
agrees to use its best professional judgment to make investment decisions for
the Portfolios in accordance with the provisions of this Agreement.
(h) JCC agrees to attendance by appropriate representatives of
the Investment Manager at meetings requested by the Investment Manager or
Trustees at such time(s) and location(s) as reasonably requested by the
Investment Manager or Trustees. JCC also agrees to participation, overall
assistance and support in marketing the Portfolios, including, without
limitation, meetings with pension fund representatives, broker/dealers who have
a sales agreement with Phoenix Equity Planning Corporation, and other parties
requested by the Investment Manager.
(i) JCC will assist the recordkeeping agent for the Fund in
determining or confirming the value of any securities or other assets in the
Portfolios for which the recordkeeping agent seeks assistance from or identifies
for review by JCC. The parties agree that, consistent with applicable law, JCC
will not bear responsibility for the determination of value of any such
securities or other assets.
2. Obligations of Investment Manager and the Portfolio.
(a) Investment Manager has provided to JCC the information and
documents listed on the attached Exhibit A. Throughout the term of this
Agreement, Investment Manager shall continue to provide such information and
documents to JCC, including any amendments, updates or supplements to such
information or documents, before or at the time the amendments, updates or
supplements become effective. Investment Manager shall timely furnish JCC with
such additional information as may be reasonably necessary for or requested by
JCC to perform its responsibilities pursuant to this Agreement.
(b) Investment Manager shall be responsible for setting up and
maintaining brokerage accounts and other accounts JCC deems advisable to allow
for the purchase or sale of various forms of securities pursuant to this
Agreement.
(c) Investment Manager will deliver to JCC any limitations
imposed upon the Fund as a result of relevant diversification requirements under
the provisions of Section 817(h) of the Internal Revenue Code of 1986, as
amended.
3. Custodian. The Portfolio assets shall be maintained in the
custody of the custodian identified pursuant to Exhibit A. Any assets added to
the Portfolios shall be delivered directly to such custodian. JCC shall have no
liability for the acts or omissions of any custodian of the Portfolio's assets.
JCC shall have no responsibility for the segregation requirement of the 1940 Act
or other applicable law.
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4. Broker Dealers. Absent written instructions from Investment
Manager to the contrary, JCC shall place all orders for the purchase and sale of
investment instruments for the Portfolio with brokers or dealers selected by
JCC, which may include brokers or dealers affiliated with JCC. Purchase or sell
orders for a Portfolio may be aggregated with contemporaneous purchase or sell
orders of other clients of JCC. JCC shall use its best efforts to obtain
execution of Portfolio transaction at prices that are advantageous to the
Portfolios and at commission rates that are reasonable in relation to the
benefits received. However, JCC may select brokers or dealers on the basis that
they provide brokerage, research, or other services or products to a Portfolio
and/or other accounts serviced by JCC. JCC may place portfolio transactions with
a broker or dealer with whom it has negotiated a commission in excess of the
commission another broker or dealer would have charged for effecting that
transaction if JCC determines in good faith that such amount of commission was
reasonable in relation to the value of the brokerage and research provided by
such broker or dealer, viewed in terms of either that particular transaction or
the overall responsibilities that JCC and its affiliates have with respect to
the Portfolio and to accounts over which they exercise investment discretion,
and not all such services or products will necessarily be used by JCC in
managing the Portfolios. In addition, consistent with best execution, JCC may
execute Portfolio transactions through brokers and dealers that sell shares of
mutual funds advised by JCC or recommend to their customers that they purchase
shares of such funds. If JCC determines that any product or service furnished by
a broker has a mixed use, such that it also serves functions that do not assist
in the investment decision-making process, JCC may allocate the costs of such
service or product accordingly. The portion of the product or service that JCC
determines will assist it in the investment decision-making process may be paid
for in brokerage commission dollars. This allocation may create a conflict of
interest for JCC.
5. Fees. Investment Manager shall pay to JCC a monthly fee in
accordance with the attached Exhibit B. Investment Manager shall calculate the
fee for each month during which JCC provides investment management services
based upon the average daily net assets of the Portfolios (including cash or
cash equivalents) for each such month. The fee shall be payable to JCC by the
fifteenth day of each month. The fee for the first month during which JCC
provides investment management services shall be based upon the number of days
the account was open in that month. Similarly, if this Agreement is terminated,
the fee shall be based upon the number of days the account was open during the
month in which the Agreement is terminated.
6. Expenses. Investment Manager, the Fund and the Portfolios
shall assume and pay their respective organizational, operational, and business
expenses not specifically assumed or agreed to be paid by JCC pursuant to this
Agreement. JCC shall pay its own organizational, operational, and business
expenses but shall not be obligated to pay any expenses of Investment Manager,
the Fund, or the Portfolios, including without limitation: (a) interest and
taxes; (b) brokerage commissions and other costs in connection with the purchase
or sale of securities or other investment instruments for the Portfolios; and
(c) custodian fees and expenses. Any reimbursement of management fees required
by any expense limitation provision and any liability arising out of a violation
of Section 36(b) of the 1940 Act shall be the sole responsibility of Investment
Manager.
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7. Representations and Warranties.
(a) Investment Manager represents and warrants the following:
(i) Investment Manager has been duly incorporated and
is validly existing and in good standing as a
corporation under the laws of the state of
Deleware.
(ii) Investment Manager has all requisite corporate
power and authority under the laws of Delaware and
federal securities laws to execute, deliver and to
perform this Agreement.
(iii) All necessary corporate proceedings of Investment
Manager have been duly taken to authorize the
execution, delivery and performance of this
Agreement by Investment Manager.
(iv) Investment Manager is a registered investment
adviser under the Investment Advisers Act of 1940
and is in compliance with all other registrations
required.
(v) Investment Manager has complied, in all material
respects, with all registrations required by, and
will comply, in all material respects, with all
applicable rules and regulations of, the
Securities and Exchange Commission.
(vi) Investment Manager has authority under the
Investment Management Agreement to execute,
deliver and perform this Agreement.
(vii) Investment Manager has received a copy of Part II
of JCC's Form ADV.
(b) JCC represents and warrants the following:
(i) JCC has been duly incorporated and is validly
existing and in good standing as a corporation
under the laws of the state of Colorado.
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(ii) JCC has all requisite corporate power and
authority under the laws of Colorado and federal
securities laws to execute, deliver and to perform
this Agreement.
(iii) All necessary corporate proceedings of JCC have
been duly taken to authorize the execution,
delivery and performance of this Agreement by JCC.
(iv) JCC is a registered investment adviser under the
Investment Advisers Act of 1940 and is in
compliance with all other registrations required.
(v) JCC has complied, in all material respects, with
all registrations required by, and will comply, in
all material respects, with all applicable rules
and regulations, of the Securities and Exchange
Commission.
8. Confidentiality and Proprietary Rights. Investment Manager
will not, directly or indirectly, and will not permit its affiliates employees,
officers, directors, agents, contractors, or the Portfolios to, in any form or
by any means, use, disclose, or furnish, to any person or entity, records or
information concerning the business of JCC, except as necessary for the
performance of its duties under this Agreement or the Investment Management
Agreement, or as required by law upon prior written notice to JCC. JCC is the
sole owner of the name and xxxx "Xxxxx." Investment Manager shall not, and shall
not permit the Portfolio to, without prior written consent of JCC, use the name
or xxxx "Janus" or make representations regarding JCC or its affiliates. Upon
termination of this Agreement for any reason, Investment Manager shall
immediately cease, and Investment Manager shall cause the Portfolios to
immediately cease, all use of the Janus name or any Xxxxx xxxx.
9. Non-Exclusivity.
(a) JCC, its affiliates, or any of their directors, officers,
employees, or agents may buy, sell, or trade any securities or other investment
instruments for their own account or for the account of others for whom it or
they may be acting, provided that such activities will not adversely affect or
otherwise impair the performance by JCC of its responsibilities under this
Agreement. JCC and its affiliates may act as investment manager to or provide
other services with respect to various investment companies and other managed
accounts, which advice or services, including the nature of such services, may
differ from or be identical to advice given or action taken with respect to the
Portfolios. In the event of such activities, the transactions and associated
costs will be allocated among such clients (including the Portfolios) in a
manner that JCC believes to be equitable to the accounts involved and consistent
with such accounts' objectives, policies, and limitations.
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(b) JCC shall be subject to a written code of ethics adopted
by it pursuant to Rule 17j-1(b) of the 1940 Act, and shall not be subject to any
other code of ethics, including Investment Manager's code of ethics, unless
specifically adopted by JCC.
(c) JCC may provide advice to or take action with respect to
other clients, which advice or action, including the timing and nature of such
action, may differ from or be identical to advice given or action taken with
respect to the Portfolios. Except as necessary to perform this Agreement, JCC
shall be deemed to be an independent contractor and shall have no authority,
unless otherwise provided or authorized, to act for or represent the Portfolios
or Investment Manager in any way or otherwise be deemed an agent of the
Portfolios or Investment Manager. Investment Manager and JCC shall not be
considered as partners or participants in a joint venture.
10. Liability.
(a) Except as may otherwise be provided by the 1940 Act, or
other federal securities laws, neither JCC nor any of its affiliates, officers,
directors, officers, shareholders, employees, or agents shall be liable for any
loss, liability, cost, damage, or expense (including reasonable attorneys' fees
and costs) (collectively referred to in this Agreement as "Losses"), including
without limitation, Losses in connection with pricing information or other
information provided by JCC, except for Losses directly resulting from JCC's
gross negligence, bad faith, or willful misconduct. Investment Manager and the
Fund shall, jointly and severally, hold harmless and indemnify JCC, its
affiliates, directors, officers, shareholders, employees or agents for any Loss
not resulting from JCC's negligence or its breach of the terms of this
Agreement. The obligations contained in this Section 10 shall survive
termination of this Agreement.
(b) Reference is hereby made to the Declaration of Trust dated
February 18, 1986, establishing the Fund, 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 Phoenix Edge Series Fund refers to the Trustees under said
Declaration of Fund, 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 Trust is liable. Without limiting the
generality of the foregoing, neither FIC nor any of its officers, directors,
partners, shareholders or employees shall, under any circumstances, have
recourse or cause or willingly permit recourse to be had directly or indirectly
to any personal, statutory, or other liability of any shareholder, Trustee,
officer, agent or employee of the Fund or of any successor of the Fund, whether
such liability now exists or is hereafter incurred for claims against the trust
estate.
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11. Duration.
(a) This Agreement shall remain in full force and effect for
two years from the date it is entered into, and is then renewable annually upon
approval by (i) the majority of those members of the Fund's Trustees who are not
interested persons of the Fund, the Investment Manager, or JCC, cast in person
at a meeting called for the purpose of voting on such approval, and (ii) the
Fund's Trustees or vote of a majority of outstanding voting securities of the
applicable Portfolio; provided, however, that if this Agreement or the
continuation of this Agreement is not approved, JCC may continue to render
services under this Agreement in the manner and to the extent permitted by the
1940 Act and applicable regulations.
(b) This Agreement may be terminated as to a Portfolio at any
time, without penalty, by JCC, by the Fund's Trustees or by a majority of the
outstanding voting securities of the applicable Portfolio, on sixty days'
written notice to the other party. This Agreement will immediately terminate in
the event of its assignment. Investment Manager shall provide advance written
notice of any anticipated assignment. (As used in this Agreement, the terms
"majority of the outstanding voting securities," "interested persons," and
"assignment" have the same meaning as such terms have in the 1940 Act.)
12. Amendment. This Agreement may be amended at any time, but only
by written agreement between the Investment Manager and JCC, which amendment, is
subject to the approval of the Trustees and the Shareholders of the Fund as and
to the extent required by the 1940 Act.
13. General.
(a) This Agreement constitutes the entire understanding of the
parties with respect to its subject matter, shall supersede all prior
understandings agreements, contracts or other documents, and shall continue in
full force and effect until terminated.
(b) If any provision of this Agreement is held to be invalid
or unenforceable to any extent, the remainder of this Agreement shall be
enforced to the greatest extent permitted by law.
(c) This Agreement shall be governed by applicable federal law
and the laws of the State of Colorado without regard to choice of laws
principals. Investment Manager and the Fund consent to the venue of the Denver
District Court of the County of Denver, State of Colorado, or the United States
District Court for the District of Colorado and agree that all lawsuits arising
from this Agreement shall be conducted only in such courts, unless such courts
refuse to accept jurisdiction.
(d) This Agreement may be executed in two or more counterparts
which together shall constitute one document.
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(e) All notices or other communications required or permitted
to be given hereunder shall be in writing and shall be delivered or sent by
pre-paid first class letter post to the following addresses or to such other
address as the relevant addressee shall hereafter notify for such purpose to the
others by notice in writing and shall be deemed to have been given at the time
of delivery.
If to the Investment Manager:
Phoenix Variable Advisors
One American Row
Hartford, Connecticut
Attention: Xxxxxx Xxxxxx
If to JCC:
Janus Capital Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
PHOENIX VARIABLE ADVISORS
By:_______________________________
Name:___________________________
Title:__________________________
JANUS CAPITAL CORPORATION
By:_______________________________
Name:_________________________
Title:________________________
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EXHIBIT A
Information and documentation provided by Investment Manager:
[bullet] A copy of the Portfolios' registration statement.
[bullet] Copies of the Portfolios' prospectus and statement of additional
information.
[bullet] Copies of the Fund's organizational documents, Bylaws, and as
applicable to the Portfolio, minutes of meetings of the Trustees of the
Fund.
[bullet] Notice of the Portfolio's custodian designated to hold assets in the
Portfolios.
[bullet] A list of the countries approved by the Trustees in accordance with
Rule 17f-5 in which Portfolio assets may be maintained and a list of
those countries available immediately.
[bullet] Certified copies of financial statements or reports prepared for the
Fund, including the Portfolio, by certified or independent public
accountants.
[bullet] Copies of any financial statement or reports made by the Portfolio to
its shareholders or to any governmental body or securities exchange.
[bullet] Reports as to the composition of assets in the Fund, cash requirements
and cash available for investment in the Portfolios.
[bullet] Copies of Investment Manager's liquidity procedures, cross-trade
procedures, repurchase agreement procedures, 10f-3, 17a-7 and 17e-1
procedures and other procedures that may affect the duties of JCC.
[bullet] A Free-riding and Withholding Questionnaire completed by the Fund.
[bullet] An Internal Revenue Service Form W-9 completed by the Fund.
[bullet] A Qualified Institutional Investor Certification completed by the Fund.
[bullet] A list of persons authorized to act on behalf of the Portfolios.
[bullet] A list of "affiliates" of the Fund, as such term is used in the 1940
Act, including all broker-dealers affiliated with the Fund.
[bullet] Applicable Commodities Futures Trading Commission exemptions,
notifications and/or related documentation.
[bullet] A list of established futures accounts.
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EXHIBIT B
Fee Rate
(on all assets)
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Series Fee
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Phoenix-Janus Equity-Income Series 0.85%
Phoenix-Janus Flex Income Series 0.80%
Phoenix-Janus Growth Series 0.85%
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