EXHIBIT 5.2
Subadvisory Agreement
THE PHOENIX EDGE SERIES FUND
SUBADVISORY AGREEMENT
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May 1, 1995
ABKB/LaSalle Securities Limited Partnership
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
RE: SUBADVISORY AGREEMENT
Gentlemen:
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
(the "Act"), and is subject to the rules and regulations promulgated thereunder.
The shares of the Fund are offered in seven series, one of which is the Real
Estate Securities Series (the "Series").
Phoenix Realty Securities, Inc. (the "Adviser") evaluates and recommends series
advisers 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 ABKB/LaSalle Securities Limited Partnership (the "Subadviser") as
a discretionary series adviser to invest and reinvest the assets of the
Series on the terms and conditions set forth herein. The services of the
Subadviser hereunder are not to be deemed exclusive; the Subadviser may
render services to others and engage in other activities which do not
conflict in any material manner in the Subadviser's performance hereunder.
2. ACCEPTANCE OF EMPLOYMENT; STANDARD OF PERFORMANCE. The Subadviser accepts
its employment as a discretionary series adviser of the Series and agrees
to use its best professional judgment to make investment decisions for the
Series in accordance with the provisions of this Agreement and as set
forth in Schedule D attached hereto and made a part hereof.
3. SERVICES OF SUBADVISER. In providing management services to the Series,
the Subadviser shall be subject to the investment objectives, policies and
restrictions of the Fund as they apply to the Series and as set forth in
the Fund's then current Prospectus and Statement of Additional Information
(as the same may be modified from time to time and provided to the
Subadviser by Adviser), and to the investment restrictions set forth in
the Act and the Rules thereunder, to the supervision and control of the
Trustees of the Fund (the "Trustees"), and to instructions from the
Adviser. The Subadviser shall not, without the Fund's prior approval,
effect any transactions which would cause the Series to be out of
compliance with any of such restrictions or policies.
4. TRANSACTION PROCEDURES. All series transactions for the Series will be
consummated by payment to, or delivery by, State Street Bank & Trust
Company (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 Fund all investment orders for the Series placed
by it with brokers and
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dealers at the time and in the manner set forth in Schedule A hereto (as
amended from time to time). The Fund shall issue to the Custodian such
instructions as may be appropriate in connection with the settlement of
any transaction initiated by the Subadviser. The Fund shall be responsible
for all custodial arrangements and the payment of all custodial charges
and fees, and, upon giving proper instructions to the Custodian, the
Subadviser shall have no responsibility or liability with respect to
custodial arrangements or the act, omissions or other conduct of the
Custodian.
5. ALLOCATION OF BROKERAGE. The Subadviser shall have authority and
discretion to select brokers and dealers to execute series transactions
initiated by the Subadviser, and to select the markets on or in which the
transactions will be executed.
A. In placing orders for the sale and purchase of series securities
for the Fund, the Subadviser's primary responsibility shall be to seek the
best execution of orders at the most favorable prices. However, this
responsibility shall not obligate the Subadviser to solicit competitive
bids for each transaction or to seek the lowest available commission cost
to the Fund, so long as the Subadviser reasonably believes that the broker
or dealer selected by it can be expected to obtain a "best execution"
market price on the particular transaction and determines in good faith
that the commission cost is reasonable in relation to the value of the
brokerage and research services (as defined in Section 28(e)(3) of the
Securities Exchange Act of 1934) provided by such broker or dealer to the
Subadviser, viewed in terms of either that particular transaction or of
the Subadviser's overall responsibilities with respect to its clients,
including the Fund, as to which the Subadviser exercises investment
discretion, notwithstanding that the Fund may not be the direct or
exclusive beneficiary of any such services or that another broker may be
willing to charge the Fund a lower commission on the particular
transaction.
B. Subject to the requirements of paragraph A above, the Adviser
shall have the right to require that transactions giving rise to brokerage
commissions, in an amount to be agreed upon by the Adviser and the
Subadviser, 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 and relationship may,
but need not, be of direct benefit to the Series. In addition, subject to
paragraph A above and the applicable Rules of Fair Practice of the
National Association of Securities Dealers, Inc., the Fund shall have the
right to request that series transactions be executed by brokers and
dealers by or through whom sales of shares of the Fund are made.
C. The Subadviser shall not execute any series transactions for the
Series with a broker or dealer which is an "affiliated person" (as defined
in the Act) of the Fund, the Subadviser or the Adviser without the prior
written approval of the Fund. The Fund will provide the Subadviser with a
list of brokers and dealers which are "affiliated persons" of the Fund or
Adviser.
6. PROXIES. The Fund, or the Adviser as its authorized agent, will vote all
proxies solicited by or with respect to the issuers of securities in which
assets of the Series may be invested. At the request of the Fund, the
Subadviser shall provide the Fund with its recommendations as to the
voting of particular proxies.
7. 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
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Investment Advisory Agreement between the Fund and the Adviser, the
Adviser is responsible for the payment of fees to the Subadviser.
8. LIMITATION OF LIABILITY. The Subadviser shall not 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 Fund,
provided, however, that such acts or omissions shall not have constituted
a breach of the investment objectives, policies and restrictions
applicable to the Series and that such acts or omissions shall not have
resulted from the Subadviser's willful misfeasance, bad faith or gross
negligence, a violation of the standard of care established by and
applicable to the Subadviser in its actions under this Agreement or a
breach of its duty or of its obligations hereunder (provided, however,
that the foregoing shall not be construed to protect the Subadviser from
liability under the Act).
9. CONFIDENTIALITY. Subject to the duty of the Subadviser and the Fund to
comply with applicable law, including any demand of any regulatory or
taxing authority having jurisdiction, the parties hereto shall treat as
confidential all information pertaining to the Series and the actions of
the Subadviser and the Fund in respect thereof.
10. ASSIGNMENT. This Agreement shall terminate automatically in the event of
its assignment, as that term is defined in Section 2(a)(4) of the Act. The
Subadviser shall notify the Fund in writing sufficiently in advance of any
proposed change of control, as defined in Section 2(a)(9) of the Act, as
will enable the Fund to consider whether an assignment as defined in
Section 2(a)(4) of the Act will occur, and to take the steps necessary to
enter into a new contract with the Subadviser.
11. REPRESENTATIONS, Warranties and Agreements of the Subadviser. The
Subadviser represents, warrants and agrees that:
A. It is registered as an "Investment Adviser" under the Investment
Advisers Act of 1940 ("Advisers Act").
B. It will maintain, keep current and preserve on behalf of
the Fund, in the manner required or permitted by the Act and
the Rules thereunder, the records identified in Schedule B (as
Schedule B may be amended from time to time). The Subadviser
agrees that such records are the property of the Fund, and
will be surrendered to the Fund promptly upon request.
C. It has or shall adopt a written code of ethics complying
with the requirements of Rule 17j-l under the Act and will
provide the Fund with a copy of the code of ethics and
evidence of its adoption. Subadviser acknowledges receipt of
the written code of ethics adopted by and on behalf of the
Phoenix Funds (the "Phoenix Code of Ethics"). Within 10 days
of the end of each calendar quarter while this Agreement is in
effect, a duly authorized compliance officer of the Subadviser
shall certify to the Fund that the Subadviser has complied
with the requirements of Rule 17j-l during the previous
calendar quarter and that there has been no violation of its
code of ethics, or the Phoenix Code of Ethics, or if such a
violation has occurred, that appropriate action was taken in
response to such violation. The Subadviser
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shall permit the Fund to examine the reports required to be made by
the Subadviser under Rule 17j-l(c)(1) and this subparagraph.
D. Upon request, the Subadviser will promptly supply the Fund
with any information concerning the Subadviser and its
stockholders, employees and affiliates which the Fund may
reasonably require in connection with reports to the Fund's
Board of Trustees or the preparation of its registration
statement, proxy material, reports and other documents
required to be filed under the Act, the Securities Act of
1933, or under applicable securities laws.
E. Reference is hereby made to the Declaration of Trust dated
February 18, 1986, as amended, 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 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 Fund shall be held to any personal
liability hereunder or in connection with the affairs of the
Fund; only the trust estate under said Declaration of Trust is
liable under this Agreement. Without limiting the generality
of the foregoing, neither the Subadviser nor any of its
officers, directors, partners, shareholders or employees
shall, under any circumstances, have recourse or cause or
willingly permit recourse to be had directly or indirectly to
any personal, statutory, or other liability of any
shareholder, Trustee, officer, agent or employee of the Fund
or of any successor of the Fund, whether such liability now
exists or is hereafter incurred for claims against the trust
estate, but shall look for payment solely to said trust
estate, or to the assets of a successor of the Fund.
12. AMENDMENT. This Agreement may be amended at any time, but only by written
agreement among the Subadviser, the Adviser and the Fund, which amendment,
other than amendments to Schedules A, B, and D, is subject to the approval
of the Trustees and the Shareholders of the Fund as and to the extent
required by the Act.
13. 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 the first meeting of the shareholders of the Series, and, if
its renewal is approved at that meeting in the manner required by the Act,
shall continue in effect 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 Investment Company Act, and by the majority vote
of the disinterested Trustees in accordance with the requirements of
Section 15(c) thereof.
14. TERMINATION. This Agreement may be terminated by any party, without
penalty, immediately upon written notice to the other parties in the event
of a breach of any provision thereof by a party so notified, or otherwise
upon thirty (30) days' written notice to the other parties, but any such
termination shall not affect the status, obligations or liabilities of any
party hereto to the other parties.
15. 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.
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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.
THE PHOENIX EDGE SERIES FUND
By: _____________________________________
Title:
ABKB/LaSalle Securities
Page 6
THE PHOENIX REALTY SECURITIES, INC.
By: _____________________________________
Title:
ACCEPTED:
ABKB/LASALLE SECURITIES LIMITED PARTNERSHIP
By: _________________________________
Title: ______________________________
SCHEDULES: A. Operational Procedures
B. Record Keeping Requirements
C. Fee Schedule
D. Subadviser Functions
SCHEDULE A
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OPERATIONAL PROCEDURES
In order to minimize operational problems, it will be necessary for a flow of
information to be supplied to State Street Bank & Trust Company (the
"Custodian"), the custodian for the Fund.
The Subadviser 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 5 p.m. (Eastern Standard time) on the day of the trade (confirmation
received from broker). The necessary information can be sent via facsimile
machine to the Custodian. Information provided to the Custodian shall include
the following:
1. Purchase or sale;
2. Security name;
3. CUSIP number (if applicable);
4. Number of shares and sales price per share;
5. Executing broker;
6. Settlement agent;
7. Trade date;
8. Settlement date;
9. Aggregate commission or if a net trade;
10. Interest purchased or sold from interest bearing security;
11. Other fees;
12. Net proceeds of the transaction;
13. Exchange where trade was executed; and
14. 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 will supply the Subadviser daily with a cash availability report. This
will normally be done by telex so that the Subadviser will know the amount
available for investment purposes.
SCHEDULE B
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RECORDS TO BE MAINTAINED BY THE SUBADVISER
1. (Rule 31a-1(b)(5)) A record of each brokerage order, and all other
series purchases and sales, given by the Subadviser on behalf of the
Fund for, or in connection with, the purchase or sale of securities,
whether executed or unexecuted. Such records shall include:
A. The name of the broker;
B. The terms and conditions of the order and of any modifications or
cancellations thereof;
C. The time of entry or cancellation;
D. The price at which executed;
E. The time of receipt of a report of execution; and
F. The name of the person who placed the order on behalf of the Fund.
2. (Rule 31a-1(b)(9)) A record for each fiscal quarter, completed within
ten (10) days after the end of the quarter, showing specifically the
basis or bases upon which the allocation of orders for the purchase and
sale of series securities to named brokers or dealers was effected, and
the division of brokerage commissions or other compensation on such
purchase and sale orders. Such record:
A. Shall include the consideration given to:
(i) The sale of shares of the Fund by brokers or dealers.
(ii) The supplying of services or benefits by brokers or dealers to:
(a) The Fund,
(b) The Adviser (Phoenix Realty Securities, Inc.)
(c) The Subadviser, and
(d) Any person other than the foregoing.
(iii) Any other consideration other than the technical qualifications
of the brokers and dealers as such.
B. Shall show the nature of the services or benefits made available.
C. Shall describe in detail the application of any general or
specific formula or other determinant used in arriving at such
allocation of purchase and sale orders and such division of brokerage
commissions or other compensation.
D. The name of the person responsible for making the determination of such
allocation and such division of brokerage commissions or other
compensation.
3. (Rule 31a-(b)(10)) A record in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the
purchase or sale of series securities. Where an authorization is made
by a committee or group, a record shall be kept of the names of its
members who participate in the authorization. There shall be retained
as part of this record: any memorandum, recommendation or instruction
supporting or authorizing the purchase or sale of series securities and
such other information as is appropriate to support the authorization.*
4. (Rule 31a-1(f)) Such accounts, books and other documents as are
required to be maintained by registered investment advisers by rule
adopted under Section 204 of the Investment Advisers Act of 1940, to
the extent such records are necessary or appropriate to record the
Subadviser's transactions for the Fund.
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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 recommendation; i.e., buy, sell, hold) or any internal reports
or subadviser review.
SCHEDULE C
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SUBADVISORY FEE
For services provided to The Phoenix Real Estate Securities Series (the
"Series"), the Adviser will pay to the Subadviser, on or before the 10th day of
each month, a fee, payable in arrears, at the annual rate of 0.45% of the
average daily net asset values of the Series up to $1 billion; 0.35% of such
values from $l billion to $2 billion; and 0.30% of such values in excess of $2
billion. The fees shall be prorated for any month during which this agreement is
in effect for only a portion of the month. In computing the fee to be paid to
the Subadviser, the net asset value of the Series shall be valued as set forth
in the then current registration statement of the Fund.
SCHEDULE D
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SUBADVISER FUNCTIONS
With respect to managing the investment and reinvestment of the
Series's assets, the Subadviser shall provide, at its own expense:
(a) Investment research, advice and analysis, including, without
limitation, initial and ongoing i) assessment of national,
regional and specific real estate markets and real estate
related equities, and ii) detailed analysis of real estate
investment trust assets considered for purchase and held by
the Series with respect to INTER ALIA local market conditions,
fair market value, overall property condition, insurance
coverages and deductibles, tenant composition and vacancies,
compliance matters relating to zoning, handicap accessibility,
environmental, and other applicable codes, and such other
matters as the Adviser shall from time to time request;
(b) An investment program for the Series consistent with its
investment objectives based upon the development, review and
adjustment of buy/sell strategies approved from time to time
by the Board of Trustees and Adviser;
(c) Implementation of the investment program for the Series based
upon the foregoing criteria;
(d) Quarterly reports, in form and substance acceptable to the
Adviser, with respect to: i) compliance with the Phoenix Code of
Ethics and the Subadviser'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
Series assets in accordance with the then prevailing prospectus
and statement of additional information pertaining to the Series
and governing laws; iv) compliance with governing 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's limitation on
acquisition of illiquid securities; v) any and all other reports
reasonably requested in accordance with or described in this
Agreement; and, vi) the implementation of the Series's investment
program, including, without limitation, analysis of Series
performance;
(e) Attendance by appropriate representatives of the Subadviser at
meetings requested by the Adviser or Trustees at such time(s) and
location(s) as requested by the Adviser or Trustees, including
furnishing of adequate conference space at the offices of the
Subadviser (or such other acceptable meeting location in
Baltimore, Maryland) if requested; and
(f) Participation, overall assistance and support in marketing the
Series, 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 Adviser.
