Exhibit 5.4
Subadvisory Agreement
PHOENIX MULTI-PORTFOLIO FUND
SUBADVISORY AGREEMENT
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November 19, 1997
Duff & Xxxxxx Investment Management Co.
00 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx
RE: SUBADVISORY AGREEMENT
Gentlemen:
Phoenix Multi-Portfolio 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 or may be offered in several series,
including the Real Estate Securities Portfolio (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 Duff & Xxxxxx Investment Management Co. (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
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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 at the time of the
transaction 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, the Custodian(s) from time
to time designated by the Fund (the "Custodian"), or such depositories
or agents as may be designated by the Custodian in writing, of all cash
and/or securities due to or from the Series. The Subadviser shall not
have possession or custody of such cash and/or securities or any
responsibility or liability with respect to such custody. The
Subadviser shall advise the Custodian and confirm in writing to the
Fund all investment orders for the 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 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
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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 Conduct Rules
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 that is an "affiliated person" (as
defined in the Act) of the Fund, the Subadviser or the Adviser without
the prior written approval of the Fund. The Fund will provide the
Subadviser with a list of brokers and dealers that are "affiliated
persons" of the Fund or Adviser.
6. Proxies. The 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 Investment
Advisory Agreement between the Fund and the Adviser, the Adviser is
solely 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
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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 or to Adviser as agent of the
Fund promptly upon request of either.
C. It has or shall adopt a written code of ethics complying
with the requirements of Rule 17j-l under the Act and will
provide the Fund and Adviser with a copy of the code of ethics
and evidence of its adoption.
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Subadviser acknowledges receipt of the written code of ethics
adopted by and on behalf of the Fund (the "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 and to Adviser
that the Subadviser has complied with the requirements of Rule
17j-l during the previous calendar quarter and that there has
been no violation of its code of ethics, or the Code of
Ethics, or if such a violation has occurred, that appropriate
action was taken in response to such violation. The Subadviser
shall permit the Fund and Adviser to examine the reports
required to be made by the Subadviser under Rule 17j-l(c)(1)
and this subparagraph.
D. Reference is hereby made to the 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 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 Phoenix Multi-Portfolio 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
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 Fund or of any successor of the Fund, whether
such liability now exists or is hereafter incurred for claims
against the trust estate.
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
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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.
16. 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.
PHOENIX MULTI-PORTFOLIO FUND
By: /s/ Xxxxxx X. XxXxxxxxxx
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Xxxxxx X. XxXxxxxxxx
President
PHOENIX REALTY SECURITIES, INC.
By: /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
President
ACCEPTED:
DUFF & XXXXXX INVESTMENT
MANAGEMENT CO.
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
Vice President
SCHEDULES: A. Operational Procedures
B. Record Keeping Requirements
C. Fee Schedule
D. Subadviser Functions
SCHEDULE A
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OPERATIONAL PROCEDURES
In order to minimize operational problems, it will be necessary for a flow of
information to be supplied to State Street Bank and Trust Company (the
"Custodian"), the custodian for the Fund.
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
(a) For services provided to the Fund, the Adviser will pay to the
Subadviser, on or before the 10th day of each month, a fee, payable in arrears,
at the annual rate of 0.45% of the average daily net asset values of the Series
up to $1 billion; 0.35% of such values from $1 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 Fund
and each 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'
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
converages 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 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' 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' 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 reasonably requested by the Adviser or
Trustees; 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.