Selected Data For a Share of Capital Stock Outstanding Throughout Each Year:
Subject to Completion, March 24, 2005
STATEMENT OF ADDITIONAL INFORMATION
March 28, 2005
Acquisition of the Assets of
PHOENIX-LAZARD SMALL-CAP VALUE SERIES
(A series of The Phoenix Edge Series Fund)
101 Munson Street
Greenfield, Massachusetts 01301
1-800-541-0171
By and in Exchange for Shares of
LAZARD RETIREMENT SMALL CAP PORTFOLIO
(A series of Lazard Retirement Series, Inc.)
30 Rockefeller Plaza
New York, New York 10112
212-632-6000
This Statement of Additional Information, which is not a prospectus, supplements and should be read in conjunction with the Prospectus/Proxy Statement dated March 28, 2005 relating specifically to the proposed transfer of all of the assets and liabilities of Phoenix-Lazard Small Cap Value Series (the "Phoenix Portfolio"), a series of The Phoenix Edge Series Fund (the "Trust"), in exchange for shares of common stock of Lazard Retirement Small Cap Portfolio (the "Lazard Portfolio"), a series of Lazard Retirement Series, Inc. ("LRS"). The transfer is to occur pursuant to a Plan of Reorganization. This Statement of Additional Information consists of this cover page and the following documents attached hereto:
| 1. | The Trust's Statement of Additional Information dated May 1, 2004. |
| 2. | LRS' Statement of Additional dated May 1, 2004, as revised December 30, 2004. |
| 3. | The Phoenix Portfolio's Annual Report for the fiscal year ended December 31, 2004. |
| 4. | The Lazard Portfolio's Annual Report for the fiscal year ended December 31, 2004. |
| 5. | Pro forma financials for the Lazard Portfolio, Phoenix Portfolio and Combined Portfolio as of December 31, 2004. |
LRS' Statement of Additional Information, and the financial statements included in the Lazard Portfolio's Annual Report are incorporated herein by reference. The Prospectus/Proxy Statement dated March 28, 2005 may be obtained by writing to LRS at 30 Rockefeller Plaza, New York, New York 10112.
DOCUMENTS INCORPORATED BY REFERENCE
LRS' Statement of Additional Information dated May 1, 2004, as revised December 30, 2004, is incorporated herein by reference to LRS' Post-Effective Amendment No. 14 to its Registration Statement on Form N-1A, filed on December 3, 2004 (File No. 333-22309). The financial statements of the Lazard Portfolio are incorporated herein by reference to its Annual Report for the fiscal year ended December 31, 2004, filed March 4, 2005.
The Trust's Statement of Additional Information dated May 1, 2004 is incorporated herein by reference to the Trust's Post-Effective Amendment No. 47 to its Registration Statement on Form N-1A, filed on April 30, 2004 (File No. 33-5033). The financial statements of the Phoenix Portfolio are incorporated herein by reference to its Annual Report for the fiscal year ended December 31, 2004, filed March 9, 2005.
PRO-FORMA SCHEDULE OF INVESTMENTS
DECEMBER 31, 2004
(unaudited)
S H A R E S V A L U E
---------------------------------------- ----------------------------------------
LRS Phoenix-Lazard LRS Small Cap LRS Phoenix-Lazard LRS Small Cap
Small Cap Small-Cap Portfolio Small Cap Small-Cap Portfolio
Portfolio Value Pro-Forma Portfolio Value Pro-Forma
Series Combined Series Combined
Common Stocks--95.2%
Aerospace & Defense--2.3%
DRS Technologies, Inc. (a) $27,600 $3,250 $30,850 $1,178,796 $138,807 $1,317,603
Esterline Technologies Corp. (a) 12,400 1,400 13,800 404,860 45,710 450,570
The Titan Corp. (a) 55,100 7,900 63,000 892,620 127,980 1,020,600
95,100 12,550 107,650 2,476,276 312,497 2,788,773
Agriculture--0.8%
Delta & Pine Land Co. 33,900 3,550 37,450 924,792 96,844 1,021,636
Apparel & Textiles--4.8%
AnnTaylor Stores Corp. (a) 28,200 3,100 31,300 607,146 66,743 673,889
Hot Topic, Inc. (a) 51,900 5,900 57,800 892,161 101,421 993,582
K-Swiss, Inc., Class A 19,400 2,300 21,700 564,928 66,976 631,904
The Gymboree Corp. (a) 59,000 5,550 64,550 756,380 71,151 827,531
The Sports Authority, Inc. (a) 34,600 3,500 38,100 890,950 90,125 981,075
The Timberland Co., Class A (a) 13,000 1,500 14,500 814,710 94,005 908,715
The Warnaco Group, Inc. (a) 39,500 4,400 43,900 853,200 95,040 948,240
245,600 26,250 271,850 5,379,475 585,461 5,964,936
Automotive--2.2%
CSK Auto Corp. (a) 43,500 3,900 47,400 728,190 65,286 793,476
Rush Enterprises, Inc., Class A (a) 26,600 2,800 29,400 431,718 45,444 477,162
TBC Corp. (a) 27,300 3,300 30,600 758,940 91,740 850,680
Winnebago Industries, Inc. 13,600 1,600 15,200 531,216 62,496 593,712
111,000 11,600 122,600 2,450,064 264,966 2,715,030
Banking--7.3%
Bank of the Ozarks, Inc. 2,200 2,200 74,866 74,866
First Community Bancorp 13,200 2,000 15,200 563,640 85,400 649,040
First Midwest Bancorp, Inc. 20,600 2,400 23,000 747,574 87,096 834,670
First Republic Bank 11,700 1,300 13,000 620,100 68,900 689,000
Hudson United Bancorp 7,800 1,000 8,800 307,164 39,380 346,544
MB Financial, Inc. 13,500 700 14,200 569,025 29,505 598,530
Provident Bankshares Corp. 18,900 2,000 20,900 687,393 72,740 760,133
Sterling Bancshares, Inc. 69,200 7,800 77,000 987,484 111,306 1,098,790
Texas Regional Bancshares, Inc., Class A 17,400 1,850 19,250 568,632 60,458 629,090
Umpqua Holdings Corp. 18,800 2,300 21,100 473,948 57,983 531,931
United Bankshares, Inc. 25,700 2,250 27,950 980,455 85,838 1,066,293
W Holding Co., Inc. 26,068 3,103 29,171 598,003 71,179 669,182
Westamerica Bancorporation 16,100 2,000 18,100 938,791 116,620 1,055,411
261,168 28,703 289,871 8,117,075 886,405 9,003,480
Building & Construction--1.5%
Chicago Bridge & Iron Co. NV, NY Shares 19,800 2,350 22,150 792,000 94,000 886,000
The Shaw Group, Inc. (a) 48,500 5,600 54,100 865,725 99,960 965,685
68,300 7,950 76,250 1,657,725 193,960 1,851,685
Business Services & Supplies--8.4%
ADVO, Inc. 38,900 3,775 42,675 1,386,785 134,579 1,521,364
Arbitron, Inc. (a) 30,700 3,700 34,400 1,202,826 144,966 1,347,792
BearingPoint, Inc. (a) 72,400 6,600 79,000 581,372 52,998 634,370
Herman Miller, Inc. 38,000 3,200 41,200 1,049,940 88,416 1,138,356
MPS Group, Inc. (a) 76,000 10,300 86,300 931,760 126,278 1,058,038
ProQuest Co. (a) 22,100 2,650 24,750 656,370 78,705 735,075
Tetra Tech, Inc. (a) 64,300 7,900 72,200 1,076,382 132,246 1,208,628
The BISYS Group, Inc. (a) 49,000 4,400 53,400 806,050 72,380 878,430
Veritas DGC, Inc. (a) 35,400 4,500 39,900 793,314 100,845 894,159
Watson Wyatt & Co. Holdings 32,000 4,300 36,300 862,400 115,885 978,285
458,800 51,325 510,125 9,347,199 1,047,298 10,394,497
Chemicals--2.6%
Ferro Corp. 19,300 2,250 21,550 447,567 52,178 499,745
Olin Corp. 41,900 4,850 46,750 922,638 106,797 1,029,435
PolyOne Corp. (a) 67,500 10,200 77,700 611,550 92,412 703,962
Spartech Corp. 30,500 3,600 34,100 826,245 97,524 923,769
159,200 20,900 180,100 2,808,000 348,911 3,156,911
Coal--0.7%
Foundation Coal Holdings, Inc. 31,500 3,500 35,000 726,390 80,710 807,100
Computer Software--2.5%
Avocent Corp. (a) 13,800 1,600 15,400 559,176 64,832 624,008
Catapult Communications Corp. (a) 6,200 800 7,000 149,792 19,328 169,120
JDA Software Group, Inc. (a) 32,000 3,400 35,400 435,840 46,308 482,148
SERENA Software, Inc. (a) 41,500 4,700 46,200 898,060 101,708 999,768
Verity, Inc. (a) 52,200 6,500 58,700 684,864 85,280 770,144
145,700 17,000 162,700 2,727,732 317,456 3,045,188
Computers & Business Equipment--2.5%
Advanced Digital Information Corp. (a) 54,300 6,350 60,650 544,086 63,627 607,713
Black Box Corp. 1,600 100 1,700 76,832 4,802 81,634
Foundry Networks, Inc. (a) 50,700 6,200 56,900 667,212 81,592 748,804
Komag, Inc. (a) 46,300 5,200 51,500 869,514 97,656 967,170
Photon Dynamics, Inc. (a) 27,500 3,100 30,600 667,700 75,268 742,968
180,400 20,950 201,350 2,825,344 322,945 3,148,289
Consumer Products--1.1%
Jarden Corp. (a) 8,300 600 8,900 360,552 26,064 386,616
The Scotts Co., Class A (a) 12,200 1,500 13,700 896,944 110,280 1,007,224
20,500 2,100 22,600 1,257,496 136,344 1,393,840
Diversified--0.8%
The Liberty Corp. 21,800 1,900 23,700 958,328 83,524 1,041,852
Drugs & Health Care--6.6%
Able Laboratories, Inc. (a) 28,000 3,600 31,600 637,000 81,900 718,900
Andrx Corp. (a) 43,200 5,300 48,500 943,056 115,699 1,058,755
Beverly Enterprises, Inc. (a) 115,700 15,400 131,100 1,058,655 140,910 1,199,565
Kindred Healthcare, Inc. (a) 34,000 4,100 38,100 1,018,300 122,795 1,141,095
LifePoint Hospitals, Inc. (a) 39,300 3,500 42,800 1,368,426 121,870 1,490,296
MIM Corp. (a) 85,800 8,900 94,700 544,830 56,515 601,345
Select Medical Corp. 63,600 7,300 70,900 1,119,360 128,480 1,247,840
Taro Pharmaceutical Industries, Ltd. (a) 17,100 1,800 18,900 581,913 61,254 643,167
426,700 49,900 476,600 7,271,540 829,423 8,100,963
Education--2.0%
Corinthian Colleges, Inc. (a) 40,700 6,100 46,800 766,992 114,954 881,946
DeVry, Inc. (a) 31,400 3,400 34,800 545,104 59,024 604,128
Leapfrog Enterprises, Inc. (a) 1,500 1,200 2,700 20,400 16,320 36,720
Learning Tree International, Inc. (a) 67,900 5,200 73,100 909,860 69,680 979,540
141,500 15,900 157,400 2,242,356 259,978 2,502,334
Electrical Equipment--2.8%
Coherent, Inc. (a) 26,000 3,000 29,000 791,440 91,320 882,760
General Cable Corp. (a) 12,300 1,300 13,600 170,355 18,005 188,360
GrafTech International, Ltd. (a) 56,800 8,000 64,800 537,328 75,680 613,008
Plexus Corp. (a) 52,700 6,800 59,500 685,627 88,468 774,095
Rogers Corp. (a) 20,700 2,300 23,000 892,170 99,130 991,300
168,500 21,400 189,900 3,076,920 372,603 3,449,523
Electronics--1.8%
Metrologic Instruments, Inc. (a) 33,700 4,200 37,900 716,125 89,250 805,375
TTM Technologies, Inc. (a) 104,400 10,400 114,800 1,231,920 122,720 1,354,640
138,100 14,600 152,700 1,948,045 211,970 2,160,015
Environmental--0.5%
Waste Connections, Inc. (a) 15,950 1,850 17,800 546,288 63,362 609,650
Equipment Rental--0.4%
United Rentals, Inc. (a) 25,200 2,600 27,800 476,280 49,140 525,420
Financial Services--5.0%
Calamos Asset Management, Inc., Class A 23,300 2,500 25,800 629,100 67,500 696,600
eSPEED, Inc., Class A (a) 67,300 8,500 75,800 832,501 105,145 937,646
Financial Federal Corp. (a) 17,000 1,450 18,450 666,400 56,840 723,240
IndyMac Bancorp, Inc. 13,200 1,550 14,750 454,740 53,398 508,138
Knight Trading Group, Inc., Class A (a) 103,700 8,700 112,400 1,135,515 95,265 1,230,780
MAF Bancorp, Inc. 20,100 2,800 22,900 900,882 125,496 1,026,378
The South Financial Group, Inc. 28,200 3,100 31,300 917,346 100,843 1,018,189
272,800 28,600 301,400 5,536,484 604,487 6,140,971
Food & Beverages--0.6%
Performance Food Group Co. (a) 25,400 2,300 27,700 683,514 61,893 745,407
Forest & Paper Products--0.5%
Packaging Corp. of America 22,400 2,650 25,050 527,520 62,408 589,928
Household Products & Home Furnishings--0.4%
Cost Plus, Inc. (a) 14,100 1,900 16,000 453,033 61,047 514,080
Industrial & Machinery--1.9%
Roper Industries, Inc. 18,100 1,650 19,750 1,099,937 100,270 1,200,207
Tecumseh Products Co., Class A 21,300 2,100 23,400 1,018,140 100,380 1,118,520
39,400 3,750 43,150 2,118,077 200,650 2,318,727
Insurance--3.3%
Arch Capital Group, Ltd. (a) 28,800 3,100 31,900 1,114,560 119,970 1,234,530
Assured Guaranty, Ltd. 49,200 6,200 55,400 967,764 121,954 1,089,718
Bristol West Holdings, Inc. 7,800 700 8,500 156,000 14,000 170,000
Max Re Capital, Ltd. 30,700 2,850 33,550 654,831 60,790 715,621
Reinsurance Group of America, Inc. 15,900 1,350 17,250 770,355 65,408 835,763
132,400 14,200 146,600 3,663,510 382,122 4,045,632
Leisure & Entertainment--1.1%
Alliance Gaming Corp. (a) 57,400 6,200 63,600 792,694 85,622 878,316
WMS Industries, Inc. (a) 13,200 1,600 14,800 442,728 53,664 496,392
70,600 7,800 78,400 1,235,422 139,286 1,374,708
Medical Products & Services--3.5%
Bio-Rad Laboratories, Inc., Class A (a) 800 200 1,000 45,896 11,474 57,370
Charles River Laboratories International,
Inc. (a) 6,288 816 7,104 289,311 37,544 326,855
Cutera, Inc. 7,900 800 8,700 98,592 9,984 108,576
DJ Orthopedics, Inc. (a) 42,000 4,800 46,800 899,640 102,816 1,002,456
Hanger Orthopedic Group, Inc. (a) 12,900 900 13,800 104,490 7,290 111,780
INAMED Corp. (a) 15,950 1,575 17,525 1,008,837 99,619 1,108,456
Martek Biosciences Corp. (a) 8,600 1,000 9,600 440,320 51,200 491,520
PSS World Medical, Inc. (a) 72,400 7,500 79,900 906,086 93,862 999,948
Respironics, Inc. (a) 800 300 1,100 43,488 16,309 59,797
Viasys Healthcare, Inc. (a) 4,000 700 4,700 76,000 13,300 89,300
171,638 18,591 190,229 3,912,660 443,398 4,356,058
Oil & Gas--7.0%
Bill Barrett Corp. 7,300 900 8,200 233,527 28,791 262,318
Denbury Resources, Inc. (a) 20,500 2,400 22,900 562,725 65,880 628,605
Energy Partners, Ltd. (a) 21,200 2,300 23,500 429,724 46,621 476,345
Forest Oil Corp. (a) 20,900 2,000 22,900 662,948 63,440 726,388
Grey Wolf, Inc. (a) 104,300 12,000 116,300 549,661 63,240 612,901
Hanover Compressor Co. (a) 51,400 5,900 57,300 726,282 83,367 809,649
Key Energy Services, Inc. (a) 108,800 12,850 121,650 1,283,840 151,630 1,435,470
Kinder Morgan Management, LLC (a) 21,484 3,053 24,537 874,399 124,257 998,656
Maverick Tube Corp. (a) 13,800 2,500 16,300 418,140 75,750 493,890
Range Resources Corp. 28,500 2,700 31,200 583,110 55,242 638,352
The Houston Exploration Co. (a) 12,000 1,800 13,800 675,720 101,358 777,078
Whiting Petroleum Corp. (a) 22,700 2,000 24,700 686,675 60,500 747,175
432,884 50,403 483,287 7,686,751 920,076 8,606,827
Printing & Publishing--1.9%
Journal Register Co. (a) 56,668 7,200 63,868 1,095,392 139,176 1,234,568
R. H. Donnelley Corp. (a) 17,700 1,900 19,600 1,045,185 112,195 1,157,380
74,368 9,100 83,468 2,140,577 251,371 2,391,948
Real Estate--3.1%
Alexandria Real Estate Equities, Inc. 5,500 600 6,100 409,310 44,652 453,962
Capital Automotive REIT 10,400 1,100 11,500 369,460 39,078 408,538
CarrAmerica Realty Corp. 15,100 1,950 17,050 498,300 64,350 562,650
Inland Real Estate Corp. 21,800 1,600 23,400 347,710 25,520 373,230
Lexington Corporate Properties Trust 25,300 2,400 27,700 571,274 54,192 625,466
Prentiss Properties Trust 8,200 900 9,100 313,240 34,380 347,620
The Mills Corp. 14,500 1,650 16,150 924,520 105,204 1,029,724
100,800 10,200 111,000 3,433,814 367,376 3,801,190
Restaurants--0.6%
CBRL Group, Inc. 15,900 1,800 17,700 665,415 75,330 740,745
Retail--1.5%
99 Cents Only Stores (a) 50,500 3,600 54,100 816,080 58,176 874,256
Tractor Supply Co. (a) 22,300 2,500 24,800 829,783 93,025 922,808
72,800 6,100 78,900 1,645,863 151,201 1,797,064
Semiconductors & Components--3.5%
AMIS Holdings, Inc. (a) 53,300 4,400 57,700 880,516 72,688 953,204
Benchmark Electronics, Inc. (a) 20,700 2,300 23,000 705,870 78,430 784,300
Brooks Automation, Inc. (a) 41,400 5,000 46,400 712,908 86,100 799,008
ChipMOS TECHNOLOGIES Ltd. 12,400 12,400 78,988 78,988
Exar Corp. (a) 81,000 8,000 89,000 1,149,390 113,520 1,262,910
Ultratech, Inc. (a) 22,600 2,000 24,600 426,010 37,700 463,710
219,000 34,100 253,100 3,874,694 467,426 4,342,120
Steel--0.6%
Schnitzer Steel Industries, Inc., Class A 9,400 1,100 10,500 318,942 37,323 356,265
Steel Dynamics, Inc. 8,400 1,000 9,400 318,192 37,880 356,072
17,800 2,100 19,900 637,134 75,203 712,337
Telecommunications--2.9%
C-COR, Inc. (a) 109,500 12,800 122,300 1,018,350 119,040 1,137,390
CommScope, Inc. (a) 52,900 5,000 57,900 999,810 94,500 1,094,310
Ditech Communications Corp. (a) 28,700 2,600 31,300 429,065 38,870 467,935
Oplink Communications, Inc. (a) 104,000 12,000 116,000 204,880 23,640 228,520
Wireless Facilities, Inc. (a) 56,800 6,600 63,400 536,192 62,304 598,496
351,900 39,000 390,900 3,188,297 338,354 3,526,651
Transportation--4.2%
AirTran Holdings, Inc. (a) 72,500 7,700 80,200 775,750 82,390 858,140
Forward Air Corp. (a) 17,100 1,900 19,000 764,370 84,930 849,300
OMI Corp. 40,900 5,900 46,800 689,165 99,415 788,580
Overnite Corp. 18,500 2,000 20,500 688,940 74,480 763,420
Pacer International, Inc. (a) 55,800 6,400 62,200 1,186,308 136,064 1,322,372
Swift Transportation Co., Inc. (a) 26,200 3,050 29,250 562,776 65,514 628,290
231,000 26,950 257,950 4,667,309 542,793 5,210,102
Utilities--2.0%
AGL Resources, Inc. 22,000 2,550 24,550 731,280 84,762 816,042
Cleco Corp. 39,400 5,000 44,400 798,244 101,300 899,544
New Jersey Resources Corp. 15,100 60,676 75,776 654,434 60,676 715,110
76,500 68,226 144,726 2,183,958 246,738 2,430,696
Total Common Stocks
(Identified cost LRS
Small Cap Portfolio: $91,811,517) 5,090,608 642,298 5,732,906 105,471,357 11,854,956 117,326,313
(Identified cost Phoenix-Lazard
Small-Cap Value Portfolio: $9,919,028)
(Identified cost LRS Small Cap
Portfolio-Pro Forma Combined: $107,730,545)
Short-Term Investments---6.1% PAR / PRINCIPAL AMOUNT (000)
----------------------------------------
U.S. Treasury Bills---0.5%
U.S.Treasury Bill 1.79%, 1/6/05 $ 2 $ 2 1,999 1,999
U.S.Treasury Bill 1.857%, 1/6/05 115 115 114,970 114,970
U.S.Treasury Bill 1.983%, 1/6/05 61 61 60,983 60,983
U.S.Treasury Bill 1.80%, 2/10/05 94 94 93,812 93,812
U.S.Treasury Bill 1.915%, 2/10/05 81 81 80,828 80,828
U.S.Treasury Bill 1.95%, 2/10/05 127 127 126,725 126,725
U.S.Treasury Bill 2.08%, 2/10/05 68 68 67,847 67,847
U.S.Treasury Bill 2.09%, 2/10/05 81 81 80,818 80,818
627,982 627,982
Repurchase Agreement--5.6%
State Street Bank and Trust Co., 1.40%, 01/03/05,
(Dated 12/31/04, collateralized by $6,995,000 United States Treasury
Note, 2.50%, 09/30/06, with a value of $6,976,897)
$ 6,840 $ 6,840 $ 6,840,000 6,840,000
Total Short-Term Investments
(Identified cost LRS Small
Cap Portfolio $6,840,000) $ 6,840 $ 629 $ 7,469 $ 6,840,000 $ 627,982 $ 7,467,982
(Identified cost Phoenix-Lazard
Small-Cap Value Portfolio: $627,972)
(Identified cost LRS Small Cap
Portfolio--Pro Forma Combined: $7,467,972)
Total Investments----101.3%
(Identified cost LRS Small cap Portfolio: $98,651,517) 112,311,357 12,482,938 124,794,295
(Identified cost Phoenix-Lazard Small-Cap
Value Portfolio: $10,547,000)
(Identified cost LRS Small Cap
Portfolio--Pro Forma Combined: $109,198,517)
Liabilities in Excess of Cash and Other Assets---(1.3)% (1,329,486) (227,032) (1,556,518)
-----------------------------------------
Net Assets---100.00% $110,981,871 $12,255,906 $123,237,777
=========================================
(a) Non-income producing security.
(b) For federal income tax purposes, the aggregate cost, aggregate gross unrealized appreciation, aggregate gross unrealized
depreciation and the net unrealized appreciation is as follows:
Aggregate Aggregate
Gross Gross Net
Aggregate Unrealized Unrealized Unrealized
Portfolio Cost Appreciation Depreciation Depreciation
- --------- ---- ------------ ------------ ------------
Phoenix-Lazard Small-Cap
Value Series $ 10,603,484 $ 2,055,632 $ 176,178 $ 1,879,454
LRS Small Cap Portfolio $ 98,857,945 $ 15,407,233 $ 1,953,821 $ 13,453,412
See notes to pro forma financial statements.
THE LAZARD FUNDS, INC.
Statements of Assets and Liabilities
December 31, 2004
(unaudited)
Lazard Phoenix-Lazard Lazard Retirement
Retirement Small Small Cap Value Small Cap
Cap Portfolio Portfolio Adjustments Pro-Forma
-------------------------------------------------------------------------------------
ASSETS
Investments in Securities, at value $ 112,311,357 $ 12,482,938 $ 124,794,295
Cash 752 36,018 36,770
Foreign Currency -- -- --
Receivables for: -- --
Investments sold 570,618 53,871 624,489
Dividends and interest 56,374 6,074 62,448
Capital stock sold 52,675 35,571 88,246
Due from Investment Manager -- 3,503 3,503
Prepaid expenses -- 237 237
---------------------------------------------------------------------------------
Total assets 112,991,776 12,618,212 -- 125,609,988
---------------------------------------------------------------------------------
LIABILITIES
Payables for:
Investments purchased 1,769,911 306,092 2,076,003
Capital stock repurchased 135,640 7,188 142,828
Dividends payable -- -- --
Gross depreciation on foreign
currency contracts -- -- --
Payable upon return of securities on
loan -- -- --
Management fees payable 56,271 -- 56,271
Accrued directors' / trustees' fee
payable 427 147 574
Accrued distribution fee payable 22,761 -- 22,761
Accrued Merger expenses -- -- --
Other accrued expenses and payables 24,895 48,879 73,774
--------------------------------------------------------------------------------
Total liabilities 2,009,905 362,306 -- 2,372,211
--------------------------------------------------------------------------------
Net assets $ 110,981,871 12,255,906 123,237,777
=====================================================================================
NET ASSETS
Paid in capital $ 88,038,952 $ 10,117,023 98,155,975
Undistributed net investment income 39,674 -- 39,674
Net unrealized appreciation
(depreciation) on investments 13,659,840 1,935,938 15,595,778
Accumulated undistributed net realized
gain (loss) 9,243,305 202,945 9,446,250
-------------------------------------------------------------------------------------
Net assets $ 110,981,771 $ 12,255,906 -- $ 123,237,677
=====================================================================================
Shares of capital stock outstanding 6,567,766 866,036 (140,747) 7,293,055
Net asset value, offering and
redemption price per share $ 16.90 $ 14.15 $ 16.90
Cost of investments in securities $ 98,651,517 $ 10,547,000 $ 109,198,517
See notes to pro forma financial statements
STATEMENTS OF
OPERATIONS (unaudited)
For the year ended
December 31, 2004
Lazard
Lazard Phoenix-Lazard Small Cap
Small Cap Small-Cap Value Portfolio
Portfolio Portfolio Adjustments Pro-Forma Combined
INVESTMENT INCOME
Income:
Interest $ 742,437 $ 3,923 $ 746,360
Dividends 58,173 82,787 140,960
---------------------------------------------------------- --------------------------
Total investment income* 800,610 86,710 -- 887,320
---------------------------------------------------------- --------------------------
Expenses:
Management Fees $ 667,426 104,105 (17,351) (a) $ 754,180
Distribution Fees 222,475 - 28,918 (b) 251,393
Custodian Fees 94,933 27,766 (36,229) (a) 86,470
Professional Services 61,307 32,330 (29,837) (a) 63,800
Administration Fees 55,453 45,999 (43,554) (a) 57,898
Shareholders' services 14,868 - (468) (a) 14,400
Shareholders' reports 9,411 16,848 (17,259) (a) 9,000
Directors'/Trustees' fees and
expenses 6,749 9,466 (7,558) (a) 8,657
Other 3,595 9,697 (9,542) (a) 3,750
Registration Fees 2,250 -- 662 2,912
---------------------------------------------------------- --------------------------
Gross expenses 1,138,467 246,211 (132,217) 1,252,461
Management Fees Waived/Expense
Reimbursement (26,295) (124,748) 151,043 0
Expense reductions (116) (6) -- (122)
---------------------------------------------------------- --------------------------
Total net expenses 1,112,056 121,457 18,826 1,252,339
---------------------------------------------------------- --------------------------
Investment income-net (311,446) (34,747) (18,826) (365,019)
---------------------------------------------------------- --------------------------
NET REALIZED AND
UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized gain (loss) on
investments 12,747,580 1,175,015 13,922,595
Net change in unrealized
appreciation on investments 987,411 215,581 1,202,992
---------------------------------------------------------- --------------------------
Realized and unrealized gain
(loss) on investments 13,734,991 1,390,596 -- 15,125,587
---------------------------------------------------------- --------------------------
Net increase in net assets
resulting from operations $ 13,423,545 1,355,849 (18,826) $ 14,760,568
========================================================== ==========================
* Net of foreign withholding
taxes of $ 1,352 246 1,598
(a) Reflects anticipated savings as a result of the merger.
(b) Reflects 0.25% distribution fee applicable to shares issued as result of merger; Phoenix shares do not impose a
distribution fee.
See notes to pro forma financial statements.
NOTES TO PRO FORMA FINANCIAL STATEMENTS (UNAUDITED)NOTE 1. Basis of Merger
The Board of Trustees of The Phoenix Edge Series Fund (the "Trust") has approved, subject to shareholder approval, an Agreement and Plan of Reorganization (the "Plan") between the Phoenix-Lazard Small-Cap Value Series (the "Phoenix Portfolio") and Lazard Retirement Small Cap Portfolio (the "Lazard Portfolio" and, together with the Phoenix Portfolio, the "Portfolios"), a series of Lazard Retirement Series, Inc. ("LRS"). The Plan provides for the transfer of all of the assets of the Phoenix Portfolio, subject to its stated liabilities, to the Lazard Portfolio in a tax-free exchange for shares of the Lazard Portfolio and the distribution of such shares to the shareholders of the Phoenix Portfolio (the "Exchange"). The Exchange will be accounted for as a tax-free merger of investment companies. The unaudited pro forma statement of investments and statement of assets and liabilities reflect the financial position of the Portfolios at December 31, 2004.
The unaudited pro forma statement of operations reflects the results of operations of the Portfolios for the twelve months ended December 31, 2004. These statements have been derived from the books and records of the Portfolios utilized in calculating daily net asset value at the dates indicated above under accounting principles generally accepted in the United States of America. The historical cost of investment securities will be carried forward to the Lazard Portfolio as the surviving entity. The fiscal year for both Portfolios is December 31st.
The pro forma statements of investments, assets and liabilities and operations should be read in conjunction with the historical financial statements of the Phoenix Portfolio and the Lazard Portfolio included or incorporated by reference in its respective Statement of Additional Information. The pro forma combined financial statements are presented for information only and may not necessarily be representative of what the actual combined financial statements would have been had the Exchange occurred on December 31, 2004. Following the Exchange, the Lazard Portfolio will be the accounting survivor.
NOTE 2. Portfolio Valuation
Phoenix-Lazard Small-Cap Value Series:
The Phoenix Portfolio's investments are valued at market value or, where market quotations are not available, at fair value as determined in good faith by the Board of Trustees of the Trust or its delegates. Equity securities are valued at the last official closing price (typically sale) on the exchange on which the securities are principally traded, or, if no closing price is available at the last bid price. Debt securities (other than short-term investments) are valued on the basis of broker quotations or valuations provided by a pricing service, which in determining value utilizes information with respect to recent sales, market transactions in comparable securities, quotations from dealers, and various relationships between securities, approved by the Board of Trustees of the Trust when such prices are believed to reflect the fair value of such securities. As required, some securities and assets are valued at fair value as determined in good faith by or under the direction of the Board of Trustees of the Trust.
Certain foreign common stocks may be fair valued in cases where closing prices are not readily available or are deemed not reflective of readily available market prices. For example, significant events (such as movement in the U.S. securities market, or other regional and local developments) may occur between the time that foreign markets close (where the security is principally traded) and the time that the series calculates its net asset value (generally, the close of the New York Stock Exchange, the "NYSE") that may impact the value of securities traded in these foreign markets. In these cases, information from an external vendor may be utilized to adjust closing market prices of certain foreign common stocks to reflect their fair value. Because the frequency of significant events is not predictable, fair valuation of certain foreign common stocks may occur on a frequent basis.
Lazard Retirement Small Cap Portfolio:
Market values for equity securities listed on the NYSE, NASDAQ national market or other U.S. exchanges or markets are based on the closing market price on the principal exchange or market on which the security is traded, generally as of the close of regular trading on the NYSE (normally 4:00 p.m. Eastern time) on each valuation date; securities not traded on the valuation date are valued at the closing bid price. Any securities not listed, for which current over-the-counter market quotations or bids are readily available, are valued at the last quoted bid price or, if available, the mean of two such prices. Securities listed on foreign exchanges are valued at the last reported sales price, except as described below.
If events materially affecting the value of securities occur between the close of the exchange or market on which the security is principally traded and the time when the Lazard Portfolio's net asset value is calculated, such securities will be valued at their fair values as determined by, or in accordance with procedures approved by, the Board of Directors of LRS. Fair valuing of foreign securities may be determined with the assistance of a pricing service, using correlations between the movement of prices of such securities and indices of domestic securities and other appropriate indicators, such as closing market prices of relevant American depositary receipts or futures contracts. The effect of using fair value pricing is that the net asset value of the Lazard Portfolio will be subject to the judgment of the Board of Directors of LRS or its designee instead of being determined by the market. Using a fair value pricing methodology to price securities may result in a value that is different from the most recent closing price of a security and from the prices used by other investment companies to calculate their portfolios' net asset values.
Securities for which current market quotations are not readily available are valued at fair value as determined in good faith in accordance with procedures approved by the Board of Directors of LRS. Under these procedures, in the event that Lazard Asset Management LLC, LRS' investment manager (the "Investment Manager"), determines that a significant event has occurred after the close of a market on which a foreign security is traded but before the close of regular trading on the NYSE, such that current market quotations for a security or securities are not readily available, a Valuation Committee of the Investment Manager will evaluate a variety of factors to determine the fair value of the affected securities. These factors include, but are not limited to, the type of security, the value of comparable securities, observations from financial institutions and relevant news events. Input from the Investment Manager's analyst will also be considered.
NOTE 3. Capital Shares
The pro forma number of shares that would be issuable was calculated by dividing the net assets of the Phoenix Portfolio at December 31, 2004 by the net asset value per share of the Lazard Portfolio on December 31, 2004.
NOTE 4. Pro Forma Operating Expenses
The accompanying pro forma financial statements reflect changes in expenses of the Lazard Portfolio as if the Exchange was consummated on December 31, 2004. While it is anticipated that there will be an elimination of certain duplicative expenses as a result of this Exchange, the actual amount of such future expenses is impossible to predict.
NOTE 5. Federal Income Taxes
If the Exchange is consummated, the Lazard Portfolio would seek to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended, and to distribute all its taxable income, including any realized net capital gains, to shareholders, thereby relieving the Lazard Portfolio from all, or substantially all, federal income taxes.
The identified cost of investments for the Portfolios is substantially the same for both accounting and tax purposes. The tax cost of investments will remain unchanged after the Exchange.
VOTING INSTRUCTIONS CARD
Instructions of Policyholder/Contractowner for Voting Shares of The Phoenix Edge Series Fund
These proposals are discussed in detail in the attached Proxy Statement. The Board of Trustees of The Phoenix Edge Series Fund (the "Trust") is soliciting the enclosed proxy. As a convenience, you can now vote in any one of four ways:
| | • | Through the Internet at www.proxyweb.com; |
| | • | By telephone, with a toll-free call to the Trust's proxy tabulator, at 1-800-690-6903; |
| | • | By mail, using the enclosed Voting Instructions Card(s) and postage paid envelope; or |
| | • | In person at the Special Meeting. |
We encourage you to vote by Internet or telephone. These voting methods will reduce the time and costs associated with this proxy solicitation. Whichever method you choose please read the enclosed proxy statement before you vote.
PLEASE RESPOND—IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK THAT YOU VOTE PROMPTLY. YOUR VOTE IS IMPORTANT.
The undersigned, being the owner of a variable life insurance policy ("Policyholder") or variable annuity contract ("Contractowner") issued by Phoenix Life Insurance Company and its subsidiaries (together "Phoenix"), hereby instructs Phoenix to cause the shares of Phoenix-Lazard Small-Cap Value Series (the "Phoenix Portfolio"), a series of the Trust, allocable to Policyholder's or Contractowner's account identified on this Voting Instructions Card, to be voted at the Special Meeting of Shareholders of the Phoenix Portfolio to be held on Tuesday, April 26, 2005, at One American Row, Hartford, Connecticut 06102, and at any and all adjournments or postponements thereof, in the manner directed below with respect to the matters described in the notice and accompanying Proxy Statement for said meeting which have been received by the undersigned.
THE PROXY FOR WHICH VOTING INSTRUCTIONS ARE BEING REQUESTED IS BEING SOLICITED BY THE BOARD OF TRUSTEES OF THE TRUST WHO RECOMMEND A VOTE "FOR" EACH OF THE PROPOSALS.
The voting instruction will be voted as marked. IF NOT MARKED, THIS VOTING INSTRUCTION WILL BE VOTED FOR THE PROPOSAL. If you do not vote or this voting instruction is not returned properly executed, your votes will be cast by Phoenix on behalf of the pertinent separate account in the same proportion as it votes shares held by that separate account for which it has received instructions.
Please fill in box(es) as shown using black or blue ink or number 2 pencil. Please do not use fine point pens. [X]
Name of Series: Phoenix-Lazard Small-Cap Value Series
| Proposal 1: | To approve an Agreement and Plan of Reorganization providing for the transfer of all assets and stated liabilities of the Phoenix-Lazard Small-Cap Value Series in exchange for shares of Lazard Retirement Small Cap Portfolio, and the shares so received will be distributed to shareholders of the Phoenix-Lazard Small-Cap Value Series. |
[ ] For [ ] Against [ ] Abstain
| Proposal 2: | To consider and act upon any other business as may properly come before the meeting and any adjournments thereof. |
[ ] For [ ] Against [ ] Abstain
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING INSTRUCTIONS CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
_____________________________________ _____________________________________
Signature of Participant Date Signature of Joint Owner(s) Date
Please date and sign exactly as your name appears hereon. If shares are registered in more than one name, all participants should sign this voting instruction, but if one participant signs, this signature binds the other participant(s). When signing as an attorney, executor, administrator, agent, trustee, guardian, or custodian for a minor, please give full title as such. If a corporation, please sign in full corporate name by an authorized person. If a partnership, please sign in partnership name by an authorized person.
THE PHOENIX EDGE SERIES FUND
These proposals are discussed in detail in the attached Proxy Statement. The Board of Trustees of The Phoenix Edge Series Fund (the "Trust") is soliciting the enclosed proxy. As a convenience, you can now vote in any one of four ways:
| | • | Through the Internet at www.proxyweb.com; |
| | • | By telephone, with a toll-free call to the Trust's proxy tabulator, at 1-800-690-6903; |
| | • | By mail, using the enclosed Voting Instructions Card(s) and postage paid envelope; or |
| | • | In person at the Special Meeting. |
We encourage you to vote by Internet or telephone, using the control number that appears at left. These voting methods will reduce the time and costs associated with this proxy solicitation. Whichever method you choose please read the enclosed proxy statement before you vote.
PLEASE RESPOND - IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK THAT YOU VOTE PROMPTLY. YOUR VOTE IS IMPORTANT.
The undersigned shareholder of Phoenix-Lazard Small-Cap Value Series (the "Phoenix Portfolio"), a series of the Trust, hereby appoints Matthew A. Swendiman and Philip K. Polkington and any and each of them, proxies of the undersigned, with power of substitution to each, for and in the name of the undersigned to vote and act upon all matters (unless and except as expressly limited below) at the Special Meeting of Shareholders of the Phoenix Portfolio to be held on Thursday, April 26, 2005, at One American Row, Hartford, Connecticut, notice of which meeting and the Proxy Statement accompanying the same have been received by the undersigned, or at any and all adjournments or postponements thereof, with respect to all shares of the Phoenix Portfolio for which the undersigned is entitled to vote or with respect to which the undersigned would be entitled to vote or act, with all the powers the undersigned would possess if personally present voting with respect to the specific matters set forth below. Any proxies heretofore given by the undersigned with respect to said meeting are hereby revoked.
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES OF THE TRUST WHO RECOMMEND A VOTE "FOR" EACH OF THE PROPOSALS.
Specify desired action by check mark in the appropriate space. In the absence of such specification, the persons named as proxies have discretionary authority, which they intend to exercise by voting shares represented by this proxy in favor of each of the proposals.
Please fill in box(es) as shown using black or blue ink or number 2 pencil. Please do not use fine point pens. [X]
Name of Series: Phoenix-Lazard Small-Cap Value Series
| Proposal 1: | To approve an Agreement and Plan of Reorganization providing for the transfer of all assets and stated liabilities of the Phoenix-Lazard Small-Cap Value Series in exchange for shares of Lazard Retirement Small Cap Portfolio, and the shares so received will be distributed to shareholders of the Phoenix-Lazard Small-Cap Value Series. |
[ ] For [ ] Against [ ] Abstain
| Proposal 2: | To consider and act upon any other business as may properly come before the meeting and any adjournments thereof. |
[ ] For [ ] Against [ ] Abstain
PLEASE MARK, SIGN, DATE AND RETURN THE VOTING INSTRUCTIONS CARD PROMPTLY USING THE ENCLOSED ENVELOPE. BY SIGNING THIS PROXY CARD, RECEIPT OF THE ACCOMPANYING NOTICE OF SPECIAL MEETING AND PROXY STATEMENT IS ACKNOWLEDGED.
_____________________________________ _____________________________________
Signature of Participant Date Signature of Joint Owner(s) Date
PLEASE DATE AND SIGN EXACTLY AS YOUR NAME APPEARS HEREON. CORPORATE PROXIES SHOULD BE SIGNED BY AN AUTHORIZED OFFICER.
LAZARD RETIREMENT SERIES, INC.
PART C
OTHER INFORMATION
All references to the "Registration Statement" are to Post-Effective Amendment No. 14 to the Registrant's Registration Statement on Form N-1A, filed December 3, 2004 (File No. 333-22309) (the "Registration Statement") unless otherwise noted.
| | The response to this item is incorporated by reference to Item 24 of Part C of Post-Effective Amendment No. 14 to the Registration Statement. |
| (1)(a) | Registrant's Articles of Incorporation are incorporated by reference to Exhibit (1)(a) to Pre-Effective Amendment No. 1 to the Registrant's Registration Statement filed with the Securities and Exchange Commission (the "SEC") on May 19, 1997. |
| (1)(b) | Registrant's Articles of Amendment are incorporated by reference to Exhibit (1)(b) to Pre-Effective Amendment No. 1 to the Registrant's Registration Statement filed with the SEC on May 19, 1997. |
| (1)(c) | Registrant's Articles Supplementary are incorporated by reference to Exhibit (a)(3) to Post-Effective Amendment No. 9 to the Registrant's Registration Statement filed with the SEC on April 30, 2001. |
| (1)(d) | Registrant's Articles Supplementary are incorporated by reference to Exhibit (a)(4) to the Registration Statement. |
| (2) | Registrant's By-Laws, as amended are incorporated by reference to Exhibit (b) to Post-Effective Amendment No. 13 to the Registrant's Registration Statement filed with the SEC on October 15, 2004. |
| (4) | Agreement and Plan of Reorganization (filed as part of the Prospectus/Proxy Statement) |
| (5) | Reference is made to Exhibits (1) and (2) hereof. |
| (6) | Investment Management Agreements are incorporated by reference to Exhibit (d) to the Registration Statement. |
| (7)(a) | Distribution Agreement, as revised is incorporated by reference to Exhibit (e) to the Registration Statement. |
| (9) | Custodian Contract is incorporated by reference to Exhibit (g) to Post-Effective Amendment No. 11 to the Registrant's Registration Statement filed with the SEC on April 30, 2003. |
| (10)(a) | Distribution and Servicing Plan, as revised is incorporated by reference to Exhibit (m)(1) to the Registration Statement. |
| (10)(b) | Form of Distribution and Servicing Plan Agreement is incorporated by reference to Exhibit (m)(2) to the Registration Statement. |
| (12) | Opinion and consent of counsel regarding tax matters.** |
| (13)(a) | Administration Agreement is incorporated by reference to Exhibit (h)(2) to Pre-Effective Amendment No. 1 to the Registrant's Registration Statement filed with the SEC on May 19, 1997. |
| (13)(b) | Form of Fund Participation Agreement, as revised is incorporated by reference to Exhibit (h)(2) to the Registration Statement. |
| (13)(c) | Transfer Agency and Service Agreement is incorporated by reference to Exhibit (h)(3) to Post-Effective Amendment No. 11 to the Registrant's Registration Statement filed with the SEC on April 30, 2003. |
| (14)(a) | Consent of Independent Registered Public Accounting Firm of Registrant.* |
| (14)(b) | Consent of Independent Registered Public Accounting Firm.* |
| (16) | Power of Attorney.*** |
| (17)(b) | Registrant's Prospectus and Statement of Additional Information dated May 1, 2004 are incorporated by reference to the Registration Statement. |
__________________________________
| ** | To be filed by amendment. |
| *** | Filed as part of signature page to Registrant's Registration Statement on Form N-14 (File No. 333-122944) filed with the SEC on February 22, 2005. |
| (1) | The undersigned Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this registration statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
| (2) | The undersigned Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the registration statement and will not be used until the amendment is effective, and that, in determining any liability under the Securities Act of 1933 each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them. |
SIGNATURES
As required by the Securities Act of 1933, this Registration Statement has been signed on behalf of the Registrant, in the City of New York, and State of New York on the 24th day of March, 2005.
| LAZARD RETIREMENT SERIES, INC.
By: /s/ Charles Carroll
Charles Carroll, Chief Executive Officer |
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following p-erson in the capacities and on the dates indicated.
/s/ Charles Carroll
Charles Carroll | President and Director | March 24, 2005 |
/s/ Stephen St. Clair
Stephen St. Clair | Treasurer and Chief Financial Officer | March 24, 2005 |
/s/ Norman Eig
Norman Eig | Director | March 24, 2005 |
/s/ John J. Burke*
John J. Burke | Director | March 24, 2005 |
/s/ Lester Z. Lieberman*
Lester Z. Lieberman | Director | March 24, 2005 |
/s/ Richard Reiss, Jr.*
Richard Reiss, Jr. | Director | March 24, 2005 |
Kenneth S. Davidson*
Kenneth S. Davidson | Director | March 24, 2005 |
/s/ William Katz
William Katz | Director | March 24, 2005 |
/s/ Robert M. Solmson*
Robert M. Solmson | Director | March 24, 2005 |
/s/ Nathan A. Paul
Attorney-in-fact, Nathan A. Paul | | |
