UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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The Phoenix Edge Series Fund
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(Name of Registrant As Specified In Its Charter)
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THE PHOENIX EDGE SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
August 1, 2006
Dear Policy or Contract Owner:
Effective April 30, 2006, Phoenix Investment Counsel, Inc. ("PIC") was
terminated as investment advisor to The Phoenix Edge Series Fund (the "Fund") on
behalf of four series of the Fund: Phoenix-S&P Dynamic Asset Allocation Series:
Aggressive Growth, Phoenix-S&P Dynamic Asset Allocation Series: Growth,
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth, and Phoenix-S&P
Dynamic Asset Allocation Series: Moderate (collectively, "S&P Dynamic Series").
Effective May 1, 2006, Phoenix Variable Advisors, Inc. ("PVA") assumed
investment advisory responsibility from PIC for each S&P Dynamic Series. On
April 30, 2006, PIC terminated its subadvisory agreement with Standard & Poor's
Investment Advisory Services LLC ("S&P") and PVA entered into a new subadvisory
agreement with S&P.
Effective April 30, 2006, Engemann Asset Management ("EAM") was
terminated as the investment advisor to the Fund on behalf of the
Phoenix-Engemann Value Equity Series ("Engemann Value Equity"). Effective May 1,
2006, Phoenix Variable Advisors, Inc. ("PVA") assumed investment advisory
services on behalf of the Phoenix-Engemann Value Equity Series. Furthermore, PVA
entered into a subadvisory agreement with Morgan Stanley Investment Management
Inc. d/b/a Van Kampen ("Van Kampen") and assumed subadvisory responsibility for
the series effective May 1, 2006. On the same day the name of the series changed
from Engemann Value Equity to Phoenix-Van Kampen Comstock Series ("Van Kampen
Comstock").
PVA and the Fund have been granted an exemptive order (the "Order")
from the Securities and Exchange Commission ("SEC") that permits PVA and the
Fund to have the right to hire, terminate, and replace subadvisors without
shareholder approval, including, without limitation, the replacement or
reinstatement of any subadvisor with respect to which a subadvisory agreement
has automatically terminated as a result of an assignment. PVA has the ultimate
responsibility to oversee subadvisors and recommend their hiring, termination,
and replacement.
Some or the entire variable portion of your variable life insurance
policy or your variable annuity contract, issued by Phoenix Life Insurance
Company ("PLIC"), PHL Variable Insurance Company ("PHL Variable"), or Phoenix
Life and Annuity Company ("PLAC") (collectively, "Phoenix") and their separate
accounts, was invested in shares of Van Kampen Comstock and/or S&P Dynamic
Series. As a condition of the Order, PVA and the Fund must provide you with the
enclosed Information Statement to update you as to the subadvisory changes.
If you should have any questions regarding these changes, please feel
free to call Phoenix Variable Products Customer Service at (800) 541-0171. Thank
you for your continued investment in The Phoenix Edge Series Fund.
Sincerely,
/s/ Philip K. Polkinghorn
Philip K. Polkinghorn
President
INFORMATION STATEMENT
THE PHOENIX EDGE SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
The Phoenix Edge Series Fund (the "Fund") serves as an investment
option for use in connection with variable life insurance policies and variable
annuity contracts (collectively, "Contracts") issued by Phoenix Life Insurance
Company ("PLIC"), PHL Variable Insurance Company ("PHL Variable") and Phoenix
Life and Annuity Company ("PLAC") (collectively, "Phoenix") and their separate
accounts. Phoenix and the separate accounts are the sole shareholders of record
of the Fund. Some or the entire variable portion of your Contract, issued by
Phoenix, is invested in shares of the Fund.
The Fund is an open-end management investment company (commonly
referred to as a mutual fund) registered with the Securities and Exchange
Commission ("SEC") under the Investment Company Act of 1940, as amended ("1940
Act"). The Fund had 26 separate investment portfolios, including the
Phoenix-Engemann Value Equity Series (the "Engemann Value Equity"), Phoenix-S&P
Dynamic Asset Allocation Series: Aggressive Growth, Phoenix-S&P Dynamic Asset
Allocation Series: Growth, Phoenix-S&P Dynamic Asset Allocation Series: Moderate
Growth, and Phoenix-S&P Dynamic Asset Allocation Series: Moderate (collectively
the "S&P Dynamic Series") as of April 1, 2006. Engemann Asset Management ("EAM")
and Phoenix Investment Counsel, Inc. ("PIC"), Phoenix affiliates, act as
investment advisors to the Engemann Value Equity and S&P Dynamic Series,
respectively. EAM's principal place of business is located at 600 North Rosemead
Blvd., Pasadena, CA 91107. PIC's principal place of business is located at 56
Prospect Street, Hartford, CT 06115.
Effective May 1, 2006, Phoenix Variable Advisors, Inc. ("PVA") assumed
investment advisory responsibility from EAM and retained Morgan Stanley
Investment Management Inc., d/b/a Van Kampen ("Van Kampen") as the new
subadvisor for Engemann Value Equity. In connection with the change in
subadvisor, the name of Phoenix-Engemann Value Equity Series was changed to
Phoenix-Van Kampen Comstock Series ("Van Kampen Comstock"). PVA's principal
place of business is located at One American Row, Hartford, CT 06103. Van
Kampen's principal place of business is located at 1221 Avenue of the Americas,
New York, New York 10020.
Also on May 1, 2006, PVA assumed investment advisory responsibility
from PIC on behalf of S&P Dynamic Series. PVA also entered into a new
subadvisory agreement with Standard & Poor's Investment Advisory Services, LLC
("S&P") replacing PIC in the subadvisory agreement. PVA's principal place of
business is located at One American Row, Hartford, CT 06103. S&P's principal
place of business is located at 55 Water Street, New York, NY 10041.
PVA and the Fund have been granted an exemptive order (the "Order")
from the SEC that permits PVA and the Fund to have the right to hire, terminate,
and replace subadvisors without shareholder approval, including, without
limitation, the replacement or reinstatement of any subadvisor with respect to
which a subadvisory agreement has automatically terminated as a result of an
assignment. PVA has the ultimate responsibility to oversee subadvisors and
recommend their hiring, termination, and replacement. As a condition of the
Order, PVA and the Fund must provide you with this Information Statement to
update you as to these subadvisory changes. More information about the Order is
provided below. This Information Statement is being sent to shareholders on or
about August 1, 2006.
WE ARE NOT SOLICITING YOUR VOTE. NO PROXY VOTING CARD HAS BEEN
ENCLOSED. WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY.
At a regular meeting of the Fund's board of trustees (the "Board") held
March 21-22, 2006, Management of the Fund ("Management") proposed for S&P
Dynamic Series to: (1) terminate the investment advisory agreement between the
Fund and PIC as the investment advisor; (2) enter into a new investment advisory
agreement between the Fund and PVA; (3) terminate the subadvisory agreement
between PIC and S&P; and (4) approve a new subadvisory agreement between PVA and
S&P for S&P Dynamic Series.
At the same meeting of the Fund's Board, Management also proposed for
Engemann Value Equity to: (1) terminate EAM as investment advisor; (2) change
the investment advisory agreement from EAM to PVA on behalf of Engemann Value
Equity; (3) retain Van Kampen as the subadvisor for the Engemann Value Equity
and approve a new subadvisory agreement; and (4) change the name of the
Phoenix-Engemann Value Equity Series to Phoenix-Van Kampen Comstock Series.
The foregoing transactions were approved by all trustees of the Board,
including a majority of the trustees who are not "interested persons" (within
the meaning of the 1940 Act) of the Fund ("Disinterested Trustees").
THE TRANSACTION
---------------
The transactions have several steps:
On May 1, 2006 for S&P Dynamic Series:
o PIC is terminated effective April 30, 2006 as the investment
advisor;
o An investment advisory agreement between PVA and the Fund is
effective;
o The subadvisory agreement between PIC and S&P is terminated; and
o A new subadvisory agreement between PVA and S&P for S&P Dynamic
Series is effective.
On May 1, 2006 for Van Kampen Comstock:
o EAM is terminated effective April 30, 2006 as the investment
advisor;
o An investment advisory agreement between PVA and the Fund is
effective;
o Van Kampen is retained as subadvisor, and a new subadvisory
agreement between PVA and Van Kampen for Engemann Value Equity is
effective; and
o The name of the Phoenix-Engemann Value Equity Series is changed
to Phoenix Van Kampen Comstock Series.
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Copies of the investment advisory agreements and subadvisory agreements
are attached as Exhibits A, B, C, and D.
Pursuant to the Order received from the SEC, PVA and the Fund have the
right to hire, terminate, and replace subadvisors without shareholder approval,
including, without limitation, the replacement or reinstatement of any
subadvisor with respect to which a subadvisory agreement has automatically
terminated as a result of an assignment. PVA has the ultimate responsibility to
oversee subadvisors and recommend their hiring, termination, and/or replacement.
Contractholders and policyowners who have directed the allocation of their
investment to a subaccount corresponding to the Engemann Value Equity and S&P
Dynamic Series have received this Information Statement, and may elect to
transfer their investment into any other subaccount available through their
Contracts without any restrictions on the transfer.
THE OLD ADVISORY AGREEMENTS
---------------------------
S&P DYNAMIC SERIES
S&P Dynamic Series was added to the Fund effective December 5, 2005.
PIC served as the investment advisor on behalf of S&P Dynamic Series until April
30, 2006. PIC received a fee of 0.40% of the average daily net assets for each
of the respective S&P Dynamic Series. From inception date to April 30, 2006, the
advisory fee paid to PIC by the Fund on behalf of (a) Phoenix-S&P Dynamic Asset
Allocation Series: Aggressive Growth was $775.71, (b) Phoenix-S&P Dynamic Asset
Allocation Series: Growth was $1,240.46, (c) Phoenix-S&P Dynamic Asset
Allocation Series: Moderate was $393.10, and (d) Phoenix-S&P Dynamic Asset
Allocation Series: Moderate Growth was $660.48.
ENGEMANN VALUE EQUITY (N/K/A VAN KAMPEN COMSTOCK)
EAM served as the investment advisor to Engemann Value Equity until
April 30, 2006. Under the old investment advisory agreement, EAM received a fee
of 0.70% of the average daily net assets up to the first $250 million; 0.65% of
the average daily net assets on $250 million to $500 million; 0.60% of the
average daily net assets on the excess over $500 million. From January 1, 2006
to April 30, 2006, the advisory fee paid to EAM by the Fund on behalf of
Engemann Value Equity was $247,580.27.
ADDITIONAL INFORMATION ON THE OLD ADVISORY AGREEMENTS
ENGEMANN VALUE EQUITY (N/K/A VAN KAMPEN COMSTOCK)
Under the Old Advisory Agreement, EAM provided investment advisory
services to Engemann Value Equity (n/k/a Van Kampen Comstock), including making
decisions regarding the acquisition, holding or disposition of securities or
other assets that Engemann Value Equity may have owned or contemplated acquiring
from time to time. All services under the Old Advisory Agreement must have been
provided in accordance with the Fund's Declaration of Trust, as amended, any
policies adopted by the Board, and the investment policies of Engemann Value
Equity as disclosed in the Fund's registration statement on file with the SEC,
as amended from time to time.
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EAM had the exclusive authority to manage the investment and
reinvestment of the assets of Engemann Value Equity, subject to the discretion
and control of the Fund and the Board. EAM provided an investment program to
Engemann Value Equity consistent with Engemann Value Equity investment
objectives based upon the development, review and adjustment of the investment
policies approved from time to time by the Board and the Fund in consultation
with EAM. EAM agreed to use its best professional judgment to make investment
decisions for Engemann Value Equity in accordance with the terms of the
investment advisory agreement.
Unless instructed otherwise by the Fund, EAM placed all orders for the
purchase and sale of investments for Engemann Value Equity with brokers or
dealers selected by EAM. EAM used its best efforts to obtain the best execution
of transactions at prices that were advantageous to Engemann Value Equity and at
commission rates that were reasonable in relation to the benefits received. EAM
may have selected brokers or dealers on the basis that they provided brokerage,
research, or other services or products to a series or other accounts serviced
by EAM. EAM may have placed transactions with a broker or dealer with whom it
had negotiated a commission in excess of the commission another broker or dealer
would have charged for effecting that transaction if EAM determined in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research provided by the broker or dealer, viewed in terms of
either that particular transaction or on all such transactions, taken as a
whole, for Engemann Value Equity and other accounts over which EAM exercised
investment discretion. Not all services or products provided by brokers or
dealers that were generated with Engemann Value Equity commissions were
necessarily used by EAM in managing the Engemann Value Equity, but may have been
allocated among other accounts.
The Old Advisory Agreement between the Fund and EAM remained in full
force and effect only so long as its continuance had been specifically approved
at least annually by the Trustees in accordance with Section 15(a) of the 1940
Act, and by the majority vote of the Disinterested Trustees in accordance with
the requirement of Section 15(c). The Old Advisory Agreement may be terminated
by either party, without penalty, immediately upon sixty (60) days' written
notice to the other party, but any such termination shall not affect the status,
obligations or liabilities of either party. The Old Advisory Agreement was last
considered and renewed by the Board during its regular meeting on November 13,
2005. Notice was given to EAM of its termination as advisor effective April 30,
2006.
S&P DYNAMIC SERIES
Under the Old Advisory Agreement, PIC provided investment advisory
services to S&P Dynamic Series including making decisions regarding the
acquisition, holding or disposition of securities or other assets that S&P
Dynamic Series may have owned or contemplated acquiring from time to time. All
services under the Old Advisory Agreement must have been provided in accordance
with the Fund's Declaration of Trust, as amended, any policies adopted by the
Board, and the investment policies of S&P Dynamic Series as disclosed in the
Fund's registration statement on file with the SEC, as amended from time to
time.
PIC had the exclusive authority to manage the investment and
reinvestment of the assets of S&P Dynamic Series, subject to the discretion and
control of the Fund and the Board. PIC
4
provided an investment program to S&P Dynamic Series consistent with S&P Dynamic
Series investment objectives based upon the development, review and adjustment
of the investment policies approved from time to time by the Board and the Fund
in consultation with PIC. PIC agreed to use its best professional judgment to
make investment decisions for S&P Dynamic Series in accordance with the terms of
the former advisory agreement.
Unless instructed otherwise by the Fund, PIC placed all orders for the
purchase and sale of investments for S&P Dynamic Series with brokers or dealers
selected by PIC. PIC used its best efforts to obtain the best execution of
transactions at prices that were advantageous to S&P Dynamic Series and at
commission rates that were reasonable in relation to the benefits received. PIC
may have selected brokers or dealers on the basis that they provide brokerage,
research, or other services or products to a series or other accounts serviced
by PIC. PIC may have placed transactions with a broker or dealer with whom it
had negotiated a commission in excess of the commission another broker or dealer
would have charged for effecting that transaction if PIC had determined in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research provided by the broker or dealer, viewed in terms of
either that particular transaction or on all such transactions, taken as a
whole, for S&P Dynamic Series and other accounts over which PIC exercised
investment discretion. Not all services or products provided by brokers or
dealers that were generated with S&P Dynamic Series commissions were necessarily
used by PIC in managing S&P Dynamic Series, but may have been allocated among
other accounts.
The Old Advisory Agreement between the Fund and PIC remained in full
force and effect only so long as its continuance had been specifically approved
at least annually by the Trustees in accordance with Section 15(a) of the 1940
Act, and by the majority vote of the Disinterested Trustees in accordance with
the requirement of Section 15(c). The Old Advisory Agreement may be terminated
by either party, without penalty, immediately upon sixty (60) days' written
notice to the other party, but any such termination shall not affect the status,
obligations or liabilities of either party. The Old Advisory Agreement was last
considered and renewed by the Board during its regular meeting on November 13,
2005. Notice was given to PIC of its termination as advisor effective April 30,
2006.
THE NEW ADVISORY AGREEMENTS
---------------------------
On May 1, 2006, PVA entered into a new advisory agreement with the Fund
on behalf of S&P Dynamic Series. Concurrently, on May 1, 2006 PVA also entered
into a new advisory agreement with the Fund on behalf of Van Kampen Comstock.
Except as to the effective date and the investment advisor, the material terms
of both New Advisory Agreements are substantially similar to those of the Old
Advisory Agreements. There is no increase in the investment advisory fees paid
by the series as a result of the Fund entering into the New Advisory Agreements.
ADDITIONAL INFORMATION ABOUT THE NEW ADVISORY AGREEMENTS
S&P DYNAMIC SERIES
PVA replaced PIC as the investment advisor to the four S&P Dynamic
Series effective May 1, 2006. PVA will receive the same fee as PIC under the Old
Advisory Agreement. From
5
May 1, 2006 to June 30, 2006, the advisory fee paid to PVA by the Fund on behalf
of (a) Phoenix-S&P Dynamic Asset Allocation Series: Aggressive Growth was
$2,816.57, (b) Phoenix-S&P Dynamic Asset Allocation Series: Growth was
$3,608.45, (c) Phoenix-S&P Dynamic Asset Allocation Series: Moderate was
$682.31, and (d) Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth
was $1,552.62. A copy of the New Investment Advisory Agreement between the Fund
and PVA regarding the S& P Dynamic Series is attached as Exhibit A.
ENGEMANN VALUE EQUITY (N/K/A VAN KAMPEN COMSTOCK)
PVA replaced EAM as the investment advisor to Engemann Value Equity
effective May 1, 2006. Under the new investment advisory agreement, PVA will
receive the same fee as PIC under the Old Advisory Agreement. From May 1, 2006
to June 30, 2006 the advisory fee paid by the Fund to PVA on behalf of Engemann
Value Equity was $123,125.08. A copy of the New Investment Advisory Agreement
between the Fund and PVA regarding Van Kampen Comstock is attached as Exhibit B.
THE NEW SUBADVISORY AGREEMENTS
------------------------------
PVA, on behalf of S&P Dynamic Series, entered into a new subadvisory
agreement with S&P. The new subadvisory agreement is dated May 1, 2006. Except
as to the effective date and the investment advisor, the material terms of the
New Subadvisory Agreement are substantially similar to those of the respective
Old Subadvisory Agreement. There is no increase in the investment subadvisory
fees paid by PVA on behalf of the four series as a result of the New Subadvisory
Agreement. A copy of the New Subadvisory Agreement between PVA and S&P is
attached as Exhibit C.
PVA, on behalf of Van Kampen Comstock, entered into a new subadvisory
agreement with Van Kampen. The new subadvisory agreement is dated May 1, 2006.
Prior to May 1, 2006, Van Kampen Comstock (f/k/a Engemann Value Equity) was
advised by EAM, a Phoenix affiliate, which did not appoint a subadvisor. Van
Kampen is paid a subadvisory fee from the investment advisor, which was not
contemplated by the prior investment management arrangement. There is no
increase in the investment subadvisory fees paid by the Advisor on behalf of Van
Kampen Comstock as a result of the new subadvisory agreement. A copy of the New
Subadvisory Agreement between PVA and Van Kampen is attached as Exhibit D.
S&P DYNAMIC SERIES
The New Subadvisory Agreement between PVA and S&P on behalf of S&P
Dynamic Series is dated May 1, 2006. Under the subadvisory agreement, S&P
receives an annual fee of 0.12% of the average aggregate daily net asset value
of S&P Dynamic Series. The subadvisory fee is not charged directly to S&P
Dynamic Series; the subadvisor is paid directly by PVA from its advisory fee.
The advisory fee paid to PVA by the Fund is at an annual rate of 0.40% of the
average daily net assets of S&P Dynamic Series, excluding the net assets
representing capital contributed by PLIC. From May 1, 2006 to June 30, 2006, the
subadvisory fee paid to S&P was $2,597.99.
6
VAN KAMPEN COMSTOCK (F/K/A ENGEMANN VALUE EQUITY)
The New Subadvisory Agreement between PVA and Van Kampen is dated May
1, 2006. Under the New Subadvisory Agreement, Van Kampen receives an annual fee
of 0.35% of the average daily net asset value of Van Kampen Comstock. The
subadvisory fee is not charged directly to Van Kampen Comstock; the subadvisor
is paid directly by PVA from its advisory fee, which is at an annual rate of
0.70% on the first $250 million of assets; 0.65% on the next $250 million of
assets; and 0.60 % on all assets in excess of $500 million. From May 1, 2006 to
June 30, 2006 the subadvisory fee paid to Van Kampen was $61,562.54.
ADDITIONAL INFORMATION ON THE NEW SUBADVISORY AGREEMENT FOR S&P DYNAMIC
SERIES
The New Subadvisory Agreement for S&P Dynamic Series furnishes
portfolio management services for S&P Dynamic Series. S&P will provide
investment subadvisory services to S&P Dynamic Series, including making
recommendations to PVA regarding the acquisition, holding or disposition of
securities or other assets that S&P Dynamic Series may own or contemplate
acquiring from time to time. All services under the New Subadvisory Agreement
for S&P Dynamic Series must be provided in accordance with the Fund's
Declaration of Trust, as amended, any policies adopted by the Board, and the
investment policies of S&P Dynamic Series as disclosed in the Fund's
registration statement on file with the SEC, as amended from time to time.
S&P will have the authority to make recommendations to PVA for the
management of the investment and reinvestment of the assets of S&P Dynamic
Series, subject to the discretion and control of PVA and the Board. S&P will
provide an investment program for S&P Dynamic Series consistent with the Series'
investment objectives based upon the development, review and adjustment of
investment policies approved from time to time by the Board and PVA in
consultation with S&P. S&P has agreed to use its best professional judgment to
make investment recommendations for S&P Dynamic Series in accordance with the
terms of the New Subadvisory Agreement for S&P Dynamic Series.
The New Subadvisory Agreement for S&P Dynamic Series will remain in
full force and effect until a (60) sixty days written notice of termination is
given to either party, and thereafter only so long as its continuance has been
specifically approved at least annually by the Board in accordance with Section
15(a) of the 1940 Act, and by the majority vote of the Disinterested Trustees of
the Board in accordance with Section 15(c).
ADDITIONAL INFORMATION ON THE NEW SUBADVISORY AGREEMENT FOR VAN KAMPEN
COMSTOCK
The New Subadvisory Agreement for Van Kampen Comstock furnishes
portfolio management services to Van Kampen Comstock. Van Kampen, will provide
investment subadvisory services to Van Kampen Comstock, including making
decisions regarding the acquisition, holding or disposition of securities or
other assets that Van Kampen Comstock may own or contemplate acquiring from time
to time. All services under the New Subadvisory Agreement must be provided in
accordance with the Fund's Declaration of Trust, as amended,
7
any policies adopted by the Board, and the investment policies of Van Kampen
Comstock as disclosed in the Fund's registration statement on file with the SEC,
as amended from time to time.
Van Kampen will have the exclusive authority to manage the investment
and reinvestment of the assets of Van Kampen Comstock (f/k/a Engemann Value
Equity), subject to the discretion and control of PVA and the Board. Van Kampen
will provide an investment program for Van Kampen Comstock consistent with Van
Kampen Comstock's investment objectives based upon the development, review and
adjustment of investment policies approved from time to time by the Board and
PVA in consultation with Van Kampen. Van Kampen has agreed to use its best
professional judgment to make investment decisions and provide related services
for Van Kampen Comstock in accordance with the terms of the New Subadvisory
Agreement for Van Kampen Comstock.
This New Subadvisory Agreement will remain in full force and effect
until a (60) sixty days written notice of termination is given to either party,
and thereafter only so long as its continuance has been specifically approved at
least annually by the Board in accordance with Section 15(a) of the 1940 Act,
and by the majority vote of the Disinterested Trustees of the Board in
accordance with Section 15(c).
Unless instructed otherwise by PVA, Van Kampen will place all orders
for the purchase and sale of investments for Van Kampen Comstock with brokers or
dealers selected by Van Kampen. Van Kampen will use its best efforts to obtain
the best execution of transactions at prices that are advantageous to Van Kampen
Comstock and at commission rates that are reasonable in relation to the benefits
received. Van Kampen may select brokers or dealers on the basis that they
provide brokerage, research, or other services or products to a series or other
accounts serviced by Van Kampen. Van Kampen may place 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
Van Kampen determines in good faith that such amount of commission is reasonable
in relation to the value of the brokerage and research provided by the broker or
dealer, viewed in terms of either that particular transaction or on all
transactions, taken as a whole, for Van Kampen Comstock and other accounts over
which Van Kampen exercises investment discretion. Not all services or products
provided by brokers or dealers that are generated with Van Kampen Comstock
commissions will necessarily be used by Van Kampen in managing Van Kampen
Comstock, but may be allocated among other accounts.
BOARD'S CONSIDERATIONS
----------------------
S&P DYNAMIC SERIES
At a regular meeting held on March 21, 2006, the Board, including a
majority of the Disinterested Trustees, approved the termination of PIC as the
investment advisor, approved the appointment of PVA as the investment advisor,
and approved the subadvisory agreement between PIC and S&P.
In connection with the consideration of replacing PIC with PVA as
advisor to S & P Dynamic Series, the Board considered the questionnaire that had
previously been completed
8
concerning its oversight philosophy of subadvisors, resources, operations and
compliance structure. In addition, the Board considered PVA's extensive
supervisory investment experience in overseeing subadvisors for the series of
the Fund. The Board concluded that the nature, extent and quality of the overall
services that are provided by the advisor were reasonable.
In connection with the consideration of Management's proposal for the
Board to approve the subadvisory agreement between PVA and S&P, the Board
considered its original approval of the subadvisory agreement between PIC and
S&P at the Special Board meeting on December 5, 2005. In addition, the Board
reexamined S&P's investment philosophy, resources, operations and compliance
structure based on an extensive questionnaire completed by S&P. The Trustees
also considered the overall nature, extent, and quality of the services to be
provided by the subadvisor, whether the cost to PVA of these services would be
reasonable, and the economic viability of S&P. The Board concluded that the
nature, extent and quality of the overall services of S&P to the S&P Dynamic
Series and its shareholders were reasonable.
Because the overall investment advisory fee would not be changing and
the subadvisory fee would be paid by PVA (not the Series), the Board did not
rely upon comparisons of the services rendered and the amounts to be paid under
the New Subadvisory Agreement with other agreements of similar funds or other
types of accounts. For the same reason, the Board also did not consider S&P's
profitability with regard to the Series or economics of scale during its
deliberations.
After considering all the information presented, based on the
qualifications of S&P's personnel, the Board concluded that the nature, quality
and cost of services to be provided to the Series by the subadvisor were
reasonable and fair, and in the best interest of the Series and their
shareholders and approved the proposal.
VAN KAMPEN COMSTOCK (F/K/A ENGEMANN VALUE EQUITY)
At a regular meeting held on March 21, 2006, the Board, including a
majority of the Disinterested Trustees, approved the termination of EAM as the
investment advisor, approved the appointment of PVA as the investment advisor,
and approved the proposal by PVA to appoint Van Kampen as subadvisor to Engemann
Value Equity. The Board also approved renaming Phoenix-Engemann Value Equity
Series to Phoenix-Van Kampen Comstock Series.
In connection with the consideration of replacing EAM with PVA as
advisor to Van Kampen Comstock, the Board considered the questionnaire that had
previously been completed concerning its oversight philosophy of subadvisors,
resources, operations and compliance structure. In addition, the Board
considered PVA's extensive supervisory investment experience in overseeing
subadvisors for the series of the Fund.
In connection with the consideration of PVA's proposal to appoint Van
Kampen as subadvisor to Van Kampen Comstock, the Board received in advance of
the meeting, certain information in the form of an extensive questionnaire
completed by Van Kampen concerning a number of issues including its investment
philosophy, resources, operations and compliance structure. The Board had
further benefit of a presentation made by Van Kampen's senior
9
management personnel where a number of issues, including Van Kampen's history,
investmentapproach, investment strategies, portfolio turnover rates, assets
under management, personnel, and the firm's overall performance, were reviewed
and discussed.
In addition, the Trustees also considered the overall nature, extent,
and quality of the services to be provided by the subadvisor, whether the cost
to PVA of these services would be reasonable, and the economic viability of Van
Kampen. The Board concluded that the nature, extent and quality of the overall
services that are provided by Van Kampen to Van Kampen Comstock and its
shareholders were reasonable.
Because the overall investment advisory fee would not be changing and
the subadvisory fee would be paid by PVA (not the Series), the Board did not
rely upon comparisons of the services rendered and the amounts to be paid under
the New Subadvisory Agreement with other agreements of other similar funds or
other types of accounts. For the same reason, the Board also did not consider
Van Kampen's profitability with regard to the Series or economics of scale
during its deliberations.
After considering all the information presented, based on the
qualifications of Van Kampen's personnel, and the performance of assets managed
by the subadvisor in a similar manner as the Series would be managed, the Board
concluded that the nature, quality and cost of services to be provided to the
Series by the subadvisor were reasonable and fair, and in the best interest of
the Series and their shareholders and approved the proposal.
THE EXEMPTIVE ORDER
-------------------
The Fund and PVA filed an application on September 26, 2001, and an
amendment to the application on July 9, 2002, requesting an order under Section
6(c) of the 1940 Act granting an exemption from Section 15(a) of the 1940 Act
and Rule 18f-2 under the 1940 Act. The Order would permit the Fund and PVA to
enter into and materially amend subadvisory agreements without shareholder
approval.
On July 10, 2002, a notice of the filing of the application was issued
(Investment Company Act Release No. 25655). The notice gave interested persons
an opportunity to request a hearing and stated that an order granting the
application would be issued unless a hearing was ordered. No request for a
hearing had been filed, and the SEC did not order a hearing.
The SEC considered the matter and found, on the basis of the
information set forth in the application, as amended, that granting the
requested exemption was appropriate in the public interest and consistent with
the protection of investors and the purposes fairly intended by the policy and
provisions of the 1940 Act. Therefore, pursuant to the Investment Company Act
Release No. 25693 received from the SEC, PVA and the Fund could, with prior
approval of the Board, be permitted to enter into and materially amend
subadvisory agreements without such agreements being approved by the
shareholders of the Fund. The Fund and PVA have the right to hire, terminate,
and replace subadvisors without shareholder approval, including, without
limitation, the replacement or reinstatement of any subadvisor with respect to
which a subadvisory agreement has automatically terminated as a result of an
assignment. PVA has the ultimate responsibility to oversee subadvisors and
recommend their hiring, termination, and replacement.
10
DISCLOSURE REGARDING VOTING SECURITIES
--------------------------------------
The shares of the Fund are not offered directly to the public. Shares
of the Fund currently are offered to certain separate accounts in order to fund
variable accumulation annuity Contracts or variable life insurance policies
issued by PLIC, PHL Variable and PLAC and their separate accounts. Investments
in the Fund may occur only by purchasing a Contract and directing the allocation
of your purchase payment(s) to the subaccount(s) corresponding to a series. The
subaccounts, in turn, invest in shares of the Fund. Not all series may be
offered through a particular Contract. No one person (including any "group" as
that term is used in Section 13(d)(3) of the Exchange Act) owns beneficially of
record 5% or more of the outstanding shares of the Fund. Outstanding shares of
beneficial interest of the Fund beneficially owned under a Contract or policy by
the Trustees or the executive officers of the Fund, as a group, is less than 1%.
ADDITIONAL INFORMATION
----------------------
PVA, the investment advisor on behalf of S&P Dynamic Series and Van
Kampen Comstock, located at One American Row, Hartford, CT 06103, manages or
advises over 15 investment portfolios encompassing a broad range of investment
objectives. None of the directors and officers of PVA is a Trustee or officer of
the Fund, except Philip K. Polkinghorn, who is an officer of PVA and an officer
and Trustee of the Fund, and Gina Collopy O'Connell, who is an officer of PVA
and an officer of the Fund. There are no Fund Trustees in any material
transactions, directly or indirectly, to which the advisor to the Fund was or is
a party of the transaction. There are no financial conditions of the advisor
that are reasonably likely to impair the financial ability of the advisor to
fulfill its commitment to the Fund under the advisory agreement. PVA acts as an
investment adviser with similar oversight responsibilities for subadvisers for
over 13 series of the Fund, but does not act as an investment manager to funds
with similar investment objectives.
S&P, the investment subadvisor for each of S&P Dynamic Series, located
at 55 Water Street, New York, New York 10041, subadvises two investment
portfolios encompassing a broad range of investment objectives. S&P is a limited
liability company of the McGraw-Hill Companies, Inc., ("McGraw-Hill").
McGraw-Hill owns 75% or more of S&P. None of the directors and officers of S&P
is a Trustee or officer of the Fund. There are no Fund Trustees in any material
transactions, direct or indirectly, to which the subadvisor to the Fund was or
is a party to the transaction. There are no financial conditions of the
subadvisor that are reasonably likely to impair the financial ability of the
subadvisor to fulfill its commitment to the Fund under the subadvisory
agreement.
The portfolio manager for S&P Dynamic Series is Christopher M. Wilkos,
who is primarily responsible for the day-to-day management of the series.
Christopher M. Wilkos, CFA has served as portfolio manager for the
series since its inception. Mr. Wilkos is senior vice president (since 2001),
Corporate Portfolio Management for The Phoenix Companies, Inc., responsible for
managing the general account investment portfolios of the company. He oversees
asset allocation, asset-liability management, derivatives management, and
performance reporting. Mr. Wilkos joined the company in 1997 as director of
Corporate Portfolio Management and was named vice president in 1998. The
subadvisor has the primary responsibility for providing investment
recommendations to the advisor. David J. Braverman and John W. Krey share the
primary responsibility for the investment recommendation provided by the
subadvisor to the advisor.
11
David J. Braverman has been vice president of the subadvisor since 2002
with responsibility for providing investment advice used for the development of
new investment products as well as advisory relationships. He has worked for
S&P's since 1985. Prior to that, Mr. Braverman worked for S&P's corporate parent
for four years as an economist and as a cash management analyst in the Corporate
Treasurer's office.
John W. Krey has been a senior portfolio officer since 2003. He has
worked in various businesses within S&P's since 1997. From 1997 - 1999, he was a
senior analyst, from 1999 - 2003; he was an investment officer and senior
investment officer in the quantitative service group. Before joining S&P's, Mr.
Krey was a portfolio manager and chief investment strategist for the
international private banking division of Barclays Bank ("Barclays") from 1992 -
1997. At Barclays, he developed and executed investment strategies and helped to
market Barclay's investment products.
Listed below are the names of officers or members of the Board of
Managers of S&P. None are directors or officers of the Fund.
Position Position
Name with Subadvisor with Fund
---- --------------- ---------
Thomas F. Gizicki President and Member, Board of None
Managers
Lawrence Neal Senior Vice President None
David Braverman Vice President None
Philip Edwards Vice President None
Kenneth Shea Vice President None
Patrick Milano Vice President and Member, Board None
of Managers
Deborah Flanagan Vice President None
Robert Harris Chief Compliance Officer None
Robert Benjamin Secretary None
Richard Gallagher Treasurer None
S&P acts as an investment advisor to other institutional investors
having similar investment objectives, but does not currently act as an
investment advisor to other U.S. registered mutual funds with the same
investment strategies as to S&P Dynamic Series. S&P Dynamic Series was designed
on established principles of asset allocation and seek to provide various levels
of potential return at various levels of risk.
Van Kampen, the investment subadvisor for Van Kampen Comstock, located
at 1221 Avenue of the Americas, New York, New York 10020, manages or advises
over 260 investment portfolios encompassing a broad range of investment
objectives. Morgan Stanley Investment Management, Inc. d/b/a Van Kampen is an
indirect wholly-owned subsidiary of Morgan Stanley.
12
Morgan Stanley owns 100% of Van Kampen. None of the directors and officers of
Van Kampen is a Trustee or officer of the Fund. There are no Fund Trustees in
any material transactions, direct or indirectly, to which the subadvisor to the
Fund was or is a party to the transaction. There are no financial conditions of
the subadvisor that are reasonably likely to impair the financial ability of the
subadvisor to fulfill its commitment to the Fund under the subadvisory
agreement.
Van Kampen Comstock is managed by Van Kampen's Multi-Cap Value Team.
The portfolio managers are assisted by other members of Van Kampen's Multi-Cap
Value Team. Members of the team may change from time to time. The following
individuals are primarily responsible for the day-to-day management of the
portfolio: B. Robert Baker, Jr., portfolio manager, is a managing director of
Van Kampen. He joined Van Kampen in 1991 and has 26 years of investment
experience. As the lead portfolio manager, Mr. Baker has ultimate responsibility
for the strategy and is the final arbiter on decisions. Mr. Baker has a BA from
Westminster College and an MBA from the University of North Texas.
Kevin C. Holt, portfolio manager, is a managing director of Van Kampen.
He joined Van Kampen in 1999 and has 16 years of investment experience. Mr. Holt
has a BA from the University of Iowa and an MBA from the University of Chicago.
Jason S. Leder, portfolio manager, is a managing director of Van
Kampen. He joined Van Kampen in 1995 and has 16 years of investment experience.
Mr. Leder has a BA from the University of Texas at Austin and an MBA from
Columbia University.
Listed below are the names of officers or Trustees of Van Kampen. None
are directors or officers of the Fund.
Position Position
Name with Subadvisor with Fund
---- --------------- ---------
Owen T. Thomas President and Chief Operating None
Officer
Ronald E. Robison Managing Director and Director None
Amy R. Doberman Managing Director and Secretary None
Dennis F. Shea Managing Director and Chief None
Investment Officer - Global
Equity Group
J. David Germany Managing Director and
Chief Investment Officer - Global None
Fixed Income Group
Carsten Otto Managing Director and Chief None
Compliance Officer
Kenneth Castiglia Chief Financial Officer and None
Treasurer
13
Van Kampen acts as an investment advisor to other institutional
investors having similar investment objectives as Van Kampen Comstock. The
investment objective for Van Kampen Comstock is long-term capital appreciation.
The series has a secondary investment objective to seek current income.
The following table identifies and states the size of such other mutual
fund series and the rates of Van Kampen's compensation. Van Kampen has agreed to
waive, reduce, or otherwise agreed to reduce its compensation under applicable
contracts.
Unaffiliated funds having similar investment objectives as Van Kampen
Comstock:
Fees Paid
---------
Name of Fund Size of Fund (as of June 30, 2006)
------------ ------------
VK Life Investment Trust $3.3 billion 0.56%
Comstock Portfolio
VK Comstock Fund $18.0 billion 0.37%
PM Holdings, Inc., located at One American Row, Hartford, Connecticut
06103, wholly owns PVA. PM Holdings, Inc., owns 100% of PVA's voting securities.
PM Holdings, Inc., is wholly owned by Phoenix Life Insurance Company, located at
One American Row, Hartford, Connecticut 06103. Phoenix Life Insurance Company
owns 100% of PM Holdings, Inc.'s voting securities. Phoenix Life Insurance
Company is wholly owned by The Phoenix Companies, Inc., located at One American
Row, Hartford, Connecticut 06103. The Phoenix Companies, Inc., owns 100% of the
Phoenix Life Insurance Company's voting securities. The Fund does not have an
underwriter. Phoenix Equity Planning Corporation ("PEPCO") serves as financial
agent to the Fund. PEPCO is located at One American Row, Hartford, Connecticut
06103.
HOUSEHOLDING OF MATERIALS
-------------------------
The Fund sent only one copy of this Informational Statement and the
semi-annual and annual reports to those households in which multiple
shareholders shared the same address unless the Fund received instructions from
a shareholder in such a household requesting separate copies of these materials.
If you are a shareholder who shares the same address as other shareholders of
the Fund and would like to receive a separate copy of this Information
Statement, the semi-annual report, annual reports or future proxy statements,
please contact Phoenix Variable Products Mail Operations by calling (800)
541-0171, or write to Phoenix Variable Products Mail Operations, P. O. Box 8027,
Boston, Massachusetts 02266-8027. If you share the same address as multiple
shareholders and would like the Fund to send only one copy of future proxy
statements, information statements, semi-annual reports and annual reports,
please contact Phoenix Variable Products Mail Operations at the above phone
number or post office address.
14
FUTURE SHAREHOLDER MEETINGS
---------------------------
As a Massachusetts business trust, the Fund does not hold shareholder
meetings unless required by the 1940 Act. The Fund relied upon an Order from the
SEC to terminate PIC as the investment advisor, approve an investment advisory
agreement between PVA and the Fund, terminate the subadvisory agreement between
PIC and S&P, and approve a new subadvisory agreement between PVA and S&P for S&P
Dynamic Series without a shareholder meeting. The Fund also relied upon the same
Order to terminate EAM as advisor, hire PVA as advisor, and retain Van Kampen as
the new subadvisor and approve a new subadvisory agreement between PVA and Van
Kampen without a shareholder meeting. Shareholders who wish to present a
proposal for action at the next meeting should submit the proposal to:
Kathleen A. McGah
Phoenix Life Insurance Company
One American Row
P.O. Box 5056
Hartford, CT 06102-5056
Proposals must be received a reasonable time prior to the date of the
shareholder meeting to be considered for inclusion in the proxy materials for
the meeting. Timely submission of a proposal does not, however, necessarily mean
that the proposal will be submitted for consideration by shareholders.
By Order of the Board of Trustees,
/s/ Kathleen A. McGah
Kathleen A. McGah
Vice President, Chief Legal Officer
Counsel and Secretary
Hartford, Connecticut
August 1, 2006
15
Exhibit A
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT, effective as of the 1st day of May, 2006 (the "Contract
Date") by and between The Phoenix Edge Series Fund, a Massachusetts business
trust (the "Trust") and Phoenix Variable Advisors, Inc., a Delaware corporation
(the "Advisor").
WITNESSETH THAT:
1. The Trust hereby appoints the Advisor to act as investment
advisor to the Trust on behalf of the series of the Trust established and
designated by the Board of Trustees of the Trust (the "Trustees") on or before
the date hereof, as listed on attached Schedule A (collectively, the "Existing
Series"), for the period and on the terms set forth herein. The Advisor accepts
such appointment and agrees to render the services described in this Agreement
for the compensation herein provided.
2. In the event that the Trustees desire to retain the Advisor to
render investment advisory services hereunder with respect to one or more
additional series (the "Additional Series"), by agreement in writing, the Trust
and the Advisor may agree to amend Schedule A to include such Additional Series,
whereupon such Additional Series shall become subject to the terms and
conditions of this Agreement.
3. The Advisor shall furnish continuously an investment program
for the Existing Series and any Additional Series which may become subject to
the terms and conditions set forth herein (sometimes collectively referred to as
the "Series") and shall manage the investment and reinvestment of the assets of
each Series, subject at all times to the supervision of the Trustees.
4. The Advisor may delegate its investment responsibilities under
paragraph 3 above with respect to the Series or segments thereof to one or more
persons or companies ("Subadvisor(s)") pursuant to an agreement between the
Advisor, the Trust and any such Subadvisor ("Subadvisory Agreement"). Each
Subadvisory Agreement may provide that the applicable Subadvisor, subject to the
control and supervision of the Board of Trustees and the Advisor, shall have
full investment discretion for the Series, shall make all determinations with
respect to the investment and reinvestment of the assets of each Series assigned
it. Any delegation of duties pursuant to this paragraph shall comply with any
applicable provisions of Section 15 of the Investment Company Act of 1940 (the
"Act"), except to the extent permitted by any exemptive order of the Securities
and Exchange Commission ("SEC") or similar relief. The Advisor shall not be
responsible or liable for the investment merits of any decision by a Subadvisor
to purchase, hold or sell a security for any Series' portfolio.
5. With respect to managing the investment and reinvestment of
the Series' assets, the Advisor shall provide, at its own expense:
(a) Investment research, advice and supervision;
(b) An investment program for each Series consistent with
its investment objectives, policies and procedures;
A-1
(c) Implementation of the investment program for each
Series including the purchase and sale of securities;
(d) Implementation of an investment program designed to
manage cash, cash equivalents and short-term
investments for a Series with respect to assets
designated from time to time to be managed by a
subadvisor to such Series;
(e) Advice and assistance on the general operations of
the Trust; and
(f) Regular reports to the Trustees on the implementation
of each Series' investment program.
6. The Advisor shall, for all purposes herein, be deemed to be an
independent contractor and shall, unless otherwise expressly provided or
authorized, have no authority to act for or represent the Trust or the Series in
any way or otherwise be deemed an agent of the Trust or of the Series. However,
one or more shareholders, officers, directors or employees of the Advisor may
serve as trustees and/or officers of the Trust, but without compensation or
reimbursement of expenses for such services from the Trust. Nothing herein
contained shall be deemed to require the Trust to take any action contrary to
its Declaration of Trust, as amended (the "Declaration of Trust"), as amended,
restated or supplemented, or any applicable statute or regulation, or to relieve
or deprive the Board of Trustees of its responsibility for and control of the
affairs of the Series.
7. The Advisor shall furnish at its own expense, or pay the
expenses of the Trust, for the following:
(a) Office facilities, including office space, furniture
and equipment;
(b) Personnel necessary to perform the functions required
to manage the investment and reinvestment of each
Series' assets (including those required for
research, statistical and investment work);
(c) Except as otherwise approved by the Board, personnel
to serve without salaries from the Trust as officers
or agents of the Trust. The Advisor need not provide
personnel to perform, or pay the expenses of the
Trust for, services customarily performed for an
open-end management investment company by its
national distributor, custodian, financial agent,
transfer agent, registrar, dividend disbursing agent,
auditors and legal counsel;
(d) Compensation and expenses, if any, of the Trustees
who are also full-time employees of the Advisor or
any of its affiliates; and
A-2
(e) Any subadvisor recommended by the Advisor and
appointed to act on behalf of the Trust.
8. All costs and expenses not specifically enumerated herein as
payable by the Advisor shall be paid by the Trust. Such expenses shall include,
but shall not be limited to, all expenses (other than those specifically
referred to as being borne by the Advisor) incurred in the operation of the
Trust and any public offering of its shares, including, among others, interest,
taxes, brokerage fees and commissions, fees of Trustees who are not affiliated
persons of the Advisor (as that term is defined in the Act) or any of its
affiliates, expenses of Trustees' and shareholders' meetings including the cost
of printing and mailing proxies, expenses of Advisor personnel attending Trustee
meetings as required, expenses of insurance premiums for fidelity and other
coverage of the Trust and its personnel, expenses of repurchase and redemption
of shares, expenses of issue and sale of shares (to the extent not borne by its
national distributor under its agreement with the Trust), expenses of printing
and mailing stock certificates representing shares of the Trust, association
membership dues, charges of custodians, transfer agents, dividend disbursing
agents and financial agents, bookkeeping, auditing and legal expenses. The Trust
will also pay the fees and bear the expense of registering and maintaining the
registration of the Trust and its shares with the Securities and Exchange
Commission and registering or qualifying its shares under state or other
securities laws and the expense of preparing and mailing prospectuses and
reports to shareholders. Additionally, if authorized by the Trustees, the Trust
shall pay for extraordinary expenses and expenses of a non-recurring nature
which may include, but not be limited to the reasonable and proportionate cost
of any reorganization or acquisition of assets and the cost of legal proceedings
to which the Trust is a party.
9. The Advisor shall adhere and shall use reasonable efforts to
cause the Trust to adhere to all applicable policies and procedures as adopted
from time to time by the Trustees, including but not limited to the following:
(a) Code of Ethics. The Advisor shall adopt a Code of
Ethics designed to prevent "access persons" (as
defined therein in accordance with Rule 17j-1 under
the Investment Company Act of 1940 (the "Investment
Company Act")) from engaging in fraudulent acts or
transactions that are, or have the potential of being
viewed as, a conflict of interest, and shall monitor
for compliance with its Code of Ethics and report any
violations to the Trust's Compliance Officer.
(b) Policy with Respect to Brokerage Allocation. The
Advisor shall have full trading discretion in
selecting brokers for Series transactions on a day to
day basis so long as each selection is in conformance
with the Trust's Policy with Respect to Brokerage
Allocation. Such discretion shall include use of
"soft dollars" for certain broker and research
services, also in conformance with the Trust's Policy
with Respect to Brokerage Allocation. The Advisor may
delegate the responsibilities under this section to a
Subadvisor of a Series.
A-3
(c) Procedures for the Determination of Liquidity of
Assets. It shall be the responsibility of the Advisor
to monitor the Series' assets that are not liquid,
making such determinations as to liquidity of a
particular asset as may be necessary, in accordance
with the Trust's Procedures for the Determination of
Liquidity of Assets. The Advisor may delegate the
responsibilities under this section to a Subadvisor
of a Series.
(d) Policy with Respect to Proxy Voting. In the absence
of specific direction to the contrary and in a manner
consistent with the Trust's Policy with Respect to
Proxy Voting, the Advisor shall be responsible for
voting proxies with respect to portfolio holdings of
the Trust. The Advisor shall review all proxy
solicitation materials and be responsible for voting
and handling all proxies in relation to the assets
under management by the Advisor in accordance with
such policies and procedures adopted or approved by
each Series'. Unless the Fund gives the Advisor
written instructions to the contrary, the Advisor
will, in compliance with the proxy voting procedures
of the Series then in effect or approved by the
Series, vote or abstain from voting, all proxies
solicited by or with respect to the issuers of
securities in which the assets of the Series may be
invested. The Advisor shall cause the Custodian to
forward promptly to the Advisor (or designee) all
proxies upon receipt so as to afford the Advisor a
reasonable amount of time in which to determine how
to vote such proxies. The Advisor agrees to provide
the Trust with quarterly proxy voting reports in such
form as the Trust may request from time to time. The
Advisor may delegate the responsibilities under this
section to a Subadvisor of a Series.
(e) Procedures for the Valuation of Securities. It shall
be the responsibility of the Advisor to fully comply
with the Trust's Procedures for the Valuation of
Securities. The Advisor may delegate the
responsibilities under this section to a Subadvisor
of a Series.
10. The Advisor hereby warrants and represents that it will
provide the requisite certifications requested by the chief executive officer
and chief financial officer of the Fund necessary for those named officers to
fulfill their reporting and certification obligations on Forms N-CSR and N-Q as
required under the Sarbanes-Oxley Act of 2002.
11. For providing the services and assuming the expenses outlined
herein, the Trust agrees that the Advisor shall be compensated as follows:
(a) The Trust shall pay a monthly fee calculated at an
annual rate as specified in Schedule A. The amounts
payable to the Advisor with respect to the respective
Series shall be based upon the average of the values
of the net assets of such Series excluding the net
assets representing capital contributed by Phoenix
Life Insurance Company ("seed money"), as of the
close of business each day, computed in accordance
with the Trust's Declaration of Trust.
A-4
(b) Compensation shall accrue immediately upon the
effective date of this Agreement.
(c) If there is termination of this Agreement with
respect to any Series during a month, the Series' fee
for that month shall be proportionately computed upon
the average of the daily net asset values of such
Series for such partial period in such month.
(d) The Advisor, at its discretion, agrees to reimburse
the Trust for the amount, if any, by which the total
operating and management expenses for any Series
(including the Advisor's compensation, pursuant to
this paragraph, but excluding taxes, interest, costs
of portfolio acquisitions and dispositions and
extraordinary expenses), for any "fiscal year" exceed
the level of expenses which such Series is permitted
to bear under the most restrictive expense limitation
(which is not waived by the State) imposed on
open-end investment companies by any state in which
shares of such Series are then qualified. Such
reimbursement, if any, will be made by the Advisor to
the Trust within five days after the end of each
month. For the purpose of this subparagraph (d), the
term "fiscal year" shall include the portion of the
then current fiscal year which shall have elapsed at
the date of termination of this Agreement.
12. The services of the Advisor to the Trust are not to be deemed
exclusive, the Advisor being free to render services to others and to engage in
other activities. Without relieving the Advisor of its duties hereunder and
subject to the prior approval of the Trustees and subject farther to compliance
with applicable provisions of the Investment Company Act, as amended, the
Advisor may appoint one or more agents to perform any of the functions and
services which are to be provided under the terms of this Agreement upon such
terms and conditions as may be mutually agreed upon among the Trust, the Advisor
and any such agent.
13. The Advisor shall not be liable to the Trust or to any
shareholder of the Trust for any error of judgment or mistake of law or for any
loss suffered by the Trust or by any shareholder of the Trust in connection with
the matters to which this Agreement relates, except a loss resulting from
willful misfeasance, bad faith, gross negligence or reckless disregard on the
part of the Advisor in the performance of its duties hereunder.
14. It is understood that:
(a) Trustees, officers, employees, agents and
shareholders of the Trust are or may be "interested
persons" of the Advisor as directors, officers,
stockholders or otherwise;
(b) Directors, officers, employees, agents and
stockholders of the Advisor are or may be "interested
persons" of the Trust as Trustees, officers,
shareholders or otherwise; and
A-5
(c) The existence of any such dual interest shall not
affect the validity hereof or of any transactions
hereunder.
15. This Agreement shall become effective with respect to the
Existing Series as of the date stated above, and with respect to any Additional
Series, on the date specified in any amendment to this Agreement reflecting the
addition of each Additional Series in accordance with paragraph 2 (the
"Amendment Date"). Unless terminated as herein provided, this Agreement shall
remain in full force and effect until November 30, 2007 with respect to each
Existing Series and until November 30 of the first full calendar year following
the Amendment Date with respect to each Additional Series, and shall continue in
full force and effect for periods of one year thereafter with respect to each
Series so long as (a) such continuance with respect to any such Series is
approved at least annually by either the Trustees or by a "vote of the majority
of the outstanding voting securities" of such Series and (b) the terms and any
renewal of this Agreement with respect to any such Series have been approved by
a vote of a majority of the Trustees who are not parties to this Agreement or
"interested persons" of any such party cast in person at a meeting called for
the purpose of voting on such approval; provided, however, that the continuance
of this Agreement with respect to each Additional Series is subject to its
approval by a "vote of a majority of the outstanding voting securities" of any
such Additional Series on or before the next anniversary of the Contract Date
following the date on which such Additional Series became a Series hereunder.
Any approval of this Agreement by a vote of the holders of a "majority
of the outstanding voting securities" of any Series shall be effective to
continue this Agreement with respect to such Series notwithstanding (a) that
this Agreement has not been approved by a "vote of a majority of the outstanding
voting securities" of any other Series of the Trust affected thereby and (b)
that this Agreement has not been approved by the holders of a "vote of a
majority of the outstanding voting securities" of the Trust, unless either such
additional approval shall be required by any other applicable law or otherwise.
16. The Advisor shall furnish any state insurance commissioner
with such information or reports in connection with the services provided under
this Agreement as the Commissioner may request in order to ascertain whether
variable life insurance or variable annuity operations are being conducted in
accordance with applicable law or regulations. The Trust shall own and shall be
open to inspection, audit and photocopying during regular business hours by the
Trustees, officers, counsel and auditors of the Trust.
17. The Trust may terminate this Agreement with respect to the
Trust or to any Series upon 60 days' written notice to the Advisor at any time,
without the payment of any penalty, by vote of the Trustees or, as to each
Series, by a "vote of the majority of the outstanding voting securities" of such
Series. The Advisor may terminate this Agreement upon 60 days' written notice to
the Trust, without the payment of any penalty. This Agreement shall immediately
terminate in the event of its "assignment".
18. The terms "majority of the outstanding voting securities",
"interested persons" and "assignment", when used herein, shall have the
respective meanings in the Investment Company Act.
A-6
19. It is expressly agreed that the obligations of the Trust
hereunder shall not be binding upon any of the Trustees, shareholders, nominees,
officers, agents or employees of the Trust personally, but bind only the trust
property of the Trust, as provided in the Declaration of Trust. The execution
and delivery of this Agreement have been authorized by the Trustees and
shareholders of the Trust and signed by the President of the Trust, acting as
such, and neither such authorization by such Trustees and shareholders nor such
execution and delivery by such officer shall be deemed to have been made by any
of them individually or be binding upon or impose any liability on any of them
personally, but shall bind only the trust property of the Trust as provided in
its Declaration of Trust.
20. This Agreement shall be construed and the rights and
obligations of the parties hereunder enforced in accordance with the laws of the
State of Connecticut.
21. Subject to the duty of the Advisor and the Trust 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 any Additional Series that may be
named, and the actions of the Advisor and the Trust in respect thereof.
22. The Advisor will not advise or act on behalf of the Series in
regards to class action filings, with respect to any securities held in the
Series portfolio.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first written
above.
THE PHOENIX EDGE SERIES FUND
By:/s/ Gina Collopy O'Connell
--------------------------------
Name: Gina Collopy O'Connell
Title: Senior Vice President
PHOENIX VARIABLE ADVISORS, INC.
By:/s/ John H. Beers
--------------------------------
Name: John H. Beers
Title: Vice President and Secretary
A-7
SCHEDULE A
----------
SERIES ANNUAL INVESTMENT ADVISORY FEE
------ ------------------------------
Phoenix-S&P Dynamic Asset Allocation Series: Moderate 0.40%
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth 0.40%
Phoenix-S&P Dynamic Asset Allocation Series: Growth 0.40%
Phoenix-S&P Dynamic Asset Allocation Series: Aggressive Growth 0.40%
A-8
Exhibit B
EIGHTH AMENDMENT TO INVESTMENT ADVISORY AGREEMENT
THIS AMENDMENT made by and between The Phoenix Edge Series Fund, a
Massachusetts business trust having a place of business located at 101 Munson
Street, Greenfield, Massachusetts (the "Trust") and Phoenix Variable Advisors,
Inc., a Delaware corporation having a place of business located at One American
Row, Hartford, Connecticut (the "Advisor").
RECITALS
The Trust and Advisor entered into an Investment Advisory Agreement
effective as of December 14, 1999, and amended as of July 5, 2000, September 28,
2000, October 29, 2001, August 9, 2002, February 10, 2003, May 9, 2003 and
August 12, 2005 (collectively, the "Agreement"), pursuant to which the Advisor
agreed to provide certain investment advisory and related services to the Trust.
Section 2 of the Agreement contemplated that the Advisor would render such
investment advisory services to additional series of the Trust pursuant to a
duly executed amendment to Schedule A to the Agreement. The Trust now wishes to
subject those Additional Series described in Schedule A-8 attached hereto and
made a part hereof to the terms and conditions set forth in the Agreement.
Under a certain exemptive order issued by the Securities and Exchange
Commission on August 6, 2002, Release No. 25693 (the "Order"), the Advisor has
been granted the authority, subject to the approval of the Trust's Board of
Trustees, to enter into subadvisory agreements with subadvisors, materially
amend existing subadvisory agreements, and approve new subadvisory agreements
with existing subadvisors in cases where the subadvisory agreement has been
terminated as a result of an "assignment", in each case without such subadvisory
agreement being approved by the shareholders of the applicable series. Effective
May 1, 2006, Phoenix Variable Advisors, Inc. ("PVA") assumed investment advisory
responsibility from Engemann Asset Management ("EAM") for the Phoenix-Engemann
Value Equity Series. As permitted by the Order, also effective May 1, 2006, PVA
retained Van Kampen ("Van Kampen") as subadvisor to the series. (Morgan Stanley
Investment Management Inc., does business in certain instances as "Miller
Anderson", "Van Kampen" or "Morgan Stanley Asset Management"). Commensurated
with the change in advisor, and the addition of a new subadvisor, the name of
the series has been changed from Phoenix-Engemann Value Equity Series to
Phoenix-Van Kampen Comstock Series.
NOW, THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the parties do hereby agree to amend the
Agreement as follows:
1. Schedule A to the Agreement is hereby amended so as to reflect
the inclusion of the Series, as more particularly described in Schedule A-8.
2. Schedule A to the Agreement is hereby amended so as to delete
any reference to "Phoenix-Engemann Value Equity Series" and replace the name
with "Phoenix-Van Kampen Comstock Series" therefor, effective as of May 1, 2006.
B-1
3. Section 8 of the Agreement is hereby amended in order to
reflect that the Advisor shall be compensated for its services in connection
with each Series in accordance with the rates set forth in Schedule A-8.
4. Except as herein above and herein before modified, all other
terms and conditions set forth in the Agreement shall be and remain in full
force and effect. All initial capitalized terms used herein shall have such
meaning as ascribed thereto in the Agreement, as amended.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
through their undersigned duly elected officers as of this the 1st day of May,
2006.
THE PHOENIX EDGE SERIES FUND
By:/s/ Gina Collopy O'Connell
--------------------------------
Name: Gina Collopy O'Connell
Title: Senior Vice President
PHOENIX VARIABLE ADVISORS, INC.
By: /s/ John H. Beers
--------------------------------
Name: John H. Beers
Title: Vice President and Secretary
B-2
SCHEDULE A-8
Series Investment Advisory Fee
- ------ -----------------------
Phoenix-Van Kampen Comstock Series 0.70% on the first $250 million of Series assets
0.65% on the next $250 million of Series assets
0.60% on the Series assets in excess of $500 million
B-3
Exhibit C
SUBADVISORY AGREEMENT
THE PHOENIX EDGE SERIES FUND
Phoenix-S&P Dynamic Asset Allocation Series: Moderate
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth
Phoenix-S&P Dynamic Asset Allocation Series: Growth
Phoenix-S&P Dynamic Asset Allocation Series: Aggressive Growth
Standard & Poor's Investment Advisory Services LLC
55 Water Street
New York, New York 10041
Attn: Thomas F. Gizicki, President
AGREEMENT dated as of May 1, 2006 (the "Effective Date") by
and between Phoenix Variable Advisors, Inc. (the "Advisor"), a corporation
organized under the laws of the State of Delaware, and Standard & Poor's
Investment Advisory Services LLC (the "Subadvisor"), a limited liability company
organized under the laws of the State of Delaware.
WHEREAS, The Phoenix Edge Series Fund (the "Fund") is a
diversified open-end investment company of the series type registered under the
Investment Company Act of 1940, as amended, (the "1940 Act"); and
WHEREAS, the shares of the Fund may be offered in one or more
separate series, including the Phoenix-S&P Dynamic Asset Allocation Series:
Moderate, Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth,
Phoenix-S&P Dynamic Asset Allocation Series: Growth and Phoenix-S&P Dynamic
Asset Allocation Series: Aggressive Growth (collectively, the "Designated
Series"); and
WHEREAS, the Advisor has entered into an Investment Advisory
Agreement ("Advisory Agreement") with the Fund pursuant to which the Advisor
acts as investment advisor to the Fund on behalf of one or more separate series
of the Fund, including the Designated Series; and
WHEREAS, pursuant to the Advisory Agreement, the Advisor
renders certain investment advisory services to the Fund on behalf of the
Designated Series, including providing general oversight of the Designated
Series, and evaluating, recommending and monitoring one or more registered
investment advisors to serve as subadvisor to the Designated Series; and
WHEREAS, the Advisor desires, with the approval of the Board
of Trustees of the Fund (the "Trustees"), to retain the Subadvisor to furnish
investment recommendations to the Advisor for the Designated Series; and
WHEREAS, the Advisor has agreed to perform the services of
investment advisor to the Fund, the assets of which will be principally invested
in exchange-traded funds the shares of which are traded on one or more U.S.
securities exchanges ("ETFs");
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WHEREAS, pursuant to its agreements with the Fund, the Advisor
has, or will have, full discretion, subject to the Fund's stated fundamental
investment policies and objectives, with respect to the investment of the assets
of the Fund and with respect to certain related matters;
WHEREAS, the Subadvisor is willing to furnish such services on
the terms and conditions hereinafter set forth;
NOW THEREFORE, the Advisor and the Subadvisor agree as
follows:
1. Employment as a Subadvisor. The Advisor, being duly authorized, hereby
appoints the Subadvisor to serve as subadvisor with regard to the
assets of the Designated Series (the "Assets"), subject to the terms
and conditions set forth in this Agreement.
2. Acceptance of Employment; Standard of Performance. The Subadvisor
accepts its engagement as a subadvisor of the Designated Series and
agrees to use its best professional judgment to make investment
recommendations and provide related services for the Designated Series
in accordance with the terms and conditions set forth in this Agreement
and as set forth in Schedule B attached hereto and made a part hereof.
(a) It will be the responsibility of the Advisor to accept,
reject, or modify the Subadvisor's buy and sell
recommendations for the Designated Series, calculate, arrange
and execute purchases and redemptions of the appropriate
number of underlying fund shares to effect the recommendations
it accepts from the Subadvisor, execute all portfolio
transactions for the Designated Series, direct all incoming
cash, and provide all required financial reporting; and
(b) The Subadvisor will report regularly to the Advisor and Board
of Trustees and will review with representatives of the
Advisor and the Board of Trustees at reasonable times the
management of the Designated Series, including, without
limitation, review of the general investment strategies of the
Designated Series, the performance of the Designated Series in
relation to standard industry indices, interest rate
considerations and general conditions affecting the
marketplace and will provide various other reports from time
to time as reasonably requested by the Advisor.
3. Management. Subject always to the supervision of the Fund's Board of
Trustees and the Advisor, the Subadvisor will make investment
recommendations for the Designated Series. In the performance of its
duties, the Subadvisor will satisfy its fiduciary duties to the
Designated Series (as set forth below), will monitor the Designated
Series's investments, and will comply with the stated investment
objectives, policies and restrictions of the Designated Series. The
Subadvisor and the Advisor agree that the Subadvisor will not have
investment discretion. The Subadvisor and the Advisor each will make
its officers and employees available to the other from time to time at
reasonable times to review investment policies of the Designated Series
and to consult with each other regarding the investment affairs of the
Designated Series. The Subadvisor will report to the Board of Trustees
and to the Advisor with respect to the investment
C-2
recommendations. The Subadvisor is responsible for compliance with the
provisions of Section 817(h) of the Internal Revenue Code of 1986 as
amended, applicable to the Designated Series; provided, however, that
the Subadvisor shall not be responsible where the non-compliance of the
fund with Section 817(h) of the Internal Revenue Code of 1986, as
amended, is directly caused by the failure of a registered investment
company in which the Designated Series invests to comply with such
Section.
4. Exclusivity. The parties acknowledge and agree that the services of the
Subadvisor hereunder are not deemed exclusive and that, accordingly,
the Subadvisor may render services to others so long as those services
do not in any material manner impair the ability of the Subadvisor to
perform its duties and obligations pursuant to this Agreement.
5. Activities of the Subadvisor. The Advisor and the Fund recognize that
the Subadvisor and its affiliates, officers, directors and employees
may have investments of their own, may be acting as investment advisor
or manager for others and may be providing research and analytical
support for others, all in the normal course of their business. The
Advisor also recognizes that the Subadvisor and its affiliates,
officers, directors and employees may be or become associated with
other investment entities and engage in investment management and
research and analytical services for others in the future. Except to
the extent necessary to perform its obligations hereunder, nothing
herein shall be deemed to limit or restrict the right of the Subadvisor
and its affiliates, officers, directors and employees to engage in, or
to devote time and attention to the management of or the provision of
research and other services to any other business, whether of a similar
or dissimilar nature, or to render services of any kind to any other
corporation, firm, individual or association. The Advisor and the Fund
acknowledge that the Subadvisor and its affiliates, officers, directors
and employees and other clients may hold substantial positions in the
ETFs that are owned by the Designated Series and that the Subadvisor
may on occasion give advice or take action with respect to those
positions or clients that differs from the advice and information given
to the Advisor. The Advisor further acknowledges that Standard &
Poor's, a division of The McGraw-Hill Companies, Inc. and an affiliated
business of the Subadvisor ("S&P"), has a financial interest in certain
ETFs that are based on S&P's proprietary indices by virtue of licensing
relationships between S&P and the sponsor of the ETF that result in the
payment of licensing fees to S&P that are based, in whole or in part,
on the assets under management in the ETF. The Advisor agrees to
disclose the foregoing to investors and prospective investors in the
Fund and that its indemnification obligations to the Subadvisor
hereunder extend, without limitation, to any third party claim, action
or proceeding against the Subadvisor that is based on an allegation
that the Subadvisor's judgment in performing its services to the
Advisor hereunder was affected by S&P's financial interest in certain
ETFs that the Subadvisor recommended.
6. Expenses. During the term of this Agreement, the Subadvisor shall bear
all expenses incurred by it in connection with providing its services
hereunder. Without limiting the foregoing, the parties acknowledge and
agree that the Subadvisor shall furnish at its own expense, or pay the
expenses of the Advisor, for the following items:
C-3
(a) Office facilities, including office space, furniture and
equipment utilized by the Subadvisor's employees in the
fulfillment of its duties and obligations under this
Agreement; and
(b) Personnel and services necessary to perform the functions
required to fulfill the duties and obligations of the
Subadvisor hereunder.
7. Fees for Services. The compensation of the Subadvisor for its services
under this Agreement shall be calculated and paid by the Advisor in
accordance with the attached Schedule A. Pursuant to the Advisory
Agreement between the Fund and the Advisor, the Advisor shall be solely
responsible for the payment of fees to the Subadvisor.
8. Limitation of Liability. The Subadvisor 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, so long as such acts or omissions shall not
have constituted a breach of the investment objectives, policies and
restrictions applicable to the Designated Series and such acts or
omissions shall not have resulted from the Subadvisor's willful
misfeasance, bad faith, reckless disregard or gross negligence, a
violation of the standard of care established by and applicable to the
Subadvisor in its actions under this Agreement or a breach of its duty
or of its obligations hereunder (provided further, however, that the
foregoing shall not be construed to protect the Subadvisor from
liability under the 1940 Act, other federal or state securities laws or
common law).
9. Indemnification.
(a) The Advisor agrees to indemnify and hold harmless the
Subadvisor, its officers and directors, and any person who
"controls" the Subadvisor, within the meaning of Section 15 of
the Securities Act of 1933, as amended (the "1933 Act"), from
and against any and all direct or indirect liabilities, losses
or damages (including reasonable attorneys' fees) suffered by
Subadvisor resulting from (i) the Advisor's breach of any
provision of this Agreement, (ii) willful misfeasance, bad
faith, reckless disregard or gross negligence on the part of
the Advisor or any of its officers, directors or employees in
or relating to the performance of the Advisor's duties and
obligations under this Agreement or (iii) any untrue statement
or alleged untrue statement of a material fact contained in
the Prospectus relating to the Designated Series or any
amendment thereof or any supplement thereto or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statement therein
not misleading, if such a statement or omission was made by
the Fund other than in reliance upon written information
furnished by the Subadvisor or any affiliated person of the
Subadvisor, expressly for use therein or other than upon
verbal information confirmed by the Subadvisor in writing
expressly for use therein.
In no case shall the Advisor's indemnity in favor of the
Subadvisor or any affiliated person or controlling person of
the Subadvisor, or any other provision of
C-4
this Agreement, be deemed to protect such person against any
liability to which any such person would otherwise be subject
by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties under
this Agreement.
(b) The Subadvisor agrees to indemnify and hold harmless the
Advisor, its officers and directors, and any person who
"controls" the Advisor, within the meaning of Section 15 of
the 1933 Act, from and against any and all direct or indirect
liabilities, losses or damages (including reasonable
attorneys' fees) suffered by Advisor resulting from (i) the
Subadvisor's breach of its duties under this Agreement, (ii)
willful misfeasance, bad faith, reckless disregard or gross
negligence on the part of the Subadvisor or any of its
officers, directors or employees in the performance of the
Subadvisor's duties and obligations under this Agreement or
(iii) any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus relating to the
Designated Series or any amendment thereof or any supplement
thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to
make the statement therein not misleading, if such a statement
or omission was made in reliance upon written information
furnished by the Subadvisor to the Advisor, the Fund or any
affiliated person of the Advisor or the Fund expressly for use
in the Fund's registration statement, or upon verbal
information confirmed by the Subadvisor in writing expressly
for use in the Fund's registration statement.
In no case shall the Subadvisor's indemnity in favor of the
Advisor or any affiliated person or controlling person of the
Advisor, or any other provision of this Agreement, be deemed
to protect such person against any liability to which any such
person would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.
(c) No party shall be obligated under this Section 9 to make any
payment in respect of a settlement, compromise of claim, entry
of judgment of any pending or threatened claim to which such
party has not consented, such consent not to be unreasonably
withheld or delayed.
(d) Promptly after receipt of notice of any claim or complaint or
the commencement of any action or proceeding with respect to
which the Advisor or the Subadvisor is entitled to seek
indemnification hereunder, the indemnified party will notify
the indemnifying party in writing of such claim or complaint
or of the commencement of such action or proceeding. If the
indemnifying party so elects, the indemnifying party will
assume the defense of such action or proceeding, including the
employment of counsel reasonably satisfactory to the
indemnified party and the payment of fees and disbursements of
such counsel, and the indemnifying party will not thereafter
be liable to the indemnified party for any additional
expenses. In the event, however, such counsel has a conflict
of interest or if the indemnifying party fails to employ
counsel reasonably satisfactory to the indemnified party in
either case in a timely manner, then the indemnified party
C-5
may employ separate counsel to represent or defend it in any
such action or proceeding and the indemnifying party will pay
the reasonable fees and disbursements of such counsel. In any
action or proceeding the defense of which the indemnifying
party assumes, the indemnified party will have the right to
participate in such litigation and retain counsel at its own
expense.
10. Insurance. The Subadvisor shall, during the term of this Agreement, at
its own expense, maintain liability and errors and omissions insurance
coverage in an amount deemed reasonable by the Trustees of the Fund.
11. No Personal Liability. Reference is hereby made to the Declaration of
Trust, a copy of which has been filed with the Secretary of the
Commonwealth of Massachusetts and elsewhere as required by law, and to
any and all amendments thereto so filed or hereafter so filed with the
Secretary of the Commonwealth of Massachusetts and elsewhere as
required by law. The name The Phoenix Edge Series Fund refers to the
Trustees under said Declaration of Trust, as amended, as Trustees and
not personally, and no Trustee, shareholder, officer, agent or employee
of the Fund shall be held to any personal liability in connection with
the affairs of the Fund; only the Fund estate under said Declaration of
Fund is liable. Without limiting the generality of the foregoing,
neither the Subadvisor nor any of its officers, directors, partners,
shareholders or employees shall, under any circumstances, have recourse
or cause or willingly permit recourse to be had directly or indirectly
to any personal, statutory, or other liability of any shareholder,
Trustee, officer, agent or employee of the Fund or of any successor of
the Fund, whether such liability now exists or is hereafter incurred
for claims against the Fund estate other than by reason of such
person's own willful misfeasance, bad faith or gross negligence in the
performance of his or its duties or by reason of his or its reckless
disregard of its obligations and duties to the Fund and the Designated
Series.
12. Confidentiality. Subject to the duty of the Advisor or the Subadvisor
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 Designated Series and
the actions of the Subadvisor and the Fund in respect thereof. It is
understood that any information or recommendation supplied by the
Subadvisor in connection with the performance of its obligations
hereunder is to be regarded as confidential and for use only by the
Advisor, the Fund or such persons as the Advisor may designate in
connection with the Designated Series who have agreed to maintain the
confidentiality of all such information. It is also understood that any
information supplied to the Subadvisor in connection with the
performance of its obligations hereunder, particularly, but not limited
to, any list of investments which, on a temporary basis, may not be
bought or sold for the Designated Series, is to be regarded as
confidential and for use only by the Subadvisor in connection with its
obligation to provide investment advice to the Designated Series. The
parties acknowledge and agree that all nonpublic personal information
with regard to shareholders in the Designated Series shall be deemed
proprietary information of the Advisor, and that the Subadvisor shall
use that information solely in the performance of its duties and
obligations under this Agreement and shall takes reasonable steps to
safeguard the confidentiality of that information. Further, the Advisor
and the Subadvisor shall maintain and enforce adequate
C-6
security procedures with respect to all materials, records, documents
and data relating to any of their responsibilities pursuant to this
Agreement. The term "proprietary information" does not include
information which (i) is or becomes generally available to the public
other than as a result of a disclosure directly or indirectly by the
recipient; (ii) was within the recipient's possession before it was
furnished to the recipient by or on behalf of the disclosing party
pursuant hereto, provided that the source of such information was not
bound by a confidentiality agreement with, or other contractual, legal
or fiduciary obligation of confidentiality to, the disclosing party or
any other party with respect to such information.
13. Assignment. This Agreement shall terminate automatically in the event
of its "assignment," as that term is defined in Section 2(a)(4) of the
1940 Act and Rule 2a-6 thereunder. The Subadvisor shall provide the
Advisor with reasonable advance written notice of any proposed change
of "control," as defined in Section 2(a)(9) of the 1940 Act, as will
enable the Advisor to consider whether an assignment as defined in
Section 2(a)(4) of the 1940 Act will occur and to take the steps it
deems necessary.
14. Representations, Warranties and Agreements of the Subadvisor. The
Subadvisor represents, warrants and agrees that:
(a) It is registered as an "investment adviser" under the
Investment Advisers Act of 1940 ("Advisers Act") and will maintain such
status so long as this Agreement remains in effect.
(b) It shall comply with any other applicable federal or state
requirements, and the applicable requirements of any regulatory or
self-regulatory agency, necessary to be met for its performance of the
services contemplated by this Agreement so long as this Agreement
remains in effect.
(c) It is not prohibited by the 1940 Act, the Advisers Act or
other applicable federal or state law from performing the services
contemplated by this Agreement.
(d) It is duly organized and validly existing under the laws
of the State in which it was organized with the power to own and
possess its assets and carry on its business as it is now being
conducted.
(e) It has the power and has taken all necessary action, and
has obtained all necessary licenses, authorizations and approvals, to
execute this Agreement, which Agreement constitutes its legal, valid
and binding obligation, enforceable in accordance with its terms, to
enter into and perform the services contemplated by this Agreement; and
the execution, delivery and performance by it of this Agreement does
not contravene or constitute a default under any agreement binding upon
it.
(f) It will promptly notify the Advisor of the occurrence of
any event that would disqualify it from serving as an investment
advisor to an investment company pursuant to Section 9(a) of the 1940
Act or otherwise.
C-7
(g) It has a written code of ethics complying with the
requirements of Rule 17j-l under the 1940 Act and Rule 204A-1 of the
Advisers Act and will provide the Advisor with a copy of the code of
ethics and evidence of its adoption. The Subadvisor acknowledges
receipt of the written code of ethics adopted by and on behalf of the
Fund (the "Code of Ethics"). It will not be subject to the Code of
Ethics during the term of this Agreement so long as its code of ethics
complies with applicable regulatory requirements and has been approved
by the Trustees. Within 10 days of the end of each calendar quarter
while this Agreement is in effect, a duly authorized compliance officer
of the Subadvisor shall certify to the Fund and to the Advisor that, to
the best of such compliance officer's knowledge, the Subadvisor has
complied with the requirements of Rules 17j-l and 204A-1 of the
Advisers Act during the previous calendar quarter and that there has
been no violation of its code of ethics, or the Code of Ethics, as the
case may be, or if such a violation has occurred, that appropriate
action was taken in response to such violation. The Subadvisor shall
permit the Fund and the Advisor to examine the reports made by the
Subadvisor under Rule 17j-l(c)(2) or as required by law.
(h) It will use all necessary efforts to make investment
recommendations to the Designated Series that are consistent with the
diversification and minimum "good income" requirements of Subchapter M
and the diversification requirements of Section 817(h) of the Internal
Revenue Code of 1986, as amended.
(i) It has furnished a true and complete copy of its
registration statement as filed with the Securities and Exchange
Commission (the "Commission") on Form ADV to the Advisor and will
furnish promptly such updated copies of its registration statement or
amendments thereto as are filed with the Commission from time to time.
(j) It will furnish to the Advisor true and complete copies of
reports or other documents as may be reasonably requested by the
Advisor in connection with the performance of the Subadvisor's duties
and obligations under this Agreement.
(k) It will furnish or otherwise make available to the Advisor
such other information relating to the business affairs of the
Subadvisor or the management of the Designated Series as the Advisor at
any time, or from time to time, reasonably requests in connection with
the Advisor's or Subadvisor's performance of its respective obligations
hereunder; subject, however, to the Subadvisor's right to retain all
such records as the Subadvisor is required to maintain under the
Advisers Act and the rules and regulations promulgated thereunder;
provided, further, that the Fund and the Advisor shall be entitled to
make and maintain copies of any records so retained by the Subadvisor.
(l) The Subadvisor hereby warrants and represents that it will
provide the requisite certifications requested by the chief executive
officer and chief financial officer of the Fund necessary for those
named officers to fulfill their reporting and certification obligations
on Form N-CSR as required under the Sarbanes-Oxley Act of 2002 in the
form presented in Schedule C attached hereto and made a part hereof.
(m) It has adopted and implemented, and throughout the term of
this Agreement shall maintain in effect and implement, policies and
procedures reasonably
C-8
designed to prevent, detect and correct violations by the Subadvisor
and its supervised persons, and, to the extent the activities of the
Subadvisor in respect to the Fund could affect the Fund, by the Fund,
of "federal securities laws" (as defined in Rule 38a-1 under the Act),
and that the Subadvisor has provided the Fund with true and complete
copies of its policies and procedures (or summaries thereof) and
related information requested by the Fund. The Subadvisor agrees to
cooperate with periodic reviews by the Fund's compliance personnel of
the Subadvisor's policies and procedures, their operation and
implementation and other compliance matters and to provide to the Fund
from time to time such additional information and certifications with
respect to the Subadvisor's policies and procedures, compliance with
federal securities laws, and related matters. The Subadvisor agrees to
promptly notify the Advisor of any material compliance violations that
affect the Designated Series.
(n) It will provide the requisite certifications required
under the Designated Series procedures related to their Order for
Exemption from Section 17(a) and 12(d) of the 1940 Act, as set forth in
Schedule D.
15. Representations, Warranties and Agreements of the Advisor. The Advisor
represents, warrants and agrees that:
(a) It is registered as an "investment adviser" under the
Advisers Act.
(b) It shall continue to meet any other applicable federal or
state requirements, or the applicable requirements of any regulatory or
self-regulatory agency, necessary to be met for its performance of the
services contemplated by this Agreement so long as this Agreement
remains in effect.
(c) It is not prohibited by the 1940 Act, the Advisers Act or
other applicable federal or state law from performing the services
contemplated by this Agreement.
(d) It is duly organized and validly existing under the laws
of the State in which it was organized with the power to own and
possess its assets and carry on its business as it is now being
conducted.
(e) It has the power and has taken all necessary action, and
has obtained all necessary licenses, authorizations and approvals, to
execute this Agreement, which Agreement constitutes its legal, valid
and binding obligation, enforceable in accordance with its terms, to
enter into and perform the services contemplated by this Agreement; and
the execution, delivery and performance by it of this Agreement does
not contravene or constitute a default under any agreement binding upon
it.
(f) It has delivered, or will before the effective date of
this Agreement deliver, to the Subadvisor true and complete copies of
(i) the Prospectus, (ii) the Declaration of Trust, as amended, and
(iii) any other documents or instruments governing the investments and
investment policies and practices of the Designated Series applicable
to the Subadvisor's duties and obligations hereunder, and during the
term of this Agreement will promptly deliver to the Subadvisor true and
complete copies of all documents and
C-9
instruments supplementing, amending, or otherwise becoming such
documents or instruments before or at the time they become effective.
(g) It will furnish or otherwise make available to the
Subadvisor such other information relating to the business affairs of
the Fund as the Subadvisor at any time, or from time to time,
reasonably requests in order to discharge its obligations hereunder.
16. Representations, Warranties and Agreements of the Fund. By their
approval of this Agreement the Trustees represent, warrant and agree
that:
(a) The Fund is not prohibited by the 1940 Act or other
applicable federal or state law from performing its obligations under
this Agreement.
(b) The Fund is duly organized and validly existing under the
laws of the State in which it was organized with the power to own and
possess its assets and carry on its business as it is now being
conducted.
(c) The Fund has taken all necessary action, and has obtained
all necessary licenses, authorizations and approvals, to permit the
Fund to enter into this Agreement, which Agreement constitutes the
Fund's legal, valid and binding obligation, enforceable in accordance
with its terms; and the execution, delivery and performance by the Fund
of this Agreement does not contravene or constitute a default under any
agreement binding upon the Fund.
17. Reports. The Subadvisor shall provide the Advisor and the Trustees such
periodic and special reports as the Advisor may reasonably request. The
Subadvisor agrees that such records are the property of the Fund, and
shall be made reasonably available for inspections, and by the Fund or
by the Advisor as agent of the Fund, and promptly upon request
surrendered to either. Without limiting the generality of the
foregoing, the parties agree and acknowledge that the Subadvisor shall
provide the following items:
(a) Quarterly reports, in form and substance acceptable to the
Advisor, including but not limited to reports with respect to: (i)
compliance with the Subadvisor's code of ethics; (ii) diversification
of Designated Series assets in accordance with the then governing laws
and prevailing Prospectus pertaining to the Designated Series; and
(iii) any and all other reports reasonably requested in accordance with
or described in this Agreement.
(b) Annual or other periodic reports, in form and substance
acceptable to the Advisor, including but not limited reports with
respect to: (i) analyses of Designated Series performance; (ii)
disclosure related to the investment advice provided by the Subadvisor
with respect to the Designated Series and the Subadvisor as may be
contained in the Prospectus or marketing materials as amended,
supplemented or otherwise updated from time to time; (iii) compliance
with the Subadvisor's code of ethics pursuant to Rule 17j-1; and (iv)
such compliance certifications as may be reasonably requested.
(c) The parties acknowledge and agree that the Subadvisor is
authorized to supply the Fund's independent registered public
accounting firm, or any successor
C-10
accountant for the Fund, any information that they may request in
connection with the Fund.
(d) In addition, the Subadvisor shall immediately notify and
forward to both the Advisor and any legal counsel for the Designated
Series whose identity has been provided to the Subadvisor any legal
process served upon it on behalf of the Advisor or the Fund. The
Subadvisor shall promptly notify the Advisor of any changes in any
information concerning the Subadvisor of which the Subadvisor becomes
aware that is or would be required to be disclosed in the Fund's
registration statement.
18. Amendment. This Agreement may be amended at any time, but only by
written agreement between the Subadvisor and the Advisor, which
amendment, other than amendments to Schedule A, B, C, or D is subject
to the approval of the Trustees and the Shareholders of the Designated
Series as and to the extent required by the 1940 Act.
19. Effective Date; Term. This Agreement shall become effective on the date
set forth on the first page of this Agreement. Unless terminated as
hereinafter provided, this Agreement shall remain in full force and
effect until November 30, 2007, and thereafter only so long as its
continuance has been specifically approved at least annually in
accordance with Sections 15(a) and (c) of the 1940 Act and the Rules
promulgated thereunder.
20. Notices. Except as otherwise provided in this Agreement, all notices or
other communications required of or permitted to be given hereunder
shall be in writing and shall be delivered or sent by (i) confirmed
facsimile, (ii) registered, certified or overnight mail, or (iii) a
nationally recognized overnight courier, to the following addresses or
to such other address as the relevant addressee shall hereafter provide
for such purpose to the other by notice in writing and shall be deemed
to have been given at the time of delivery.
If to the Advisor: PHOENIX VARIABLE ADVISORS, INC.
One American Row
Hartford, Connecticut
Attn: Doreen A. Bonner
Telephone: (860) 403-5456
Facsimile: (860) 403-7696
Email: Doreen.Bonner@phoenixwm.com
If to the Subadvisor: STANDARD & POOR'S INVESTMENT
ADVISORY SERVICES LLC
55 Water Street
New York, New York 10041
Attn: Thomas F. Gizicki, President
Telephone: (212) 438-3737
Facsimile: (212) 438-3932
Email: tom_gizicki@standardandpoors.com
21. Termination This Agreement shall terminate immediately in the event of
its assignment, as specified above in Section 13 of this Agreement.
This Agreement may be terminated
C-11
by either party, without penalty, immediately upon written notice to
the other party in the event of a breach of any provision thereof by
the party so notified, or otherwise, by the Advisor, Subadvisor, Board
of Trustees of the Fund or vote of a majority of the outstanding voting
securities of the Designated Series upon sixty (60) days' written
notice to the other party. Notwithstanding such termination, any
liability of a party to any other party under this Agreement shall
survive and remain in full force and effect with respect to any claim
or matter on which any party has given written notice to any other
party prior to termination and until such liability has been finally
settled.
22. 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 State of New York, without giving effect to the conflicts of laws
principles thereof.
23. 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.
24. Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to the subject matter of this
Agreement.
25. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all such
counterparts shall constitute a single instrument.
(signature page to follow)
--------------------------
C-12
STANDARD & POOR'S INVESTMENT
ADVISORY SERVICES LLC
By: /s/ Thomas F. Gizicki
--------------------------------
Name: Thomas F. Gizicki
Title: President
PHOENIX VARIABLE ADVISORS, INC.
By: /s/ John H. Beers
--------------------------------
Name: John H. Beers
Title: Vice President and Secretary
ACCEPTED:
THE PHOENIX EDGE SERIES FUND
By: /s/ Gina Collopy O'Connell
-----------------------------------
Name: Gina Collopy O'Connell
Title: Senior Vice President
SCHEDULES: A. Fee Schedule
B. Subadvisor Functions
C. Form of Sub-Certification
D. Form of Fund of Funds Compliance Procedure
C-13
SCHEDULE A
----------
SUBADVISORY FEE
For services provided to the Fund, the Advisor will pay to the Subadvisor, on an
annual basis, the annual rate stated below applied against the net assets of
each Designated Series (the "Annual Fee"), less any amounts received by the
Subadvisor or any affiliated person of the Subadvisor with respect to licensing
fees received from any ETF or ETF sponsor attributable to investments of the
Designated Series in an ETF. The fees shall be prorated for any month during
which this Agreement is in effect for only a portion of the month during which
the Subadvisory Agreement is in effect. In computing the Annual Fee to be paid
to the Subadvisor, the net asset value of the Fund of each Designated Series
shall be valued as set forth in the then current registration statement of the
Fund, payable on or before the 10th day of each month, payable in arrears. The
Annual Fee that has been paid on a monthly basis will be adjusted to the actual
Annual Fee, once annually within 15 business days of the close of the fiscal
year.
Phoenix-S&P Dynamic Asset Allocation Series: Moderate 0.12%
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth 0.12%
Phoenix-S&P Dynamic Asset Allocation Series: Growth 0.12%
Phoenix-S&P Dynamic Asset Allocation Series: Aggressive Growth 0.12%
The fee to be paid to the Subadvisor will be calculated based on the average
daily net assets of the: Phoenix-S&P Dynamic Asset Allocation Series: Moderate,
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth, Phoenix-S&P
Dynamic Asset Allocation Series: Growth, and the Phoenix-S&P Dynamic Asset
Allocation Series: Aggressive Growth, and individually, for the respective
month, or shorter period during which the Subadvisory Agreement is in effect.
C-14
SCHEDULE B
----------
SUBADVISOR FUNCTIONS
With respect to managing the investment and reinvestment of the
Designated Series' assets, the Subadvisor shall provide, at its own expense:
(a) Investment recommendations for the Designated Series
consistent with its investment objectives;
(b) Quarterly reports, in form and substance acceptable to the
Adviser, with respect to: (i) compliance with the Code of
Ethics; (ii) any and all other reports reasonably requested in
accordance with or described in this Agreement; and (iii)
explanation of the investment recommendations for the
Designated Series, including, without limitation, analysis of
Designated Series performance;
(c) Promptly after filing with the Securities and Exchange
Commission an amendment to its Form ADV, a copy of such
amendment to the Advisor and the Fund;
(d) Attendance by appropriate representatives of the Subadvisor at
meetings requested by the Adviser or Trustees at such time(s)
and location(s) as reasonably requested by the Adviser or
Trustees, such meetings being expected to occur annually; and
(e) Notice to the Trust and the Advisor of the occurrence of any
event which would disqualify the Subadvisor from serving as an
investment adviser to an investment company pursuant to
Section 9(a) of the 1940 Act or otherwise.
C-15
SCHEDULE C
----------
FORM OF SUB-CERTIFICATION
To:
Re: Sub-Advisor's Form N-CSR Certification for The Phoenix Edge Series Fund
(the "Fund").
From: Standard & Poor's Investment Advisory Services LLC
Representations in support of Investment Company Act Rule 30b2-1 certifications
of Form N-CSR (collectively, the "Series).
Phoenix-S&P Dynamic Asset Allocation Series: Moderate
Phoenix-S&P Dynamic Asset Allocation Series: Moderate Growth
Phoenix-S&P Dynamic Asset Allocation Series: Growth
Phoenix-S&P Dynamic Asset Allocation Series: Aggressive Growth
I certify that to the best of my knowledge:
a. The Portfolio Manager (or whoever at S&P establishes or
recommends investment advice, holdings, allocations or
strategies to the Series') has complied with the restrictions
and reporting requirements of the Code of Ethics applicable to
the subadvisor as specified in the subadvisory agreement for
the Fund (the "Code"). The term Portfolio Manager is as
defined in the Code.
b. The subadvisor has complied with the prospectus and SAI of the
Fund and the Policies and Procedures of the Fund as adopted by
the Board of Trustees, if disclosed to the subadvisor.
c. I have no knowledge of any compliance violations relating to
the Fund except as disclosed in writing to the Phoenix
Compliance Department by me or by the subadvisor's compliance
administrator.
d. The subadvisor has complied with the rules and regulations of
the 1933 Act and 1940 Act, and such other regulations as may
apply to the extent those rules and regulations pertain to the
responsibilities of the subadvisor with respect to the Fund as
outlined above.
e. There has been no fraud, whether, or not material, that
involves our organization's management or other employees who
have a significant role in our organization's control and
procedures as they relate to our duties as subadvisor to the
Series.
C-16
This certification relates solely to the Fund named above and may not be relied
upon by any other Fund or entity.
The subadvisor does not maintain the official books and records of the Fund. The
subadvisor's records are based on its own portfolio management system, a
record-keeping system that is not intended to service as the Fund's official
accounting system. The subadvisor is not responsible for the preparation of the
Form N-CSR.
The Subadvisor makes investment recommendations to the Advisor, which accepts,
rejects, or modifies the Subadvisor's recommendations.
BY:
----------------------------------------
NAME: [Name of Authorized Signer]
--------------------------------------
TITLE:
--------------------------------------
DATE:
--------------------------------------
C-17
SCHEDULE D
THE PHOENIX EDGE SERIES FUND (THE "TRUST")
FORM OF FUND OF FUNDS COMPLIANCE PROCEDURES
1. Phoenix Variable Advisors, Inc. (the "Manager"), the
Manager's affiliates, the funds of funds (the "Funds"), and any other funds or
separate accounts advised or sponsored by the Manager or its affiliates (the
"Group") may not purchase shares of an unaffiliated underlying fund
("Unaffiliated Fund") if as a result of such purchase the members of the Group
(either individually or in the aggregate) would own 25% or more of such fund's
shares. Similarly, the Fund's subadviser, Standard & Poor's Investment Advisory
Services (the "Sub-Adviser"), the Sub-Adviser's affiliates, and any funds or
other investment companies advised by the Sub-Adviser or its affiliates (the
"Sub-Adviser Group") may not purchase shares of an Unaffiliated Fund if as a
result of such purchase the members of the Sub-Adviser Group (either
individually or in the aggregate) would own 25% or more of such fund's shares.
The Manager shall monitor the Funds' purchases to ensure no such purchases are
made. In addition, the Manager shall periodically monitor the Funds' investments
in Unaffiliated Funds to ensure that if as a result of a decrease in the
outstanding voting securities of an Unaffiliated Fund, the Group or the
Sub-Adviser Group, each in the aggregate, becomes a holder of more than 25% of
the outstanding voting securities of the Unaffiliated Fund, the voting
requirements imposed by the conditions set forth at Exhibit B are followed.
2. The Manager and Sub-Adviser may not cause any existing or
potential investment by a Fund in an Unaffiliated Fund to influence the terms of
any services or transactions between the Fund or a Fund affiliate ("Fund
Affiliate") and the Unaffiliated Fund or an Unaffiliated Fund affiliate
("Unaffiliated Fund Affiliate"). The Manager shall monitor to ensure and certify
quarterly to the Board that the Manager has not caused any existing or potential
investment by a Fund in an Unaffiliated Fund to influence the terms of any
services or transactions between the Fund or a Fund Affiliate and the
Unaffiliated Fund or an Unaffiliated Fund Affiliate. The Sub-Adviser shall
monitor to ensure and certify quarterly to the Manager that the Sub-Adviser has
not caused any existing or potential investment by a Fund in an Unaffiliated
Fund to influence the terms of any services or transactions between the Fund or
a Fund Affiliate and the Unaffiliated Fund or an Unaffiliated Fund Affiliate.
3. The Manager and the Sub-Adviser shall conduct the investment
program of the Funds without taking into account any consideration received by a
Fund or a Fund Affiliate from an Unaffiliated Fund or an Unaffiliated Fund
Affiliate in connection with any services or transactions. Representatives of
the Manager shall monitor to ensure, and the Manager shall certify quarterly to
the Board, that the Manager has so conducted the investment program.
Representatives of the Sub-Adviser shall monitor to insure and the Sub-Adviser
shall certify quarterly to the Manager that the Sub-Adviser has so conducted the
investment program.
4. Certain conditions of the Funds' exemptive relief and the
exemptive relief of the Unaffiliated Funds are operative only if an Unaffiliated
Fund purchases securities in an
C-18
"Affiliated Underwriting." As of the date of these procedures, neither the
Funds, the Manager, nor any affiliate of the Manager act as principal
underwriters in offerings of securities in which an Unaffiliated Fund would
purchase securities. Representatives of the Manager shall also confirm that as
of the date of these procedures neither the Sub-Adviser nor any affiliate of the
Sub-Adviser acts as principal underwriter in offerings of securities in which an
Unaffiliated Fund would purchase securities. Additionally, representatives of
the Manager shall annually confirm and certify to the Board that neither the
Funds, the Manager, the Sub-Adviser, nor any of their affiliates act as
principal underwriters in offerings of securities in which an Unaffiliated Fund
would purchase securities. Representatives of the Sub-Adviser shall annually
confirm and certify to the Manager that neither the Sub-Adviser nor any of its
affiliates acts as principal underwriters of securities in which an Unaffiliated
Fund would purchase securities. If the Manager is unable at any time to so
confirm and certify to the Board, these compliance procedures shall be revised
to include additional procedures to ensure compliance with the Unaffiliated
Underwriting exemptive conditions.
5. A. Before the Funds rely on the exemptive order of any
Unaffiliated Fund, the Trust and the Unaffiliated Fund shall execute an
agreement stating, without limitation, that the Board, Manager and the
Sub-Advisor understand the terms and conditions of the order and agree to
fulfill their responsibilities under the order. The Trust and the Unaffiliated
Fund shall maintain and preserve a copy of the order and the agreement for a
period of not less than six years from the end of the fiscal year in which any
investment occurred, the first two years in an easily accessible place.
B. When the Funds rely on their own exemptive order from
the SEC, prior to any Fund investing in shares of an Unaffiliated Fund in excess
of the limit set forth in Section 12(d)(1)(A)(i) of the Act (e.g., if the Fund
owns more than 3 percent of the shares of the Unaffiliated Fund), the Trust and
the Unaffiliated Fund shall execute an agreement stating, without limitation,
that their boards of directors or trustees and their investment advisers
understand the terms and conditions of the order and agree to fulfill their
responsibilities under the order. At the time of its investment in shares of an
Unaffiliated Fund in excess of the limit set forth in Section 12(d)(1)(A)(i), a
Fund shall notify the Unaffiliated Fund of the investment. The Manager shall
monitor each Fund's investments to determine if it is likely that a Fund will
invest in an Unaffiliated Fund in excess of the limits of Section
12(d)(1)(A)(i).
6. Before approving any advisory contract under Section 15 of
the Act, the Board, including a majority of the Disinterested Trustees, shall
find that the advisory fees charged under the advisory contract are based on
services provided that are in addition to, rather than duplicative of, services
provided under the advisory contract(s) of any Underlying Fund in which the Fund
may invest. Such finding, and the basis upon which the finding was made, shall
be recorded fully in the minute books of the Trust.
7. The Manager shall waive fees otherwise payable to it by a Fund
in an amount at least equal to any compensation (including fees received
pursuant to any plan adopted by an Unaffiliated Fund under Rule 12b-1 under the
Act) received from an Unaffiliated Fund by the Manager, or an affiliated person
of the Manager, other than any advisory fees paid to the Manager or its
affiliated person by the Unaffiliated Fund, in connection with the investment by
C-19
the Fund in the Unaffiliated Fund. Likewise, the Sub-Adviser shall waive fees
otherwise payable to the Sub-Adviser, directly or indirectly, by a Fund in an
amount at least equal to any compensation received from an Unaffiliated Fund by
the Sub-Adviser, or an affiliated person of the Sub-Adviser, other than any
advisory fees paid to the Sub-Adviser or its affiliated person by the
Unaffiliated Fund, in connection with the investment by the Fund in the
Unaffiliated Fund made at the direction of the Sub-Adviser. In the event that
the Sub-Adviser waives fees, the benefit of the waiver will be passed through to
the Fund. The Sub-Adviser shall certify to the Manager annually that the
requirements of this Paragraph 7 have been met.
8. With respect to registered separate accounts that invest in a
Fund, no sales load may be charged at the Fund level or at the Unaffiliated Fund
level. Other sales charges and service fees, as defined in rule 2830 of the
Conduct Rules of the NASD (generally, these fees refer to Rule 12b-1 fees and
shareholder services fees), if any, may only be charged at the Fund level or at
the Unaffiliated Fund level, not both. Because the Funds charge Rule 12b-1 fees,
this effectively prohibits a Fund from investing in an Underlying Fund that
charges Rule 12b-1 fees. With respect to other investments in a Fund (and at any
time while the Funds are relying on the exemptive order of any Unaffiliated
Fund, with respect to registered separate accounts that invest in the Fund), any
sales charges and/or service fees charged with respect to shares of a Fund may
not exceed the limits applicable to funds of funds set forth in rule 2830 of the
Conduct Rules of the NASD. The Manager shall certify to the Board annually that
the requirements of this Paragraph 8 have been met.
C-20
Exhibit D
SUBADVISORY AGREEMENT
THE PHOENIX EDGE SERIES FUND
PHOENIX-VAN KAMPEN COMSTOCK SERIES
MORGAN STANLEY INVESTMENT MANAGEMENT INC.
1221 Avenue of the Americas
New York, New York 10020
AGREEMENT made as of the 1st day of May, 2006 between Phoenix Variable
Advisors, Inc. (the "Advisor"), a corporation organized under the laws the State
of Delaware, and Morgan Stanley Investment Management Inc., d/b/a Van Kampen
(the "Subadvisor"), a corporation organized under the laws of the State of
Delaware.
WHEREAS, The Phoenix Edge Series Fund (the "Fund") is a diversified
open-end investment company of the series type registered under the Investment
Company Act of 1940, as amended, (the "1940 Act"); and
WHEREAS, the shares of the Fund may be offered in one or more separate
series, including the Phoenix-Van Kampen Comstock Series (previously known as
Phoenix-Engemann Value Equity Series) (the "Designated Series"); and
WHEREAS, the Advisor has entered into an Investment Advisory Agreement
("Advisory Agreement") with the Fund pursuant to which the Advisor acts as
investment advisor to the Fund on behalf of one or more separate series of the
Fund, including the Designated Series; and
WHEREAS, pursuant to the Advisory Agreement, the Advisor renders
certain investment advisory services to the Fund on behalf of the Designated
Series, including providing general oversight of the Designated Series, and
evaluating, recommending and monitoring one or more registered investment
advisors to serve as subadvisor to the Designated Series; and
WHEREAS, the Advisor desires, with the approval of the Trustees of the
Fund (the "Trustees"), to retain Subadvisor to furnish portfolio management
services for the Designated Series; and
WHEREAS, the Subadvisor is willing to furnish such services on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, the Advisor and the Subadvisor agree as follows:
1. Employment as a Subadvisor. The Advisor, being duly authorized, hereby
appoints the Subadvisor to serve as discretionary subadvisor with
regard to the assets of the Designated Series (the "Assets"), subject
to the terms and conditions set forth in this Agreement.
2. Acceptance of Employment; Standard of Performance. The Subadvisor
accepts its engagement as a discretionary subadvisor of the Designated
Series and agrees to use its
D-1
best professional judgment to make investment decisions and provide
related services for the Designated Series in accordance with the terms
and conditions set forth in this Agreement and as set forth in Schedule
D attached hereto and made a part hereof. The parties acknowledge and
agree that the services of the Subadvisor hereunder are not deemed
exclusive and that accordingly, the Subadvisor may render services to
others so long as those services do not conflict in any material manner
with the Subadvisor's performance of its duties and obligations
pursuant to this Agreement.
3. Services of Subadvisor. Subject to the general oversight of the Advisor
and the Trustees, the Subadvisor shall manage all of the securities and
other similar assets of the Designated Series entrusted to it under
this Agreement, including the purchase, retention, and disposition of
such securities and other property, and shall carry out all of its
duties and obligations under this Agreement, according to the following
terms and conditions:
(a) At all times in performing its duties and obligations
under this Agreement, the Subadvisor shall act in conformity with the
following requirements: (i) the investment objectives, policies and
restrictions of the Fund as they apply to the Designated Series and as
set forth in the Fund's then current prospectus and statement of
additional information, as amended or supplemented from time to time
(collectively, the "Prospectus"); (ii) the 1940 Act, the Investment
Advisers Act of 1940, as amended (the "Advisers Act") and the rules and
regulations thereunder; (iii) all other applicable federal and state
laws, as each may be amended from time to time; and (iv) and any
resolutions as may be duly adopted by the Trustees from time to time
and any instructions and procedures of the Advisor, and, in either
case, furnished to the Subadvisor (collectively, these requirements are
referred to herein as the "Investment Requirements").
(b) The Subadvisor shall furnish a continuous investment
program and shall, in its discretion, determine what portfolio
investments will be purchased, retained, or sold by the Designated
Series in conformity with the Prospectus and other Investment
Requirements.
(c) The Subadvisor shall effect all transactions and take
all actions to implement the investment objectives and policies of the
Designated Series in accordance with this Agreement.
(d) The Subadvisor shall have full authority at all times
with respect to the portfolio management of the Assets, including, but
not limited to, the authority: (i) to give written or oral instructions
to various broker/dealers, banks or other agents and to bind and
obligate the Fund to and for the carrying out of contracts,
arrangements, or transactions which shall be entered into by the
Subadvisor on the Fund's behalf with or through such broker/dealers,
banks or other agents; (ii) to direct the purchase and sale of any
securities; and (iii) to maintain such uninvested cash balances in the
Designated Series as it shall deem reasonable and appropriate without
incurring any liability for the payment of interest thereon.
(e) The Subadvisor shall not, without the Advisor's prior
written approval, effect any transaction or take any action that would
cause the Designated Series at the
D-2
time of the transaction or action to be out of compliance with any of
the Investment Requirements. The Subadvisor shall promptly inform the
Fund and the Advisor of developments materially affecting (or
reasonably expected to affect) the Designated Series, and will, on its
own initiative, furnish the Fund and the Advisor from time to time with
whatever information the Subadvisor believes is appropriate for this
purpose.
(f) The Subadvisor shall send or make available
appropriate representatives to/for regular or special meetings of the
Fund as may be reasonably requested from time to time by the Advisor.
(g) The Subadvisor shall provide appropriate
representatives to attend meetings requested by the Advisor at such
time(s) and location(s) as are reasonably requested by the Advisor.
(h) The Subadvisor shall place all orders for the purchase
or sale of securities or other investments for the Designated Series
with brokers or dealers selected by the Subadvisor, as more fully
specified below in Section 6 of this Agreement.
4. Transaction Procedures. All transactions for the purchase or sale of
securities or other investments for the Designated Series will be
consummated by payment to, or delivery by, the Custodian(s) from time
to time designated by the Fund (the "Custodian"), or such depositories
or agents as may be designated by the Custodian pursuant to its
agreement with the Fund (the "Custodian Agreement"), of all cash and/or
securities and/or other property due to or from the Designated Series.
The Subadvisor shall not have possession or custody of such cash and/or
securities or any responsibility or liability with respect to such
custody, except as expressly stated herein. The Subadvisor shall advise
the Custodian and confirm in writing or by confirmed electronic
transmission to the Fund all investment orders for the Designated
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 Subadvisor. The Fund shall be responsible for all
custodial arrangements and the payment of all custodial charges and
fees, and, upon giving proper instructions to the Custodian, the
Subadvisor shall have no responsibility or liability with respect to
custodial arrangements or the acts, omissions or other conduct of the
Custodian.
5. Recordkeeping and Reporting. The Subadvisor shall maintain the records
and information required by Rule 31a-1 under the 1940 Act described in
Schedule B attached hereto, and such other records relating to the
services the Subadvisor provides under this Agreement as may reasonably
be required in the future by applicable SEC and other applicable rules,
and shall retain such information for such times and in such manner as
required by applicable rules, including but not limited to Rule 31a-2
under the 1940 Act. The records maintained by the Subadvisor hereunder
shall be the property of the Fund and shall be surrendered promptly
upon request; subject, however, to the Subadvisor's right to retain all
such records as the Subadvisor is required to maintain under the
Advisers Act and the rules and regulations promulgated thereunder;
provided, further,
D-3
that the Fund shall be entitled to make and maintain copies of any
records so retained by the Subadvisor.
6. Allocation of Brokerage. The Subadvisor shall have authority and
discretion to select brokers and dealers to execute transactions
initiated by the Subadvisor on behalf of the Designated Series with
regard to the Assets, and to select the markets on or in which the
transactions will be executed, subject to the following limitations:
(a) The Subadvisor shall at all times seek
"best-execution", as defined in Section 28(e)(1) of the Securities
Exchange Act of 1934, as amended, (the "1934 Act").
(b) The Subadvisor shall at all times place orders for the
sale and purchase of securities in accordance with the brokerage policy
of the Designated Series as set forth in the Prospectus and as the
Advisor or the Trustees may direct from time to time.
(c) In placing orders for the sale and purchase of
Designated Series securities for the Fund, the Subadvisor's primary
responsibility shall be to seek the best execution of orders at the
most favorable prices. However, this responsibility shall not obligate
the Subadvisor to solicit competitive bids for each transaction or to
seek the lowest available commission cost to the Fund, so long as the
Subadvisor reasonably believes that the broker or dealer selected by it
can be expected to provide "best-execution" on the particular
transaction and determines in good faith that the commission cost is
reasonable in relation to the value of the "brokerage and research
services," as defined in Section 28(e)(3) of the 1934 Act, provided by
such broker or dealer to the Subadvisor, viewed in terms of either that
particular transaction or of the Subadvisor's overall responsibilities
with respect to its clients, including the Fund, as to which the
Subadvisor exercises investment discretion, notwithstanding that the
Fund may not be the direct or exclusive beneficiary of any such
services or that another broker may be willing to charge the Fund a
lower commission on the particular transaction.
7. Prohibited Conduct. In providing the services described in this
Agreement, the Subadvisor will not consult with any other investment
advisory firm that the Subadvisor knows provides investment advisory
services to any of the Funds series regarding transactions for the Fund
in securities or other assets, except as permitted by applicable Rule
12d3-1 under the 1940 Act. In addition, the Subadvisor shall not,
without the prior written consent of the Fund and the Advisor, delegate
any obligations assumed pursuant to this Agreement to any affiliated or
unaffiliated third party.
8. Expenses. During the term of this Agreement, the Subadvisor shall bear
all expenses incurred by it in connection with providing its services
hereunder. Without limiting the foregoing, the parties acknowledge and
agree that the Subadvisor shall furnish at its own expense, or pay the
expenses of the Advisor, for the following items:
(a) Office facilities, including office space, furniture
and equipment utilized by the Subadvisor's employees in the fulfillment
of its duties and obligations under this Agreement; and
D-4
(b) Personnel and services necessary to perform the
functions required to manage the investment and reinvestment of the
Assets (including those required for research, analysis, pricing,
reporting, statistics, and investment), and to fulfill the other duties
and obligations of the Subadvisor hereunder.
9. Fees for Services. The compensation of the Subadvisor for its services
under this Agreement shall be calculated and paid by the Advisor in
accordance with the attached Schedule C. Pursuant to the Advisory
Agreement between the Fund and the Advisor, the Advisor shall be solely
responsible for the payment of fees to the Subadvisor.
10. Limitation of Liability. The Subadvisor 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 or the Advisor, which includes any error of
judgment, or any diminution in value of the investment portfolio of the
Designated Series, so long as such acts or omissions shall not have
constituted a breach of the investment objectives, policies and
restrictions applicable to the Designated Series and such acts or
omissions shall not have resulted from the Subadvisor's willful
misfeasance, bad faith, reckless disregard or gross negligence, a
violation of the standard of care established by and applicable to the
Subadvisor in its actions under this Agreement or a breach of its duty
or of its obligations hereunder (provided further, however, that the
foregoing shall not be construed to protect the Subadvisor from
liability under the 1940 Act, other federal or state securities laws or
common law).
11. Indemnification.
---------------
(a) The Advisor agrees to indemnify and hold harmless the
Subadvisor, its officers and directors, and any person who "controls"
the Subadvisor, within the meaning of Section 15 of the Securities Act
of 1933, as amended (the "1933 Act"), from and against any and all
direct or indirect liabilities, losses or damages (including reasonable
attorneys' fees and costs) suffered by Subadvisor arising from, or
connected with, (i) the Advisor's breach of any provision of this
Agreement, (ii) willful misfeasance, bad faith, reckless disregard or
gross negligence on the part of the Advisor or any of its officers,
directors or employees in or relating to the performance of the
Advisor's duties and obligations under this Agreement, (iii) the
operation of the Designated Series or the Fund, or the distribution of
shares of the Designated Series or the Fund, (iv) the performance,
non-performance or omission of any third-party service provider to the
Designated Series or (v) any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus and Statement
of Additional Information, as amended or supplemented from time to time
or promotional materials pertaining or relating to the Designated
Series or any amendment thereof or any supplement thereto or the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statement therein not
misleading, if such a statement or omission was made by the Fund other
than in reliance upon written information furnished by the Subadvisor
or any affiliated person of the Subadvisor, expressly for use in the
Fund's registration statement or other than upon verbal information
confirmed by the Subadvisor in writing expressly
D-5
for use in the Fund's registration statement. The Advisor acknowledges
and agrees that the Subadvisor makes no representation or warranty,
express or implied, that any level of performance or investment results
will be achieved by the Designated Series or that the Designated Series
will perform comparably with any standard or index, including other
clients of the Subadvisor, whether public or private.
In no case shall the Advisor's indemnity in favor of the Subadvisor or
any affiliated person or controlling person of the Subadvisor, or any
other provision of this Agreement, be deemed to protect such person
against any liability to which any such person would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence
in the performance of its duties or by reason of its reckless disregard
of its obligations and duties under this Agreement.
(b) The Subadvisor agrees to indemnify and hold harmless
the Advisor, its officers and directors, and any person who "controls"
the Advisor, within the meaning of Section 15 of the 1933 Act, from and
against any and all direct or indirect liabilities, losses or damages
(including reasonable attorneys' fees and costs) suffered by Advisor
arising from or connected with (i) the Subadvisor's breach of its
duties under this Agreement, (ii) willful misfeasance, bad faith,
reckless disregard or gross negligence on the part of the Subadvisor or
any of its officers, directors or employees in the performance of the
Subadvisor's duties and obligations under this Agreement or (iii) any
untrue statement or alleged untrue statement of a material fact
contained in the Prospectus or Statement of Additional Information, as
amended or supplemented from time to time relating to the Designated
Series or any amendment thereof or any supplement thereto or the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statement therein not
misleading, if such a statement or omission was made in reliance upon
written information furnished by the Subadvisor or any affiliated
person of the Subadvisor to the Advisor, the Fund or any affiliated
person of the Advisor or the Fund expressly for use in the Fund's
registration statement, or upon verbal information confirmed by the
Subadvisor in writing expressly for use in the Fund's registration
statement; or (iv) to the extent of, and as a result of, the failure of
the Subadvisor to execute, or cause to be executed, portfolio
transactions according to the standards and requirements of the 1934
Act, the 1940 Act and the Advisers Act.
In no case shall the Subadvisor's indemnity in favor of the Advisor or
any affiliated person or controlling person of the Advisor, or any
other provision of this Agreement, be deemed to protect such person
against any liability to which any such person would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence
in the performance of its duties or by reason of its reckless disregard
of its obligations and duties under this Agreement.
12. Insurance. The Subadvisor shall, during the term of this Agreement, at
its own expense, maintain adequate liability and errors and omissions
insurance coverage to the reasonable satisfaction of the Advisor.
D-6
13. No Personal Liability. Reference is hereby made to the Declaration of
Trust, a copy of which has been filed with the Secretary of the
Commonwealth of Massachusetts and elsewhere as required by law, and to
any and all amendments thereto so filed or hereafter so filed with the
Secretary of the Commonwealth of Massachusetts and elsewhere as
required by law. The name The Phoenix Edge Series Fund refers to the
Trustees under said Declaration of Trust, as Trustees and not
personally, and no Trustee, shareholder, officer, agent or employee of
the Fund shall be held to any personal liability in connection with the
affairs of the Fund; only the Fund estate under said Declaration of
Fund is liable. Without limiting the generality of the foregoing,
neither the Subadvisor nor any of its officers, directors, partners,
shareholders or employees shall, under any circumstances, have recourse
or cause or willingly permit recourse to be had directly or indirectly
to any personal, statutory, or other liability of any shareholder,
Trustee, officer, agent or employee of the Fund or of any successor of
the Fund, whether such liability now exists or is hereafter incurred
for claims against the Fund estate.
14. Confidentiality. Subject to the duty of the Advisor or Subadvisor 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 Designated Series and
the actions of the Subadvisor and the Fund in respect thereof. It is
understood that any information or recommendation supplied by the
Subadvisor in connection with the performance of its obligations
hereunder is to be regarded as confidential and for use only by the
Advisor, the Fund or such persons as the Advisor may designate in
connection with the Designated Series who have agreed to maintain the
confidentiality of all such information. It is also understood that any
information supplied to the Subadvisor in connection with the
performance of its obligations hereunder, particularly, but not limited
to, any list of investments which, on a temporary basis, may not be
bought or sold for the Designated Series, is to be regarded as
confidential and for use only by the Subadvisor in connection with its
obligation to provide investment advice and other services to the
Designated Series. The parties acknowledge and agree that all nonpublic
personal information with regard to shareholders in the Designated
Series shall be deemed proprietary information of the Advisor, and that
the Subadvisor shall use that information solely in the performance of
its duties and obligations under this Agreement and shall takes
reasonable steps to safeguard the confidentiality of that information.
Further, the Subadvisor shall maintain and enforce adequate security
procedures with respect to all materials, records, documents and data
relating to any of its responsibilities pursuant to this Agreement
including all means for the effecting of investment transactions.
15. Assignment. This Agreement shall terminate automatically in the event
of its "assignment," as that term is defined in Section 2(a)(4) of the
1940 Act.
(a) To the extent consistent with applicable law the
Subadvisor shall provide the Advisor with reasonable advance written
notice of any proposed change of "control," as defined in Section
2(a)(9) of the 1940 Act, as will enable the Advisor to consider whether
an assignment as defined in Section 202 of the Advisers Act and Section
2(a)(4) of the 1940 Act will occur and to take the steps necessary
under applicable law and regulation. The Subadvisor will be liable to
the Fund and the Advisor for all direct and
D-7
indirect costs as defined below resulting from a change of control of
the Subadvisor, which causes an assignment, as such terms are defined
under the 1940 Act and the Advisers Act. Such costs are agreed to
include reimbursement of reasonable costs associated with distributing
an information statement to existing shareholders in the Designated
Series as required by the terms of the manager-of-managers exemptive
relief previously obtained by the Advisor of the Fund or a proxy
statement to existing shareholders in the Designated Series. In
addition the Subadvisor agrees to reimburse the Fund for costs
associated with printing and mailing any prospectus supplements
required to be distributed to existing shareholders to the Designated
Series by the 1940 Act, or rules or exemptive relief thereunder, as a
result of the Subadvisor's change of control. The Advisor agrees to
make such determination of a change of control or assignment in good
faith and to make every effort to mitigate costs.
(b) Notwithstanding the foregoing, no assignment shall be
deemed to result from any changes in the directors, officers, or
employees of Manager or Subadvisor except as may be provided to the
contrary in the 1940 Act or the rules and regulations thereunder. The
Subadvisor may perform its services through its employees or officers
or agents, and the Advisor shall not be entitled to the advice,
recommendation or judgment of any specific person; provided, however,
that the persons identified in the prospectus of the Designated Series
shall perform the portfolio management duties described therein until
the Subadvisor notifies the Advisor that one or more other employees or
officers or agents identified in such notice shall assume such duties
as of a specific date.
(c) The understandings and obligations set forth in this
Section shall survive the termination of this Agreement and shall be
binding upon the Subadvisor and its successors.
16. Representations, Warranties and Agreements of the Subadvisor. The
Subadvisor represents, warrants and agrees that:
(a) It is registered as an "investment advisor" under the
Advisers Act and will maintain such status so long as this Agreement
remains in effect.
(b) It shall comply with any other applicable federal or
state requirements, and the applicable requirements of any regulatory
or self-regulatory agency, necessary to be met for its performance of
the services contemplated by this Agreement so long as this Agreement
remains in effect.
(c) It is not prohibited by the 1940 Act, the Advisers
Act or other applicable federal or state law from performing the
services contemplated by this Agreement.
(d) It is duly organized and validly existing under the
laws of the State in which it was organized with the power to own and
possess its assets and carry on its business as it is now being
conducted.
D-8
(e) It has the power and has taken all necessary action,
and has obtained all necessary licenses, authorizations and approvals,
to execute this Agreement, which Agreement constitutes its legal, valid
and binding obligation, enforceable in accordance with its terms, to
enter into and perform the services contemplated by this Agreement; and
the execution, delivery and performance by it of this Agreement does
not contravene or constitute a default under any agreement binding upon
it.
(f) It will promptly notify the Advisor of the occurrence
of any event that would disqualify it from serving as an investment
advisor of an investment company pursuant to Section 9(a) of the 1940
Act or otherwise.
(g) It has a written code of ethics complying with the
requirements of Rule 17j-l under the 1940 Act and Rule 204A-1 of the
Advisers Act and will provide the Advisor with a copy of the code of
ethics and evidence of its adoption. The Subadvisor acknowledges
receipt of the written code of ethics adopted by and on behalf of the
Fund (the "Code of Ethics"). It will not be subject to the Code of
Ethics during the term of this Agreement so long as its code of ethics
complies with applicable regulatory requirements and has been approved
by the Trustees. Within 10 days of the end of each calendar quarter
while this Agreement is in effect, a duly authorized compliance officer
of the Subadvisor shall certify to the Fund and to the Advisor that the
Subadvisor has complied with the requirements of Rules 17j-l and 204A-1
of the Advisers Act during the previous calendar quarter and that there
has been no violation of its code of ethics, or if such a violation has
occurred, that appropriate action was taken in response to such
violation. The Subadvisor shall permit the Fund and Advisor to examine
the reports required to be made by the Subadvisor under Rule
17j-l(c)(1) or as required by law.
(h) It will use all necessary efforts to manage the
Designated Series so that it will satisfy the diversification and
minimum "good income" requirements of Subchapter M and the
diversification requirements of Section 817(h) of the Internal Revenue
Code of 1986, as amended.
(i) It has furnished a true and complete copy of its
registration statement as filed with the Securities and Exchange
Commission (the "Commission") on Form ADV to the Advisor and will
furnish promptly such updated copies of its registration statement or
amendments thereto as are filed with the Commission from time to time.
(j) It will furnish to the Advisor true and complete
copies of reports or other documents as may be reasonably requested by
the Advisor in connection with the performance of the Subadvisor's
duties and obligations under this Agreement.
(k) It will be responsible for the preparation and filing
of Schedule 13G and Form 13F on behalf of the Designated Series in
accordance with the requirements thereunder.
(l) It will furnish or otherwise make available to the
Advisor such other information relating to the business affairs of the
Subadvisor or the management of the Designated Series as the Advisor at
any time, or from time to time, reasonably requests in
D-9
connection with the Advisor's or Subadvisor's performance of its
respective obligations hereunder; subject, however, to the Subadvisor's
right to retain all such records as the Subadvisor is required to
maintain under the Advisers Act and the rules and regulations
promulgated thereunder; provided, further, that the Fund and the
Advisor shall be entitled to make and maintain copies of any records so
retained by the Subadvisor.
(m) It will maintain, keep current and preserve on behalf
of the Fund, in the manner required or permitted by the Advisers Act
and the Rules thereunder, the records identified in Schedule B (as
Schedule B may be amended from time to time). The Subadvisor agrees
that such records are the property of the Fund, and will be surrendered
to the Fund or to the Adviser as agent of the Fund promptly upon
request of either.
(n) The Subadvisor hereby warrants and represents that it
will provide the requisite certifications requested by the chief
executive office and chief financial officer of the Fund necessary for
those named officers to fulfill their reporting and certification
obligations on Form N-CSR as required under the Sarbanes-Oxley Act of
2002 in the form presented in Schedule E attached hereto and made a
part hereof.
(o) It has adopted and implemented, and throughout the
term of this Agreement shall maintain in effect and implement, policies
and procedures reasonably designed to prevent, detect and correct
violations by the Subadvisor and its supervised persons, and, to the
extent the activities of the Subadvisor in respect to the Fund could
affect the Fund, by the Fund, of "federal securities laws" (as defined
in Rule 38a-1 under the Act), and that the Subadvisor has provided the
Fund with true and complete copies of its policies and procedures (or
summaries thereof) and related information requested by the Fund. The
Subadvisor agrees to cooperate with periodic reviews by the Fund's
compliance personnel of the Subadvisor's policies and procedures, their
operation and implementation and other compliance matters and to
provide to the Fund from time to time such additional information and
certifications in respect of the Subadvisor's policies and procedures,
compliance by the Subadvisor with federal securities laws and related
matters and the Fund's compliance personnel may reasonably request. The
Subadvisor agrees to promptly notify the Advisor of any material
compliance violations which affect the Designated Series.
17. Representations, Warranties and Agreements of the Advisor. The Advisor
represents, warrants and agrees that:
(a) It is registered as an "investment advisor" under the
Advisers Act.
(b) It shall continue to meet any other applicable
federal or state requirements, or the applicable requirements of any
regulatory or self-regulatory agency, necessary to be met for its
performance of the services contemplated by this Agreement so long as
this Agreement remains in effect.
(c) It is not prohibited by the 1940 Act, the Advisers
Act or other applicable federal or state law from performing the
services contemplated by this Agreement.
D-10
(d) It is duly organized and validly existing under the
laws of the State in which it was organized with the power to own and
posses its assets and carry on its business as it is now being
conducted.
(e) It has the power and has taken all necessary action,
and has obtained all necessary licenses, authorizations and approvals,
to execute this Agreement, which Agreement constitutes its legal, valid
and binding obligation, enforceable in accordance with its terms, to
enter into and perform the services contemplated by this Agreement; and
the execution, delivery and performance by it of this Agreement does
not contravene or constitute a default under any agreement binding upon
it.
(f) It has delivered, or will before the effective date
of this Agreement deliver, to the Subadvisor true and complete copies
of (i) the Prospectus, (ii) the Declaration of Trust, and (iii) such
other documents or instruments governing the investments and investment
policies and practices of the Designated Series applicable to the
Subadvisor's duties and obligations hereunder, and during the term of
this Agreement will promptly deliver to the Subadvisor true and
complete copies of all documents and instruments supplementing,
amending, or otherwise becoming such documents or instruments before or
at the time they become effective.
(g) It will furnish or otherwise make available to the
Subadvisor such other information relating to the business affairs of
the Fund as the Subadvisor at any time, or from time to time,
reasonably requests in order to discharge its obligations hereunder.
18. Representations, Warranties and Agreements of the Fund. By their
approval of this Agreement the Trustees represent, warrant and agree
that:
(a) The Fund is not prohibited by the 1940 Act or other
applicable federal or state law from performing their obligations under
this Agreement.
(b) The Fund is duly organized and validly existing under
the laws of the State in which it was organized with the power to own
and posses its assets and carry on its business as it is now being
conducted.
(c) The Fund has taken all necessary action, and have obtained
all necessary licenses, authorizations and approvals, to permit the
Fund to enter into this Agreement, which Agreement constitutes the
Fund's legal, valid and binding obligation, enforceable in accordance
with its terms; and the execution, delivery and performance by the Fund
of this Agreement does not contravene or constitute a default under any
agreement binding upon the Fund.
19. Reports. The Subadvisor shall provide the Advisor and the Trustees such
periodic and special reports as the Advisor may reasonably request. The
Subadvisor agrees that such records are the property of the Fund, and
shall be made reasonably available for inspections, and by the Fund or
by the Advisor as agent of the Fund, and promptly upon request
surrendered to either. Without limiting the generality of the
foregoing, the parties agree and acknowledge that the Subadvisor shall
provide the following items:
D-11
(a) Quarterly reports, in form and substance acceptable
to the Advisor, including but not limited to reports with respect to:
(i) compliance with the Subadvisor's code of ethics; (ii) compliance
with procedures adopted from time to time by the Trustees relative to
securities eligible for resale pursuant to Rule 144A under the 1933
Act; (iii) diversification of Designated Series assets in accordance
with the then governing laws and prevailing Prospectus pertaining to
the Designated Series; (iv) compliance with governing Fund policies and
restrictions relating to the fair valuation of securities for which
market quotations are not readily available or considered "illiquid"
for the purposes of complying with the Designated Series limitation on
acquisition of illiquid securities; (v) cross transactions conducted
pursuant to Rule 17a-7 under the 1940 Act; (vi) allocations of
brokerage transactions along with descriptions of the bases for those
allocations and the receipt and treatment of brokerage and research
services received, as may be requested to ensure compliance with
Section 28(e) of the 1934 Act; (vii) any and all other reports
reasonably requested in accordance with or described in this Agreement;
and, (viii) the implementation of the Designated Series investment
program, including, without limitation, analyses of Designated Series
performance;
(b) Annual or other periodic reports, in form and
substance acceptable to the Advisor, including but not limited reports
with respect to: (i) analyses of Designated Series performance; (ii)
disclosure related to the portfolio management of the Designated Series
and the Subadvisor as may be contained in the Prospectus or marketing
materials as amended, supplemented or otherwise updated from time to
time; and (iii) foreign custody arrangements as governed by Rule 17f-7
under the 1940 Act; (iv) compliance with the Subadvisor's code of
ethics pursuant to Rule 17j-1; and (v) such compliance certifications
as may be reasonably requested.
(c) The parties acknowledge and agree that the Subadvisor
is authorized to supply the Fund's independent accountants,
PricewaterhouseCoopers LLP, or any successor accountant for the Fund,
any information that they may request in connection with the Fund.
In addition, the Subadvisor shall immediately notify and forward to
both the Advisor and any legal counsel for the Designated Series whose
identity has been provided to the Subadvisor any legal process served
upon it on behalf of the Advisor or the Fund. The Subadvisor shall
promptly notify the Advisor of any changes in any information
concerning the Subadvisor of which the Subadvisor becomes aware that is
or would be required to be disclosed in the Fund's registration
statement.
20. Proxies. The Subadvisor shall review all proxy solicitation materials
and be responsible for voting and handling all proxies in relation to
the Assets of the Designated Series, such costs to be borne by the
Subadvisor except as limited in this paragraph below. Unless the
Advisor or the Fund gives the Subadvisor written instructions to the
contrary, the Subadvisor will, in compliance with the Subadvisor's
proxy voting policy as provided in writing to the Advisor, vote or
abstain from voting, all proxies solicited by or with respect to the
issuers of securities in which assets of the Designated Series may be
invested. The Subadvisor will vote proxies in the best interests of
clients consistent with the Subadvisor's Client Proxy Standard, as
defined and disclosed in the proxy voting
D-12
policy. The Advisor shall cause the Custodian to forward promptly to
the Subadvisor all proxies upon receipt, so as to afford the Subadvisor
a reasonable amount of time in which to determine how to vote such
proxies. The Subadvisor agrees to provide the Advisor in a timely
manner with annual proxy voting reports containing a record of votes
cast containing all of the voting information required to be filed on
Form N-PX pursuant to Rule 30b1-4 under the Act, such proxy voting
reports to be provided in the standard format provided by the
Subadvisor's proxy administrator and research provider. In the event
the Advisor or Fund desires any customization or alteration of the
standard format of proxy voting reports as provided by the Subadvisor's
proxy administrator and research provider, any additional cost incurred
as a result of such customization or alteration shall be borne by the
Advisor or the Fund.
21. Valuation of Assets and Related Recordkeeping. The Subadvisor shall
assist the recordkeeping agent for the Fund in determining or
confirming the value of any securities or other assets in the
Designated Series for which the recordkeeping agent seeks assistance
from or identifies for review by the Advisor.
22. Amendment. This Agreement may be amended at any time, but only by
written agreement between the Subadvisor and the Advisor, which
amendment, other than amendments to Schedule A, B, C, D or E, is
subject to the approval of the Trustees and the Shareholders of the
Fund as and to the extent required by the 1940 Act.
23. Effective Date; Term. This Agreement shall become effective on the date
set forth on the first page of this Agreement. Unless terminated as
hereinafter provided, this Agreement shall remain in full force and
effect until November 30, 2007, and thereafter only so long as its
continuance has been specifically approved at least annually in
accordance with Sections 15(a) and (c) of the 1940 Act and the Rules
promulgated thereunder.
24. Notices. Except as otherwise provided in this Agreement, all notices or
other communications required of permitted to be given hereunder shall
be in writing and shall be delivered or sent by (i) confirmed
facsimile, (ii) registered, certified or overnight mail, or (iii) a
nationally recognized overnight courier, to the following addresses or
to such other address as the relevant addressee shall hereafter provide
for such purpose to the other by notice in writing and shall be deemed
to have been given at the time of delivery.
If to the Advisor: PHOENIX VARIABLE ADVISORS, INC.
One American Row
Hartford, Connecticut
Attn: Doreen A. Bonner
Telephone: (860) 403-5456
Facsimile: (860) 403-5262
Email: Doreen.Bonner@phoenixwm.com
If to the Subadvisor: MORGAN STANLEY INVESTMENT
MANAGEMENT INC.
1221 Avenue of the Americas
New York, New York 10020
D-13
Attn: Kimberley Haynes Costello, Esq.
Telephone: 212-762-4543
Facsimile: 212-507-8432
Email: Kim.Costello@morganstanley.com
25. Termination. This Agreement shall terminate immediately in the event of
its assignment, as specified above in Section 14 of this Agreement.
This Agreement may be terminated by either party, without penalty,
immediately upon written notice to the other party in the event of a
breach of any provision thereof by the party so notified, or otherwise,
by the Advisor, Subadvisor, Board of Trustees of the Fund or vote of a
majority of the outstanding voting securities of the Designated Series
upon sixty (60) days' written notice to the other party.
Notwithstanding such termination, any liability of a party to any other
party under this Agreement shall survive and remain in full force and
effect with respect to any claim or matter on which any party has given
written notice to any other party prior to termination and until such
liability has been finally settled.
26. Use of Morgan Stanley and Other Proprietary Names. The Subadvisor
hereby authorizes the Advisor to use the branded name "Van Kampen" in
the Fund's Prospectus and Statement of Additional Information, as well
as in any advertisement or sales literature used by the Advisor or its
agents to promote the Fund and/or to provide information to
shareholders of the Designated Series ("Fund Material"), for so long as
the Subadvisor is an investment adviser to the Designated Series. The
Advisor agrees not to use the name "Morgan Stanley" in any Fund
Material unless permitted and approved by the Subadvisor; provided,
however, that the Advisor may use such name where (i) in the opinion of
counsel to the Advisor or the Fund, or as directed by the SEC, such use
is necessary to make the disclosures contained in the Fund Material not
misleading and (ii) the Advisor provides the Subadvisor with prompt
notice of the required disclosure. It is understood that the names
"Morgan Stanley" or "Van Kampen" and any derivative thereof or logos
associated with such names (collectively, the "MS Names"), are the
valuable property of the Subadvisor and its affiliates and that the
Advisor and/or the Fund shall only have the right to use the MS Names
in Fund Materials subject to the constraints set forth in this
paragraph and with the prior approval of the Subadvisor. Upon
termination of this Agreement, the Advisor and the Fund shall, as soon
as it reasonably possible, cease to use the MS Names.
27. 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 State of New York, without giving effect to the conflicts of laws
principles thereof.
28. 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.
D-14
29. Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to the subject matter of this
Agreement.
30. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all such
counterparts shall constitute a single instrument.
THE PHOENIX EDGE SERIES FUND
By:/s/ Gina Collopy O'Connell
-------------------------------------
Name: Gina Collopy O'Connell
Title: Senior Vice President
PHOENIX VARIABLE ADVISORS, INC.
By: /s/ John H. Beers
------------------------------------
Name: John H. Beers
Title: Vice President and Secretary
ACCEPTED:
MORGAN STANLEY INVESTMENT MANAGEMENT INC.
By:/s/ Michael P. Kiley
---------------------------------
Name: Michael P. Kiley
Title: Managing Director
SCHEDULES: A. Operational Procedures
B. Record Keeping Requirements
C. Fee Schedule
D. Subadvisor Functions
E. Forms of Sub-Certification
D-15
SCHEDULE A
----------
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, and PFPC, Inc., (the "Sub-Accounting
Agent").
The Subadvisor must furnish the Custodians and Sub-Accounting Agent with daily
information as to executed trades, or, if no trades are executed, with a report
to that effect, no later than 7:00 p.m. (Eastern time) each day the Fund is open
for business. The necessary information may be sent electronically or via
facsimile machine to the Custodians and the Sub-Accounting Agent. Information
provided to the Custodians and the Sub-Accounting Agent 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;
14. Currency for foreign trades;
15. Ticker symbol for domestic trades; and
16. Identified tax lot (if applicable).
When opening accounts with brokers for, and in the name of, the Fund, the
account must be a cash account. No margin accounts are to be maintained in the
name of the Fund. Delivery instructions are as specified by the Custodians. The
Custodians and Sub-Accounting Agent will supply the Subadvisor with a cash
availability report by email or by facsimile and the Sub-Accounting Agent will
provide a five day cash projection on a daily basis no later than 10:00 a.m.
(Central Time). This will normally be done electronically or via facsimile
machine so that the Subadvisor will know the amount available for investment
purposes.
D-16
SCHEDULE B
----------
RECORDS TO BE MAINTAINED BY THE SUBADVISOR
1. (Rule 31a-1(b)(5)) A record of each brokerage order, and all other
portfolio purchases and sales, given by the Subadvisor on behalf of the
Designated Series 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
cancellation 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 Designated 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 Advisor,
(c) The Subadvisor, 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. Shall show 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 records in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the
purchase or sale of portfolio securities. Where a committee or group
makes an authorization, a record shall be kept of the names of its
members who participate in the authorization. There shall be retained
as
D-17
part of this record: any memorandum, recommendation or instruction
supporting or authorizing the purchase or sale of portfolio 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
Subadvisor's transactions for the Designated Series.
- -----------------------------
* 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 subadvisor review. It is acknowledged that dissemination of certain
proprietary research or other data may not be permissible.
D-18
SCHEDULE C
----------
SUBADVISORY FEE
For services provided to the Fund, the Advisor will pay to the Subadvisor, on or
before the 10th day of each month, a fee, payable in arrears, at the annual rate
stated below. The fees shall be prorated for any month during which this
Agreement is in effect for only a portion of the month. In computing the fee to
be paid to the Subadvisor, the net asset value of the Fund and each Designated
Series shall be valued as set forth in the then current registration statement
of the Fund.
Phoenix-Van Kampen Comstock Series: 0.35%
Phoenix-Van Kampen Comstock Series was previously known as Phoenix-Engemann
Value Equity Series.
D-19
SCHEDULE D
----------
SUBADVISOR FUNCTIONS
With respect to managing the investment and reinvestment of the
Designated Series' assets, the Subadvisor shall provide, at its own expense:
(a) An investment program for the Designated 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 Advisor, all as set forth in the Objectives and Policies;
(b) Implementation of the investment program for the Designated Series
based upon the foregoing criteria;
(c) Quarterly reports, in form and substance acceptable to the Advisor,
with respect to: (i) compliance with the 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
Designated Series assets in accordance with the then prevailing
Objectives and Policies 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 Designated Series'
limitation on acquisition of illiquid securities included in the
Objectives and Policies; (v) any and all other reports reasonably
requested in accordance with or described in this Agreement; and (vi)
the implementation of the Designated Series' investment program,
including, without limitation, analysis of Designated Series
performance;
(d) Promptly after filing with the Securities and Exchange Commission an
amendment to its Form ADV, a copy of such amendment to the Advisor and
the Trustees;
(e) Attendance by appropriate representatives of the Subadvisor at meetings
requested by the Advisor or Trustees at such time(s) and location(s) as
reasonably requested by the Advisor or Trustees; and
(f) Notice to the Trustees and the Advisor of the occurrence of any event
which would disqualify the Subadvisor from serving as an investment
advisor of an investment company pursuant to Section 9(a) of the 1940
Act or otherwise.
D-20
SCHEDULE E
----------
FORM OF OPERATIONS N-CSR SUB-CERTIFICATION
To:
Re: Form N-CSR Certification for the Phoenix Van Kampen Comstock Series
(the "Designated Series") of The Phoenix Edge Series Fund (the "Fund")
From: Morgan Stanley Investment Management Inc. (the "Subadvisor")
Representations in support of Investment Company Act Rule 30a-2 certifications
In connection with your certification responsibility under Rule 30a-2 and
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, I have reviewed the
following information presented for the period ended [Date of Reporting Period]
(the "Reporting Period") for the Designated Series.
I, _____________, [TITLE] (Operations) of the Subadvisor, certify with respect
to the Designated Series of the Fund for the Reporting Period, and only with
respect to my area of responsibility that:
1. I have reviewed the names of securities and numbers of shares for
each security listed in the Schedule of Investments as of ______
for the Fund (the "Schedule"), copies of which are attached as
Exhibit A;
2. Based on my knowledge, the names of securities and numbers of
shares for each security listed in each Schedule is accurate,
except as set forth in the attached Exhibit B for the __________;
3. Based on my knowledge, the Subadvisor's Operations Department (the
"Operations Department") has transmitted materially complete and
accurate portfolio transaction information to the Fund's custodian
with respect to every portfolio transaction the manager has
entered into on behalf of the Fund during the Reporting Period;
4. The Operations Department has in place and has observed internal
controls and procedures that are reasonably designed to ensure
that all portfolio transactions with respect to the Fund are
promptly and accurately reported to the Fund's custodian and that
the Operations Department is able to maintain an accurate record
of the Fund's portfolio security positions that were reported to
the Fund's custodian;
5. Internal controls and procedures with respect to personnel of the
Operations Department have been most recently evaluated for
effectiveness within 90 days prior to the end of the Reporting
Period and were found to be effective;
6. As of the date hereof there have been no material changes to or
violations of the internal controls and procedures of the
Operations Department;
D-21
7. I am not aware of significant deficiencies in the design or
operation of the internal controls and procedures of the
Operations Department that could materially adversely affect the
Operations Department's transmission of portfolio transaction
information to the Fund's custodian; and
8. Based on my knowledge, I am not aware of any fraud committed by
Operations Department personnel that have a significant role in
the internal controls of the Operations Department that affect the
Fund.
This certification relates solely to the Series named above and may not be
relied upon by any other fund or entity.
The Subadvisor does not maintain the official books and records of the above
Series. The Subadvisor's records are based on its own portfolio management
system, a record-keeping system that is not intended to service the Funds'
official accounting system. The Subadvisor is not responsible for the
preparation of the reports.
Date: ______________________________ By: ___________________________________
Print Name:________________________
Title: ____________________________
D-22
EXHIBIT A
SCHEDULE OF INVESTMENTS AT ________
D-23
EXHIBIT B
SCHEDULE OF INVESTMENTS AT ________
_______ FUND
- ------------------------------------------------------------------------------------------------------------------------------------
A B C D E F G I
- ------------- ------------- ------------- ------------- -------------- -------------- ------------- --------------------------------
RECON SECURITY MSIM INC. VARIANCE VARIANCE AS
DATE DESCRIPTION/ IM2 CUSTOMER (QTY) VARIANCE VALUE % OF IM2 COMMENTS FOR THE DIFFERENCE
IDENTIFIER QUANTITY QUANTITY (C-D) (USD) PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------------------
D-24
FORM OF INVESTMENTS N-CSR SUB-CERTIFICATION
To:
Re: Form N-CSR Certification for the Phoenix Van Kampen Comstock Series
(the "Designated Series") of The Phoenix Edge Series Fund (the "Fund")
From: Morgan Stanley Investment Management Inc. (the "Subadvisor")
Representations in support of Investment Company Act Rule 30a-2 certifications
In connection with your certification responsibility under Rule 30a-2 and
Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, I have reviewed the
following information presented for the period ended [Date of Reporting Period]
(the "Reporting Period") for the Designated Series.
I, _____________, [TITLE] (Investments) of the Subadvisor, certify with respect
to the Designated Series of the Fund for the Reporting Period, and only with
respect to my area of responsibility that:
1. The Subadvisor's Investments Department has reviewed management's
discussion of fund performance ("MDFP"), as attached hereto, and,
to the knowledge of the Subadvisor's Investments Department, the
information contained in MDFP as provided by the Subadvisor's
Investments Department does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the
period covered by the Report; and
2. The Subadvisor's Investments Department will promptly report to
the Fund any change in circumstances that would cause the
preceding certification to be untrue.
3. The Subadvisor has complied with the Prospectus and Statement of
Additional Information of the Designated Series and the Policies
and Procedures of the Series as adopted by the Designated Series'
Board of Trustees.
4. I have reviewed the Schedule of Investments as of _______________,
for the Fund, and none of the investments is a restricted security
or otherwise illiquid.
This certification relates solely to the Series named above and may not be
relied upon by any other fund or entity.
The Subadvisor does not maintain the official books and records of the above
Series. The sub-Subadvisor's records are based on its own portfolio management
system, a record-keeping system that is not intended to service the Funds'
official accounting system. The Subadvisor is not responsible for the
preparation of the reports.
Date: _______________________________ By: __________________________________
Print Name:_______________________
Title:____________________________
D-25
FORM OF OPERATIONS N-Q SUB-CERTIFICATION
To:
Re: Form N-Q Certification for the Phoenix Van Kampen Comstock Series (the
"Designated Series") of The Phoenix Edge Series Fund (the "Fund")
From: Morgan Stanley Investment Management Inc. (the "Subadvisor")
Representations in support of Investment Company Act Rule 30b1-5 certifications
In connection with your certification responsibility under Rule 30b1-5, I have
reviewed the following information presented for the period ended [Date of
Reporting Period] (the "Reporting Period") for the Designated Series.
I, _____________, [TITLE] (Operations) of the Subadvisor, certify with respect
to the Designated Series of the Fund for the Reporting Period, and only with
respect to my area of responsibility that:
1. I have reviewed the names of securities and numbers of shares for
each security listed in the Schedule of Investments as of ______
for the Fund (the "Schedule"), copies of which are attached as
Exhibit A;
2. Based on my knowledge, the names of securities and numbers of
shares for each security listed in each Schedule is accurate,
except as set forth in the attached Exhibit B for the __________;
3. Based on my knowledge, the Subadvisor's Operations Department (the
"Operations Department") has transmitted materially complete and
accurate portfolio transaction information to the Fund's custodian
with respect to every portfolio transaction the manager has
entered into on behalf of the Fund during the Reporting Period;
4. The Operations Department has in place and has observed internal
controls and procedures that are reasonably designed to ensure
that all portfolio transactions with respect to the Fund are
promptly and accurately reported to the Fund's custodian and that
the Operations Department is able to maintain an accurate record
of the Fund's portfolio security positions that were reported to
the Fund's custodian;
5. Internal controls and procedures with respect to personnel of the
Operations Department have been most recently evaluated for
effectiveness within 90 days prior to the end of the Reporting
Period and were found to be effective;
6. As of the date hereof there have been no material changes to or
violations of the internal controls and procedures of the
Operations Department;
7. I am not aware of significant deficiencies in the design or
operation of the internal controls and procedures of the
Operations Department that could materially adversely
D-26
affect the Operations Department's transmission of portfolio
transaction information to the Fund's custodian; and
8. Based on my knowledge, I am not aware of any fraud committed by
Operations Department personnel that have a significant role in
the internal controls of the Operations Department that affect the
Fund.
This certification relates solely to the Series named above and may not be
relied upon by any other fund or entity.
The Subadvisor does not maintain the official books and records of the above
Series. The sub-Subadvisor's records are based on its own portfolio management
system, a record-keeping system that is not intended to service the Funds'
official accounting system. The Subadvisor is not responsible for the
preparation of the reports.
Date: _______________________________ By: __________________________________
Print Name:_______________________
Title:____________________________
D-27
EXHIBIT A
SCHEDULE OF INVESTMENTS AT ________
D-28
EXHIBIT B
SCHEDULE OF INVESTMENTS AT ________
_______ FUND
- ------------------------------------------------------------------------------------------------------------------------------------
A B C D E F G I
- ------------- ------------- ------------- ------------- -------------- -------------- ------------- --------------------------------
RECON SECURITY MSIM INC. VARIANCE VARIANCE AS
DATE DESCRIPTION/ IM2 CUSTOMER (QTY) VARIANCE VALUE % OF IM2 COMMENTS FOR THE DIFFERENCE
IDENTIFIER QUANTITY QUANTITY (C-D) (USD) PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------------------
D-29
FORM OF INVESTMENTS N-Q SUB-CERTIFICATION
To:
Re: Form N-Q Certification for the Phoenix Van Kampen Comstock Series (the
"Designated Series") of The Phoenix Edge Series Fund (the "Fund")
From: Morgan Stanley Investment Management Inc. (the "Subadvisor")
Representations in support of Investment Company Act Rule 30b1-5 certifications
In connection with your certification responsibility under Rule 30b1-5, I have
reviewed the following information presented for the period ended [Date of
Reporting Period] (the "Reporting Period") for the Designated Series.
I, _____________, [TITLE] (Investments) of the Subadvisor, certify with respect
to the Designated Series of the Fund for the Reporting Period, and only with
respect to my area of responsibility that:
1. The Subadvisor has complied with the Prospectus and Statement of
Additional Information of the Designated Series and the Policies
and Procedures of the Series as adopted by the Designated Series'
Board of Trustees.
2. I have reviewed the Schedule of Investments as of _______________,
for the Fund, and none of the investments is a restricted security
or otherwise illiquid.
This certification relates solely to the Series named above and may not be
relied upon by any other fund or entity.
The Subadvisor does not maintain the official books and records of the above
Series. The sub-Subadvisor's records are based on its own portfolio management
system, a record-keeping system that is not intended to service the Funds'
official accounting system. The Subadvisor is not responsible for the
preparation of the reports.
Date: _______________________________ By: __________________________________
Print Name:_______________________
Title:____________________________
D-30
FORM OF COMPLIANCE SUB-CERTIFICATION
To:
Re: Code of Ethics Certification for the Phoenix Van Kampen Comstock Series
(the "Designated Series") of The Phoenix Edge Series Fund (the "Fund")
From: Morgan Stanley Investment Management Inc. (the "Subadvisor")
Representations in support of Investment Company Act Rule 30a-2
certifications
In connection with your certification responsibility under Rule 30a-2
and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, I have
reviewed the following information presented for the period ended [Date
of Reporting Period] (the "Reports") for the Designated Series.
Code of Ethics
--------------
I certify that to the best of my knowledge, and only with respect to my area of
responsibility:
a. The Subadvisor's portfolio manager has materially complied with
the restrictions and reporting requirements of the Subadvisor's
Code of Ethics (the "Code").
b. The Subadvisor has complied with the Prospectus and Statement of
Additional Information of the Designated Series and the Policies
and Procedures of the Series as adopted by the Designated Series'
Board of Trustees.
c. I have no knowledge of any compliance violations with respect to
the Designated Series except as disclosed in writing to the
Phoenix Compliance Department by me or by the Subadvisor's
compliance administrator.
d. The Subadvisor has complied with the rules and regulations of the
33 Act and 40 Act, and such other regulations as may apply to the
extent those rules and regulations pertain to the responsibilities
of the Subadvisor with respect to the Designated Series as
outlined above.
This certification relates solely to the Designated Series named above and may
not be relied upon by any other fund or entity.
The Subadvisor does not maintain the official books and records of the
Designated Series. The Subadvisor's records are based on its own portfolio
management system, a record-keeping system that is not intended to service as
the Fund's official accounting system. The Subadvisor is not responsible for the
preparation of the Reports.
Date: _______________________________ By: __________________________________
Print Name:_______________________
Title:____________________________
D-31