UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities Exchange
Act of 1934 (Amendment No. )
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14c-5(d)(2))
[X] Definitive Information Statement
THE PHOENIX EDGE SERIES FUND
(Name of Registrant As Specified In Its Charter)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rule
14c-5(g) and 0-11
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Rule 0-11 (Set forth the amount on which the filing fee is calculated
and how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offset fee was paid previously.
Identify the previous filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
-2-
THE PHOENIX EDGE SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
February 21, 2008
Dear Policy or Contract Owner:
Effective as of the close of business on November 26, 2007, Phoenix Variable
Advisors, Inc. ("PVA") terminated Bennett Lawrence Management LLC ("Bennett
Lawrence") as the subadvisor for the Phoenix Mid-Gap Growth Series, a series of
The Phoenix Edge Series Fund (the "Fund"). 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 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 to the Board of Trustees. Upon termination
of Bennett Lawrence, PVA hired Neuberger Berman Management, Inc. ("Neuberger
Berman"), as the new subadvisor to the Fund.
Some or the entire variable portion of your variable life insurance policy or
your variable annuity contract, issued by the separate accounts of Phoenix Life
Insurance Company ("PLIC"), PHL Variable Insurance Company ("PHL Variable"), or
Phoenix Life and Annuity Company ("PLAC") (collectively, "Phoenix"), is invested
in shares of the Phoenix Mid-Cap Growth Series. As a condition of the Order, PVA
and the Fund must provide you with the enclosed Information Statement to update
you with respect 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
-3-
INFORMATION STATEMENT
THE PHOENIX EDGE SERIES FUND
101 Munson Street
Greenfield, Massachusetts 01301
The Phoenix Edge Series Fund ("Fund") serves as an investment vehicle for
variable life insurance policies and variable annuity contracts (collectively,
"Contracts") issued by the separate accounts of Phoenix Life Insurance Company
("PLIC"), PHL Variable Insurance Company ("PHL Variable") and Phoenix Life and
Annuity Company ("PLAC") (collectively, "Phoenix"). Phoenix and the separate
accounts are the sole shareholders of record of the Fund. Some or the entire
variable portion of your Contract 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
18 separate investment portfolios, including the Phoenix Mid-Cap Growth Series
(the "Series") as of January 1, 2008. Phoenix Variable Advisors, Inc. ("PVA"),
acts as the investment advisor to the Series and is located at One American Row,
Hartford, CT 06103-2899.
Effective as of the close of business on November 26, 2007, PVA terminated
Bennett Lawrence Management LLC ("Bennett Lawrence") as subadvisor for the
Series. Upon termination of Bennett Lawrence, PVA hired Neuberger Berman
Management, Inc. ("Neuberger Berman"), as the new subadvisor for the Series.
Neuberger Berman's principal place of business is located at 605 Third Avenue,
New York, New York 10158.
PVA and the Fund have been granted an exemptive order (the "Order") from the SEC
that permits PVA and the Fund 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 to the Board of Trustees. As a condition of the Order, PVA and
the Fund must provide you with this Information Statement to update you with
respect to this subadvisory change. More information about the Order is provided
below. This Information Statement is being sent to shareholders on or about
February 25, 2008.
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.
THE TRANSACTION
At a special meeting of the Fund's board of trustees (the "Board") held on
September 26, 2007, the Board approved PVA's recommendation to terminate the
Subadvisory Agreement between PVA and Bennett Lawrence, dated August 12, 2005
(the "Old Subadvisory Agreement"), to be effective on November 26, 2007. On
Monday, September 27, 2007, PVA notified Bennett Lawrence that on November 26,
2007, PVA would terminate Bennett Lawrence as subadvisor to the Series.
At a regular meeting of the Fund's Board held November 12-13, 2007, PVA reported
that as part of the subadvisor oversight process, PVA had considered and
reviewed several investment advisory firms to manage the Series and was prepared
to recommend Neuberger Berman as the new subadvisor for the Series as permitted
under the Order. The Board approved the appointment of Neuberger Berman as
successor subadvisor for the Series effective November 27, 2007, and approved
the Subadvisory Agreement between PVA and Neuberger Berman dated the same date
(the "New Subadvisory Agreement"). A copy of the New Subadvisory Agreement is
attached as Exhibit A. On November 27, 2007, Neuberger Berman became the new
Subadvisor for the Series. The transaction set forth above was approved by all
members 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").
Contractholders and policyowners who have directed the allocation of their
investment to a subaccount corresponding to the Series have received this
Information Statement. Subject to the Fund's Disruptive Trading policy
designed to discourage and prevent market timing and excessive trading by
investors, which can be harmful
-4-
to other investors of the Fund's series, contractholders and policyowners may at
any time elect to transfer their investment into any other subaccount available
through their Contracts without other restrictions on the transfer.
THE OLD SUBADVISORY AGREEMENT
Under the Old Subadvisory Agreement between PVA and Bennett Lawrence, dated
August 12, 2005, Bennett Lawrence provided portfolio management services for the
Series. The annual rate of fees paid to Bennett Lawrence by PVA (not the Series)
was 0.40% of the average daily net assets in the Series. The advisory fee paid
to PVA by the Series is 0.80% of the average daily net assets in the Series. For
the Series' fiscal year ended December 31, 2007, the advisory fee paid to PVA by
the Series was $702,882, and the subadvisory fees paid by PVA to Bennett
Lawrence from January 1, 2007 through November 26, 2007 was $317,734.
Under the Old Subadvisory Agreement, Bennett Lawrence provided a continuous
investment program to the Series, including making decisions regarding the
purchase, retention or disposition of securities or other assets that the Series
may have owned or contemplated acquiring from time to time. All services under
the Old Subadvisory 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 the Series as disclosed in the Fund's registration
statement on file with the SEC, as amended from time to time.
Bennett Lawrence had the exclusive authority to manage the investment and
reinvestment of the assets of the Series, subject to the discretion and control
of PVA and the Board. Bennett Lawrence provided an investment program for the
Series consistent with the Series' investment objectives based upon the
development, review and adjustment of the investment policies approved from time
to time by the Board and PVA in consultation with Bennett Lawrence. Bennett
Lawrence agreed to use its best professional judgment to make investment
decisions for the Series in accordance with the terms of the old Subadvisory
Agreement.
Unless instructed otherwise by PVA, Bennett Lawrence placed all orders for the
purchase and sale of investments for the Series with brokers or dealers selected
by Bennett Lawrence, which may have included brokers or dealers affiliated with
Bennett Lawrence. Bennett Lawrence used its best efforts to obtain the best
execution of transactions at prices that were advantageous to the Series and at
commission rates that were reasonable in relation to the benefits received.
Bennett Lawrence 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 Bennett Lawrence. Bennett Lawrence 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 Bennett Lawrence 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 the Series and other accounts over which Bennett Lawrence exercised
investment discretion. Not all services or products provided by brokers or
dealers that were generated with Series commissions were necessarily used by
Bennett Lawrence in managing the Series, but may have been allocated among other
accounts, as appropriate.
The Old Subadvisory Agreement between PVA and Bennett Lawrence remained in full
force and effect only so long as its continuance was 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 Subadvisory Agreement could 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, upon sixty (60) days' written notice to the other party.
Any such termination would not have affected the status, obligations or
liabilities of either party. The Old Subadvisory Agreement was last considered
and renewed by the Board November 13-14, 2006.
THE NEW SUBADVISORY AGREEMENT
The New Subadvisory Agreement between PVA and Neuberger Berman provides that
Neuberger Berman will provide a continuous investment program to the Series. The
monthly subadvisory fees payable to Neuberger Berman from PVA (not the Series)
are as follows: 0.425% for the first $500 million of average daily net assets in
the Series, and 0.40% on average daily net assets in excess of $500 million.
There are no differences between the Old and New
-5-
Subadvisory Agreements except fees, the change in dates and subadvisors. The
advisory fee paid to PVA by the Series continues to be 0.80% of the average
daily net assets in the Series. The fee is calculated daily and paid monthly.
From November 27, 2007 through December 31, 2007, PVA paid Neuberger Berman
$35,813 in subadvisory fees. The asset size of the Series as of December 31,
2007 was $87,252,941.
The following table shows the actual aggregate subadvisory fee paid by PVA for
the fiscal year ended December 31, 2007 under the Old Subadvisory Agreement and
what the aggregate subadvisory fee would have been if the subadvisory fee under
the New Subadvisory Agreement had been in effect during that period:
<table>
<caption>
- ------------------------------------------ ---------------------------------------- ----------------------------------
Actual Aggregate Subadvisory Fee paid Pro Forma Aggregate Subadvisory Fee % Difference Between Actual and
under the Old Subadvisory Agreement for paid under the New Subadvisory Pro Forma Aggregate Subadvisory
Fiscal Year Ended December 31, 2007 Agreement for Fiscal Year Ended Fees
December 31, 2007
- ------------------------------------------ ---------------------------------------- ----------------------------------
<s> <c> <c>
$353,547 $373,398 5.6%
- ------------------------------------------ ---------------------------------------- ----------------------------------
</table>
The New Subadvisory Agreement dated November 27, 2007, is attached to this
Information Statement as Exhibit A.
Neuberger Berman will provide investment subadvisory services to the Series,
including making decisions regarding the purchase, retention or disposition of
securities or other assets that the Series 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, any policies
adopted by the Board, and the investment policies of the Series as disclosed in
the Fund's registration statement on file with the SEC, as amended from time to
time.
Neuberger Berman will have the exclusive authority to manage the investment and
reinvestment of the assets of the Series, subject to the discretion and control
of PVA and the Board. Neuberger Berman will provide an investment program for
the 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 Neuberger Berman. Neuberger
Berman has agreed to use its best professional judgment to make investment
decisions for the Series in accordance with the terms of the New Subadvisory
Agreement.
Unless instructed otherwise by PVA, Neuberger Berman will place all orders for
the purchase and sale of investments for the Series with brokers or dealers
selected by Neuberger Berman. Neuberger Berman will use its best efforts to
obtain the best execution of transactions at prices that are advantageous to the
Series and at commission rates that are reasonable in relation to the benefits
received. Neuberger Berman 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 Neuberger Berman. Neuberger Berman 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 Neuberger Berman 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 the Series and other
accounts over which Neuberger Berman exercises investment discretion. Not all
services or products provided by brokers or dealers that are generated with
Series commissions will necessarily be used by Neuberger Berman in managing the
Series, but may be allocated among other accounts, as appropriate. Neuberger
Berman does not have a broker/dealer that passes through the Fund.
Unless terminated, the New Subadvisory Agreement will remain in full force and
effect until December 31, 2008, 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).
-6-
BOARD CONSIDERATIONS
As previously mentioned, at a regular meeting held on November 12-13, 2007, the
Board, including a majority of the Disinterested Trustees, approved a proposal
by PVA to replace Bennett Lawrence with Neuberger Berman as subadvisor to the
Series.
The Board reviewed performance information for the Series and noted that as a
result of disappointing performance, the recommendation of a new subadvisor was
appropriate. In connection with the consideration of PVA's proposal to replace
Bennett Lawrence with Neuberger Berman as subadvisor to the Series, the Board
received in advance of the meeting, certain information in the form of an
extensive questionnaire completed by Neuberger Berman concerning a number of
issues, including its investment philosophy, resources, operations and
compliance structure. In this context, the Trustees considered PVA's
quantitative and qualitative evaluation of Neuberger Berman's skills and
abilities in managing assets pursuant to specific investment styles similar to
the style of the Series. The Board had further benefit of a presentation made by
Neuberger Berman's senior management personnel where a number of issues,
including Neuberger Berman's history, investment approach, investment
strategies, portfolio turnover rates, assets under management, personnel,
compliance procedures 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
Neuberger Berman. The Board was satisfied that the financial statements of
Neuberger Berman indicated it was sufficiently capitalized, and that its 1-, 3-
and 5-year performance for funds similar to the Series was strong. The Board
noted that its similarly managed funds outperformed the Russell Mid Cap Growth
Index over the one- and three-year periods, and further noted that Neuberger
Berman's consistent investment style had produced strong results over a long
period of time.
In considering the profitability to Neuberger Berman of its relationship with
the Series, the Board noted that the fees under the New Subadvisory Agreement
would be paid by PVA out of the advisory fees that it receives under the
Advisory Agreement, and not by the Series. For these reasons, the profitability
to Neuberger Berman of its relationship with the Series or the potential
economies of scale in Neuberger Berman's management of the Series were not
material factors in the Board's deliberations at this time. For similar reasons,
the Board did not rely heavily 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. Based on all the foregoing
reasons, the Board concluded that the proposed New Subadvisory Agreement was
favorable for shareholders because shareholders could benefit from management of
the Series' assets by the equities investment team at Neuberger Berman.
After considering all the information presented, based on the qualifications of
Neuberger Berman'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 in the best interest of the Series
and their shareholders and approved the proposal.
THE 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 Commission 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
-7-
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 to the
Board.
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
Contracts issued by PLIC, PHL Variable and PLAC. 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
Neuberger Berman is a wholly-owned subsidiary of Neuberger Berman, Inc. ("NBI"),
which is a wholly-owned subsidiary of Lehman Brothers Holdings, Inc. ("LBHI").
LBHI, which trades on the New York Stock Exchange under the ticker symbol "LEH,"
through its subsidiaries (LBHI and its subsidiaries collectively "Lehman
Brothers") is one of the leading global investment banks, servicing
institutional, corporate, government and high net worth individual clients.
Lehman Brothers, which is a registered broker-dealer, futures commission
merchant and investment advisor, provides a full array of capital markets
products, investment banking services and investment management and advisory
services worldwide. Neuberger Berman and its affiliates had approximately $148
billion in assets under management as of December 31, 2007. None of the
directors or officers of Neuberger Berman 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 New Subadvisory Agreement.
The Series will be managed by members of Neuberger Berman's mid-cap team. The
team consists of portfolio managers, analysts and traders. Current members of
the team jointly and primarily responsible for the day-to-day management of the
Series are as follows:
o Kenneth Turek, CFA, is a managing director and portfolio manager on the
Growth Equity team. He joined Neuberger Berman in 2002. Previously, he
spent five years as a vice president and senior portfolio manager in
institutional asset management at Northern Trust. Additionally, Mr.
Turek was a portfolio manager at National Investment Services and Chief
Investment Officer at Cole Taylor Bank. He began his investment career
in 1985 at Northern Trust.
o Kristina Kalebich, CFA, is a managing director and product specialist
on the Growth Equity team. She joined Neuberger Berman in 2002.
Previously, she was a vice president and senior product manager at
Northern Trust. She also held various positions at JP Morgan/American
Century, Unicom and Rotary International. Ms. Kalebich began her
investment career as a broker analyst at Dean Witter Morgan Stanley.
o Chad Bruso, CFA, is an analyst on the Growth Equity team. He joined
Neuberger Berman in 2006. Previously, he spent six years at Morgan
Stanley Equity Research, working for three years as a vice president
and research analyst and three years as a research associate. Before
that, Mr. Bruso was a senior consultant at Arthur Andersen, LLP for two
years, in its transaction advisory group.
-8-
o Jeffrey P. Nevins, CFA, Associate, joined Neuberger Berman in 2007. Mr.
Nevins is a research assistant for the growth equity mutual funds.
Prior to joining the Firm, he was a senior analyst with First Analysis
Corporation and a credit analyst with LaSalle Bank.
o Sean M. Chatburn, CFA, Associate, joined Neuberger Berman in 2007. Mr.
Chatburn is a research associate with primary responsibility to assist
and research stock ideas for the growth equity mutual funds. Prior to
joining the Firm, he worked as an equity research analyst for Roxbury
Capital Management and an equity research associate for Credit Suisse
as well as William Blair & Company. He also served as a senior
associate for Moody's Investor Service and an accounting analyst for
Fidelity Investments.
Listed below are the names of officers or Directors of Neuberger Berman. None
are Trustees or officers of the Fund.
<table>
<caption>
Name Position with Subadvisor and Principal Occupation Position with Fund
---- ------------------------------------------------- ------------------
<s> <c> <c>
Peter E. Sundman President and Director None
Robert J. Conti Senior Vice President None
Brian J. Gaffney Senior Vice President None
Jack L. Rivkin Director /Chairman None
Maxine L. Gerson Senior Vice President/General None
Counsel/Secretary
Edward S. Grieb Chief Financial Officer and Treasurer None
Chamaine Williams Chief Compliance Officer None
Joseph V. Amato Director None
</table>
As of January 1, 2008, Neuberger Berman acts as an investment advisor to another
mutual fund that has a similar investment objective as the Series. The following
table provides information for the other mutual fund.
<table>
<caption>
Name of Fund Size of Fund as of 12/31/07 Fees Paid
------------ ---------------------------- ---------
<s> <c> <c>
Neuberger Berman Mid Cap Growth Fund $511 Million 0.550% of first $250 million
0.525% on next $250 million
0.500% on next $250 million
0.475% on next $250 million
0.450% on next $500 million
0.425% on next $2.5 billion
0.400% on next $4 billion(1)
</table>
(1) Includes management and administration fees for investor class shares
There are no fee waivers or expense limitations in effect with respect to the
advisory fees listed above.
PVA is wholly-owned by PM Holdings, Inc., located at One American Row, Hartford,
Connecticut 06115. PM Holdings, Inc., owns 100% of PVA's voting securities. PM
Holdings, Inc. is wholly-owned by PLIC, located at One American Row, Hartford,
Connecticut 06103. PLIC owns 100% of PM Holdings, Inc.'s voting securities. PLIC
is wholly-owned by The Phoenix Companies, Inc., located at One American Row,
Hartford, Connecticut 06103. The Phoenix Companies, Inc. owns 100% of the PLIC's
voting securities. PLIC serves as the shareholder servicing agent to the Fund,
and was paid $57,988 by the Fund during the last fiscal year for performing
those services. The Fund does not have an underwriter. Phoenix Equity Planning
Corporation ("PEPCO") serves as financial agent and administrator to the Fund.
PEPCO is located at One American Row, Hartford, Connecticut 06103. The Fund paid
PEPCO $73,306 during the last fiscal year for performing these services for the
Fund.
For the year ended December 31, 2007, the Fund paid $184,996 in brokerage
commissions. No commissions were paid to any affiliated broker of PVA or the
subadvisors.
-9-
HOUSEHOLDING OF MATERIALS
The Fund sent only one copy of this Information 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.
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 Bennett Lawrence as subadvisor to the Series without a shareholder
meeting. The Fund does not anticipate holding a meeting of shareholders in 2008.
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 in 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
February 21, 2008
-10-
EXHIBIT A
THE NEW SUBADVISORY AGREEMENT
SUBADVISORY AGREEMENT
THE PHOENIX EDGE SERIES FUND
PHOENIX MID-CAP GROWTH SERIES
Neuberger Berman Management Inc.
605 Third Avenue
New York, NY 10158
AGREEMENT made as of the 27th day of November, 2007 between Phoenix
Variable Advisors, Inc. (the "Advisor"), a corporation organized under the laws
of the State of Delaware, and Neuberger Berman Management, Inc. (the
"Subadvisor"), a corporation organized under the laws of the State of New York.
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 Mid-Cap Growth Series (the "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 Series; and
WHEREAS, pursuant to the Advisory Agreement, the Advisor renders
certain investment advisory services to the Fund on behalf of the Series,
including providing general oversight of the Series, and evaluating,
recommending and monitoring one or more registered investment advisors to serve
as subadvisor to the 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 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 subadvisor with regard to the
assets of the Series (the "Assets"), subject to the terms and
conditions set forth in this Agreement.
2. Acceptance of Employment; Standard of Performance. The Subadvisor
accepts such appointment to serve as subadvisor of the Assets and
agrees to use its best professional
-11-
judgment to make investment decisions and provide related services for
the Assets of the 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 Assets of the
Series entrusted to it under this Agreement, including the purchase,
retention, and disposition of assets, 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 Assets of the 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 Fund's Agreement and
Declaration of Trust, dated February 18, 1986, establishing the Fund,
as may be amended from time to time, ("Declaration of Trust"); (iii)
the 1940 Act, the Investment Advisers Act of 1940, as amended (the
"Advisers Act"), the Securities Act of 1933, as amended, (the "1933
Act") and the Securities Exchange Act of 1934, as amended, (the "1934
Act") and the rules and regulations thereunder; (iv) the Internal
Revenue Code of 1986, as amended, (the "Code") and the rules and
regulations thereunder, including but not limited to the requirements
for adequate diversification under Section 817(h) of the Code, for
treatment by the Series as a regulated investment company under
sub-chapter M of the Code, and for avoiding payment of any excise tax
under Section 4982 of the Code; (v) all other applicable federal and
state laws, as each may be amended from time to time; and (vi) 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 determine what portfolio investments will be
purchased, retained, or sold by the Series with regards to the Assets
of the 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
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
-12-
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 Assets of the 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 Assets of the Series at the 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 Assets of the 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 Assets of the 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 Assets of the Series will be
consummated by payment to, or delivery by, the Custodian(s) from time
to time designated by the Fund (the "Custodian"), or such depositories
or agents as may be designated by the Custodian 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 Assets of the
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 described herein. The Subadvisor shall
advise the Custodian and confirm in writing or by confirmed electronic
transmission to the Fund all investment orders for the Assets of the
Series placed by it with brokers and dealers at the time and in the
manner set forth in the Custodian Agreement and 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 other
-13-
than arrangements, acts, omissions or other conduct arising in reliance
on instructions of the Subadvisor.
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, with respect to the Assets of the Series.
In addition, the Subadvisor shall maintain such other records relating
to the services the Subadvisor provides under this Agreement as may 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, that the Fund shall be entitled to make and maintain
copies of any records so retained by request.
6. Allocation of Brokerage. The Subadvisor shall have authority and
discretion to select brokers and dealers, including any brokers and
dealers affiliated with the Subadvisor, to execute transactions
initiated by the Subadvisor on behalf of the 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 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 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 securities
for the Assets of the Series, 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 Series, 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 Series, as to which the
Subadvisor exercises investment discretion, notwithstanding that the
Series may not be the direct or exclusive beneficiary of any such
services or that another broker may be willing to charge the Series 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
-14-
knows provides investment advisory services to any of the Funds series
regarding transactions for the Fund in securities or other assets. 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
(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, so long as such acts or omissions shall not
have constituted a breach of the investment objectives, policies and
restrictions applicable to the Assets of the 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) 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
-15-
in 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 and Statement of Additional
Information, as amended or supplemented from time to time or
promotional materials pertaining or relating to the 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 for use in the Fund's registration
statement.
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) 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
or Statement of Additional Information, as amended or supplemented from
time to time relating to the 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; 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 with respect to the Assets of the
Series 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.
-16-
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.
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 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
Series. 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 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 Series. The parties acknowledge and agree that all
nonpublic personal information with regard to shareholders in the
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. 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
-17-
and to take the steps it deems necessary. 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 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 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 15 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 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 Advisor to
-18-
examine the reports required to be made by the Subadvisor under Rule
17j-l(c)(1) and all other records relevant to the Subadvisor's code of
ethics as may be reasonably requested by the Advisor or Trustees from
time to time.
(h) It will use all necessary efforts to manage the Assets of
the 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 Assets of the 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 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.
(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
substantially 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
-19-
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 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) 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 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.
-20-
(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:
(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 the Assets of the Series assets in
accordance with the then governing laws and prevailing Prospectus
pertaining to the 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 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 Assets of the Series investment program,
including, without limitation, analyses of Series performance
pertaining to the Assets of the Series;
-21-
(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 Series performance pertaining to the Assets
of the Series; (ii) disclosure related to the portfolio management of
the Assets of the 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 reasonable information that they may request in connection with the
Fund.
In addition, the Subadvisor shall immediately notify and
forward to both the Advisor and legal counsel for the 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 and Class Actions. The Subadvisor shall review all proxy
solicitation materials and be responsible for voting and handling all
proxies in relation to the Assets. Unless the Advisor or the Fund gives
the Subadvisor written instructions to the contrary, the Subadvisor
will, in compliance with the proxy voting policy and procedures adopted
by the Subadvisor, 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 Subadvisor all such 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 quarterly proxy voting reports
containing a record of votes cast containing all of the voting
information required by Form N-PX. The Subadvisor will not advise or
act on behalf of the Series to file Form N-PX as required by Rule
30b1-4 under the Act. The Subadvisor will not advise or act on behalf
of the Series in regards to class action filings, with respect to any
securities held by the Series.
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 pertaining to
the Assets of the Series for which the recordkeeping agent seeks
assistance from or identifies for review by the Advisor. The parties
agree that, consistent with applicable law, the Advisor will not bear
responsibility for the determination of value of any such securities or
other assets.
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
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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 December 31, 2008, 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 notify
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 06102
Attention: Doreen A. Bonner, Vice
President and Chief
Compliance Officer
Telephone: (860) 403-5456
Facsimile: (860) 403-5262
Email: Doreen.Bonner@phoenixwm.com
If to the Subadvisor: NEUBERGER BERMAN MANAGEMENT, INC.
605 Third Avenue
21st Floor
New York, New York 10158
Attention: Maxine Gerson, General
Counsel & Secretary
Telephone: (646) 497-4675
Facsimile: (212) 476-5781
Email: MGerson@nb.com
25. Termination. This Agreement may be terminated by any 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, upon sixty (60) days' written notice to the other party but
any such termination shall not affect the status, obligations or
liabilities of any party hereto to the other party.
26. Use of Subadvisor's Name. Subadvisor hereby grants to the Fund and
Advisor a non-exclusive, royalty-free, worldwide license to use the
subadvisor's name and logo in any and all promotional materials,
prospectuses and registration statements during the term of this
Agreement. The Fund shall furnish, or shall cause to be furnished, to
the subadvisor or its designee, each piece of sales literature or other
promotional material in which the subadvisor is named, at least ten
(10) business days prior to its use. The subadvisor shall
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be permitted to review and approve the material in written or
electronic form prior to such printing. No such material shall be used
if the subadvisor or its designee reasonably objects to such use within
ten (10) business days after receipt of this material, such approval,
may not be unreasonably withheld.
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.
29. Certifications. The Subadvisor hereby warrants and represents that it
will provide the requisite certifications requested by the Chief
Executive Officer and the Chief Financial Officer of the Fund necessary
for those named officers to fulfill their reporting and certification
obligations on Form N-SAR as required under the Sarbanes-Oxley Act of
2002.
30. 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.
31. 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
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ACCEPTED:
NEUBERGER BERMAN MANAGEMENT INC.
By: /s/ Robert Conti
----------------------------------------------------
Name: Robert Conti
Title: Managing Director
SCHEDULES: A. Operational Procedures
B. Records to be Maintained by the Subadvisor
C. Subadvisory Fee
D. Subadvisor Functions
E. Form of Sub-Certification
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SCHEDULE A
OPERATIONAL PROCEDURES
In order to minimize operational problems, it will be necessary for a
flow of information to be supplied by the Subadvisor to State Street Bank and
Trust Company (the "Custodian") and PFPC, Inc. (the "Sub-Accounting Agent") for
the Fund.
The Subadvisor must furnish the Custodian 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 5:00 p.m. (Eastern time) on the day of the
trade (confirmation received from broker). The necessary information can be sent
electronically or via facsimile machine to the Custodian and the Sub-Accounting
Agent. Information provided to the Custodian and the Sub-Accounting Agent shall
include the following:
1. Purchase or sale;
2. Security name;
3. Security identifier (e.g., CUSIP), if applicable;
4. Number of shares and sales price per share;
5. Executing broker;
6. Settlement instructions for foreign trades; clearing and
executing broker for domestic trades;
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 Series,
the account must be a cash account. No margin accounts are to be maintained in
the name of the Series. Delivery instructions are as specified by the Custodian.
The Custodian and Sub-Accounting Agent will supply the Subadvisor daily with a
cash availability report via access to the Custodian website, or by email or by
facsimile and the Sub-Accounting Agent will provide a five day cash projection
report, which shall include cash detail and pending trades. This will normally
be done by electronically or via facsimile machine by confirmed facsimile or
confirmed electronic transmission so that the Subadvisor will know the amount
available for investment purposes.
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SCHEDULE B
RECORDS TO BE MAINTAINED BY THE SUBADVISOR
1. (Rule 31a-1(b)(5)) A record of each brokerage order, and all other series
purchases and sales, given by the Subadvisor on behalf of the 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
cancellations thereof;
C. The time of entry or cancellation;
D. The price at which executed;
E. The time of receipt of a report of execution; and
F. The name of the person who placed the order on behalf of the Fund.
2. (Rule 31a-1(b)(9)) A record for each fiscal quarter, completed within ten
(10) days after the end of the quarter, showing specifically the basis or
bases upon which the allocation of orders for the purchase and sale of
Series securities placed by the Subadvisor 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. The name of the person responsible for making the determination of
such allocation and such division of brokerage commissions or
other compensation.
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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 series 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 part of this
record: any memorandum, recommendation or instruction supporting or
authorizing the purchase or sale of series securities and such other
information as is appropriate to support the authorization.*
4. (Rule 31a-1(f)) Such accounts, books and other documents as are required
to be maintained by registered investment advisers by rule adopted under
Section 204 of the Investment Advisers Act of 1940, to the extent such
records are necessary or appropriate to record the Subadvisor's
transactions for the 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.
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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 Series shall be valued
as set forth in the then current registration statement of the Fund.
NAME OF SERIES: ANNUAL SUBADVISORY FEE RATE
Phoenix Mid-Cap Growth Series 0.425% on the first $500 million of
average net assets
0.40% on average net assets in
excess of $500 million
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SCHEDULE D
SUBADVISOR FUNCTIONS
With respect to managing the investment and reinvestment of the Series'
assets, the Subadvisor shall provide, at its own expense:
(a) An investment program for the Series consistent with its investment
objectives based upon the development, review and adjustment of buy/sell
strategies approved from time to time by the Board of Trustees and
Advisor, all as set forth in the Objectives and Policies;
(b) Implementation of the investment program for the 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 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
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 Series' investment program, including, without
limitation, analysis of 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.
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SCHEDULE E
FORM OF SUB-CERTIFICATION
To:
Re: Form N-CSR Certification for the [Name of Series].
From: [Name of Subadvisor]
Representations in support of Investment Company Act Rule 30b1-5 certifications
of Form N-CSR.
[Name of Series].
In connection with your certification responsibility under Rule 30b1-5
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") which forms part of the N-CSR for
the Series.
Schedule of Investments (the "Reports")
Our organization has designed, implemented and maintained internal controls and
procedures, designed for the purpose of ensuring the accuracy and completeness
of relevant portfolio trade data transmitted to those responsible for the
preparation of the Schedule of Investments. As of the date of this certification
there have been no material modifications to these internal controls and
procedures.
In addition, our organization has:
a. Designed such internal controls and procedures to ensure that material
information is made known to the appropriate groups responsible for
servicing the above-mentioned mutual funds.
b. In addition, to the best of my knowledge 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.
I have read the draft of the Reports which I understand to be current as of
[Date of Reporting Period] and based on my knowledge, such drafts of the Reports
do not, with respect to the Series, contain any untrue statement of a material
fact or omit to state a material fact necessary to make the information
contained therein, in light of the circumstances under which such information is
presented, not misleading with respect to the period covered by such draft
Reports. I have disclosed, based on my most recent evaluation, to the Series'
Chief Accounting Officer:
a. All significant changes, deficiencies and material weakness, if any, in
the design or operation of the Subadvisor's internal controls and
procedures which could adversely affect the Advisor's ability to
record, process, summarize and report financial data in a timely
fashion;
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b. Any fraud, whether or not material, that involves the Subadvisor's
management or other employees who have significant role in the
Subadvisor's internal controls and procedures for financial reporting.
I certify that to the best of my knowledge:
a. The Subadvisor's portfolio manager has 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 Series and the Policies and Procedures
of the Series as adopted by the Board of Trustees.
c. I have no knowledge of any compliance violations with respect to the
Series except as disclosed in writing to the Phoenix Compliance
Department by me or by the Subadvisor's compliance officer.
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 Series as outlined above.
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 as the Funds'
official accounting system. The Subadvisor is not responsible for the
preparation of the Reports.
- ------------------------------- --------------------------
[Name of Authorized Signature] Date
(W0172657.2)
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