SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e) (2)
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or
ss. 240.14a-12
PHOENIX-EUCLID FUNDS
--------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
Pamela S. Sinofsky
c/o Phoenix Investment Partners, Ltd.
56 Prospect Street
Hartford, Connecticut 06115-0480
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
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 Act Rule
0-11 (Set forth the amount on which the filing fee is
calculated and state 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 offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form
or and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration No.:
3) Filing Party:
4) Date Filed:
<PAGE>
PHOENIX-EUCLID MARKET NEUTRAL FUND
A SERIES OF
PHOENIX-EUCLID FUNDS
----------------------------
900 THIRD AVENUE
31ST FLOOR
NEW YORK, NEW YORK 10022
1 (800) 243-1574
----------------------------
August 24, 2000
Dear Shareholder:
We are pleased to enclose the proxy statement for the October 12, 2000
special shareholders meeting of your Fund. Please take the time to read the
proxy statement and cast your vote, because the changes are important to you as
a shareholder.
We are asking shareholders to approve changing to the Fund's fundamental
investment restrictions to make them similar to our other Phoenix Funds. We do
not presently anticipate that these changes will have any material impact on the
investment techniques employed by the Fund. We are also asking shareholders to
ratify the selection of PricewaterhouseCoopers as the Fund's independent public
accountants.
The Board of Trustees believes that the proposed changes to the fundamental
investment restrictions and the approval of PricewaterhouseCoopers are in the
best interests of the shareholders. The Board of Trustees has unanimously
recommended that shareholders approve the proposals described in the proxy
statement and proxy. Should you have any questions, please feel free to call us
at 1(800) 243-1574. We will be happy to answer any questions you may have.
I URGE EACH SHAREHOLDER TO PROMPTLY MARK, SIGN AND RETURN THE ENCLOSED
PROXY.
Sincerely,
Martin E. Zweig
President
<PAGE>
PHOENIX-EUCLID MARKET NEUTRAL FUND
A SERIES OF
PHOENIX-EUCLID FUNDS
900 THIRD AVENUE
31ST FLOOR
NEW YORK, NEW YORK 10022
1 (800) 243-1574
------------------------
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 12, 2000
------------------------
To The Shareholders:
Phoenix-Euclid Funds, a Delaware business trust (the "Trust"), will hold a
special meeting of shareholders of Phoenix-Euclid Market Neutral Fund (the
"Fund") at the offices of Phoenix Equity Planning Corporation, 101 Munson
Street, Greenfield, Massachusetts 01301 on October 12, 2000 at 2:00 p.m., local
time, for the following purposes:
1. To amend the fundamental investment restriction of the Fund regarding
concentration.
2. To amend the fundamental investment restriction of the Fund regarding
diversification.
3. To amend the fundamental investment restriction of the Fund regarding
investing in real estate.
4. To amend the fundamental investment restriction of the Fund regarding
lending.
5. To amend the fundamental investment restriction of the Fund regarding
the issuance of senior securities.
6. To amend the fundamental investment restriction of the Fund regarding
underwriting.
7. To amend the fundamental investment restriction of the Fund regarding
investing in commodities.
8. To amend the fundamental investment restriction of the Fund regarding
borrowing.
9. To ratify or reject the selection of PricewaterhouseCoopers LLP,
independent accountants, to audit financial statements of the Fund.
10. To consider and act upon any other business as may properly come
before the meeting and any adjournments thereof.
You are entitled to vote at the meeting and any adjournment(s) thereof if
you owned shares of the Fund at the close of business on August 14, 2000.
Whether or not you plan to attend the meeting in person, please vote your
shares. As a convenience to our shareholders, you may now vote in any one of the
following ways:
o By telephone, with a toll-free call to the number listed on the
enclosed proxy card and following the recorded instructions;
o By mail, with the enclosed proxy card and postage-paid envelope; or
o In person at the meeting.
We encourage you to vote by telephone, using the control number that
appears on your enclosed proxy card. Use of telephone voting will reduce the
time and costs associated with this proxy solicitation. Whichever method you
choose, please read the enclosed proxy statement carefully before you vote.
PLEASE RESPOND - WE ASK THAT YOU VOTE PROMPTLY IN ORDER TO
AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION. YOUR
VOTE IS IMPORTANT.
By Order of the Board of Trustees
of Phoenix-Euclid Funds,
MARC BALTUCH
Secretary
<PAGE>
PHOENIX-EUCLID MARKET NEUTRAL FUND
A SERIES OF
PHOENIX-EUCLID FUNDS
900 THIRD AVENUE
31ST FLOOR
NEW YORK, NEW YORK 10022
1 (800) 243-1574
------------------------
PROXY STATEMENT
------------------------
MEETING OF SHAREHOLDERS
This proxy statement is being furnished in connection with the solicitation
by the Board of Trustees of Phoenix-Euclid Funds (the "Trust") of proxies to be
used at a meeting of the shareholders of Phoenix-Euclid Market Neutral Fund (the
"Fund"), and at any adjournment(s) thereof. The meeting will be held at the
offices of Phoenix Equity Planning Corporation, 101 Munson Street, Greenfield,
Massachusetts 02301 on October 12, 2000 at 2:00 p.m., local time.
The purpose of the meeting is to consider changes to the fundamental
investment restrictions of the Fund and to ratify the selection of
PricewaterhouseCoopers as the independent public accountants of the Fund.
Although the proposed fundamental investment restriction changes would allow the
Fund to change its investment practices, for instance, through the increased
ability to borrow money to make additional investments (See Proposal 8), there
is no current intention to change the Fund's investment objective or principal
investment strategy.
This Proxy Statement and the enclosed form of proxy are first being mailed
to shareholders on or about August 24, 2000.
VOTING INFORMATION
Shareholders of record of the Fund at the close of business on August 14,
2000 will be entitled to vote at the meeting or at any adjournments thereof. The
following table shows as of the record date, the number of shares of the Fund
and the votes represented by such shares as of the record date:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
SHARES
CLASS OUTSTANDING VOTES
--------------------------------------------------------------------------------
<S> <C> <C>
Class A Shares 807,279.489 $7,951,702.96
--------------------------------------------------------------------------------
Class B Shares 1,437,106.079 $14,083.639.57
--------------------------------------------------------------------------------
Class C Shares 970,518.110 $9,491,667.11
--------------------------------------------------------------------------------
Class I Shares 1,355,769.343 $13,272,981.86
--------------------------------------------------------------------------------
</TABLE>
Shareholders are entitled to one vote for each dollar of net asset value
(determined as of the record date) of each share owned by such shareholder on
any matter on which such shareholder is entitled to vote and each fractional
dollar amount shall be entitled to a proportionate fractional vote. Shareholders
of the Fund will vote separately on each proposal, with all classes of the Fund
voting together. The holders of thirty-three and one-third percent of the
outstanding shares of the Fund entitled to vote shall constitute a quorum for
the meeting. A quorum being present, the approval of each proposal by the Fund
requires the vote of the lesser of (i) 67% or more of the eligible votes of the
Fund present at the meeting if more than 50% of the eligible votes of the Fund
are present in person or by proxy or (ii) more than 50% of the eligible votes of
the Fund. For purposes of this proxy statement, the Investment Company Act of
1940, as amended (the "1940 Act") includes rules and regulations of the SEC
issued under that Act.
For purposes of determining the presence of a quorum for transacting
business at the meeting and for determining whether sufficient votes have been
received for approval of the proposals to be acted upon at the meeting,
abstentions and broker "non-votes" (that is, proxies from brokers or nominees
indicating that such persons have not received instructions
<PAGE>
from the beneficial owner or other persons entitled to vote shares on a
particular matter with respect to which the brokers or nominees do not have
discretionary power) will be treated as shares that are present at the meeting,
but which have not been voted. For this reason, abstentions and broker non-votes
will assist each Fund in obtaining a quorum, but both have the practical effect
of a "no" vote for purposes of obtaining the requisite vote for approval of the
proposals.
If either (a) a quorum is not present at the meeting or (b) a quorum is
present but sufficient votes in favor of one or more of the proposals have not
been obtained, then the persons named as proxies may propose one or more
adjournments of the meeting without further notice to shareholders to permit
further solicitation of proxies provided such persons determine, after
consideration of all relevant factors, including the nature of the proposals,
the percentage of votes then cast, the percentage of negative votes then cast,
the nature of the proposed solicitation activities and the nature of the reasons
for such further solicitation, that an adjournment and additional solicitation
is reasonable and in the interests of shareholders. When voting for a proposed
adjournment, the persons named as proxies will vote for the proposed adjournment
all shares that they are entitled to vote with respect to each proposal, unless
directed to vote against the proposal, in which case such shares will be voted
against the proposed adjournment with respect to that proposal.
The meeting may be adjourned from time to time by the vote of a majority of
the shares represented at the meeting, whether or not a quorum is present. If
the meeting is adjourned to another time or place, notice need not be given of
the adjourned meeting at which the adjournment is taken, unless a new record
date of the adjourned meeting is fixed or unless the adjournment is for more
than sixty (60) days from the date set for the original meeting, in which case
the Trustees shall set a new record date. At any adjourned meeting, the Trust
may transact any business which might have been transacted at the original
meeting.
The individuals named as proxies on the enclosed proxy card will vote in
accordance with the shareholder's direction, as indicated thereon, if the proxy
card is received and is properly executed. If the shareholder properly executes
a proxy and gives no voting instructions with respect to any one or more of the
proposals, the shares will be voted in favor of each of the proposals for which
instructions were not given. The proxies, in their discretion, may vote upon
such other matters as may properly come before the meeting. The Board of
Trustees of the Trust is not aware of any other matters to come before the
meeting.
REVOCATION OF PROXIES
Any shareholder who has given a proxy has the right to revoke the proxy any
time prior to its exercise
o by written notice of the proxy's revocation to the Secretary of the
Trust at the above address prior to the meeting;
o by the subsequent execution and return of another proxy prior to the
meeting;
o by submitting a subsequent telephone vote; or
o by being present and voting in person at the meeting and giving oral
notice of revocation to the Chairman of the meeting.
SOLICITATION OF PROXIES
In addition to the solicitation of proxies by mail, officers and employees
of Phoenix Investment Partners, Ltd. or its affiliates, may solicit proxies
personally or by telephone or telegram. The Trust intends to use one or more
outside proxy solicitation firms to assist with the mailing and tabulation
effort and any special personal solicitation of proxies. Banks, brokers,
fiduciaries and nominees will, upon request, be reimbursed by the Funds for
their reasonable expenses in sending proxy material to beneficial owners of
shares of the Funds. The cost of the solicitation of proxies will be borne by
Phoenix Investment Partners, Ltd. D.F. King and Co., Inc., a proxy solicitation
firm, has been engaged by the Trust to act as solicitor and will receive fees
estimated at 5,000.00, plus reimbursement of out-of-pocket expenses.
If a shareholder wishes to participate in the meeting, but does not wish to
authorize the execution of a proxy by telephone, the shareholder may still
submit the proxy form included with this proxy statement or attend the meeting
in person.
2
<PAGE>
SHARES OWNED BY CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of July 25, 2000 with
respect to each person who beneficially owns 5% or more of any class of a Fund's
equity securities.
<TABLE>
<CAPTION>
NAME OF SHAREHOLDER CLASS PERCENTAGE OF CLASS NUMBER OF SHARES
------------------- ------------------- ----------------------- ----------------
<S> <C> <C> <C>
MLPF&S Class A 7.06% 57,414.062
For the Sole Benefit of its Customers
Attn: Fund Administration 977T2
4800 Deer Lake Drive East, FL 2
Jacksonville, FL 32246-6484
Charles Schwab & Co., Inc. Class A 9.10% 74,043.725
Special Custody Acct for the
Benefit of Customers
101 Montgomery Street
San Francisco, CA 94104-4122
MLPF&S Class B 23.62% 361,261.434
For the Sole Benefit of its Customer Class C 10.90% 108,338.909
Attn: Fund Administration 975Y4
4800 Deer Lake Drive East, FL 2
Jacksonville, FL 32246-6484
Union Bank Trust Nominee Class C 17.95% 178,434.833
FBO OLT Pension - #30168611
P.O. Box 85484
San Diego, CA 92186-5484
Martin E. Zweig & Jeffrey Perry TTEE Class I 5.60% 77,153.569
Zweig-Dimenna Associates Inc.
Retirement Trust MPP DTD 01/01/99
Attn: Michael Link
900 3rd Avenue, FL 31
New York, NY 10022-4728
Martin E. Zweig Class I 13.06% 179,866.471
C/O Zweig Companies
900 3rd Avenue
New York, NY 10022-4728
The Loomis Institute Class I 20.84% 287,104.176
Christopher Wejchert CFO
4 Batchelder Road
Windsor, CT 06095-3031
Mollie F. Zweig Class I 45.68% 629,178.801
625 Park Avenue
New York, NY 10021-6545
Raymond Larsen Class I 11.00% 151,573.379
7914 Fisher Island Drive
Fisher Island, FL 33109-0993
</TABLE>
As of July 25, 2000, the Trustees and officers as a group owned 13% of
the Class I Shares of the Fund and less than 1% of any other class of the Fund.
3
<PAGE>
A COPY OF THE TRUST'S MOST RECENT ANNUAL AND SEMIANNUAL REPORTS WILL BE
FURNISHED, WITHOUT CHARGE, TO ANY SHAREHOLDER UPON REQUEST TO PHOENIX EQUITY
PLANNING CORPORATION, 100 BRIGHT MEADOW BOULEVARD, P.O. BOX 2200, ENFIELD,
CONNECTICUT 06083-2200. SHAREHOLDERS MAY ALSO CALL PHOENIX EQUITY PLANNING
CORPORATION TOLL-FREE AT (800) 243-4361.
REASONS FOR THE PROPOSED CHANGES IN FUNDAMENTAL INVESTMENT RESTRICTIONS
(PROPOSALS 1-8)
Proposals 1-8 contained in this proxy statement are among a series of
proposed transactions in which mutual funds managed by Phoenix Investment
Counsel, Inc. ("Phoenix") and its affiliates (the "Phoenix Funds") will, if not
previously organized as Delaware business trusts, be reorganized as a Delaware
business trust and then operate under common fundamental investment
restrictions. Since the Trust already is a Delaware business trust, the changes
contemplated by this proxy statement are limited to changes in the fundamental
investment restrictions of the Funds. Because many of the Phoenix Funds began
operations outside of the Phoenix organization, they have different fundamental
investment restrictions. Phoenix believes that integrating all of the Phoenix
Funds by adopting a single business form and domicile and standardized
fundamental investment restrictions offers the opportunity for operational
efficiencies that will benefit all shareholders.
The proposed investment restrictions are expected to become generally
standard for all of the Phoenix Funds. These proposed restrictions differ in
certain respects from the existing fundamental investment restrictions as
described in the proposals below. Phoenix believes that increased
standardization of fundamental investment restrictions will help to promote
operational efficiencies and facilitate monitoring of compliance with the
restrictions. Phoenix does not presently anticipate that the use of different
investment restrictions will have any material impact on the investment
techniques employed by the Fund.
PROPOSAL 1
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING CONCENTRATION
The Board of Trustees has proposed that the shareholders approve an
amendment to the fundamental investment restriction regarding industry
concentration. The current fundamental investment restriction regarding industry
concentration applicable to the Fund, provides that the Fund may not:
"Purchase the securities of issuers conducting their principal
business activities in the same industry if immediately after such
purchase the value of the Fund's investments in such industry would be
25% or more of the value of its total assets (there is no such
limitation with respect to obligations of the U.S. Government, its
agencies or instrumentality's or with respect to investments in other
investment companies complying with such policy)."
If Proposal 1 is approved, this restriction will be replaced with the
following fundamental investment restriction regarding industry concentration
for the Fund:
"A Fund may not purchase securities if, after giving effect to the
purchase, more than 25% of its total assets would be invested in the
securities of one or more issuers conducting their principal business
activities in the same industry (excluding the U.S. Government, its
agencies or instrumentalities)."
Phoenix believes that there is no substantive change involved in this
proposal. Phoenix does not believe that the reference to the ability to invest
in other investment companies is relevant to a concentration policy. The ability
of the Fund to invest in other investment companies is subject to limitations
under the 1940 Act.
4
<PAGE>
PROPOSAL 2
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING DIVERSIFICATION
The Board of Trustees has proposed that the shareholders approve an
amendment to the fundamental investment restriction regarding diversification.
The current fundamental investment restriction regarding diversification
applicable to the Fund, provides that the Fund may not:
"With respect to 75% of the Fund's assets, purchase the securities of
any one issuer if immediately after such purchase (i) more than 5% of
the value of the Fund's total assets would be invested in such issuer
or (ii) the Fund would own more than 10% of the outstanding voting
securities of such issuer. (Such limitations do not apply to
securities issued by the U.S. Government, its agencies or
instrumentality's or with respect to investments in other investment
companies complying with such policy)."
If Proposal 2 is approved, this restriction will be replaced with the
following fundamental investment restriction regarding diversification:
"A Fund may not, with respect to 75% of its total assets, purchase
securities of an issuer (other than the U.S. Government, its agencies,
instrumentalities or authorities or repurchase agreements
collateralized by U.S. Government securities and other investment
companies), if: (a) such purchase would, at the time, cause more than
5% of the Fund's total assets taken at market value to be invested in
the securities of such issuer; or (b) such purchase would at the time
result in more than 10% of the outstanding voting securities of such
issuer being held by the Fund."
The proposed restriction does not apply to any investments by the Fund in
other investment companies, regardless of whether the other investment companies
are diversified or nondiversified. For example, the 1940 Act generally limits
the Fund's investment in all other unaffiliated investment companies, all or
some of which may be nondiversified, to ten percent of the Fund's total assets.
Phoenix does not presently anticipate that the change in this restriction will
have a material impact on the investment techniques employed by the Fund.
PROPOSAL 3
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING INVESTING IN REAL ESTATE
The Board of Trustees has proposed that the shareholders of the Fund
approve an amendment to the fundamental investment restriction regarding
investing in real estate. The current fundamental investment restriction
regarding investing in real estate states that the Fund may not:
"Invest in real estate, provided that this limitation shall not
prohibit the purchase of securities issued by companies that invest in
real estate or interests therein, including real estate investment
trusts."
If Proposal 3 is approved, this restriction will be replaced with the
following fundamental investment restriction:
"A Fund may not purchase or sell real estate, except that the Fund may
(i) acquire or lease office space for its own use, (ii) invest in
securities of issuers that invest in real estate or interests therein,
(iii) invest in mortgage-related securities and other securities that
are secured by real estate or interests therein, (iv) hold and sell
real estate acquired by the Fund as a result of the ownership of
securities."
The proposed restriction would clarify that the Fund is permitted to
acquire or lease office space for its own use, although it is not anticipated
that the Fund will do so. The proposed restriction would also permit a Fund to
hold and sell real estate acquired as a result of the ownership of securities
(for example as the holder of a bond in a company that had gone into
bankruptcy).
5
<PAGE>
PROPOSAL 4
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING LENDING
The Board of Trustees has proposed that the shareholders of the Fund
approve an amendment to the fundamental investment restriction regarding
lending. The current fundamental investment restriction regarding lending states
that the Fund may not:
"Make loans, except that this restriction shall not prohibit the
purchase and holding of a portion of an issue of publicly distributed
debt securities, the lending of portfolio securities (if the aggregate
value of the loaned securities does not at any time exceed one-third
of the total assets of the Fund), or the entry into repurchase
agreements."
If Proposal 4 is approved, this restriction will be replaced with the
following fundamental investment restriction:
"A Fund may not make loans, except that the Fund may (i) lend
portfolio securities, (ii) enter into repurchase agreements, (iii)
purchase all or a portion of an issue of debt securities, bank loan
participation interests, bank certificates of deposit, bankers'
acceptances, debentures or other securities, whether or not the
purchase is made upon the original issuance of the securities and (iv)
participate in an interfund lending program with other registered
investment companies."
Under the current restriction on lending, the Fund is permitted to lend its
portfolio securities up to one-third of its total assets. The proposed lending
restriction applicable to the Fund does not contain any percentage limitation.
The staff of the SEC currently limits loans of portfolio securities to one-third
of a mutual fund's assets, including any collateral received from the loan. If
the SEC staff were to provide greater flexibility to mutual funds to engage in
securities lending in the future, the Fund would be able to take advantage of
that increased flexibility. To the extent the Fund lends a greater percentage of
its assets, the risks to the Fund associated with lending, such as defaults by
borrowers, may also increase. The lending restriction applicable to the Fund
would also permit the Fund to participate in an interfund lending program with
other registered investment companies. The current restriction does not allow
for interfund lending. Phoenix does not currently intend to establish an
interfund lending program.
PROPOSAL 5
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING THE ISSUANCE OF SENIOR SECURITIES
The Board of Trustees has proposed that the shareholders of the Fund
approve an amendment to the fundamental investment restriction regarding the
issuance of senior securities. The current fundamental investment restriction
regarding senior securities provides that the Fund may not:
"Issue "senior securities," except as permitted under the Investment
Company Act of 1940."
If Proposal 5 is approved, this restriction will be replaced with the
following fundamental investment restriction:
"A Fund may not issue "senior securities" in contravention of the 1940
Act. Activities permitted by SEC exemptive orders or staff
interpretations shall not be deemed to be prohibited by this
restriction."
The SEC through rulemaking and exemptive orders and the SEC staff through
interpretations have previously permitted mutual funds to engage in certain
practices and trading activities, subject to certain limitations, that could
otherwise be viewed as senior securities, including the issuance of multiple
classes of shares, futures and options transactions. The new restriction
applicable to the Fund provides that the Fund will be allowed to engage in these
activities to the extent permitted by the SEC or the SEC staff. Since the Fund
will have greater flexibility to issue senior securities, the Fund may be
subject to additional costs and risks. For example, the costs of engaging in
trading activities which could be viewed as senior securities can reduce a
fund's total return. In addition, upon engaging in activities which could be
viewed as senior securities, the Fund could experience increased risks due to
the effects of leveraging.
6
<PAGE>
PROPOSAL 6
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION REGARDING UNDERWRITING
The Board of Trustees has proposed that the shareholders of the Fund
approve an amendment to the fundamental investment restriction regarding
underwriting. The current fundamental investment restriction regarding
underwriting states that the Fund may not:
"Act as an underwriter, except that the Fund technically may be deemed
to be an underwriter in a registration under the Securities Act of
1933 to resell restricted securities."
If Proposal 6 is approved, this restriction will be replaced with the
following fundamental investment restriction:
"A Fund may not underwrite the securities issued by other persons,
except to the extent that, in connection with the disposition of
portfolio securities, the Fund may be deemed to be an underwriter
under applicable law."
Phoenix believes there is no substantive change involved in this proposal.
The proposed investment restriction clarifies that a Fund would not violate the
restriction if it was deemed an underwriter as a result of the sale of its
portfolio securities under the Securities Act of 1933, as amended, or any other
applicable law.
PROPOSAL 7
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING INVESTING IN COMMODITIES
The Board of Trustees has proposed that the shareholders of the Fund
approve an amendment to the fundamental investment restriction regarding
commodities. The current fundamental investment restriction regarding
commodities provides that the Fund may not:
"Invest in physical commodities or commodity contracts: provided that
this limitation shall not prevent the Fund from purchasing and selling
futures contracts and options."
If Proposal 7 is approved, this restriction will be replaced with the
following fundamental investment restriction:
"A Fund may not purchase or sell commodities or commodity contracts,
except the Fund may purchase and sell derivatives (including, but not
limited to, options, futures contracts and options on futures
contracts) whose value is tied to the value of a financial index or a
financial instrument or other asset (including, but not limited to,
securities indexes, interest rates, securities currencies and physical
commodities)."
The proposed restriction offers the Fund greater flexibility in that it
permits investments generally in financial derivatives as opposed to a specific
listing of permitted types of derivative investments. The proposed restriction
permits the Fund to purchase and sell derivatives that have a value tied to the
value of a financial index, financial instrument or other asset. These
derivatives include, for example, options, futures contracts and options on
futures contracts. While the use of derivatives can guard against potential
risks, it can eliminate some opportunities for gain. The main risk with
derivatives is that some types of derivatives can amplify a gain or loss,
potentially earning or losing substantially more money that the actual cost of
the derivative. With some derivatives, whether used for hedging or speculation,
there is also the risk that the counterparty may fail to honor its contract
terms, causing a loss for the Fund. The Fund's ability to engage in futures
contracts and options on futures is subject to applicable rules of the Commodity
Futures Trading Commission ("CFTC"). Under current CFTC rules, the Fund would
not be permitted to enter into a futures transactions if it would cause the
aggregate amount of initial margin deposit and related option premiums for
non-hedging purposes to exceed 5% of the value of its assets. The losses to the
Fund resulting from entering into future transactions could exceed the amount of
the initial margin deposit and related option premiums.
7
<PAGE>
PROPOSAL 8
TO AMEND THE FUNDAMENTAL INVESTMENT RESTRICTION REGARDING BORROWING
The Board of Trustees has proposed that the shareholders of the Fund
approve a new fundamental investment restriction regarding borrowing. The
current fundamental investment restriction regarding borrowing states that the
Fund may not:
"Borrow money in excess of 20% of its total assets taken at cost or at
market value, whichever is lower, and then only from banks as a
temporary measure for extraordinary or emergency purposes. If such
borrowings exceed 5% of the Fund's total assets, the Fund will make no
further investments until such borrowing is repaid. (Short sales and
related borrowings of securities are not subject to these
restrictions.)"
If Proposal 8 is approved, this restriction will be replaced with the
following fundamental investment restriction regarding borrowing:
"A Fund may not borrow money, except (i) in amounts not to exceed
one-third of the value of the Fund's total assets (including the
amount borrowed) from banks, and (ii) up to an additional 5% of its
total assets from banks or other lenders for temporary purposes. For
purposes of this restriction, (a) investment techniques such as margin
purchases, short sales, forward commitments, and roll transactions,
(b) investments in instruments such as futures contracts, swaps, and
options and (c) short-term credits extended in connection with trade
clearance and settlement, shall not constitute borrowing."
The current restriction prohibits the Fund from making further investments
during any time when borrowings exceed 5% of the Fund's assets. If the proposal
is adopted, the Fund will have greater flexibility to leverage the Fund's assets
in that the Fund will be able to borrow for any purpose up to one-third of its
total assets (including the amount borrowed) from banks, plus an additional 5%
of its total assets from banks or other lenders for temporary purposes. Any
borrowing would exaggerate the effect on the Fund's net asset value resulting
from any increase or decrease in the market price of securities in the Fund's
portfolio and, therefore, may increase the volatility and risk of the Fund.
Money borrowed will be subject to interest and other costs. These costs may
exceed the gain on securities purchased with borrowed funds. The proposed
restriction is consistent with the limitations currently imposed on borrowing by
mutual funds under the 1940 Act.
PROPOSAL 9
TO RATIFY OR REJECT THE SELECTION OF AUDITORS
On the recommendation of the Audit Committee, the Trustees (including all
of the Trustees who are not interested persons of the Fund) have selected
PricewaterhouseCoopers LLP, independent accountants, to audit financial
statements of the Fund filed with the Securities and Exchange Commission and
other regulatory authorities. The Fund has been advised that neither such firm
nor any of its partners has any financial interest in the Fund. The selection of
auditors is subject to ratification or rejection by the shareholders at the
meeting.
A representative of PricewaterhouseCoopers LLP, auditors for the Fund for
the fiscal year ended December 31, 1999, is not expected to be present at the
meeting.
The Fund's auditors examine the financial statements of the Fund annually,
issue a report on internal controls and procedures for inclusion in Securities
and Exchange Commission filings for the year, review the Fund's semi-annual
financial statements and prepare or review the Fund's income tax returns.
THE BOARD OF TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND
THAT THE SHAREHOLDERS APPROVE EACH OF THE PROPOSALS.
8
<PAGE>
ADVISER, PRINCIPAL UNDERWRITER AND ADMINISTRATOR
Euclid Advisors LLC, 900 Third Avenue, New York, New York 10022 is the
investment adviser to the Fund. Phoenix Equity Planning Corporation, 100 Bright
Meadow Boulevard, P.O. Box 2200, Enfield, Connecticut 06083-2000, serves as the
Trust's underwriter and as the Trust's financial agent (administrator).
OTHER BUSINESS
The Board of Trustees of the Trust knows of no business to be brought
before the meeting other than the matters set forth in this Proxy Statement.
Should any other matter requiring a vote of the shareholders of the Fund arise,
however, the proxies will vote thereon according to their best judgment in the
interests of the Fund and the shareholders of the Fund.
The Fund does not hold annual meetings of shareholders. There will normally
be no meeting of shareholders for the purpose of electing Trustees of the Trust
unless and until such time as less than a majority of the Trustees holding
office have been elected by the shareholders, at which time the Trustees then in
office will call a shareholders' meeting for the election of Trustees.
Shareholders wishing to submit proposals for inclusion in the proxy statement
for any subsequent shareholder meeting of the Fund should send their written
submissions to the principal executive offices of the Fund at 101 Munson Street,
Greenfield, Massachusetts 01301.
9
<PAGE>
PHOENIX-EUCLID FUNDS
900 THIRD AVENUE
31ST FLOOR
NEW YORK, NEW YORK 10022
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS
OCTOBER 12, 2000
PHOENIX-EUCLID MARKET NEUTRAL FUND
PROXY
The undersigned shareholder of Phoenix-Euclid Market Neutral Fund (the
"Fund"), a series of Phoenix-Euclid Funds (the "Trust"), revoking any and all
previous proxies heretofore given for shares of the Fund held by the
undersigned, hereby constitutes Martin E. Zweig and Pamela S. Sinofsky, and each
of them, proxies and attorneys of the undersigned, with power of substitution to
each, for and in the name of the undersigned to vote and act upon all matters
(unless and except as expressly limited below) at the Special Meeting of
Shareholders of the Fund to be held on October 12, 2000 at the offices of
Phoenix Equity Planning Corporation, 101 Munson Street, Greenfield,
Massachusetts, and at any and all adjournments thereof, with respect to all
shares of the Fund for which the undersigned is entitled to provide instructions
or with respect to which the undersigned would be entitled to provide
instructions or act with all the powers the undersigned would possess if
personally present and to vote with respect to specific matters as set forth
below. Any proxies heretofore given by the undersigned with respect to said
meeting are hereby revised.
To avoid the expense of adjourning the Meeting to a subsequent date, please
return this proxy in the enclosed self-addressed, postage-paid envelope. In the
alternative, you may vote by telephone by calling toll-free 1-877-779-8683 and
following the recorded instructions. Prompt voting by shareholders will avoid
the costs associated with further solicitation.
This proxy, if properly executed, will be voted in the manner as directed
herein by the undersigned shareholder. Unless otherwise specified in the squares
provided, the undersigned's vote will be cast "FOR" each Proposal. If no
direction is made for any Proposals, this proxy will be voted "FOR" any and all
such Proposals.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
TRUSTEES OF THE TRUST WHICH RECOMMENDS A VOTE
"FOR" EACH OF THE PROPOSALS
<PAGE>
ACCOUNT NUMBER:
SHARES:
CONTROL NO.:
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: [X]
KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
VOTE ON PROPOSALS FOR PHOENIX-EUCLID MARKET NEUTRAL FUND
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
1. To amend the fundamental investment For Against Abstain
restriction regarding concentration. [ ] [ ] [ ]
2. To amend the fundamental investment For Against Abstain
restriction regarding diversification. [ ] [ ] [ ]
3. To amend the fundamental restriction For Against Abstain
regarding investing in real estate. [ ] [ ] [ ]
4. To amend the fundamental investment For Against Abstain
restriction regarding lending [ ] [ ] [ ]
5. To amend the fundamental investment For Against Abstain
restriction regarding the issuance of senior [ ] [ ] [ ]
securities.
6. To amend the fundamental investment For Against Abstain
restriction regarding underwriting [ ] [ ] [ ]
7. To amend the fundamental investment For Against Abstain
restriction regarding investing in [ ] [ ] [ ]
commodities.
8. To amend the fundamental investment For Against Abstain
restriction regarding borrowing. [ ] [ ] [ ]
9. To ratify the selection of For Against Abstain
PricewaterhouseCoopers LLP as auditors. [ ] [ ] [ ]
</TABLE>
TO TRANSACT SUCH OTHER BUSINESS AS PROPERLY MAY COME BEFORE THE MEETING
OR ANY ADJOURNMENT THEREOF.
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME APPEARS HEREON. IF SHARES ARE
REGISTERED IN MORE THAN ONE NAME, ALL REGISTERED SHAREHOLDERS SHOULD SIGN THIS
PROXY; BUT IF ONE SHAREHOLDER SIGNS, THIS SIGNATURE BINDS THE OTHER
SHAREHOLDER(S). WHEN SIGNING AS AN ATTORNEY, EXECUTOR, ADMINISTRATOR, AGENT,
TRUSTEE, GUARDIAN, OR CUSTODIAN FOR A
<PAGE>
MINOR, PLEASE GIVE FULL TITLE AS SUCH. IF A CORPORATION, PLEASE SIGN IN FULL
CORPORATE NAME BY AN AUTHORIZED PERSON. IF A PARTNERSHIP, PLEASE SIGN IN
PARTNERSHIP NAME BY AN AUTHORIZED PERSON.
THIS PROXY MAY BE REVOKED BY THE SHAREHOLDER(S) AT ANY TIME PRIOR TO THE
SPECIAL MEETING OF THE SHAREHOLDERS.
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Signature (PLEASE SIGN WITHIN BOX) Date
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Signature (Joint Owners) Date
