As filed with the Securities and Exchange Commission on October 27, 1995
Registration Nos. 2-16590
811-945
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT
Under the
SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 61 [x]
and/or
REGISTRATION STATEMENT
Under the
INVESTMENT COMPANY ACT OF 1940 [x]
Amendment No. 61
(Check appropriate box or boxes.)
Phoenix Worldwide Opportunities Fund
(Exact Name of Registrant as Specified in Declaration of Trust)
101 Munson Street, Greenfield, Massachusetts 01301
(Address of Principal Executive Offices) (Zip Code)
c/o Phoenix Equity Planning
Corporation -- Shareholder Services
(800) 243-1574
(Registrant's Telephone Number, including Area Code)
Philip R. McLoughlin
Phoenix Worldwide Opportunities Fund
c/o Phoenix Home Life Mutual Insurance Co.
One American Row
Hartford, Connecticut 06115
(name and address of Agent for Service)
Approximate Date of Proposed Public Offering:
It is proposed that this filing will become effective (check appropriate box)
[x] immediately upon filing pursuant to paragraph (b)
[ ] on pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(i)
[ ] on pursuant to paragraph (a)(i)
[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on pursuant to paragraph (a)(ii) of Rule 485.
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has registered an indefinite number of shares under the Securities
Act of 1933 pursuant to Rule 24f-2 under the Investment Company Act of 1940.
A Rule 24f-2 Notice for the fiscal year ended on June 30, 1995 was filed by
Registrant with the Commission on August 28, 1995.
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
Cross Reference Sheet Pursuant to Rule 404
PART A
<TABLE>
<CAPTION>
Part I of Form N-1A Prospectus Caption
- ---------------------------------------------------- --------------------------------------------------------
<S> <C>
1. Cover Page Cover Page
2. Synopsis Introduction; Fund Expenses
3. Condensed Financial Information Financial Highlights
4. General Description of Registrant Investment Objectives and Policies
5. Management of the Fund Management of the Fund
6. Capital Stock and Other Securities Dividends, Distributions and Taxes; Additional
Information; Investor Accounts and Services Available
7. Purchase of Securities Being Offered How to Buy Shares; The Underwriter; How to Obtain
Reduced Sales Charges; Net Asset Value; Investor
Accounts and Services Available
8. Redemption or Repurchase How to Redeem Shares
9. Pending Legal Proceeding Not Applicable
PART B
Part I of Form N-1A Statement of Additional Information
- ---------------------------------------------------- ---------------------------------------------------------
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information Cover Page; The Fund
13. Investment Objectives and Policies Cover Page; Investment Objective and Policies; Other
Investment Techniques; Investment Restrictions
14. Management of the Fund Services of the Adviser; Trustees and Officers
15. Control Persons and Principal Holders of
Securities Not Applicable
16. Investment Advisory & Other Services Trustees and Officers
17. Brokerage Allocation and Other Practices Portfolio Transactions and Brokerage
18. Capital Stock and Other Securities Not Applicable
19. Purchase, Redemption and Pricing of Securities How to Buy Shares; Alternative Purchase Arrangements;
Exchange Privileges; Redemption of Shares; Net Asset
Value; Reinstatement Privilege
20. Tax Status Dividends, Distributions and Taxes
21. Underwriter Distribution Plans
22. Calculation of Performance Data Performance Information
23. Financial Statements Financial Statements
</TABLE>
<PAGE>
Phoenix Worldwide Opportunities Fund
P.O. Box 2200
Enfield, CT 06083-2200
[logo] Phoenix Investments
PEP 691 (10/95)
Bulk Rate Mail
U.S. Postage
PAID
Springfield, MA
Permit No. 444
Phoenix Funds
Phoenix Worldwide
Opportunities Fund
Prospectus
October 30, 1995
[logo] Phoenix Investments
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
101 Munson Street
Greenfield, MA 01301
PROSPECTUS
October 30, 1995
Phoenix Worldwide Opportunities Fund (the "Fund") is a diversified
open-end investment management company which invests in domestic and non-U.S.
issuers, including companies, governments, governmental agencies and
international organizations with the investment objective of capital
appreciation. Equity securities are the major portion of the Fund's
investments. Securities will be selected primarily for growth potential, and
any income dividends derived from portfolio holdings will be considered
incidental to the Fund's investment objective. There can be no assurance that
the Fund's objective will be achieved.
No dealer, salesperson or any other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus, and, if given or made, such information or representations must
not be relied upon. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities offered hereby in any
state in which or to any person to whom it is unlawful to make such offer.
Neither the delivery of this Prospectus nor any sale hereunder shall, under
any circumstances, create any implication that information herein is correct
at any time subsequent to its date.
This Prospectus sets forth concisely the information about the Fund that a
prospective investor should know before investing. Investors should read and
retain this Prospectus for future reference. Additional information about the
Fund is contained in the Statement of Additional Information, dated October
30, 1995, which has been filed with the Securities and Exchange Commission
(the "Commission") and is available at no charge by calling (800) 243-4361.
The Statement of Additional Information, as amended, is incorporated herein
by reference.
Shares of the Fund are not deposits or obligations of, or guaranteed or
endorsed by, any bank, credit union, or affiliated entity, and are not
federally insured or otherwise protected by the Federal Deposit Insurance
Corporation (FDIC), the Federal Reserve Board, or any other agency and
involve investment risk, including possible loss of principal.
LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
CUSTOMER SERVICE: (800) 243-1574
MARKETING: (800) 243-4361
TELEPHONE ORDERS/EXCHANGES: (800) 367-5877
TELECOMMUNICATION DEVICE (TTY): (800) 243-1926
<PAGE>
TABLE OF CONTENTS
PAGE
-------
INTRODUCTION 3
FUND EXPENSES 4
FINANCIAL HIGHLIGHTS 5
PERFORMANCE INFORMATION 6
INVESTMENT OBJECTIVE AND POLICIES 6
INVESTMENT TECHNIQUES 7
INVESTMENT RESTRICTIONS 9
MANAGEMENT OF THE FUND 9
DISTRIBUTION PLANS 10
HOW TO BUY SHARES 11
INVESTOR ACCOUNTS AND SERVICES AVAILABLE 15
NET ASSET VALUE 17
HOW TO REDEEM SHARES 18
DIVIDENDS, DISTRIBUTIONS AND TAXES 19
ADDITIONAL INFORMATION 20
2
<PAGE>
INTRODUCTION
This Prospectus describes the shares offered by and the operations of
Phoenix Worldwide Opportunities Fund (the "Fund"). The Fund is a diversified,
open-end management investment company established as a business trust under
the laws of Massachusetts. The Fund's investment objective is capital
appreciation. The Fund invests in domestic and non-U.S. issuers.
Investment Adviser
National Securities & Research Corporation ("National" or the "Adviser") is
the investment adviser of the Fund. The Adviser is a wholly-owned indirect
subsidiary of Phoenix Home Life Mutual Insurance Company. See "Management of
the Fund" for a description of the Investment Advisory Agreement. As
compensation for its services, the Adviser receives a fee which is accrued
daily against the value of the Fund's net assets and is paid monthly by the
Fund. The fee is computed at the annual rate of 0.75% of the Fund's average
daily net assets up to $1 billion, 0.70% of the Fund's average daily net
assets between $1 billion and $2 billion, and 0.65% of the Fund's average
daily net assets in excess of $2 billion.
Distribution Plans and Distributor
Phoenix Equity Planning Corporation ("Equity Planning" or "Distributor")
serves as Distributor of the Fund's shares. See "The Underwriter",
"Distribution Plans" and the Statement of Additional Information. Equity
Planning also acts as financial agent of the Fund and as such receives a
quarterly fee based on the average of the aggregate daily net asset values of
the Fund at an annual rate of $300 per $1 million. Equity Planning also
serves as the Fund's transfer agent.
The Fund has adopted distribution plans pursuant to Rule 12b-1 under the
Investment Company Act of 1940 (the "1940 Act"). Pursuant to the distribution
plan adopted for Class A Shares, the Fund shall reimburse the Distributor up
to a maximum annual rate of 0.30% of the Fund's average daily Class A Share
net assets for distribution expenditures incurred in connection with the sale
and promotion of Class A Shares and for furnishing shareholder services.
Although the Class A shares Plan continues to provide for a 0.30%
distribution fee, the Underwriter has voluntarily agreed to limit the Rule
12b-1 fee charged to Class A Shares to 0.25% for the fiscal year 1996.
Pursuant to the distribution plan adopted for Class B Shares, the Fund shall
reimburse the Distributor up to a maximum annual rate of 1.00% of the Fund's
average daily Class B Share net assets for distribution expenditures incurred
in connection with the sale and promotion of Class B Shares and for
furnishing shareholder services. See "Distribution Plans".
Purchase of Shares
The Fund offers two classes of shares of beneficial interest on a continuous
basis which may be purchased at a price equal to their net asset value per
share plus a sales charge which, at the election of the purchaser, may be
imposed (i) at the time of the purchase (the "Class A Shares") or (ii) on a
contingent deferred basis (the "Class B Shares").
Completed applications for the purchase of shares should be mailed to the
Phoenix Funds, c/o State Street Bank and Trust Company, P.O. Box 8301,
Boston, MA 02266-8301.
Class A Shares are offered to the public at the next determined net asset
value after receipt of the order by State Street Bank and Trust Company plus
a maximum sales charge of 4.75% of the offering price (4.99% of the amount
invested) on single purchases of less than $50,000. The sales charge for
Class A Shares is reduced on a graduated scale on single purchases of $50,000
or more and subject to other conditions stated below. See "How to Buy
Shares", "How to Obtain Reduced Sales Charges on Class A Shares" and "Net
Asset Value".
Class B Shares are offered to the public at the next determined net asset
value after receipt of an order by State Street Bank and Trust Company with
no sales charge. However, Class B Shares are subject to a sales charge if
they are redeemed within five years of purchase. See "How to Buy Shares" and
"Deferred Sales Charge Alternative--Class B Shares".
Minimum Initial and Subsequent Investments
The minimum initial investment is $500 ($25 if using the bank draft
investment program designated "Investo-Matic") and the minimum subsequent
investment is $25. Exceptions to the minimum and subsequent investment
amounts are available under certain circumstances. See "How to Buy Shares".
Redemption Price
Class A Shares may be redeemed at any time at the net asset value per share
next computed after receipt of a redemption request by Equity Planning, the
Fund's transfer agent. Class B shareholders redeeming shares within five
years of the date of purchase will normally be assessed a contingent deferred
sales charge. See "How to Redeem Shares".
Risk Factors
There can be no assurance that the Fund will achieve its investment
objectives. The Fund is intended for long-term investors who can accept the
risks involved in investments in non-U.S. securities. Investing in such
securities involves different risk considerations from those associated with
investing solely in U.S. securities. In addition, investors should consider
risks inherent in an international portfolio, including foreign exchange rate
fluctuations and exchange controls, and certain of the investing policies
which the Fund may employ, including the entering into of forward foreign
currency exchange contracts and option transactions. Investors should be
aware that the Fund's net asset value will fluctuate as the fair market value
of the securities in which the Fund invests fluctuates. In addition, special
risks may be presented by the particular types of securities in which the
Fund may invest. See "Investment Objective and Policies".
3
<PAGE>
FUND EXPENSES
The following table illustrates all fees and expenses a shareholder will
incur. The fees and expenses set forth in the table were for fiscal year
ended June 30, 1995.
<TABLE>
<CAPTION>
Class A Class B
Shares Shares
------- ------------------------------
<S> <C> <C>
Shareholder Transaction Expenses
Maximum Sales Load Imposed on Purchases (as a percentage of offering
price) 4.75% None
Maximum Sales Load Imposed on Reinvested Dividends None None
Deferred Sales Load None 5% during the first
year, decreasing 1%
annually to 2%
during the fourth
and fifth years;
thereafter decreasing
None to 0% after the fifth year.
Redemption Fee None None
Exchange Fee None None
Annual Fund Expenses
(as a percentage of net assets for the year ended June 30, 1995)
Management Fees 0.75% 0.75%
Rule 12b-1 Fees (a) 0.25% 1.00%
Other Operating Expenses 0.80% 0.80%
----- -----
Total Fund Operating Expenses 1.80% 2.55%
===== =====
</TABLE>
(a) "Rule 12b-1 Fees" represent an asset based sales charge that, for a
long term shareholder, may be higher than the maximum front-end sales charge
permitted by the National Association of Securities Dealers, Inc. ("NASD").
While the Class A Share Distribution Plan continues to provide for a 0.30%
distribution fee, the Distributor has voluntarily agreed to limit the fee to
0.25% for the fiscal year 1996.
<TABLE>
<CAPTION>
Cumulative Expenses
Paid for the Period
Example* 1 year 3 years 5 years 10 years
- ----------------------------------------------------------------- ------- ------- ------- ---------
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a $1,000
investment assuming, (1) a 5% annual return and (2) redemption
at the end of each time period:
Class A Shares $65 $101 $140 $249
Class B Shares $76 $109 $156 $270
An investor would pay the following expenses on the same $1,000
investment assuming no redemption at the end of the period:
Class A Shares $65 $101 $140 $249
Class B Shares $26 $ 79 $136 $270
</TABLE>
*The purpose of the table above is to help the investor understand the
various costs and expenses the investor will bear directly or indirectly. The
example should not be considered a representation of past or future expenses.
Actual expenses may be greater or less than those shown. See "Management of
the Fund," "Distribution Plans," and "How to Buy Shares."
4
<PAGE>
FINANCIAL HIGHLIGHTS
The following table sets forth certain financial information for respective
fiscal years of the Fund. The financial information has been audited by Price
Waterhouse LLP, independent accountants. Financial statements and notes
thereto are incorporated by reference in the Statement of Additional
Information. The Statement of Additional Information and the Fund's most
recent Annual Report (which contains a discussion of the Fund's performance)
are available at no charge upon request by calling (800) 243-4361.
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
Phoenix Worldwide Opportunities Fund
<TABLE>
<CAPTION>
Class A
---------------------------------------------------------------------
Year Ended June 30,
---------------------------------------------------------------------
1995 1994 1993 1992 1991 1990
-------- -------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $10.17 $ 8.00 $ 7.18 $ 6.82 $ 7.56 $ 7.49
Income from investment operations:
Net investment income (loss) 0.01((3)) 0.01 0.03 0.01((2)) 0.23((1)) 0.19((1,3))
Net realized and unrealized gain
(loss) 0.56 2.19 0.79 0.36 (0.67) (0.02)
------ ------ ------ ------ ------ --------
Total from investment operations 0.57 2.20 0.82 0.37 (0.44) 0.17
------ ------ ------ ------ ------ --------
Less distributions:
Dividends from net investment
income -- (0.03) -- (0.01) (0.30) (0.10)
Distributions from net realized
gains (1.37) -- -- -- -- --
In excess of net realized gains (0.33) -- -- -- -- --
------ ------ ------ ------ ------ --------
Total distributions (1.70) (0.03) -- (0.01) (0.30) (0.10)
------ ------ ------ ------ ------ --------
Change in net asset value (1.13) 2.17 0.82 0.36 (0.74) 0.07
------ ------ ------ ------ ------ --------
Net asset value, end of period $ 9.04 $10.17 $ 8.00 $ 7.18 $ 6.82 $ 7.56
====== ====== ====== ====== ====== ========
Total return ((4)) 6.53% 27.46% 11.42% 5.43% (5.27%) 2.19%
Ratios/supplemental data:
Net assets, end of period
(in thousands) $126,481 $118,707 $88,870 $63,354 $59,874 $70,388
Ratio of expenses to average net
assets 1.80% 1.50% 1.88% 2.15%((2)) 1.75%((1)) 1.33%((1))
Ratio of net income to average net
assets 0.16% 0.09% 0.61% 0.16% 3.46% 2.44%
Portfolio turnover 277% 259% 95% 51% 76% 119%
</TABLE>
<TABLE>
<CAPTION>
Class A Class B
-------------------------------------------- ----------
From
Inception
7/15/94 to
1989 1988 1987 1986 6/30/95
-------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $ 8.00 $ 10.14 $ 12.36 $ 9.38 $10.40
Income from investment operations:
Net investment income (loss) 0.16 0.14 0.07 0.12 (0.02)((3))
Net realized and unrealized gain (loss) (0.53) (0.61) 0.48 2.98 0.30
------ ------ ------ ------ --------
Total from investment operations (0.37) (0.47) 0.55 3.10 0.28
------ ------ ------ ------ --------
Less distributions:
Dividends from net investment income (0.14) (0.13) (0.09) (0.06) --
Distributions from net realized gains -- (1.54) (2.68) (0.06) (1.37)
In excess of net realized gains -- -- -- -- (0.33)
------ ------ ------ ------ --------
Total distributions (0.14) (1.67) (2.77) (0.12) (1.70)
------ ------ ------ ------ --------
Change in net asset value (0.51) (2.14) (2.22) 2.98 (1.42)
------ ------ ------ ------ --------
Net asset value, end of period $ 7.49 $ 8.00 $ 10.14 $ 12.36 $ 8.98
====== ====== ====== ====== ========
Total return ((4)) (4.62%) (6.49%) 8.56% 33.45% 3.54%((5))
Ratios/supplemental data:
Net assets, end of period (in thousands) $33,881 $45,207 $52,631 $57,275 $2,849
Ratio of expenses to average net assets 1.40% 1.23% 1.20% 1.17% 2.61%((6))
Ratio of net income to average net assets 1.83% 1.81% 0.73% 0.95% (0.33)%((6))
Portfolio turnover 87% 144% 180% 196% 277%
</TABLE>
(1) Net investment income would have been $.22 and $.17 and the ratio of
operating expenses to average net assets would have been 1.89% and 1.64%
for the years ended June 30, 1991 and 1990, respectively, had the Manager
not reimbursed a portion of its management fees, pursuant to the then
applicable expense limitations.
(2) Net investment income would have been the same $.01 and the ratio of net
expenses to average net assets would have been 2.18% for the year ended
June 30, 1992, had the subadviser not reimbursed a portion of its
management fees.
(3) Computed using the monthly average number of shares outstanding during
the period.
(4) Maximum sales load is not reflected in the total return calculation.
(5) Not annualized
(6) Annualized
5
<PAGE>
PERFORMANCE INFORMATION
The Fund may, from time to time, include its total return in advertisements
or reports to shareholders or prospective investors. Total return figures are
computed separately for Class A and Class B Shares in accordance with
formulas specified by the Securities and Exchange Commission and are based on
historical earnings and are not intended to indicate future performance.
Standardized quotations of average annual total return for Class A and Class
B Shares will be expressed in terms of the average annual compounded rate of
return of a hypothetical investment in either Class A or Class B Shares over
a period of 1, 5 and 10 years (or up to the life of the class of shares).
Standardized total return quotations reflect the deduction of a proportional
share of each Class's expenses (on an annual basis), deduction of the maximum
initial sales load in the case of Class A Shares and the maximum contingent
deferred sales charge applicable to a complete redemption of the investment
in the case of Class B Shares, and assume that all dividends and
distributions on Class A and Class B Shares are reinvested when paid. It is
expected that the performance of Class A Shares will be better than that of
Class B Shares as a result of lower distribution fees paid by Class A Shares.
The Fund may also quote supplementally a rate of total return over different
periods of time by means of aggregate, average, and year-by-year or other
types of total return figures. In addition, the Fund may from time to time
publish materials citing historical volatility for shares of the Fund.
The Fund may from time to time include in advertisements containing total
return the ranking of those performance figures relative to such figures for
groups of mutual funds having similar investment objectives as categorized by
ranking services such as Lipper Analytical Services, Inc., CDA Investment
Technologies, Inc., Weisenberger Financial Services, Inc. and Morningstar,
Inc. Additionally, the Fund may compare its performance results to other
investment or savings vehicles (such as certificates of deposit) and may
refer to results published in various publications such as Changing Times,
Forbes, Fortune, Money, Barrons, Business Week, Investor's Daily, Stanger's
Mutual Fund Monitor, The Stanger Register, Stanger's Investment Adviser, The
Wall Street Journal, The New York Times, Consumer Reports, Registered
Representative, Financial Planning, Financial Services Weekly, Financial
World, U.S. News and World Report, Standard & Poor's The Outlook, and
Personal Investor. The Fund may from time to time illustrate the benefits of
tax deferral by comparing taxable investments to investments made through
tax- deferred retirement plans. The total return may also be used to compare
the performance of the Fund against certain widely acknowledged outside
standards or indices for stock and bond market performance, such as the
Standard & Poor's 500 Stock Index (the "S&P 500"), Dow Jones Industrial
Average, Europe Australia Far East Index (EAFE), Consumer's Price Index,
Shearson Lehman Corporate Index and Shearson Lehman T-Bond Index. The S&P 500
is a commonly quoted market value- weighted and unmanaged index showing the
changes in the aggregate market value of 500 common stocks relative to the
base period 1941-43. The S&P 500 is composed almost entirely of common stocks
of companies listed on the New York Stock Exchange, although the common
stocks of a few companies listed on the American Stock Exchange or traded
over the counter are included. The 500 companies represented include 400
industrial, 60 transportation and 40 financial services concerns. The S&P 500
represents about 80% of the market value of all issues traded on the New York
Stock Exchange.
Advertisements, sales literature and communications may contain information
about the Fund or Adviser's current investment strategies and management
style. Current strategies and style may change to allow the Fund to respond
quickly to a changing market and economic conditions. From time to time the
Fund may include specific portfolio holdings or industries in such
communications. To illustrate components of overall performance, the Fund may
separate its cumulative and average annual returns into income results and
capital gains or losses; or cite separately as a return figure the equity or
bond portion of the Fund's portfolio; or compare the Fund's equity or bond
return figure to well-known indices of market performance including but not
limited to: the S&P 500 Index, Dow Jones Industrial Average, Morgan Stanley
Capital International World (net) Index, First Boston High Yield Index and
Salomon Brothers Corporate and Government Bond Indices.
Performance information for the Fund reflects only the performance of a
hypothetical investment in Class A or Class B Shares of the Fund during the
particular time period on which the calculations are based. Performance
information should be considered in light of the Fund's investment objective
and policies, characteristics and quality of the portfolio, and the market
conditions during the given time period, and should not be considered as a
representation of what may be achieved in the future. For a description of
the methods used to determine total return for the Fund, see the Statement of
Additional Information.
The Fund's Annual Report, available upon request and without charge,
contains a discussion of the performance of the Fund and a comparison of that
performance to a securities market index.
INVESTMENT OBJECTIVE AND POLICIES
The Fund's investment objective is capital appreciation. Any current income
that is earned will be considered incidental to the achievement of capital
appreciation. There can be no assurance that the Fund will achieve its
investment objective. The Fund's investment objective is a fundamental policy
and may not be changed without shareholder approval.
The Fund invests in a diversified portfolio of securities of companies and
governments located throughout the world. The Fund will not limit its
investments to any particular regions of the world or to issuers of any
particular size. The Adviser will seek to identify opportunities for capital
appreciation in developed countries and in countries whose economies are
still emerging and developing.
Under normal circumstances, at least 65% of the total assets of the Fund
will be invested in the securities of issuers located in at least three
different countries, one of which will be the
6
<PAGE>
United States. The Fund will invest primarily in equity securities (common
stocks, preferred stocks, securities convertible into common stocks, warrants
and any rights to purchase common stocks). The Fund may also invest up to 35%
of its assets in non- convertible fixed-income securities of U.S. and
non-U.S. issuers (described below) when it is determined by the Adviser that
such securities are appropriate for achievement of the Fund's investment
objective. The market value of fixed-income securities can be expected to
vary inversely to changes in prevailing interest rates, therefore investing
in such fixed-income securities can provide an opportunity for capital
appreciation when interest rates are expected to decline. The Fund may invest
up to 5% of its net assets in fixed income securities rated below investment
grade (commonly referred to as "junk bonds").
The non-convertible fixed-income securities referred to above will consist
of (1) corporate notes, bonds and debentures of U.S. issuers that are rated
high grade (i.e., rated within the three highest rating categories by a
nationally recognized statistical rating organization ("NRSRO")) or, if
unrated, are deemed by the Adviser to be of comparable quality to those
securities that are rated high grade, (2) corporate notes, bonds, debentures
and other securities (such as Euro-currency instruments) of non-U.S. issuers
that are rated within the three highest rating categories of rating services
chosen by the Adviser to rate foreign debt obligations or, if unrated, are
deemed by the Adviser to be of comparable credit quality to rated securities
that may be purchased and (3) Treasury bills, notes and bonds issued by the
United States Government or its agencies or instrumentalities and securities
issued by foreign governments and supranational agencies (such as the World
Bank).
The Fund may, for daily cash management purposes, invest in the
non-convertible fixed income securities described above or in high quality
money market securities. In addition, the Fund may invest, without limit, in
any combination of the U.S. government securities and money market securities
referred to above when, in the opinion of the Adviser it is determined that a
temporary defensive position is warranted based upon current market
conditions. In such instances, the Fund will not be achieving its stated
investment objective.
The percentage of the Fund's assets invested in particular geographic
sectors will shift from time to time in accordance with the judgment of the
Adviser.
INVESTMENT TECHNIQUES
Covered Call Options
The Fund may write covered call option contracts on U.S. securities which
the Fund owns if such options are listed on an organized securities exchange
and the Adviser determines that it is consistent with the Fund's investment
objective.
Forward Foreign Currency Exchange Contracts
In order to hedge against adverse movements in exchange rates between
currencies, the Fund may enter into forward foreign currency exchange
contracts ("forward currency contracts") for the purchase or sale of a
specified currency at a specified future date. Such contracts may involve the
purchase or sale of a foreign currency against the U.S. dollar or may involve
two foreign currencies. The Fund may enter into forward currency contracts
either with respect to specific transactions or with respect to the Fund's
portfolio positions. For example, when the Fund anticipates making a purchase
or sale of a security, it may enter into a forward currency contract in order
to set the rate (either relative to the U.S. dollar or another currency) at
which a currency exchange transaction related to the purchase or sale will be
made. Further, when the Adviser believes that a particular currency may
decline compared to the U.S. dollar or another currency, the Fund may enter
into a forward contract to sell the currency that the Adviser expects to
decline in an amount approximating the value of some or all of the Fund's
portfolio securities denominated in that currency. For a discussion of the
risks associated with such contracts, see "Risk Factors and Special
Considerations."
Futures Contracts on Foreign Currencies and Options on Futures Contracts
The Fund may engage in futures contracts on foreign currencies and options
on these futures transactions as a hedge against changes in the value of the
currencies to which the Fund is subject or to which the Fund expects to be
subject in connection with future purchases, in accordance with the rules and
regulations of the Commodity Futures Trading Commission (the "CFTC"). The
Fund also may engage in such transactions when they are economically
appropriate for the reduction of risks inherent in the ongoing management of
the Fund.
The Fund may buy and sell futures contracts on foreign currencies and
groups of foreign currencies. The Fund will engage in transactions in only
those futures contracts and options thereon that are traded on a commodities
exchange or a board of trade. A "sale" of a futures contract means the
assumption of a contractual obligation to deliver the specified amount of
foreign currency at a specified price in a specified future month. A
"purchase" of a futures contract means the assumption of a contractual
obligation to acquire the currency called for by the contract at a specified
price in a specified future month. At the time a futures contract is
purchased or sold, the Fund must allocate cash or securities as a deposit
payment (initial margin). Thereafter, the futures contract is valued daily
and the payment of "variation margin" may be required, resulting in the
Fund's providing or receiving cash that reflects any decline or increase in
the contract's value, a process known as "marking to market."
Options on Foreign Currencies
The Fund may purchase and write put and call options on foreign currencies
traded on securities exchanges or boards of trade (foreign and domestic) for
hedging purposes in a manner similar to that in which forward currency
contracts and futures contracts on foreign currencies will be employed.
Options on foreign currencies are similar to options on stock, except that
the Fund has the right to take or make delivery of a specified amount of
foreign currency, rather than stock.
The Fund may purchase and write options to hedge the Fund's portfolio
securities denominated in foreign currencies. If there is a decline in the
dollar value of a foreign currency in which the Fund's
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<PAGE>
portfolio securities are denominated, the dollar value of such securities
will decline even though foreign currency value remains the same. See "Risk
Factors and Special Considerations." To hedge against the decline of the
foreign currency, the Fund may purchase put options on such foreign currency.
If the value of the foreign currency declines, the gain realized on the put
option would offset, in whole or in part, the adverse effect such decline
would have on the value of the portfolio securities. Alternatively, the Fund
may write a call option on the foreign currency. If the value of the foreign
currency declines, the option would not be exercised and the decline in the
value of the portfolio securities denominated in such foreign currency would
be offset in part by the premium the Fund received for the option.
If, on the other hand, the Adviser anticipates purchasing a foreign
security and also anticipates a rise in the value of such foreign currency
(thereby increasing the cost of such security), the Fund may purchase call
options on the foreign currency. The purchase of such options could offset,
at least partially, the effects of the adverse movements of the exchange
rates. Alternatively, the Fund could write a put option on the currency and,
if the exchange rates move as anticipated, the option would expire
unexercised.
Other Policies
The Fund is authorized to invest in the securities of other investment
companies subject to the limitations contained in the 1940 Act. In certain
countries, investments by the Fund may only be made through investments in
other investment companies that, in turn, are authorized to invest in the
securities that are issued in such countries. Investors should recognize that
the Fund's purchase of the securities of such other investment companies
results in the layering of expenses such that investors indirectly bear a
proportionate part of the expenses for such investment companies including
operating costs, and investment advisory and administrative fees.
The Fund generally invests for the long-term; however, it may attempt to
take advantage of short-term trends in the market occasioning more trading.
In such cases, the Fund's annual portfolio turnover rate may exceed 100%. The
annual portfolio turnover rate indicates changes in a fund's portfolio.
Higher portfolio turnover in any given year will result in the payment by a
fund of increased amounts of brokerage commissions and will result in the
acceleration of realization of capital gains or losses for tax purposes.
Risk Factors and Special Considerations
Investing in the securities of non-U.S. companies involves special risks and
considerations not typically associated with investing in U.S. companies.
These include differences in accounting, auditing and financial reporting
standards, generally higher commission rates on foreign portfolio
transactions, the possibility of expropriation or confiscatory taxation,
adverse changes in investment or exchange control regulations, political
instability which could affect U.S. investments in foreign countries, and
potential restrictions on the flow of international capital. Additionally,
dividends payable on foreign securities may be subject to foreign taxes
withheld prior to distribution. Foreign securities often trade with less
frequency and volume than domestic securities and therefore may exhibit
greater price volatility, and changes in foreign exchange rates will affect
the value of those securities which are denominated or quoted in currencies
other than the U.S. dollar. Many of the foreign securities held by the Fund
will not be registered with, nor the issuers thereof be subject to the
reporting requirements of, the U.S. Securities and Exchange Commission.
Accordingly, there may be less publicly available information about the
securities and about the foreign company or government issuing them than is
available about a domestic company or government entity. Moreover, individual
foreign economies may differ favorably or unfavorably from the United States
economy in such respects as growth of Gross National Product, rate of
inflation, capital reinvestment, resource self-sufficiency and balance of
payment positions.
The Fund's use of forward currency contracts involves certain investment
risks and transaction costs to which it might not otherwise be subject. These
include: (1) the Adviser may not always be able to accurately predict
movements within currency markets, (2) the skills and techniques needed to
use forward currency contracts are different from those needed to select the
securities in which the Fund invests and (3) there is no assurance that a
liquid secondary market will exist that would enable the Adviser to "close
out" existing (current) contracts when doing so is desirable. The Fund's
successful use of forward currency contracts, options on foreign currencies,
futures contracts on foreign currencies and options on such contracts depends
upon the Adviser's ability to predict the direction of the market and
political conditions, which require different skills and techniques than
predicting changes in the securities markets generally. For instance, if the
value of the securities being hedged moves in a favorable direction, the
advantage to the Fund would be wholly or partially offset by a loss in the
forward contracts or futures contracts. Further, if the value of the
securities being hedged does not change, the Fund's net income would be less
than if the Fund had not hedged since there are transactional costs
associated with the use of these investment practices. These practices are
subject to various additional risks. The correlation between movements in the
price of options and futures contracts and the price of the currencies being
hedged is imperfect. The use of these instruments will hedge only the
currency risks associated with investments in foreign securities, not market
risks. In addition, if the Fund purchases these instruments to hedge against
currency advances before it invests in securities denominated in such
currency and the currency market declines, the Fund might incur a loss on the
futures contract. The Fund's ability to establish and maintain positions will
depend on market liquidity. The ability of the Fund to close out a futures
position or an option depends upon a liquid secondary market. There is no
assurance that liquid secondary markets will exist for any particular futures
contract or option at any particular time. The loss from investing in futures
contracts is potentially unlimited.
Lower rated securities have speculative characteristics and changes in
economic conditions or other circumstances are more likely to weaken the
issuer's capacity to make principal and
8
<PAGE>
interest payments. In addition, the Fund does not have a policy requiring the
sale of a security whose rating drops below investment grade.
INVESTMENT RESTRICTIONS
The Fund may not invest more than 25% of its total assets in any one
industry. In addition, the Fund will not purchase any securities (excluding
U.S. government securities) if by reason thereof more than 5% of its total
assets (taken at current value) would then be invested in securities of a
single issuer. See the Statement of Additional Information for a detailed
description of all of the Fund's investment restrictions.
MANAGEMENT OF THE FUND
The Fund is a mutual fund, technically known as an open- end management
investment company. The Trustees of the Fund ("Trustees") are responsible for
the overall supervision of the operations of the Fund and perform the various
duties imposed upon trustees by the 1940 Act and the laws of the Commonwealth
of Massachusetts.
The Adviser
Pursuant to a Management Agreement (the "Management Agreement") with the
Fund, National acts as investment adviser to the Fund. In this capacity, the
Adviser, subject to the authority of the Trustees, is responsible for the
overall management of the Fund's business affairs. The Trustees periodically
review the services provided by the Adviser to ensure that the Fund's general
investment policies and programs are being properly carried out and that
administrative services are being provided to the Fund in a satisfactory
manner.
The Adviser is an indirect wholly-owned subsidiary of Phoenix Home Life
Mutual Insurance Company ("Phoenix Home Life"), a mutual insurance company
engaged in the insurance and investment businesses. Phoenix Home Life's
principal place of business is located at One American Row, Hartford,
Connecticut, where the company manages combined assets of approximately $12
billion through advisory accounts and mutual funds. The Adviser also acts as
the investment adviser or manager for Phoenix Asset Reserve, Phoenix
California Tax Exempt Bonds, Inc., Phoenix Income and Growth Fund, Phoenix
Strategic Equity Series Fund, and Phoenix Multi-Sector Fixed Income Fund,
Inc. The Adviser currently has approximately $1.7 billion in assets under
management. The Adviser has acted as an investment adviser for over sixty
years.
As compensation for its services, the Adviser receives a fee which is
accrued daily against the value of the Fund's net assets and is paid monthly
by the Fund. The fee is computed at the annual rate of 0.75% of the Fund's
average daily net assets up to $1 billion, 0.70% of the Fund's average daily
net assets between $1 billion and $2 billion, and 0.65% of the Fund's average
daily net assets in excess of $2 billion. The total advisory fee of 0.75% of
the aggregate net assets of the Fund is greater than that for most mutual
funds; however, the Trustees have determined that it is similar to fees
charged by other mutual funds whose investment objectives are similar to
those of the Fund.
The ratio of management fees to average net assets for the fiscal year
ended June 30, 1995 for Class A Shares and Class B Shares was 0.75%.
The Portfolio Managers
Ms. Jeanne H. Dorey and Mr. John T. Wilson are the co-managers of the Fund
and as such, Ms. Dorey and Mr. Wilson are primarily responsible for the day
to day management of the Fund's investments. Ms. Dorey is also the Portfolio
Manager of Phoenix International Portfolio, advised by Phoenix Investment
Counsel ("PIC"), an affiliate of National. Ms. Dorey has served as Vice
President of PIC since April 1993, and as Portfolio Manager of Phoenix
International Portfolio since February 1993. From 1990 to 1992, Ms. Dorey was
an Investment Analyst and Portfolio Manager with Pioneer Group, Inc. and from
1989 to 1990, Ms. Dorey was an Investment Analyst and Portfolio Manager with
Bank of Boston. Since May 14, 1993, she has also served as Vice President of
National. Mr. Wilson has served as co-manager of the Fund since April 1, 1994
and as co-manager of the Phoenix Capital Appreciation Portfolio of the
Phoenix Multi-Portfolio Fund since January, 1994. Mr. Wilson has been
portfolio manager of the Growth Series of The Phoenix Edge Series Fund since
January, 1992 and has been Portfolio Manager, Phoenix Home Life Mutual
Insurance Company since 1990.
The Underwriter
Pursuant to an Underwriting Agreement with the Fund, Equity Planning (the
"Underwriter"), is the underwriter of each Class of the Fund's shares. The
offices of the Underwriter are located at 100 Bright Meadow Blvd., P.O. Box
2200, Enfield, CT 06083-2200. The Underwriter conducts a continuous offering
pursuant to a "best efforts" arrangement requiring it to take and pay for
only such securities as may be sold to the public through investment dealers.
The Underwriter may sell Fund shares through its registered representatives
or through dealers with whom it has sales agreements.
The Underwriter is an indirect wholly owned subsidiary of Phoenix Home
Life. The Underwriter also acts as underwriter of shares in the Phoenix
Series Fund, Phoenix Multi-Portfolio Fund, Phoenix Total Return Fund, Inc.,
Phoenix Multi-Sector Fixed Income Fund, Inc., Phoenix Asset Reserve, Phoenix
California Tax Exempt Bonds, Inc., Phoenix Income and Growth Fund and the
Phoenix Strategic Equity Series Fund (which, together with the Fund, are
hereinafter collectively referred to as the "Phoenix Funds").
Pursuant to a Financial Agent Agreement with the Phoenix Funds, Equity
Planning acts as administrative agent of the Fund and, as such, performs
administrative, bookkeeping and pricing functions for the Fund. As compensation,
Equity Planning receives a quarterly fee based on the average of the aggregate
daily net asset values of the Fund at the annual rate of $300 per $1 million.
For its services during the Fund's fiscal year ended June 30, 1995, Equity
Planning received $38,911 or 0.03% of average net assets.
The Custodian and Transfer Agent
The Fund's custodian is Brown Brothers Harriman & Co. (the "Custodian"), 40
Water Street, Boston, Massachusetts
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02109, Attention: Manager, Securities Division. Pursuant to a Transfer Agent
and Service Agreement with the Phoenix Funds, Equity Planning acts as
transfer agent for the Fund (the "Transfer Agent") for which it is paid
$14.95 for each designated account. The Transfer Agent engages sub-agents to
perform certain shareholder servicing functions for which such agents shall
be paid a fee by Equity Planning.
DISTRIBUTION PLANS
The Fund has adopted separate distribution plans under Rule 12b-1 of the
1940 Act for each class of shares of the Fund (the "Class A Plan", the "Class
B Plan", and collectively the "Plans"). The Plans permit the Fund to
reimburse the Underwriter for expenses incurred in connection with the sale
and promotion of Fund shares and the furnishing of shareholder services.
Pursuant to the Class A Plan, the Fund may reimburse the Underwriter for
actual expenses of the Underwriter up to 0.30% annually for the average daily
net assets of the Fund's Class A Shares. However, the Underwriter has
voluntarily agreed to limit the maximum amount of reimbursement under the
Class A Plan for the fiscal year 1996 to 0.25% annually of the average daily
net assets of the Fund's Class A Shares. Under the Class B Plan, the Fund may
reimburse the Underwriter monthly for actual expenses of the Underwriter up
to 1.00% annually of the average daily net assets of the Fund's Class B
Shares.
Expenditures incurred under the Plans may consist of: (i) commissions to
sales personnel for selling shares of the Fund (including underwriting
commissions and finance charges related to the payment of commissions for
sales of Class B Shares); (ii) compensation, sales incentives and payments to
sales, marketing and service personnel; (iii) payments to broker-dealers and
other financial institutions which have entered into agreements with the
Underwriter for services rendered in connection with the sale and
distribution of shares of the Fund and the provision of shareholder services;
(iv) payment of expenses incurred in sales and promotional activities,
including advertising expenditures related to the Fund; (v) the costs of
preparing and distributing promotional materials; (vi) the costs of printing
the Fund's Prospectus and Statement of Additional Information for
distribution to potential investors; and (vii) such other similar services
that the Trustees of the Fund determine are reasonably calculated to result
in the sale of shares of the Fund; provided, however, that a portion shall be
equal to or less than 0.25% annually of the average daily net assets of the
Fund shares, may be paid for reimbursing the costs of providing services to
shareholders, including assistance in connection with inquiries related to
shareholder accounts (the "Service Fee"). From the Service Fee the
Underwriter expects to pay a quarterly fee to qualifying broker/dealer firms,
as compensation for providing personal services and/or the maintenance of
shareholder accounts, with respect to shares sold by such firms. This fee
will not exceed on an annual basis 0.25% of the average annual net asset
value of such shares, and will be in addition to sales charges on Fund shares
which are reallowed to such firms. To the extent that the entire amount of
the Service Fee is not paid to such firms, the balance will serve as
compensation for personal and account maintenance services furnished by the
Underwriter. The Underwriter may realize a profit from these arrangements.
In order to receive payments under the Plans, participants must meet such
qualifications as are to be established in the sole discretion of the
Underwriter, such as services to the Fund's shareholders; or services
providing the Fund with more efficient methods of offering shares to groups
of clients; members or prospects of a participant; or services permitting
bulking of purchases or sales, or transmission of such purchases or sales by
computerized tape or other electronic equipment; or other batch processing.
Under the Class A Plan, reimbursement or payment of expenses may not be
made unless such payment or reimbursement occurs prior to the earliest of (a)
the last day of the one-year period commencing on the last day of the
calendar quarter during which the specific service or activity was performed,
or (b) the last day of the one-year period commencing on the last day of the
calendar quarter during which payment for the service or activity was made by
a third party on behalf of the Fund. The Class B Plan, however, does not
limit the reimbursement of distribution-related expenses to expenses incurred
in specified time periods.
For the fiscal year ended June 30, 1995, the Fund paid $320,285 under the
Class A Plan and $15,890 under the Class B Plan. The fees were used to
compensate unaffiliated broker- dealers for servicing shareholder's accounts,
compensating sales personnel and reimbursing the Underwriter for commission
expenses and expenses related to preparation of the marketing material. On a
quarterly basis, the Fund's Trustees review a report on expenditures under
each Plan and the purposes for which expenditures were made. The Trustees
conduct an additional, more extensive review annually in determining whether
each Plan will be continued. By its terms, continuation of each Plan from
year to year is contingent on annual approval by a majority of the Fund's
Trustees and by a majority of the Trustees who are not "interested persons"
(as defined in the 1940 Act) and who have no direct or indirect financial
interest in the operation of either Plan or any related agreements (the "Plan
Trustees"). Each Plan provides that it may not be amended to increase
materially the costs which the Fund may bear without approval of the
applicable class of shareholders of the Fund and that other material
amendments must be approved by a majority of the Plan Trustees by vote cast
in person at a meeting called for the purpose of considering such amendments.
Each Plan further provides that while it is in effect, the selection and
nomination of Trustees who are not "interested persons" shall be committed to
the discretion of the Trustees who are not "interested persons". Each Plan
may be terminated at any time by vote of a majority of the Plan Trustees or a
majority of the applicable class of outstanding shares of the Fund. If the
Plans are terminated in accordance with their terms, the obligations of the
Fund to make payments to the Underwriter pursuant to the Plans, including
payments for expenses carried over from previous years, will cease.
The Trustees have concluded that there is a reasonable likelihood that the
Plans will benefit the Fund and all classes of shareholders. The Class A Plan
was approved by Class A
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shareholders of the Fund at a special meeting of shareholders held on May 7,
1993. The Class B Plan was adopted by the Trustees (including a majority of
independent Trustees) on May 25, 1994.
The National Association of Securities Dealers ("NASD") regards certain
distribution fees as asset-based sales charges subject to NASD sales load
limits. The NASD's maximum sales charge rule may require the Trustees to
suspend distribution fees or amend either or both Plans.
HOW TO BUY SHARES
The Fund currently issues two classes of shares. Class A Shares are sold to
investors choosing the initial sales charge alternative. Class B Shares are
sold to investors choosing the deferred sales charge alternative. The minimum
initial purchase is $500, and the minimum subsequent investment is $25. Both
the minimum initial and subsequent investment amounts are $25 for investments
pursuant to the "Investo- Matic" plan, a bank draft investing program
administered by Equity Planning, or pursuant to the Systematic Exchange
Privilege (see Statement of Additional Information).
Completed applications for the purchase of shares should be mailed to The
Phoenix Funds, c/o State Street Bank and Trust Company, P.O. Box 8301,
Boston, MA 02266-8301.
Each class of shares represents an interest in the same portfolio of
investments of the Fund, has the same rights, and is identical to the other
in all respects, except that Class B Shares bear the expenses of the deferred
sales arrangement and any expenses (including the higher distribution
services fee and any incremental transfer agency costs) resulting from such
sales arrangement. Each class has exclusive voting rights with respect to
provisions of the Rule 12b-1 distribution plan pursuant to which its
distribution services fee is paid and each class has different exchange
privileges. Only the Class B Shares are subject to a conversion feature. The
net income attributable to Class B Shares and the dividends paid on Class B
Shares will be reduced by the amount of the higher distribution services fee
and incremental expenses associated with such distribution services fee;
likewise, the net asset value of the Class B Shares will be reduced by such
amount to the extent the Fund has undistributed net income.
Subsequent investments for the purchase of full and fractional shares in
amounts of $25 or more may be made through an investment dealer or by sending
a check to Phoenix Funds, c/o State Street Bank and Trust Company, P.O. Box
8301, Boston, MA 02266-8301. Share certificates representing any number of
full shares will be issued only on request, and subject to certain
conditions. A fee may be incurred by the shareholder for a lost or stolen
share certificate. Sales personnel of broker-dealers distributing the Fund's
shares may receive differing compensation for selling Class A or Class B
Shares.
The Fund offers combination purchase privileges, letters of intent,
accumulation plas, withdrawal plans and reinvestment and exchange privileges.
Certain privileges may not be available in connection with Class B Shares.
Shares of the Fund or shares of any other Phoenix Fund (except Phoenix Money
Market Fund Series Class A Shares and Phoenix Asset Reserve Class A Shares
held less than 6 months), may be exchanged for shares of the same class on
the basis of the relative net asset values per share at the time of the
exchange. Exchanges are subject to the minimum initial investment requirement
of the designated Phoenix Fund, except if made in connection with the
Systematic Exchange Privilege. Shareholders may exchange shares held in
book-entry form for an equivalent number (value) of the same class of shares
from any other Phoenix Fund. On Class B Share exchanges, the contingent
deferred sales charge schedule of the original shares purchased is not taken
and continues to apply.
Alternative Sales Arrangements
The alternative sales arrangements permit an investor to choose the method
of purchasing shares that is most beneficial given the amount of the
purchase, the length of time the investor expects to hold the shares, whether
the investor wishes to receive distributions in cash or to reinvest them in
additional shares of the Fund, and other circumstances. Investors should
consider whether, during the anticipated life of their investment in the
Fund, the accumulated continuing distribution fee and contingent deferred
sales charges on Class B Shares prior to conversion would be less than the
initial sales charge and accumulated distribution fee on Class A Shares
purchased at the same time, and to what extent such differential would be
offset by the higher yield of Class A Shares. In this regard, Class A Shares
will be more beneficial to the investor who qualifies for certain reduced
initial sales charges. For this reason, the Underwriter intends to limit
sales of Class B Shares sold to any shareholder to a maximum total value of
$250,000. Class B Shares sold to unallocated qualified employer sponsored
plans will be limited to a maximum total value of $1,000,000.
Class B Shares sold to allocated qualified employer sponsored plans,
including 401(k) plans, will be limited to a maximum total value of $250,000
for each participant. The Underwriter reserves the right to decline the sale
of Class B Shares to allocated qualified employer sponsored plans not
utilizing an approved participant tracking system. In addition, Class B
Shares will not be sold to any qualified employee benefit plan, endowment
fund or foundation if, on the date of the initial investment, the plan, fund
or foundation has assets of $10,000,000 or more or at least 100 participant
employees. Class B Shares will also not be sold to investors who have reached
the age of 85 because of such persons' expected distribution requirements.
Class A Shares are subject to a lower distribution fee and, accordingly,
pay correspondingly higher dividends per share. However, because initial
sales charges are deducted at the time of purchase, such investors would not
have all their funds invested initially and, therefore, would initially own
fewer shares. Investors not qualifying for reduced initial sales charges who
expect to maintain their investment for an extended period of time might
consider purchasing Class A Shares because the accumulated continuing
distribution charges on Class B Shares may exceed the initial sales charge
11
<PAGE>
on Class A Shares during the life of the investment. Again, however, such
investors must weigh this consideration against the fact that, because of
such initial sales charge, not all their funds will be invested initially.
However, other investors might determine that it would be more advantageous
to purchase Class B Shares to have all their funds invested initially,
although remaining subject to higher continuing distribution charges and, for
a five-year period, being subject to a contingent deferred sales charge.
Initial Sales Charge Alternative--Class A Shares
The public offering price of Class A Shares is the net asset value plus a
sales charge, as set forth below. Offering prices become effective at the
close of the general trading session of the New York Stock Exchange. Orders
received by dealers prior to such time are confirmed at the offering price
effective at that time, provided the order is received by the Underwriter
prior to its close of business.
The sales charge varies with the size of the purchase and reduced charges
apply to the aggregate of purchases of the Fund made at one time by "any
person," which term includes an individual, an individual and his/her spouse
and their children under the age of 21, or a trustee or other fiduciary
purchasing shares for a single trust, estate or fiduciary account although
more than one beneficiary is involved.
Class A Shares of the Fund are offered to the public at the net asset
value next computed after the purchase order is received by State Street Bank
and Trust Company, plus a maximum sales charge of 4.75% of the offering price
(4.99% of the amount invested) on single purchases of less than $50,000. The
sales charge is reduced on a graduated scale on single purchases of $50,000
or more as shown below.
Sales Charge Sales Charge Dealer Discount
Amount of as Percentage as Percentage or Agency Fee
Transaction of Offering of Amount as Percentage of
at Offering Price Price Invested Offering Price*
- --------------------- ------------- ------------- ------------------
Less than $50,000 4.75% 4.99% 4.25%
$50,000 but under
$100,000 4.50% 4.71% 4.00%
$100,000 but under
$250,000 3.50% 3.63% 3.00%
$250,000 but under
$500,000 3.00% 3.09% 2.75%
$500,000 but under
$1,000,000 2.00% 2.04% 1.75%
$1,000,000 or more None None None**
*Equity Planning will sponsor sales contests, training and educational
meetings and provide to all qualifying dealers, from its own profits and
resources, additional compensation in the form of trips, merchandise or
expense reimbursement. Brokers and dealers other than Equity Planning may
also make customary additional charges for their services in effecting
purchases, if they notify the Fund of their intention to do so. Equity
Planning shall also pay service and retention fees, from its own profits and
resources, to qualified wholesalers in connection with the sale of shares of
Phoenix Funds (exclusive of Class A Shares of Phoenix Money Market Series) by
registered financial institutions and related third party marketers.
**In connection with Class A Share purchases by an account held in the name
of a qualified employee benefit plan with at least 100 eligible employees,
Equity Planning may pay broker/dealers, from its own resources, an amount
equal to 1% on the first $3 million of purchases, 0.50% on the next $3
million, plus 0.25% on the amount in excess of $6 million.
In connection with Class A Share purchases of $1,000,000 or more (or
subsequent purchases in any amount), excluding purchases by qualified
employee benefit plans as described above, Equity Planning may pay
broker/dealers, from its own profits and resources, a percentage of the net
asset value of any shares sold as set forth below:
Purchase Amount Payment to Broker/Dealer
- --------------------------- ---------------------------
$1,000,000 to $3,000,000 1%
$3,000,001 to $6,000,000 0.50 of 1%
$6,000,001 or more 0.25 of 1%
If part or all of such investment, including investments by qualified
employee benefit plans, is subsequently redeemed within one year of the
investment date, the broker/dealer will refund to the Underwriter such
amounts paid with respect to the investment.
How To Obtain Reduced Sales Charges on Class A Shares
Investors choosing the initial sales charge alternative under certain
circumstances may be entitled to pay reduced sales charges. The circumstances
under which such investors may pay reduced sales charges are described below.
Qualified Purchasers. No sales charge will be imposed on sales of shares
to: (1) any Phoenix Fund trustee, director or officer; (2) any director or
officer, or to any full-time employee or sales representative (who has acted
as such for at least 90 days) of the Adviser or of Equity Planning; (3)
registered representatives and employees of securities dealers with whom
Equity Planning has sales agreements; (4) any qualified retirement plan
exclusively for persons described above; (5) any officer, director or
employee of a corporate affiliate of the Adviser or Equity Planning; (6) any
spouse, child, parent, grandparent, brother or sister of any person named in
(1), (2), (3) or (5) above; (7) employee benefit plans for employees of the
Adviser, Equity Planning and/or their corporate affiliates; (8) any employee
or agent who retires from Phoenix Home Life or Equity Planning; (9) any
account held in the name of a qualified employee benefit plan, endowment fund
or foundation if, on the date of initial investment, the plan, fund or
foundation has assets of $10,000,000 or more or at least 100 eligible
employees; (10) any person with a direct rollover transfer of shares from an
established Phoenix Fund qualified plan; (11) any Phoenix Home Life separate
account which funds group annuity contracts offered to qualified employee
benefit plans; (12) any state, county, city, instrumentality, department,
authority or agency prohibited by law from paying a sales charge; (13) any
fully matriculated student in a U.S. service academy; (14) any unallocated
accounts held by a third party administrator, registered investment adviser,
trust company, or bank trust department which exercises discretionary
authority and holds the account in a fiduciary, agency, custodial or similar
capacity if in the aggregate such accounts held by such entity equal or
exceed
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$1,000,000; (15) any person who is investing redemption proceeds from
investment companies other than the Phoenix Funds if, in connection with the
purchases or redemption of the redeemed shares, the investor paid a prior
sales charge provided such investor supplies verification that the redemption
occurred within 90 days of the Phoenix Fund purchase and that a sales charge
was paid: or (16) any accounts established by financial institutions,
broker/dealers or registered investment advisers that charge an account
management fee or transaction fee, provided such entity has entered into an
agreement with the Underwriter for this program; provided that sales made to
persons listed in (1) through (15) above are made upon the written assurance
of the purchaser that the purchase is made for investment purposes and that
the shares so acquired will not be resold except to the Fund.
Shares issued pursuant to the automatic reinvestment of income dividends
or capital gains distributions are not subject to any sales charges. The Fund
receives the entire net asset value of its Class A Shares sold to investors.
The Underwriter's commission is the sales charge shown above less any
applicable discount or commission "re-allowed" to selected dealers and
agents. The Underwriter will re-allow discounts to selected dealers and
agents in the amounts indicated in the table above. In this regard, the
Underwriter may elect to re- allow the entire sales charge to selected
dealers and agents for all sales with respect to which orders are placed with
the Underwriter. A selected dealer who receives re-allowance in excess of 90%
of such a sales charge may be deemed to be an "underwriter" under the
Securities Act of 1933.
Combination Purchase Privilege. Purchases, either singly or in any
combination, of shares of the Fund or shares of any other Phoenix Fund,
(including Class B Shares and excluding Money Market Fund Series Class A
Shares) if made at a single time by a single purchaser, will be combined for
the purpose of determining whether the total dollar amount of such purchases
entitles the purchaser to a reduced sales charge on any such purchases of
Class A Shares. Each purchase of Class A Shares will then be made at the
public offering price, as described in the then current Prospectus relating
to such shares, which at the time of such purchase is applicable to a single
transaction of the total dollar amount of all such purchases. The term
"single purchaser" includes an individual, or an individual, his spouse and
their children under the age of majority purchasing for his or their own
account (including an IRA account) including his or their own trust, commonly
known as a living trust; a trustee or other fiduciary purchasing for a single
trust, estate or single fiduciary account, although more than one beneficiary
is involved; multiple trusts or 403(b) plans for the same employer; multiple
accounts (up to 200) under a qualified employee benefit plan or administered
by a third party administrator; or trust companies, bank trust departments,
registered investment advisers, and similar entities placing orders or
providing administrative services with respect to funds over which they
exercise discretionary investment authority and which are held in a
fiduciary, agency, custodial or similar capacity, provided all shares are
held in record in the name, or nominee name, of the entity placing the order.
Letter of Intent. Class A Shares or shares of any other Phoenix Fund
(including Class B Shares and excluding Money Market Fund Series Class A
Shares) may be purchased by a "single purchaser" (as defined above) within a
period of thirteen months pursuant to a Letter of Intent, in the form
provided by Equity Planning, stating the investor's intention to invest in
such shares during such period an amount which, together with the value (at
their maximum offering prices on the date of the Letter) of the Class A
Shares of the Fund or Class A or Class B Shares of any other Phoenix Fund
then owned by such investor, equals a specified dollar amount. Each purchase
of shares made pursuant to a Letter of Intent will be made at the public
offering price, as described in the then current Prospectus relating to such
shares, which at the time of purchase is applicable to a single transaction
of the total dollar amount specified in the Letter of Intent.
An investor's Letter of Intent is not a binding commitment of the investor
to purchase or a binding obligation of the Fund or Equity Planning to sell a
specified dollar amount of shares qualifying for a reduced sales charge.
Accordingly, out of his initial purchase (and subsequent purchases if
necessary), 5% of the dollar amount of purchases required to complete his
investment (valued at the purchase price thereof) is held in escrow in the
form of shares registered in the investor's name until he completes his
investment, at which time escrowed shares are deposited to his account. If
the investor does not complete his investment and does not within 20 days
after written request by Equity Planning or his dealer pay the difference
between the sales charge on the dollar amount specified in his Letter of
Intent and the sales charge on the dollar amount of actual purchases, the
difference will be realized through the redemption of an appropriate number
of the escrowed shares and any remaining escrowed shares will be deposited to
his account.
Right of Accumulation. "Single purchasers" (as defined above) may also
qualify for reduced sales charges based on the combined value of purchases of
either class of shares of the Fund, or any other Phoenix Fund, made over
time. Reduced sales charges are offered to investors whose shares, in the
aggregate, are valued (i.e., the dollar amount of such purchases plus the
then current value (at the public offering price as described in the then
current prospectus relating to such shares) of shares of all Phoenix Funds
owned) in excess of the threshold amounts described in the section entitled
"Initial Sales Charge Alternative--Class A Shares." To use this option, the
investor must supply sufficient information as to account registrations and
account numbers to permit verification that one or more of his purchases
qualifies for a reduced sales charge.
Associations. A group or association may be treated as a "single
purchaser" and qualify for reduced initial sales charges under the
Combination Purchase Privilege and Right of Accumulation if the group or
association (1) has been in existence for at least six months; (2) has a
legitimate purpose other than to purchase mutual fund shares at a reduced
sales charge; (3) gives its endorsements or authorization to the investment
program to facilitate solicitation of the membership by the investment
dealer, thus effecting economies of sales effort; and (4) is not a group
whose sole organizational nexus is that the members are credit card holders
of a company, policyholders of an insurance company, customers of a bank or a
broker-dealer or clients of an investment adviser.
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Deferred Sales Charge Alternative--Class B Shares
Investors choosing the deferred sales charge alternative purchase Class B
Shares at net asset value per share without the imposition of a sales charge
at the time of purchase. The Class B Shares are being sold without an initial
sales charge, but are subject to a sales charge if redeemed within five years
of purchase.
Proceeds from the contingent deferred sales charge are paid to the
Underwriter and are used in whole or in part by the Underwriter to defray the
expenses of the Underwriter related to providing distribution-related
services to the Fund in connection with the sale of the Class B Shares, such
as the payment of compensation to selected dealers and agents for selling
Class B Shares. The combination of the contingent deferred sales charge and
the distribution fee facilitates the ability of the Fund to sell the Class B
Shares without a sales charge being deducted at the time of purchase.
Contingent Deferred Sales Charge. Class B Shares which are redeemed within
five years of purchase will be subject to a contingent deferred sales charge
at the rates set forth below charged as a percentage of the dollar amount
subject thereto. The charge will be assessed on an amount equal to the lesser
of the current market value or the cost of the shares being redeemed.
Accordingly, no sales charge will be imposed on increases in net asset value
above the initial purchase price. In addition, no charge will be assessed on
shares derived from reinvestment of dividends or capital gains distributions.
The Underwriter intends to pay investment dealers a sales commission of 4%
of the sale price of Class B Shares sold by such dealers, subject to future
amendment or termination. The Underwriter will retain all or a portion of the
continuing distribution fee assessed to Class B shareholders and will receive
the entire amount of the contingent deferred sales charge paid by
shareholders on the redemption of shares to finance the 4% commission plus
interest and related marketing expenses.
The amount of the contingent deferred sales charges, if any, will vary
depending on the number of years from the time of payment for the purchase of
Class B Shares until the time of redemption of such shares. Solely for
purposes of determining the number of years from the time of any payment for
the purchases of shares, all payments during a month will be aggregated and
deemed to have been made on the last day of the previous month.
Contingent Deferred
Sales Charge as
a Percentage of
Dollar Amount
Year Since Purchase Subject to Charge
- ---------------------- ---------------------
First 5%
Second 4%
Third 3%
Fourth 2%
Fifth 2%
Sixth 0%
In determining whether a contingent deferred sales charge is applicable to
a redemption, it will be assumed that any Class A Shares are being redeemed
first, Class B Shares held for over five-years and shares acquired pursuant
to reinvestment of dividends or distributions are redeemed next. Any Class B
Shares held longest during the five-year period are redeemed next unless the
shareholder directs otherwise. The charge will not be applied to dollar
amounts representing an increase in the net asset value since the time of
purchase.
To provide an example, assume in 1990, an investor purchased 100 Class B
Shares. In 1993, the investor purchased another 100 Class B Shares at $12 per
share. In 1995, the investor purchased 100 Class A Shares. Assume that in
1996, the investor owns 225 Class B Shares (15 Class B Shares resulting from
dividend reinvestment and distributions upon the Class B Shares purchased in
1990 and 10 Class B Shares resulting from dividend reinvestment and
distributions upon the Class B Shares purchased in 1993) as well as 100 Class
A Shares. If the investor wished to then redeem 300 shares and had not
specified a preference in redeeming shares: first, 100 Class A Shares would
be redeemed without charge. Second, 115 Class B Shares purchased in 1990
(including 15 shares issued as a result of dividend reinvestment and
distributions) would be redeemed next without charge. Finally, 85 Class B
Shares purchased in 1993 would be redeemed resulting in a deferred sales
charge of $27 [75 shares (85 shares minus 10 shares resulting from dividend
reinvestment) x $12 (original price or current NAV if less than original) x
3% (applicable rate in the third year after purchase)].
The contingent deferred sales charge is waived on redemptions of shares
(a) if redemption is made within one year of death (i) of the sole
shareholder on an individual account, (ii) of a joint tenant where the
surviving joint tenant is the deceased's spouse, or (iii) of the beneficiary
of a Uniform Gifts to Minors Act (UGMA), Uniform Transfers to Minors Act
(UTMA) or other custodial account; (b) if redemption is made within one year
of disability, as defined in Section 72(m)(7) of the Code; (c) in connection
with mandatory distributions upon reaching age 70-1/2 under any retirement
plan qualified under Sections 401, 408 or 403(b) of the Code or any
redemption resulting from the tax-free return of an excess contribution to an
IRA; (d) in connection with redemptions by 401(k) plans using an approved
participant tracking system for: participant hardships, death, disability or
normal retirement, and loans which are subsequently repaid; (e) in connection
with the exercise of certain exchange privileges among Class B Shares of the
Fund and Class B Shares of other Phoenix Funds; (f) in connection with any
direct rollover transfer of shares from an established Phoenix Fund qualified
plan into a Phoenix Fund IRA by participants terminating from the qualifying
plan; and (g) in accordance with the terms specified under the Systematic
Withdrawal Program. If, upon the occurrence of a death as outlined above, the
account is transferred to an account registered in the name of the deceased's
estate, the contingent deferred sales charge will be waived on any redemption
from the estate account occurring within one year of the death. If the Class
B Shares are not redeemed within one year of the death, they will remain
Class B Shares and be subject to the applicable contingent deferred sales
charge when redeemed.
Class B Shares of the Fund will automatically convert to Class A Shares
without a sales charge at the relative net asset values
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<PAGE>
of each of the classes after eight years from the acquisition of the Class B
Shares, and as a result, will thereafter be subject to the lower distribution
fee under the Class A Plan.
Such conversion will be on the basis of the relative net asset value of
the two classes without the imposition of any sales load, fee or other
charge. The purpose of the conversion feature is to relieve the holders of
Class B Shares that have been outstanding for a period of time sufficient for
the National Distributor to have been compensated for distribution-related
expenses.
For purposes of conversion to Class A Shares purchased through the
reinvestment of dividends and distributions paid in respect of Class B Shares
in a shareholder's Fund account will be considered to be held in a separate
sub-account. Each time any Class B Shares in the shareholder's Fund account
(other than those in the sub-account) are converted to Class A Shares, an
equal pro rata portion of the Class B Shares in the sub-account will also be
converted to Class A Shares.
The conversion of Class B Shares to Class A Shares is subject to the
availability of an opinion of counsel or a ruling of the Internal Revenue
Service ("IRS") to the effect that (i) the assessment of the higher
distribution fees and transfer agency costs with respect to Class B Shares
does not result in any dividends or distributions constituting "preferential
dividends" under the Code, and (ii) that the conversion of shares does not
constitute a taxable event under federal income tax law. The Fund has not
sought opinions of counsel as to these matters but has or shall apply to the
IRS for such a ruling. While a ruling similar to the one sought by the Fund
as to preferential dividends has been issued previously by the IRS with
respect to Phoenix Multi- Sector Fixed Income Fund, Inc., complete assurance
cannot be given when or whether the Fund will receive a favorable ruling.
While an adverse determination by the IRS is not expected, the Fund may be
required to reassess the alternative purchase arrangement structure if the
IRS does not rule favorably. In addition, were the IRS not to rule favorably,
the Fund might make additional distributions if doing so would assist in
complying with the Fund's general practice of distributing sufficient income
to reduce or eliminate U.S. federal taxes. The conversion of Class B Shares
to Class A Shares may be suspended if such an opinion or ruling is not
available. In that event, no further conversions of Class B Shares would
occur, and shares might continue to be subject to the higher distribution fee
for an indefinite period which may extend beyond the period ending six years
after the end of the month in which affected Class B Shares were purchased.
INVESTOR ACCOUNTS
AND SERVICES AVAILABLE
An account will be opened for the investor after the investor makes an
initial investment. Shares purchased will be held in the shareholder's
account by the Transfer Agent which will forward a statement each time there
is a change in the number of shares in the account. At any time, a
shareholder may request that a certificate be issued, subject to certain
conditions, representing any number of full shares held in his or her
account.
The Fund mails periodic reports to its shareholders. In order to reduce the
volume of mail, to the extent possible, only one copy of most Fund reports
will be mailed to households for multiple accounts with the same surname at
the same household address. Please contact Equity Planning to request
additional copies of shareholder reports.
Shareholder inquiries should be directed to the Fund at (800) 243-1574.
Bank Draft Investing Program (Investo-Matic Plan)
By completing the Investo-Matic Section of the New Account Application, a
shareholder may authorize the bank named in the form to draw $25 or more from
his/her personal checking account on or about the 15th day of the month, to
be used to purchase additional shares for his account. The amount the
shareholder designates will be made available, in form payable to the order
of the Transfer Agent by the bank on the date the bank draws on his/her
account and will be used to purchase shares at the applicable offering price.
The shareholder or his or her registered representative may, by telephone or
written notice, cancel or change the dollar amount being invested pursuant to
the Investo-Matic Plan unless the shareholder has notified the Fund or
Transfer Agent that his or her registered representative shall not have this
authority.
Distribution Option
The Fund currently declares all income dividends and all capital gain
distributions, if any, payable in shares of the Fund at net asset value or,
at the option of the shareholder, in cash. By exercising the distribution
option, a shareholder may elect to: (1) receive both dividends and capital
gain distributions in additional shares; or (2) receive dividends in cash and
capital gain distributions in additional shares; or (3) receive both
dividends and capital gain distributions in cash. If a shareholder elects to
receive dividends and/or distributions in cash and the check cannot be
delivered or remains uncashed by the shareholder due to an invalid address,
then the dividend and/or distribution will be reinvested after the Transfer
Agent has been informed that the proceeds are undeliverable. Additional
shares will be purchased for the shareholder's account at the then current
net asset value. Shareholders who maintain an account balance of at least
$5,000, or $2,000 for tax qualified retirement benefit plans (calculated on
the basis of the net asset value of the shares held in a single account), may
direct that any dividends and distributions paid with respect to shares in
that account be automatically reinvested in a single account of one of the
other Phoenix Funds at net asset value. Shareholders should obtain a current
prospectus and consider the objectives and policies of each such Fund
carefully before directing dividends and distributions to the other Fund.
Reinvestment election forms and prospectuses are available from Equity
Planning. Distributions may also be mailed to a second payee and/or address.
Dividends and capital gain distributions received in shares are taxable to
the shareholder and credited to the shareholder's account in full and
fractional shares and are computed at the closing net asset value on the next
business day after the record date. A distribution option may be changed at
any time by notifying Customer Service by telephone at (800) 243-1574 or
sending a letter signed by the registered owner(s) of the account. Requests
for directing distributions to an alternate payee must be
15
<PAGE>
made in writing with a signature guarantee of the registered owner(s). To be
effective with respect to a particular dividend or distribution, notification
of the new distribution option must be received by the Transfer Agent at
least three days prior to the record date of such dividend or distribution.
If all shares in the shareholder's account are repurchased or redeemed or
transferred between the record date and the payment date of a dividend or
distribution, he/she will receive cash for the dividend or distribution
regardless of the distribution option selected.
Systematic Withdrawal Program
The Systematic Withdrawal Program allows shareholders to periodically redeem
a portion of their account on a predetermined monthly or quarterly,
semiannual or annual basis. A sufficient number of full and fractional shares
shall therefore be redeemed so that the designated payment is made on or
about the 20th day of the month. Shares are tendered for redemption by the
Transfer Agent, as agent for the shareowner, on or about the 15th of the
month at the closing net asset value on the date of redemption. The
Systematic Withdrawal Program also provides for redemptions to be tendered on
or about the 10th, 15th or 25th of the month with proceeds to be directed
through Automated Clearing House (ACH) to the shareholder's bank account. In
addition to the limitations stated below, withdrawals may not be less than
$25 and minimum account balance requirements shall continue to apply. See
"Redemption of Small Accounts".
Class A shareholders participating in the Systematic Withdrawal Program
must own shares of the Fund worth $5,000 or more, as determined by the
then-current net asset value per share. The purchase of shares while
participating in the withdrawal program will ordinarily be disadvantageous to
the Class A Shares investor since a sales charge will be paid by the investor
on the purchase of Class A Shares at the same time as other shares are being
redeemed. For this reason, investors in Class A Shares may not participate in
an automatic investment program while participating in the Systematic
Withdrawal Program.
To participate in the Systematic Withdrawal Program, Class B shareholders
must initially own shares of the Fund worth $5,000 or more and elect to have
all dividends reinvested in additional Class B Shares of the Fund. Through
the Program, Class B shareholders may withdraw up to 1% of their aggregate
net investments (purchases, at initial value, to date net of non- Program
redemptions) each month or up to 3% of their aggregate net investments each
quarter without incurring otherwise applicable contingent deferred sales
charges.
Class B shareholders redeeming more shares than the percentage permitted
by the withdrawal program shall be subject to any applicable contingent
deferred sales charge. Accordingly, the purchase of Class B Shares will
generally not be suitable for an investor who anticipates withdrawing sums in
excess of the above limits shortly after purchase.
Tax-Sheltered Retirement Plans
Shares of the Fund are offered in connection with the following qualified
prototype retirement plans: IRA, Rollover IRA, SEP-IRA, Profit-Sharing and
Money Purchase Pension Plans which can be adopted by self-employed persons
("Keogh") and by corporations, and 403(b) Retirement Plans. Write or call
Equity Planning (800) 243-4361 for further information about the plans.
Exchange Privileges
Shareholders may exchange Class A or Class B Shares held in book-entry form
for shares of the same class of other Phoenix Funds, (except Phoenix Asset
Reserve Class A Shares held less than 6 months and Class A Shares of Phoenix
Money Market Series), provided the following conditions are met: (1) the
shares that will be acquired in the exchange (the "Acquired Shares") are
available for sale in the shareholder's state of residence; (2) the Acquired
Shares are the same class as the shares to be surrendered (the "Exchanged
Shares"); (3) the Acquired Shares will be registered to the same shareholder
account as the Exchanged Shares; (4) the account value of the Fund whose
shares are to be acquired must equal or exceed the minimum initial investment
amount required by that Fund after the exchange is implemented; and (5) if a
shareholder has elected not to utilize the Telephone Exchange Privilege (see
below), a properly executed exchange request must be received by State Street
Bank and Trust Company. Exchange privileges are not available for certain
shareholders holding Class A Shares of Phoenix Money Market Fund Series and
Class A Shares of the Phoenix Asset Reserve held for less than 6 months.
Subject to the above requirements for an exchange, a shareholder or
his/her registered representative may, by telephone or written notice, elect
to have Class A or Class B Shares of the Fund exchanged for the same class of
shares of another Phoenix Fund automatically on a monthly, quarterly,
semi-annual or annual basis or may cancel the privilege ("Systematic
Exchange").
Shareholders who maintain an account balance in the Fund of at least
$5,000, or $2,000 for tax qualified retirement benefit plans (calculated on
the basis of the net asset value of the shares held in a single account), may
direct that shares of the Fund be automatically exchanged at predetermined
intervals for shares of the same class of another Phoenix Fund. If the
shareholder is participating in the Self Security program offered by Phoenix
Home Life, it is not necessary to maintain the above account balances in
order to use the Systematic Exchange privilege.
Such exchanges will be executed upon the close of business on the 10th of
a month and if the 10th falls on a holiday or weekend, then at the close of
business on the next succeeding business day. The minimum initial and
subsequent amount that may be exchanged under the Systematic Exchange is $25.
Systematic Exchange forms are available from Equity Planning.
Exchanges will be based upon each Fund's net asset value per share next
computed following receipt of a properly executed exchange request, without
sales charge. On Class B Share exchanges, the contingent deferred sales
charge schedule of the original shares purchased continues to apply.
The exchange of shares from one fund to another is treated as a sale of
the Exchanged Shares and a purchase of the Acquired Shares for Federal income
tax purposes. The shareholder may,
16
<PAGE>
therefore, realize a taxable gain or loss. See "Dividends, Distributions and
Taxes" for information concerning the Federal income tax treatment of the
disposition of shares.
It is the policy of the Fund to discourage and prevent frequent trading by
shareholders among the Fund and other Phoenix Funds in response to market
fluctuations. The Fund reserves the right to refuse exchange purchases by any
person or broker/dealer if, in the Fund's or Adviser's opinion, the exchange
would adversely affect the Fund's ability to invest according to its
investment objectives and policies, or otherwise adversely affect the Fund
and its shareholders. The Fund reserves the right to terminate or modify its
exchange privileges at any time upon giving prominent notice to shareholders
at least 60 days in advance.
Each Phoenix Fund has different investment objectives and policies.
Shareholders should, therefore, obtain and review the prospectus of the fund
into which the exchange is to be made before any exchange requests are made.
Telephone Exchanges
Telephone Exchange privileges are only available in states where the shares
to be acquired may be legally sold. (See the Statement of Additional
Information.) Unless a shareholder elects in writing not to participate in
the Telephone Exchange Privilege, shares for which certificates have not been
issued may be exchanged by calling (800) 367-5877 provided that the exchange
is made between accounts with identical registrations. Under the Telephone
Exchange Privilege, telephone exchange orders may also be entered on behalf
of the shareholder by his or her legal representative.
The Fund and the Transfer Agent will employ reasonable procedures to
confirm that telephone instructions are genuine. In addition to requiring
identical registrations on both accounts, the Transfer Agent will require
address verification and will record telephone instructions on tape. All
exchanges will be confirmed in writing with the shareholder. To the extent
that procedures reasonably designed to prevent unauthorized telephone
exchanges are not followed, the Fund and/or the Transfer Agent may be liable
for following telephone instructions for exchange transactions that prove to
be fraudulent. Broker/dealers other than Equity Planning have agreed to bear
the risk of any loss resulting from any unauthorized telephone exchange
instructions from the firm or its registered representatives. However, the
shareholder would bear the risk of loss resulting from instructions entered
by an unauthorized third party that the Fund and/or the Transfer Agent
reasonably believe to be genuine. The Telephone Exchange Privilege may be
modified or terminated at any time on 60 days' notice to shareholders. In
addition, during times of drastic economic or market changes, the Telephone
Exchange Privilege may be difficult to exercise or may be suspended
temporarily. In such event an exchange may be effected by following the
procedure outlined for tendering shares represented by certificate(s).
If a shareholder elects not to use the Telephone Exchange Privilege or if
the shares being exchanged are represented by a certificate or certificates,
in order to exchange shares the shareholder must submit a written request to
Phoenix Funds, c/o State Street Bank and Trust Company, P.O. Box 8301,
Boston, MA 02266-8301. If the shares are being exchanged between accounts
that are not registered identically, the signature on such request must be
guaranteed by an eligible guarantor institution as defined by the Fund's
transfer agent in accordance with its signature guarantee procedures.
Currently such procedures generally permit guarantees by banks,
broker/dealers, credit unions, national securities exchanges, registered
securities associations, clearing agencies and savings associations. Any
outstanding certificate or certificates for the tendered shares must be duly
endorsed and submitted.
Purchase and withdrawal plans and reinvestment and exchange privileges are
described more fully in the Statement of Additional Information. For further
information, call Equity Planning at (800) 243-1574.
NET ASSET VALUE
The net asset value per share of each class of shares of the Fund is
determined as of the close of regular trading of the New York Stock Exchange
(the "Exchange") on days when the Exchange is open.
The net asset value per share of the Fund is computed by dividing the value
of the Fund's securities, plus any cash and other assets less all liabilities
(including accrued expenses) by the number of shares of the Fund outstanding.
The total liability allocated to a class, plus that class' distribution fee
and any other expenses specifically allocated to that class, are deducted
from the proportionate interest of such class in the Fund's assets, and the
resulting amount for each class is divided by the number of shares of that
class to produce the net asset value per share. A security listed or traded
on an exchange is valued at its last sale price on the exchange where it is
principally traded. Lacking any sales on the exchange where it is principally
traded on the day of valuation prior to the time as of which assets are
valued, the security is valued at the last bid price on that exchange. Short-
term investments having a remaining maturity of less than sixty days are
valued at amortized cost when the Board of Trustees has determined that
amortized cost would equal fair market value. All other securities for which
over-the-counter market quotations are readily available are valued at the
last bid price. Other assets are valued at fair value as determined in good
faith by the Trustees of the Fund.
Generally, trading in foreign securities, as well as trading in corporate
bonds, U.S. Government securities and money market instruments is
substantially completed each day at various times prior to the close of the
general trading session of the Exchange. The values of such securities used
in computing the net asset value of the Fund are determined as of such times.
Occasionally, events affecting the value of such securities may occur between
such times and the close of the general trading session which will not be
reflected in the computation of the Fund's net asset value. If events occur
which materially affect the value of such securities, the securities will be
valued at fair market value as determined in good faith by the Trustees.
17
<PAGE>
HOW TO REDEEM SHARES
Shareholders have the right to have the Fund buy back shares at the net
asset value next determined after receipt of a redemption request and any
other required documentation in proper form (see "Net Asset Value"). In the
case of Class B Share redemptions, investors will be subject to the
applicable deferred sales charge, if any, for such shares (see "Deferred
Sales Charge Alternative--Class B Shares", above). To redeem, any outstanding
share certificates in proper form for transfer must be received by Phoenix
Funds, c/o State Street Bank and Trust Company, P.O. Box 8301, Boston, MA
02266-8301. To be in proper form to redeem shares, the signature of the
shareholder(s) on the certificate or stock power must be signed exactly as
registered, including any fiduciary title, on a written instruction letter,
certificate, or accompanying stock power, such signatures being guaranteed by
an eligible guarantor institution as determined in accordance with the
standards and procedures established by the Transfer Agent (please contact
the Fund at (800) 243-1574 with any questions regarding eligible guarantors).
If no certificate has been issued, the Transfer Agent requires a written
request with signature guarantee. The Transfer Agent may waive the signature
guarantee requirement in the case of shares registered in the names of
individuals singly, jointly, or as custodian under the Uniform Gifts to
Minors Act, if the proceeds do not exceed $50,000, and the proceeds are
payable to the registered owner(s) at the address of record. Such requests
must be signed by each person in whose name the account is registered. In
addition, a shareholder may sell shares back to the Fund through securities
dealers who may charge customary commissions for their services. The
redemption price in such case will be the price as of the close of the
general trading session of the New York Stock Exchange (currently 4:00 p.m.
Eastern Time) on that day, provided the order is received by the dealer prior
thereto, and is transmitted to the Underwriter prior to the close of its
business. No charge is made by the Fund on redemptions, but shares tendered
through investment dealers may be subject to a service charge by such
dealers. Payment for shares redeemed is made within seven days; provided,
however, that redemption proceeds will not be disbursed until each check used
for purchase of shares has been cleared for payment by the investor's bank,
which may take up to 15 days after receipt of the check.
Additional documentation may be required for redemptions by corporations,
partnership or other organizations, executors, administrators, trustees,
custodians, guardians, or from IRAs or other retirement plans, or if
redemption is requested by anyone but the shareholder(s) of record. To avoid
delay in redemption or transfer, shareholders having questions about specific
requirements should contact the Fund at (800) 243-1574. Redemption requests
will not be honored until all required documents in proper form have been
received.
Telephone Redemptions
Unless a shareholder elects in writing not to participate in the Telephone
Redemption privilege, shares for which certificates have not been issued may
be redeemed by telephoning (800) 367-5877 and telephone redemptions will also
be accepted on behalf of the shareholder from his or her registered
representative.
The Fund and the Transfer Agent will employ reasonable procedures to
confirm that telephone instructions are genuine. Address and bank account
information will be verified, the telephone redemption instructions will be
recorded on tape, and all redemptions will be confirmed in writing to the
shareholder. If there has been an address change within the past 60 days, a
telephone redemption will not be authorized. To the extent that procedures
reasonably designed to prevent unauthorized telephone redemptions are not
followed, the Fund and/or the Transfer Agent may be liable for following
telephone instructions for redemption transactions that prove to be
fraudulent. Broker/ dealers other than Equity Planning have agreed to bear
the risk of any loss resulting from any unauthorized telephone redemption
instruction from the firm or its registered representatives. However, the
shareholder would bear the risk of loss resulting from instructions entered
by an unauthorized third party that the Fund and/or the Transfer Agent
reasonably believe to be genuine. The Telephone Redemption Privilege may be
modified or terminated at any time on 60 days' notice to shareholders. In
addition, during times of drastic economic or market changes, the Telephone
Redemption Privilege may be difficult to exercise and a shareholder should
submit a written redemption request, as described above.
If the amount of the redemption is over $500, the proceeds will be wired
to the shareholder's designated U.S. commercial bank account. If the amount
of the redemption is less than $500, the proceeds will be sent by check to
the address of record on the shareholder's account.
Telephone redemption requests must be received by the Transfer Agent by
the close of trading on the New York Stock Exchange on any day when the
Transfer Agent is open for business. Requests made after that time or on a
day when the Transfer Agent is not open for business cannot be accepted by
the Transfer Agent. The proceeds of a telephone redemption will normally be
sent on the first business day following receipt of the redemption request.
However, with respect to the telephone redemption of shares purchased by
check, such requests will only be effected after the Fund has assured itself
that good payment has been collected for the purchase of shares, which may
take up to 15 days. This expedited redemption privilege is not available to
HR-10, IRA and 403(b)(7) Plans.
Reinvestment Privilege
Shareholders have the privilege of using redemption proceeds to purchase
Class A Shares of any Phoenix Fund with no sales charge (at the net asset
value next determined after the request for reinvestment is made). For
Federal income tax purposes, a redemption and reinvestment will be treated as
a sale and purchase of shares. Special rules may apply in computing the
amount of gain or loss in these situations. (See "Dividends, Distributions
and Taxes" for information on the Federal income tax treatment of a
disposition of shares.) A written request for reinvestment must be received
by the Underwriter within 180 days of the redemption, accompanied by payment
for the shares
18
<PAGE>
(not in excess of the redemption value). Class B shareholders who have had
the contingent deferred sales charge waived through participation in the
Systematic Withdrawal Program are not eligible to use the Reinvestment
Privilege.
Redemption of Small Accounts
Due to the relatively high cost of maintaining small accounts, the Fund
reserves the right to redeem, at net asset value, the shares of any
shareholder whose account has a value, due to redemptions, of less than $200.
Before the Fund redeems these shares, the shareholder will be given notice
that the value of the shares in the account is less than the minimum amount
and will be allowed 30 days to make an additional investment in an amount
which will increase the value of the account to at least $200.
A shareholder should contact his/her broker/dealer if he/she wishes to
transfer shares from an existing broker/dealer street name account to a
street name account with another broker/ dealer. The Fund has no specific
procedures governing such account transfers.
DIVIDENDS, DISTRIBUTIONS
AND TAXES
The Fund intends to continue to qualify annually as a regulated investment
company under Subchapter M of the Code and to distribute annually to
shareholders all or substantially all of its net investment income and net
realized capital gains, after utilization of any capital loss carryovers. If
the Fund so qualifies, it generally will not be subject to Federal income tax
on the income it distributes. The discussion below is based on the assumption
that the Fund will continue to qualify as a regulated investment company.
The Fund intends to make distributions from net investment income
semi-annually, and intends to distribute net realized capital gain, if any,
at least annually.
The Fund will be subject to a nondeductible 4% excise tax if it fails to
meet certain annual distribution requirements. In order to prevent imposition
of the excise tax, it may be necessary for the Fund to make distributions
more frequently than described in the previous paragraph.
Unless a shareholder elects to receive distributions in cash, dividends and
capital gain distributions will be paid in additional shares of the Fund
credited at the net asset value per share on the ex-date. Dividends and
distributions, whether received in cash or in additional shares of the Fund,
generally are subject to Federal income tax and may be subject to state,
local and other taxes. Shareholders will be notified annually about the
amount and character of distributions made to them by the Fund.
Long-term capital gains, if any, distributed to shareholders and which are
designated by the Fund as capital gain distributions, are taxable to
shareholders as long-term capital gain distributions regardless of the length
of time shares of the Fund have been held by the shareholder. Distributions
of short-term capital gains and net investment income, if any, are taxable to
shareholders as ordinary income.
Dividends and distributions generally will be taxable to shareholders in the
taxable year in which they are received. However, dividends and distributions
declared by the Fund in October, November or December of any calendar year,
with a record date in such a month, and paid during the following January
will be treated as if they were paid by the Fund and received by shareholders
on December 31 of the calendar year in which they were declared.
A redemption or other disposition (including an exchange) of shares of the
Fund generally will result in the recognition of a taxable gain or loss,
which will be a long- or short-term capital gain or loss (assuming the shares
were a capital asset in the hands of the shareholder), depending upon the
shareholder's holding period for his or her shares. A capital loss realized
on a disposition of Fund shares held six months or less will be treated as a
long-term capital loss to the extent of capital gain distributions received
with respect to such shares. In addition, if shares of the Fund are disposed
of at a loss and are replaced (either through purchases or through
reinvestment of dividends) within a period commencing thirty days before and
ending thirty days after the disposition of such shares, the realized loss
will be disallowed and appropriate adjustments to the tax basis of the new
shares will be made.
Investment income received by the Fund from sources within foreign countries
may be subject to foreign income taxes withheld at the source. If the Fund
should have more than 50% of the value of its assets invested in securities
of foreign corporations at the close of its taxable year, which is the Fund's
present intention, the Fund may elect to permit its shareholders to take,
either as a credit or a deduction, their proportionate share of the foreign
income taxes paid.
The conversion of Class B Shares to Class A Shares is subject to the
continuing availability of an opinion of counsel or a ruling of the Internal
Revenue Service ("IRS") to the effect that (i) the assessment of the higher
distribution fees and transfer agency costs with respect to Class B Shares
does not result in any dividends or distributions constituting "preferential
dividends" under the Code, and (ii) that the conversion of shares does not
constitute a taxable event under federal income tax law. The Fund has not
sought opinions of counsel as to these matters but has or shall apply to the
IRS for such a ruling. While a ruling similar to the one sought by the Fund
as to preferential dividends has been issued previously by the IRS with
respect to Phoenix Multi- Sector Fixed Income Fund, Inc., complete assurance
cannot be given when or whether the Fund will receive a favorable ruling.
While an adverse determination by the IRS is not expected, the Fund may be
required to reassess the alternative purchase arrangement structure if the
IRS does not rule favorably. In addition, were the IRS not to rule favorably,
the Fund might make additional distributions if doing so would assist in
complying with the Fund's general practice of distributing sufficient income
to reduce or eliminate U.S. federal taxes. The conversion of Class B Shares
to Class A Shares may be suspended if such an opinion or ruling is no longer
available. In that event, no further conversions of Class B Shares would
occur, and shares might
19
<PAGE>
continue to be subject to the higher distribution fee for an indefinite
period which may extend beyond the period ending six years after the end of
the month in which affected Class B Shares were purchased.
Investors are urged to consult their attorney or tax adviser regarding
specific questions as to Federal, foreign, state or local taxes.
Important Notice Regarding Taxpayer IRS Certification
Pursuant to IRS regulations, the Fund may be required to withhold 31% of all
reportable payments including any taxable dividends, capital gain
distributions or share redemption proceeds, for any account which does not
have a taxpayer identification number or social security number and certain
required certifications.
The Fund reserves the right to refuse to open an account for any person
failing to provide a taxpayer identification number along with the required
certifications.
The Fund sends to all shareholders, within 31 days after the end of the
calendar year, information which is required by the Internal Revenue Service
for preparing Federal income tax returns. Investors are urged to consult
their attorney or tax adviser regarding specific questions as to Federal,
foreign, state or local taxes.
ADDITIONAL INFORMATION
Organization of the Fund
The Fund was initially incorporated as Fairfield Fund, Inc. in New York in
1956 and has operated as an open-end, diversified management investment
company since May of 1960. On December 14, 1990, the name of the Fund was
changed to National Worldwide Opportunities Fund, Inc. in connection with
certain changes adopted in various investment policies and restrictions,
which enabled the Fund to take advantage of investment opportunities outside
of the United States in pursuit of its investment objective of capital
appreciation.
On January 13, 1992 the shareholders of the Fund approved a reorganization
whereby the Fund converted from a New York corporation to a Massachusetts
Business Trust. In connection therewith, the shareholders approved the
adoption of new management and advisory agreements and a distribution plan
which are in substance identical to those which were in existence for the
Fund. At the effective time of the reorganization (January 15, 1992), the
Fund's name changed to National Worldwide Opportunities Fund. On June 30,
1993, the Trustees voted to change the name of the Fund to "Phoenix Worldwide
Opportunities Fund" to reflect the purchase of the Adviser by Phoenix Home
Life and the affiliation with other Phoenix Funds.
The Declaration of Trust provides that the Trustees are authorized to
create an unlimited number of series and, with respect to each series, to
issue an unlimited number of full and fractional shares of beneficial
interest of one or more classes and to divide or combine the shares into a
greater or lesser number of shares without thereby changing the proportionate
beneficial interests in the series. All shares have equal voting rights,
except that only shares of the respective series or separate classes within a
series are entitled to vote on matters concerning only that series or class.
At the date of this Prospectus, there is only one existing series of the
Fund, which has two classes of shares.
The shares of the Fund, when issued, will be fully paid and
non-assessable, have no preference, preemptive, or similar rights, and will
be freely transferable. There will normally be no meetings of shareholders
for the purpose of electing Trustees unless and until such time as less than
a majority of the Trustees holding office have been elected by shareholders,
at which time the Trustees then in office will call a shareholders' meeting
for the election of Trustees. Shareholders may, in accordance with the
Declaration of Trust, as amended, cause a meeting of shareholders to be held
for the purpose of voting on the removal of Trustees. Meetings of the
shareholders may be called upon written request of shareholders holding in
the aggregate not less than 10% of the outstanding shares having voting
rights. Except as set forth above and subject to the 1940 Act, the Trustees
will continue to hold office and appoint successor Trustees. Shares do not
have cumulative voting rights and the holders of more than 50% of the shares
of the Fund voting for the election of Trustees can elect all of the Trustees
of the Trust if they choose to do so and in such event the holders of the
remaining shares would not be able to elect any Trustees. Shareholders are
entitled to redeem their shares as set forth under "How to Redeem Shares".
The Declaration of Trust establishing the Fund (a copy of which, together
with all amendments thereto, is on file in the office of the Secretary of the
Commonwealth of Massachusetts), provides that the Fund's name refers to the
Trustees under the Declaration of Trust collectively as Trustees, but not as
individuals or personally; and no Trustee, shareholder, officer, employee or
agent of the Fund shall be held to any personal liability, nor shall resort
be had to their private property for the satisfaction of any obligation or
claim of said Fund, but the "Trust Property" only shall be liable.
Registration Statement
This Prospectus omits certain information included in the Statement of
Additional Information and Part C of the Registration Statement filed with
the Securities and Exchange Commission under the Securities Act of 1933 and
the 1940 Act. A copy of the Registration Statement may be obtained from the
Securities and Exchange Commission in Washington, D.C.
20
<PAGE>
BACKUP WITHHOLDING INFORMATION
Step 1. Please make sure that the social security number or taxpayer
identification number (TIN) which appears on the Application complies
with the following guidelines:
<TABLE>
<CAPTION>
Account Type Give Social Security Number or Tax Identification Number of:
<S> <C>
Individual Individual
Joint (or Joint Tenant) Owner who will be paying tax
Uniform Gifts to Minors Minor
Legal Guardian Ward, Minor or Incompetent
Sole Proprietor Owner of Business (also provide owner's name)
Trust, Estate, Pension Plan Trust Trust, Estate, Pension Plan Trust (not personal TIN of fiduciary)
Corporation, Partnership,
Other Organization Corporation, Partnership, Other Organization
Broker/Nominee Broker/Nominee
</TABLE>
Step 2. If you do not have a TIN, you must obtain Form SS-5 (Application for
Social Security Number) or Form SS-4 (Application for Employer
Identification Number) from your local Social Security or IRS office
and apply for one. Write "Applied For" in the space on the
application.
Step 3. If you are one of the entities listed below, you are exempt from
backup withholding.
(bullet) A corporation
(bullet) Financial institution
(bullet) Section 501(a) exempt organization (IRA, Corporate
Retirement Plan, 403(b), Keogh)
(bullet) United States or any agency or instrumentality thereof
(bullet) A State, the District of Columbia, a possession of the
United States, or any subdivision or instrumentality thereof
(bullet) International organization or any agency or instrumentality
thereof
(bullet) Registered dealer in securities or commodities registered in
the U.S. or a possession of the U.S.
(bullet) Real estate investment trust
(bullet) Common trust fund operated by a bank under section 584(a)
(bullet) An exempt charitable remainder trust, or a non-exempt trust
described in section 4947(a)(1)
(bullet) Regulated Investment Company
If you are in doubt as to whether you are exempt, please contact the Internal
Revenue Service.
Step 4. IRS Penalties--If you do not supply us with your TIN, you will be
subject to an IRS $50 penalty unless your failure is due to
reasonable cause and not willful neglect. If you fail to report
interest, dividend or patronage dividend income on your federal
income tax return, you will be treated as negligent and subject to an
IRS 5% penalty tax on any resulting underpayment of tax unless there
is clear and convincing evidence to the contrary. If you falsify
information on this form or make any other false statement resulting
in no backup withholding on an account which should be subject to a
backup withholding, you may be subject to an IRS $500 penalty and
certain criminal penalties including fines and imprisonment.
This Prospectus sets forth concisely the information about the Phoenix
Worldwide Opportunities Fund (the "Fund") which you should know before
investing. Please read it carefully and retain it for future reference.
The Fund has filed with the Securities and Exchange Commission a Statement of
Additional Information about the Fund, dated October 30, 1995. The Statement
contains more detailed information about the Fund and is incorporated into
this Prospectus by reference. You may obtain a free copy of the Statement by
writing the Fund c/o Phoenix Equity Planning Corporation, 100 Bright Meadow,
P.O. Box 2200, Enfield, Connecticut 06083-2200.
Financial information relating to the Trust is contained in the Annual Report
to Shareholders for the year ended June 30, 1994 and is incorporated into the
Statement of Additional Information by reference.
[recycle symbol] Printed on recycled paper using soybean ink
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
101 Munson Street
Greenfield, MA 01301
Statement of Additional Information
Dated October 30, 1995
This Statement of Additional Information is not a prospectus, but expands
upon and supplements the information contained in the current Prospectus of
Phoenix Worldwide Opportunities Fund (the "Fund"), dated October 30, 1995,
and should be read in conjunction with it. The Fund's Prospectus may be
obtained by calling Phoenix Equity Planning Corporation ("Equity Planning")
at (800) 243-4361 or by writing to Equity Planning at 100 Bright Meadow
Boulevard, P.O. Box 2200, Enfield, CT 06083-2200.
TABLE OF CONTENTS
PAGE
THE FUND (20) ............................................... 1
INVESTMENT OBJECTIVES AND POLICIES (6) ...................... 1
INVESTMENT RESTRICTIONS (9) ................................. 1
PERFORMANCE INFORMATION (6) ................................. 4
PORTFOLIO TRANSACTIONS AND BROKERAGE ........................ 5
SERVICES OF THE ADVISER (9) ................................. 6
NET ASSET VALUE (17) ........................................ 7
HOW TO BUY SHARES (11) ...................................... 7
ALTERNATIVE PURCHASE ARRANGEMENTS (11) ...................... 7
EXCHANGE PRIVILEGE (16) ..................................... 9
REDEMPTION OF SHARES (18) ................................... 9
DIVIDENDS, DISTRIBUTIONS AND TAXES (19) ..................... 10
TAX SHELTERED RETIREMENT PLANS .............................. 12
THE NATIONAL DISTRIBUTOR (9) ................................ 12
PLANS OF DISTRIBUTION (10) .................................. 12
TRUSTEES AND OFFICERS ....................................... 14
ADVISORY BOARD .............................................. 19
OTHER INFORMATION (20) ...................................... 19
Numbers appearing in parentheses correspond to related disclosures in the Fund's
Prospectus.
Customer Service: (800) 243-1574
Marketing: (800) 243-4361
Telephone Orders/Exchanges: (800) 367-5877
TTY: (800) 243-1926
PEP732 (10/95)
<PAGE>
THE FUND
The Fund was originally incorporated in New York in 1956, and on January
13, 1992, the Fund was reorganized as a Massachusetts business trust. The
Fund has operated as an open-end, diversified management investment company
since May 1960. On June 30, 1993, the Trustees voted to change the name of
the Fund to "Phoenix Worldwide Opportunities Fund" to reflect the purchase of
the Adviser by Phoenix Home Life Mutual Insurance Company and the affiliation
with other Phoenix Funds.
INVESTMENT OBJECTIVES AND POLICIES
The Fund's investment objective is capital appreciation. The Fund's
investment objective is a fundamental policy and may not be changed without
shareholder approval.
Under normal circumstances, at least 65% of the total assets of the Fund
will be invested in the securities of issuers located in at least three
different countries, one of which will be the United States. The Fund will
invest primarily in equity securities (common stocks, preferred stocks,
securities convertible into common stocks, warrants and any rights to
purchase common stocks). The Fund may also invest up to 35% of its assets in
non-convertible fixed-income securities of U.S. and non-U.S. issuers
(described below) when the Adviser has determined that such securities are
appropriate for the achievement of the Fund's investment objective. Because
the market value of fixed-income securities can be expected to vary inversely
to changes in prevailing interest rates, investing in such fixed-income
securities can provide an opportunity for capital appreciation when interest
rates are expected to decline.
The non-convertible fixed-income securities referred to above will consist
of (1) corporate notes, bonds and debentures of U.S. issuers that are rated
high grade (i.e. within the three highest rating categories of Standard &
Poor's or Moody's Investors Service) or, if unrated, are deemed by the
Adviser to be of comparable quality to those securities that are rated high
grade, (2) corporate notes, bonds, debentures and other securities (such as
Euro-currency instruments) of non-U.S. issuers that are rated within the
three highest rating categories of rating services chosen by the Adviser to
rate foreign debt obligations or, if unrated, are deemed by the Adviser to be
of comparable credit quality to rated securities that may be purchased and
(3) Treasury bills, notes and bonds issued by the United States Government or
its agencies or instrumentalities and securities issued by foreign
governments and supranational agencies (such as World Bank).
The Fund may, for daily cash management purposes, invest in the
non-convertible fixed income securities described above or in high quality
money market securities. In addition, the Fund may invest, without limit, in
any combination of the U.S. Government securities and money market
instruments referred to above when, in the opinion of the Adviser, it is
determined that a temporary defensive position is warranted based upon
current market conditions. In such instances, the Fund will not be achieving
its stated investment objective.
The percentage of the Fund's assets invested in particular geographic
sectors will shift from time to time in accordance with the judgment of the
Adviser. The Adviser will advise the Fund with respect to all other
investments for the Fund.
Capital appreciation will more often than not be sought through long-term
holdings but the Fund may attempt to take advantage of apparent short-term
trends, and such operations will occasion more trading, and hence, more than
normal brokerage commissions and other expenses. Investments are selected for
the Fund in such proportions and amounts as deemed advisable, subject to the
investment restrictions set forth herein (see "Investment Restrictions"), in
accordance with the Adviser's judgment of investment opportunities and the
general economic outlook.
INVESTMENT RESTRICTIONS
Fundamental Policies
The following investment restrictions are fundamental policies that cannot
be changed without the approval of the holders of a majority of the Fund's
outstanding voting securities (which means the lesser of (a) 67% of the
shares represented at a meeting at which more than 50% of the outstanding
shares are represented or (b) more than 50% of the outstanding shares).
The Fund may not:
(1) borrow money, except from a bank and then only if there is an asset
coverage of at least 300%; provided, however, that the Fund may not purchase
securities while outstanding borrowings exceed 5% of the Fund's total assets;
(2) underwrite the sale of securities of restricted securities);
(3) purchase or sell real estate;
(4) purchase or sell commodities or commodity contracts; provided, however,
that the terms commodities and commodity contracts shall not be deemed to
include (i) forward foreign currency exchange contracts (ii) futures contracts
on foreign currencies, (iii) options on futures contracts or (iv) options on
foreign currencies;
(5) lend money, except in connection with the acquisition of a
portion of an issue of publicly distributed bonds, debentures or other
corporate obligations; or
(6) issue senior securities except to the extent that it is permitted (a) to
borrow money from banks pursuant to the Fund's investment restriction regarding
the borrowing of money, and (b) to enter into transactions involving forward
foreign currency exchange contracts, foreign currency futures contracts and
options thereon, and options on foreign currencies as described in the Fund's
Prospectus and this Statement of Additional Information;
(7) invest more than 25% of its total assets in any one industry. For
purposes of this policy, foreign governments and supranational agencies shall be
deemed to be separate industries.
1
<PAGE>
(8) make short sales unless at the time of the sale the Fund owns, or by
virtue of ownership of other securities, has the right to obtain, at least an
equal amount of the securities sold short;
(9) issue bonds, debentures, or senior equity securities;
(10) issue any of its securities other than for cash or
securities (including securities of which the Fund is the issuer), except as a
dividend or distribution or in connection with a reorganization;
(11) purchase securities on margin, except as may be permitted under the
Investment Company Act of 1940 (the "1940 Act"), and except that, for purposes
of this restriction, the deposit or payment of initial or variation margin in
connection with the entry into or use of futures contracts will not be deemed to
be a purchase of securities on margin;
(12) invest in companies for the purpose of exercising control or management;
or
(13) invest in securities of other investment companies extent to the extent
permitted by the 1940 Act.
Other Policies
The following investment restrictions do not constitute fundamental policies
and may, therefore, be changed without shareholder approval.
The Fund intends to comply with the Statement of Policy on investment
companies approved by certain state securities commissioners. Additional
investment restrictions currently imposed by the Statement of Policy are as
follows: The Fund will not
(1) purchase any securities (excluding government securities) if by reason
thereof more than 5% of the Fund's total assets (taken at current value) would
then be invested in securities of a single issuer;
(2) purchase any securities if, as a result, the Fund would then have more
than 5% of its total assets (taken at current value) invested in securities of
companies (including their predecessors) with less than three years of operating
history,
(3) invest more than 5% of its total assets in puts, calls, straddles,
spreads, and/or any combination thereof; and
(4) invest in interests in oil, gas, or other mineral exploration or
development programs;
(5) invest more than 15% of its net assets in illiquid securities, comprised
of assets which may not be sold or disposed of in the ordinary course of
business within seven days at approximately the value at which the Fund has
valued the investment.
In addition, the Fund has given undertakings to certain state securities
commissioners to the effect that (a) the Fund will not purchase warrants
(except warrants acquired by the Fund in units or attached to securities
which may be deemed to be without value) in amounts in excess of 5% of the
Fund's net assets, and (b) the Fund may purchase put or call options or
combinations thereof written by others, provided the aggregate premiums paid
for all such options held do not exceed 2% of the Fund's net assets.
Writing Covered Call Options
The Fund may write covered call option contracts, which are options on
securities that the Fund owns, if such options are listed on an organized
securities exchange and the Adviser determines that such activity is
consistent with the Fund's investment objective. Regulations of certain state
securities commissions currently limit the aggregate value of the securities
underlying the calls to not more than 25% of the net assets of the Fund. A
call option gives the purchaser of the option the right to buy the underlying
security from the writer at the exercise price at any time prior to the
expiration of the contract, regardless of the market price of the security
during the option period. The premium paid to the writer is the consideration
for undertaking the obligations under the option contract. The writer forgoes
the opportunity to profit from an increase in the market price of the
underlying security above the exercise price except insofar as the premium
represents such a profit. The writing of option contracts is a highly
specialized activity which involves investment techniques and risks different
from those ordinarily associated with investment companies, and the
restrictions listed above would tend to reduce such risks.
Securities for the Fund's portfolio will continue to be bought and sold on
the basis of investment considerations and appropriateness to the fulfillment
of the Fund's investment objective. In order to close out a position, the
Fund will normally make a "closing purchase transaction"--the purchase of a
call option on the same security with the same exercise price and expiration
date as the call option which it has previously written on any particular
security. When a security is sold from the Fund's portfolio, the Fund will
effect a closing purchase transaction so as to close out any existing call
option on that security.
Forward Foreign Currency Exchange Contracts
In order to hedge against adverse movements in exchange rates between
currencies, the Fund may enter into forward foreign currency exchange
contracts ("forward currency contracts") for the purchase or sale of a
specified currency at a specified future date. Such contracts may involve the
purchase or sale of a foreign currency against the U.S. dollar or may involve
two foreign currencies. The Fund may enter into forward currency contracts
either with respect to specific transactions or with respect to the Fund's
portfolio positions.
Futures Contracts on Foreign Currencies and Options on Futures Contracts
The Fund may engage in futures contracts on foreign currencies and options
on these futures transactions as a hedge against changes in the value of the
currencies to which the Fund is subject or to which the Fund expects to be
subject in connection with future purchases, in accordance with the rules and
regulations of the Commodity Futures Trading Commission (the "CFTC"). The
Fund also may engage in such transactions when they are economically
appropriate for the reduction of risks inherent in the ongoing management of
the Fund.
2
<PAGE>
The Fund may buy and sell futures contracts on foreign currencies and
groups of foreign currencies. The Fund will engage in transactions in only
those futures contracts and options thereon that are traded on a commodities
exchange or a board of trade. A "sale" of a futures contract means the
assumption of a contractual obligation to deliver the specified amount of
foreign currency as a specified price in a specified future month. A
"purchase" of a futures contract means the assumption of a contractual
obligation to acquire the currency called for by the contract as a specified
price in a specified future month. At the time a futures contract is
purchased or sold, the Fund must allocate cash or securities as a deposit
payment (initial margin). Thereafter, the futures contract is valued daily
and the payment of "variation margin" may be required, resulting in the
Fund's providing or receiving cash that reflects any decline or increase in
the contract's value, a process known as "marking to market".
Options on Foreign Currencies
The Fund may purchase and write put and call options on foreign currencies
traded on securities exchanges or boards of trade (foreign and domestic) for
hedging purposes in a manner similar to that in which forward currency
contracts and futures contracts on foreign currencies will be employed.
Options on foreign currencies are similar to options on stock, except that
the Fund has the right to take or make delivery of a specified amount of
foreign currency, rather than stock.
The Fund may purchase and write options to hedge the Fund's portfolio
securities denominated in foreign currencies. If there is a decline in the
dollar value of a foreign currency in which the Fund's portfolio securities
are denominated, the dollar value of such securities will decline even though
foreign currency value remains the same. See "Special Considerations and Risk
Factors". To hedge against the decline of the foreign currency, the Fund may
purchase put options on such foreign currency. If the value of the foreign
currency declines, the gain realized on the put option would offset, in whole
or in part, the adverse effect such decline would have on the value of the
portfolio securities. Alternatively, the Fund may write a call option on the
foreign currency. If the value of the foreign currency declines, the option
would not be exercised and the decline in the value of the portfolio
securities denominated in such foreign currency would be offset in part by
the premium the Fund received for the option.
If, on the other hand, the Adviser anticipates purchasing a foreign
security and also anticipates a rise in the value of such foreign currency
(thereby increasing the cost of such security), the Fund may purchase call
options on the foreign currency. The purchase of such options could offset,
at least partially, the effects of the adverse movements of the exchange
rates. Alternatively, the Fund could write a put option on the currency and,
if the exchange rates move as anticipated, the option would expire
unexercised.
Segregated Accounts
At the time of purchase of a futures contract, option on futures contract or
forward foreign currency exchange contract, an amount of cash, U.S.
Government securities or other appropriate high-grade debt obligations equal
to the contract's market value minus initial margin deposit will be deposited
in a segregated account with the Fund's custodian bank to fully collateralize
the position.
Other Policies
The Fund is authorized to invest in the securities of other investment
companies subject to the limitations contained in the 1940 Act. In certain
countries, investments by the Fund may only be made through investments in
other investment companies that, in turn, are authorized to invest in the
securities that are issued in such countries. Investors should recognize that
the Fund's purchase of the securities of such other investment companies
results in the layering of expenses such that investors indirectly bear a
proportionate part of the expenses for such investment companies including
operating costs and investment advisory and administrative fees.
Special Considerations and Risk Factors
Investing in the securities of foreign companies involves special risks and
considerations not typically associated with investing in U.S. companies.
These include: differences in accounting, auditing and financial reporting
standards, generally higher commission rates on foreign portfolio
transactions, the possibility of expropriation or confiscatory taxation,
adverse changes in investment or exchange control regulations, political
instability which could affect U.S. investments in foreign countries, and
potential restrictions on the flow of international capital. Additionally,
dividends payable on foreign securities may be subject to foreign taxes
withheld prior to distribution. Foreign securities often trade with less
frequency and volume than domestic securities and therefore may exhibit
greater price volatility, and changes in foreign exchange rates will affect
the value of those securities which are denominated or quoted in securities
which are denominated or quoted in currencies other than the U.S. dollar.
Many of the foreign securities held by the Fund will not be registered with,
nor the issuers thereof be subject to the reporting requirements of, the U.S.
Securities and Exchange Commission. Accordingly, there may be less publicly
available information about the securities and about the foreign company or
government issuing them than is available about a domestic company or
government entity. Moreover, individual foreign economies may differ
favorably or unfavorably for the United States economy in such respects as
growth of Gross National Product, rate of inflation, capital reinvestment,
resource self-sufficiency and balance of payment positions.
The Fund's use of forward currency contracts involves certain investment
risks and transaction costs to which it might not otherwise be subject. These
include: (1) the Adviser may not always be able to accurately predict
movements within currency markets, (2) the skills and techniques needed to
use forward currency contracts are different from those needed to select the
securities in which the Fund invests and (3) there is no assurance that a
liquid secondary market will exist that would enable the Adviser to "close
out" existing forward contracts when doing so is desirable. The Fund's
successful use of forward currency
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contracts, options on foreign currencies, futures contracts on foreign
currencies and options on such contracts depends upon the Adviser's ability
to predict the direction of the market and political conditions, which
require different skills and techniques than predicting changes in the
securities markets generally. For instance, if the value of the securities
being hedged moves in a favorable direction, the advantage to the Fund would
be wholly or partially offset by a loss in the forward contracts or futures
contracts. Further, if the value of the securities being hedged does not
change, the Fund's net income would be less than if the Fund had not hedged
since there are transaction costs associated with the use of these investment
practices.
These practices are subject to various additional risks. The correlation
between movements in the price of options and futures contracts and the price
of the currencies being hedged is imperfect. The use of these instruments
will hedge only the currency risks associated with investments in foreign
currency advances before it invests in securities denominated in such
currency and the currency market declines, the Fund might incur a loss on the
futures contract. The Fund's ability to establish and maintain positions will
depend on market liquidity. The ability of the Fund to close out a futures
position or an option depends upon a liquid secondary market. There is no
assurance that liquid secondary markets will exist for any particular futures
contract or option at any particular time.
PERFORMANCE INFORMATION
The Fund may, from time to time, include its total return in
advertisements or reports to shareholders or prospective investors.
Standardized quotations of average annual total return for Class A or
Class B Shares will be expressed in terms of the average annual compounded
rate of return for a hypothetical investment in either Class A or Class B
Shares over periods of 1, 5 and 10 years or up to the life of the class of
shares), calculated for each class separately pursuant to the following
formula: P(1+T)n = ERV (where P = a hypothetical initial payment of $1,000, T
= the average annual total return, n = the number of years, and ERV = the
ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period). All total return figures reflect the deduction of a
proportional share of each Class's expenses (on an annual basis), deduction
of the maximum initial sales load in the case of Class A Shares and the
maximum contingent deferred sales charge applicable to a complete redemption
of the investment in the case of Class B Shares, and assume that all
dividends and distributions on Class A and Class B Shares are reinvested when
paid.
Performance information for the Fund may be compared, in reports and
promotional literature, to: (i) the EAFE (European, Australian, and Far
Eastern) Index, the Europac Index, or other unmanaged indices so that
investors may compare the Fund's results with those of a group of unmanaged
securities widely regarded by investors as representative of the securities
markets in general; (ii) other groups of mutual funds tracked by Lipper
Analytical Services, Inc., a widely used independent research firm which
ranks mutual funds by overall performance, investment objectives, and assets,
or tracked by other services, companies, publications, or persons who rate or
rank mutual funds on overall performance or other criteria; and (iii) the
Consumer Price Index (measure for inflation) to assess the real rate of
return from an investment in the Fund. Unmanaged indices may assume the
reinvestment of dividends but generally do not reflect deductions for
administrative and management costs and expenses.
The Fund may from time to time include in advertisements containing total
return the ranking of those performance figures relative to such figures for
groups of mutual funds having similar investment objectives as categorized by
ranking services such as Lipper Analytical Services, Inc., CDA Investment
Technologies, Inc., Weisenberger Financial Services, Inc. and Morningstar,
Inc. Additionally, the Fund may compare its performance results to other
investment or savings vehicles (such as certificates of deposit) and may
refer to results published in various publications such as Changing Times,
Forbes, Fortune, Money, Barrons, Business Week and Investor's Daily,
Stanger's Mutual Fund Monitor, The Stanger Register, Stanger's Investment
Adviser, The Wall Street Journal, The New York Times, Consumer Reports,
Registered Representative, Financial Planning, Financial Services Weekly,
Financial World, U.S. News and World Report, Standard & Poor's The Outlook,
and Personal Investor. The Fund may from time to time illustrate the benefits
of tax deferral by comparing taxable investments to investments made through
tax-deferred retirement plans. The total return may also be used to compare
the performance of the Fund against certain widely acknowledged outside
standards or indices for stock and bond market performance, such as the
Standard & Poor's 500 Stock Index (the "S&P 500"), Dow Jones Industrial
Average, Europe Australia Far East Index (EAFE), Consumer's Price Index,
Shearson Lehman Corporate Index and Shearson Lehman T-Bond Index. The S&P 500
is a commonly quoted market value-weighted and unmanaged index showing the
changes in the aggregate market value 500 common stocks relative to the base
period 1941-43. The S&P 500 is composed almost entirely of common stocks of
companies listed on the New York Stock Exchange, although the common stocks
of a few companies listed on the American Stock Exchange or traded over the
counter are included. The 500 companies represented include 400 industrial,
60 transportation and 40 financial services concerns. The S&P 500 represents
about 80% of the market value of all issues traded on the New York Stock
Exchange.
Advertisements, sales literature and other communications may contain
information about the Fund and Adviser's current investment strategies and
management style. Current strategies and style may change to allow the Fund
to respond quickly to changing market and economic conditions. From time to
time the Fund may include specific portfolio holdings or industries, in such
communications. To illustrate components of overall performance, the Fund may
separate its cumulative and average annual returns into income and capital
gains components; or cite separately as a return figure the equity or bond
portion of the Fund's
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portfolio; or compare the Fund's equity or bond return future to well-known
indices of market performance, including, but not limited to: the S&P 500
Index, Dow Jones Industrial Average, First Boston High Yield Index and
Salomon Brothers Corporate Bond and Government Bond Indices.
For the 1, 5 and 10 year periods ended June 30, 1995, the average annual
total return of the Class A was 1.44%, 7.55% and 6.63%, respectively. For the
year ended June 30, 1995, for Class B Shares, the total return since
inception 7/15/94 was -0.77%. Performance information reflects only the
performance of a hypothetical investment in each class during the particular
time period on which the calculations are based. Performance information
should be considered in light of the Fund's investment objectives and
policies, characteristics and quality of the portfolio, and the market
condition during the given time period, and should not be considered as a
representation of what may be achieved in the future.
The Fund may also compute aggregate total return for specified periods
based on a hypothetical Class A or Class B account with an assumed initial
investment of $10,000. The aggregate total return is determined by dividing
the net asset value of this account at the end of the specified period by the
value of the initial investment and is expressed as a percentage. Calculation
of aggregate total return reflects payment of the Class A Shares's maximum
sales charge of 4.75% and assumes reinvestment of all income dividends and
capital gain distributions during the period. Based on the foregoing, the
Class A Share's aggregate total return quotation for the period commencing
May 13, 1960 and ending June 30, 1995 was 1,639.29%.
The Fund also may quote annual, average annual and annualized total return
and aggregate total return performance data, for both classes of shares of
the Fund, both as a percentage and as a dollar amount based on a hypothetical
$10,000 investment for various periods other than those noted above. Such
data will be computed as described above, except that (1) the rates of return
calculated will not be average annual rates, but rather, actual annual,
annualized or aggregate rates of return and (2) the maximum applicable sales
charge will not be included with respect to annual, annualized or aggregate
rate of return calculations.
PORTFOLIO TRANSACTIONS AND BROKERAGE
The Adviser places orders for the purchase and sale of securities,
supervises their execution and negotiates brokerage commissions on behalf of
the Fund. It is the practice of the Adviser to seek the best prices and
execution of orders and to negotiate brokerage commissions which in its
opinion are reasonable in relation to the value of the brokerage services
provided by the executing broker. Brokers who have executed orders for the
Fund are asked to quote a fair commission for their services. If the
execution is satisfactory and if the requested rate approximates rates
currently being quoted by the other brokers selected by the Adviser, the rate
is deemed by the Adviser to be reasonable. Brokers may ask for higher rates
of commission if all or a portion of the securities involved in the
transaction are positioned by the broker, if the broker believes it has
brought the Fund an unusually favorable trading opportunity, or if the broker
regards its research services as being of exceptional value. Payment of such
commissions is authorized by the Adviser after the transaction has been
consummated. If the Adviser more than occasionally differs with the broker's
appraisal of opportunity or value, the broker would not be selected to
execute trades in the future. The Adviser believes that the Fund benefits
with a securities industry comprised of many diverse firms and that the
long-term interests of shareholders of the Fund are best served by their
brokerage policies which include paying a fair commission rather than seeking
to exploit their leverage to force the lowest possible commission rate. The
primary factors considered in determining the firms to which brokerage orders
are given are the Adviser's appraisal of: the firm's ability to execute the
order in the desired manner, the value of research services provided by the
firm, and the firm's attitudes toward and interest in mutual funds in general
including those managed and sponsored by the Adviser. The Adviser does not
offer or promise to any broker an amount or percentage of brokerage
commissions as an inducement or reward for the sale of shares of the Fund.
Over-the-counter purchases and sales are transacted directly with principal
market-makers except in those circumstances where, in the opinion of the
Adviser, better prices and executions are available elsewhere. In the
over-the-counter market, securities are usually traded on a "net" basis with
dealers acting as principal for their own accounts without a stated
commission, although the price of the security usually contains a profit to
the dealer. The Fund also expects that securities will be purchased at time
in underwritten offerings where the price includes a fixed amount of
compensation, usually referred to as the underwriter's concession or
discount. The foregoing discussion does not relate to transactions effected
on foreign securities exchanges which do not permit the negotiation of
brokerage commissions and where the Adviser would, under the circumstances,
seek to obtain best price and execution on orders for the Fund.
In general terms, the nature of research services provided by brokers
encompasses statistical and background information, and forecasts and
interpretations with respect to U.S. and foreign economies, U.S. and foreign
money markets, fixed income markets and equity markets, specific industry
groups, and individual issues. Research services will vary from firm to firm,
with broadest coverage generally from the large full-line firms. Smaller
firms in general tend to provide information and interpretations on a smaller
scale, frequently with a regional emphasis. In addition, several firms
monitor Federal, state, local, and foreign political developments. Many of
the brokers also provide access to outside consultants. The outside research
assistance is particularly useful to the Adviser's staff since the brokers,
as a group, tend to monitor a broader universe of securities and other
matters than the Adviser's staff can follow. In addition, it provides the
Adviser with a diverse perspective on financial markets. Research and
investment information is provided by these and other brokers at no cost to
the Adviser and is available for the benefit of other accounts advised by the
Adviser and its affiliates and not all of the information will be used in
connection with the Fund. While
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this information may be useful in varying degrees and may tend to reduce the
Adviser's expense, it is not possible to estimate its value and in the
opinion of the Adviser it does not reduce the Adviser's expenses in a
determinable amount. The extent to which the Adviser makes use of statistical
research and other services furnished by brokers is considered by the Adviser
in the allocation of brokerage business but there is no formula by which such
business is allocated. The Adviser does so in accordance with its judgment of
the best interests of the Fund and its shareholders.
During the fiscal years ended June 30, 1993, 1994, and 1995, brokerage
commissions paid by the Fund totalled $440,207, $1,204,612, and $1,792,000,
respectively. Of the total amounts paid in the fiscal years ended June 30,
1993, 1994, and 1995, $16,630, $0, and $0, respectively, or 0.02%, 0.00%, and
0.00% respectively of Fund assets were paid to the former principal
underwriter in accordance and consistent with internal procedures governing
such affiliated transactions, in accordance and consistent with regulatory
requirements.
SERVICES OF THE ADVISER
National Securities & Research Corporation serves as investment adviser
for the Fund pursuant to a Management Agreement entered into between the Fund
and the Adviser. Pursuant to the Management Agreement, the Adviser is
responsible for advising the Fund with respect to all investments. In
addition, the Adviser provides certain services and facilities required to
carry on the day-to-day operations of the Fund (for which it receives a
management fee) other than the costs of printing and mailing proxy materials,
reports and notices to shareholders, legal counsel, accounting and auditing
services, regulatory filing fees and expenses of printing the Fund's
registration statements (but the Underwriter purchases such copies of the
Fund's prospectuses and reports and communication to shareholders as it may
require for sales purposes at printer's over-run cost), insurance expense,
association membership dues, brokerage fees, and taxes.
The Adviser is an indirect wholly-owned subsidiary of Phoenix Home Life
Mutual Insurance Company ("Phoenix Home Life"). Phoenix Home Life's principal
place of business is located at One American Row, Hartford, Connecticut,
where the Company manages combined assets of approximately $12 billion
through advisory accounts and mutual funds. The Adviser also serves as
investment adviser to Phoenix Asset Reserve, Phoenix California Tax Exempt
Bonds, Inc., Phoenix Income and Growth Fund, Phoenix Multi-Sector Fixed
Income Fund, Inc. and Phoenix Strategic Equity Series Fund. The Adviser
currently has approximately $1.7 billion in assets under management. The
Adviser has acted as an investment adviser for over sixty years.
The current Management Agreement was approved by the Trustees of the Fund
on March 16, 1993 and by the shareholders of the Fund on May 7, 1993. The
Management Agreement became effective on May 14, 1996, and it will continue
in effect until May 14, 1995. After that date, the Management Agreement will
continue in effect from year to year if specifically approved annually by a
majority of the Trustees who are not interested persons of the parties
thereto, as defined in the 1940 Act, and by either (a) the Trustees of the
Fund or (b) the vote of a majority of the outstanding voting securities of
the Fund (as defined in the 1940 Act). The Agreement may be terminated
without penalty at any time by the Trustees or by a vote of a majority of the
outstanding voting securities of the Fund or by the Adviser upon 60 days'
written notice and will automatically terminate in the event of its
"assignment" as defined in Section (2)(a)(4) of the 1940 Act.
The Management Agreement provides that the Adviser is not liable for any
act or omission in the course of, or in connection with, rendering services
under the Agreement in the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties under the
Agreement. The Agreement permits the Adviser to render services to others and
to engage in other activities.
As compensation for its services, the Adviser receives a fee, which is
accrued daily against the value of the Fund's net assets and is paid by the
Fund on the last day of the month. The fee is computed at an annual rate of
.75% of the Fund's average daily net assets of up to $1 billion, .70% of the
Fund's average daily net assets from $1 billion to $2 billion, and .65% of
the Fund's average net assets in excess of $2 billion. Total management fees
for the fiscal years ended June 30, 1993, 1994, and 1995 amounted to
$636,241, $813,237, and $972,771, respectively.
The Adviser makes its personnel available to serve as officers and
"interested" Trustees of the Fund. The Fund has not directly compensated any
of its officers or Trustees for services in such capacities except to pay
fees to the Trustees who are not otherwise affiliated with the Fund. The Fund
reimburses all Trustees for their out-of-pocket expenses. The Trustees of the
Fund are not prohibited from authorizing the payment of salaries to the
officers pursuant to the Management Agreement, including out-of-pocket
expenses, at some future time.
In addition to the management fee, expenses paid by the Fund include: fees
of Trustees who are not "interested persons," interest charges, taxes, fees
and commissions of every kind, including brokerage fees, expenses of
issuance, repurchase or redemption of shares, expenses of registering or
qualifying shares for sale (including the printing and filing of the Fund's
registration statements, reports and prospectuses excluding those copies used
for sales purposes which the Underwriter purchases at printer's over-run
cost), accounting services fees, insurance expenses, association membership
dues, all charges of custodians, transfer agents, registrars, auditors and
legal counsel, expenses of preparing, printing and distributing all proxy
material, reports and notices to shareholders, and, all costs incident to the
Fund's existence as a Massachusetts business trust.
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The Adviser has agreed, under the terms of the Management Agreement, to
reimburse the Fund to the extent that, in any fiscal year, aggregate annual
expenses of the Fund, exclusive of taxes, interest, brokerage fees, payments
made pursuant to a Rule 12b-1 distribution plan, and extraordinary charges
such as litigation costs, exceed the most restrictive expense limitations
imposed by any state in which the Fund's shares are qualified for sale.
Currently, the most restrictive expense limitation currently applicable to
the Fund, which provides that aggregate annual expenses of an investment
company (which excludes interest, taxes, certain annual distribution plan
expenses, litigation costs, and capital items such as brokerage costs) shall
not normally exceed 2.5% of the first $30,000,000 of the Fund's average net
assets, 2% of the next $70,000,000 of the Fund's average net assets, and 1.5%
of the remaining average net assets of the investment company for any fiscal
year. To the extent that the Fund's expenses exceed this limitation, the
Adviser would be required to reduce or rebate its management fee. The Adviser
would not be required to absorb any other Fund expenses in excess of its
fees. See the "Fund Expenses" Table in the Fund's current Prospectus for
further information.
NET ASSET VALUE
The net asset value of the Fund's shares is determined as of the close of
regular trading of the New York Stock Exchange. The New York Stock Exchange is
scheduled to be closed on New Year's Day, President's Day (observed), Good
Friday, Memorial Day (observed), Independence Day, Labor Day, Thanksgiving
Day, and Christmas Day.
The net asset value is computed by dividing the value of the securities
held by the Fund, plus any cash and other assets and less all liabilities by
the number of shares outstanding. See "Net Asset Value" in the prospectus.
A security listed or traded on an exchange is valued at its last sale
price on the exchange where it is principally traded. Lacking any sales on
the exchange where it is principally traded on the day of valuation, the
security is valued at the mean between the last bid and asked prices on that
exchange. All other securities for which over-the-counter market quotations
are readily available are valued at the last current bid price. When market
quotations are not readily available or when restricted securities are being
valued, such securities are valued at fair value as determined in good faith
by the Trustees. In the over-the-counter market, securities are generally
traded on a "net" basis, with dealers acting as principal for their own
accounts without a stated commission, although the price of the security
usually includes a profit to the dealer. Securities will be purchased at
times in underwritten offerings where the price includes a fixed amount of
compensation, generally referred to as the underwriter's concession or
discount.
The Fund will calculate the net asset value and complete orders to
purchase, exchange or redeem shares only on a Monday-Friday basis (excluding
holidays on which the New York Stock Exchange is closed). Foreign securities
in which the Fund may invest may be primarily listed on foreign stock
exchanges which may trade on other days (such as Saturdays).
Occasionally, events which affect the values of such securities and
foreign currency exchange rates may occur between the time at which they are
generally determined and the close of the New York Stock Exchange and would
therefore not be reflected in the computation of the Fund's net asset value.
If events materially affecting the value as determined in good faith by the
Adviser under procedures established and regularly reviewed by the Board of
Trustees. To the extent the Fund invests in foreign securities listed on
foreign exchanges which trade on days on which the Fund does not determine
its net asset value (for example, Saturdays and other customary national U.S.
Holidays) the Fund's net asset value could be significantly affected on days
when shareholders have no access to the Fund.
HOW TO BUY SHARES
Shares may be purchased from investment dealers having sales agreements
with the Underwriter at the public offering price (the net asset value next
computed following receipt by State Street Bank and Trust Company of a
purchase application in proper form, plus the applicable sales charge). The
minimum initial investment is $500 ($25 if using the bank draft investing
program designated "Investo-Matic") and the minimum subsequent investment
amount is $25. In the case of employee payroll deduction plans, organized
group plans and other benefit programs or arrangements offered by certain
dealers, the minimum initial investment may be fixed from time to time at
such lesser amounts as the Adviser in its sole discretion may determine, and
may in all cases, be waived from time to time by the Adviser, in its sole
discretion. See the Fund's current Prospectus.
ALTERNATIVE PURCHASE ARRANGEMENTS
Shares of the Fund may be purchased from investment dealers at a price
equal to their net asset value per share, plus a sales charge which, at the
election of the purchaser, may be imposed either (i) at the time of the
purchase (the "initial sales charge alternative"), or (ii) on a contingent
deferred basis (the "deferred sales charge alternative").
Class A Shares
An investor who elects the initial sales charge alternative acquires Class A
Shares. Class A Shares incur a sales charge when they are purchased and enjoy
the benefit of not being subject to any sales charge when they are redeemed.
Class A Shares are subject to an ongoing distribution services fee at an
annual rate of up to 0.30% of the Fund's aggregate average daily net assets
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attributable to the Class A Shares. However, for the fiscal year 1996, the
Underwriter has voluntarily agreed to limit the distribution services fee for
Class A Shares to 0.25%. In addition, certain purchases of Class A Shares
qualify for reduced initial sales charges. See the Fund's current Prospectus.
Class B Shares
An investor who elects the deferred sales charge alternative acquires Class
B Shares. Class B Shares do not incur a sales charge when they are purchased,
but they are subject to a sales charge if they are redeemed within five years
of purchase. The deferred sales charge may be waived in connection with
certain qualifying redemptions. See the Fund's current Prospectus.
Class B Shares are subject to an ongoing distribution services fee at an
annual rate of up to 1.00% of the Fund's aggregate average daily net assets
attributable to the Class B Shares. Class B Shares enjoy the benefit of
permitting all of the investor's dollars to work from the time the investment
is made. The higher ongoing distribution services fee paid by Class B Shares
will cause such shares to have a higher expense ratio and to pay lower
dividends, to the extent any dividends are paid, than those related to Class
A Shares. Class B Shares will automatically convert to Class A Shares eight
years after the end of the calendar month in which the shareholder's order to
purchase was accepted, in the circumstances and subject to the qualifications
described in the Fund's Prospectus. The purpose of the conversion feature is
to relieve the holders of the Class B Shares that have been outstanding for a
period of time sufficient for the adviser and the Underwriter to have been
compensated for distribution expenses related to the Class B Shares from most
of the burden of such distribution related expenses. See "Conversion
Feature," below.
The alternative purchase arrangement permits an investor to choose the
method of purchasing shares that is more beneficial given the amount of the
purchase, the length of time the investor expects to hold the shares, whether
the investor wishes to receive distributions in cash or to reinvest them in
additional shares of the Fund, and other circumstances. Investors should
consider whether, during the anticipated life of their investment in the
Fund, the accumulated continuing distribution services fee and contingent
deferred sales charges on Class B Shares prior to conversion would be less
than the initial sales charge and accumulated distribution services fee on
Class A Shares purchased at the same time, and to what extent such
differential would be offset by the lower expenses attributable to Class A
Shares.
Class A Shares are subject to a lower distribution services fee and,
accordingly, pay correspondingly higher dividends, to the extent any
dividends are paid, per share. However, because initial sales charges are
deducted at the time of purchase, such investors would not have all their
funds invested initially and, therefore, would initially own fewer shares.
Investors not qualifying for reduced initial sales charges who expect to
maintain their investment for an extended period of time might consider
purchasing Class A Shares because the accumulated continuing distribution
charges on Class B Shares may exceed the initial sales charge on Class A
Shares during the life of the investment. Again, however, such investors must
weigh this consideration against the fact that, because of such initial sales
charges, not all their funds will be invested initially. However, other
investors might determine that it would be more advantageous to purchase
Class B Shares to have all their funds invested initially, although remaining
subject to higher continuing distribution charges and, for a five-year
period, being subject to a contingent deferred sales charge.
The distribution expenses incurred by the Underwriter in connection with
the sale of the shares will be paid, in the case of Class A Shares, from the
proceeds of the initial sales charge and the ongoing distribution services
fee and, in the case of Class B Shares, from the proceeds of the ongoing
distribution services fee and the contingent deferred sales charge incurred
upon redemption within five years of purchase. Sales personnel of
broker-dealers distributing the Fund's shares may receive differing
compensation for selling Class A or Class B Shares. Investors should
understand that the purpose and function of the contingent deferred sales
charge and ongoing distribution services fee with respect to the Class B
Shares are the same as those of the initial sales charge and ongoing
distribution services fees with respect to the Class A Shares.
Dividends paid by the Fund, if any, with respect to Class A and Class B
Shares will be calculated in the same manner at the same time on the same
day, except that the higher distribution services fee and any incremental
transfer agency costs relating to Class B Shares will be borne exclusively by
that class. See "Dividends, Distributions and Taxes."
The Trustees of the Fund have determined that currently no conflict of
interest exists between the Class A and Class B Shares. On an ongoing basis,
the Trustees of the Fund, pursuant to their fiduciary duties under the 1940
Act and state laws, will seek to ensure that no such conflict arises.
Conversion Feature
Class B Shares include all shares purchased pursuant to the deferred sales
charge alternative which have been outstanding for less than the period
ending eight years after the end of the month in which the shares were
issued. At the end of this period, Class B Shares will automatically convert
to Class A Shares and will no longer be subject to the higher distribution
services fee. Such conversion will be on the basis of the relative net asset
value of the two classes without the imposition of any sales load, fee or
other charge. The purpose of the conversion feature is to relieve the holders
of Class B Shares that have been outstanding for a period of time sufficient
for the Underwriter to have been compensated for distribution expenses
related to the Class B Shares from most of the burden of such
distribution-related expenses.
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For purposes of conversion to Class A, shares purchased through the
reinvestment of dividends and distributions paid in respect of Class B Shares
in a shareholder's Fund account will be considered to be held in a separate
sub-account. Each time any Class B Shares in the shareholder's Fund account
(other than those in the sub-account) convert to Class A, an equal pro rata
portion of the Class B Shares in the sub-account will also convert to Class A.
The conversion of Class B Shares to Class A Shares is subject to the
continuing availability of an opinion of counsel or a ruling of the Internal
Revenue Service to the effect that (i) the assessment of the higher
distribution services fee and transfer agency costs with respect to Class B
Shares does not result in the Fund's dividends or distributions constituting
"preferential dividends" under the Internal Revenue Code of 1986, as amended
(the "Code") and (ii) that the conversion of shares does not constitute a
taxable event under federal income tax law. The Fund has not sought opinions
of counsel as to these matters or from the Internal Revenue Service (the
"IRS"). While rulings as to preferential dividends have been issued
previously by the IRS, complete assurance cannot of course be given that the
Fund eventually will request or receive such ruling. While an adverse
determination by the IRS currently is not expected, the Fund may be required
to reassess (and reserve the right to do so) its dual share structure were
the IRS not to rule favorably since that could impact on the Fund's ability
to qualify as a regulated investment company. In addition, were the IRS not
to rule favorably, the Fund might make additional distributions if doing so
would assist in complying with the Fund's general practice of distributing
sufficient income to reduce or eliminate U.S. Federal taxes. The conversion
of Class B Shares to Class A Shares may be suspended if such an opinion or
ruling is no longer available. In that event, no further conversions of Class
B Shares would occur, and shares might continue to be subject to the higher
distribution services fee for an indefinite period which may extend beyond
the period ending eight years after the end of the month in which the shares
were issued.
EXCHANGE PRIVILEGES
Subject to limitations, shareholders may exchange Class A or Class B
Shares held in book-entry form for shares of the same class of other Phoenix
Funds, provided the following conditions are met: (1) the shares that will be
acquired in the exchange (the "Acquired Shares") are available for sale in
the shareholder's state of residence; (2) the Acquired Shares are the same
class as the shares to be surrendered (the "Exchanged Shares"); (3) the
Acquired Shares will be registered to the same shareholder account as the
Exchanged Shares; (4) the account value of the Fund whose shares are to be
acquired must equal or exceed the minimum initial investment amount required
by that Fund after the exchange is implemented; and (5) if a shareholder has
elected not to utilize the Telephone Exchange Privilege (see below), a
properly executed exchange request must be received by Equity Planning. Other
restrictions on exchanges are described in the Prospectus of the applicable
Phoenix Funds.
Subject to the above requirements for an exchange, a shareholder or
his/her registered representative may, by telephone or written notice, elect
to have Class A or Class B Shares of the Fund exchanged for the same class of
shares of another Phoenix Fund automatically on a monthly, quarterly,
semi-annual or annual basis or may cancel the privilege ("Systematic
Exchange").
Shareholders who maintain an account balance in the Fund of at least
$5,000, or $2,000 for tax qualified retirement benefit plans (calculated on
the basis of the net asset value of the shares held in a single account), may
direct that shares of the Fund be automatically exchanged at predetermined
intervals for shares of the same class of another Phoenix Fund. If the
shareholder is participating in the Self Security program offered by Phoenix
Home Life, it is not necessary to maintain the above account balances in
order to use the Systematic Exchange Privilege.
Such exchanges will be executed upon the close of business on the 10th of
a month and if the 10th falls on a holiday or weekend, then at the close of
business on the next succeeding business day. The minimum initial and
subsequent amount that may be exchanged under the Systematic Exchange is $25.
Systematic Exchange forms are available from Equity Planning.
Exchanges will be based upon each Fund's net asset value per share next
computed following receipt of a properly executed exchange request, without
sales charge. On Class B Share exchanges, the contingent deferred sales
charge schedule of the original shares purchased continues to apply.
The exchange of shares from one fund to another is treated as sale of the
Exchanged Shares and a purchase of the Acquired Shares for Federal income tax
purposes. The shareholder may, therefore, realize a taxable gain or loss. See
"Dividends, Distributions and Taxes" of the Prospectus for information
concerning the Federal income tax treatment of a disposition of shares. It is
the policy of the Adviser to discourage and prevent frequent trading by
shareholders among the Fund and other Phoenix Funds in response to market
fluctuations. The Fund reserves the right to terminate or modify its exchange
privileges at any time upon giving prominent notice to shareholders at least
60 days in advance.
Each Phoenix Fund has different investment objectives and policies.
Shareholders should, therefore, obtain and review the prospectus of the fund
into which the exchange is to be made before any exchange requests are made.
REDEMPTION OF SHARES
Under the 1940 Act, payment for shares redeemed must ordinarily be made
within seven days after tender. The right to redeem shares may be suspended
and payment therefor postponed during periods when the New York Stock
Exchange is closed, other
9
<PAGE>
than customary weekend and holiday closings, or if permitted by rules of the
Securities and Exchange Commission, during periods when trading on the
Exchange is restricted or during any emergency which makes it impracticable
for the Fund to dispose of its securities or to determine fairly the value of
its net assets or during any other period permitted by order of the
Securities and Exchange Commission for the protection of investors.
Furthermore, the Transfer Agent will not mail redemption proceeds until
checks received for shares purchased have cleared, which may take up to 15
days after receipt of the check. See the Prospectus for further information.
Redemptions by Class B shareholders will be subject to the applicable
deferred sales charge, if any.
Each shareholder account in the Fund which has been in existence for at
least one year and has a value of less than $200 may be redeemed upon the
giving of not less than 60 days written notice to the shareholder mailed to
the address of record. During the 60 day period the shareholder has the right
to add to the account to bring its value to $200 or more. See the current
Prospectus for more information.
Telephone Redemptions
Shareholders who do not have certificated shares may redeem up to $50,000
worth of their shares by telephone. See the Fund's current Prospectus for
additional information.
Reinvestment Privilege
Shareholders who may have overlooked features of their investment at the
time they redeemed have the privilege of reinvesting their investment at net
asset value. See the Fund's current Prospectus for more information and
conditions attached to this privilege.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund intends to remain qualified as a regulated investment company
under certain provisions of the Code. Under such provisions, the Fund will
not be subject to Federal income tax on such part of its ordinary income and
net realized capital gains which it distributes to shareholders provided it
meets certain distribution requirements. To qualify for treatment as a
regulated investment company, the Fund generally must, among other things (a)
derive in each taxable year at least 90% of its gross income from (i)
dividends, (ii) interest, (iii) payments with respect to securities loans,
(iv) gains from the sale or other disposition of stock or securities or
foreign currencies, and (v) other income derived with respect to its business
of investing in such stock, securities or currencies; and (b) derive in each
taxable year less than 30% of its gross income from gains (without deduction
for losses) from the sale or other disposition of securities held for less
than three months, and meet certain diversification requirements imposed
under the Code at the end of each quarter of the taxable year.
Dividends paid by the Fund will be taxable to shareholders as ordinary
income, except for (a) such portion as may exceed a shareholder's ratable
share of the Fund's earnings and profits, which excess will be applied
against and reduce the shareholder's cost or other tax basis for his shares,
and (b) amounts representing a distribution of net capital gains, if any,
which are designated by the Fund as capital gain distributions. If the amount
described in (a) above exceeds the shareholder's tax basis for his shares,
the excess over basis will be treated as gain from the sale or exchange of
such shares. The excess of any net long-term capital gains over net
short-term capital losses recognized and distributed by the Fund and
designated by the Fund as a capital gain distribution, will be taxable to
shareholders as a long-term capital gain regardless of the length of time a
particular shareholder may have held his shares in the Fund. Dividends and
distributions are taxable as described, whether received in cash or
reinvested in additional shares of the Fund.
Under certain circumstances, the sales charge incurred in acquiring shares
of the Fund may not be taken in account in determining the gain or loss on
the disposition of those shares. This rule applies where shares of the Fund
are disposed of within 90 days after the date on which they were acquired and
new shares of a regulated investment company are acquired without a sales
charge or at a reduced sales charge. In that case, the gain or loss realized
on the disposition will be determined by excluding from the tax basis of the
shares disposed all or a portion of the sales charge incurred in acquiring
those shares. This exclusion applies to the extent that the otherwise
applicable sales charge with respect to the newly acquired shares is reduced
as a result of the shareholder having incurred a sales charge initially. The
portion of the sales charge affected by this rule will be treated as a sales
charge paid for the new shares.
Distributions by the Fund reduce the net asset value of the Fund's shares.
Should a distribution reduce the net asset value of a share below a
shareholder's cost for the share, such a distribution nevertheless generally
would be taxable to the shareholder as ordinary income or long-term capital
gain, even though, from an investment standpoint, it may constitute a partial
return of capital. In particular, investors should be careful to consider the
tax implications of buying shares just prior to the declaration of a dividend
or distribution, but the dividend or distribution generally would be taxable
to them.
Some shareholders may be subject to withholding of Federal income tax on
dividends and redemption payments from the Fund ("backup withholding") at the
rate of 31%. Corporate shareholders and certain other shareholders specified
in the Code generally are exempt from such backup withholding. Generally,
shareholders subject to backup withholding will be (i) those for whom a
certified taxpayer identification number is not on file with the Fund, (ii)
those about whom notification has been received (either
10
<PAGE>
by the shareholder or the Fund) from the Internal Revenue Service that they
are subject to backup withholding or (iii) those who, to the Fund's
knowledge, have furnished an incorrect taxpayer identification number.
Generally, to avoid backup withholding, an investor must, at the time an
account is opened, certify under penalties of perjury that the taxpayer
identification number furnished is correct and that he or she is not subject
to backup withholding.
It is anticipated that the Fund will receive dividends from its
investments, in which case dividends paid by the Fund from net investment
income may qualify for the 70% corporate dividends received deduction, but
only to the extent that such income is derived from dividends of domestic
corporations.
The Code imposes a 4% nondeductible excise tax on a regulated investment
company, such as the Fund, if it does not distribute to its shareholders
during the calendar year an amount equal to at least 98% of the Fund's
capital gains net income for the 12-month period ending on October 31 of each
calendar year. In addition, an amount equal to any undistributed investment
company taxable income or capital gain net income from the previous calendar
year must also be distributed to avoid the excise tax. The excise tax is
imposed on the amount by which the regulated investment company does not meet
the foregoing distribution requirements. If the Fund has taxable income that
would be subject to the excise tax, the Fund generally intends to distribute
such income so as to avoid payment of the excise tax.
Under another provision of the Code, any dividend declared by the Fund to
shareholders of record in October, November, and December of any calendar
year will be deemed to have been received by, and will be taxable to
shareholders as of December 31 of such calendar year, provided that the
dividend is actually paid by the Fund before February 1 of the following
year.
Based on the foregoing, the Fund's policy is to distribute to its
shareholders at least 90% of net investment company taxable income, as
defined above and in the Code, and any net realized capital gains for each
year and, consistent therewith, to meet the distribution requirements of Part
I of subchapter m of the Code. The Fund intends to meet the other
requirements of Part I of subchapter m, including the requirements with
respect to diversification of assets and sources of income, so that the Fund
will continue to qualify as a regulated investment company. Because of the
requirements that less than 30% of the Fund's gross income must be derived
from gains from the sale or other disposition of securities held for less
than three months, the Fund may be restricted in the following activities,
all of which produce such gains: writing of options on securities which have
been held less than three months, writing of options which expire in less
than three months, and effecting closing purchase transactions with respect
to options which have been written less than three months prior to such
transactions.
Equity options written by the Fund (covered call options on portfolio
stock) will be subject to the provisions under Section 1234 of the Code. If
the Fund writes a call option, no gain is recognized upon its receipt of a
premium. If the option lapses or is closed out, any gain or loss is treated
as a short-term capital gain or loss. If a call option is exercised, any
resulting gain or loss is a short-term or long-term capital gain or loss
depending on the holding period of the underlying stock.
Many futures contracts entered into by the Fund and all listed non-equity
options written or purchased by the Fund (including covered call options
written on debt securities and options written or purchased on futures
contracts) will be governed by Section 1256 of the Code. Absent a tax
election to the contrary, gain or loss attributable to the lapse, exercise or
closing out of any such position will be treated as 60% long-term and 40%
short-term capital gain or loss, and on the last trading day of the Fund's
fiscal year (and, generally on October 31 for purposes of the 4% excise tax),
all outstanding Section 1256 positions will be marked to market (i.e. treated
as if such positions were closed out at their closing price on such day),
with any resulting gain or loss recognized as 60% long-term and 40%
short-term capital gain or loss. Under certain circumstances, entry into a
futures contract to sell a security may constitute a short sale for Federal
income tax purposes, causing an adjustment in the holding period of the
underlying security or a substantially identical security in the Fund's
portfolio.
Positions of the Fund which consist of at least one stock and at least one
stock option or other position with respect to a related security which
substantially diminishes the Fund's risk of loss with respect to such stock
could be treated as a "straddle" which is governed by Section 1092 of the
Code, the operation of which may cause deferral of losses, adjustments in the
holding periods of stock or securities and conversion of short-term capital
losses into long-term capital losses. An exception to these straddle rules
exists for any "qualified covered call options" on stock options written by
the Fund.
If the Fund invests in stock of certain passive foreign investment
companies, the Fund may be subject to U.S. Federal income taxation on a
portion of any "excess distribution" with respect to, or gain from the
disposition of, such stock. The tax would be determined by allocating such
distribution or gain ratably to each day of the Fund's holding period for the
stock. The distributions or gain so allocated to any taxable year of the
Fund, other than the taxable year of the excess distribution or disposition,
would be taxed to the Fund at the highest ordinary income rate in effect for
such year, and the tax would be further increased by an interest charge to
reflect the value of the tax deferral deemed to have resulted from the
ownership of the foreign company's stock. Any amount of distribution or gain
allocated to the taxable year of the distribution or disposition would be
included in the Fund's investment company taxable income and, accordingly,
would not be taxable to the Fund to the extent distributed by the Fund as a
dividend to its shareholders. The Fund may elect to mark to market (i.e.,
treat as if sold at their closing market price on same day), its investments
in passive foreign investment companies and avoid any tax and or interest
charge on excess distributions.
11
<PAGE>
The foregoing discussion of U.S. Federal income tax law relates solely to
the application of that law to U.S. persons, i.e., U.S. citizens and
residents and U.S. corporations, partnerships, trusts and estates. Each
shareholder who is not a U.S. person should consider the U.S. and foreign tax
consequences of ownership of shares of the Fund, including the possibility
that such a shareholder may be subject to a U.S. withholding tax at a rate of
31% (or at a lower rate under an applicable income tax treaty) on amounts
constituting ordinary income received by him or her, where such amounts are
treated as income from U.S. sources under the Code.
The Fund furnishes all shareholders, within 31 days after the end of the
calendar year, with information which is required by the Internal Revenue
Service for preparing federal income tax returns.
Investors are urged to consult their attorney or tax adviser regarding
specific questions as to Federal, foreign, state or local taxes.
Important Notice Regarding Taxpayer IRS Certification
Pursuant to IRS Regulations, the Fund may be required to withhold 31% of
all reportable payments including any taxable dividends, capital gains
distributions or share redemption proceeds, for an account which does not
have a taxpayer identification number or social security number and certain
required certifications. The Fund reserves the right to refuse to open an
account for any person failing to provide a taxpayer identification number
along with the required certifications.
The Fund furnishes all shareholders, within 31 days after the end of the
calendar year, with information which is required by the Internal Revenue
Service for preparing income tax returns.
Investors are urged to consult their attorney or tax adviser regarding
specific questions as to Federal, foreign, state or local taxes.
TAX SHELTERED RETIREMENT PLANS
Shares of the Fund and other Phoenix Funds may be offered in connection
with employer-sponsored 401(k) plans. National and its affiliates may provide
administrative services to these plans and to their participants, in addition
to the services that National and its affiliates provide to the Phoenix
Funds, and receive compensation therefor. For information on the terms and
conditions applicable to employee participation in such plans, including
information on applicable plan administrative charges and expenses,
prospective investors should consult the plan documentation and employee
enrollment information which is available from participating employers.
THE NATIONAL DISTRIBUTOR
Pursuant to an Underwriting Agreement, Phoenix Equity Planning
Corporation, ("PEPCO"), acts as the Underwriter of the Fund. PEPCO is an
indirect wholly-owned subsidiary of Phoenix Home Life Mutual Insurance
Company and an affiliate of National. As Underwriter, PEPCO conducts a
continuous offering pursuant to a "best efforts" arrangement requiring it to
take and pay for only such securities as may be sold to the public. Shares of
the Fund may be purchased through investment dealers who have sales
agreements with the Underwriter. During the fiscal years 1993, 1994, and
1995, purchasers of shares of the Fund paid aggregate sales charges of
$20,436, $92,395, and $149,157 respectively, of which the principal
underwriter received net commissions of $3,806, $12,138, and $22,744,
respectively, for it services, the balance being paid to dealers.
The Underwriting Agreement may be terminated at any time on not more than
60 days written notice, without payment of a penalty, by the Underwriter, by
vote of a majority of the outstanding voting securities of the Fund, or by
vote of a majority of the Fund's Trustees who are not "interested persons" of
the Fund and who have no direct or indirect financial interest in the
operation of the Distribution Plan or in any related agreements. The
Underwriting Agreement will terminate automatically in the event of its
assignment.
Dealers with whom the Underwriter has entered into sales agreements
receive sales charges in accordance with the commission table set forth in
the Prospectus. The Underwriter may from time to time pay, from its own
resources or pursuant to the Plan of Distribution described below, a bonus or
other incentive to dealers (other than the Underwriter) which employ a
registered representative who sells a minimum dollar amount of the shares of
the Fund during a specific period of time. Such bonus or other incentive may
take the form of payment for travel expenses, including lodging, incurred in
connection with trips taken by qualifying registered representatives and
members of their families to places within or without the United States or
other bonuses such as gift certificates or the cash equivalent of such
bonuses. The Underwriter may, from time to time, reallow the entire portion
of the sales charge which it normally retains to individual selling dealers.
However, such additional reallowance generally will be made only when the
selling dealer commits to substantial marketing support such as internal
wholesaling through dedicated personnel, internal communications and mass
mailings.
PLANS OF DISTRIBUTION
The Fund has adopted separate distribution plans under Rule 12b-1 of the
1940 Act for each class of shares of the Fund (the "Class A Plan", the "Class
B Plan", and collectively the "Plans"). The Plans permit the Fund to
reimburse the Underwriter for
12
<PAGE>
expenses incurred in connection with activities intended to promote the sale
of shares of each class of shares of the Fund. For fiscal year 1994, the
Underwriter has voluntarily agreed to limit the Rule 12b-1 fee for Class A
Shares to 0.25%.
Pursuant to the Class A Plan, the Fund may reimburse the Underwriter for
actual expenses of the Underwriter up to .30% of the average daily net assets
of the Fund's Class A Shares. Under the Class B Plan, the Fund may reimburse
the Underwriter monthly for actual expense of the Underwriter up to 1.00% of
the average daily net assets of the Fund's Class B Shares. Expenditures under
the Plans shall consist of: (i) commissions to sales personnel for selling
shares of the Fund (including underwriting fees and financing expenses
incurred in connection with the sale of Class B Shares); (ii) compensation,
sales incentives and payments to sales, marketing and service personnel;
(iii) payments to broker-dealers and other financial institutions which have
entered into agreements with the Underwriter in the form of the Dealer
Agreement for Phoenix Funds for services rendered in connection with the sale
and distribution of shares of the Fund; (iv) payment of expenses incurred in
sales and promotional activities, including advertising expenditures related
to the Fund; (v) the costs of preparing and distributing promotional
materials; (vi) the cost of printing the Fund's Prospectus and Statement of
Additional Information for distribution to potential investors; and (vii)
such other similar services that the Trustees of the Fund determines are
reasonably calculated to result in the sale of shares of the Fund; provided
however, a portion of such amount paid to the Distributor, which portion
shall be equal to or less than 0.25% annually of the average daily net assets
of the Fund shares may be paid for reimbursing the costs of providing
services to the shareholders, including assistance in connection with
inquiries related to shareholder accounts (the "Service Fee").
In order to receive payments under the Plans, participants must meet such
qualifications to be established in the sole discretion of the Underwriter,
such as services to the Fund's shareholders; or services providing the Fund
with more efficient methods of offering shares to coherent groups of clients,
members or prospects of a participant; or services permitting bulking of
purchases or sales, or transmission of such purchases or sales by
computerized tape or other electronic equipment; or other processing.
The fee received by the Underwriter under the early years of the Plans is
not likely to reimburse the Underwriter for the total distribution expenses
it will actually incur as a result of the Fund having fewer assets and the
Underwriter incurring greater promotional expenses during the start-up phase.
No amounts paid or payable by the Fund under the Plan for Class A Shares may
be used to pay for, or reimburse payment for, sales or promotional services
or activities unless such payment or reimbursement takes place prior to the
earliest of (a) the last day of the one year period commencing on the last
day of the calendar quarter during which the specific service or activity was
performed, or (b) the last day of the one year period commencing on the last
day of the calendar quarter during which payment for the services or activity
was made by a third party on behalf of the Fund. If the Plans are terminated
in accordance with their terms, the obligations of the Fund to make payments
to the Underwriter pursuant to the Plans will cease and the Fund will not be
required to make any payments past the date on which each Plan terminates.
In addition to the amount paid to dealers pursuant to the sales charge
table in the Prospectus, the Underwriter may from time to time pay, from its
own resources or pursuant to the Plans, a bonus or other incentive to dealers
(other than the Underwriter) which employ a registered representative who
sells a minimum dollar amount of the shares of the Fund during a specific
period of time. Such bonus or other incentive may take the form of payment
for travel expenses, including lodging, incurred in connection with trips
taken by qualifying registered representatives and members of their families
to places within or without the United States or other bonuses such as gift
certificates or the cash equivalent of such bonuses. The Underwriter may,
from time to time, reallow the entire portion of the sales charge on Class A
Shares which it normally retains to individual selling dealers. However, such
additional reallowance generally will be made only when the selling dealer
commits to substantial marketing support such as internal wholesaling through
dedicated personnel, internal communications and mass mailings.
For the fiscal year ended June 30, 1995 the Fund paid Rule 12b-1 Fees in
the amount of $336,175 of which the Underwriter received $68,521 and
unaffiliated broker-dealers received $267,654. The Rule 12b-1 payments were
used for (1) compensating dealers ($336,175).
On a quarterly basis, the Fund's Trustees review a report on expenditures
under the Plans and the purposes for which expenditures where made. The
Trustees conduct an additional, more extensive review annually in determining
whether the Plans will be continued. By its terms, continuation of the Plans
from year to year is contingent on annual approval by a majority of the
Fund's Trustees and by a majority of the Trustees who are not "interested
persons" (as defined in the 1940 Act) and who have no direct or indirect
financial interest in the operation of the Plans or any related agreements
(the "Plan Trustees"). The Plans provide that they may not be amended to
increase materially the costs which the Fund may bear pursuant to the Plans
without approval of the shareholders of the Fund and that other material
amendments to the Plans must be approved by a majority of the Plan Trustees
by vote cast in person at a meeting called for the purpose of considering
such amendments. The Plans further provides that while it is in effect, the
selection and nomination of Trustees who are not "interested persons" shall
be committed to the discretion of the Trustees who are not "interested
persons". The Plans may be terminated at any time by vote of a majority of
the Plan Trustees or a majority of the outstanding shares of the Fund. Under
the Class A Plan, reimbursement or payment of expenses may not be made unless
such payment or reimbursement occurs prior to the earliest of (a) the last
day of the one-year period commencing on the last day of the calendar quarter
during which payment for the service or activity was made by a third party
13
<PAGE>
on behalf of the Fund. The Class B Plan, however, does not limit the
reimbursement of distribution related expenses to expenses incurred in
specified time periods. The Underwriting Agreements may be terminated at any
time on not more than 60 days' written notice, without payment of a penalty,
by the Underwriter, by vote of a majority of the outstanding class of voting
securities of the Fund, or by vote of a majority of the Fund's Trustees.
The National Association of Securities Dealers (the "NASD"), recently
approved certain amendments to the NASD's mutual fund maximum sales charge
rule. The amendments would, under certain circumstances, regard distribution
fees to be asset-based sales charges subject to NASD sales load limits. An
amendment to the NASD's maximum sales charge rule may require the Trustees to
amend the Plan.
TRUSTEES AND OFFICERS
The following table sets forth information concerning the Trustees and
officers of the Fund, including their principal occupations during the past
five years. Unless otherwise noted, the address of each executive officer and
Trustee is One American Row, Hartford, Connecticut, 06115. On February 15,
1995, the Trustees voted to increase the number of Trustees from ten to
eleven and to appoint Lowell P. Weicker, Jr. to fill the vacancy caused by
the increase. The Trustees and executive officers are listed below:
<TABLE>
<CAPTION>
Positions Held Principal Occupations
Name and Address With the Fund During the Past 5 Years
- -------------------------- --------------- ----------------------------------------------------------
<S> <C> <C>
C. Duane Blinn Trustee Partner in the law firm of Day, Berry & Howard.
Day, Berry & Howard Director/Trustee, Phoenix Funds (1980-present).
CityPlace Director/Trustee, the National Affiliated Investment
Hartford, CT 06103 Companies (until 1993).
Robert Chesek Trustee Trustee/Director, Phoenix Funds (1981-present) and
49 Old Post Road Chairman (1989-1994). Director/Trustee, the National
Wethersfield, CT 06109 Affiliated Investment Companies (until 1993). Vice
President, Common Stock, Phoenix Home Life Mutual
Insurance Company (1980-1994).
E. Virgil Conway Trustee Trustee/Director, Consolidated Edison Company of New York,
9 Rittenhouse Road Inc. (1970-present), Pace University (1978-present),
Bronxville, NY 10708 Atlantic Mutual Insurance Company (1974-present), HRE
Properties (1989-present), Greater New York Councils, Boy
Scouts of America (1985-present), Union Pacific Corp.
(1978-present), Atlantic Reinsurance Company
(1986-present), Blackrock Fund for Fannie Mae Mortgage
Securities (Advisory Director) (1989-present), Centennial
Insurance Company, Josiah Macy, Jr., Foundation, and The
Harlem Youth Development Foundation. Board Member,
Metropolitan Transportation Authority (1992-present).
Chairman, Audit Committee of the City of New York
(1981-present). Director/Trustee, the National Affiliated
Investment Companies (until 1993). Director/Trustee,
Phoenix Funds (1993- present). Director, Accuhealth
(1994-present), Trism, Inc. (1994-present). Director,
Realty Foundation of New York (1972-present) and the New
York Housing Partnership Development Corp. (1981-present).
Advisory Director, Fund Directions (1993-present). Former
Director, New York Chamber of Commerce and Industry
(1974-1990).
14
<PAGE>
Positions Held Principal Occupations
Name and Address With the Fund During the Past 5 Years
- -------------------------- --------------- ----------------------------------------------------------
Harry Dalzell-Payne Trustee Director/Trustee, Phoenix Funds (1983-present). Director,
330 East 39th Street Farragut Mortgage Co., Inc. (1991-1994). Director/Trustee,
Apartment 29G the National Affiliated Investment Companies (1983-1993).
New York, NY 10022 Consultant, The Levett Group Holding, Inc. (1989-1990).
Independent real estate market consultant (1982-1990).
Formerly a Major General of the British Army.
Leroy Keith, Jr. Trustee Director/Trustee, Phoenix Funds (1980-present). Director
Chairman and Chief Equifax Corp. (1991-present), and Keystone International
Executive Officer Fund, Inc. (1989-present). Trustee, Keystone Liquid Trust,
Carson Products Company Keystone Tax Exempt Trust, Keystone Tax Free Fund, Master
64 Ross Road Reserves Tax Free Trust, and Master Reserves Trust.
Savannah, GA 31405 Director/Trustee, the National Affiliated Investment
Companies (until 1993). Director, Blue Cross/Blue Shield
(1989-1993) and First Union Bank of Georgia (1989-1993).
President, Morehouse College (1987-1994). Chairman and
Chief Executive Officer, Keith Ventures (1994-1995).
Chairman and Chief Executive Officer, Carson Products
Company (1995-present).
*Philip R. McLoughlin Trustee and Director (1994-present) and Executive Vice President,
President Investments, (1987-present), Phoenix Home Life Mutual
Insurance Company. Director/ Trustee and President,
Phoenix Funds (1989- present). Director (1983-present) and
Chairman (1995-present), Phoenix Investment Counsel, Inc.
Director (1984-present) and President (1990- present),
Phoenix Equity Planning Corporation. Director, Phoenix
Realty Group, Inc. (1994-present), Phoenix Realty
Advisors, Inc. (1987-present), Phoenix Realty Investors,
Inc. (1994-present), Phoenix Realty Securities, Inc.
(1994-present), Phoenix Founders, Inc. (1981-present),
PXRE Corporation (Delaware) (1985-present), Phoenix Re
Corporation (New York) (1985-1992), World Trust Fund
(1991-present). Director/Trustee, the National Affiliated
Investment Companies (until 1993). Director, Chairman and
Chief Executive Officer, National Securities & Research
Corporation (1993- present) and Director and President,
Phoenix Securities Group, Inc. (1993-present). Director
(1992-present) and President, W.S. Griffith & Co., Inc.
(1992-1994) and Director (1992-present) and President
(1992-1994) Townsend Financial Advisers, Inc.
(1992-present). Director and Vice President, PM Holdings,
Inc. (1985-present).
15
<PAGE>
Positions Held Principal Occupations
Name and Address With the Fund During the Past 5 Years
- -------------------------- --------------- ----------------------------------------------------------
James M. Oates Trustee Director/Trustee, Phoenix Funds (1987-present). Director,
Managing Director Govett Worldwide Opportunity Funds, Inc. (1991-present),
The Wydown Group and Stifel Financial Corporation (1986-present).
50 Congress Street Director/Trustee, the National Affiliated Investment
Suite 1000 Companies (until 1993). Director and President (1984-1994)
Boston, MA 02109 and Chief Executive Officer (1986-1994), Neworld Bank.
Director, Savings Bank Life Insurance Company (1988-1994).
Philip R. Reynolds Trustee Director/Trustee, Phoenix Funds (1984-present). Director,
43 Montclair Drive Vestaur Securities, Inc. (1972-present). Trustee and
West Hartford, CT 06107 Treasurer, J. Walton Bissell Foundation, Inc.
(1988-present). Director/Trustee, the National Affiliated
Investment Companies (until 1993).
Herbert Roth, Jr. Trustee Director/Trustee, Phoenix Funds (1980-present). Director,
134 Lake Street Boston Edison Company (1978-present), Phoenix Home Life
P.O. Box 909 Mutual Insurance Company (1972-present), Landauer, Inc.
Sherborn, MA 01770 (medical services) (1970-present), Tech Ops./Sevcon, Inc.
(electronic controllers) (1987-present), Key Energy Group
(oil rig service) (1988-1993), and Mark IV Industries
(diversified manufacturer) (1985-present). Director/
Trustee, the National Affiliated Investment Companies
(until 1993).
Richard E. Segerson Trustee Director/Trustee, Phoenix Funds, (1993-present).
102 Valley Road Consultant, Tootal Group (1989-1991). Vice President and
New Canaan, CT 06840 General Manager, Coats & Clark, Inc. (previously Tootal
American, Inc.) (1991-1993). Director/Trustee, the
National Affiliated Investment Companies (1984-1993).
Lowell P. Weicker, Jr. Trustee Trustee/Director, the Phoenix Funds (1995-present).
Dresing Lierman Weicker Chairman, Dresing, Lierman, Weicker (1995-present).
6931 Arlington Road Governor of the State of Connecticut (1991-1995).
Suite 501 President and Chief Executive Officer, Research! America
Bethesda, MD 20814 (1989-1990).
Martin J. Gavin Executive Senior Vice President, Investment Products, Phoenix Home
Vice President Life Mutual Insurance Company (1989-present). Director and
Executive Vice President, Phoenix Equity Planning
Corporation (1990-present). Executive Vice President,
Phoenix Investment Counsel, Inc. (1991- present). Director
and Executive Vice President, Phoenix Securities Group,
Inc. (1993-present), National Securities & Research
Corporation (1993-present), W.S. Griffith & Co., Inc.
(1993-present) and Townsend Financial Advisers, Inc.
(1993-present). Executive Vice President, Phoenix Funds
(1995-present). Executive Vice President, National
Affiliated Investment Companies (until 1993).
16
<PAGE>
Positions Held Principal Occupations
Name and Address With the Fund During the Past 5 Years
- -------------------------- --------------- ----------------------------------------------------------
Michael E. Haylon Executive Senior Vice President, Securities Investments, Phoenix
Vice President Home Life Mutual Insurance Company (1993-present).
Director and Executive Vice President (1994-present),
National Securities & Research Corporation. Executive Vice
President, Phoenix Funds (1995-present) and Director
(1994- present) and President (1995-present), Phoenix
Investment Counsel, Inc. Various other positions with
Phoenix Home Life Mutual Insurance Company (1990-1993).
James M. Dolan Vice President Vice President and Compliance Officer (1994- present), and
100 Bright Meadow Blvd. Assistant Secretary (1981-present), Phoenix Equity
P.O. Box 2200 Planning Corporation. Vice President, Phoenix Funds
Enfield, CT 06083-2200 (1989-present). Vice President (1991-present), Assistant
Clerk and Assistant Secretary (1982-present), Phoenix
Investment Counsel, Inc., Vice President and Chief
Compliance Officer (1994-present), Phoenix Realty
Advisors, Inc. and Chief Compliance Officer (1995-
present), Phoenix Realty Securities, Inc. Assistant Vice
President (1993-1994), Vice President and Compliance
Officer, Assistant Secretary, National Securities &
Research Corporation (1994-present). Vice President, the
National Affiliated Investment Companies (until 1993).
Various other positions with Phoenix Equity Planning
Corporation (1978-1994).
Jeanne H. Dorey Vice President Portfolio Manager, International, Phoenix Home Life Mutual
and Portfolio Insurance Company. Vice President National Securities &
Co-Manager Research Corporation, The Phoenix Edge Series Fund,
Phoenix Multi-Portfolio Fund, Phoenix Investment Counsel,
Inc. and Phoenix Worldwide Opportunities Fund
(1993-present).
William R. Moyer Vice President Vice President, Investment Products Finance, Phoenix Home
100 Bright Meadow Blvd. Life Mutual Insurance Company (1990-present). Senior Vice
P.O. Box 2200 President, Finance, Phoenix Equity Planning Corporation
Enfield, CT 06083-2200 (1990-present), and Phoenix Investment Counsel, Inc.
(1990- present). Vice President, Phoenix Funds (1990-
present). Senior Vice President, Finance, Phoenix
Securities Group, Inc. (1993-present), National Securities
& Research Corporation (1993-present), Senior Vice
President and Chief Financial Officer, W.S. Griffith &
Co., Inc. (1992-present) and Townsend Financial Advisers,
Inc. (1993-present). Vice President, the National
Affiliated Investment Companies (until 1993). Senior
Manager, Price Waterhouse (1983-1990).
17
<PAGE>
Positions Held Principal Occupations
Name and Address With the Fund During the Past 5 Years
- -------------------------- --------------- ----------------------------------------------------------
Leonard J. Saltiel Vice President Vice President, Investment Operations, Phoenix Home Life
Mutual Insurance Company (1994- present). Senior Vice
President, Phoenix Equity Planning Corporation
(1994-present). Vice President, Phoenix Funds
(1994-present) and National Securities & Research
Corporation. Various positions with Home Life Insurance
Company and Phoenix Home Life Mutual Insurance Company
(1987-1994).
John T. Wilson Vice President Portfolio Manager, Common Stock, Phoenix Home Life Mutual
and Portfolio Life Insurance Company (1990-present). Portfolio Manager,
Co-Manager The Phoenix Edge Series Fund- Growth Series (1992-present)
and Manager, Phoenix Multi-Portfolio Fund-Capital
Appreciation Portfolio (1995-present). Vice President
(1994-present), Phoenix Multi-Portfolio Fund, The Phoenix
Edge Series Fund and National Securities & Research
Corporation. Duke University Business School (1989-1990).
Nancy G. Curtiss Treasurer Second Vice President and Treasurer, Fund Accounting,
Phoenix Home Life Mutual Insurance Company (1994-present).
Treasurer, Phoenix Funds (1994-present). Vice President,
Fund Accounting, Phoenix Equity Planning Corporation
(1994-present). Various positions with Phoenix Home Life
Insurance Company (1987-1994).
C. Jeffrey Bohne Secretary Vice President and General Manager, Phoenix Home Life
101 Munson Street Mutual Insurance Co. (1993-present), Vice President,
Greenfield, MA 01301 Transfer Agent Operations, Phoenix Equity Planning
Corporation (1993-present). Secretary, the Phoenix Funds
(1993-present), Vice President, Home Life of New York
Insurance Company (1984-1992).
- --------------------------
</TABLE>
*Indicates that the Trustee is an "interested person" of the Trust within the
meaning of the definition set forth in Section 2(a)[F19] of the Investment
Company Act of 1940.
For services rendered to the Fund for the fiscal year ended June 30, 1995,
the Trustees receive aggregate remuneration of $28,715. For services on the
Boards of Directors/Trustees of the Phoenix Funds, each Trustee who is not a
full-time employee of the Adviser or any of its affiliates currently receives
a retainer at the annual rate of $30,000 and a fee of $2,000 per joint
meeting of the Boards. Each Trustee who serves on the Audit Committee
receives a retainer at the annual rate of $2,000 and a fee of $2,000 per
joint Audit Committee meeting attended. Each Trustee who serves on the
Nominating Committee receives a retainer at the annual rate of $1,000 and a
fee of $1,000 per joint Nominating Committee meeting attended. Each Trustee
who serves on the Executive Committee and who is not an interested person of
the Fund receives a retainer at the annual rate of $1,000 and $1,000 per
joint Executive Committee meeting attended. For services to the Fund only,
each Trustee who is not a full-time employee of the Adviser or any of its
affiliates receives a retainer at the annual rate of $3,000 and a fee of $200
per meeting attended; each Trustee who serves on the Audit Committee receives
a retainer at the annual rate of $200 and a fee of $200 per Audit Committee
meeting attended; each Trustee who serves on the Nominating Committee
receives a retainer at the annual rate of $100 and a fee of $1,000 per
Nominating Committee meeting attended; and each Trustee who serves on the
Executive Committee and who is not an interested person of the Fund receives
a retainer at the annual rate of $100 and $1,000 per joint Executive
Committee
18
<PAGE>
meeting attended. The foregoing fees do not include the reimbursement of
expenses incurred in connection with meeting attendance. Officers and
interested Trustees of the Fund are compensated for their services by the
Adviser and receive no compensation from the Fund.
For the Fund's last fiscal year ending June 30, 1995, the Trustees
received the following compensation:
<TABLE>
<CAPTION>
Total
Compensation
Pension or From Fund and
Aggregate Retirement Benefits Estimated Fund Complex
Compensation Accrued as Part Annual Benefits (10 Funds)
Name From Fund of Fund Expenses Upon Retirement Paid to Directors
- ----------------------- ---------- ------------------- ---------------- --------------------
<S> <C> <C> <C> <C>
C. Duane Blinn $2,000* $50,000
Robert Chesek $1,600 $40,000
E. Virgil Conway $2,040 $51,000
Harry Dalzell-Payne $1,680 $42,000
Leroy Keith, Jr. $1,680 None None $42,000
Philip R. McLoughlin $ 0 for any for any $ 0
James M. Oates $2,000 Trustee Trustee $50,000
Philip R. Reynolds $1,680 $42,000
Herbert Roth, Jr. $2,120* $53,000
Richard E. Segerson $2,000 $50,000
Lowell P. Weicker, Jr. $ 380 $ 9,500
</TABLE>
*This compensation (and the earnings thereon) was deferred pursuant to the
Trustees' Deferred Compensation Plan.
On June 30, 1995, the Trustees and officers of the Fund beneficially owned
less than 1% of the outstanding shares of the Fund.
ADVISORY BOARD
The Fund has an Advisory Board consisting of Messrs. Allan, Blakeley and
Palmer, former independent Trustees of the Fund. The Advisory Board,
consisting of retired Trustees, provides advice and counsel to the current
Trustees. They are scheduled to meet formally once in 1995 and to be
available for informal consultations during the same period. For each of
those years, the Fund will pay each Advisory Board member an annual stipend
of $2,500 and a meeting fee of $2,000. The following sets forth each Advisory
Board member's business affiliations for the past 5 years.
Lincoln W. Allan--Semi-retired commercial real estate investor. From 1988
to 1990, Mr. Allan was with Allmon & Tiernan, Inc. Mr. Allan is a former
Director/Trustee of the National Affiliated Investment Companies.
Gerald W. Blakeley, Jr.--Partner, Blakeley Investment Company, 60 State
Street, Boston, MA 02109. Prior to 1990, Mr. Blakeley was the Managing
Partner of Blakeley Maddox Investment Company. Mr. Blakeley is a former
Director/Trustee of the National Affiliated Investment Companies.
Edward L. Palmer--Mr. Palmer is the President of Mill Neck Group, Inc.,
339 Park Ave., Suite 2900, New York, NY 10043. Mr. Palmer is a Director of
Devon Group, Inc. and Lanxide Corporation. Mr. Palmer is a former
Director/Trustee of the National Affiliated Investment Companies.
OTHER INFORMATION
Custodian and Transfer Agent
Brown Brothers Harriman & Co., having its principal place of business at
40 Water Street, Boston, Massachusetts 02109, serves as custodian of the
Fund's assets (the "Custodian"). Equity Planning acts as Transfer Agent for
the Fund (the "Transfer Agent") and in connection therewith, is paid a fee of
$14.95 for each designated shareholder account.
Report to Shareholders
The fiscal year of the Fund ends on June 30. The Fund will send a semi-annual
report containing unaudited financial statements. to its shareholders. An annual
report, containing financial statements audited by independent accountants, will
be sent to shareholders each year, and is available without charge upon request.
19
<PAGE>
Financial Statements
The Financial Statements for the fiscal year ended June 30, 1995,
appearing in the Fund's 1995 Annual Report to Shareholders, are incorporated
herein by reference.
Independent Public Accountant
Price Waterhouse LLP serves as independent accountants for the Fund (the
"Accountants"). The Accountants audit the financial statements of the Fund.
20
<PAGE>
Phoenix Worldwide Opportunities Fund
SCHEDULE OF INVESTMENTS
June 30, 1995
<TABLE>
<CAPTION>
SHARES VALUE
--------- -------------
<S> <C> <C>
COMMON STOCKS--94.3%
Argentina--0.9%
Quilmes (Beverages) 62,000 $ 1,209,000
------------
Australia--2.1%
Australia & New Zealand Banking Group
(Banks) 350,000 1,240,519
News Corp. (Publishing, Broadcasting
& Printing) 262,000 1,459,786
------------
2,700,305
------------
Austria--1.8%
Austria Mikro Systeme International
AG (Electronics) 12,000 1,578,023
Flughafen Wien (Business & Public
Services) 14,000 745,040
------------
2,323,063
------------
Belgium--1.0%
Kredietbank NV (Banks) 5,300 1,259,005
------------
Canada--0.9%
Gandalf Technologies, Inc. (Computer
Software & Services) 125,000 1,132,812
------------
Chile--1.3%
Compania de Telefonos de Chile ADR
(Utility--Telephone) 20,000 1,627,500
------------
Denmark--0.5%
Unidanmark (Banks) 14,100 691,816
------------
Finland--2.5%
Benefon OY (Electronics) 54,800 2,075,418
Nokia AB (Telecommunications
Equipment) 20,000 1,168,907
------------
3,244,325
------------
France--4.7%
Castorama Dubois (Retail) 3,700 613,677
Christian Dior SA (Retail) 6,500 572,831
Legrand (Electrical Equipment) 4,700 746,570
LVMH (Beverages) 8,000 1,440,743
Total Compagnie Francaise des
Petroles (Oil) 25,000 1,505,931
Valeo (Auto & Truck Parts) 25,000 1,216,607
------------
6,096,359
------------
Germany--6.9%
Buderus AG (Building & Materials) 700 336,320
Commerzbank AG (Banks) 5,400 1,290,600
Fresenius AG (Medical Technology) 2,200 1,482,986
Gehe AG (Health Care--Drugs) 2,900 1,330,467
Moebel Walther AG (Household
Furnishings & Appliances) 2,750 1,390,795
Standard Application Software
AG--Vorzug (Computer Software
& Services) 2,510 3,159,942
------------
8,991,110
------------
Hong Kong--6.4%
CDL Hotels International
(Lodging & Restaurants) 2,500,000 $1,219,709
Consolidated Electric Power Asia
(Utility--Electric) 770,000 1,786,300
Dao Heng Bank Group, Ltd. (Banks) 200,000 610,016
First Pacific Company Ltd.
(Conglomerates) 1,720,000 1,522,714
HSBC Holdings plc (Banks) 122,000 1,564,911
Hutchison Whampoa (Conglomerates) 138,000 667,037
Sun Hung Kai Properties (Property
Development) 125,000 924,879
------------
8,295,566
------------
Indonesia--2.1%
Astra International (Auto & Truck
Parts) 369,000 654,490
Indonesia Satellite (Indosat)
(Utility--Telephone) 39,400 1,507,050
Wicaksana Overseas (International
Trade ) 220,000 617,423
------------
2,778,963
------------
Italy--0.5%
Telecom Italia (Utility--Telephone) 232,000 628,540
------------
Japan--4.8%
Mitsui Marine & Fire Insurance
(Insurance ) 82,000 537,009
Murata Manufacturing (Electronics) 17,000 642,757
Nippon Steel (Metals & Mining) 72,000 234,064
Nippon Telegraph & Telephone
(Utility--Telephone) 75 627,209
Omron Corp. (Electronics) 45,000 858,658
Oriental Construction Co.
(Construction) 30,000 628,976
Rohm Co. (Electronics) 15,000 773,853
Sankyo Co. (Health Care--Diversified) 23,300 540,648
Shohkoh Fund & Co. (Financial
Services) 7,400 1,324,854
------------
6,168,028
------------
Korea--1.1%
Samsung Electronics (Electronics) 27,200 1,414,400
------------
Malaysia--0.4%
Magnum Corporation (Entertainment,
Leisure & Gaming) 140,000 327,331
Technology Resources Industries
(Utility--Telephone) 61,000 175,151
------------
502,482
------------
See Notes to Financial Statements
3
<PAGE>
Phoenix Worldwide Opportunities Fund
Netherlands--6.1%
Ahrend Group NV (Office & Business
Equipment) 9,500 $ 1,252,983
Cap Volmac Software NV (Computer
Software & Services) 100,000 1,522,090
Getronics NV (Computer Software &
Services) 15,000 734,279
IHC Caland NV (Oil Service &
Equipment) 50,000 1,418,897
Polygram NV (Entertainment, Leisure &
Gaming) 2,300 135,730
Sphinx Kon CVA (Building & Materials) 41,683 1,489,351
VNU (Publishing, Broadcasting &
Printing) 11,000 1,316,027
------------
7,869,357
------------
Norway--3.0%
Nera AS (Telecommunications
Equipment) 25,000 709,651
Petroleum Geo-Services (Oil Service &
Equipment) (b) 60,000 1,725,000
Uni Storebrand (Insurance) 318,000 1,428,808
------------
3,863,459
------------
Peru--1.0%
CPT (Utility--Telephone) 775,013 1,322,429
------------
Philippines--1.0%
Metropolitan Bank & Trust Co. (Banks) 60,000 1,303,837
------------
Singapore--1.7%
City Development Ltd. (Property
Development) 86,000 526,154
Development Banks of Singapore
(Banks) 131,000 1,490,447
United Overseas Bank Ltd. (Banks) 25,200 238,025
------------
2,254,626
------------
South Africa--1.4%
De Beers Consolidated Mines, Ltd.
(Metals & Mining) 70,000 1,811,250
------------
Spain--2.2%
Centros Comerciales Continente SA
(Retail) 63,500 1,526,014
Repsol SA (Oil) 40,000 1,258,568
------------
2,784,582
------------
Sweden--4.0%
Allgon AB (Telecommunications
Equipment) 55,000 1,306,718
Astra AB (Health Care--Drugs) 44,000 1,356,570
Autoliv AB (Auto & Truck Parts) 32,000 1,709,514
SKF AB (Miscellaneous) 42,200 851,928
------------
5,224,730
------------
Switzerland--4.6%
Brown Boveri & Cie (Electrical
Equipment) 1,500 1,551,949
Roche Holdings (Health Care--
Diversified) 220 1,416,891
Sandoz AG (Health Care--Diversifed) 1,900 1,309,435
Winterthur Insurance Co. (Insurance) 2,700 1,621,734
------------
5,900,009
------------
Thailand--2.5%
Alphatec Electronics Co. (Electrical
Equipment) 105,000 1,914,118
Bangkok Bank Company Ltd. (Banks) 53,800 592,813
PTT Exploration & Production (Oil) 72,500 781,244
------------
3,288,175
------------
United Kingdom--8.5%
Allied Irish Banks plc (Banks) 246,000 1,166,396
British Sky Broadcasting Group plc
(Publishing, Broadcasting, Printing &
Cable) 110,000 480,429
Carlton Communications (Publishing &
Broadcasting) 102,000 1,546,635
Glaxo Welcome plc (Health
Care--Drugs) 104,000 1,276,630
Granada Group (Entertainment, Leisure
& Gaming) 116,000 1,122,164
Lonrho plc (Conglomerates) 455,000 1,071,440
Next plc (Retail) 220,000 1,195,386
Smithkline Beecham plc (Health
Care--Diversified) 38,000 1,719,500
Takare (Hospital Management &
Services) 444,000 1,356,372
------------
10,934,952
------------
United States--20.4%
Adtran, Inc. (Telecommunications
Equipment) (b) 61,000 2,043,500
AMR Corp. (Airlines) (b) 25,000 1,865,625
Ascend Communications, Inc.
(Telecommunications Equipment) (b) 40,000 2,020,000
Biogen, Inc. (Health Care--Drugs) (b) 40,000 1,780,000
Boston Chicken (Lodging &
Restaurants) (b) 100,000 2,418,750
Centex Corp. (Building & Materials) 65,000 1,836,250
Dean Witter Discover & Co. (Financial
Services) 48,000 2,256,000
Engelhard Corp. (Chemical--Specialty) 35,000 1,500,625
Evergreen Media Corp. (Publishing,
Broadcasting, Printing & Cable) (b) 100,000 2,600,000
Komag, Inc. (Office & Business
Equipment) (b) 40,000 2,080,000
Oak Technology, Inc. (Computer
Software & Services) (b) 80,000 2,940,000
Qualcomm, Inc. (Telecommunications
Equipment) (b) 50,000 1,728,125
VLSI Technology, Inc. (Electronics) (b) 45,000 1,355,625
------------
26,424,500
------------
TOTAL COMMON STOCKS
(Identified cost $109,247,593) 122,045,180
------------
</TABLE>
See Notes to Financial Statements
4
<PAGE>
Phoenix Worldwide Opportunities Fund
<TABLE>
<CAPTION>
STANDARD
& POOR'S PAR
RATING VALUE
(UNAUDITED) (000) VALUE
--------- ------- -------------
<S> <C> <C> <C>
SHORT-TERM OBLIGATIONS--5.1%
Commercial Paper
U.S.--2.2%
TDK USA 5.97%, 7-20-95 A-1+ $2,830 $ 2,821,083
------------
Federal Agency Securities--2.9%
Federal Home Loan Banks 6.05%,
7-3-95 3,715 3,713,751
------------
TOTAL SHORT-TERM OBLIGATIONS
(Identified cost $6,534,834) 6,534,834
------------
TOTAL INVESTMENTS--99.4%
(Identified cost $115,782,427) 128,580,014(a)
Cash and receivables, less liabilities--0.6% 750,297
------------
NET ASSETS--100.0% $129,330,311
============
</TABLE>
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $13,991,791 and gross
depreciation of $1,273,861 for federal income tax purposes. At June 30, 1995,
the aggregate cost of securities for federal income tax purposes was
$115,862,084.
(b) Non-income producing.
ADR--American Depository Receipt
See Notes to Financial Statements
5
<PAGE>
Phoenix Worldwide Opportunities Fund
INDUSTRY DIVERSIFICATION
As a percentage of Total Value of Common Stock
<TABLE>
<CAPTION>
<S> <C>
Airlines 1.5%
Auto & Truck Parts 2.9
Banks 9.4
Beverages 2.2
Building & Materials 3.0
Business & Public Services 0.6
Chemical Specialty 1.2
Computer Software & Services 7.8
Conglomerates 2.7
Construction 0.5
Electrical Equipment 3.5
Electronics 7.1
Entertainment, Leisure & Gaming 1.3
Financial Services 2.9
Health Care--Diversified 4.1
Health Care--Drugs 4.7
Hospital Management & Services 1.1
Household Furnishings & Appliances 1.1
Insurance 2.9
International Trade 0.5
Lodging & Restaurants 3.0
Medical Technology 1.2
Metals & Mining 1.7
Miscellaneous 0.7
Office & Business Equipment 2.7
Oil and Oil Services & Equipment 5.5
Property Development 1.2
Publishing, Broadcasting, Printing & Cable 6.1
Retail 3.2
Telecommunications Equipment 7.4
Utility--Electricity 1.5
Utility--Telephone 4.8
-----
100.0%
=====
</TABLE>
See Notes to Financial Statements
6
<PAGE>
Phoenix Worldwide Opportunities Fund
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Assets
Investment securities at value
(Identified cost $115,782,427) $128,580,014
Foreign currency at value
(Identified cost $1,283,302) 1,289,412
Cash 2,962
Receivables
Investment securities sold 4,739,017
Fund shares sold 98,621
Dividends and interest 355,632
Tax reclaim 27,022
------------
Total assets 135,092,680
------------
Liabilities
Payables
Investment securities purchased 4,761,210
Fund shares repurchased 189,978
Investment advisory fee 79,951
Distribution fee 28,379
Financial agent fee 3,198
Transfer agent fee 32,582
Trustees' fee 2,458
Accrued expenses 179,190
Net unrealized depreciation on forward currency
contracts 485,423
------------
Total liabilities 5,762,369
------------
Net Assets $129,330,311
============
Net Assets Consist of:
Capital paid in on shares of beneficial interest $121,463,951
Distributions in excess of net investment income (870,783)
Accumulated net realized losses (3,593,517)
Net unrealized appreciation 12,330,660
------------
Net Assets $129,330,311
============
Class A
Shares of beneficial interest outstanding, $1 par
value, unlimited authorization (Net Assets
$126,480,836) 13,985,314
Net asset value per share $9.04
Offering price per share
$9.04/(1-4.75%) $9.49
Class B
Shares of beneficial interest outstanding, $1 par
value, unlimited authorization (Net Assets
$2,849,475) 317,303
Net asset value and offering price per share $8.98
</TABLE>
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1995
<TABLE>
<CAPTION>
<S> <C>
Investment income
Dividends (net of $148,997 foreign withholding
tax) $1,521,243
Interest 1,021,384
----------
Total investment income 2,542,627
----------
Expenses
Investment advisory fee 972,771
Distribution fee--Class A 320,285
Distribution fee--Class B 15,890
Financial agent fee 38,911
Transfer agent 418,739
Custodian 229,347
Printing 107,886
Registration 73,544
Professional 74,506
Trustees 23,715
Miscellaneous 73,305
----------
Total expenses 2,348,899
----------
Net investment income 193,728
----------
Net Realized and Unrealized Gain (Loss) on Investments
Net realized gain on securities 398,910
Net realized loss on foreign currency transactions (935,057)
Net unrealized appreciation on investments 7,782,551
Net unrealized depreciation on foreign currency
transactions (340,883)
----------
Net gain on investments 6,905,521
----------
Net increase in net assets resulting from
operations $7,099,249
==========
</TABLE>
See Notes to Financial Statements
7
<PAGE>
Phoenix Worldwide Opportunities Fund
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Year Year
Ended Ended
June 30, 1995 June 30, 1994
------------ -------------
<S> <C> <C>
From Operations
Net investment income $ 193,728 $ 102,592
Net realized (loss) gain (536,147) 25,458,203
Net unrealized appreciation (depreciation) 7,441,668 (2,334,064)
----------- ------------
Increase in net assets resulting from operations 7,099,249 23,226,731
----------- ------------
From Distributions to Shareholders
Net investment income--Class A -- (318,807)
Net realized gains--Class A (18,002,670) --
Net realized gains--Class B (246,667) --
Distributions in excess of net realized gains--Class A (4,263,176) --
Distributions in excess of net realized gains--Class B (58,340) --
----------- ------------
Decrease in net assets from distributions to shareholders (22,570,853) (318,807)
----------- ------------
From Share Transactions
Class A
Proceeds from sales of shares (5,285,785 and 2,206,814 shares, respectively) 52,416,520 22,968,436
Net asset value of shares issued from reinvestment of distributions
(2,202,325 and 23,434 shares, respectively) 18,851,905 250,044
Cost of shares repurchased (5,169,653 and 1,672,871 shares, respectively) (48,268,641) (16,289,821)
----------- ------------
Total 22,999,784 6,928,659
----------- ------------
Class B
Proceeds from sales of shares (348,307 and 0 shares, respectively) 3,376,929 --
Net asset value of shares issued from reinvestment of distributions (25,057
and 0 shares, respectively) 213,734 --
Cost of shares repurchased (56,061 and 0 shares, respectively) (495,588) --
----------- ------------
Total 3,095,075 --
----------- ------------
Increase in net assets from share transactions 26,094,859 6,928,659
----------- ------------
Net increase in net assets 10,623,255 29,836,583
Net Assets
Beginning of period 118,707,056 88,870,473
----------- ------------
End of period (including distributions in excess of net investment income of
($870,783) and ($374,475), respectively) $129,330,311 $118,707,056
=========== ============
</TABLE>
See Notes to Financial Statements
8
<PAGE>
Phoenix Worldwide Opportunities Fund
FINANCIAL HIGHLIGHTS
(Selected data for a share outstanding throughout the indicated period)
<TABLE>
<CAPTION>
Class A Class B
--------------------------------------------------- -----------
From
Inception
Year Ended June 30, 7/15/94 to
1995 1994 1993 1992 1991 6/30/95
-------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period $10.17 $8.00 $7.18 $6.82 $7.56 $10.40
Income from investment
operations:
Net investment income (loss) 0.01(3) 0.01 0.03 0.01(2) 0.23(1) (0.02)(3)
Net realized and unrealized
gain (loss) 0.56 2.19 0.79 0.36 (0.67) 0.30
------- ------- ------ ------- ------- ----------
Total from investment
operations 0.57 2.20 0.82 0.37 (0.44) 0.28
------- ------- ------ ------- ------- ----------
Less distributions:
Dividends from net investment
income -- (0.03) -- (0.01) (0.30) --
Dividends from net realized
gains (1.37) -- -- -- -- (1.37)
In excess of net realized
gains (0.33) -- -- -- -- (0.33)
------- ------- ------ ------- ------- ----------
Total distributions (1.70) (0.03) -- (0.01) (0.30) (1.70)
------- ------- ------ ------- ------- ----------
Change in net asset value (1.13) 2.17 0.82 0.36 (0.74) (1.42)
------- ------- ------ ------- ------- ----------
Net asset value, end of period $ 9.04 $10.17 $8.00 $7.18 $6.82 $8.98
======= ======= ====== ======= ======= ==========
Total return( (4)) 6.53% 27.46% 11.42% 5.43% -5.27% 3.54%(5)
Ratios/supplemental data:
Net assets, end of period
(thousands) $126,481 $118,707 $88,870 $63,354 $59,874 $2,849
Ratio to average net assets
of:
Operating expenses 1.80% 1.50% 1.88% 2.15(2) 1.75(1) 2.61%(6)
Net investment income 0.16% 0.09% 0.61% 0.16% 3.46% (0.33)%(6)
Portfolio turnover 277% 259% 95% 51% 76% 277%
</TABLE>
(1) Net investment income would have been $.22 and the ratio of operating
expenses to average net assets would have been 1.89% for the year ended June
30, 1991, had the Manager not reimbursed a portion of its management fees,
pursuant to the then applicable expense limitations.
(2) Net investment income would have been the same $.01 and the ratio of
operating expenses to average net assets would have been 2.18% for the year
ended June 30, 1992, had the subadviser not reimbursed a portion of its
management fees.
(3) Computed using the monthly average number of shares outstanding during
the period.
(4) Maximum sales load is not reflected in the total return calculation
(5) Not annualized
(6) Annualized
See Notes to Financial Statements
9
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
NOTES TO FINANCIAL STATEMENTS
June 30, 1995
1. SIGNIFICANT ACCOUNTING POLICIES
Phoenix Worldwide Opportunities Fund ("the Fund") is organized as a
Massachusetts business trust and is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company. The Fund offers both Class A and Class B shares. Class A shares are
sold with a front-end sales charge of up to 4.75%. Class B shares are sold
with a contingent deferred sales charge which declines from 5% to zero
depending on the period of time the shares are held. Both classes of shares
have identical voting, dividend, liquidation and other rights and the same
terms and conditions, except that each class bears different distribution
expenses and has exclusive voting rights with respect to its distribution
plan. Income and expenses of the Fund are borne pro rata by the holders of
both classes of shares, except that each class bears distribution expenses
unique to that class.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
A. Security valuation:
Securities listed or traded on a national securities exchange or foreign
exchange are valued at the last sale price, or if there had been no sale of
the security on that day, at the mean between the last bid and asked prices,
and if no active market exists, at the bid price. Short-term investments
having a remaining maturity of less than sixty days are valued at amortized
cost which approximates market. All other securities and assets are valued at
their fair value as determined in good faith by or under the direction of the
Trustees.
B. Security transactions and related income:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date, or in the case of certain foreign
securities, as soon as the Fund is notified. Realized gains and losses from
investment transactions are reported on the identified cost basis.
C. Income taxes:
It is the policy of the Fund to comply with the requirements of the Internal
Revenue Code (the "Code"), applicable to regulated investment companies, and
to distribute substantially all of its taxable income to its shareholders. In
addition, the Fund intends to distribute an amount sufficient to avoid
imposition of any excise tax under Section 4982 of the Code. Therefore, no
provision for federal income taxes or excise taxes has been made.
D. Distributions to shareholders:
Distributions to shareholders are recorded on the ex-dividend date. Income
and capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences include the treatment of non-taxable dividends, expiring
capital loss carryforwards, foreign currency gain/loss, partnerships, and
losses deferred due to wash sales and excise tax regulations. Permanent book
and tax basis differences relating to shareholder distributions will result
in reclassifications to paid in capital.
E. Foreign currency translation:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at
the date of settlement. The gain or loss resulting from a change in currency
exchange rates between the trade and settlement dates of a portfolio
transaction, is treated as a gain or loss on foreign currency. Likewise, the
gain or loss resulting from a change in currency exchange rates, between the
date income is accrued and paid, is treated as a gain or loss on foreign
currency. The Fund does not separate that portion of the results of
operations arising from changes in exchange rates and that portion arising
from changes in the market prices of securities.
F. Forward currency contracts:
The Fund may enter into forward currency contracts in conjunction with the
planned purchase or sale of foreign denominated securities in order to hedge
the U.S. dollar cost or proceeds and to manage the Fund's currency exposure.
Forward currency contracts involve, to varying degrees, elements of market
risk in excess of the amount recognized in the statement of assets and
liabilities. Risks arise from the possible movements in foreign exchange
rates.
A forward currency contract involves an obligation to purchase or sell a
specific currency at a future date, which may be any number of days from the
date of the contract agreed upon by the parties, at a price set at the time
of the contract. These contracts are traded directly between currency traders
and their customers. The contract is marked-to-market daily and the change
in market value is recorded by the Fund as an unrealized gain (or loss). When
the contract is closed, the Fund records a realized gain (or loss) equal to
the change in the value of the contract when it was opened and the value at
the time it was closed.
10
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
NOTES TO FINANCIAL STATEMENTS
June 30, 1995 (Continued)
2. INVESTMENT ADVISORY FEES AND RELATED PARTY TRANSACTIONS
As compensation for its services to the Fund, the Investment Adviser,
National Securities and Research Corporation, an indirect wholly-owned
subsidiary of Phoenix Home Life Mutual Insurance Company ("PHL"), is entitled
to a fee at an annual rate of 0.75% of the average daily net assets of the
Fund for the first $1 billion.
As Distributor of the Fund's shares, Phoenix Equity Planning Corp.
("PEPCO"), an indirect wholly-owned subsidiary of PHL, has advised the Fund
that it received selling commissions of $15,350 for Class A shares and
deferred sales charges of $7,394 for Class B shares for the year ended June
30, 1995. In addition, the Fund pays PEPCO a distribution fee at an annual
rate of 0.25% for Class A shares and 1.00% for Class B shares of the average
daily net assets of the Fund. The Distribution Plan for Class A shares
provides for fees to be paid up to a maximum on an annual basis of 0.30%; the
Distributor has voluntarily agreed to limit the fee to 0.25%. The Distributor
has advised the Fund that of the total amount expensed for the year ended
June 30, 1995, $68,521 was earned by the Distributor and $267,654 was earned
by unaffiliated participants.
As Financial Agent of the Fund, PEPCO receives a fee at an annual rate of
0.03% of the average daily net assets of the Fund for bookkeeping,
administration and pricing services. PEPCO serves as the Fund's Transfer
Agent with State Street Bank and Trust Company as sub-transfer agent. For the
year ended June 30, 1995, transfer agent fees were $418,739 of which PEPCO
retained $146,583 which is net of the fees paid to State Street.
At June 30, 1995, PHL and affiliates held 148 Class A shares and 1 Class B
share of the Fund with a combined value of $1,347.
3. PURCHASE AND SALE OF SECURITIES
Portfolio purchases and sales of investments, excluding short-term
securities, for the year ended June 30, 1995, aggregated $320,090,046 and
$292,364,818, respectively. There were no purchases or sales of long-term
U.S. Government securities.
4. FORWARD CURRENCY CONTRACTS
As of June 30, 1995, the Fund had entered into the following forward
currency contracts which contractually obligate the Fund to deliver currencies
at specified dates:
<TABLE>
<CAPTION>
Net
Contracts In Unrealized
to Exchange Settlement Appreciation
Deliver For Date Value (Depreciation)
-------------- ------------ --------- ---------- -------------
<S> <C> <C> <C> <C>
AUD 1,500,000 USD 1,089,000 8/1/95 $1,060,431 $ 28,569
FRF 32,500,000 USD 6,279,950 9/1/95 6,679,471 (399,521)
YEN 460,000,000 USD 5,369,441 9/1/95 5,464,156 (94,715)
SEK 13,200,000 USD 1,809,186 7/3/95 1,812,455 (3,269)
SEK 48,700,000 USD 6,653,460 8/1/95 6,674,611 (21,151)
USD 1,830,841 SEK 13,200,000 7/3/95 1,812,455 (18,386)
USD 1,344,287 SEK 9,900,000 8/1/95 1,356,851 12,564
USD 1,195,603 SEK 8,800,000 8/1/95 1,206,089 10,486
-------------
$(485,423)
=============
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
AUD = Australian Dollar
FRF = French Franc
SEK = Swedish Krona
USD = U.S. Dollar
YEN = Japanese Yen
</TABLE>
5. RECLASS OF CAPITAL ACCOUNTS
The Fund has recorded several reclassifications in the capital accounts.
These reclassifications have no impact on the net asset value of the Fund and
are designed generally to present undistributed income and realized gains on
a tax basis which is considered to be more informative to the shareholder.
For the year ended June 30, 1995, the Fund has decreased capital paid in on
shares of beneficial interest by $4,346,354, and increased distributions in
excess of net investment income by $690,036 and decreased accumulated net
realized losses by $5,036,390.
6. POST-OCTOBER LOSS CARRYOVERS
Under current tax law, net capital losses and net foreign currency losses
realized after October 31, 1994 may be deferred and treated as occurring on
the first day of the following fiscal year. For the year ended June 30, 1995,
the Fund elected to defer $3,593,517 of net capital losses and $1,256,542 of
net foreign currency losses occurring between November 1, 1994 and June 30,
1995.
TAX INFORMATION NOTICE (UNAUDITED)
For the fiscal year ended June 30, 1995, the Fund distributed long-term
capital gains dividends of $8,230,420.
11
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
To the Trustees and Shareholders of
Phoenix Worldwide Opportunities Fund
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Phoenix Worldwide
Opportunities Fund (the "Fund") at June 30, 1995, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended and the financial highlights for each
of the periods indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Fund's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. We believe that our audits,
which included confirmation of securities at June 30, 1995 by correspondence
with the custodian and brokers, and the application of alternative auditing
procedures where confirmations from brokers were not received, provide a
reasonable basis for the opinion expressed above.
[Price Waterhouse Signature]
Boston, Massachusetts
August 10, 1995
12
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
PART C--OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Included in Part A: Financial Highlights (to be updated by amendment)
Included in Part B: Financial Statements and Notes thereto, and Report of
Independent Accountants are included in the Annual
Report to Shareholders for the year ended June 30, 1995,
incorporated by reference (to be updated by amendment)
(b) Exhibits:
1.1 Declaration of Trust of the Registrant, previously filed, and herein
incorporated by reference.
1.2 Amendment to Declaration of Trust designating Classes of Shares, filed
herewith and incorporated herein by reference.
2.1 By-laws of the Registrant, previously filed, and herein incorporated by
reference.
3. Not Applicable.
4. Reference is made to Article V of Registrant's Declaration of Trust, as
amended, and filed with the Registration Statement referred to in Exhibit
1.1.
5.1 Management Agreement between Registrant and National Securities &
Research Corporation dated May 14, 1993, previously filed, and herein
incorporated by reference.
5.2 Amendment to Management Agreement between Registrant and National
Securities & Research Corporation, dated January 1, 1994, filed herewith
and incorporated herein by reference.
6.1 Underwriting Agreement between Registrant and Phoenix Equity Planning
Corporation ("Equity Planning") dated May 14, 1993, previously filed, and
herein incorporated by reference.
6.2 Form of Underwriting Agreement for Class B Shares between Registrant and
Equity Planning, previously filed and incorporated herein by reference.
7. None.
8. Custody Agreement between Registrant and Brown Brothers Harriman & Co. dated
August 11, 1994, previously filed and incorporated herein by reference.
9.1 Transfer Agency and Service Agreement between Registrant and Phoenix
Equity Planning Corporation dated June 1, 1994, previously filed and
incorporated herein by reference.
9.2 Form of Sales Agreement, previously filed and incorporated herein by
reference.
10. Opinion as to legality of the shares, filed herewith and incorporated
herein by reference.
11. Consent of Independent Accountant, filed herewith and incorporated by
reference.
12. Not applicable.
13. None
14. None.
15.1 Distribution Plan dated May 14, 1993, previously filed, and herein
incorporated by reference.
15.2 Form of Distribution Plan for Class B Shares, previously filed,
incorporated herein by reference.
16. Schedule for computation of total return, previously filed, and
incorporated herein by reference.
17. Financial Data Schedule filed herewith and reflected on EDGAR as Exhibit
27.
18. Powers of attorney filed herewith and powers of attorney previously filed
with Post-Effective Amendment 59 on May 4, 1994 and with Post-Effective
Amendment 60 on October 26, 1994, respectively and incorporated herein by
reference.
C-1
<PAGE>
Item 25. Persons Controlled by or Under Common Control With Registrant
No person is controlled by, or under common control, with the
Registrant.
Item 26. Number of Holders of Securities
As of September 30, 1995, the number of record holders of each class
of securities of the Registrant was as follows:
Title of Class Number of Record-holders
Shares of Beneficial Interest--Class A 12,217
Shares of Beneficial Interest--Class B 125
Item 27. Indemnification
Registrant's indemnification provision is set forth in
Post-Effective Amendment No. 58 filed with the Securities and
Exchange Commission on June 30, 1993, and is incorporated herein by
reference.
Item 28. Business and Other Connections of Investment Adviser
See "Management of the Fund" in the Prospectus and "Services of the
Adviser" and "Trustees and Officers" of the Statement of Additional
Information which is included in this Post-Effective Amendment.
The directors and officers of National Securities & Research
Corporation (the "Adviser") and their business and other connections
are as follows:
<TABLE>
<CAPTION>
Positions with
Name Investment Adviser Other Vocation or Employment
------------------------ -------------------------- ------------------------------------------------------
<S> <C> <C>
Robert W. Fiondella Director Chairman of the Board, President and Chief Executive
Officer, Phoenix Home Life Mutual Insurance Company.
Director, Phoenix Equity Planning Corporation, Phoenix
Investment Counsel, Inc., Phoenix Securities Group,
Inc., Phoenix Realty Advisors, Inc., Phoenix Realty
Investors, Inc., Phoenix Realty Securities, Inc.,
Phoenix Realty Group, Inc., and Townsend Financial
Advisers, Inc. Director and Vice President of PM
Holdings, Inc.
Martin J. Gavin Director and Executive Senior Vice President, Investment Products, Phoenix
Vice President Home Life Mutual Insurance Company. Executive Vice
President and Director, Phoenix Investment Counsel,
Inc., Phoenix Securities Group, Inc. and Phoenix
Equity Planning Corporation. Director, W.S. Griffith &
Co., Inc., and Townsend Financial Advisers, Inc.
Director and Vice President, PM Holdings, Inc.
Executive Vice President, Phoenix Funds.
Michael E. Haylon Director and Executive Senior Vice President, Securities Investments, Phoenix
Vice President Home Life Mutual Insurance Company. Executive Vice
President, Phoenix Funds. Director and President,
Phoenix Investment Counsel, Inc. Director, Phoenix
Equity Planning Corporation.
Philip R. McLoughlin Chairman, CEO & Director Director and Executive Vice President, Investments,
Phoenix Home Life Mutual Insurance Company. Director
and President, Phoenix Equity Planning Corporation.
Director and Chairman, Phoenix Investment Counsel,
Inc., Director, Phoenix Realty Group, Inc., Phoenix
Realty Investors, Inc., Phoenix Realty Securities,
Inc., Phoenix Founders, Inc., Phoenix Re Corporation
(Delaware) and World Trust Fund; Director and Vice
President, PM Holdings, Inc. Director/Trustee/
President of the Phoenix Funds; President and Director
of Phoenix Securities Group, Inc. Director, W.S.
Griffith & Co., Inc. and Townsend Financial Advisers,
Inc.
C-2
<PAGE>
Positions with
Name Investment Adviser Other Vocation or Employment
------------------------ -------------------------- ------------------------------------------------------
Charles J. Paydos Director Executive Vice President and Director, Phoenix Home
Life Mutual Insurance Company. Director, Phoenix
Equity Planning Corporation, Phoenix Securities Group,
Inc., Phoenix Realty Securities, Inc., Phoenix Realty
Group, Inc., W.S. Griffith & Co., Inc., and Townsend
Financial Advisers, Inc. Director and Vice President,
PM Holdings, Inc.
Richard C. Shaw Director Senior Vice President, International and Corporate
Development, Phoenix Home Life Mutual Insurance
Company. Chairman, American Phoenix Corporation.
Director, President and Chief Executive Officer,
Worldwide Phoenix Offshore Inc. Director, American
Phoenix Investment Portfolios. Director and Senior
Vice President, Phoenix Investment Counsel, Inc.
Executive Vice President, Offshore Investment Funds,
Phoenix Investments Funds.
Patricia A. Bannan Executive Vice President Vice President, Common Stock, Phoenix Home Life Mutual
Insurance Company. Vice President, Phoenix Series Fund
and The Phoenix Edge Series Fund. Vice President,
Phoenix Investment Counsel, Inc.
William R. Moyer Senior Vice President, Vice President, Investment Products Finance, Phoenix
Finance and Treasurer Home Life Mutual Life Insurance Company. Senior Vice
President, Finance and Treasurer, Phoenix Equity
Planning Corporation and Phoenix Investment Counsel,
Inc. Vice President, Phoenix Funds, Senior Vice
President, Finance, Phoenix Securities Group, Inc.,
Senior Vice President, Chief Financial Officer and
Treasurer, W.S. Griffith & Co., Inc. and Townsend
Financial Advisers, Inc.
Michael K. Arends Vice President Portfolio Manager, Phoenix Home Life Mutual Insurance
Company. Vice President, Phoenix Series Fund, Phoenix
Strategic Equity Series Fund, National Securities &
Research Corporation and Phoenix Investment Counsel,
Inc. Various other positions with Kemper Financial
Services.
Curtiss O. Barrows Vice President Portfolio Manager, Public Bonds, Phoenix Home Life
Mutual Insurance Company. Vice President, Phoenix
Series Fund, Phoenix Multi-Portfolio Fund, The Phoenix
Edge Series Fund, and Phoenix Investment Counsel, Inc.
James M. Dolan Vice President and Assistant Vice President Compliance, Phoenix Home Life
Compliance Officer, Mutual Insurance Company. Vice President and
Assistant Secretary Compliance Officer; Assistant Secretary, Phoenix
Equity Planning Corporation. Vice President, Phoenix
Funds. Vice President, Assistant Clerk and Assistant
Secretary, Phoenix Investment Counsel, Inc. Vice
President and Chief Compliance Officer, Phoenix Realty
Advisors, Inc. and Chief Compliance Officer, Phoenix
Realty Securities, Inc.
C-3
<PAGE>
Positions with
Name Investment Adviser Other Vocation or Employment
------------------------ -------------------------- ------------------------------------------------------
Jeanne H. Dorey Vice President Portfolio Manager, International, Phoenix Home Life
Mutual Insurance Company. Vice President, The Phoenix
Edge Series Fund, Phoenix Multi-Portfolio Fund,
Phoenix Investment Counsel, Inc. and Phoenix Worldwide
Opportunities Fund.
Catherine Dudley Vice President Portfolio Manager, Common Stock, Phoenix Home Life
Mutual Insurance Company. Vice President, Phoenix
Series Fund, Phoenix Multi-Portfolio Fund and Phoenix
Investment Counsel, Inc.
Christopher J. Kelleher Vice President Portfolio Manager, Public Bonds, Phoenix Home Life
Mutual Insurance Company. Vice President, Phoenix
Series Fund, The Phoenix Edge Series Fund and Phoenix
Investment Counsel, Inc.
Thomas S. Melvin, Jr. Vice President Portfolio Manager, Common Stock, Phoenix Home Life
Mutual Insurance Company. Vice President, Phoenix
Investment Counsel, Inc. and Phoenix Multi-Portfolio
Fund.
Amy L. Robinson Vice President Managing Director, Securities Administration, Phoenix
Home Life Mutual Insurance Company. Vice President,
The Phoenix Edge Series Fund, Phoenix Series Fund, and
Phoenix Investment Counsel, Inc.
Leonard J. Saltiel Vice President Vice President, Investment Operations, Phoenix Home
Life Mutual Insurance Company. Senior Vice President,
Phoenix Equity Planning Corporation. Vice President,
Phoenix Funds.
Elizabeth R. Sadowinski Vice President, Field Vice President, Field and Investor Services, Phoenix
and Investors Services Equity Planning Corporation.
Dorothy J. Skaret Vice President Director, Public Fixed Income, Phoenix Home Life
Mutual Life Insurance Company. Vice President, Phoenix
Series Fund, The Phoenix Edge Series Fund, Phoenix
Investment Counsel, Inc. and Phoenix Realty
Securities, Inc.
James D. Wehr Vice President Managing Director, Public Fixed Income, Phoenix Home
Life Mutual Insurance Company. Vice President, Phoenix
Series Fund, The Phoenix Edge Series Fund, Phoenix
Multi-Portfolio Fund, Phoenix Investment Counsel,
Inc., and Phoenix California Tax-Exempt Bonds Inc.
John T. Wilson Vice President Portfolio Manager, Common Stock, Phoenix Home Life
Mutual Insurance Company. Vice President, Phoenix
Multi-Portfolio Fund, The Phoenix Edge Series Fund,
Phoenix Worldwide Opportunities Fund and National
Securities & Research Corporation.
Eugene A. Charon Controller Controller, Phoenix Equity Planning Corporation and
Phoenix Investment Counsel, Inc.
Patricia O. McLaughlin Secretary Counsel, Phoenix Home Life Mutual Insurance Company.
Secretary and Assistant Clerk, Phoenix Investment
Counsel, Inc. Assistant Secretary, the Phoenix Funds,
Phoenix Securities Group, Inc., Phoenix Equity
Planning Corporation, and Phoenix Realty Securities,
Inc. Secretary, W.S. Griffith & Co., Inc. and Townsend
Financial Advisers, Inc.
</TABLE>
C-4
<PAGE>
The respective principal addresses of the companies or other entities
named above are as follows:
American Phoenix Corporation }302 West Main Street
}Avon, CT 06001
American Phoenix Investment Portfolios }13, rue Goethe
}L-2014 Luxembourg
Kemper Financial Services }120 South LaSalle Street
}Chicago, IL 60603
Phoenix Equity Planning Corporation }100 Bright Meadow Boulevard
}P.O. Box 2200
}Enfield, CT 06083-2200
Phoenix Home Life Mutual Insurance Company }One American Row
}Hartford, CT 06115
Phoenix Investment Counsel, Inc. }One American Row
}Hartford, CT 06115
Phoenix Realty Advisors, Inc. }One American Row
}Hartford, CT 06115
Phoenix Realty Group, Inc. }One American Row
}Hartford, CT 06115
Phoenix Realty Investors, Inc. }One American Row
}Hartford, CT 06115
Phoenix Realty Securities, Inc. }One American Row
}Hartford, CT 06115
Phoenix Re Corporation (Delaware) }80 Maiden Lane
}New York, NY 01301
Phoenix Securities Group, Inc. }One American Row
}Hartford, CT 06115
PM Holdings, Inc. }One American Row
}Hartford, CT 06115
The Phoenix Funds }101 Munson Street
}Greenfield, MA 01301
Townsend Financial Advisers, Inc. }100 Bright Meadow Boulevard
}P.O. Box 2200
}Enfield, CT 06083-2200
W. S. Griffith & Co., Inc. }100 Bright Meadow Boulevard
}P.O. Box 2200
}Enfield, CT 06083-2200
Worldwide Phoenix Offshore Inc. }100 Bright Meadow Boulevard
}P.O. Box 2200
}Enfield, CT 06083-2200
World Trust Fund }KREDIETRUST
}Societe Anonyme
}11, rue Aldringen
}L-2690 Luxembourg
}R.C. Luxembourg B 10.750
Worldwide Phoenix Limited }41 Cedar House
}Hamilton HM 12, Bermuda
C-5
<PAGE>
Item 29. Principal Underwriters (a) See "The Underwriter" and "How to Buy
Shares" in the Prospectus and "The National Distributor" and "Plans of
Distribution" in the Statement of Additional Information, both of which
are included in this Post-Effective Amendment to the Registration
Statement. (b)
<TABLE>
<CAPTION>
Name and Position and Offices Position and Offices
Principal Address with Underwriter with Registrant
- -------------------------- --------------------------------- ---------------------------
<S> <C> <C>
Robert W. Fiondella Director None
One American Row
Hartford, CT 06115
Martin J. Gavin Director and Executive Executive Vice President
56 Prospect Street Vice President
P.O. Box 105480
Hartford, CT 06115-0480
Michael E. Haylon Director Executive Vice President
56 Prospect St.
P.O. Box 150480
Hartford, CT 06115-0480
Philip R. McLoughlin Director and President Trustee & President
One American Row
Hartford, CT 06115
Charles J. Paydos Director None
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200
Dona D. Young Director None
One American Row
Hartford, CT 06115
Richard C. Shaw Executive Vice President None
One American Row Offshore Investment Funds
Hartford, CT 06115
Leonard J. Saltiel Senior Vice President Vice President
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200
William R. Moyer Senior Vice President Vice President
100 Bright Meadow Blvd. Finance, and Treasurer
P.O. Box 2200
Enfield, CT 06083-2200
G. Jeffrey Bohne Vice President, Secretary
101 Munson Street Transfer Agent Operations
Greenfield, MA 01301
Nancy G. Curtiss Vice President, Fund Treasurer
56 Prospect Street Accounting
P.O. Box 150480
Hartford, CT 06115-0480
Maris Lambergs Vice President/National None
100 Bright Meadow Blvd. Sales Manager
P.O. Box 2200
Enfield, CT 06083-2200
C-6
<PAGE>
Name and Position and Offices Position and Offices
Principal Address with Underwriter with Registrant
- -------------------------- --------------------------------- ---------------------------
James M. Dolan Vice President; Compliance Vice President
100 Bright Meadow Blvd. Officer; and Assistant Secretary
P.O. Box 2200
Enfield, CT 06083-2200
Elizabeth R. Sadowinski Vice President, Field and Assistant Secretary
100 Bright Meadow Blvd. Investor Services
Enfield, CT 06083-2200
Eugene A. Charon Controller None
100 Bright Meadow Blvd.
P.O. Box 2200
Enfield, CT 06083-2200
Keith D. Robbins Secretary None
One American Row
Hartford, CT 06115
</TABLE>
Item 30. Location of Accounts and Records
Persons maintaining physical possession of accounts, books and other
documents required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and the Rules promulgated thereunder
include Registrant's investment adviser, National Securities &
Research Corporation; Registrant's financial agent, transfer agent
and principal underwriter, Phoenix Equity Planning Corporation;
Registrant's dividend disbursing agent, State Street Bank and Trust
Company; and Registrant's custodian, Brown Brothers Harriman & Co.
The address of the Secretary of the Trust is 101 Munson Street,
Greenfield, Massachusetts 01301; the address of National Securities
& Research Corporation is One American Row, Hartford, Connecticut
06115-2520; the address of Phoenix Equity Planning Corporation is
100 Bright Meadow Boulevard, P.O. Box 2200, Enfield, Connecticut
06083-2200; the address of the dividend disbursing agent is P.O. Box
8301, Boston, Massachusetts 02266-8301, Attention: Phoenix Funds,
and the address for the custodian is 40 Water Street, Boston,
Massachusetts 02109.
Item 31. Management Services
Not applicable.
Item 32. Undertakings
(a) Not applicable.
(b) Not applicable.
(c) Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of Registrant's latest annual
report to shareholders upon request and without charge.
C-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Hartford, and State of Connecticut on the 26th day of October, 1995.
PHOENIX WORLDWIDE OPPORTUNITIES FUND
ATTEST: /s/ Richard J. Wirth By: /s/ Philip R. McLoughlin
Richard J. Wirth Philip R. McLoughlin
Assistant Secretary President
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons
in the capacities indicated, on this 26th day of October, 1995.
Signature Title
- ---------------------------------------------- ------------------------
C. Duane Blinn* Trustee
Robert Chesek* Trustee
E. Virgil Conway* Trustee
Nancy G. Curtiss** Treasurer (principal
financial and
accounting officer)
Harry Dalzell-Payne* Trustee
Leroy Keith, Jr.* Trustee
/s/ Philip R. McLoughlin
Philip R. McLoughlin Trustee and President
James M. Oates* Trustee
Philip R. Reynolds* Trustee
Herbert Roth, Jr.* Trustee
Richard E. Segerson* Trustee
Lowell P. Weicker, Jr.*** Trustee
*By: /s/ Philip R. McLoughlin
*Philip R. McLoughlin pursuant to powers of attorney filed with
Post-Effective Amendment No. 59 under this Registration Statement.
**Philip R. McLoughlin pursuant to power of attorney filed with
Post-Effective Amendment No. 60 under this Registration Statement.
***Philip R. McLoughlin pursuant to power of attorney filed herewith.
S-1(c)
Exhibit 1.2
Amendment to Declaration of Trust
<PAGE>
PHOENIX WORLDWIDE OPPORTUNITIES FUND
Certificate of Amendment to Declaration of Trust
The undersigned, being all of the Board of Trustees of the Phoenix
Worldwide Opportunities Fund, a Massachusetts business trust (the "Trust"),
do hereby certify that, pursuant to the authority conferred upon the Trustees
of the Trust pursuant to Section 5.13 of that certain Declaration of Trust
dated November 4, 1991, as amended (hereinafter collectively referred to as
the "Declaration"), the Declaration is hereby further amended as follows:
1. The first sentence in Article V, Section 5.1 is hereby deleted and the
following inserted in lieu thereof:
The interest of the beneficiaries hereunder shall be divided into an
unlimited number of transferable shares of beneficial interest, in one
or more distinct and separate series or classes thereof as the Trustees
from time to time may create and establish in accordance with Sections
5.11, 5.13 and 5.14 hereof, par value of $0.01 per share.
2. Article V, Section 5.14 is hereby added, to wit:
Section 5.13. Dual Distribution System. Without in any manner
limiting the rights of the Trustees pursuant to Section 5.13, above,
the Trustees hereby divide the Shares of the Trust into two Classes.
The Classes, so established, shall be designated as "Phoenix Worldwide
Opportunities Fund Class A Shares" ("Class A Shares") and "Phoenix
Worldwide Opportunities Fund Class B Shares" ("Class B Shares").
Subject to Section 5.13 of this Declaration, the following preferences,
conversion and other rights, voting powers, restrictions, limitations
as to dividends, qualifications and terms and conditions of redemption
shall pertain to all Shares in each of the foregoing Classes:
(a) The assets belonging to each Class shall be invested in the same
investment portfolio as the Trust.
(b) The dividends and distributions of investment income and capital
gains with respect to each Class shall be in such amounts as may be
declared from time to time by the Trustees, and the dividends and
distributions of each Class may vary from dividends and distributions
of investment income and capital gains with respect to the other Class
to reflect differing allocations of the expenses of the Trust between
the holders of the two classes and any resultant differences between
the net asset value per share of the two classes, to such extent and
for such purposes as the Trustees may deem appropriate. The allocation
of investment income or capital gains and expenses and liabilities of
the Trust between the Class A Shares and the Class B Shares shall be
determined by the Trustees in a manner that is consistent with the
order dated September 13, 1993 (Investment Company Act of 1940 Release
No. IC-19706) issued by the Securities and Exchange Commission in
connection with the application for exemption filed by National
Multi-Sector Fixed Income Fund, et al., any amendment to such order or
any rule or interpretation under the Investment Company Act of 1940
that modifies or supersedes such order.
(c) Class A Shares (including fractional shares thereof) may be
subject to an initial sales charge pursuant to the terms of the
issuance of such Shares.
(d) The proceeds of the redemption of Class B Shares (including a
fractional share thereof) shall be reduced by the amount of any
contingent deferred sales charge payable on such redemption pursuant to
the terms of the issuance of such Shares.
(e) The holders of Class A Shares and Class B Shares shall have (i)
exclusive voting rights with respect to provisions of any distribution
plan adopted by the Trust pursuant to Rule 12b-1 under the Investment
Company Act of 1940 (a "Plan") applicable to the respective Class B,
and (ii) no voting rights with respect to provisions of any Plan
applicable to the other Class, or with regard to any other matter
submitted to a vote of shareholders which does not affect holders of
that respective Class B.
(f)(i) Each Class B Share, other than a share purchased through the
automatic reinvestment of a dividend or a distribution with respect to
Class B Shares, shall be converted automatically, and without any
action or choice on the part of the holder thereof, into Class A Shares
on the date that is the first business day following the month in which
the eighth anniversary date of the date of the issuance of the Class B
Share falls (the "Conversion Date"). With respect to Class B Shares
issued in an exchange or series of exchanges for shares of shares of
beneficial interest or common stock, as the case may be, of another
investment company or class or series thereof registered under the
Investment Company Act of 1940 pursuant to an exchange privilege
granted by the Trust, the date of issuance of the Class B Shares for
purposes of the immediately preceding sentence shall be the date of
issuance of the original shares of beneficial interest or common stock,
as the case may be.
(ii) Each Class B Share acquired through the automatic reinvestment
of a dividend or a distribution with respect to Class B Shares shall be
segregated in a separate sub-account. Each time any Class B Shares in a
shareholder's Fund account (other than those in the aforedescribed
applicable sub-account) convert to Class A Shares, an equal pro rata
portion of the Class B Shares then in the sub-account will also convert
to Class A Shares without any action or choice on the part of the
holder thereof. The portion will be determined by the ratio that the
shareholder's Class B Shares converting to Class A Shares bears to the
shareholder's total Class B Shares not acquired through dividends and
distributions.
(iii) The conversion of Class B Shares to Class A Shares is subject
to the continuing availability of an opinion of counsel or a ruling of
the Internal Revenue Service that payment of different dividends on
Class A and Class B Shares does not result
<PAGE>
in the Trust's dividends or distributions constituting "preferential
dividends" under the Internal Revenue Code of 1986, as amended, and
that the conversion of shares does not constitute a taxable event under
federal income tax law.
(iv) The number of shares of Class A Shares into which a share of
Class B Shares is converted pursuant to paragraphs (f)(i) and (f)(ii)
hereof shall equal the number (including for this purpose fractions of
a Share) obtained by dividing the net asset value per share of the
Class B Shares (for purposes of sales and redemptions thereof on the
Conversion Date) by the net asset value per share of the Class A Shares
(for purposes of sales and redemptions thereof on the Conversion Date).
(v) On the Conversion Date, the Class B Shares converted into shares
of Class A Shares will cease to accrue dividends and will no longer be
deemed outstanding and the rights of the holders thereof (except the
right to receive (i) the number of shares of Class A Shares have been
converted and (ii) declared but unpaid dividends to the Conversion
Date) will cease. Certificates representing Class A Shares resulting
from the conversion need not be issued until certificates representing
Class B Shares converted, if issued, have been received by the Trust or
its agent duly endorsed for transfer.
3. Article X, Section 10.6 is hereby amended to reflect that the principal
place of business of the Trust is 101 Munson Street, Greenfield,
Massachusetts.
4. In accordance with Article VIII, Section 8.3(a) of the Declaration, the
Declaration is hereby amended in order to reflect the change in the
name of the Trust to "Phoenix Worldwide Opportunities Fund" and to
substitute said name for the name of "National Worldwide Opportunities
Fund" in each place it appears in the Declaration.
Except as hereinabove and hereinbefore modified, all other terms and
conditions set forth in the Declaration shall be and remain in full force and
effect.
WITNESS our hands this 25th day of May, 1994.
/s/ C. Duane Blinn /s/ Philip R. McLoughlin
- -------------------------- -------------------------
C. Duane Blinn Philip R. McLoughlin
/s/ Robert Chesek /s/ James M. Oates
- -------------------------- -------------------------
Robert Chesek James M. Oates
/s/ E. Virgil Conway /s/ Philip R. Reynolds
- -------------------------- -------------------------
E. Virgil Conway Philip R. Reynolds
/s/ Harry Dalzell-Payne /s/ Herbert Roth, Jr.
- -------------------------- -------------------------
Harry Dalzell-Payne Herbert Roth, Jr.
/s/ Leroy Keith, Jr. /s/ Richard E. Segerson
- -------------------------- -------------------------
Leroy Keith, Jr. Richard E. Segerson
Exhibit 5.2
Amendment to Management Agreement
<PAGE>
FIRST AMENDMENT TO
PHOENIX WORLDWIDE OPPORTUNITIES FUND
MANAGEMENT AGREEMENT
THIS AMENDMENT made effective as of the 1st day of January, 1994 by and
between PHOENIX WORLDWIDE OPPORTUNITIES FUND, f/k/a National Worldwide
Opportunities Fund (hereinafter called the "Trust") and NATIONAL SECURITIES &
RESEARCH CORPORATION (hereinafter called "National").
Preamble
The Trust and National have entered into a certain Management Agreement
dated May 14, 1993 (the "Agreement") wherein National agreed inter alia, to
provide its advice and assistance to the Trust in exchange for which the
Trust agreed to pay a prescribed fee to National.
On June 30, 1993, the Board of Trustees of the Trust approved an amendment
to the Trust's Declaration of Trust changing the name of the Trust to Phoenix
Worldwide Opportunities Fund.
On August 25, 1993, the Board of Trustees of the Trust also approved an
amendment modifying the management fees payable to National to a monthly fee
equivalent to the annual rate of 0.75% of the Trust's average daily net
assets up to $1 billion, 0.70% of the Trust's average daily net assets from
$1 to $2 billion, and 0.65% of the Trust's average daily net assets in excess
of $2 billion.
Accordingly, parties intend to amend the Agreement to reflect the present
name of the Trust and the revised management fees payable to National.
NOW, THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the parties mutually agree that the Agreement is
hereby revised as follows:
1. Any and all references to "National Worldwide Opportunities Fund" are
hereby deleted and "Phoenix Worldwide Opportunities Fund" is
substituted therefor.
2. Paragraph numbered 6 of the Agreement is hereby deleted and the
following is inserted in lieu thereof:
As compensation to National, the Trust will pay National a management
fee equivalent to the annual rate of 0.75% of the Trust's average
daily net assets up to $1 billion, 0.70% of the Trust's average daily
net assets from $1 to $2 billion, and 0.65% of the Trust's average
daily net assets in excess of $2 billion. National's fee will be
accrued daily against the value of the Trust's net assets and will be
payable by the Trust on the last business day of each month.
Except as herein modified, all other terms and provisions set forth in the
Agreement shall be and remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed by their officers thereunto duly authorized as of the day and year
first above written.
PHOENIX WORLDWIDE OPPORTUNITIES FUND
By: /s/ Philip R. McLoughlin
Philip R. McLoughlin
President
Attest:
By: /s/ Richard Wirth
Richard Wirth
Assistant Secretary
NATIONAL SECURITIES & RESEARCH CORPORATION
By: /s/ Michael Haylon
Michael Haylon
Vice President
Attest:
By: /s/ Patricia O. McLaughlin
Patricia O. McLaughlin
Assistant Secretary
Exhibit 10
Opinion as to Legality of Shares
<PAGE>
October __, 1995
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Ladies and Gentlemen:
This opinion is furnished in connection with the registration under the
Securities Act of 1933, as amended, of Class B shares ("Shares") of the
Phoenix Worldwide Opportunities Fund (the "Phoenix Fund"), a separate class
that will be offered and sold by the Phoenix Fund.
In rendering our opinion, we have examined such documents, records, and
matters of law as we deemed necessary for purposes of this opinion. We have
assumed the genuineness of all signatures of all parties, the authenticity of
all documents submitted as originals, the correctness of all copies, and the
correctness of all facts set forth in the certificates delivered to us and
the correctness of all written or oral statements made to us.
Based upon the subject to the foregoing, it is our opinion that the Shares
that will be issued by the Phoenix Fund when sold will be legally issued,
fully paid, and nonassessable.
Our opinion is rendered solely in connection with the Registration
Statement on Form N-1A under which the Shares will be registered and may not
be relied upon for any other purposes without our written consent. We hereby
consent to the use of this opinion as an exhibit to such Registration
Statement.
Yours truly,
/s/ Richard J. Wirth
Richard J. Wirth
Exhibit 11
Consent of Independent Accountants
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 61 to the registration statement on Form N-1A (the
"Registration Statement") of our report dated August 10, 1995, relating to
the financial statements and financial highlights appearing in the June 30,
1995 Annual Report to Shareholders of the Phoenix Worldwide Opportunities
Fund, which are also incorporated by reference into the Registration
Statement. We also consent to the reference to us under the heading
"Financial Highlights" in the Prospectus and under the heading "Independent
Accountants" in the Statement of Additional Information.
PRICE WATERHOUSE LLP
Boston, Massachusetts
October 27, 1995
Exhibit 18
Power of Attorney
<PAGE>
POWER OF ATTORNEY
I, the undersigned member of the Board of Trustees of Phoenix Worldwide
Opportunities Fund, hereby constitute and appoint Philip R. McLoughlin and
Patricia O. McLaughlin as my true and lawful attorneys and agents with full
power to sign for me in the capacity indicated below, any or all Registration
Statements or amendments thereto filed with the Securities and Exchange
Commission under the Securities Act of 1933 and/or the Investment Company Act
of 1940 relating to Phoenix Worldwide Opportunities Fund, and hereby ratify
and confirm my signature as it may be signed by said attorneys and agents.
WITNESS my hand and seal on the date set forth below.
June 6, 1995 /s/ Lowell P. Weicker, Jr. Trustee
Lowell P. Weicker, Jr.
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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