AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 7, 2000
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 |X|
PRE-EFFECTIVE AMENDMENT NO. [ ]
POST-EFFECTIVE AMENDMENT NO. 68 |X|
AND/OR
REGISTRATION STATEMENT
INVESTMENT COMPANY ACT OF 1940 |X|
AMENDMENT NO. 68 |X|
(CHECK APPROPRIATE BOX OR BOXES.)
------------
PHOENIX-ABERDEEN 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)
------------
PAMELA S. SINOFSKY
ASSISTANT VICE PRESIDENT AND ASSISTANT COUNSEL
PHOENIX INVESTMENT PARTNERS, LTD.
56 PROSPECT STREET
HARTFORD, CONNECTICUT 06115-0479
(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)
[ ] 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)
[X] 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.
================================================================================
<PAGE>
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
CROSS REFERENCE SHEET PURSUANT TO RULE 495(A)
PART A
<TABLE>
<CAPTION>
ITEM NUMBER FORM N-1A PROSPECTUS CAPTION
--------------------- ------------------
<S> <C> <C>
1. Front and Back Cover Pages............................... Cover Page, Back Cover Page
2. Risk/Return Summary: Investments, Risks, Performance..... Investment Risk and Return Summary;
Additional Investment Techniques
3. Risk Return Summary: Fee Table........................... Fund Expenses
4. Investment Objectives, Principal Investment Strategies,
and Related Risks...................................... Investment Risk and Return Summary;
Additional Investment Techniques
5. Management's Discussion of Fund Performance.............. Performance Tables
6. Management, Organization, and Capital Structure.......... Management of the Fund
7. Shareholder Information.................................. Pricing of Fund Shares; Sales Charges; Your
Account; How to Buy Shares; How to Sell Shares;
Things to Know When Selling Shares; Account
Policies; Investor Services; Tax Status
8. Distribution Arrangements................................ Sales Charges
9. Financial Highlights Information......................... Financial Highlights
</TABLE>
PART B
<TABLE>
<CAPTION>
ITEM NUMBER FORM N-1A STATEMENT OF ADDITIONAL INFORMATION CAPTION
--------------------- -------------------------------------------
<S> <C> <C>
10. Cover Page and Table of Contents......................... Cover Page, Table of Contents
11. Fund History............................................. The Fund
12. Description of the Fund and Its Investment Risks......... Investment Objectives and Policies; Investment
Restrictions
13. Management of the Fund................................... Management of the Fund
14. Control Persons and Principal Holders of Securities...... Management of the Fund
15. Investment Advisory and Other Services................... Services of the Adviser; The Distributor;
Distribution Plans; Other Information
16. Brokerage Allocation and Other Practices................. Portfolio Transactions and Brokerage
17. Capital Stock and Other Securities...................... Other Information
18. Purchase, Redemption, and Pricing of Shares.............. Net Asset Value; How to Buy Shares; Investor
Account Services; Redemption of Shares; Tax
Sheltered Retirement Plans
19. Taxation of the Fund..................................... Dividends, Distributions and Taxes
20. Underwriters............................................. The Distributor
21. Calculation of Performance Data.......................... Performance Information
22. Financial Statements..................................... Financial Statements
</TABLE>
PART C
INFORMATION REQUIRED TO BE INCLUDED IN PART C IS SET FORTH UNDER THE
APPROPRIATE ITEM, SO NUMBERED, IN PART C OF THIS REGISTRATION STATEMENT.
<PAGE>
TABLE OF CONTENTS
--------------------------------------------------------------------------------
Investment Risk and Return Summary........................................ 1
Fund Expenses............................................................. 4
Additional Investment Techniques.......................................... 5
Management of the Fund.................................................... 7
Pricing of Fund Shares.................................................... 8
Sales Charges............................................................. 9
Your Account.............................................................. 11
How to Buy Shares......................................................... 13
How to Sell Shares........................................................ 13
Things You Should Know When Selling Shares................................ 14
Account Policies.......................................................... 15
Investor Services......................................................... 17
Tax Status of Distributions............................................... 17
Financial Highlights...................................................... 18
Additional Information.................................................... 20
[triangle] Phoenix-
Aberdeen
Worldwide
Opportunities
Fund
<PAGE>
INVESTMENT RISK AND RETURN SUMMARY
--------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
Phoenix-Aberdeen Worldwide Opportunities Fund has an investment objective of
capital appreciation. There is no guarantee that the fund will achieve its
objective.
PRINCIPAL INVESTMENT STRATEGIES
> Under normal circumstances, the fund invests at least 65% of its total
assets in securities of issuers located in three or more countries, one
of which will be the United States.
> The fund invests primarily in common stocks. Companies selected for
fund investment may be of any capitalization and may be located in
countries with developed markets and countries with "emerging markets."
> The adviser manages the fund's investment program and general operation
of the fund. The subadviser manages the investments of the fund using a
top-down, bottom-up approach that seeks growth at a reasonable price.
The subadviser's process begins by selecting the amount of assets to
allocate to countries and geographic regions around the world based on
such economic, monetary and political factors as:
o prospects for relative economic growth among countries;
o expected levels of inflation;
o governmental policies influencing business decisions;
o relative price levels of various capital markets;
o the outlook for currency relationships; and
o the range of individual investment opportunities available.
> Within the designated country allocations, the subadviser uses primary
research to select individual securities for fund investment based on
factors such as industry growth, management strength and treatment of
minority shareholders, financial soundness, market share, company
valuation and earnings strength.
Temporary defensive strategy: If the adviser or subadviser believes that market
conditions are not favorable to the fund's principal strategies, the fund may
invest without limit in U.S. government securities and in money market
instruments. When this happens, the fund may not achieve its investment
objective.
Please see "Additional Investment Techniques" for other investment techniques of
the fund.
Phoenix-Aberdeen Worldwide Opportunities Fund 1
<PAGE>
PRINCIPAL RISKS
If you invest in this fund, you risk that you may lose your investment.
GENERAL
The value of the fund's investments that supports your share value can decrease.
If between the time you purchase shares and the time you sell shares the value
of the fund's investments decreases, you will lose money.
Investment values can decrease for a number of reasons. Conditions affecting the
overall economy, specific industries or companies in which the fund invests can
be worse than expected and investments may fail to perform as the adviser
expects. As a result, the value of your shares may decrease.
EMERGING MARKET INVESTING
Investments in less-developed countries whose markets are still emerging
generally present risks in greater degree than those presented by investments in
foreign issuers based in countries with developed securities markets and more
advanced regulatory systems. Prior governmental approval may be required in some
developing countries for the release of investment income, capital and sale
proceeds to foreign investors, and some developing countries may limit the
extent of foreign investment in domestic companies.
FOREIGN INVESTING
Investing in securities of non-U.S. companies involves special risks and
considerations not typically associated with investing in U.S. companies such
as:
o less publicly available information about foreign countries,
o political and economic instability within countries;
o differences in financial reporting standards and transaction
settlement systems;
o the possibility of expropriation or confiscatory taxation; and
o changes in investment or exchange regulations.
Some investments may be made in currencies other than U.S. dollars that will
fluctuate in value as a result of changes in the currency exchange rates.
Exchange rate fluctuations can cause the value of your shares to decrease or
increase. Generally, when the value of the U.S. dollar increases against the
foreign currency in which an investment is denominated, the security tends to
decrease in value which, in turn, may cause the value of your shares to
decrease.
SMALL CAPITALIZATION COMPANIES
Given the limited operating history and rapidly changing fundamental prospects,
investment returns from smaller capitalization companies can be highly volatile.
Small capitalization companies may be affected to a greater extent by changes in
economic conditions and
2 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
conditions in particular industries, are subject to varying patterns of trading
volume and may, at times, be difficult to sell.
PERFORMANCE TABLES
The bar chart and table below provide some indication of the risks of investing
in the Phoenix-Aberdeen Worldwide Opportunities Fund. The bar chart shows
changes in the fund's Class A Shares performance from year to year over a
10-year period(1). The table shows how the fund's average annual returns compare
to those of a broad-based securities market index. The fund's past performance
is not necessarily an indication of how the fund will perform in the future.
[GRAPHIC OMITTED]
CALENDAR YEAR ANNUAL RETURN (%)
1990 -22.7
1991 24.5
1992 3.2
1993 37.8
1994 0.0
1995 15.1
1996 15.0
1997 14.1
1998 31.2
1999 18.07
(1) The fund's average annual returns in the chart above do not reflect the
deduction of any sales charges. The returns would have been less than those
shown if sales charges were deducted. During the 10-year period shown in the
chart above, the highest return for a quarter was 19.21% (quarter ending
December 31, 1998) and the lowest return for a quarter was (19.71%) (quarter
ending September 30, 1990). Year-to-date performance (through September 30,
2000) was ______%.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
Average Annual Total Returns
(for the periods ending
12/31/99)(1) One Year Five Years Ten Years Life of the Fund(2)
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A Class B Class C
----------------------------------------------------------------------------------------------------------------
Class A Shares 11.28% 17.12% 11.68% N/A -- --
----------------------------------------------------------------------------------------------------------------
Class B Shares 13.12% 17.65% N/A -- 15.73% --
----------------------------------------------------------------------------------------------------------------
Class C Shares 16.77% N/A N/A -- -- 24.22%
----------------------------------------------------------------------------------------------------------------
MSCI World(3) 24.94% 19.76% 11.42% N/A 17.97% 24.94%(4)
----------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The fund's average annual returns in the table above reflect the deduction
of the maximum sales charge for an investment in the fund's Class A Shares and a
full redemption in the fund's Class B Shares.
(2) Class B Shares since July 15, 1994; Class C Shares since December 16, 1998.
(3) The Morgan Stanley Capital International World (net) Index (MSCI World) is
an unmanaged index calculated as an arithmetical average weighted by the market
value of approximately 1,600 companies listed on stock exchanges in 23
countries, including the U.S. and Canada. The index does not reflect any sales
charges or fees but does include the effect of foreign tax withholding.
(4) Index performance since December 31, 1998.
Phoenix-Aberdeen Worldwide Opportunities Fund 3
<PAGE>
FUND EXPENSES
--------------------------------------------------------------------------------
This table illustrates all fees and expenses that you may pay if you buy and
hold shares of the fund.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
------- ------- -------
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM
YOUR INVESTMENT)
Maximum Sales Charge (load) Imposed on
Purchases (as a percentage of offering price) 5.75% None None
Maximum Deferred Sales Charge (load) (as a
percentage of the lesser of the value
redeemed or the amount invested) None 5%(a) 1%(b)
Maximum Sales Charge (load) Imposed on
Reinvested Dividends None None None
Redemption Fee None None None
Exchange Fee None None None
------------------------------------------------------------------
CLASS A CLASS B CLASS C
SHARES SHARES SHARES
------- ------- -------
ANNUAL FUND OPERATING EXPENSES (EXPENSES
THAT ARE DEDUCTED FROM FUND ASSETS)
Management Fees 0.75% 0.75% 0.75%
Distribution and Service (12b-1) Fees(c) 0.25% 1.00% 1.00%
Other Expenses % % %
----- ----- -----
TOTAL ANNUAL FUND OPERATING EXPENSES % % %
===== ===== =====
</TABLE>
---------------------------------
(a) The maximum deferred sales charge is imposed on Class B Shares redeemed
during the first year; thereafter, it decreases 1% annually to 2% during the
fourth and fifth years and to 0% after the fifth year.
(b) The deferred sales charge is imposed on Class C Shares redeemed during the
first year only.
(c) Distribution and Service 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").
EXAMPLE
This example is intended to help you compare the cost of investing in the fund
with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
example also assumes that your investment has a 5% return each year and that the
fund's operating expenses remain the same. In the case of Class B Shares, it is
assumed that your shares are converted to Class A after eight years. Although
your actual costs may be higher or lower, based on these assumptions your costs
would be:
4 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
--------------------------------------------------------------------------------
CLASS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
--------------------------------------------------------------------------------
Class A
--------------------------------------------------------------------------------
Class B
--------------------------------------------------------------------------------
Class C
--------------------------------------------------------------------------------
You would pay the following expenses if you did not redeem your shares:
--------------------------------------------------------------------------------
CLASS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
--------------------------------------------------------------------------------
Class B
--------------------------------------------------------------------------------
Class C
--------------------------------------------------------------------------------
ADDITIONAL INVESTMENT TECHNIQUES
--------------------------------------------------------------------------------
In addition to the Principal Investment Strategies and Risks, the fund may
engage in the following investment techniques:
CONVERTIBLE SECURITIES
The fund may invest in convertible securities. Convertible securities may be
subject to redemption at the option of the issuer. If a security is called for
redemption, the fund may have to redeem the security, convert it into common
stock or sell it to a third party at a price and time that is not beneficial for
the fund. In addition, securities convertible into common stocks may have higher
yields than common stocks but lower yields than comparable nonconvertible
securities.
DERIVATIVES
The fund may write exchange-traded, covered call options and purchase put and
call options on indices and foreign currencies, and may enter into futures
contracts on foreign currencies and related options. The fund may use these
techniques to hedge against changes in interest rates, foreign currency exchange
rates, changes in securities prices or other factors affecting the value of
their investments. If the subadviser fails to correctly predict these changes,
the fund can lose money. Derivatives transactions may be less liquid than other
securities and the counterparty to such transaction may not perform as expected.
In addition, purchasing call or put options involves the risk that a fund may
lose the premium it paid plus transaction costs. Futures and options involve
market risk in excess of their value.
FIXED INCOME SECURITIES
The fund may invest in nonconvertible fixed income securities of U.S. and
foreign (non-U.S.) issuers including corporate notes, bonds and debentures that
are rated within the three highest
Phoenix-Aberdeen Worldwide Opportunities Fund 5
<PAGE>
rating categories at the time of investment, or if unrated, are deemed by the
subadviser to be of comparable quality. Generally, if interest rates rise, the
value of debt securities will fall.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The fund may invest in forward foreign currency exchange contracts. Such
contracts may limit potential exchange rate gains, may incur higher transaction
costs and may not protect the fund against future currency exchange fluctuations
as anticipated by the investment adviser.
GOVERNMENT SECURITIES
The fund may invest in Treasury bills, notes and bonds issued by the United
States Government, its agencies and instrumentalities and securities issued by
foreign governments and supranational agencies (such as the World Bank). Not all
government securities are backed by the full faith and credit of the issuing
country, including the United States.
HIGH YIELD-HIGH RISK SECURITIES
The fund may invest in high yield-high risk securities. High yield-high risk
securities (junk bonds) typically entail greater price volatility and principal
and interest rate risk. There is a greater chance that an issuer will not be
able to make principal and interest payments on time. Analysis of the
creditworthiness of issuers of high yield securities may be complex, and as a
result, it may be more difficult for the subadviser to accurately predict risk.
MUTUAL FUND INVESTING
The fund may invest in other mutual funds in order to take advantage of
investment opportunities in certain countries where the fund otherwise would not
have been able to invest. The assets invested in other mutual funds incur a
layering of expenses including operating costs, advisory fees and administrative
fees that you, as a shareholder in the fund, indirectly bear.
OTHER EQUITY SECURITIES
The fund may invest in preferred stocks, warrants, rights and securities
convertible into common stocks. Preferred stocks may not fully participate in
dividends, and convertible securities may have higher yields than common stocks
but lower yields than comparable nonconvertible securities.
UNRATED FIXED INCOME SECURITIES
The fund may invest in unrated securities. Unrated securities may not be lower
in quality than rated securities, but due to their perceived risk they may not
have as broad a market as rated securities. Analysis of unrated securities is
more complex than for rated securities, making it more difficult for the
subadviser to accurately predict risk.
The fund may buy other types of securities or employ other portfolio management
techniques. Please refer to the Statement of Additional Information for more
detailed information about these and other investment techniques of the fund.
6 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
MANAGEMENT OF THE FUND
--------------------------------------------------------------------------------
THE ADVISERS
Phoenix Investment Counsel, Inc. ("Phoenix") is the investment adviser to the
fund and is located at 56 Prospect Street, Hartford, CT 06115. Phoenix acts as
the investment adviser for 14 fund companies totaling 37 mutual funds, as
subadviser to two fund companies totaling three mutual funds and as adviser to
institutional clients. As of September 30, 2000, Phoenix had $___ billion in
assets under management. Phoenix has acted as an investment adviser for over
sixty years.
Aberdeen Fund Managers Inc. ("Aberdeen") is the subadviser to the fund and is
located at
1 Financial Plaza, Suite 2210, Fort Lauderdale, FL 33394. Aberdeen is a
wholly-owned subsidiary of Aberdeen Asset Management PLC based in Aberdeen,
Scotland. Together with its subsidiaries, Aberdeen Asset Management PLC provides
investment management services to unit and investment trusts, segregated pension
funds and other institutional and private portfolios, and through Aberdeen, U.S.
mutual funds. Aberdeen has served as subadviser for the Phoenix-Aberdeen New
Asia Fund, Phoenix-Aberdeen Global Small Cap Fund and the Aberdeen New Asia
Series of The Phoenix Edge Series Fund since their inception in 1996. Aberdeen
has also served as subadviser to Phoenix-Aberdeen International Fund of Phoenix
Multi-Portfolio Fund and the International Series of The Phoenix Edge Series
Fund since 1998. As of June 30, 2000, Aberdeen Asset Management PLC had $___
billion in assets under management.
Subject to the direction of the fund's Board of Trustees, Phoenix is responsible
for managing the fund's investment program and the day-to-day management of the
domestic portion of the fund's portfolio. Aberdeen, as subadviser, is
responsible for the day-to-day management of the foreign holdings of the fund.
Both Phoenix and Aberdeen manage the fund's assets to conform with the
investment policies as described in this prospectus. The fund pays Phoenix a
monthly investment management fee that is accrued daily against the value of the
fund's net assets at the following rates.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$1st billion $1+ billion through $2 billion $2+ billion
-----------------------------------------------------------------------------------------------------------------
Management Fee 0.75% 0.70% 0.65%
-----------------------------------------------------------------------------------------------------------------
Phoenix pays Aberdeen a fee for that portion of the fund's net assets that are invested in non-U.S. securities
as follows.
-----------------------------------------------------------------------------------------------------------------
$1st billion $1+ billion through $2 billion $2+ billion
-----------------------------------------------------------------------------------------------------------------
Subadvisory Fee 0.375% 0.35% 0.325%
-----------------------------------------------------------------------------------------------------------------
</TABLE>
Phoenix-Aberdeen Worldwide Opportunities Fund 7
<PAGE>
During the fund's last fiscal year, the fund paid total management fees of
$__________. The ratio of management fees to average net assets for the fiscal
year ended June 30, 2000 was 0.75%.
PORTFOLIO MANAGEMENT
Aberdeen's senior strategy committee determines and monitors the fund's regional
allocations across the globe on a monthly basis. An Aberdeen team of investment
professionals located in offices spread around the world selects securities for
the foreign portion of the fund's portfolio. At the same time, Christian C.
Bertelsen of Phoenix manages the U.S. portion of the fund's portfolio. Mr.
Bertelsen also serves as Portfolio Manager of both the Phoenix-Hollister Small
Cap Value Fund and Phoenix-Hollister Value Equity Fund (since inception in
1997). Mr. Bertelsen joined Phoenix in July 1997. Previously, from 1996 to July
1997, Mr. Bertelsen was employed by Dreman Value Advisors where he served as
chief investment officer and portfolio manager of the Kemper-Dreman Contrarian
and Small Cap Value Funds. From 1993 to 1996, Mr. Bertelsen was a Senior Vice
President of Eagle Asset Management where he managed private and institutional
assets, as well as the Heritage Value Equity Fund.
PRICING OF FUND SHARES
--------------------------------------------------------------------------------
HOW IS THE SHARE PRICE DETERMINED?
The fund calculates a share price for each class of its shares. The share price
is based on the net assets of the fund and the number of outstanding shares. In
general, the fund calculates net asset value by:
o adding the values of all securities and other assets of the fund,
o subtracting liabilities, and
o dividing the result by the total number of outstanding shares of the
fund.
Asset Value: The fund's investments are valued at market value. If market
quotations are not available, the fund determines a "fair value" for an
investment according to rules and procedures approved by the Trustees. Foreign
and domestic debt securities (other than short-term investments) are valued on
the basis of broker quotations or valuations provided by a pricing service
approved by the Trustees when such prices are believed to reflect the fair value
of such securities. Foreign and domestic equity securities are valued at the
last sale price or, if there has been no sale that day, at the last bid price,
generally. Short-term investments having a remaining maturity of sixty days or
less are valued at amortized cost, which the Trustees have determined
approximates market value.
8 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
Liabilities: Class specific expenses, distribution fees, service fees and other
liabilities are deducted from the assets of each class. Expenses and
liabilities that are not class specific (such as management fees) are allocated
to each class in proportion to each class' net assets except where an
alternative allocation can be more fairly made.
Net Asset Value: The liability allocated to a class plus any other expenses are
deducted from the proportionate interest of such class in the assets of the
fund. The resulting amount for each class is then divided by the number of
shares outstanding of that class to produce each class' net asset value per
share.
The net asset value per share of each class of the fund is determined on days
when the New York Stock Exchange (the "NYSE") is open for trading as of the
close of trading (normally 4:00 PM eastern time). The fund will not calculate
its net asset values per share on days when the NYSE is closed for trading. If
the fund holds securities that are traded on foreign exchanges that trade on
weekends or other holidays when the fund does not price its shares, the net
asset value of the fund's shares may change on days when shareholders will not
be able to purchase or redeem the fund's shares.
AT WHAT PRICE ARE SHARES PURCHASED?
All investments received by the fund's authorized agents prior to the close of
regular trading on the NYSE (normally 4:00 PM eastern time) will be executed
based on that day's net asset value. Shares credited to your account from the
reinvestment of fund distributions will be in full and fractional shares that
are purchased at the closing net asset value on the next business day on which
the fund's net asset value is calculated following the dividend record date.
SALES CHARGES
--------------------------------------------------------------------------------
WHAT ARE THE CLASSES AND HOW DO THEY DIFFER?
The fund presently offers two classes of shares that have different sales and
distribution charges (see "Fund Expenses" previously in this prospectus). The
fund has adopted distribution and service plans allowed under Rule 12b-1 of the
Investment Company Act of 1940 that authorize the fund to pay distribution and
service fees for the sale of its shares and for services provided to
shareholders.
WHAT ARRANGEMENT IS BEST FOR YOU?
The different classes permit you to choose the method of purchasing shares that
is most beneficial to you. In choosing a class, consider the amount of your
investment, the length of time you expect to hold the shares, whether you decide
to receive distributions in cash or to reinvest them in additional shares, and
any other personal circumstances. Depending upon these considerations, the
accumulated distribution and service fees and contingent deferred
Phoenix-Aberdeen Worldwide Opportunities Fund 9
<PAGE>
sales charges of one class may be more or less than the initial sales charge
and accumulated distribution and service fees of another class of shares bought
at the same time. Because distribution and service fees are paid out of the
fund's assets on an ongoing basis, over time these fees will increase the cost
of your investment and may cost you more than paying other types of sales
charges.
CLASS A SHARES. If you purchase Class A Shares, you will pay a sales charge at
the time of purchase equal to 5.75% of the offering price (6.10% of the amount
invested). The sales charge may be reduced or waived under certain conditions.
Class A Shares are not subject to any charges by the fund when redeemed. Class A
Shares have lower distribution and service fees (0.25%) and pay higher dividends
than any other class.
CLASS B SHARES. If you purchase Class B Shares, you will not pay a sales charge
at the time of purchase. If you sell your Class B Shares within the first five
years after they are purchased, you will pay a sales charge of up to 5% of your
shares' value. See "Deferred Sales Charge Alternative--Class B and C Shares"
below. This charge declines to 0% over a period of five years and may be waived
under certain conditions. Class B Shares have higher distribution and service
fees (1.00%) and pay lower dividends than Class A Shares. Class B Shares
automatically convert to Class A Shares eight years after purchase. Purchases of
Class B Shares may be inappropriate for any investor who may qualify for reduced
sales charges of Class A Shares and anyone who is over 85 years of age. The
underwriter may decline purchases in such situations.
CLASS C SHARES. If you purchase Class C Shares, you will not pay a sales charge
at the time of purchase. If you sell your Class C Shares within the first year
after they are purchased, you will pay a sales charge of 1%. See "Deferred Sales
Charge Alternative--Class B and C Shares" below. Class C Shares have the same
distribution and service fees (1.00%) and pay comparable dividends as Class B
Shares. Class C Shares do not convert to any other class of shares of the fund.
INITIAL SALES CHARGE ALTERNATIVE--CLASS A SHARES
The public offering price of Class A Shares is the net asset value plus a sales
charge that varies depending on the size of your purchase (see "Class A
Shares--Reduced Sales Charges: Combination Purchase Privilege" in the Statement
of Additional Information). Shares purchased based on the automatic reinvestment
of income dividends or capital gains distributions are not subject to any sales
charges. The sales charge is divided between your investment dealer and the
fund's underwriter (Phoenix Equity Planning Corporation or "PEPCO").
10 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
SALES CHARGE YOU MAY PAY TO PURCHASE CLASS A SHARES
SALES CHARGE AS
A PERCENTAGE OF
-----------------------------------------
AMOUNT OF NET
TRANSACTION OFFERING AMOUNT
AT OFFERING PRICE PRICE INVESTED
--------------------------------------------------------------------------------
Under $50,000 5.75% 6.10%
$50,000 but under $100,000 4.75 4.99
$100,000 but under $250,000 3.75 3.90
$250,000 but under $500,000 2.75 2.83
$500,000 but under $1,000,000 2.00 2.04
$1,000,000 or more None None
DEFERRED SALES CHARGE ALTERNATIVE--CLASS B AND CLASS C SHARES
Class B and Class C Shares are purchased without an initial sales charge;
however, shares sold within a specified time period are subject to a declining
contingent deferred sales charge ("CDSC") at the rates listed below. The sales
charge will be multiplied by the then current market value or the initial cost
of the shares being redeemed, whichever is less. No sales charge will be imposed
on increases in net asset value or on shares purchased through the reinvestment
of income dividends or capital gains distributions. To minimize the sales
charge, shares not subject to any charge will be redeemed first, followed by
shares held the longest time. To calculate the amount of shares owned and time
period held, all Class B Shares purchased in any month are considered purchased
on the last day of the preceding month, and all Class C Shares are considered
purchased on the trade date.
DEFERRED SALES CHARGE YOU MAY PAY TO SELL CLASS B SHARES
----------------------------------------------------------------------
YEAR 1 2 3 4 5 6+
CDSC 5% 4% 3% 2% 2% 0%
DEFERRED SALES CHARGE YOU MAY PAY TO SELL CLASS C SHARES
YEAR 1 2+
----------------------------------------------------------------------
CDSC 1% 0%
YOUR ACCOUNT
--------------------------------------------------------------------------------
OPENING AN ACCOUNT
Your financial advisor can assist you with your initial purchase as well as all
phases of your investment program. If you are opening an account by yourself,
please follow the instructions outlined below.
Phoenix-Aberdeen Worldwide Opportunities Fund 11
<PAGE>
STEP 1.
Your first choice will be the initial amount you intend to invest.
Minimum INITIAL investments:
o $25 for individual retirement accounts, or accounts that use the
systematic exchange privilege, or accounts that use the
Investo-Matic program (see below for more information on the
Investo-Matic program).
o There is no initial dollar requirement for defined contribution
plans, profit-sharing plans, or employee benefit plans. There is
also no minimum for reinvesting dividends and capital gains into
another account.
o $500 for all other accounts.
Minimum ADDITIONAL investments:
o $25 for any account.
o There is no minimum for defined contribution plans, profit-sharing
plans, or employee benefit plans. There is also no minimum for
reinvesting dividends and capital gains into an existing account.
The fund reserves the right to refuse any purchase order for any reason.
STEP 2.
Your second choice will be what class of shares to buy. The fund offers three
classes of shares for individual investors. Each has different sales and
distribution charges. Because all future investments in your account will be
made in the share class you choose when you open your account, you should make
your decision carefully. Your financial advisor can help you pick the share
class that makes the most sense for your situation.
STEP 3.
Your next choice will be how you want to receive any dividends and capital gain
distributions. Your options are:
o Receive both dividends and capital gain distributions in additional
shares;
o Receive dividends in additional shares and capital gain
distributions in cash;
o Receive dividends in cash and capital gain distributions in
additional shares; or
o Receive both dividends and capital gain distributions in cash.
No interest will be paid on uncashed distribution checks.
12 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
HOW TO BUY SHARES
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
TO OPEN AN ACCOUNT
-----------------------------------------------------------------------------------------------------
<S> <C>
Through a financial advisor Contact your advisor. Some advisors may charge a fee and may set
different minimum investments or limitations on buying shares.
-----------------------------------------------------------------------------------------------------
Complete a New Account Application and send it with a check
Through the mail payable to the fund. Mail them to: State Street Bank,
P.O. Box 8301, Boston, MA 02266-8301.
-----------------------------------------------------------------------------------------------------
Complete a New Account Application and send it with a check
Through express delivery payable to the fund. Send them to: Boston Financial Data
Services, Attn.: Phoenix Funds, 66 Brooks Drive, Braintree,
MA 02184.
-----------------------------------------------------------------------------------------------------
By Federal Funds wire Call us at (800) 243-1574 (press 1, then 0).
-----------------------------------------------------------------------------------------------------
Complete the appropriate section on the application and send it
By Investo-Matic with your initial investment payable to the fund. Mail them to:
State Street Bank, P.O. Box 8301, Boston, MA 02266-8301.
-----------------------------------------------------------------------------------------------------
By telephone exchange Call us at (800) 243-1574 (press 1, then 0).
-----------------------------------------------------------------------------------------------------
</TABLE>
HOW TO SELL SHARES
--------------------------------------------------------------------------------
You have the right to have the fund buy back shares at the net asset value next
determined
after receipt of a redemption order by the fund's Transfer Agent or an
authorized agent. In the case of a Class B or Class C Share redemption, you will
be subject to the applicable deferred sales charge, if any, for such shares.
Subject to certain restrictions, shares may be redeemed by telephone or in
writing. In addition, shares may be sold through securities dealers, brokers or
agents who may charge customary commissions or fees for their services. The fund
does not charge any redemption fees. Payment for shares redeemed is made within
seven days; however, redemption proceeds will not be disbursed until each check
used for purchases of shares has been cleared for payment by your bank, which
may take up to 15 days after receipt of the check.
Phoenix-Aberdeen Worldwide Opportunities Fund 13
<PAGE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
TO SELL SHARES
-----------------------------------------------------------------------------------------------------
<S> <C>
Through Contact your advisor. Some advisors may charge a fee and may set
a financial advisor different minimums on redemptions of accounts.
-----------------------------------------------------------------------------------------------------
Send a letter of instruction and any share certificates (if you
hold certificate shares) to: State Street Bank, P.O. Box 8301,
Through the mail Boston, MA 02266-8301. Be sure to include the registered owner's
name, fund and account number, and number of shares or dollar
value you wish to sell.
-----------------------------------------------------------------------------------------------------
Send a letter of instruction and any share certificates (if you
hold certificate shares) to: Boston Financial Data Services,
Through express delivery Attn.: Phoenix Funds, 66 Brooks Drive, Braintree, MA 02184. Be
sure to include the registered owner's name, fund and account
number, and number of shares or dollar value you wish to sell.
-----------------------------------------------------------------------------------------------------
By telephone For sales up to $50,000, requests can be made by calling
(800) 243-1574.
-----------------------------------------------------------------------------------------------------
By telephone exchange Call us at (800) 243-1574 (press 1, then 0).
-----------------------------------------------------------------------------------------------------
</TABLE>
THINGS YOU SHOULD KNOW WHEN SELLING SHARES
--------------------------------------------------------------------------------
You may realize a taxable gain or loss (for federal income tax purposes) if you
redeem shares of the fund. The fund reserves the right to pay large redemptions
"in-kind" (in securities owned by the fund rather than in cash). Large
redemptions are those over $250,000 or 1% of the fund's net assets. Additional
documentation will be required for redemptions by organizations, fiduciaries, or
retirement plans, or if redemption is requested by anyone but the shareholder(s)
of record. Transfers between broker-dealer "street" accounts are governed by the
accepting broker-dealer. Questions regarding this type of transfer should be
directed to your financial advisor. Redemption requests will not be honored
until all required documents in proper form have been received. To avoid delay
in redemption or transfer, shareholders having questions about specific
requirements should contact the fund's Transfer Agent at (800) 243-1574.
REDEMPTIONS BY MAIL
> If you are selling shares held individually, jointly, or as custodian
under the Uniform Gifts to Minors Act or Uniform Transfers to Minors
Act.
Send a clear letter of instructions if all of these apply:
o The proceeds do not exceed $50,000.
o The proceeds are payable to the registered owner at the address on
record.
14 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
Send a clear letter of instructions with a signature guarantee when any
of these apply:
o You are selling more than $50,000 worth of shares.
o The name or address on the account has changed within the last 60
days.
o You want the proceeds to go to a different name or address than on
the account.
> If you are selling shares held in a corporate or fiduciary account,
please contact the fund's Transfer Agent at (800) 243-1574.
If required, the signature on your request must be made 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.
SELLING SHARES BY TELEPHONE
The Transfer Agent will use reasonable procedures to confirm that telephone
instructions are genuine. Address and bank account information are verified,
redemption instructions are taped, and all redemptions are confirmed in writing.
The individual investor bears the risk from instructions given by an
unauthorized third party that the Transfer Agent reasonably believed to be
genuine.
The Transfer Agent may modify or terminate the telephone redemption privilege at
any time with 60 days notice to shareholders.
During times of drastic economic or market changes, telephone redemptions may be
difficult to make or temporarily suspended.
ACCOUNT POLICIES
--------------------------------------------------------------------------------
ACCOUNT REINSTATEMENT PRIVILEGE
For 180 days after you sell your Class A, Class B or Class C shares, you can
purchase Class A Shares of any fund at net asset value, with no sales charge, by
reinvesting all or part of your proceeds, but not more. Send your written
request to State Street Bank, P.O. Box 8301, Boston, MA 02266-8301. You can call
us at (800) 243-1574 for more information.
Please remember, a redemption and reinvestment are considered to be a sale and
purchase for tax-reporting purposes. Class B shareholders who have had the
contingent deferred sales charge waived because they are in the Systematic
Withdrawal Program are not eligible for this reinstatement privilege.
Phoenix-Aberdeen Worldwide Opportunities Fund 15
<PAGE>
REDEMPTION OF SMALL ACCOUNTS
Due to the high cost of maintaining small accounts, if your account balance is
less than $200, you may receive a notice requesting you to bring the balance up
to $200 within 60 days. If you do not, the shares in the account will be sold at
net asset value, and a check will be mailed to the address of record.
EXCHANGE PRIVILEGES
You should carefully read the prospectus of the fund into which you want to
exchange before deciding to make an exchange. You can obtain a prospectus from
your financial advisor or by calling us at 1-800-243-4361 or accessing our Web
site at www.phoenixinvestments.com.
o You may exchange shares for another fund in the same class of shares;
e.g., Class A for Class A. Exchange privileges may not be available
for all Phoenix Funds, and may be rejected or suspended.
o Exchanges may be made by phone (1-800-243-1574) or by mail (State
Street Bank, P.O. Box 8301, Boston, MA 02266-8301).
o The amount of the exchange must be equal to the minimum initial
investment required.
o The exchange of shares is treated as a sale and purchase for federal
income tax purposes.
o Because excessive trading can hurt fund performance and harm other
shareholders, the fund reserves the right to temporarily or
permanently end exchange privileges or reject an order from anyone
who appears to be attempting to time the market, including investors
who request more than one exchange in any 30-day period. The fund's
underwriter has entered into agreements with certain timing firms
permitting them to exchange by telephone. These privileges are
limited, and the fund distributor has the right to reject or suspend
them.
RETIREMENT PLANS
Shares of the fund may be used as investments under the following qualified
prototype retirement plans: traditional IRA, rollover IRA, SIMPLE IRA, Roth IRA,
401(k) plans, profit-sharing, money purchase plans, and 403(b) plans. For more
information, call (800) 243-4361.
16 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
INVESTOR SERVICES
INVESTO-MATIC is a systematic investment plan that allows you to have a
specified amount automatically deducted from your checking or savings account
and then deposited into your mutual fund account. Just complete the
Investo-Matic Section on the application and include a voided check.
SYSTEMATIC EXCHANGE allows you to automatically move money from one Phoenix Fund
to another on a monthly, quarterly, semi-annual or annual basis. Shares of one
Phoenix Fund will be exchanged for shares of the same class of another fund at
the interval you select. To sign up, just complete the Systematic Exchange
Section on the application. Exchange privileges may not be available for all
funds, and may be rejected or suspended.
TELEPHONE EXCHANGE lets you exchange shares of one fund for the same class of
shares in another fund, using our customer service telephone service. See the
Telephone Exchange Section on the application. Exchange privileges may not be
available for all funds, and may be rejected or suspended.
SYSTEMATIC WITHDRAWAL PROGRAM allows you to periodically redeem a portion of
your account on a predetermined monthly, quarterly, semiannual, or annual basis.
Sufficient shares will be redeemed on the 15th of the month at the closing net
asset value so that the payment is made about the 20th of the month. The program
also provides for redemptions on or about the 10th, 15th, or 25th with proceeds
directed through Automated Clearing House (ACH) to your bank. The minimum
withdrawal is $25.00, and minimum account balance requirements continue.
Shareholders in the program must own fund shares worth at least $5,000.
TAX STATUS OF DISTRIBUTIONS
--------------------------------------------------------------------------------
The fund plans to make distributions from net investment income at least
semiannually and to distribute net realized capital gains, if any, at least
annually. Distributions of short-term capital gains and net investment income
are taxable to shareholders as ordinary income. Long-term capital gains, if any,
distributed to shareholders and which are designated by the fund as capital
gains distributions, are taxable to shareholders as long-term capital gain
distributions regardless of the length of time you have owned your shares.
Unless you elect to receive distributions in cash, dividends and capital gain
distributions are paid in additional shares. All distributions, cash or
additional shares, are subject to federal income tax and may be subject to
state, local and other taxes.
Phoenix-Aberdeen Worldwide Opportunities Fund 17
<PAGE>
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
This table is intended to help you understand the fund's financial performance
for the past five years or since inception. Certain information reflects
financial results for a single fund share. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the fund (assuming reinvestment of all dividends and distributions). This
information has been audited by PricewaterhouseCoopers LLP, independent
accountants. Their report, together with the fund's financial statements, are
included in the fund's most recent Annual Report, which is available upon
request.
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------
YEAR ENDED JUNE 30,
<S> <C> <C> <C> <C> <C>
2000 1999 1998 1997 1996
---- ---- ---- ---- ----
Net asset value, beginning of period $12.40 $10.75 $10.29 $9.04
INCOME FROM INVESTMENT OPERATIONS:(3)
Net investment income (loss) 0.01(1) 0.02 0.03(1) (0.02)(1)
Net realized and unrealized gains 0.90 2.97 1.25 1.87
---- ---- ---- ---- ----
TOTAL FROM INVESTMENT OPERATIONS 0.91 2.99 1.28 1.85
---- ---- ---- ---- ----
LESS DISTRIBUTIONS:
Dividends from net investment income -- (0.13) (0.04) --
Dividends from net realized gains (2.38) (1.20) (0.78) (0.60)
In excess of net investment income -- (0.01) -- --
In excess of net realized gains -- -- -- --
---- ---- ---- ---- ----
TOTAL DISTRIBUTIONS (2.38) (1.34) (0.82) (0.60)
---- ---- ---- ---- ----
Change in net asset value (1.47) 1.65 0.46 1.25
---- ---- ---- ---- ----
NET ASSET VALUE, END OF PERIOD $10.93 $12.40 $10.75 $10.29
==== ===== ===== ===== =====
Total return(2) (8.90)% 31.45% 13.40% 21.39%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $192,619 $183,188 $153,005 $146,052
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.45% 1.42% 1.53% 1.60%
Net investment income (loss) 0.07% 0.21% 0.34% (0.19)%
Portfolio turnover 166% 156% 234% 245%
</TABLE>
----------------------------------
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) Distributions are made in accordance with the prospectus; however, class
level per share income from investment operations may vary from anticipated
results depending on the timing of share purchases and redemptions.
18 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
FINANCIAL HIGHLIGHTS (CONTINUED)
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
<TABLE>
<CAPTION>
CLASS B
------------------------------------------------------------------
YEAR ENDED JUNE 30,
<S> <C> <C> <C> <C> <C>
2000 1999 1998 1997 1996
---- ---- ---- ---- ----
Net asset value, beginning of period $12.04 $10.53 $10.14 $8.98
---- ---- ---- ---- ----
INCOME FROM INVESTMENT OPERATIONS:(5)
Net investment income (loss) (0.07)(1) (0.06) (0.08)(1) (0.08)(1)
Net realized and unrealized gains 0.85 2.90 1.21 1.84
---- ---- ---- ---- ----
TOTAL FROM INVESTMENT OPERATIONS 0.78 2.84 1.18 1.76
---- ---- ---- ---- ----
LESS DISTRIBUTIONS:
Dividends from net investment income -- (0.11) (0.01) --
Dividends from net realized gains (2.38) (1.20) (0.78) (0.60)
In excess of net investment income -- (0.02) -- --
In excess of net realized gains -- -- -- --
---- ---- ---- ---- ----
TOTAL DISTRIBUTIONS (2.38) (1.33) (0.79) (0.60)
---- ---- ---- ---- ----
Change in net asset value (1.60) 1.51 0.39 1.16
---- ---- ---- ---- ----
NET ASSET VALUE, END OF PERIOD $10.44 $12.04 $10.53 $10.14
==== ===== ===== ===== =====
Total return(2) 7.99% 30.61% 12.46% 20.50%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $12,351 $10,855 $8,412 $5,709
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.21% 2.17% 2.29% 2.34%
Net investment income (loss) (0.65)% (0.54)% (0.35)% (0.86)%
Portfolio turnover 166% 156% 234% 245%
-------------------------------
CLASS C
-----------------------
FROM
YEAR INCEPTION
ENDED 12/16/98 TO
6/30/00 6/30/99
------ -------
Net asset value, beginning of period $11.62
------ -------
INCOME FROM INVESTMENT OPERATIONS:(5)
Net investment income (loss)
Net realized and unrealized gains 1.18
------ -------
TOTAL FROM INVESTMENT OPERATIONS 1.18
------ -------
LESS DISTRIBUTIONS:
Dividends from net investment income --
Dividends from net realized gains (2.38)
In excess of net investment income --
In excess of net realized gains --
------ -------
TOTAL DISTRIBUTIONS (2.38
------ -------
Change in net asset value (1.20)
------ -------
NET ASSET VALUE, END OF PERIOD $10.42
Total return(2) 11.68%(3)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $838
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.28%(4)
Net investment income (loss) 0.04%(4)
Portfolio turnover 166%(3)
-------------------------------
(1) Computed using average shares outstanding.
(2) Maximum sales charges are not reflected in the total return calculation.
(3) Not annualized.
(4) Annualized.
(5) Distributions are made in accordance with the prospectus; however, class
level per share income from investment operations may vary from anticipated
results depending on the timing of share purchases and redemptions.
</TABLE>
Phoenix-Aberdeen Worldwide Opportunities Fund 19
<PAGE>
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------
STATEMENT OF ADDITIONAL INFORMATION
The fund has filed a Statement of Additional Information about the fund, dated
October 27, 2000 with the Securities and Exchange Commission. The Statement
contains more detailed information about the fund. It is incorporated into this
prospectus by reference and is legally part of the prospectus. You may obtain a
free copy of the Statement:
> by writing to Phoenix Equity Planning Corporation, 100 Bright Meadow
Blvd., P.O. Box 2200, Enfield, Connecticut 06083-2200, or
> by calling (800) 243-4361.
You may also obtain information about the fund from the Securities and Exchange
Commission:
> through its internet site (http://www.sec.gov),
> by visiting its Public Reference Room in Washington, DC,
> by writing to its Public Reference Section, Washington, DC 20549-0102
(a fee may be charged), or
> by electronic request at [email protected] (a fee may be charged).
Information about the operation of the Public Reference Room may be obtained by
calling 1-202-942-8090.
SHAREHOLDER REPORTS
The fund semiannually mails to its shareholders detailed reports containing
information about the fund's investments. The fund's Annual Report contains a
detailed discussion of the market conditions and investment strategies that
significantly affected the fund's performance from July 1 through June 30. You
may request a free copy of the fund's Annual and Semiannual Reports:
> by writing to Phoenix Equity Planning Corporation, 100 Bright Meadow
Blvd., P.O. Box 2200, Enfield, Connecticut 06083-2200 or
> by calling (800) 243-4361.
CUSTOMER SERVICE: (800) 243-1574
MARKETING: (800) 243-4361
TELEPHONE ORDERS: (800) 367-5877
TELECOMMUNICATION DEVICE (TTY): (800) 243-1926
<TABLE>
<CAPTION>
<S> <C>
SEC File Nos. 2-16590 and 811-945 (C) Printed on recycled paper using soybean ink
</TABLE>
20 Phoenix-Aberdeen Worldwide Opportunities Fund
<PAGE>
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
101 Munson Street
Greenfield, MA 01301
STATEMENT OF ADDITIONAL INFORMATION
October 27, 2000
This Statement of Additional Information is not a prospectus, but expands
upon and supplements the information contained in the current prospectus of
Phoenix-Aberdeen Worldwide Opportunities Fund (the "Fund"), dated October 27,
2000, 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 ................................................................ 1
Investment Restrictions ................................................. 1
Investment Techniques and Risks ......................................... 2
Performance Information.................................................. 4
Portfolio Transactions and Brokerage..................................... 5
Services of the Adviser ................................................. 6
Net Asset Value ......................................................... 7
How to Buy Shares ....................................................... 8
Alternative Purchase Agreements.......................................... 8
Investor Account Services ............................................... 11
How to Redeem Shares .................................................... 12
Tax Sheltered Retirement Plans .......................................... 13
Dividends, Distributions and Taxes ...................................... 14
The Distributor ......................................................... 16
Distribution Plans....................................................... 17
Management of the Fund................................................... 18
Other Information ....................................................... 24
Customer Service: (800) 243-1574
Marketing: (800) 243-4361
Telephone Orders: (800) 367-5877
Telecommunications Device (TTY): (800) 243-1926
PXP 691B (10/00)
<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. It was
reorganized as a Delaware business trust in October 2000. 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 former adviser by
Phoenix Home Life Mutual Insurance Company and the affiliation with other
Phoenix Funds. On November 18, 1998, the Trustees voted to change the name of
the Fund to "Phoenix-Aberdeen Worldwide Opportunities Fund."
INVESTMENT RESTRICTIONS
The following investment restrictions have been adopted by the Trust with
respect to the Fund. Except as otherwise stated, these investment restrictions
are "fundamental" policies. A "fundamental" policy is defined in the 1940 Act to
mean that the restriction cannot be changed without the vote of a "majority of
the outstanding voting securities" of the Fund. A majority of the outstanding
voting securities is defined in the 1940 Act as the lesser of (a) 67% or more of
the voting securities present at a meeting if the holders of more than 50% of
the outstanding voting securities are present or represented by proxy, or (b)
more than 50% of the outstanding voting securities.
The Fund may not:
(1) With respect to 75% of its total assets, purchase securities of an issuer
(other than the U.S. Government, its agencies, instrumentalities or authorities
or repurchase agreements collateralized by U.S. Government securities and other
investment companies), if: (a) such purchase would, at the time, cause more than
5% of the Fund's total assets taken at market value to be invested in the
securities of such issuer; or (b) such purchase would, at the time, result in
more than 10% of the outstanding voting securities of such issuer being held by
the Fund.
(2) Purchase securities if, after giving effect to the purchase, more than
25% of its total assets would be invested in the securities of one or more
issuers conducting their principal business activities in the same industry
(excluding the U.S. Government, its agencies or instrumentalities).
(3) Borrow money, except (i) in amounts not to exceed one third of the value
of the Fund's total assets (including the amount borrowed) from banks, and (ii)
up to an additional 5% of its total assets from banks or other lenders for
temporary purposes. For purposes of this restriction, (a) investment techniques
such as margin purchases, short sales, forward commitments, and roll
transactions, (b) investments in instruments such as futures contracts, swaps,
and options and (c) short-term credits extended in connection with trade
clearance and settlement, shall not constitute borrowing.
(4) Issue "senior securities" in contravention of the 1940 Act. Activities
permitted by SEC exemptive orders or staff interpretations shall not be deemed
to be prohibited by this restriction.
(5) Underwrite the securities issued by other persons, except to the extent
that, in connection with the disposition of portfolio securities, the Fund may
be deemed to be an underwriter under applicable law.
(6) Purchase or sell real estate, except that the Fund may (i) acquire or
lease office space for its own use, (ii) invest in securities of issuers that
invest in real estate or interests therein, (iii) invest in mortgage-related
securities and other securities that are secured by real estate or interests
therein, (iv) hold and sell real estate acquired by the Fund as a result of the
ownership of securities.
(7) Purchase or sell commodities or commodity contracts, except the Fund may
purchase and sell derivatives (including, but not limited to, options, futures
contracts and options on futures contracts) whose value is tied to the value of
a financial index or a financial instrument or other asset (including, but not
limited to, securities indexes, interest rates, securities, currencies and
physical commodities).
(8) Make loans, except that the Fund may (i) lend portfolio securities, (ii)
enter into repurchase agreements, (iii) purchase all or a portion of an issue of
debt securities, bank loan participation interests, bank certificates of
deposit, bankers' acceptances, debentures or other securities, whether or not
the purchase is made upon the original issuance of the securities and (iv)
participate in an interfund lending program with other registered investment
companies.
If any percentage restriction described above for the Fund is adhered to at
the time of investment, a subsequent increase or decrease in the percentage
resulting from a change in the value of the Fund's assets will not constitute a
violation of the restriction.
1
<PAGE>
INVESTMENT TECHNIQUES AND RISKS
The Fund's prospectus describes the investment objectives of the Fund and
summarizes the investment policies and investment techniques that the Fund will
employ in seeking to achieve its investment objective. The following discussion
supplements the description of the Fund's investment policies and techniques in
the Prospectus.
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.
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."
INVESTMENT COMPANIES
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.
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. 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.
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.
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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.
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 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.
The Fund may invest in fixed income securities rated below investment grade
(commonly referred to as "junk bonds"). Fixed income securities rated below
investment grade are deemed to be predominantly speculative with respect to the
issuer's capacity to pay interest and repay principal in accordance with the
terms of the obligations. Fixed income securities rated below investment grade
may involve a substantial risk of default or may be in default. Changes in
economic conditions or developments regarding the individual issuer are more
likely to cause price volatility and weaken the capacity of the issuers of such
securities to make principal and interest payments than is the case for higher
grade debt securities. An economic downturn affecting the issuer may result in
an increased incidence of default and a decline in prices of the issuer's
lower-rated securities. The market for fixed income securities rated below
investment grade may be thinner and less active than for higher-rated
securities. The
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secondary market in which fixed income securities rated below investment grade
are traded is generally less liquid than the market for higher grade debt
securities.
PERFORMANCE INFORMATION
Performance information for the Fund (and any class of the Fund) may appear
in advertisements, sales literature or reports to shareholders or prospective
investors. Performance information in advertisements and sales literature may be
expressed as a yield of a class of shares and as a total return of a class of
shares.
Standardized quotations of average annual total return for Class A, Class B
or Class C Shares will be expressed in terms of the average annual compounded
rate of return for a hypothetical investment in either Class A, Class B or Class
C 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 and Class C Shares, and assume that all dividends and distributions
on Class A, Class B and Class C Shares are reinvested when paid.
Performance information for the Fund may be compared, in reports and
promotional literature, to: (i) the EAFE (Europe, Australia, and Far East)
Index, the MSCI World (Net) 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, 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 Composite Stock Price Index (the "S&P 500"),
Dow Jones Industrial Average, Europe Australia Far East Index (EAFE), Morgan
Stanley Capital International World (net) Index, Consumer Price Index, Lehman
Brothers Corporate Index and Lehman Brothers T-Bond Index.
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 portfolio; or compare the Fund's equity or bond return figures to
well-known indices of market performance, including, but not limited to: the S&P
500, Dow Jones Industrial Average, CS First Boston High Yield Index and Salomon
Brothers Corporate Bond and Government Bond Indices.
For the one, five and ten year periods ended June 30, 2000, the average
annual total return of the Class A Shares was ___%, ___% and ___%, respectively.
For the one and five year periods ended June 30, 2000 and, since inception, July
15, 1994 through June 30, 2000 for Class B Shares, the average annual total
return was ___%,___% and ____%, respectively. For the one year period ended June
30, 2000 and since inception, December 16, 1998, through June 30, 2000, the
total return for Class C Shares was ___% and ___%, respectively. 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.
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The Fund may also compute aggregate total return for specified periods based
on a hypothetical 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 Share's maximum sales charge of 5.75% 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, 2000
was ________%.
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 times 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 this
information may be useful in varying degrees and may tend to reduce the
Adviser's expenses, 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.
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The Fund has adopted a policy and procedures governing the execution of
aggregated advisory client orders ("bunching procedures") in an attempt to lower
commission costs on a per-share and per-dollar basis. According to the bunching
procedures, the Adviser shall aggregate transactions unless it believes in its
sole discretion that such aggregation is inconsistent with its duty to seek best
execution (which shall include the duty to seek best price) for the Fund. No
advisory account of the Adviser is to be favored over any other account and each
account that participates in an aggregated order is expected to participate at
the average share price for all transactions of the Adviser in that security on
a given business day, with all transaction costs shared pro rata based on the
Fund's participation in the transaction. If the aggregated order is filled in
its entirety, it shall be allocated among the Adviser's accounts in accordance
with the allocation order, and if the order is partially filled, it shall be
allocated pro rata based on the allocation order. Notwithstanding the foregoing,
the order may be allocated on a basis different from that specified in the
allocation order if all accounts of the Adviser whose orders are allocated
receive fair and equitable treatment and the reason for such different
allocation is explained in writing and is approved in writing by the Adviser's
compliance officer as soon as practicable after the opening of the markets on
the trading day following the day on which the order is executed. If an
aggregated order is partially filled and allocated on a basis different from
that specified in the allocation order, no account that is benefited by such
different allocation may intentionally and knowingly effect any purchase or sale
for a reasonable period following the execution of the aggregated order that
would result in it receiving or selling more shares than the amount of shares it
would have received or sold had the aggregated order been completely filled. The
Trustees will annually review these procedures or as frequently as shall appear
appropriate.
The Adviser may use its broker/dealer affiliates, or other firms that sell
shares of the Fund, to buy and sell securities for the Fund, provided they have
the execution capability and that their commission rates are comparable to those
of other unaffiliated broker/dealers. Directors of PXP Securities Corp. or its
affiliates receive indirect benefits from the Fund as a result of its usual and
customary brokerage commissions that PXP Securities Corp. may receive for acting
as broker to the Fund in the purchase and sale of portfolio securities. The
investment advisory agreement does not provide for a reduction of the advisory
fee by any portion of the brokerage fees generated by portfolio transactions of
the Fund that PXP Securities Corp. may receive.
For the fiscal years ended June 30, 1998, 1999 and 2000, brokerage commission
paid by the Trust on portfolio transactions totaled $_______, $_______ and
$_______, respectively. In the fiscal years ended June 30, 1998, 1999 and 2000,
W. S. Griffith & Co., Inc., a broker-dealer subsidiary of Phoenix Home Life,
received $______, $_______ and $_______ in fund-related commissions attributed
to a clearing arrangement with an unaffiliated broker dealer. For the fiscal
year ended June 30, 2000, the amount paid to W. S. Griffith was ___% of total
brokerage commissions paid by the Trust and was paid on transactions amounting
to ___% of the aggregate dollar amount of transactions involving the payment of
commissions. In the fiscal year ended June 30, 2000, the Trust paid brokerage
commissions of $_______ to PXP Securities Corp., and affiliate of its
Distributor. For the fiscal year ended June 30, 2000, the amount paid to PXP
Securities Corp. was ___% of the total brokerage commission paid by the Trust
and was paid on transactions amounting to ___% of the aggregate dollar amount of
transactions involving the payment of commissions. Brokerage commissions of
$_______ paid during the fiscal year ended June 30, 2000, were paid on portfolio
transactions aggregating $_______ executed by brokers who provided research and
other statistical information.
SERVICES OF THE ADVISER
PIC acts as the investment adviser for 14 fund companies totaling 37 other
mutual funds, as subadviser to two fund companies totaling three mutual funds,
and as adviser to institutional clients. PIC has acted as an investment adviser
for over sixty years. PIC was originally organized in 1932 as John P. Chase,
Inc. As of September 30, 2000, PIC had approximately $___ billion assets under
management. Philip R. McLoughlin, a Trustee and officer of the Fund, is a
director of PIC. All other executive officers of the Fund are officers of PIC.
The investment adviser to the fund is Phoenix Investment Counsel, Inc. ("PIC"
or "Adviser"), which is located at 56 Prospect Street, Hartford, Connecticut
06115-0480. All of the outstanding stock of PIC is owned by Phoenix Equity
Planning Corporation ("Equity Planning" or "Distributor"), a subsidiary of
Phoenix Investment Partners, Ltd. ("PXP"). Phoenix Home Life Mutual Insurance
Company ("Phoenix Home Life") of Hartford, Connecticut is a majority shareholder
of PXP. Phoenix Home Life is in the business of writing ordinary and group life
and health insurance and annuities. Its principal offices are located at One
American Row, Hartford, Connecticut, 06115-2520. Equity Planning, a mutual fund
distributor, acts as the national distributor of the Fund's shares and as
Financial Agent of the Fund. The principal office of Equity Planning is located
at 100 Bright Meadow Boulevard, Enfield, Connecticut, 06082.
PXP is a publicly-traded independent registered investment advisory firm and
has served investors for over 70 years. As of September 30, 2000, PXP had
$_________ in assets under management through its investment partners: Aberdeen
Fund Managers, Inc. (Aberdeen) in Aberdeen, London, Singapore and Fort
Lauderdale; Duff & Phelps Investment Management Co. (Duff & Phelps) in Chicago;
Roger Engemann & Associates, Inc. (Engemann) in Pasadena; Seneca Capital
Management LLC
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(Seneca) in San Francisco; Phoenix/Zweig Advisers LLC (Zweig) in New York; and
Phoenix Investment Counsel, Inc. (Goodwin, Hollister, and Oakhurst divisions) in
Hartford, Sarasota and Scotts Valley, CA, respectively.
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; outside legal and auditing accounting services,
regulatory filing fees and expenses of printing the Fund's registration
statements (but the Distributor purchases such copies of the Fund's prospectuses
and reports and communication to shareholders as it may require for sales
purposes), insurance expense, association membership dues, brokerage fees, and
taxes.
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
monthly. The fee is computed at an annual rate of 0.75% of the Fund's average
daily net assets of up to $1 billion, 0.70% of the Fund's average daily net
assets from $1 billion to $2 billion, and 0.65% of the Fund's average daily net
assets in excess of $2 billion. Total management fees for the fiscal years ended
June 30, 1998, 1999 and 2000 amounted to, $1,278,505, $1,435,159 and $_____,
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 compensated by the Adviser, 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 Distributor 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.
The Fund, its Advisers and Subadviser, and Distributor have each adopted a
Code of Ethics pursuant to Rule 17-j1 under the Investment Company Act of 1940.
Personnel subject to the Codes of Ethics may purchase and sell securities for
their personal accounts, including securities that may be purchased, sold or
held by the Fund, subject to certain restrictions and conditions. Generally,
personal securities transactions are subject to preclearance procedures,
reporting requirements and holding period rules. The Codes also restrict
personal securities transactions in private placements, initial public offerings
and securities in which the Fund has a pending order.
THE SUBADVISER
Aberdeen Fund Managers Inc. ("Aberdeen") serves as subadvisor for the Fund.
Aberdeen has been an investment advisor since 1995 and is a wholly-owned
subsidiary of Aberdeen Asset Management PLC which was established in 1983 to
provide investment management services to unit and investment trusts, segregated
pension funds and other institutional and private portfolios. As of June 30,
2000 Aberdeen managed in excess of $____ billion in assets for institutional
portfolios. Aberdeen's principal offices are located at 1 Financial Plaza, Suite
2210, Nations Bank Tower, Fort Lauderdale, Florida 33394. The address of
Aberdeen Asset Management PLC is 10 Queens Terrace, Aberdeen, Scotland AB101QG.
The Subadvisory Agreement provides that the advisor, PIC, will delegate to
Aberdeen the performance of certain of its investment management services under
the Management Agreement. Aberdeen will furnish at its own expense the office
facilities and personnel necessary to perform such services. For its services as
subadvisor, PIC will pay Aberdeen compensation at the annual rate of .375% of
the Fund's average daily net assets up to $1 billion, .35% of the Fund's average
daily net assets from $1 billion to $2 billion and .325% of the Fund's average
daily net assets in excess of $2 billion. The Subadvisory Agreement will
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continue in effect thereafter only so long as its continuance has been
specifically approved at least annually by the Trustees, including a majority of
the disinterested Trustees.
NET ASSET VALUE
The net asset value per share of the Fund is determined as of the close of
trading of the New York Stock Exchange (the "Exchange") on days when the
Exchange is open for trading. The Exchange will be closed on the following
observed national holidays: New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. Since the Fund does not price securities on
weekends or United States national holidays, the value of the Fund's foreign
assets may be significantly affected on days when the investor has no access to
the Fund. The net asset value per share of the Fund is determined by adding the
values of all securities and other assets of the Fund, subtracting liabilities,
and dividing by the total number of outstanding shares of the Fund. Assets and
liabilities are determined in accordance with generally accepted accounting
principles and applicable rules and regulations of the Securities and Exchange
Commission. The total liability allocated to a class, plus that class'
distribution fee and any other expenses allocated solely to that class, are
deducted from the proportionate interest of such class in the assets of the
Fund, and the resulting amount of each is divided by the number of shares of
that class outstanding to produce the net asset value per share.
A security that is listed or traded on more than one exchange is valued at
the quotation on the exchange determined to be the primary exchange for such
security by the Trustees or their delegates. Because of the need to obtain
prices as of the close of trading on various exchanges throughout the world, the
calculation of net asset value may not take place for the Fund which invests in
foreign securities contemporaneously with the determination of the prices of the
majority of the portfolio securities of the Fund. All assets and liabilities
initially expressed in foreign currency values will be converted into United
States dollar values at the mean between the bid and ask quotations of such
currencies against United States dollars as last quoted by any recognized
dealer. If an event were to occur after the value of an investment was so
established but before the net asset value per share was determined, which was
likely to materially change the net asset value, then the instrument would be
valued using fair value considerations by the Trustees or their delegates. If at
any time the Fund has investments where market quotations are not readily
available, such investments are valued at the fair value thereof as determined
in good faith by the Trustees although the actual calculations may be made by
persons acting pursuant to the direction of the Trustees.
HOW TO BUY SHARES
The minimum initial investment is $500 and the minimum subsequent investment
is $25. However, 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 Distributor, or pursuant to the Systematic Exchange
privilege or for an individual retirement account (the "IRA"). In addition,
there are no subsequent investment minimum amounts in connection with the
reinvestment of dividend or capital gain distributions. Completed applications
for the purchase of shares should be mailed to: Phoenix Funds, c/o State Street
Bank and Trust Company, P.O. Box 8301, Boston, MA 02266-8301.
The Fund has authorized one or more brokers to accept on its behalf purchase
and redemption orders. Such brokers are authorized to designate other
intermediaries to accept purchase and redemption orders on the Fund's behalf.
The Fund will be deemed to have received a purchase or redemption order when an
authorized broker or, if applicable, a broker's authorized designee, accepts the
order. Customer orders will be priced at the Fund's net asset value next
computed after they are accepted by an authorized broker or the broker's
authorized designee.
ALTERNATIVE PURCHASE AGREEMENTS
Shares 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"). Orders received by dealers prior to the close of
trading on the New York Stock Exchange are confirmed at the offer price
effective at that time, provided the order is received by the Authorized Agent
prior to its close of business.
The alternative purchase arrangements permit 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 Funds, and other circumstances. Investors should consider whether, during
the anticipated life of their investment in the Fund, the accumulated continuing
distribution and service fees and contingent deferred sales charges on Class B
or C Shares would be less than the initial sales charge and accumulated
distribution and service fees on Class A Shares purchased at the same time.
Dividends paid by the Fund, if any, with respect to each Class of Shares will
be calculated in the same manner at the same time on the same day, except that
fees such as higher distribution and services fees and any incremental transfer
agency costs relating to each Class of Shares will be borne exclusively by that
class. See "Dividends, Distributions and Taxes."
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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 and services fees at an annual
rate of 0.25% of the Fund's aggregate average daily net assets attributable to
the Class A Shares. In addition, certain purchases of Class A Shares qualify for
reduced initial sales charges.
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.
Class B Shares are subject to an ongoing distribution and services fee at an
aggregate 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 and 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 Distributor to have been compensated for
distribution expenses related to the Class B Shares from most of the burden of
such distribution related expenses.
Class B Shares include all shares purchased pursuant to the deferred sales
charge alternative which would 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 and 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.
For purposes of conversion to Class A Shares, 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
subaccount. Each time any Class B Shares in the shareholder's Fund account
(other than those in the subaccount) convert to Class A, an equal pro rata
portion of the Class B Share dividends in the subaccount will also convert to
Class A Shares.
CLASS C SHARES
Class C Shares are purchased without an initial sales charge but are subject
to a deferred sales charge if redeemed within one year of purchase. The deferred
sales charge may be waived in connection with certain qualifying redemptions.
Shares issued in conjunction with the automatic reinvestment of income
distributions and capital gain distributions are not subject to any sales
charges. Class C Shares are subject to an ongoing distribution and services fee
at an aggregate annual rate of up to 1.00% of the Fund's aggregate average daily
net assets attributable to Class C Shares.
CLASS A SHARES--REDUCED INITIAL SALES CHARGES
Investors choosing Class A Shares may be entitled to reduced sales charges.
The ways in which sales charges may be avoided or reduced are described below.
QUALIFIED PURCHASERS. If you fall within any one of the following categories,
you will not have to pay a sales charge on your purchase of Class A Shares: (1)
trustee, director or officer of the Phoenix Funds, the Phoenix-Engemann Funds,
Phoenix-Seneca Funds or any other mutual fund advised, subadvised or distributed
by the Adviser, Distributor or any of their corporate affiliates; (2) any
director or officer, or any full-time employee or sales representative (for at
least 90 days), of the Adviser or Distributor; (3) registered representatives
and employees of securities dealers with whom Distributor 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
Distributor; (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, Distributor and/or their corporate affiliates; (8) any
employee or agent who retires from Phoenix Home Life, Distributor and/or their
corporate affiliates; (9) any account held in the name of a 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 eligible employees; (10) any person with a direct rollover transfer of
shares from an established Phoenix Fund, Phoenix-Engemann Fund or Phoenix-Seneca
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, department, authority or similar agency prohibited by law
from paying a sales charge; (13) any fully matriculated student in any U.S.
service academy; (14) any unallocated account 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 $1,000,000; (15) any person who is
investing redemption proceeds from investment companies other than the Phoenix
Funds, Phoenix-Engemann Fund or Phoenix-Seneca Fund 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;
(16) any deferred compensation plan established for the benefit of any Phoenix
Fund, Phoenix-Engemann
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Fund or Phoenix-Seneca Fund trustee or director; provided that sales to persons
listed in (1) through (16) 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; (17) purchasers of Class A
Shares bought through investment advisers and financial planners who charge an
advisory, consulting or other fee for their services and buy shares for their
own accounts or the accounts of their clients; (18) retirement plans and
deferred compensation plans and trusts used to fund those plans (including, for
example, plans qualified or created under sections 401(a), 403(b) or 457 of the
Internal Revenue Code), and "rabbi trusts" that buy shares for their own
accounts, in each case if those purchases are made through a broker or agent or
other financial intermediary that has made special arrangements with the
Distributor for such purchases; (19) 401(k) participants in the Merrill Lynch
Daily K Plan (the "Plan") if the Plan has at least $3 million in assets or 500
or more eligible employees; or (20) clients of investment advisors or financial
planners who buy shares for their own accounts but only if their accounts are
linked to a master account of their investment advisor or financial planner on
the books and records of the broker, agent or financial intermediary with which
the Distributor has made such special arrangements. Each of the investors
described in (17) through (20) may be charged a fee by the broker, agent or
financial intermediary for purchasing shares.
COMBINATION PURCHASE PRIVILEGE. Your purchase of any class of shares of
this or any other Affiliated Phoenix Fund (other than Phoenix Money Market Fund
and Phoenix-Zweig Government Cash Fund Class A Shares), if made at the same time
by the same "person," will be added together to determine whether the combined
sum entitles you to an immediate reduction in sales charges. A "person" is
defined in this and the following sections as (a) any individual, their spouse
and minor children purchasing shares for his or their own account (including an
IRA account) including his or their own trust; (b) a trustee or other fiduciary
purchasing for a single trust, estate or single fiduciary account (even though
more than one beneficiary may exist); (c) multiple employer trusts or Section
403(b) plans for the same employer; (d) multiple accounts (up to 200) under a
qualified employee benefit plan or administered by a third-party administrator;
or (e) 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 of record in the name, or nominee name, of the entity
placing the order.
An "Affiliated Phoenix Fund" means any other mutual fund advised, subadvised
or distributed by the Adviser or Distributor or any corporate affiliate of
either or both the Adviser and Distributor provided such other mutual fund
extends reciprocal privileges to shareholders of the Phoenix Funds.
LETTER OF INTENT. If you sign a Letter of Intent, your purchase of any class
of shares of this or any other Affiliated Phoenix Fund (other than Phoenix Money
Market Fund and Phoenix-Zweig Government Cash Fund Class A Shares), if made by
the same person within a thirteen-month period, will be added together to
determine whether you are entitled to an immediate reduction in sales charges.
Sales charges are reduced based on the overall amount you indicate that you will
buy under the Letter of Intent. The Letter of Intent is a mutually nonbinding
arrangement between you and the Distributor. Since the Distributor doesn't know
whether you will ultimately fulfill the Letter of Intent, shares worth 5% of the
amount of each purchase will be set aside until you fulfill the Letter of
Intent. When you buy enough shares to fulfill the Letter of Intent, these shares
will no longer be restricted. If, on the other hand, you do not satisfy the
Letter of Intent, or otherwise wish to sell any restricted shares, you will be
given the choice of either buying enough shares to fulfill the Letter of Intent
or paying the difference between any sales charge you previously paid and the
otherwise applicable sales charge based on the intended aggregate purchases
described in the Letter of Intent. You will be given 20 days to make this
decision. If you do not exercise either election, the Distributor will
automatically redeem the number of your restricted shares needed to make up the
deficiency in sales charges received. The Distributor will redeem restricted
Class A Shares before Class C or B Shares, respectively. Oldest shares will be
redeemed before selling newer shares. Any remaining shares will then be
deposited to your account.
RIGHT OF ACCUMULATION. Your purchase of any class of shares of this or any
other Affiliated Phoenix Fund, if made over time by the same person may be added
together to determine whether the combined sum entitles you to a prospective
reduction in sales charges. You must provide certain account information to the
Distributor to exercise this right.
ASSOCIATIONS. Certain groups or associations may be treated as a "person" and
qualify for reduced Class A Share sales charges. The group or association must:
(1) have been in existence for at least six months; (2) have a legitimate
purpose other than to purchase mutual fund shares at a reduced sales charge; (3)
work through an investment dealer; or (4) not be a group whose sole reason for
existing is to consist of members who are credit card holders of a particular
company, policyholders of an insurance company, customers of a bank or a
broker-dealer or clients of an investment adviser.
CLASS B SHARES--WAIVER OF SALES CHARGES
The CDSC is waived on the redemption (sale) of Class B and C Shares if the
redemption is made (a) 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
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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) within
one year of disability, as defined in Code Section 72(m)(7); (c) as a mandatory
distribution upon reaching age 70 1/2 under any retirement plan qualified under
Code Sections 401, 408 or 403(b) or resulting from the tax-free return of an
excess contribution to an IRA; (d) 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) from the Merrill Lynch
Daily K Plan ("Plan") invested in Class B Shares, on which such shares the
Distributor has not paid the dealer the Class B salescommission; (f) based on
the exercise of exchange privileges among Class B and C Shares of this or any
other Affiliated Phoenix Fund; (g) based on any direct rollover transfer of
shares from an established Affiliated Phoenix Fund qualified plan into an
Affiliated Phoenix Fund IRA by participants terminating from the qualified plan;
and (h) based on the systematic withdrawal program (Class B Shares only). If, as
described in condition (a) above, an account is transferred to an account
registered in the name of a deceased's estate, the CDSC 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 subject to the applicable CDSC when redeemed.
CONVERSION FEATURE--CLASS B SHARES
Class B Shares will automatically convert to Class A Shares of the same Fund
eight years after they are bought. Conversion will be on the basis of the then
prevailing net asset value for Class A and B Shares. There is no sales load, fee
or other charge for this feature. Class B Shares acquired through dividend or
distribution reinvestments will be converted into Class A Shares at the same
time that other Class B Shares are converted based on the proportion that the
reinvested shares bear to purchased Class B Shares. The conversion feature is
subject to the continuing availability of an opinion of counsel or a ruling of
the Internal Revenue Service that the assessment of the higher distribution fees
and associated costs with respect to Class B Shares does not result in any
dividends or distributions constituting "preferential dividends" under the Code,
and that the conversion of shares does not constitute a taxable event under
federal income tax law. If the conversion feature is suspended, Class B Shares
would continue to be subject to the higher distribution fee for an indefinite
period. Even if the Funds were unable to obtain such assurances, it might
continue to make distributions if doing so would assist in complying with its
general practice of distributing sufficient income to reduce or eliminate
federal taxes otherwise payable by the Funds.
INVESTOR ACCOUNT SERVICES
The Fund offers accumulation plans, withdrawal plans and reinvestment and
exchange privileges. Certain privileges may not be available in connection with
all classes. In most cases, changes to account services may be accomplished over
the phone. Inquiries regarding policies and procedures relating to shareholder
account services should be directed to Shareholder Services at (800) 243-1574.
Broker/dealers may impose their own restrictions and limits on accounts held
through the broker/dealer. Please contact your broker/dealer for account
restriction and limit information.
EXCHANGES
Under certain circumstances, shares of the Fund may be exchanged for shares
of the same class of any other Affiliated Phoenix Fund 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 Series,
Fund, or Portfolio, 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 of any other Affiliated
Phoenix Fund, if currently offered. Exchanges will be based upon each Fund's net
asset value per share next computed after the close of business on the 10th day
of each month (or next succeeding business day), without sales charge. On
exchanges with share classes that carry a contingent deferred sales charge, the
CDSC schedule of the original shares purchased continues to apply. The exchange
of shares is treated as a sale and purchase for federal income tax purposes (see
also "Dividends, Distributions and Taxes").
SYSTEMATIC EXCHANGES. If the conditions above have been met, you or your
broker may, by telephone or written notice, elect to have shares exchanged for
the same class of shares of another Affiliated Phoenix Fund automatically on a
monthly, quarterly, semi-annual or annual basis or may cancel this privilege at
any time. If you 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), you may direct that shares be
automatically exchanged at predetermined intervals for shares of the same class
of another Affiliated Phoenix Fund. This requirement does not apply to Phoenix
"Self Security" program participants. Systematic exchanges will be executed upon
the close of business on the 10th day of each month or the next succeeding
business day. Systematic exchange forms are available from the Distributor.
DIVIDEND REINVESTMENT ACROSS ACCOUNTS
If you 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), you 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 Affiliated Phoenix Funds at
net asset value. You should obtain a current prospectus and consider the
objectives and policies of each fund carefully before
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directing dividends and distributions to another fund. Reinvestment election
forms and prospectuses are available from Equity Planning. Distributions may
also be mailed to a second payee and/or address. Requests for directing
distributions to an alternate payee must be 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 your account are
repurchased or redeemed or transferredbetween the record date and the payment
date of a dividend or distribution, you will receive cash for the dividend or
distribution regardless of the distribution option selected.
INVEST-BY-PHONE
This expedited investment service allows a shareholder to make an investment
in an account by requesting a transfer of funds from the balance of their bank
account. Once a request is phoned in, Equity Planning will initiate the
transaction by wiring a request for monies to the shareholder's commercial bank,
savings bank or credit union via Automated Clearing House (ACH). The
shareholder's bank, which must be an ACH member, will in turn forward the monies
to Equity Planning for credit to the shareholder's account. ACH is a
computer-based clearing and settlement operation established for the exchange of
electronic transactions among participating depository institutions.
To establish this service, please complete an Invest-by-Phone Application and
attach a voided check if applicable. Upon Equity Planning's acceptance of the
authorization form (usually within two weeks) shareholders may call toll free
(800) 367-5877 prior to 3:00 p.m. (New York time) to place their purchase
request. Instructions as to the account number and amount to be invested must be
communicated to Equity Planning. Equity Planning will then contact the
shareholder's bank via ACH with appropriate instructions. The purchase is
normally credited to the shareholder's account the day following receipt of the
verbal instructions. This service may also be used to request redemption of
shares of the Money Market Fund, the proceeds of which are transferred to the
shareholder's bank the second day following receipt of the verbal request. The
Trust may delay the mailing of a check for redemption proceeds of Trust shares
purchased with a check or via Invest-by-Phone service until the Trust has
assured itself that good payment has been collected for the purchase of the
shares, which may take up to 15 days. The Fund and Equity Planning reserve the
right to modify or terminate the Invest-by-Phone service for any reason or to
institute charges for maintaining an Invest-by-Phone account.
SYSTEMATIC WITHDRAWAL PROGRAM
The Systematic Withdrawal Program allows you to periodically redeem a portion
of your account on a predetermined monthly, quarterly, semiannual or annual
basis. A sufficient number of full and fractional shares will 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 your 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.
Shareholders participating in the Systematic Withdrawal program must own
shares of a Series worth $5,000 or more, as determined by the then current net
asset value per share, and elect to have all dividends reinvested. Participants
in the Program redeeming Class C Shares will be subject to any applicable
contingent deferred sales charge. 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 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.
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
investment each quarter without incurring otherwise applicable contingent
deferred sales charges. Class B shareholders redeeming more shares than the
percentage permitted by the withdrawal program will be subject to any applicable
contingent deferred sales charge on all shares redeemed. 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.
HOW TO REDEEM 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 therefore postponed during periods when the New York Stock Exchange is
closed, other 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
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proceeds until checks received for shares purchased have cleared, which may take
up to 15 days after receipt of the check. Redemptions by Class B and Class C
shareholders will be subject to the applicable deferred sales charge, if any.
The Fund has authorized one or more brokers to accept on its behalf purchase
and redemption orders. Such brokers are authorized to designate other
intermediaries to accept purchase and redemption orders on the Fund's behalf.
The Fund will be deemed to have received a purchase or redemption order when an
authorized broker or, if applicable, a broker's authorized
designee, accepts the order. Customer orders will be priced at the Fund's net
asset value next computed after they are accepted by an authorized broker or the
broker's authorized designee.
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.
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.
BY MAIL
Shareholders may redeem shares by making written request, executed in the
full name of the account, directly to Phoenix Funds c/o State Street Bank and
Trust Company, P.O. Box 8301, Boston, MA 02266-8301. However, when certificates
for shares are in the possession of the shareholder, they must be mailed or
presented, duly endorsed in the full name of the account, with a written request
to Equity Planning that the Fund redeem the shares. See the Fund's current
Prospectus for more information.
TELEPHONE REDEMPTIONS
Shareholders may redeem by telephone up to $50,000 worth of their shares held
in book-entry form. See the Fund's current Prospectus for additional
information.
REDEMPTION IN KIND
To the extent consistent with state and federal law, the Fund may make
payment of the redemption price either in cash or in kind. However, the Fund has
elected to pay in cash all requests for redemption by any shareholder of record,
limited in respect to each shareholder during any 90-day period to the lesser of
$250,000 or 1% of the net asset value of the Fund at the beginning of such
period. This election has been made pursuant to Rule 18f-1 under the Investment
Company Act of 1940 and is irrevocable while the Rule is in effect unless the
Securities and Exchange Commission, by order, permits the withdrawal thereof. In
case of a redemption in kind, securities delivered in payment for shares would
be readily marketable and valued at the same value assigned to them in computing
the net asset value per share of the Fund. A shareholder receiving such
securities would incur brokerage costs when selling the securities.
ACCOUNT REINSTATEMENT 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.
TAX SHELTERED RETIREMENT PLANS
Shares of the Trust are offered in connection with the following qualified
prototype retirement plans: IRA, Rollover IRA, SEP-IRA, SIMPLE, IRA, Roth IRA,
401(k), Profit-Sharing, Money Purchase Pension Plans and 403(b) Retirement
Plans. Write or call Equity Planning (800) 243-4361 for further information
about the plans.
MERRILL LYNCH DAILY K PLAN
Class A Shares of a Fund are made available to Merrill Lynch Daily K Plan
(the "Plan") participants at NAV without an initial sales charge if:
(i) the Plan is recordkept on a daily valuation basis by Merrill Lynch and,
on the date the Plan Sponsor signs the Merrill Lynch Recordkeeping
Service Agreement, the Plan has $3 million or more in assets invested in
broker/dealer funds not advised or managed by Merrill Lynch Asset
Management L.P. (MLAM) that are made available pursuant to a Service
Agreement between Merrill Lynch and the fund's principal underwriter or
distributor and in funds advised or managed by MLAM (collectively, the
"Applicable Investments");
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(ii) the Plan is recordkept on a daily valuation basis by an independent
recordkeeper whose services are provided through a contract or alliance
arrangement with Merrill Lynch, and, on the date the Plan Sponsor signs
the Merrill Lynch Recordkeeping Service Agreement, the Plan has $3
million or more in assets, excluding money market funds, invested in
Applicable Investments; or
(iii) the Plan has 500 or more eligible employees, as determined by a Merrill
Lynch plan conversion manager, on the date the Plan Sponsor signs the
Merrill Lynch Recordkeeping Service Agreement.
Alternatively, Class B Shares of a Fund are made available to Plan
participants at NAV without a CDSC if the Plan conforms with the requirements
for eligibility set for in (i) through (iii) above but either does not meet the
$3 million asset threshold or does not have 500 or more eligible employees.
Plans recordkept on a daily basis by Merrill Lynch or an independent
recordkeeper under a contract with Merrill Lynch that are currently investing in
Class B Shares of a Fund convert to Class A Shares once the Plan has reached $5
million invested in Applicable Investments, or after the normal holding period
of seven years from the initial date of purchase.
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) 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 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.
14
<PAGE>
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 foregoingdistribution
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
and payable to shareholders of record on a specified date in such a month 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.
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.
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.
15
<PAGE>
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 DISTRIBUTOR
Phoenix Equity Planning Corporation, ("Equity Planning" or "Distributor"),
acts as the Distributor of the Fund and as such will conduct 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. Equity Planning is an
indirect less than wholly-owned subsidiary of Phoenix Home Life Mutual Insurance
Company and an affiliate of PIC. Shares of the Fund may be purchased through
investment dealers who have sales agreements with the Distributor. During the
fiscal years 1998, 1999, and 2000, purchasers of shares of the Fund paid
aggregate sales charges of $115,136, $138,575 and $________, respectively, of
which the Distributor received net commissions of $36,903, $45,521 and
$________, respectively, for its services, the balance being paid to dealers.
For the fiscal year ended June 30, 2000, the Distributor received net
commissions of $________ for Class A shares and deferred sales charges of
$________ for Class B and Class C Shares.
The Underwriting Agreement may be terminated at any time on not more than 60
days written notice, without payment of a penalty, by the Distributor, 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 Plans or in any related agreements. The Underwriting Agreement will
terminate automatically in the event of its assignment.
DEALER CONCESSIONS
Dealers with whom the Distributor has entered into sales agreements receive a
discount or commission as set forth below.
<TABLE>
<CAPTION>
AMOUNT OF DEALER DISCOUNT
TRANSACTION SALES CHARGE AS PERCENTAGE SALES CHARGE AS PERCENTAGE OR AGENCY FEE AS
AT OFFERING PRICE OF OFFERING PRICE OF AMOUNT INVESTED PERCENTAGE OF OFFERING PRICE
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $50,000 5.75% 6.10% 5.25%
$50,000 but under $100,000 4.75% 4.99% 4.25%
$100,000 but under $250,000 3.75% 3.90% 3.25%
$250,000 but under $500,000 2.75% 2.83% 2.25%
$500,000 but under $1,000,000 2.00% 2.04% 1.75%
$1,000,000 or more None None None
</TABLE>
In addition to the dealer discount on purchases of Class A Shares, the
Distributor intends to pay investment dealers a sales commission of 4% of the
sale price of Class B Shares and a sales commission of 1% of the sale price of
Class C Shares sold by such dealers. This sales commission will not be paid to
dealers for sales of the Class B or Class C Shares purchased by 401(k)
participants of the Merrill Lynch Daily K Plan due to a waiver of the CDSC for
these Plan participants' purchases. Your broker, dealer or investment adviser
may also charge you additional commissions or fees for their services in selling
shares to you provided they notify the Distributor of their intention to do so.
Dealers and other entities who enter into special arrangements with the
Distributor may receive compensation for the sale and promotion of shares of the
Funds and/or for providing other shareholder services. Such fees are in addition
to the sales commissions referenced above and may be used based upon the amount
of sales of fund shares by a dealer; the provision of assistance in marketing of
fund shares; access to sales personnel and information dissemination services;
provision of recordkeeping and administrative services to qualified employee
benefit plans; and other criteria as established by the Distributor. Depending
on the nature of the services, these fees may be paid either from the Funds
through distribution fees, service fees or transfer agent fees or in some cases,
the Distributor may pay certain fees from its own profits and resources. From
its own profits and resources, the Distributor does intend to: (a) sponsor sales
contests, training and educational meetings and provide additional compensation
to qualifying dealers in the form of trips, merchandise or expense
reimbursements; (b) from time to time pay special incentive and retention fees
to qualified wholesalers, registered financial institutions and third party
16
<PAGE>
marketers; (c) pay broker/dealers an amount equal to 1% of the first $3 million
of Class A Share purchases by an account held in the name of a qualified
employee benefit plan with at least 100 eligible employees, 0.50% on the next $3
million, plus 0.25% on the amount in excess of $6 million; and (d) excluding
purchases as described in (c) above, pay broker/dealers an amount equal to 1% of
the amount of Class A Shares sold above $1 million but under $3 million, 0.50%
on the next $3 million, plus 0.25% on the amount in excess of $6 million. 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 Distributor such amounts paid with respect
to the investment. In addition, the Distributor may pay the entire applicable
sales charge on purchases of Class A Shares to selected dealers and agents. From
its own resources, the Distributor intends to pay the following additional
compensation to Merrill Lynch, Pierce, Fenner & Smith, Incorporated; 0.25% on
sales of Class A and B Shares, 0.10% on sales of Class C Shares, 0.10% on Sales
of Class A Shares sold at net asset value, and 0.10% annually on the average
daily net asset value of fund shares on which Merrill Lynch is broker of record
and which such shares exceed the amount of assets on which Merrill Lynch is
broker of record as of July 1, 1999. Any dealer who receives more than 90% of a
sales charge may be deemed to be an "underwriter" under the Securities Act of
1933. Equity Planning reserves the right to discontinue or alter such fee
payment plans at any time.
From its own resources or pursuant to the Plan, and subject to the dealers'
prior approval, the Distributor may provide additional compensation to
registered representatives of dealers in the form of travel expenses, meals, and
lodging associated with training and educational meetings sponsored by the
Distributor. The Distributor may also provide gifts amounting in value to less
than $100, and occasional meals or entertainment, to registered representatives
of dealers. Any such travel expenses, meals, lodging, gifts or entertainment
paid will not be preconditioned upon the registered representatives' or dealers'
achievement of a sales target. The Distributor 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.
ADMINISTRATIVE SERVICES
Equity Planning also acts as administrative agent of the Fund and as such
performs administrative, bookkeeping and pricing functions for the Fund. For its
services, Equity Planning will be paid a fee equal to the sum of (1) the
documented cost of fund accounting and related services provided by PFPC, Inc.,
as subagent, plus (2) the documented cost to Equity Planning to provide
financial reporting and tax services and to oversee the subagent's performance.
The current fee schedule of PFPC, Inc. is based upon the average of the
aggregate daily net asset values of the Fund, at the following incremental
annual rates.
First $200 million .085%
$200 million to $400 million .05%
$400 million to $600 million .03%
$600 million to $800 million .02%
$800 million to $1 billion .015%
Greater than $1 billion .0125%
Percentage rates are applied to the aggregate daily net asset values of the
Fund. PFPC, Inc. also charges minimum fees and additional fees for each
additional class of fund shares. Equity Planning retains PFPC, Inc. as subagent
for each of the funds for which Equity Planning serves as administrative agent.
PFPC, Inc. agreed to a modified fee structure and waived certain charges.
Because PFPC, Inc.'s arrangement would have favored smaller funds over larger
funds, Equity Planning reallocates PFPC, Inc.'s overall asset-based charges
among all funds for which it serves as administrative agent on the basis of the
relative net assets of each fund. As a result, the PFPC, Inc. charges to the
Fund are expected to be slightly less than the amount that would be found
through direct application of the table illustrated above. For its services
during the Fund's fiscal years ended June 30, 1998, 1999 and 2000, Equity
Planning received fees of $________, $182,694 and $________, respectively.
DISTRIBUTION PLANS
The Trust has adopted a distribution plan for each class of shares (i.e., a
plan for the Class A Shares, a plan for the Class B Shares, and a plan for the
Class C Shares, collectively, the "Plans") in accordance with Rule 12b-1 under
the Act, to compensate the Distributor for the services it provides and for the
expenses it bears under the Underwriting Agreement. Each class of shares pays a
service fee at a rate of 0.25% per annum of the average daily net assets of such
class of the Fund and a distribution fee based on average daily net assets at
the following rates: for Class B Shares at a rate of 0.75% per annum.
From the Service Fee the Distributor 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
Distributor.
17
<PAGE>
For the fiscal year ended June 30, 2000 the Fund paid Rule 12b-1 Fees in the
amount of $________, of which the Distributor received $________, W.S. Griffith
& Co., an affiliate, received $________ and unaffiliated broker-dealers received
$________. The Rule 12b-1 payments were used for (1) compensation to dealers,
$______, (2) compensation to sales personnel, $______, (3) advertising, $_____,
(4) service costs, $_____, (5) printing and mailing of prospectuses to other
than current shareholders, $_____ and (6) other, $______.
On a quarterly basis, the Fund's Trustees review a report on expenditures
under the Plans and the purposes for which expenditures were made. The Trustees
conduct an additional, more extensive review annually in determining whether the
Plans will be continued. By their 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 provide
that while they are 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. The Trustees have concluded that there is a reasonable likelihood
that the Plans will benefit the Fund and all classes of shareholders.
No interested person of the Fund and no Director who is not an interested
person of the Fund, as that term is defined in the Investment Company Act of
1940, had any direct or indirect financial interest in the operation of the
Plans.
The National Association of Securities Dealers, Inc. (the "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 the Plans.
MANAGEMENT OF THE FUND
The Fund an open-end management investment company known as a mutual fund.
The Trustees of the Fund ("Trustees") are responsible for the overall
supervision of the operations of the Fund and perform the various duties imposed
on Trustees by the 1940 Act and Delaware business trust law.
TRUSTEES AND OFFICERS
The following table sets forth information concerning the Trustees and
executive 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 56 Prospect Street, Hartford, Connecticut, 06115. The Trustees
and executive officers are listed below:
<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME, ADDRESS AND AGE WITH THE FUND DURING THE PAST 5 YEARS
--------------------- ------------- -----------------------
<S> <C> <C>
Robert Chesek (66) Trustee Trustee/Director (1981-present) and Chairman (1989-1994), Phoenix
49 Old Post Road Funds. Trustee, Phoenix-Aberdeen Series Fund, Phoenix Duff &
Wethersfield, CT 06109 Phelps Institutional Mutual Funds (1996-present) and
Phoenix-Seneca Funds (2000-present).
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME, ADDRESS AND AGE WITH THE FUND DURING THE PAST 5 YEARS
--------------------- ------------- -----------------------
<S> <C> <C>
E. Virgil Conway (71) Trustee Chairman, Metropolitan Transportation Authority (1992-present).
9 Rittenhouse Road Trustee/Director, Consolidated Edison Company of New York, Inc.
Bronxville, NY 10708 (1970-present), Pace University (1978-present), 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), Blackrock Freddie Mac Mortgage
Securities Fund (Advisory Director) (1990-present), Centennial
Insurance Company (1974-present), Josiah Macy, Jr., Foundation
(1975-present), The Harlem Youth Development Foundation
(1987-present), Accuhealth (1994-present), Trism, Inc.
(1994-present), Realty Foundation of New York (1972-present), New
York Housing Partnership Development Corp. (Chairman)
(1981-present) and Academy of Political Science (Vice Chairman)
(1985-present). Director/Trustee, Phoenix Funds (1993-present).
Trustee, Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps
Institutional Mutual Funds (1996-present) and Phoenix-Seneca Funds
(2000-present). Director, Duff & Phelps Utilities Tax-Free Income
Inc. and Duff & Phelps Utility and Corporate Bond Trust Inc.
(1995-present). Advisory Director, Fund Directions (1993-1998).
Chairman/Member, Audit Committee of the City of New York
(1981-1996). Advisory Director, Blackrock Fannie Mae Mortgage
Securities Fund (1989-1996). Member (1990-1995), Chairman
(1992-1995), Financial Accounting Standards Advisory Council.
Advisory Director, Blackrock Fannie Mae Mortgage Securities Fund
(1989-1996).
Harry Dalzell-Payne (71) Trustee Director/Trustee, Phoenix Funds (1983-present). Trustee,
The Flat Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
Elmore Court Mutual Funds (1996-present) and Phoenix-Seneca Funds
Elmore, GLOS GL 2 (1999-present). Director, Duff & Phelps Utilities Tax-Free Income
6NT, UK Inc. and Duff & Phelps Utility and Corporate Bond Trust Inc.
(1995-present). Formerly a Major General of the British Army.
*Francis E. Jeffries (69) Trustee Director/Trustee, Phoenix Funds (1995-present). Trustee,
8477 Bay Colony Dr. Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
#902 Mutual Funds (1996-present) and Phoenix-Seneca Funds
Naples, FL 34108 (2000-present). Director, Duff & Phelps Utilities Income Inc.
(1987-present), Duff & Phelps Utilities Tax-Free Income Inc.
(1991-present) and Duff & Phelps Utility and Corporate Bond Trust
Inc. (1993-present). Director, The Empire District Electric
Company (1984-present). Director (1989-1997), Chairman of the
Board (1993-1997), President (1989-1993), and Chief Executive
Officer (1989-1995), Phoenix Investment Partners, Ltd.
Leroy Keith, Jr. (61) Trustee Chairman (1995-present) and Chief Executive Officer (1995-1999),
Chairman Carson Products Company. Director/Trustee, Phoenix Funds
Carson Products Company (1980-present). Trustee, Phoenix-Aberdeen Series Fund, Phoenix
64 Ross Road Duff & Phelps Institutional Mutual Funds (1996-present) and
Savannah, GA 30750 Phoenix-Seneca Funds (2000-present). Director, Equifax Corp.
(1991-present) and Evergreen International Fund, Inc.
(1989-present). Trustee, Evergreen Liquid Trust, Evergreen Tax
Exempt Trust, Evergreen Tax Free Fund, Master Reserves Tax Free
Trust, and Master Reserves Trust.
</TABLE>
19
<PAGE>
<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME, ADDRESS AND AGE WITH THE FUND DURING THE PAST 5 YEARS
--------------------- ------------- -----------------------
<S> <C> <C>
*Philip R. McLoughlin (53) Trustee and Chairman (1997-present), Director (1995-present), Vice Chairman
President (1995-1997) and Chief Executive Officer (1995-present), Phoenix
Investment Partners, Ltd. Director (1994-present) and Executive
Vice President, Investments (1988-present), Phoenix Home Life
Mutual Insurance Company. Director/Trustee and President, Phoenix
Funds (1989-present). Trustee and President, Phoenix-Aberdeen
Series Fund and Phoenix Duff & Phelps Institutional Mutual Funds
(1996-present). Director, Duff & Phelps Utilities Tax-Free Income
Inc. (1995-present) and Duff & Phelps Utility and Corporate Bond
Trust Inc. (1995-present). Trustee, Phoenix-Seneca Funds
(1999-present). Director (1983-present) and Chairman
(1995-present), Phoenix Investment Counsel, Inc. Director
(1984-present) and President (1990-1999), 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), PXRE Corporation (Delaware) (1985-present), and
World Trust Fund (1991-present). Director and Executive Vice
President, Phoenix Life and Annuity Company (1996-present).
Director and Executive Vice President, PHL Variable Insurance
Company (1995-present). Director, Phoenix Charter Oak Trust
Company (1996-present). Director and Vice President, PM Holdings,
Inc. (1985-present). Director, PHL Associates, Inc.
(1995-present). Director (1992-present) and President (1992-1994),
W.S. Griffith & Co., Inc.
Everett L. Morris (72) Trustee Vice President, W.H. Reaves and Company (1993-present).
164 Laird Road Director/Trustee, Phoenix Funds (1995-present). Trustee,
Colts Neck, NJ 07722 Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
Mutual Funds (1996-present) and Phoenix-Seneca Funds
(2000-present). Director, Duff & Phelps Utilities Tax-Free Income
Inc. (1991-present) and Duff & Phelps Utility and Corporate Bond
Trust Inc. (1993-present).
*James M. Oates (53) Trustee Chairman, IBEX Capital Markets, Inc. (formerly IBEX Capital
Managing Director Markets LLC) (1997-present). Managing Director, Wydown Group
The Wydown Group (1994-present). Director, Phoenix Investment Partners, Ltd.
IBEX Capital Markets, Inc. (1995-present). Director/Trustee, Phoenix Funds (1987-present).
60 State Street Trustee, Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps
Suite 950 Institutional Mutual Funds (1996-present) and Phoenix-Seneca
Boston, MA 02109 Funds (2000 present). Director, AIB Govett Funds (1991-present),
Investors Financial Service Corporation (1995-present), Investors
Bank & Trust Corporation (1995-present), Plymouth Rubber Co.
(1995-present), Stifel Financial (1996-present), Command Systems,
Inc. (1998-present), Connecticut River Bancorp (1998-present) and
Endowment for Health (1999-present). Vice Chairman, Massachusetts
Housing Partnership (1992-present). Member, Chief Executives
Organization (1996-present). Director, Blue Cross and Blue Shield
of New Hampshire (1994-1999).
</TABLE>
20
<PAGE>
<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME, ADDRESS AND AGE WITH THE FUND DURING THE PAST 5 YEARS
--------------------- ------------- -----------------------
<S> <C> <C>
Herbert Roth, Jr. (71) Trustee Director/Trustee, Phoenix Funds (1980-present). Trustee,
134 Lake Street Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
P.O. Box 909 Mutual Funds (1996-present) and Phoenix-Seneca Funds
Sherborn, MA 01770 (2000-present). Director, Boston Edison Company (1978-present),
Landauer, Inc. (medical services) (1970-present), Tech
Ops./Sevcon, Inc. (electronic controllers) (1987-present), and
Mark IV Industries (diversified manufacturer) (1985-present).
Member, Directors Advisory Counsel, Phoenix Home Life Mutual
Insurance Company (1998-present). Director, Key Energy Group (oil
rig service) (1988-1994) and Phoenix Home Life Mutual Insurance
Company (1972-1998).
Richard E. Segerson (54) Trustee Managing Director, Northway Management Company (1998- present).
102 Valley Road Director/Trustee, Phoenix Funds (1993-present). Trustee,
New Canaan, CT 07840 Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
Mutual Funds (1996-present) and Phoenix-Seneca Funds
(2000-present). Managing Director, Mullin Associates (1993-1998).
Lowell P. Weicker, Jr. (69) Trustee Trustee/Director, Phoenix Funds (1995-present). Trustee,
731 Lake Avenue Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional
Greenwich, CT 06830 Mutual Funds (1996-present) and Phoenix-Seneca Funds
(2000-present). Director, UST Inc. (1995-present), Burroughs
Wellcome Fund (1996-present), HPSC Inc. (1995-present), and
Compuware (1996-present). Visiting Professor, University of
Virginia (1997-present). Director, Duty Free International, Inc.
(1997). Chairman, Dresing, Lierman, Weicker (1995-1996). Governor
of the State of Connecticut (1991-1995).
Michael E. Haylon (42) Executive Director and Executive Vice President--Investments, Phoenix
Vice Investment Partners, Ltd. (1995-present). Executive Vice
President President, Phoenix Funds (1993-present) and Phoenix-Aberdeen
Series Fund (1996-present). Executive Vice President
(1997-present), Vice President (1996-1997), Phoenix Duff & Phelps
Institutional Mutual Funds. Director (1994-present), President
(1995-present), Executive Vice President (1994-1995), Vice
President (1991-1994), Phoenix Investment Counsel, Inc. Director,
Phoenix Equity Planning Corporation (1995-present). Senior Vice
President, Securities Investments, Phoenix Home Life Mutual
Insurance Company (1993-1995).
John F. Sharry (47) Executive President, Retail Division (1999-present), Executive Vice
Vice President, Retail Division (1997-1999), Phoenix Investment
President Investment Partners, Ltd. President, Retail Division
(1999-present), Managing Director, Retail (1995-1999),
Phoenix Equity Planning Corporation. Executive Vice
President, Phoenix Funds, Phoenix-Aberdeen Series Fund
(1998-present) and Phoenix-Seneca Funds (2000-present).
Managing Director, Director and National Sales
Manager (1993- 1995), Senior Vice President, Director
and National Sales Manager (1992-1993), Putnam Funds.
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
POSITIONS HELD PRINCIPAL OCCUPATION(S)
NAME, ADDRESS AND AGE WITH THE FUND DURING THE PAST 5 YEARS
--------------------- ------------- -----------------------
<S> <C> <C>
Robert S. Driessen (52) Vice President Vice President and Compliance Officer, Phoenix Investment
and Assistant Partners, Ltd. (1999-present) and Phoenix Investment Counsel, Inc.
Secretary (1999-present). Vice President, Phoenix Funds, Phoenix-Aberdeen
Series Fund, Phoenix Duff & Phelps Institutional Mutual Funds
(1999-present) and Phoenix-Seneca Funds (2000-present). Compliance
Officer (2000-present) and Associate Compliance Officer (1999),
PXP Securities Corporation. Vice President, Risk Management
Liaison, Bank of America (1996-1999). Vice President, Securities
Compliance, The Prudential Insurance Company of America
(1993-1996). Branch Chief/Financial Analyst, Securities and
Exchange Commission, Division of Investment Management (1972-1993).
William R. Moyer (55) Vice Executive Vice President and Chief Financial Officer
100 Bright Meadow Blvd. President (1999-present), Senior Vice President and Chief Financial Officer
P.O. Box 2200 (1995-1999), Phoenix Investment Partners, Ltd. Director
Enfield, CT 06083-2200 (1998-present), Senior Vice President, Finance (1990-present),
Chief Financial Officer (1996-present), and Treasurer (1994-1996
and 1998-present), Phoenix Equity Planning Corporation. Director
(1998-present), Senior Vice President (1990-present), Chief
Financial Officer (1996-present) and Treasurer (1994-present),
Phoenix Investment Counsel, Inc. Senior Vice President and Chief
Financial Officer, Duff & Phelps Investment Management Co.
(1996-present). Vice President, Phoenix Funds (1990-present),
Phoenix-Duff & Phelps Institutional Mutual Funds (1996-present),
Phoenix-Aberdeen Series Fund (1996-present). Executive Vice
President, Phoenix-Seneca Funds (2000-present). Vice President,
Investment Products Finance, Phoenix Home Life Mutual Insurance
Company (1990-1995).
Nancy G. Curtiss (47) Treasurer Vice President, Fund Accounting (1994-present) and Treasurer
(1996-present), Phoenix Equity Planning Corporation. Treasurer,
Phoenix Funds (1994-present), Phoenix Duff & Phelps Institutional
Mutual Funds (1996-present), Phoenix-Aberdeen Series Fund
(1996-present) and Phoenix-Seneca Funds (2000-present). Second
Vice President and Treasurer, Fund Accounting, Phoenix Home Life
Mutual Insurance Company (1994-1995). Various positions with
Phoenix Home Life Insurance Company (1987-1994).
G. Jeffrey Bohne (52) Secretary Vice President and General Manager, Phoenix Home Life Mutual
101 Munson Street Insurance Co. (1993-present). Senior Vice President, Mutual Fund
Greenfield, MA 01301 Customer Service (1999-present), Vice President, Mutual Fund
Customer Service (1996-1999), Vice President, Transfer
Agency Operations (1993-1996), Phoenix Equity Planning
Corporation. Secretary/Clerk, Phoenix Funds (1993-present),
Phoenix Duff & Phelps Institutional Mutual Funds
(1996-present), Phoenix-Aberdeen Series Fund (1996-present) and
Phoenix-Seneca Funds (2000-present).
</TABLE>
-------------------------
*Indicates that the Trustee is an "interested person" of the Trust within the
meaning of the definition set forth in Section 2(a)(19) of the Investment
Company Act of 1940.
For services rendered to the Fund for the fiscal year ended June 30, 2000,
the Trustees received aggregate remuneration of $________. For service 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 $40,000 and $2,500 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 $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 $1,000 per joint Nominating Committee meeting
attended. Each Trustee who serves
22
<PAGE>
on the Executive Committee and who is not an interested person of the Fund
receives a retainer at the annual rate of $2,000 and $2,000 per joint Executive
Committee meeting attended. The function of the Executive Committee is to serve
as a contract review, compliance review and performance review delegate of the
full Board of Trustees. Trustees costs are allocated equally to each of the
Series and Funds within the complex. The foregoing fees do not include the
reimbursement of expenses incurred in connection with meetings attended.
Officers and employees of the Adviser who are "interested persons" are
compensated for their services by the Adviser and receive no compensation from
the Fund.
For the Fund's last fiscal year, 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 (37 FUNDS)
NAME FROM FUND OF FUND EXPENSES UPON RETIREMENT PAID TO TRUSTEES
--------------- ------------ ------------------- --------------- ----------------
<S> <C> <C> <C> <C>
Robert Chesek $ $
E. Virgil Conway+ $ $
Harry Dalzell-Payne+ $ $
Francis E. Jeffries $ * $
Leroy Keith, Jr. $ None None $
Philip R. McLoughlin+ $0 for any for any $
Everett L. Morris+ $ * Trustee Trustee $
James M. Oates+ $ $
Herbert Roth, Jr.+ $ $
Richard E. Segerson $ * $
Lowell P. Weicker, Jr. $ $
</TABLE>
*This compensation (and the earnings thereon) will be deferred pursuant to the
Directors' Deferred Compensation Plan. At September 30, 2000, the total
amount of deferred compensation (including interest and other accumulation
earned on the original amounts deferred) accrued for Messrs. Jeffries,
Morris, Roth and Segerson was $________, $________, $________ and $________,
respectively. At present, by agreement among the Fund, the Distributor and
the electing trustee, trustee fees that are deferred are paid by the Fund to
the Distributor. The liability for the deferred compensation obligation
appears only as a liability of the Distributor.
+Messrs. Conway, Dalzell-Payne, McLoughlin, Morris, Oates and Roth are members
of the Executive Committee.
On October __, 2000, the Trustees and officers of the Fund beneficially owned
less than 1% of the outstanding shares of the Fund.
PRINCIPAL SHAREHOLDERS
The following table sets forth information as of October __, 2000 with
respect to each person who owns of record or is known by the Fund to own of
record or beneficially own 5% or more of any class of the Fund's equity
securities.
<TABLE>
<CAPTION>
NAME OF SHAREHOLDER CLASS NUMBER OF SHARES PERCENT OF CLASS
------------------- ----- ---------------- ----------------
<S> <C> <C>
MLPF&S for the sole benefit Class %
of its customers
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
Phoenix Equity Planning Corp. Class %
c/o Gene Charon, Controller
100 Bright Meadow Blvd.
Enfield, CT 06082-1957
State Street Bank & Trust Co. Class %
Cust For Bruce Geller
5 Plymouth Rd.
East Rockaway, NY 11518-1313
</TABLE>
23
<PAGE>
<TABLE>
<CAPTION>
NAME OF SHAREHOLDER CLASS NUMBER OF SHARES PERCENT OF CLASS
------------------- ----- ---------------- ----------------
<S> <C> <C>
State Street Bank & Trust Co. Class %
FBO Carol J. Mantegna
1913 Billy Barton Cir.
Reisterstown, MD 21136-5702
</TABLE>
OTHER INFORMATION
CAPITAL STOCK
The Fund was originally organized on November 4, 1991 as a Massachusetts
business trust under the name of "National Worldwide Opportunities Fund." The
Fund's name was changed on May 25, 1994 to "Phoenix Worldwide Opportunities
Fund" to reflect the purchase of the former adviser by Phoenix Home Life
and the affiliation with the other Phoenix Funds. Effective December 16, 1998,
the Fund's name was changed to Phoenix-Aberdeen Worldwide Opportunities Fund.
The Fund was reorganized as a Delaware business trust in October 2000.
The capitalization of the Trust consists solely of an unlimited number of
shares of beneficial interest. The Trust currently offers shares in one Fund
which has different classes. Holders of shares of the Fund have equal rights
with regard to voting, redemptions, dividends, distributions, and liquidations
with respect to the Fund. Shareholders vote on the election of Trustees. On
matters affecting an individual class (such as approval of matters relating to a
Plan of Distribution for a particular class of shares), a separate vote of that
Class is required. The Trust does not hold regular meetings of shareholders. The
Trustees will call a meeting when at least 10% of the outstanding shares so
request in writing. If the Trustees fail to call a meeting after being so
notified, the Shareholders may call the meeting. The Trustees will assist the
Shareholders by identifying other shareholders or mailing communications, as
required under Section 16(c) of the 1940 Act.
Shares are fully paid, nonassessable, redeemable and fully transferable when
they are issued. Shares do not have cumulative voting rights, preemptive rights
or subscription rights. The assets received by the Trust for the issue or sale
of shares of the Fund, and any class thereof and all income, earnings, profits
and proceeds thereof, are allocated to the Fund, and class, respectively,
subject only to the rights of creditors, and constitute the underlying assets of
the Fund or class. The underlying assets of the Fund are required to be
segregated on the books of account, and are to be charged with the expenses in
respect to the Fund and with a share of the general expenses of the Trust. Any
general expenses of the Trust not readily identifiable as belonging to a
particular class will be allocated by or under the direction of the Trustees as
they determine fair and equitable.
Unlike the stockholders of a corporation, there is a possibility that the
shareholders of a business trust such as the Trust may be personally liable for
debts or claims against the Trust. The Declaration of Trust provides that
shareholders shall not be subject to any personal liability for the acts or
obligations of the Trust. The Declaration of Trust provides for indemnification
out of the Trust property for all losses and expenses of any shareholder held
personally liable for the obligations of the Trust. Thus, the risk of a
shareholder incurring financial loss on account of shareholder liability, which
is considered remote, is limited to circumstances in which the Trust itself
would be unable to meet its obligations.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 160 Federal Street, Boston, MA 02110, serves as
independent accountants for the Fund (the "Accountants"). The Accountants audit
the Fund's annual financial statements and express an opinion thereon.
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, 100 Bright Meadow Boulevard, P.O. Box 2200, Enfield, CT
06083-2200, acts as Transfer Agent for the Fund (the "Transfer Agent"). As
compensation, Equity Planning receives a fee equivalent to $17.95 for each
designated shareholder account plus out-of-pocket expenses. Transfer Agent fees
are also utilized to offset costs and fees paid to subtransfer agents employed
by Equity Planning. State Street Bank and Trust Company serves as a subtransfer
agent pursuant to a Subtransfer Agency Agreement.
REPORT TO SHAREHOLDERS
The fiscal year of the Fund ends on June 30. The Fund will send financial
statements to its shareholders at least semi-annually. An annual report,
containing financial statements audited by the Fund's independent accountants,
will be sent to shareholders each year.
FINANCIAL STATEMENTS
The Financial Statements for the Fund's fiscal year ended June 30, 2000,
appearing in the Fund's 2000 Annual Report to Shareholders, are incorporated
herein by reference.
24
<PAGE>
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
PART C--OTHER INFORMATION
ITEM 23. EXHIBITS
a.1 Declaration of Trust of the Registrant, filed as Exhibit 1.1
via EDGAR with Post-Effective Amendment No. 63 on
October 24, 1997 and herein incorporated by reference.
a.2 Amendment to Declaration of Trust designating Classes of
Shares, filed as Exhibit 1.2 via EDGAR with Post-Effective
Amendment No. 61 on October 30, 1995 and incorporated herein
by reference.
a.3 Amendment to Declaration of Trust establishing Class C
Shares, filed via EDGAR with Post-Effective Amendment No. 66
on December 15, 1998 and incorporated herein by reference.
a.4 Amendment to Declaration of Trust changing name of Trust to
"Phoenix-Aberdeen Worldwide Opportunities Fund," filed via
EDGAR with Post-Effective Amendment No. 66 on December 15,
1998 and incorporated herein by reference.
b. By-laws of the Registrant, previously filed and filed as
Exhibit 2.1 via EDGAR with Post-Effective Amendment No. 63
on October 24, 1997 and herein incorporated by reference.
c. Reference is made to Article V of Registrant's Declaration of
Trust, as amended, referred to in Exhibit a.1.
d.1 Management Agreement between Registrant and National
Securities & Research Corporation, dated May 14, 1993 and
assigned to Phoenix Investment Counsel, Inc. effective
June 1, 1998, filed as Exhibit 5.1 via EDGAR with
Post-Effective Amendment No. 63 on October 24, 1997 and
herein incorporated by reference.
d.2 Amendment to Management Agreement between Registrant and
National Securities & Research Corporation, dated January 1,
1994 and assigned to Phoenix Investment Counsel, Inc.
effective June 1, 1998, filed as Exhibit 5.2 via EDGAR with
Post-Effective Amendment No. 61 on October 30, 1995 and
incorporated herein by reference.
d.3 Subadvisory Agreement between Phoenix Investment Counsel, Inc.
and Aberdeen Fund Managers, Inc. dated October 27, 1998, filed
via EDGAR with Post-Effective Amendment No. 66 on December 15,
1998 and incorporated herein by reference.
e.1 Underwriting Agreement between Registrant and Phoenix Equity
Planning Corporation ("Equity Planning"), dated November 19,
1997, filed as Exhibit 6.1 via EDGAR with Post-Effective
Amendment No. 64 on October 6, 1998 and herein incorporated by
reference.
e.2 Form of Sales Agreement between Phoenix Equity Planning
Corporation and dealers, filed as Exhibit 6.2 via EDGAR with
Post-Effective Amendment No. 64 on October 6, 1998 and herein
incorporated by reference.
e.3 Form of Supplement to Phoenix Family of Funds Sales Agreement,
filed as Exhibit 6.3 via EDGAR with Post-Effective Amendment
No. 64 on October 6, 1998 and herein incorporated by
reference.
C-1
<PAGE>
e.4 Form of Financial Institution Sales Contract for the Phoenix
Family of Funds filed as Exhibit 6.4 via EDGAR with
Post-Effective Amendment No. 64 on October 6, 1998 and herein
incorporated by reference.
f. None.
g. Custody Agreement between Registrant and Brown Brothers
Harriman & Co., dated August 11, 1994, filed as Exhibit 8 via
EDGAR with Post-Effective Amendment No. 63 on October 24, 1997
and incorporated herein by reference.
h.1 Transfer Agency and Service Agreement between Registrant and
Phoenix Equity Planning Corporation, dated June 1, 1994, filed
as Exhibit 9.1 via EDGAR with Post-Effective Amendment No. 63
on October 24, 1997 and incorporated herein by reference.
h.2 Sub-transfer Agent Agreement between Equity Planning and State
Street Bank and Trust Company, dated June 1, 1994 filed as
Exhibit 9.2 via EDGAR with Post-Effective Amendment No. 64 on
October 6, 1998 and herein incorporated by reference.
h.3 Amended and Restated Financial Agent Agreement between
Registrant and Phoenix Equity Planning Corporation, dated
November 19, 1997, filed as Exhibit 9.3 via EDGAR with
Post-Effective Amendment No. 64 on October 6, 1998 and herein
incorporated by reference.
h.4 First Amendment to Amended and Restated Financial Agent
Agreement between Registrant and Phoenix Equity Planning
Corporation, dated March 23, 1998, filed as Exhibit 9.4 via
EDGAR with Post-Effective Amendment No. 64 on October 6, 1998
and herein incorporated by reference.
h.5 Second Amendment to Amended and Restated Financial Agent
Agreement between Registrant and Phoenix Equity Planning
Corporation, dated July 31, 1998, filed as Exhibit 9.5 via
EDGAR with Post-Effective Amendment No. 64 on October 6, 1998
and herein incorporated by reference.
i. Opinion as to legality of the shares filed via EDGAR with
Post Effective Amendment No. 61 on October 30, 1995,
incorporated herein by reference.
j. Consent of Independent Accountants filed via EDGAR with
Post-Effective Amendment No. 67 on October 26, 1999 and
incorporated herein by reference.
k. Not applicable.
l. None.
m.1 Amended and Restated Distribution Plan Pursuant to Rule 12b-1
for Class A Shares filed as Exhibit 15.1 via EDGAR with
Post-Effective Amendment No. 63 on October 24, 1997 and
incorporated herein by reference.
m.2* Distribution Plan Pursuant to Rule 12b-1 for Class B Shares
filed via EDGAR herewith.
m.3* Distribution Plan Pursuant to Rule 12b-1 for Class C Shares
filed via EDGAR herewith.
n.27 Financial Data Schedule.
o.1* Amended and Restated Plan Pursuant to Rule 18f-3 effective
July 1, 1999, filed via EDGAR herewith.
C-2
<PAGE>
o.2* First Amendment to the Amended and Restated Plan Pursuant to
Rule 18f-3, dated February 24, 2000, filed via EDGAR herewith.
p.1* Codes of Ethics of the Fund, the Adviser and the Distributor
filed via EDGAR herewith.
q.1 Powers of attorney for Messrs. Pedersen and Roth filed via
EDGAR as Exhibit p.1 with Post-Effective Amendment No. 67 on
October 25, 1999 and herein incorporated by reference.
q.2* Powers of attorney for the other trustees filed via EDGAR
herewith.
----------
*Filed herewith
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
None.
ITEM 25. 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 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
See "Management of the Fund" in the Prospectus and "Services of the
Adviser" and "Management of the Fund" in the Statement of Additional Information
which is included in this Post-Effective Amendment. For information as to the
business, profession, vocation or employment of a substantial nature of
directors and officers of Phoenix Investment Counsel, Inc., the Adviser,
reference is made to the Advisers' current Form ADV (SEC File No. 801-5995)
filed under the Investment Advisers Act of 1940 and incorporated herein by
reference.
ITEM 27. PRINCIPAL UNDERWRITER
(a) Equity Planning also serves as the principal underwriter for the
following other registrants:
Phoenix-Aberdeen Series Fund, Phoenix Duff & Phelps Institutional Mutual
Funds, Phoenix-Engemann Funds, Phoenix Equity Series Fund, Phoenix-Euclid Funds,
Phoenix-Goodwin California Tax Exempt Bonds, Phoenix-Goodwin Multi-Sector Fixed
Income Fund, Inc., Phoenix-Goodwin Multi-Sector Short Term Bond Fund, Phoenix
Investment Trust 97, Phoenix Multi-Portfolio Fund, Phoenix-Oakhurst Income &
Growth Fund, Phoenix-Seneca Funds, Phoenix Series Fund, Phoenix-Oakhurst
Strategic Allocation Fund, Inc., Phoenix Strategic Equity Series Fund,
Phoenix-Zweig Trust, Phoenix Home Life Variable Universal Life Account, Phoenix
Home Life Variable Accumulation Account, PHL Variable Accumulation Account,
Phoenix Life and Annuity Variable Universal Life Account, and PHL Variable
Separate Account MVA1.
(b) Directors and executive officers of Phoenix Equity Planning Corporation
are as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
NAME AND POSITIONS AND OFFICES POSITIONS AND OFFICES
PRINCIPAL ADDRESS WITH DISTRIBUTOR WITH REGISTRANT
----------------- --------------------- ---------------------
Michael E. Haylon Director Executive Vice President
56 Prospect Street
P.O. Box 150480
Hartford, CT 06115-0480
Philip R. McLoughlin Director and Chairman Trustee and President
56 Prospect Street
P.O. Box 150480
Hartford, CT 06115-0480
William R. Moyer Director, Executive Vice Vice President
100 Bright Meadow Blvd. President, Chief Financial
P.O. Box 2200 Officer and Treasurer
Enfield, CT 06083-2200
</TABLE>
C-3
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
NAME AND POSITIONS AND OFFICES POSITIONS AND OFFICES
PRINCIPAL ADDRESS WITH DISTRIBUTOR WITH REGISTRANT
----------------- --------------------- ---------------------
John F. Sharry President, Retail Executive Vice President
56 Prospect Street Division
P.O. Box 150480
Hartford, CT 06115-0480
Barry Mandinach Executive Vice President None
900 Third Avenue Chief Marketing Officer,
New York, NY 10022 Retail Division
Robert Tousingnant Executive Vice President None
56 Prospect Street Chief Sales Officer
P.O. Box 150480
Hartford, CT 06115-0480
G. Jeffrey Bohne Vice President, Mutual Secretary
101 Munson Street Fund Customer Service
Greenfield, MA 01301
Robert S. Dreissen Vice President, Compliance Vice President and
56 Prospect Street Assistant Secretary
P.O. Box 150480
Hartford, CT 06115-0480
Jacqueline Porter Assistant Vice President Assistant Treasurer
56 Prospect Street
P.O. Box 150480
Hartford, CT 06115
</TABLE>
(c) To the best of the Registrant's knowledge, no commissions or other
compensation was received by any principal underwriter who is not an affiliated
person of the Registrant or an affiliated person of such affiliated person,
directly or indirectly, from the Registrant during the Registrant's last fiscal
year.
ITEM 28. 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, Phoenix Investment Counsel, Inc.; 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 Phoenix Investment Counsel, Inc. is 56 Prospect Street, Hartford,
Connecticut 06115; 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 29. MANAGEMENT SERVICES
Not applicable.
ITEM 30. UNDERTAKINGS
Not applicable.
C-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act and the Investment
Company Act, the Registrant has duly caused this amendment to the registration
statement to be signed on its behalf by the undersigned, duly authorized, in the
City of Hartford, and State of Connecticut on the 7th day of August, 2000.
<TABLE>
<CAPTION>
PHOENIX-ABERDEEN WORLDWIDE OPPORTUNITIES FUND
<S> <C>
ATTEST: /s/ Pamela S. Sinofsky BY: /s/ Philip R. McLoughlin
-------------------------------- ------------------------------------
Pamela S. Sinofsky Philip R. McLoughlin
Assistant Secretary President
</TABLE>
Pursuant to the requirements of the Securities Act, this amendment to the
registration statement has been signed below by the following persons in the
capacities indicated, on this 7th day of August, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
--------------------------------------------
Robert Chesek* Trustee
--------------------------------------------
E. Virgil Conway* Trustee
/s/ Nancy G. Curtiss Treasurer (principal financial
-------------------------------------------- and accounting officer
Nancy G. Curtiss
--------------------------------------------
Harry Dalzell-Payne* Trustee
--------------------------------------------
Francis E. Jeffries* Trustee
--------------------------------------------
Leroy Keith, Jr.* Trustee
/s/ Philip R. McLoughlin
--------------------------------------------
Philip R. McLoughlin Trustee and President
--------------------------------------------
Everett L. Morris* Trustee
--------------------------------------------
James M. Oates* Trustee
--------------------------------------------
Calvin J. Pedersen* Trustee
--------------------------------------------
Herbert Roth, Jr.* Trustee
--------------------------------------------
Richard E. Segerson* Trustee
--------------------------------------------
Lowell P. Weicker, Jr.* Trustee
</TABLE>
*By /s/ Philip R. McLoughlin
------------------------------------------------
* Philip R. McLoughlin pursuant to powers of attorney.
S-1 (c)
