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Exhibit (d)(2)(xi)
THE TARGET PORTFOLIO TRUST
SMALL CAPITALIZATION VALUE PORTFOLIO
(Credit Suisse Asset Management, LLC)
Subadvisory Agreement
Agreement made as of this 27th day of February 2001, between Prudential
Investments Fund Management LLC, a New York limited liability company ("PIFM" or
the "Manager"), and Credit Suisse Asset Management, LLC, a Delaware limited
liability company (the "Subadviser").
WHEREAS, the Manager has entered into a Management Agreement, dated
November 9, 1992 (the "Management Agreement"), with The Target Portfolio Trust
(the "Trust"), a Delaware business trust and an open-end, management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"), on behalf of its series the Small Capitalization Value Portfolio
(the "Portfolio"), pursuant to which PIFM will act as Manager of the Portfolio;
and
WHEREAS, PIFM desires to retain the Subadviser to provide investment
advisory services to the Portfolio and to manage such portion of the Portfolio
as the Manager shall from time to time direct, and the Subadviser is willing to
render such investment advisory services.
NOW, THEREFORE, the Parties agree as follows:
1. (a) Subject to the supervision of the Manager and the Board of
Trustees of the Trust, the Subadviser shall manage such portion of the
investment operations of the Portfolio as the Manager shall direct and
shall manage the composition of the Portfolio's portfolio, including
the purchase, retention and disposition thereof, in accordance with the
Portfolio's investment objectives, policies and restrictions as stated
in the Prospectus and Statement of Additional Information (such
Prospectus and Statement of Additional Information as currently in
effect and as amended or supplemented from time to time, being herein
called the Prospectus), and subject to the following understandings:
(i) The Subadviser shall provide supervision of such portion
of the Portfolio's investments as the Manager shall direct and shall
determine from time to time what investments and securities will be
purchased, retained, sold or loaned by the Portfolio, and what portion
of the assets will be invested or held uninvested as cash.
(ii) In the performance of its duties and obligations under
this Agreement, the Subadviser shall act in conformity with the
Agreement and Declaration of Trust, By-Laws and Prospectus of the
Portfolio and with the written instructions and directions of the
Manager and of the Board of Trustees of
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the Trust, and will conform to and comply with the requirements of the
1940 Act, the Internal Revenue Code of 1986, as amended, and all other
applicable federal and state laws and regulations. In connection with
the performance of its duties and obligations under this Agreement, the
Subadviser shall, among other things, prepare and file such reports as
are, or may in the future be, required by the Securities and Exchange
Commission.
(iii) The Subadviser shall determine the securities and
futures contracts to be purchased or sold by such portion of the
Portfolio, and will place orders with or through such persons, brokers,
dealers or futures commission merchants (including but not limited to
Prudential Securities Incorporated or any broker or dealer affiliated
with the Subadviser) to carry out the policy with respect to brokerage
as set forth in the Portfolio's Prospectus or as the Board of Trustees
may direct from time to time. In providing the Portfolio with
investment supervision, it is recognized that the Subadviser will give
primary consideration to securing the most favorable price and
efficient execution. Within the framework of this policy, the
Subadviser may consider the financial responsibility, research and
investment information and other services provided by brokers, dealers
or futures commission merchants who may effect or be a party to any
such transaction or other transactions to which the Subadviser's other
clients may be a party. It is understood that Prudential Securities
Incorporated or any broker or dealer affiliated with the Subadviser may
be used as principal broker for securities transactions, but that no
formula has been adopted for allocation of the Portfolio's investment
transaction business. It is also understood that it is desirable for
the Portfolio that the Subadviser have access to supplemental
investment and market research and security and economic analysis
provided by brokers or futures commission merchants who may execute
brokerage transactions at a higher cost to the Portfolio than may
result when allocating brokerage to other brokers on the basis of
seeking the most favorable price and efficient execution. Therefore,
the Subadviser is authorized to place orders for the purchase and sale
of securities and futures contracts for the Portfolio with such brokers
or futures commission merchants, subject to review by the Trust's Board
of Trustees from time to time with respect to the extent and
continuation of this practice. It is understood that the services
provided by such brokers or futures commission merchants may be useful
to the Subadviser in connection with the Subadviser's services to other
clients.
On occasions when the Subadviser deems the purchase or sale of
a security or futures contract to be in the best interest of the
Portfolio as well as other clients of the Subadviser, the Subadviser,
to the extent permitted by applicable laws and regulations, may, but
shall be under no obligation to, aggregate the securities or futures
contracts to be sold or purchased in order to obtain the most favorable
price or lower brokerage commissions and efficient execution. In such
event, allocation of the securities or futures contracts so purchased
or sold, as well as the expenses incurred in the transaction, will be
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made by the Subadviser in the manner the Subadviser considers to be the
most equitable and consistent with its fiduciary obligations to the
Portfolio and to such other clients.
(iv) The Subadviser shall maintain all books and records with
respect to the Portfolio's portfolio transactions required by
subparagraphs (b)(5), (6), (7), (9), (10) and (11) and paragraph (f) of
Rule 31a-1 under the 1940 Act, and shall render to the Trust's Board of
Trustees such periodic and special reports as the Trustees may
reasonably request. The Subadviser shall make reasonably available its
employees and officers for consultation with any of the Trustees or
officers or employees of the Trust with respect to any matter discussed
herein, including, without limitation, the valuation of the Portfolio's
securities.
During the term of the Agreement and for one year thereafter,
the Manager and the Subadviser each agrees to keep confidential any and
all written or oral information that it may be provided regarding the
other, including its structure, management, work flows, organization,
financial controls and condition, personnel and other information that
is not publicly available and that is valuable and confidential to such
party (collectively, "Confidential Information"). Each party also
agrees to have in effect, and enforce, rules and policies designed to
protect against unauthorized access to or use of the Confidential
Information. Each party agrees to disclose the Confidential Information
to its employees and agents only to the extent necessary to carry out
the purpose for which the Confidential Information is disclosed.
(v) The Subadviser shall provide the Portfolio's Custodian on
each business day with information relating to all transactions
concerning the portion of the Portfolio's assets it manages, and shall
provide the Manager with such information upon request of the Manager.
(vi) The investment management services provided by the
Subadviser hereunder are not to be deemed exclusive, and the Subadviser
shall be free to render similar services to others. Conversely,
Subadviser and Manager understand and agree that if the Manager manages
the Fund in a "manager-of-managers" style, the Manager will, among
other things, (i) continually evaluate the performance of the
Subadviser through quantitative and qualitative analysis and
consultations with such Subadviser (ii) periodically make
recommendations to the Trust's Board as to whether the contract with
one or more Subadviser(s) should be renewed, modified, or terminated
and (iii) periodically report to the Trust's Board regarding the
results of its evaluation and monitoring functions. The Subadviser
recognizes that its services may be terminated or modified pursuant to
this process.
(b) The Subadviser shall authorize and permit any of its directors,
officers and employees who may be elected as Trustees or officers of the Trust
to serve in the
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capacities in which they are elected. Services to be furnished by the Subadviser
under this Agreement may be furnished through the medium of any of such
directors, officers or employees.
(c) The Subadviser shall keep the Portfolio's books and records
required to be maintained by the Subadviser pursuant to paragraph 1(a) hereof
and shall timely furnish to the Manager all information relating to the
Subadviser's services hereunder needed by the Manager to keep the other books
and records of the Portfolio required by Rule 31a-1 under the 1940 Act. The
Subadviser agrees that all records that it maintains for the Portfolio are the
property of the Portfolio, and the Subadviser will surrender promptly to the
Trust any of such records upon the Trust's request, provided, however, that the
Subadviser may retain a copy of such records. The Subadviser further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940 Act any such
records as are required to be maintained by it pursuant to paragraph 1(a)
hereof.
(d) The Subadviser agrees to maintain adequate compliance procedures
reasonably designed to ensure its compliance with the 1940 Act, the Investment
Advisers Act of 1940, as amended, and other applicable state and federal
regulations.
(e) The Subadviser shall furnish to the Manager copies of all records
prepared in connection with (i) the performance of this Agreement and (ii) the
maintenance of compliance procedures pursuant to paragraph 1(d) hereof as the
Manager may reasonably request.
2. The Manager shall continue to have responsibility for all services
to be provided to the Portfolio pursuant to the Management Agreement and, as
more particularly discussed above, shall oversee and review the Subadviser's
performance of its duties under this Agreement.
3. For the services provided and the expenses assumed pursuant to this
Agreement, the Manager shall pay the Subadviser as full compensation therefor, a
fee equal to the percentage of the Portfolio's average daily net assets of the
portion of the Portfolio managed by the Subadviser as described in the attached
Schedule A.
4. The Subadviser shall not be liable for any error of judgment or for
any loss suffered by the Portfolio or the Manager in connection with the matters
to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the Subadviser's part in the
performance of its duties or from its reckless disregard of its obligations and
duties under this Agreement.
5. This Agreement shall continue in effect for a period of more than
two years from the date hereof only so long as such continuance is specifically
approved at least annually in conformity with the requirements of the 1940 Act;
provided, however, that this Agreement may be terminated by the Portfolio at any
time, without the payment of any penalty, by the Board of Trustees of the Trust
or by vote of a majority of the outstanding voting securities (as defined in the
0000 Xxx) of the Portfolio, or by the
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Manager or the Subadviser at any time, without the payment of any penalty, on
not more than 60 days' nor less than 30 days' written notice to the other party.
This Agreement shall terminate automatically in the event of its assignment (as
defined in the 0000 Xxx) or upon the termination of the Management Agreement.
The Subadviser agrees that it will promptly notify the Trust and the Manager of
the occurrence or anticipated occurrence of any event that would result in the
assignment (as defined in the 0000 Xxx) of this Agreement, including, but not
limited to, a change or anticipated change in control (as defined in the 0000
Xxx) of the Subadviser.
Any notice or other communication required to be given pursuant to
Section 5 of this Agreement shall be deemed duly given if delivered or mailed by
registered mail, postage prepaid, (1) to the Manager at Gateway Center Three,
000 Xxxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, XX 00000-0000, Attention: Secretary; (2)
to the Trust at Gateway Center Three, 000 Xxxxxxxx Xxxxxx, Xxxxxx, XX
00000-0000, Attention: Secretary; or (3) to the Subadviser at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: General Counsel.
6. Nothing in this Agreement shall limit or restrict the right of any
of the Subadviser's directors, officers or employees who may also be a Trustee,
officer or employee of the Trust to engage in any other business or to devote
his or her time and attention in part to the management or other aspects of any
business, whether of a similar or a dissimilar nature, nor limit or restrict the
Subadviser's right to engage in any other business or to render services of any
kind to any other corporation, firm, individual or association.
7. During the term of this Agreement, the Manager agrees to furnish the
Subadviser at its principal office all prospectuses, proxy statements, reports
to shareholders, sales literature or other material prepared for distribution to
shareholders of the Portfolio or the public, which refer to the Subadviser in
any way, prior to use thereof and not to use material if the Subadviser
reasonably objects in writing five business days (or such other time as may be
mutually agreed) after receipt thereof. Sales literature may be furnished to the
Subadviser hereunder by first-class or overnight mail, facsimile transmission
equipment or hand delivery.
8. This Agreement may be amended by mutual consent, but the consent of
the Portfolio must be obtained in conformity with the requirements of the 1940
Act.
9. This Agreement shall be governed by the laws of the State of New
York.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
PRUDENTIAL INVESTMENTS FUND MANAGEMENT LLC
BY: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
Executive Vice President
CREDIT SUISSE ASSET MANAGEMENT, LLC
BY: /s/ Xxx Xxxxxx
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Xxx Xxxxxx
Managing Director
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SCHEDULE A
THE TARGET PORTFOLIO TRUST
SMALL CAPITALIZATION VALUE PORTFOLIO
(Credit Suisse Asset Management, LLC)
As compensation for the Subadviser's services, PIFM will pay the Subadviser a
fee equal, on an annualized basis, to 0.40% of the average daily net assets of
the portion of the Portfolio advised by the Subadviser.
Dated as of February 27, 2001
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