ADVANCED SERIES TRUST AST Neuberger Berman Long/Short Portfolio SUBADVISORY AGREEMENT
AST Xxxxxxxxx Xxxxxx Long/Short Portfolio
SUBADVISORY AGREEMENT
Agreement made as of this 30th day of April, 2015 between
Prudential Investments LLC (PI or the Manager), a New York limited liability company and Xxxxxxxxx Xxxxxx Management LLC, a Delaware
limited liability company (Xxxxxxxxx Xxxxxx or the Subadviser),
WHEREAS, the Manager has entered into a Management Agreement (the
Management Agreement) dated May 1, 2003, with Advanced Series Trust (formerly American Skandia Trust), a Massachusetts business
trust (the Trust) and a diversified, open-end management investment company registered under the Investment Company Act of 1940,
as amended (the 1940 Act), pursuant to which PI acts as Manager of the Trust; and
WHEREAS, the Manager, acting pursuant to the Management Agreement,
desires to retain the Subadviser to provide investment advisory services to the Trust and one or more of its series as specified
in Schedule A hereto (individually and collectively, with the Trust, referred to herein as the Trust) and to manage such portion
of the Trust as the Manager shall from time to time direct, and the Subadviser is willing to render such investment advisory services;
and
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 Trust's portfolio as delegated to the Subadviser by the Manager, including the purchase, retention and disposition thereof, in accordance with the Trust's investment objectives, policies and restrictions as stated in its then current 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").
The Manager hereby authorizes and directs the Subadviser, as agent on behalf of the Trust, to enter into: (y) brokerage agreements and other documents to establish, operate and conduct all brokerage, collateral or other trading accounts; (z) agreements and other documentation as may be required for the purchase or sale, assignment, transfer and ownership of any permitted investment, including but not limited to International Swaps and Derivatives Association, Inc. (ISDA) Master Agreements, futures agreements, master securities forward transaction agreements, prime brokerage agreements, limited partnership agreements, repurchase agreements, including and any amendments, protocols (including ISDA protocols), credit support annexes, schedules, master confirmation agreements, confirmations, addenda (including cleared derivatives addenda), supplements, releases, consents, elections, accounting opening and maintenance documents, questionnaires and other documents related to such arrangements. The Subadviser also is hereby authorized to instruct the Trust’s custodian with respect to any collateral management activities in connection with any derivatives transactions. The Manager acknowledges and understands that the Trust and the Manager, as applicable, will be bound by any such trading accounts established, and agreements and other documentation executed, by the Subadviser for such investment purposes and agree to provide the Subadviser with tax information, governing documents, legal opinions and other information concerning the Trust necessary to complete such agreements and other documentation. Notwithstanding anything to the contrary in this Agreement, except as otherwise specified by notice from the Trust to the Subadviser, the Subadviser may place orders for the execution of transactions hereunder with or through any broker-dealer, futures commission merchant, bank, or any other agent or counterparty that the Subadviser may select in its own discretion.
In performing its obligations under this Agreement, the Manager authorizes Subadviser, at its own discretion and without the consent of the Manager, to delegate any non-investment advisory services to any third party service provider. Notwithstanding anything herein to the contrary, the Subadviser's liability to the Manager and the Trust at all times under this Agreement shall not be affected in any way whatsoever by any use of a third party service provider and the Subadviser (and not the Manager) shall be solely responsible for any fees, charges, or expenses owed to any such third party service provider. In addition, notwithstanding any other provision of the Agreement, the Subadviser: (x) may provide information about the Manager and the Trust to any such third party service provider; (y) will act in good faith and with due diligence in the selection, use, and monitoring of any such third party service provider; and (z) shall ensure that any such third party service provider is subject to confidentiality and non-disclosure obligations that are substantially similar to the confidentiality and non-disclosure obligations to which the Subadviser is subject with respect to the Trust.
The Subadviser’s management of such portion of the Trust’s
portfolio as delegated to the Subadviser by the Manager shall be subject to the following additional understandings:
(i) The Subadviser shall provide supervision of such portion of the Trust'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 Trust, and what
portion of the assets will be invested or held uninvested as cash. The subadviser may use persons employed by an “affiliated
person” (as defined in the 0000 Xxx) of the Subadviser, each of whom shall be treated as an “associated person”
of the Subadviser (as defined in the Investment Advisers Act of 1940 (the Advisers Act)) to assist in the performance of any or
all of the services or functions provided by the Subadviser under this Agreement to the extend not prohibited by, or inconsistent
with, applicable law, including the requirements of the 1940 Act, the rules thereunder and any relevant positions of Securities
and Exchange Commission (the Commission) and its staff. Notwithstanding anything herein to the contrary, the Subadviser’s
liability to the Manager and the Trust at all times under this Agreement shall not be affected in any way whatsoever by any use
of such associated persons and the Subadviser (and not the Manager) shall be solely responsible for any fees, charges or expenses
owed to such affiliated person and such associated persons. In addition, notwithstanding any other provision of the Agreement,
the Subadviser: (x) may provide information about the Manager and the Trust to any such affiliated person and any such associated
persons providing services hereunder; (y) will act in good faith and with due diligence in the selection, use and monitoring of
any such affiliated person and any such associated person providing services hereunder; and (z) shall ensure that any affiliated
person and any such associated person providing services hereunder is subject to confidentiality and non-disclosure obligations
that are substantially similar to the confidentiality and non-disclosure obligations to which the Subadviser is subject with respect
to the Trust.
(ii) In the performance of its duties and obligations under this
Agreement, the Subadviser shall act in conformity with the copies of the Amended and Restated Declaration of Trust of the Trust,
the By-laws of the Trust, the Prospectus of the Trust, and the Trust's valuation procedures as provided to it by the Manager (the
Trust Documents) and with the instructions and directions of the Manager and of the Board of Trustees of the Trust, co-operate
with the Manager's (or its designees') personnel responsible for monitoring the Trust's compliance and will conform to, and comply
with, the requirements of the 1940 Act, the Commodity Exchange Act of 1936, as amended (the CEA), the Internal Revenue Code of
1986, as amended, and all other applicable federal and state laws and regulations. In connection therewith, the Subadviser shall,
among other things, prepare and file such reports as are, or may in the future be, required by the Commission. The Manager shall
provide Subadviser timely with copies of any updated Trust Documents.
(iii) The Subadviser shall determine
the securities, futures contracts and other instruments to be purchased or sold by such portion of the Trust's portfolio, as applicable,
and may place orders with or through such persons, brokers, dealers or futures commission merchants, including any person or entity
affiliated with the Subadviser (collectively, Brokers), to carry out the policy with respect to brokerage as set forth in the Trust's
Prospectus or as the Board of Trustees may direct in writing from time to time. In providing the Trust 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 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. The Manager (or Subadviser) to the Trust each shall have discretion to effect investment
transactions for the Trust through Brokers (including, to the extent legally permissible, Brokers affiliated with the Subadviser)
qualified to obtain best execution of such transactions who provide brokerage and/or research services, as such services are defined
in Section 28(e) of the Securities Exchange Act of 1934, as amended (the 1934 Act), and to cause the Trust to pay any such Brokers
an amount of commission for effecting a portfolio transaction in excess of the amount of commission another Broker would have charged
for effecting that transaction, if the brokerage or research services provided by such Broker, viewed in light of either that particular
investment transaction or the overall responsibilities of the Manager (or the Subadviser) with respect to the Trust and other accounts
as to which they or it may exercise investment discretion (as such term is defined in Section 3(a)(35) of the 1934 Act), are reasonable
in relation to the amount of commission. On occasions when the Subadviser deems the purchase or sale of a security, futures contract
or other instrument to be in the best interest of the
Trust 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, futures contracts or other instruments to be sold or purchased.
In such event, allocation of the securities, futures contracts or other instruments so purchased or sold, as well as the expenses
incurred in the transaction, will be made by the Subadviser in the manner the Subadviser considers to be the most equitable and
consistent with its fiduciary obligations to the Trust and to such other clients.
(iv) The Subadviser shall maintain all books and records with respect to the Trust's portfolio transactions effected by it as required by Rule 31a-l 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 Trust's securities.
(v) The Subadviser or an affiliate shall provide the Trust's Custodian
on each business day with information relating to all transactions concerning the portion of the Trust'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, the
Subadviser and Manager understand and agree that if the Manager manage the Trust 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 the Subadviser, (ii) periodically make recommendations to the Trust's Board as to whether the contract
with one or more subadvisers 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 Sub adviser recognizes that its services may be terminated or modified
pursuant to this process.
(vii) The Subadviser acknowledges that the Manager and the Trust
intend to rely on Rule 17a-l0, Rule l0f-3, Rule 12d3-1 and Rule 17e-l under the 1940 Act, and the Subadviser hereby agrees that
it shall not consult with any other subadviser to the Trust with respect to transactions in securities for the Trust's portfolio
or any other transactions of Trust assets.
(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 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 Trust'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 Trust required by Rule
31a-I under the 1940 Act or any successor regulation. The Subadviser agrees that all records which it maintains for the Trust are
the property of the Trust, and the Subadviser will tender 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 of the Commission under the 1940 Act or any successor regulation any such records as are required to be maintained
by it pursuant to paragraph 1(a) hereof.
(d) To the extent required under applicable law, the Subadviser is a commodity trading advisor duly registered with the Commodity Futures Trading Commission (the CFTC) and is a member in good standing of the National Futures Association (the NFA) or meets an applicable exemption from such registration. To the extent applicable, the Subadviser shall maintain such registration and membership, or any applicable exemption from registration, in good standing during the term of this Agreement. Further, the Subadviser agrees to notify the Manager promptly upon (i) a statutory disqualification of the Subadviser under Sections 8a(2) or 8a(3) of the CEA, (ii) a suspension, revocation or limitation of the Subadviser’s commodity trading advisor registration or NFA membership, or (iii) the institution of an action or proceeding that could lead to a statutory disqualification under the CEA or an investigation by any governmental agency or self-regulatory organization of which the Subadviser is subject or has been advised it is a target.
(e) In connection with its duties under this Agreement, the Subadviser agrees to maintain adequate compliance procedures to ensure its compliance with the 1940 Act, the CEA, the Investment Advisers Act of 1940, as amended, and other applicable state and federal regulations, and applicable rules of any self-regulatory organization.
(f) 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.
(g) The Subadviser shall be responsible for the voting of all shareholder proxies with respect to the investments and securities held in the Trust's portfolio, subject to such reasonable reporting and other requirements as shall be established by the Manager.
(h) Upon reasonable request from the Manager, the Subadviser (through a qualified person) will assist the valuation committee of the Trust or the Manager in valuing investments of the Trust as may be required from time to time, including making available information of which the Subadviser has knowledge related to the investments being valued.
2. The Manager shall continue to have responsibility for all services
to be provided to the Trust 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. The Manager shall provide (or cause the Trust's custodian to provide)
timely information to the Subadviser regarding such matters as the composition of assets in the portion of the Trust managed by
the Subadviser, cash requirements and cash available for investment in such portion of the Trust, and all other information as
may be reasonably necessary for the Subadviser to perform its duties hereunder (including any excerpts of minutes of meetings of
the Board of Trustees of the Trust that affect the duties of the Subadviser).
3. For the services provided pursuant to this Agreement, the Manager shall pay the Subadviser as full compensation therefor, a fee equal to the percentage of the Trust's average daily net assets of the portion of the Trust managed by the Subadviser as described in the attached Schedule A. Liability for payment of compensation by the Manager to the Subadviser under this Agreement is contingent upon the Manager' receipt of payment from the Trust for management services described under the Management Agreement between the Fund and the Manager. Expense caps or fee waivers for the Trust that may be agreed to by the Manager, but not agreed to by the Subadviser, shall not cause a reduction in the amount of the payment to the Subadviser by the Manager.
4. The Subadviser shall not be liable for any error of judgment
or for any loss suffered by the Trust 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, provided, however, that nothing in this Agreement
shall be deemed to waive any rights the Manager or the Trust may have against the Subadviser under federal or state securities
laws. The Manager shall indemnify the Subadviser, its affiliated persons, its officers, directors and employees, for any liability
and expenses, including attorneys' fees, which may be sustained as a result of the Manager' willful misfeasance, bad faith, gross
negligence, reckless disregard of its duties hereunder or violation of applicable law, including, without limitation, the 1940
Act and federal and state securities laws. The Subadviser shall indemnify the Manager, their affiliated persons, their officers,
directors and employees, for any liability and expenses, including attorneys' fees, which may be sustained as a result of the Subadviser's
willful misfeasance, bad faith, gross negligence, or reckless disregard of its duties hereunder or violation of applicable law,
including, without limitation, the 1940 Act and federal and state securities laws.
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 Trust 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 Fund, or by the 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 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 of control (as defined in the 0000 Xxx) of the Subadviser.
To the extent that the Manager delegates to the Subadviser management of all or a portion of a portfolio of the Trust previously managed by a different subadviser or the Manager, the Subadviser agrees that its duties and obligations under this Agreement with respect to that delegated portfolio or portion thereof shall commence as of the date the Manager begins the transition process to allocate management responsibility to the Subadviser unless the Subadviser and Manager have agreed, in writing, that the duties shall commence on a later date.
Any notice or other communication required to be given pursuant
to 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 (for PI); (2) to the Trust at
Gateway Center Three, 000 Xxxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, XX 00000-0000, Attention: Secretary; or (3) to the Subadviser at
Xxxxxxxxx Xxxxxx Management LLC, 000 Xxxxx 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, and reports to shareholders 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. During the term of this Agreement, the Manager also agrees to
furnish the Subadviser, upon request, representative samples of marketing and sales literature or other material prepared for distribution
to shareholders of the Trust or the public, which make reference to the Subadviser. The Manager further agrees to prospectively
make reasonable changes to such materials upon the Subadviser's written request, and to implement those changes in the next regularly
scheduled production of those materials. All such prospectuses, proxy statements, replies to shareholders, marketing and sales
literature or other material prepared for distribution to shareholders of the Trust or the public which make reference to the Subadviser
may be furnished to the Subadviser hereunder by electronic mail, 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 Trust 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.
10. Any question of interpretation of any term or provision of this Agreement having a counterpart or otherwise derived from a term or provision of the 1940 Act, shall be resolved by reference to such term or provision of the 1940 Act and to interpretations thereof, if any, by the United States courts or, in the absence of any controlling decision of any such court, by rules, regulations or orders of the Commission issued pursuant to the 1940 Act. In addition, where the effect of a requirement of the 1940 Act, reflected in any provision of this Agreement, is related by rules, regulation or order of the Commission, such provision shall be deemed to incorporate the effect of such rule, regulation or order.
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 LLC
By: /s/ Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: V.P. Investment Management
Xxxxxxxxx Xxxxxx Management LLC
By: /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx
Title: President
SCHEDULE A
As compensation for services provided by Xxxxxxxxx Xxxxxx Management LLC (Xxxxxxxxx Xxxxxx), Prudential Investments LLC will pay Xxxxxxxxx Xxxxxx an advisory fee on the net assets managed by Xxxxxxxxx Xxxxxx that is equal, on an annualized basis, to the following:
|
|
Subadvisory Fee Rate |
| AST Xxxxxxxxx Xxxxxx Long/Short Portfolio |
0.70% of average daily net assets to $100 million; 0.60% of average daily net assets over $100 million
|
* Xxxxxxxxx Xxxxxx has agreed to a fee waiver arrangement that applies to the AST Xxxxxxxxx Xxxxxx Long/Short Portfolio (Portfolio). If applicable, under this arrangement, Xxxxxxxxx Xxxxxx will waive its subadvisory fee for the Portfolio in an amount equal to the acquired fund subadvisory fee paid to Xxxxxxxxx Xxxxxx for any portfolio affiliated with the Manager. In addition, Xxxxxxxxx Xxxxxx will waive its subadvisory fee for the Portfolio in an amount equal to the management or subadvisory fee it receives for acquired funds that are not affiliated with the Manager. Notwithstanding the foregoing, the subadvisory fee waivers will not exceed 100% of the subadvisory fee.
Dated as of: April 30, 2015
