EXHIBIT 99.(d)9
STRATEGIC PARTNERS SERIES
STRATEGIC PARTNERS FOCUSED VALUE FUND
(Xxxxx Selected Advisers, LP)
Subadvisory Agreement
---------------------
Agreement made as of this 13th day of February 2001, between Prudential
Investments Fund Management LLC, a New York limited liability company (PIFM or
the Manager), and Xxxxx Selected Advisers, LP, a Colorado limited partnership
(the Subadviser).
WHEREAS, the Manager has entered into a Management Agreement, dated
February _, 2001 (the Management Agreement), with Strategic Partners Series (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 Strategic Partners Focused Value Fund (the Fund),
pursuant to which PIFM will act as Manager of the Fund; and
WHEREAS, PIFM desires to retain the Subadviser to provide investment
advisory services to the Fund and to manage such portion of the Fund 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 Fund as the Manager shall direct and shall manage the
composition of the Fund's portfolio, including the purchase, retention and
disposition thereof, in accordance with the Fund'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
Fund'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 Fund, 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 Fund and with the
written instructions and directions of the Manager and of the Board of
Trustees of 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 Fund, 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 Fund's Prospectus or as the Board of
Trustees may direct from time to time. In providing the Fund 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 Fund's investment transaction business. It is also understood
that it is desirable for the Fund 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 Fund 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 Fund 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 Fund 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 made by the
Subadviser in the manner the Subadviser considers to be the most equitable and
consistent with its fiduciary obligations to the Fund and to such other clients.
2
(iv) The Subadviser shall maintain all books and records with respect
to the Fund'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 Fund'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 Fund's Custodian on each business
day with information relating to all transactions concerning the portion of
the Fund'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 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.
3
(c) The Subadviser shall keep the Fund'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 Fund
required by Rule 31a-1 under the 1940 Act. The Subadviser agrees that all
records that it maintains for the Fund are the property of the Fund, 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 Fund 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 Fund's average daily net assets of the
portion of the Fund 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 Fund 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 Fund 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
1940 Act) 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 1940 Act) or upon the
termination of the Management Agreement. The Subadviser agrees that it will
4
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
1940 Act) of this Agreement, including, but not limited to, a change or
anticipated change in control (as defined in the 1940 Act) 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 0000 Xxxx Xxxxxx
Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx Xxxx, Chief Operating
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 Fund 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
Fund 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.
5
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
-----------------------------
Xxxxxx X. Xxxxx
Executive Vice President
XXXXX SELECTED ADVISERS, LP
BY: /s/ Xxxxxxx Xxxx
-----------------------------
Xxxxxxx Xxxx
Chief Operating Officer
6
SCHEDULE A
----------
STRATEGIC PARTNERS SERIES
STRATEGIC PARTNERS FOCUSED VALUE FUND
(Xxxxx Selected Advisers, LP)
As compensation for the Subadviser's services, PIFM will pay the Subadviser a
fee equal, on an annualized basis, to the following:
0.50% of average daily net assets of the portion of the Fund advised by the
Subadviser on total Fund assets up to and including $1 billion; and
0.40% of average daily net assets of the portion of the Fund advised by the
Subadviser on total Fund assets in excess of $1 billion.
Dated as of February 13, 2001
7
