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EXHIBIT (d)(2)(i)
THE TARGET PORTFOLIO TRUST
(Large Capitalization Value Portfolio)
SUBADVISORY AGREEMENT
Agreement made on this 25th day of May, 2000, between Prudential
Investments Fund Management LLC (PIFM or the Manager), a New York limited
liability company, and ▇.▇. ▇▇▇▇▇▇ Investment Management Inc. (the Adviser), a
Delaware corporation.
WHEREAS, PIFM has entered into a management agreement (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 ▇▇▇▇ (▇▇▇ ▇▇▇▇ ▇▇▇), pursuant to which PIFM will act
as manager of the Trust.
WHEREAS, shares of the Trust are divided into separate series or
portfolios (each a portfolio), each of which is established pursuant to a
resolution of the Trustees of the Trust, and the Trustees may from time to time
terminate such portfolios or establish and terminate additional portfolios.
WHEREAS, PIFM has the responsibility of evaluating, recommending,
supervising and compensating investment advisers to each portfolio of the Trust
and desires to retain the Adviser to provide investment advisory services to the
Large Capitalization Value Portfolio of the Trust (the Fund) in connection with
the management of the Trust and to manage such portion of the Fund as the
Manager shall from time to time direct, and the Adviser is willing to render
such investment advisory services.
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NOW, THEREFORE, the Parties agree as follows:
1. (a) Subject to the supervision of the Manager and of the Trustees of
the Trust, the Adviser shall manage such portion of the investment
operations of the Fund as the Manager shall direct and shall manage the
composition of such portion of the Fund, including the purchase,
retention and disposition thereof, in accordance with the Fund's
investment objective, policies and restrictions as stated in the
Prospectus (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") as delivered to the Adviser from
time to time by the Manager and subject to the following
understandings:
(i) The Adviser shall provide supervision of such portion of
the Fund's investments and 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 it manages will be invested or held
uninvested as cash.
(ii) In the performance of its duties and obligations under
this Agreement, the Adviser shall act in conformity with the Agreement
and Declaration of Trust, By-Laws and Prospectus of the Trust and the
Fund as provided to the Adviser by the Manager and with the written
instructions and directions of the Manager and of the 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
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regulations.
(iii) The Adviser shall determine the securities and
commodities or other assets to be purchased or sold by such portion of
the Fund and will place orders pursuant to its determination with or
through such persons, brokers, dealers or futures commission merchants
to carry out the policy with respect to brokerage as set forth in the
Trust's Registration Statement and Prospectus. In selecting brokers,
dealers or futures commissions merchants to execute transactions for
the Fund, it is recognized that the Adviser will give primary
consideration to securing best execution. Within the framework of this
policy, the Adviser 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 Adviser's other
clients may be a party. It is understood that Prudential Securities
Incorporated may be used as a broker for securities transactions
subject to the requirements of the 1940 Act and the Adviser's
determination of best execution. It is also understood that it is
desirable for the Trust that the Adviser 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 Trust than may result
when allocating brokerage to other brokers solely on the basis of
seeking lowest price. Therefore, the Adviser is authorized to place
orders for the purchase and sale of securities and commodities or other
assets for the Fund with such brokers or futures commission
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merchants, subject to review by the 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 Adviser in connection with
the Adviser's services to other clients.
On occasions when the Adviser deems the purchase or sale of a
security, commodity or other asset to be in the best interest of the
Fund as well as other clients of the Adviser, the Adviser, to the
extent permitted by applicable laws and regulations, may, but shall be
under no obligation to, aggregate the securities, commodities or other
assets to be sold or purchased. In such event, allocation of the
securities, commodities or other assets so purchased or sold, as well
as the expenses incurred in the transaction, will be made by the
Adviser in the manner the Adviser considers to be the most equitable
and consistent with its fiduciary obligations to the Trust and to such
other clients.
(iv) The Adviser shall maintain all books and records with
respect to the 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 Trustees such periodic and special
reports as the Board may reasonably request.
(v) The Adviser shall provide the Trust's custodian (the
Custodian) by 10:00 a.m. (New York time) each business day with
information relating to all transactions that occurred on the previous
business day concerning the portion of the Fund's assets it manages and
shall provide the Manager with such information upon request of the
Manager. The Adviser shall reconcile its records of the Fund's
securities and cash
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managed by the Adviser with statements provided by the Custodian at
least once each month. The Adviser shall provide the Manager with a
written report on each such reconciliation, including information on
any discrepancies noted and actions taken by the Adviser in response
thereto, by the tenth business day of the following month to the extent
reasonably practicable.
(vi) The investment management services provided by the
Adviser hereunder are not exclusive, and the Adviser shall be free to
render similar services to others.
(b) Services to be furnished by the Adviser under this
Agreement may be furnished through the medium of any of its directors, officers,
employees, affiliates or agents.
(c) The Adviser shall keep the Fund's books and records
required to be maintained by the Adviser pursuant to paragraph 1(a)(iv) hereof
and shall timely furnish to the Manager all information relating to the
Adviser's services hereunder needed by the Manager to keep the other books and
records of the Trust required by Rule 31a-1 under the 1940 Act. The Adviser
agrees that all records which it maintains for the Fund are the property of the
Trust and the Adviser will surrender promptly to the Trust any of such records
upon the Trust's request. The Adviser 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 Adviser agrees to maintain adequate compliance
procedures to comply with the 1940 Act, the Investment Advisers Act of 1940
(Advisers Act) and other applicable state and federal laws and regulations.
(e) The Adviser shall furnish to the Manager copies of all
records prepared in
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connection with (i) the performance of this Agreement and (ii) any reports
prepared in accordance with the compliance procedures maintained 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 shall
oversee and review the Adviser's performance of its duties under this Agreement.
3. The Manager shall compensate the Adviser for the services provided
and the expenses assumed pursuant to this Subadvisory Agreement at the annual
rate of .30 of 1% of the average daily net assets of the portion of the Fund
managed by the Adviser. This fee will be computed daily and paid monthly.
4. The Adviser shall not be liable for any error of judgment or for any
loss suffered by the Fund, 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 Adviser'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 Adviser under federal or state securities laws. The Manager shall indemnify
the Adviser, 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's 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 Adviser shall indemnify the Manager, its
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affiliated persons, its officers, directors and employees, for any liability and
expenses, including attorneys fees, which may be sustained as a result of the
Adviser's 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.
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 Trustees or by vote of a
majority of the outstanding voting securities (as defined in the ▇▇▇▇ ▇▇▇) of
the Fund, or by the Manager or the Adviser 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 ▇▇▇▇ ▇▇▇) and five business days after the
Adviser receives written notice of the termination of the Management Agreement.
6. Nothing in this Agreement shall limit or restrict the right of any
of the Adviser's directors, officers or employees 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 dissimilar nature, nor
limit the Adviser'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
Adviser at its principal office all prospectuses, proxy statements, reports to
shareholders, sales literature or
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other material prepared for distribution to shareholders of the Trust or the
public, which refer to the Adviser in any way; provided, however, that any such
item which describes or characterizes the Adviser or any of its affiliates, the
Adviser's investment process with respect to the Fund, the names of any of its
clients (other than the Trust or advisory clients of PIFM and its affiliates) or
any of its performance results shall be furnished to the Adviser by first class
or overnight mail, facsimile transmission equipment or hand delivery prior to
use thereof, and such item shall not be used if the Adviser reasonably objects
to such use in writing within forty-eight (48) hours (or such other time as may
be mutually agreed) after receipt thereof (provided, however, that if such item
is not received by the Adviser during normal business hours on a business day,
such period shall end forty-eight (48) hours after the start of normal business
hours on the next succeeding business day).
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.
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9. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below on the day and year first above
written.
PRUDENTIAL INVESTMENTS FUND MANAGEMENT LLC
By
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President
▇.▇. ▇▇▇▇▇▇ INVESTMENT MANAGEMENT INC.
By
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▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
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