PRUDENTIAL WORLD FUND, INC.
PRUDENTIAL GLOBAL GROWTH FUND
SUBADVISORY AGREEMENT
Agreement made as of this 28th day of March, 2001 between Prudential
Investments Fund Management LLC ("PIFM" or the "Manager") and Xxxxxxxx
Associates LLC (the "Subadviser").
WHEREAS, the Manager has entered into a Management Agreement, dated March
28, 2001 (the "Management Agreement"), with Prudential World Fund, Inc. -
Prudential Global Growth Fund (the "Fund"), a Maryland corporation and a
diversified, open-end management investment company registered under the
Investment Company Act of 1940 (the "1940 Act"), pursuant to which PIFM acts 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; and
WHEREAS, this Agreement is intended to supersede the agreement dated
February 28, 1988, as amended January 1, 2000, between PIFM and The Prudential
Investment Corporation;
NOW, THEREFORE, the Parties agree as follows:
1. (a) Subject to the supervision of the Manager and the Board of
Directors of the Fund, 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(s), including the
purchase, retention and disposition thereof, in accordance with the
Fund's investment objectives, 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"), 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 Articles of Incorporation, By-Laws and Prospectus of
the Fund and with the instructions and directions of the
Manager and of the Board of Directors of the Fund, co-operate
with the Manager's (or its designee's) personnel responsible
for monitoring the Fund's compliance 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
therewith, 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 Directors 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
Fund's Board of Directors 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.
(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 Fund's Board of Directors such periodic and
special reports as the Directors may reasonably request. The
Subadviser shall make reasonably available its employees and
officers for consultation with any of the Directors or officers
or
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employees of the Fund with respect to any matter herein,
including, without limitation, the valuation of the Fund's
securities.
(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 Fund's Board as
to whether the contract with one or more subadvisers should be
renewed, modified, or terminated and (iii) periodically report
to the Fund's Board regarding the results of its evaluation and
monitoring functions. 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 Directors or officers of the
Fund 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 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 which it maintains for the Fund
are the property of the Fund, and the Subadviser will surrender promptly
to the Fund any of such records upon the Fund'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 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
to ensure its compliance with the 1940 Act, the Investment Advisers Act
of 1940 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
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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 Directors of the Fund 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.
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
Director, officer or employee of the Fund 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.
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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 XXXXXXXX ASSOCIATES LLC
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxx
------------------- -------------------
Xxxxxx X. Xxxxx Xxxxx X. Xxxxxx
Executive Vice President Executive Vice President
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EXHIBIT A
FUND Annual fee payable to the Subadviser as a
---- percentage of average daily net assets
Prudential World Fund, Inc.
Prudential Global Growth Fund 0.375%
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