INVESTMENT SUB-ADVISORY AGREEMENT
SEI INSTITUTIONAL INVESTMENTS TRUST
AGREEMENT made this 14th day of June, 1996, by and among SEI Financial
Management Corporation, (the "Adviser") and Xxxxxxxxxx Asset Management, L.P.
(the "Sub-Adviser").
WHEREAS, SEI Institutional Investments Trust, a Massachusetts business
trust (the "Trust") is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Adviser has entered into an Investment Advisory Agreement
dated June 14, 1996 (the "Advisory Agreement") with the Trust, pursuant to
which the Adviser will act as investment adviser to the Emerging Markets Equity
Portfolio (the "Portfolio"), which is a series of the Trust; and
WHEREAS, the Adviser, with the approval of the Trust, desires to retain the
Sub-Adviser to provide investment advisory services to the Adviser in connection
with the management of the Portfolio, and the Sub-Adviser is willing to render
such investment advisory services.
NOW, THEREFORE, the parties hereto agree as follows:
1. DUTIES OF THE SUB-ADVISER. Subject to supervision and direction by the
Adviser and the Trust's Board of Trustees, the Sub-Adviser shall
manage on a discretionary basis the investment operation of all of the
securities and other assets of the Portfolio entrusted to it hereunder
(the "Assets") and the composition of the Portfolio, including the
purchase, retention and disposition of the Assets, in accordance with
the Portfolio's investment objectives, policies and restrictions as
stated in the Portfolio's prospectus and statement of additional
information, as currently in effect and as amended or supplemented
from time to time by written notice to the Sub-Adviser (referred to
collectively as the "Prospectus"), and subject to the following:
(a) The Sub-Adviser shall provide supervision of the Assets and determine
from time to time what Assets will be purchased, retained or sold by
the Portfolio, and what portion of the Assets will be invested or held
uninvested in cash. In furtherance of the forgoing, the Adviser hereby
designates and appoints the Sub-Adviser as agent and attorney-in-fact
of the Trust, with authority and without further approval of the
Adviser (except as expressly provided for herein or as may be required
by law) to make and execute, in the name and on behalf of the
Portfolio, all agreements, instruments and other documents and to take
all such other action which the Sub-Adviser considers necessary or
advisable to carry out its duties hereunder. By way of example and not
by way of limitation, in connection with any purchase for the
Portfolio of securities that are not registered under the Securities
Act of 1933, as amended (the "Securities Act"), the Sub-Adviser shall
have authority, among other things to: (i) commit to purchase such
securities for the Portfolio on the terms and conditions under which
such securities are offered; (ii) execute such agreements, instruments
and documents (including, without limitation, purchase agreements and
subscription documents), and make such commitments, as may be required
or otherwise in connection with the purchase and sale or such
securities; (iii) represent that the Portfolio is an "accredited
investor" under the Securities Act; and (iv) commit that such
securities will not be offered or sold by the Portfolio except in
compliance with the registration requirements of the Securities Act or
an exemption therefrom. This power-of-attorney is a continuing
power-of-attorney and shall remain in full force and effect until
revoked by the Adviser in writing, but any such revocation shall not
affect any transaction initiated prior to receipt by the Sub-Adviser
or such notice.
(b) In the performance of its duties and obligations under this
Agreement, the Sub-Adviser shall act in conformity with the Trust's
Declaration of Trust (as defined herein) and the Prospectus and with
the instructions and directions of the Adviser 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, and
all other applicable federal and state laws and regulations, as each
is amended from time to time.
(c) The Sub-Adviser shall determine the Assets to be purchased or sold by
the Portfolio and will place orders with or through such persons,
brokers or dealers to carry out the policy with respect to brokerage
set forth in the Portfolio's Prospectus or as the Board of Trustees or
the Adviser may direct from time to time, in conformity with federal
securities laws. In executing Portfolio transactions and selecting
brokers or dealers, the Sub-Adviser will use its best efforts to seek
on behalf of the Portfolio the best overall terms available. In
assessing the best overall terms available for any transaction, the
Sub-Adviser shall consider all factors that it deems relevant,
including the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the
broker or dealer, and the reasonableness of the commission, if any,
both for the specific transaction and on a continuing basis. In
evaluating the best overall terms available, and in selecting the
broker-dealer to execute a particular transaction the Sub-Adviser may
also consider the brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange Act of 1934)
provided to the Portfolio and/or other accounts over which the
Sub-Adviser or an affiliate of the Sub-Adviser may exercise investment
discretion. The Sub-Adviser is authorized, subject to the prior
approval of the Trust's Board of Trustees, to pay to a broker or
dealer who provides such brokerage and research services a commission
for executing a portfolio transaction for the Portfolio which is in
excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if, but only if, the
Sub-Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer - - viewed in terms of that
particular transaction or terms of the overall responsibilities of the
Sub-Adviser to the Portfolio. In addition, the Sub-Adviser is
authorized to allocate purchase and sale orders for portfolio
securities to brokers or dealers (including brokers and dealers that
are affiliated with the Adviser, the Sub-Adviser or the Trust's
principal underwriter) to take into account the sale of shares of the
Trust if the Sub-Adviser believes that the quality of the transaction
and the commission are comparable to what they would be with other
qualified firms. In no instance, however, will the Portfolio's Assets
be purchased from or sold to the Adviser, the Sub-Adviser, the Trust's
principal underwriter, or any affiliated person of either the Trust,
the Adviser, the Sub-Adviser or the principal underwriter, acting as
principal in the transaction, except to the extent permitted by the
Securities and Exchange Commission and the 1940 Act.
(d) The Sub-Adviser shall maintain all books and records with respect to
transactions involving the Assets 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 Adviser or Board of Trustees
such periodic and special reports as the Adviser or Board of Trustees
may reasonably request.
The Sub-Adviser shall keep the books and records relating to the
Assets required to be maintained by the Sub-Adviser under this
Agreement and shall timely furnish to the Adviser all information
requested by the Adviser relating to the Sub-Adviser's services under
this Agreement needed by the Adviser to keep the other books and
records of the Portfolio required by Rule 31a-1 under the 1940 Act.
Upon request, the Sub-Adviser shall also furnish to the Adviser any
other information relating to the Assets that is required to be filed
by the Adviser or the Trust with the Securities and Exchange
Commission ("SEC") or sent to shareholders under the 1940 Act
(including the rules adopted thereunder) or any exemptive or other
relief that the Adviser or the Trust obtains from the SEC. The
Sub-Adviser agrees that all records that it maintains on behalf of the
Portfolio are property of the Portfolio and the Sub-Adviser will
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surrender promptly to the Portfolio any of such records upon the
Portfolio's request,; provided, however, that the Sub-Adviser may
retain a copy of such records. In addition, for the duration of this
Agreement, the Sub-Adviser shall 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 this Agreement, and shall transfer
said records to any successor Sub-Adviser upon the termination of his
Agreement (or, if there is no successor Sub-Adviser, to the Adviser).
(e) The Sub-Adviser shall provide the Portfolio's custodian on each
business day with information relating to all transactions concerning
the Portfolio's Assets and shall provide the Adviser with such
information upon request of the Adviser.
(f) The investment management services provided by the Sub-Adviser under
this Agreement are not to be deemed exclusive and the Sub-Adviser
shall be free to render similar services to others, as long as such
services do not impair the services rendered to the Adviser or the
Trust.
The Sub-Adviser shall not be obligated to purchase or sell for
the Portfolio securities which the Sub-Adviser may purchase or sell or
recommend for purchase or sale for itself or for the portfolios of
other clients. Moreover, the Adviser acknowledges that circumstances
may arise under which the Sub-Adviser determines that while it would
be both desirable and suitable that a particular security be purchased
or sold for the account of more than one of the Sub-Adviser's
portfolios, there is a limited supply or demand for that security.
Under such circumstances, the Adviser acknowledges that, while the
Sub-Adviser will seek to allocate the opportunity to purchase or sell
that security among those portfolios on an equitable basis (including
as between portfolios of the Sub-Adviser's nondiscretionary clients, to
whom the Sub-Adviser makes recommendations, and portfolios of its
discretionary clients, such as the Portfolio), the Sub-Adviser shall
not be required to assure equality of treatment among all of its
clients (including that that opportunity to purchase or sell that
security will be proportionately allocated among those portfolios
according to any particular or predetermined standards or criteria).
Where, because of the prevailing market conditions, it is not
possible to receive the same price or time of execution for all of the
securities or other investments purchased or sold for the Portfolio,
transactions for the Portfolio may be reported with the average prices
of those transactions. In certain instances, the Sub-Adviser, in its
discretion, may place a large order to purchase or sell a particular
security or other investment for the Portfolio and the accounts of one
or more other clients. Because of the prevailing market conditions,
it is frequently not possible to receive the same price or time of
execution for all of the securities or other investments purchased or
sold. When this occurs, the Sub-Adviser will average the various prices
and charge or credit the Portfolio with the average price. In such
instances, the confirmation for such transaction sent to the Adviser
will disclose the average price. Upon request, the Sub-Adviser will
make the underlying records reflecting the actual transaction
available for the Adviser's inspection.
The Portfolio may include securities of companies for which
Xxxxxxxxxx Securities, an affiliate of the Sub-Adviser, acts as
investment banker or financial adviser or with which it has other
confidential relationships or in which it maintains a position or
makes a market or otherwise has an interest. The Adviser appreciates
that, for good commercial and legal reasons, nonpublic information (a)
which becomes available to Xxxxxxxxxx Securities through its
relationships or for any other reason cannot be passed on to the
Sub-Adviser or the Adviser, or used for the benefit of the Portfolio;
and (b) which becomes available to the Sub-Adviser for any reason
cannot be passed onto the Adviser or used for the benefit of the
Portfolio. The Adviser understands that Xxxxxxxxxx Securities, an
affiliate of the Sub-Adviser may provide investment banking,
investment advisory and brokerage services to persons other than the
Adviser. These activities may result in a conflict between the
interests of Xxxxxxxxxx
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Securities and the Adviser which, in certain circumstances, may
restrict the Sub-Adviser from trading or recommending the trading in
certain securities.
(g) The Sub-Adviser shall promptly notify the Adviser of any financial
condition that is likely to impair the Sub-Adviser's ability to
fulfill its commitment under this Agreement.
(h) The Adviser hereby authorizes the Sub-Adviser to receive and
confer upon the Sub-Adviser complete discretion to vote proxies
solicited by or with respect to the issuers of securities in which the
Assets may be invested from time to time ("Proxies"). The Sub-Adviser
shall vote all Proxies in a manner which, at the time of any Proxy
vote is cast, is consistent with the Sub-Adviser's good faith
judgment. The Adviser shall promptly deliver or cause to be delivered
to the Sub-Adviser all Proxies, including any information with respect
thereto, received by the Adviser or the Trust, or by any agent of the
Adviser or the Trust, including without limitation, any custodian of
the Assets. The Adviser shall hold the Sub-Adviser harmless for
failure to vote Proxies, which are not received by, or delivered to,
the Sub-Adviser in sufficient time to permit the Sub-Adviser to vote
such Proxies in accordance with the Sub-Adviser's good faith judgment.
Services to be furnished by the Sub-Adviser under this Agreement may
be furnished through the medium of any of the Sub-Adviser's partners,
officers or employees.
2. DUTIES OF THE ADVISER. The Adviser shall continue to have
responsibility for all services to be provided to the Portfolio
pursuant to the Advisory Agreement and shall oversee and review the
Sub-Adviser's performance of its duties under this Agreement;
provided, however, that nothing herein shall be construed to relieve
the Sub-Adviser of responsibility for compliance with the Portfolio's
investment objectives, policies, and restrictions, as provided in
Section 1 hereunder, in connection with its management of the Assets.
3. DELIVERY OF DOCUMENTS. The Adviser has furnished the Sub-Adviser with
copies properly certified or authenticated of each of the following
documents, and will provide the Sub-Adviser with any amendments
thereto prior to or immediately upon effectiveness:
(a) The Trust's Agreement and Declaration of Trust, as filed with the
Secretary of State of the Commonwealth of Massachusetts (such
Agreement and Declaration of Trust, as in effect on the date of this
Agreement and as amended from time to time, herein called the
"Declaration of Trust");
(b) By-Laws of the Trust (such By-Laws, as in effect on the date of this
Agreement and as amended from time to time, is herein called the
"By-Laws");
(c) Prospectus(es) of the Portfolio.
4. COMPENSATION TO THE SUB-ADVISER. For the services to be provided by
the Sub-Adviser pursuant to this Agreement, the Adviser will pay the
Sub-Adviser, and the Sub-Adviser agrees to accept as full compensation
therefor, a sub-advisory fee at the rate specified in the Schedule(s)
which is attached hereto and made part of this Agreement. The fee will
be calculated based on the average monthly market value
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of the Assets under the Sub-Adviser's management and will be paid to
the Sub-Adviser monthly. The Sub-Adviser may, in its discretion and
from time to time, waive a portion of its fee.
5. LIMITATION OF LIABILITY OF THE SUB-ADVISER. The Sub-Adviser shall not
be liable for any error of judgment or for any loss suffered by the
Adviser in connection with performance of its obligations under this
Agreement, except a loss resulting from a breach of fiduciary duty
with respect to the receipt of compensation for services (in which
case any award of damages shall be limited to the period and the
amount set forth in Section 36(b)(3) of the 1940 Act), or a loss
resulting from willful misfeasance, bad faith or negligence on the
Sub-Adviser's part in the performance of its duties or from reckless
disregard of its obligations and duties under this Agreement, except
as may otherwise be provided under provisions of applicable state law
which cannot be waived or modified hereby.
6. REPORTS. During the term of this Agreement, the Adviser agrees to
furnish the Sub-Adviser at its principal office all prospectuses,
proxy statements, reports to stockholders, sales literature or other
materials prepared for distribution to stockholders of the Portfolios,
the Trust or the public that refer to the Sub-Adviser or its clients in
any way prior to use thereof and not to use material if the Sub-Adviser
reasonably objects in writing within five business days (or such other
period as may be mutually agreed) after receipt thereof. The
Sub-Adviser's right to object to such materials is limited to the
portions of such materials that expressly relate to the Sub-Adviser,
its services and its clients. The Adviser agrees to use its reasonable
best efforts to ensure that materials prepared by its employees
or agents or its affiliates that refer to the Sub-Adviser or its
clients in any way are consistent with those materials previously
approved by the Sub-Adviser as referenced in the first sentence of this
paragraph. Sales literature may be furnished to the Sub-Adviser by
first class or overnight mail, facsimile transmission equipment or
hand delivery.
7. INDEMNIFICATION. The Sub-Adviser shall indemnify and hold harmless the
Adviser from and against any and all claims, losses, liabilities or
damages (including reasonable attorney's fees and other related
expenses) howsoever arising from or in connection with a breach by the
Sub-Adviser of its duties and obligations under this Agreement;
provided, however, that the Sub-Adviser shall not be required to
indemnify or otherwise hold the Adviser harmless under this Section 7
where the claim against, or the loss, liability or damage experienced
by the Adviser is caused by or is otherwise directly related to the
Adviser's own willful misfeasance, bad faith or negligence, or to the
reckless disregard of its duties under this Agreement.
The Adviser shall indemnify and hold harmless the Sub-Adviser from and
against any and all claims, losses, liabilities or damages (including
reasonable attorney's fees and other related expenses) howsoever
arising from or in connection with a breach by the Adviser of its
duties and obligations under this Agreement; provided, however, that
the Adviser shall not be required to indemnify or otherwise hold the
Sub-Adviser harmless under this Section 7 where the claim against, or
the loss, liability or damage experienced by the Sub-Adviser is caused
by or is otherwise directly related to the Sub-Adviser's own willful
misfeasance, bad faith or negligence, or to the reckless disregard of
its duties under this Agreement.
8. CUSTODY. The custodian of the assets comprising the Emerging Markets
Equity Portfolio will be State Street Bank and Trust Company (the
"Custodian"). The Assets will be maintained by the Custodian in a
subaccount, separately identified from the other assets of the
Emerging Markets Equity Portfolio and the Trust. All transactions with
respect to assets in the Portfolio will be carried out through the
Custodian or such other custodians of the Portfolio as approved or
appointed by the Portfolio.
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9. DURATION AND TERMINATION. This Agreement shall become effective upon
its approval by the Trust's Board of Trustees and by the vote of a
majority of the outstanding voting securities of the Portfolio;
provided, however, that at any time the Adviser shall have obtained
exemptive relief from the SEC permitting it to engage a Sub-Adviser
without first obtaining approval of the Agreement from a majority of
the outstanding voting securities of the Portfolio(s) involved, the
Agreement shall become effective upon its approval by the Trust's
Board of Trustees. Any Sub-Adviser so selected and approved shall be
without the protection accorded by shareholder approval of an
investment adviser's receipt of compensation under Section 36(b) of
the 1940 Act.
This Agreement shall continue in effect for a period of more than two
years from the date hereof only so long as continuance is
specifically approved at least annually in conformance with the 1940
Act; provided, however, that this Agreement may be terminated with
respect to the Portfolio (a) by the Portfolio at any time, without
the payment of any penalty, by the vote of a majority of Trustees of
the Trust or by the vote of a majority of the outstanding voting
securities of the Portfolio, (b) by 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 Sub-Adviser, or (c) by the
Sub-Adviser at any time, without the payment of any penalty, on 90
days' written notice to the Adviser. This Agreement shall terminate
automatically and immediately in the event of its assignment, or in
the event of a termination of the Adviser's agreement with the
Trust. As used in this Section 8, the terms "assignment" and "vote
of a majority of the outstanding voting securities" shall have the
respective meanings set forth in the 1940 Act and the rules and
regulations thereunder, subject to such exceptions as may be granted
by the Commission under the 1940 Act.
10. GOVERNING LAW. This Agreement shall be governed by the internal laws
of the Commonwealth of Massachusetts, without regard to conflict of
law principles; provided, however, that nothing herein shall be
construed as being inconsistent with the 1940 Act.
11. SEVERABILITY. Should any part of this Agreement be held invalid by a
court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors.
12. NOTICE: Any notice, advice or report to be given pursuant to this
Agreement shall be deemed sufficient if delivered or mailed by
registered, certified or overnight mail, postage prepaid addressed by
the party giving notice to the other party at the last address
furnished by the other party:
To the Adviser at: SEI Financial Management Corporation
000 Xxxx Xxxxxxxxxx Xxxx
Xxxxx, XX 00000
Attention: Legal Department
To the Sub-Adviser at: Xxxxxxxxxx Asset Management, L.P.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
13. ENTIRE AGREEMENT. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior
agreements and understandings relating to this Agreement's subject
matter. This Agreement may be executed in any number of counterparts,
each of which shall be
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deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
14. INFORMATION. The Sub-Adviser will notify the Adviser of any change in
the composition of its partners within a reasonable time after such
change.
15. ADVISER INFORMATION. For the purposes of complying with the laws of
the State of California, the Adviser hereby consents to the
disclosure to third parties of (i) the identity of the Portfolio as
part of a representative list of other clients of the Sub-Adviser,
(ii) investment results and other data of the Portfolio (other than
the identity of the Adviser) in connection with providing composite
investment results of the Sub-Adviser and (iii) investments and
transactions of the Portfolio (other than the identity of the
Adviser) in connection with proving composite information of the
Sub-Adviser.
A copy of the Declaration of Trust is on file with the Secretary of
State of the Commonwealth of Massachusetts, and notice is hereby given that
the obligations of this instrument are not binding upon any of the Trustees,
officers or shareholders of the Portfolio or the Trust.
Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is altered by a rule, regulation or order of the
Commission, whether of special or general application, such provision shall
be deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their officers designated below as of the day and year
first written above.
SEI Financial Management Corporation Xxxxxxxxxx Asset Management, L.P.
by Xxxxxxxxxx Asset Management, Inc.,
its General Partner
By: /s/ Xxxxx X. Xxxxxx By: Signature Appears Here
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Title: S.V.P. Title: Managing Director
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SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
BETWEEN
SEI FINANCIAL MANAGEMENT
CORPORATION
AND
XXXXXXXXXX ASSET MANAGEMENT, L.P.
Pursuant to Article 4, the Adviser shall pay the Sub-Adviser compensation at an
annual rate as follows:
Emerging Markets Equity Portfolio % up to $50 million
% over $50 million
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