INVESTMENT SUB-ADVISORY AGREEMENT
SEI INSTITUTIONAL INVESTMENTS TRUST
AGREEMENT made this 7th day of December, 2000 between SEI Investments
Management Corporation (the "Adviser") and Peregrine Capital Management, Inc.
(the "Sub-Adviser").
WHEREAS, SEI Institutional Investment 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 acts as investment adviser to the Large Cap Fund and Large Cap
Growth Fund (each a "Portfolio" and collectively, the "Portfolios"), each of
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 Portfolios, and the Sub-Adviser is willing
to render such investment advisory services.
NOW, THEREFORE, the parties hereto agree as follows as to each
Portfolio:
1. DUTIES OF THE SUB-ADVISER. Subject to supervision by the Adviser and
the Trust's Board of Trustees, the Sub-Adviser shall manage all of the
securities and other assets of the Portfolio entrusted to it hereunder
(the "Assets"), 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 (referred to collectively as
the "Prospectus"), and subject to the following:
(a) The Sub-Adviser shall, in consultation with and subject to the
direction of the Adviser, 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.
(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 as provided in subparagraph (a) 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
Registration Statement (as defined herein) and Prospectus or as the
Board of Trustees or the Adviser may direct from time to time, in
conformity with all federal securities laws. In
1
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 provided (as those terms are defined in Section
28(e) of the Securities Exchange Act of 1934). Consistent with any
guidelines established by the Board of Trustees of the Trust and
Section 28(e) of the Exchange Act, the Sub-Adviser is authorized 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 in terms of the overall responsibilities of
the Sub-Adviser to its discretionary clients, including the Portfolio.
In addition, the Sub-Adviser is authorized to allocate purchase and
sale orders for securities to brokers or dealers (including brokers and
dealers that are affiliated with the Adviser, Sub-Adviser or the
Trust's principal underwriter) and 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,
Sub-Adviser, the Trust's principal underwriter, or any affiliated
person of either the Trust, 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 ("SEC") 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. The Sub-Adviser shall provide to the Adviser or the Board of
Trustees such periodic and special reports, balance sheets or financial
information, and such other information with regard to its affairs 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 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. 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 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 surrender promptly to the Portfolio
any of such records
2
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 this 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.
(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 Sub-Adviser shall review all proxy solicitation materials and be
responsible for voting and handling all proxies in relation to the
securities held as Assets in the Portfolio. The Adviser shall instruct
the custodian and other parties providing services to the Portfolio to
promptly forward misdirected proxies to the Sub-Adviser.
Services to be furnished by the Sub-Adviser under this Agreement may be
furnished through the medium of any of the Sub-Adviser's control
affiliates, 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 in connection with its management of the Assets, nothing
herein shall be construed to relieve the Sub-Adviser of responsibility
for compliance with the Trust's Declaration of Trust (as defined
herein), the Prospectus, the instructions and directions of the Board
of Trustees of the Trust, 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.
3. DELIVERY OF DOCUMENTS. The Adviser has furnished the Sub-Adviser with
copies properly certified or authenticated of each of the following
documents:
(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");
3
(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, are herein called the
"By-Laws"); and
(c) Prospectus of the Portfolio.
The Adviser will furnish copies of amendments to the documents
specified above to the Sub-Adviser or otherwise provide reasonable notification
of changes to any terms of such documents affecting Sub-Adviser's obligations
under this Agreement.
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
which is attached hereto and made part of this Agreement. The fee will
be calculated based on the average monthly market value of the Assets
under the Sub-Adviser's management and will be paid to the Sub-Adviser
monthly. Except as may otherwise be prohibited by law or regulation
(including any then current SEC staff interpretation), the Sub-Adviser
may, in its discretion and from time to time, waive a portion of its
fee.
5. 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 the performance
of the Sub-Adviser's obligations under this Agreement; provided,
however, that the Sub-Adviser's obligation under this Section 5 shall
be reduced to the extent that 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.
6. DURATION AND TERMINATION. This Agreement shall become effective upon
approval by the Trust's Board of Trustees and its execution by the
parties hereto. Pursuant to the exemptive relief obtained in the SEC
Order dated April 29, 1996, Investment Company Act Release No. 21921,
approval of the Agreement by a majority of the outstanding voting
securities of the Portfolio is not required, and the Sub-Adviser
acknowledges that it and any other sub-adviser so selected and approved
shall be without the protection (if any) 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
4
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 6, 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 SEC under the 1940 Act.
7. 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.
8. 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.
9. 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 Investments Management Corporation
Xxx Xxxxxxx Xxxxxx Xxxx
Xxxx, XX 00000
Attention: Legal Department
To the Sub-Adviser at: Peregrine Capital Management, Inc.
000 XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxx
10. NON-HIRE/NON-SOLICITATION. The Sub-Adviser hereby agrees that so long
as the Sub-Adviser provides services to the Adviser or the Trust and
for a period of one year following the date on which the Sub-Adviser
ceases to provide services to the Adviser and the Trust, the
Sub-Adviser shall not for any reason, directly or indirectly, on the
Sub-Adviser's own behalf or on behalf of others, hire any person
employed by the Adviser, whether or not such person is a full-time
employee or whether or not any person's employment is pursuant to a
written agreement or is at-will. The Sub-Adviser further agrees that,
to the extent that the Sub-Adviser breaches the covenant described in
this paragraph, the Adviser shall be entitled to pursue all appropriate
remedies in law or equity.
5
11. 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 deemed to be an original, but such counterparts
shall, together, constitute only one instrument.
In the event the terms of this Agreement are applicable to more than
one portfolio of the Trust (for purposes of this Section 11, each a
"Portfolio"), the Adviser is entering into this Agreement with the
Sub-Adviser on behalf of the respective Portfolios severally and not
jointly, with the express intention that the provisions contained in
each numbered paragraph hereof shall be understood as applying
separately with respect to each Portfolio as if contained in separate
agreements between the Adviser and Sub-Adviser for each such Portfolio.
In the event that this Agreement is made applicable to any additional
Portfolios by way of a Schedule executed subsequent to the date first
indicated above, provisions of such Schedule shall be deemed to be
incorporated into this Agreement as it relates to such Portfolio so
that, for example, the execution date for purposes of Section 6 of this
Agreement with respect to such Portfolio shall be the execution date of
the relevant Schedule.
12. MISCELLANEOUS.
(a) 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 Portfolios or the Trust.
(b) 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 SEC, whether of special or general application, such provision
shall be deemed to incorporate the effect of such rule, regulation or
order.
6
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 INVESTMENTS MANAGEMENT CORPORATION PEREGRINE CAPITAL MANAGEMENT, INC.
By: By:
/s/ Xxxx Xxxxxxxxx /s/ Xxxx X. Xxxx
---------------------------------- --------------------------------------------
Name: Name:
Xxxx Xxxxxxxxx Xxxx X. Xxxx
---------------------------------- --------------------------------------------
Title: Title:
Senior Vice President Senior Vice President and Portfolio Manager
---------------------------------- ------------------------------------------------
7
SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
BETWEEN
SEI INVESTMENTS MANAGEMENT CORPORATION
AND
PEREGRINE CAPITAL MANAGEMENT, INC.
Pursuant to Paragraph 4, the Adviser shall pay the Sub-Adviser compensation at
an annual rate as follows:
SEI INSTITUTIONAL INVESTMENTS TRUST
Large Cap Fund X.XX% *
Large Cap Growth Fund X.XX% *
* Provided that if the combined Assets under the management of the Sub-Adviser
for all of the SEI Trusts is less than $3 billion as of December 31, 2002, the
Adviser shall thereafter pay the Sub-Adviser compensation at the rate of 0.25%.
Agreed and Accepted:
SEI INVESTMENTS MANAGEMENT CORPORATION PEREGRINE CAPITAL MANAGEMENT, INC.
By: By:
/s/ Xxxx Xxxxxxxxx /s/ Xxxx X. Xxxx
---------------------------------- --------------------------------------------
Title: Title:
Senior Vice President Senior Vice President and Portfolio Manager
---------------------------------- ------------------------------------------------
8
