THE PILLAR FUNDS
INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT made this 28th day of April, 1995, by and among United Jersey
Bank Investment Management Division, a division of United Jersey Bank, (the
"Adviser"), Wellington Management Company, a Massachusetts general partnership
(the "Sub-Adviser") and The Pillar Funds, a Massachusetts business trust (the
"Trust").
WHEREAS, 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
of even date herewith (the "Advisory Agreement") with the Trust, pursuant to
which the Adviser will act as investment adviser to the International Growth
Portfolio (the "Portfolio"), and
WHEREAS, the Adviser and the Trust each desire to retain the
Sub-Adviser to provide investment sub-advisory services to the Trust in
connection with the management of the Portfolio and such other portfolios as the
Trust, the Adviser and the Sub-Adviser may agree upon by written addenda to this
Agreement, and the Sub-Adviser is willing to render such investment advisory
services.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and intending to be legally bound, the parties hereto agree as
follows:
1. (a) Subject to supervision by the Adviser and the Trust's Board of
Trustees, the Sub-Adviser shall manage the investment operations of
the Portfolio and the composition of the Portfolio, including the
purchase, retention and disposition thereof, in accordance with the
Portfolio's investment objectives, policies and restrictions as
stated in the Portfolio's Prospectus (such Prospectus and the
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:
(1) The Sub-Adviser shall determine from time to time what
investments and securities will be purchased, retained or sold
by the Portfolio, and what portion of the assets will be
invested or held uninvested in cash.
(2) 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 and By-Laws (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.
(3) The Sub-Adviser shall 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
federal securities laws. In providing the Portfolio with
investment sub-advisory
services, the Sub-Adviser will give primary consideration to
securing the most favorable price and efficient execution.
Within the framework of this policy, the Sub-Adviser may
consider the financial responsibility, research and investment
information and other services provided by brokers or dealers
who may effect or be a party to any such transaction or other
transactions to which the Sub-Adviser's other clients may be a
party. It is understood that it is desirable for the Portfolio
that the Sub-Adviser have access to supplemental investment and
market research and security and economic analysis provided by
brokers who may execute brokerage transactions at higher cost to
the Portfolio than may result when allocating brokerage to other
brokers on the basis of seeking the most favorable price and
efficient execution. Therefore, the Sub-Adviser is authorized to
place orders for the purchase and sale of securities for the
Portfolio with such brokers, 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 may be useful to the
Sub-Adviser in connection with the Sub-Adviser's services to
other clients.
On occasions when the Sub-Adviser deems the purchase or sale
of a security to be in the best interest of the Portfolio as
well as other clients of the Sub-Adviser, the Sub-Adviser, to
the extent permitted by applicable laws and regulations, may,
but shall be under no obligation to, aggregate the securities to
be so purchased or sold in order to obtain the most favorable
price or lower brokerage commissions and efficient execution. In
such event, allocation of the securities so purchased or sold,
as well as the expenses incurred in the transaction, will be
made by the Sub-Adviser in the manner it considers to be the
most equitable and consistent with its fiduciary obligation to
the Portfolio and to such other clients.
(4) The Sub-Adviser shall maintain all books and records with
respect to the Portfolio'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
Board of Trustees such periodic and special reports as the Board
of Trustees may reasonably request.
(5) 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.
(6) The investment sub-advisory 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.
(7) The Sub-Adviser shall provide such reports and data in hard copy
and machine readable form as are requested by the Adviser and
which are consistent with the Sub-Adviser's normal data
production capabilities.
(8) The Sub-Adviser shall prepare a quarterly broker security
transaction summary and monthly security transaction listing for
the Portfolio.
(9) Unless the Board of Trustees of the Trust or the Adviser directs
otherwise in a particular instance or generally, the Sub-Adviser
shall take reasonable measures to vote, give and withhold
consents with respect to, and take all other similar actions
relating to, the securities and other investments owned by the
Portfolio.
(10) The Sub-Adviser shall report regularly to the Adviser and shall
make appropriate persons available for the purpose of reviewing
at reasonable times with representatives of the Adviser and the
Board of Trustees of the Trust the management of the Portfolio,
including, without limitation, review of the general investment
strategy of the Portfolio, the performance of the Portfolio in
relation to standard industry indices, interest rate
considerations and general conditions affecting the marketplace
and shall provide various other reports from time to time as
reasonably requested by the Adviser.
(11) The Sub-Adviser shall treat confidentially and as proprietary
information of the Trust all such records and other information
relative to the Trust maintained by the Sub-Adviser, and shall
not use such records and information for any purpose other than
performance of its responsibilities and duties hereunder, except
after prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably withheld and may
not be withheld where the Sub-Adviser may be exposed to civil or
criminal contempt proceeding for failure to comply, when
requested to divulge such information by duly constituted
authorities, or when so requested by the Trust.
(b) 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.
(c) The Sub-Adviser shall keep the Portfolio's books and records
required to be maintained by the Sub-Adviser pursuant to paragraph
1(a) of 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 agrees that all records that it maintains on behalf of
the Portfolio are property of the Portfolio and the SubAdviser
shall 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. The Sub-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) of this Agreement.
2. For all purposes of this Agreement the Sub-Adviser shall be deemed
to be an independent contractor, and shall have no authority to act
as agent for the Adviser or the Trust in any manner or in any
respect.
3. The Adviser has delivered to the Sub-Adviser copies of each of the
following documents and shall deliver to it all future amendments
and supplements, if any:
(a) The Trust's 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, are
herein called the "By-Laws");
(c) Certified resolutions of the Board of Trustees of the Trust
authorizing the appointment of the Adviser and the
Sub-Adviser with respect to the Portfolio, and approving the
form of this Agreement;
(d) Registration Statement under the 1940 Act and the Securities
Act of 1933, as amended, on Form N-1A (the "Registration
Statement"), as filed with the Securities and Exchange
Commission (the "Commission") relating to the Portfolio and
shares of the Portfolio, and all amendments thereto;
(e) Notification of Registration of the Trust under the 1940 Act
on Form N-8A as filed with the Commission, and all
amendments thereto; and
(f) Prospectus(es) of the Portfolio
4. During the term of this Agreement, the Sub-Adviser shall pay all
expenses incurred by it in connection with its activities under
this Agreement other than the cost of securities (including
brokerage commissions, if any) purchased for the Portfolio. For the
services provided and the expense assumed by the Sub-Adviser
pursuant to this Agreement, the Adviser shall pay the Sub-Adviser,
and the Sub-Adviser agrees to accept as full compensation therefor,
a sub-advisory fee at an annual rate of .60% on the first $50
million, .45% on the next $100 million and .30% over $150 million
of the Portfolio's average daily net assets. This fee shall be
computed daily and 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. The Sub-Adviser shall not be liable for any error of judgment or
for any loss suffered by the Portfolio or 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 gross 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. This Agreement shall become effective as of the date hereof with
respect to the Portfolio and, unless sooner terminated as provided
herein, shall continue in effect with respect to the Portfolio
until February, 28, 1997. Thereafter, if not terminated, this
Agreement shall automatically continue in effect as to the
Portfolio for successive annual periods, provided such continuance
is specifically approved at least annually (a) by the vote of a
majority of those members of the Trust's Board of Trustees who are
not interested persons of any party to this Agreement, cast in
person at a meeting called for the purpose of voting on such
approval, and (b) by the Trust's Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio;
provided,
however, that if the shareholders of the Portfolio fail to approve
the continuance of this Agreement as provided herein, the
Sub-Adviser may continue to serve hereunder in the manner and to
the extent permitted under the 1940 Act and the rules and
regulations thereunder. The foregoing requirement that continuance
of this Agreement be "specifically approved at least annually"
shall be construed in a manner consistent with the 1940 Act and the
rules and regulations thereunder.
Notwithstanding the foregoing, this Agreement may be terminated as
to the Portfolio at any time, without the payment of any penalty,
by the Trust (by vote of the Trust's Board of Trustees or by vote
of a majority of the outstanding securities of the Portfolio), by
the Adviser, or by the Sub-Adviser on sixty days' written notice to
each of the other parties hereto. This Agreement shall terminate
automatically and immediately in the event of its assignment, and
shall also terminate automatically and immediately upon the
termination of the Advisory Agreement.
As used in this Section 6, the terms "assignment," "interested
persons" 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.
7. As long as the services to the Adviser and the Trust under this
Agreement are not impaired, nothing in this Agreement shall limit
or restrict the right of any of the Sub-Adviser's partners,
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 or restrict the Sub-Adviser's right to engage in any
other business or to render services of any kind to any other
corporation, firm, individual or association.
8. During the term of this Agreement, the Trust 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
Portfolio 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 Trust 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.
9. The terms or provisions of this Agreement may be amended, modified
or waived in writing if such amendment, modification or waiver is
approved by the affirmative vote or action by written consent of
the Board of Trustees of the Trust and by the Adviser and
Sub-Adviser in accordance with the 1940 Act; provided, that an
amendment, modification or waiver shall also be approved by the
shareholders of the Trust if shareholder approval is required by
the 1940 Act and the rules and regulations thereunder.
10. This Agreement shall be governed by the laws of the Commonwealth of
Massachusetts; provided, however, that nothing herein shall be
construed as being inconsistent with the 1940 Act.
11. This Agreement embodies the entire agreement and understanding
among the parties hereto with respect to the services to be
provided by the Sub-Adviser, 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.
12. 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.
13. Any notice, advice or report to be given pursuant to this Agreement
shall be delivered or mailed:
To the Adviser at:
United Jersey Bank
000 Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: President
To the Sub-Adviser at:
Wellington Management Company
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Legal Department
To the Trust or the Portfolio at:
The Pillar Funds
c/o SEI Corporation
000 Xxxx Xxxxxxxxxx Xxxx
Xxxxx, XX 00000
Attention: Legal Department
Any party may change its address for notices, advices or reports
hereunder by giving notice of such change to the other parties in
accordance with this Section 13.
14. 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.
A copy of the Agreement and Declaration of Trust of the Trust is on
file with the Secretary of State of the Commonwealth of Massachusetts, and
notice is hereby given that this instrument is executed on behalf of the
Trustees of the Trust as Trustees, and is not binding upon any of the Trustees,
officers, or shareholders of the Trust individually but binding
only upon the assets and property of the Portfolio of the Trust. No
portfolio of the Trust shall be liable for any other portfolio of the
Trust. Without limiting the generality of the foregoing, the
Sub-Adviser shall look only to the assets of the Portfolio for payment
of fees for services rendered to the Portfolio.
In the event that there is a change in the partners of the Sub-Adviser,
the Sub-Adviser shall notify the Adviser and the Trust within a reasonable
period of time.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their of officers designated below as of the day and year first
written above.
United Jersey Bank Investment Management Wellington Management Company
Division, a division of United Jersey Bank
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ Xxxxxx X. XxXxxxxxx
-------------------------------- -----------------------------
Title: Senior Vice President Title: President
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The Pillar Funds
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------
Title: Vice President
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