INVESTMENT SUB-ADVISORY AGREEMENT
SEI INSTITUTIONAL INVESTMENTS TRUST
AGREEMENT made as of this 14th day of September, 1999, between SEI
Investments Management Corporation, (the "Adviser") and Security Capital Global
Capital Management Group Incorporated (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 Small Cap Fund (the "Fund"),
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 Fund, 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 by the Adviser and the
Trust's Board of Trustees, the Sub-Adviser shall manage all of the
securities and other assets of the Fund entrusted to it hereunder (the
"Assets"), including the purchase, retention and disposition of the Assets,
in accordance with the Fund's investment objectives, policies and
restrictions as stated in the Fund'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 Fund, 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
Fund 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 Fund'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
executing Fund transactions and selecting brokers or dealers, the
Sub-Adviser will use its best efforts to seek
on behalf of the Fund 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, the reliability,
integrity and financial condition of the broker or dealer, the size of and
difficulty in executing the order 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, 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 Fund 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 Fund. In addition, the SubAdviser 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) 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 Fund'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 Fund 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 Fund are 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 Sub-Adviser may retain
a copy of such records. In addition, for
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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 Fund's custodian on each business day
with information relating to all transactions concerning the Fund's Assets
and shall provide the Adviser with such information upon request of the
Adviser.
(f) SEI acknowledges that the Sub-Adviser performs investment advisory services
for various other clients and may give advice, and take action, with
respect to any of those other clients which may differ from the advice
given, or the timing or nature of action taken, with respect to the Fund,
provided that over a period of time the Sub-Adviser, to the extent
practical, will allocate investment opportunities to the Fund on a fair and
equitable basis relative to other similarly-situated accounts and will
attempt to minimize any dispersion of returns between the Fund and such
accounts.
SEI also acknowledges that the Sub-Adviser, its principals, employees and
affiliates, and other clients of the Sub-Adviser may have, acquire,
increase, decrease, or dispose of securities or interests therein at or
about the same time that the Sub-Adviser is purchasing or selling
securities or interests therein for the Fund which are or may be deemed to
be inconsistent with the actions taken by such persons. The Sub-Adviser
shall not have any obligations to purchase or sell, or recommend the
purchase or sale, for the Fund any securities transactions that the
Sub-Adviser, its principals, employees or affiliates, or other clients
undertake.
(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 in the Fund. The Adviser shall instruct the custodian and
other parties providing services to the Fund to promptly forward
misdirected proxies to the Sub-Adviser. The Sub-Adviser shall vote such
proxies pursuant to its Proxy Voting Policies, as amended.
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 Fund 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
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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");
(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) Prospectus(es) of the Fund.
The Adviser hereby acknowledges receipt of Sub-Adviser's Form ADV as filed with
the SEC.
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 of the Assets under
the Sub-Adviser's management and will be paid to the Sub-Adviser monthly
during the following calendar month. 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 reasonable
out-of-pocket 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
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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, or is due to errors in any prospectus
not resulting from Sub-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 reasonable out-of-pocket
expenses) howsoever arising from or in connection with the performance of
the Adviser's obligations under this Agreement; provided, however, that the
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
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.
6. 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 Fund; 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
Fund(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. Notwithstanding the foregoing, Sub- Adviser shall be entitled to
all compensation earned prior to its termination.
This Agreement shall continue in effect until September 2001, and shall
continue in force and effect from year to year thereafter, provided such
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 Fund (a) by the Fund 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 Fund, (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 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.
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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: Security Capital Global Capital Management
Group Incorporated
00 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxx
10. 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.
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 Fund 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 SEC, whether of special or general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
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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 SECURITY CAPITAL GLOBAL CAPITAL MANAGEMENT
GROUP INCORPORATED
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------------------ ------------------------------------
Name: Xxxxx Xxxxxxx Name: Xxxxxxx X. Xxxxx
------------------------------------ ------------------------------------
Title: Vice President Title: President
------------------------------------ ------------------------------------
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SCHEDULE A
TO THE
SUB-ADVISORY AGREEMENT
BETWEEN
SEI INVESTMENTS MANAGEMENT CORPORATION
AND
SECURITY CAPITAL GLOBAL CAPITAL MANAGEMENT GROUP INCORPORATED
Pursuant to Article 4, the Adviser shall pay the Sub-Adviser compensation at an
annual rate as follows:
SEI Institutional Investments Trust
Small Cap Fund 0.45% on assets under $200 million
fixed fee of $900,000/yr on assets from
$200 million to $225 million
0.40% on assets over $225 million
As an example, if the average market value of the Assets managed by the
Sub-Adviser for December 1999 were $250 million, the Adviser would owe the
Sub-Adviser a fee of $83,333.33.
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