ADMINISTRATION AGREEMENT
THIS AGREEMENT is made as of this 28th day of February, 1992, by and
between The Pillar Funds (the "Trust") a Massachusetts business trust, and SEI
Financial Management Corporation (the "Administrator"), a Delaware corporation.
WHEREAS, the Trust is an open-end diversified management investment
company registered under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, the Trust desires the Administrator to provide, and the
Administrator is willing to provide management, administrative, transfer agent
and shareholder servicing services to the Trust's U.S. Treasury Securities Money
Market, Prime Obligation Money Market, Tax-Exempt Money Market, Short-Term
Investment, Fixed Income, New Jersey Municipal Securities, Intermediate-Term
Government Securities, Equity Growth, Equity Income, Equity Aggressive Growth
and Balanced Growth Portfolios and such other portfolios as the Trust and the
Administrator may agree on (the "Portfolios"), on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Trust and the Administrator hereby agree as follows:
ARTICLE 1. Retention of the Administrator. The Trust hereby retains the
Administrator to act as the Administrator and Shareholder Servicing Agent of the
Portfolios and to furnish the Portfolios with the management, administrative,
transfer agent and shareholder servicing services as set forth below. The
Administrator hereby accepts such employment to perform the duties set forth
below.
The Administrator shall, for all purposes herein, be deemed to be an
independent contractor and, unless otherwise expressly provided or authorized,
shall have no authority to act for or represent the Trust in any way and shall
not be deemed an agent of the Trust.
ARTICLE 2. Transfer Agent Services. The Administrator will act as
Transfer Agent for the Portfolios' institutional accounts and, as such, will
record in an account (the "Account") the total number of units of beneficial
interest ("Shares") of each Portfolio issued and outstanding from time to time
and will maintain Share transfer records in which it will note the names and
registered addresses of Shareholders, and the number of Shares from time to time
owned by each of them. Each Shareholder will be assigned one or more account
numbers.
The Administrator is authorized to set up accounts and record
transactions in the accounts on the basis of instructions received from
Shareholders when accompanied by remittance in appropriate amount as provided in
the Trust's then current prospectus. The Trust will not issue certificates
representing its Shares. Whenever Shares are purchased or issued, the
Administrator shall credit the Account with the Shares issued, and credit the
proper number of Shares to the appropriate Shareholder.
Likewise, whenever the Administrator has occasion to redeem Shares
owned by a Shareholder, the Trust authorizes the Administrator to process the
transaction by making appropriate entries in its Share transfer records and
debiting the Account.
Upon notification by the Trust's Custodian of the receipt of funds
through the Federal Reserve wire system or conversion into Federal funds of
funds transmitted by other means for the purchase of Shares in accordance with
the Trust's current prospectus, the Administrator shall notify the Trust of such
deposits on a daily basis.
The Administrator shall credit each Shareholder's account with the
number of shares purchased according to the price of the Shares in effect for
such purchases determined in the manner set forth in the Trust's then current
prospectus. The Administrator shall process each order for the redemption of
Shares from or on behalf of a Shareholder, and shall cause cash proceeds to be
wired in Federal funds.
The requirements as to instruments of transfer and other documentation,
the applicable redemption price and the time of payment shall be as provided in
the then current prospectus, subject to such supplemental requirements
consistent with such prospectus as may be established by mutual agreement
between the Trust and Administrator.
If the Administrator or the Trust determines that a request for
redemption does not comply with the requirements for redemption, the
Administrator shall promptly so notify the Shareholder, together with the reason
therefor, and shall effect such redemption at the price next determined after
receipt of documents complying with said standards.
On each day that the Trust's Custodian and the New York Stock Exchange
are open for business ("Business Day"), the Administrator shall notify the
Custodian of the amount of cash or other assets required to meet payments made
pursuant to the provisions of this Article 2, and the Trust shall instruct the
Custodian to make available from time to time sufficient funds or other assets
therefor.
The authority of the Administrator to perform its responsibilities as
to purchases
and redemptions under this Article 2 shall be suspended upon receipt by
it of notification from the Securities and Exchange Commission or the Trustees
of the suspension of the determination of the Trust's net asset value.
In registering transfers, the Administrator may rely upon an opinion of
counsel in not requiring complete documentation, in registering transfers
without inquiry into adverse claims, in delaying registration for purposes of
such inquiry, or in refusing registration where in its judgment an adverse claim
requires such refusal.
The Trust warrants that it has or shall deliver to the Administrator,
as transfer agent:
(a) a copy of the Declaration of Trust of the Trust, incorporating all
amendments thereto, certified by the Secretary or Assistant
Secretary of the Trust;
(b) an opinion of counsel to the Trust with respect to (i) the
legality and continuing existence of the Trust, (ii) the legality
of its outstanding Shares of beneficial interest, and (iii) the
number of Shares authorized for issuance and stating that upon
issuance they will be validly issued and non-assessable; and
(c) the Trust's Secretary's or Assistant Secretary's certificate as to
the authorized outstanding Shares of the Trust, its address to
which notices may be sent, the names and specimen signatures of
its officers who are authorized to sign instructions or requests
to the Administrator on behalf of the Trust, and the name and
address of legal counsel to the Trust. In the event of any future
amendment or change in respect of any of the foregoing, prompt
written notification of such change shall be given by the Trust to
the Administrator, together with copies of all relevant
resolutions, instruments or other documents, specimen signatures,
certificates, opinions or the like as the Administrator may deem
necessary or appropriate.
ARTICLE 3. Dividend Disbursing Agent. The Administrator shall act as
Dividend Disbursing Agent for the Trust's institutional accounts and, as such,
in accordance with the provisions of the Trust's Declaration of Trust and then
current prospectus, shall prepare and wire or credit income and capital gains
distributions to Shareholders (or instruct the Custodian to do so) after
deducting any amount required to be withheld by any applicable tax laws, rules
and regulations or other applicable rules or regulations.
The Trust agrees that it shall promptly inform the Administrator of the
declaration of any dividend or distribution on its Shares, and that on or before
the payment date of a distribution, it shall instruct the Custodian to make
available, at the instruction of the Dividend Disbursing Agent, sufficient funds
for the cash amount to be paid out. If a Shareholder is entitled to receive
additional Shares by virtue of any such distribution or dividend, appropriate
credits will be made to the Shareholder's account.
ARTICLE 4. Other Administrative Services. In addition to the services
described above, the Administrator shall perform or supervise the performance by
others of other administrative services in connection with the operations of the
Portfolios, and, on behalf of the Trust, will investigate, assist in the
selection of and conduct relations with custodians, depositories, accountants,
underwriters, brokers and dealers, corporate fiduciaries, insurers, banks and
persons in any other capacity deemed to be necessary or desirable for the
Portfolios' operation. The Administrator shall provide the Trustees of the Trust
with such reports regarding investment performance as they may reasonably
request but shall have no responsibility for supervising the performance by any
investment adviser or sub-adviser of its responsibilities.
The Administrator shall provide the Trust with regulatory reporting,
fund accounting and related portfolio accounting services, all necessary office
space, equipment, personnel compensation and facilities (including facilities
for Shareholders' and Trustees' meetings) for handling the affairs of the
Portfolios and such other services as the Administrator shall, from time to
time, determine to be necessary to perform its obligations under this Agreement.
The Administrator shall make reports to the Trust's Trustees concerning
the performance of its obligations hereunder; furnish advice and recommendations
with respect to other aspects of the business and affairs of the Portfolios as
the Trust and the Administrator shall determine desirable; and shall provide the
Portfolios' Shareholders with the reports described in the Trust's current
prospectus.
The Administrator shall calculate the daily net asset value of the
Portfolios in accordance with the procedures prescribed in the Trust's
Registration Statement and such other procedures as may be established by the
Trustees of the Trust.
Also, the Administrator will perform other services for the Trust as
agreed from time to time, including, but not limited to, preparation and mailing
of appropriate federal income tax forms and returns to the Internal Revenue;
mailing the annual reports of the Trust; preparing an annual list of
institutional Shareholders; furnishing the Trust with such reports regarding the
sale and redemption of Shares as may be
required in order to comply with federal and state securities law; and
mailing notices of Shareholders' meetings, proxies and proxy statements to
institutional Shareholders, for all of which the Trust will pay the
Administrator's out-of-pocket expenses.
ARTICLE 5. Allocation of Charges and Expenses.
(A) The Administrator. The Administrator shall furnish at its own
expense the executive, supervisory and clerical personnel
necessary to perform its obligations under this Agreement. The
Administrator shall also provide the items which it is obligated
to provide under this Agreement, and shall pay all compensation,
if any, of officers of the Trust as well as all Trustees of the
Trust who are affiliated persons of the Administrator or any
affiliated corporation; provided, however, that unless otherwise
specifically provided, the Administrator shall not be obligated to
pay the compensation of any employee of the Trust retained by the
Trustees of the Trust to perform services on behalf of the Trust.
(B) The Trust. The Trust assumes and shall pay or cause to be paid all
other expenses of the Trust not otherwise allocated herein,
including, without limitation, organizational costs, taxes,
expenses for legal and auditing services, the expenses of
preparing (including typesetting), printing and mailing reports,
prospectuses, statements of additional information, proxy
solicitation material and notices to existing Shareholders, all
expenses incurred in connection with issuing and redeeming Trust
Shares, the costs of custodial services, the cost of initial and
ongoing registration of the Trust's Shares under federal and state
securities laws, fees and out-of-pocket expenses of Trustees who
are not affiliated persons of the Administrator or any affiliated
corporation, insurance, interest, brokerage costs, litigation and
other extraordinary or nonrecurring expenses, all fees and charges
of investment advisers to the Trust. In addition, the Trust will
bear distribution expenses in accordance with the Trust's
Distribution Plan.
ARTICLE 6. Compensation of the Administrator.
(A) Administration Fee. For the services to be rendered, the
facilities furnished and the expenses assumed by the Administrator
pursuant to this Agreement, the Trust shall pay to the
Administrator compensation at an annual rate specified in the
schedules which are attached hereto and made a part of this
Agreement ("Schedules"). Such compensation shall be calculated and
accrued daily, and paid to the Administrator monthly.
If this Agreement becomes effective subsequent to the first day of
a month or terminates before the last day of a month, the
Administrator's compensation for that part of the month in which
this Agreement is in effect shall be prorated in a manner
consistent with the calculation of the fees as set forth above.
Payment of the Administrator's compensation for the preceding
month shall be made promptly.
(B) Compensation from Transactions. The Trust hereby authorizes any
entity or person associated with the Administrator which is a
member of a national securities exchange to effect any transaction
on the exchange for the account of the Trust which is permitted by
Section 11(a) of the Securities Exchange Act of 1934 and Rule
lla2-2(T) thereunder, and the Trust hereby consents to the
retention of compensation for such transactions in accordance with
Rule 11a2-2(T)(a)(2)(iv).
(C) Survival of Compensation Rights. All rights of compensation under
this Agreement for services performed as of the termination date
shall survive the termination of this Agreement.
ARTICLE 7. Limitation of Liability of the Administrator. The duties of
the Administrator shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the Administrator
hereunder. The Administrator shall not be liable for any error of judgment or
mistake of law or for any loss arising out of any investment or for any act or
omission in carrying out its duties hereunder, except a loss resulting from
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of reckless disregard of its obligations and duties
hereunder, except as may otherwise be provided under provisions of applicable
state law which cannot be waived or modified hereby. (As used in this Article 7,
the term "Administrator" shall include directors, officers, employees and other
corporate agents of the Administrator as well as that corporation itself.)
So long as the Administrator acts in good faith and with due diligence
and without gross negligence, the Trust assumes full responsibility and shall
indemnify the Administrator and hold it harmless from and against any and all
actions, suits and claims, whether groundless or otherwise, and from and against
any and all losses, damages, costs, charges, reasonable counsel fees and
disbursements, payments, expenses and liabilities (including reasonable
investigation expenses) arising directly or indirectly out of said
administration, transfer agency, and dividend disbursing relationships to the
Trust or any other service rendered to the Trust hereunder. The
indemnity and defense provisions set forth herein shall indefinitely
survive the termination of this Agreement.
The rights hereunder shall include the right to reasonable advances of
defense expenses in the event of any pending or threatened litigation with
respect to which indemnification hereunder may ultimately be merited. In order
that the indemnification provision contained herein shall apply, however, it is
understood that if in any case the Trust may be asked to indemnify or hold the
Administrator harmless, the Trust shall be fully and promptly advised of all
pertinent facts concerning the situation in question, and it is further
understood that the Administrator will use all reasonable care to identify and
notify the Trust promptly concerning any situation which presents or appears
likely to present the probability of such a claim for indemnification against
the Trust, but failure to do so in good faith shall not effect the rights
hereunder.
The Administrator may apply to the Trust at any time for instructions
and may consult counsel for the Trust or its own counsel and with accountants
and other experts with respect to any matter arising in connection with the
Administrator's duties, and the Administrator shall not be liable or accountable
for any action taken or omitted by it in good faith in accordance with such
instruction or with the opinion of such counsel, accountants or other experts.
Also, the Administrator shall be protected in acting upon any document
which it reasonably believes to be genuine and to have been signed or presented
by the proper person or persons. Nor shall the Administrator be held to have
notice of any change of authority of any officers, employee or agent of the
Trust until receipt of written notice thereof from the Trust.
ARTICLE 8. Activities of the Administrator. The services of the
Administrator rendered to the Trust are not to be deemed to be exclusive. The
Administrator is free to render such services to others and to have other
businesses and interests. It is understood that Trustees, officers, employees
and Shareholders of the Trust are or may be or become interested in the
Administrator, as directors, officers, employees and shareholders or otherwise
and that directors, officers, employees and shareholders of the Administrator
and its counsel are or may be or become similarly interested in the Trust, and
that the Administrator may be or become interested in the Trust as a Shareholder
or otherwise.
ARTICLE 9. Duration of This Agreement. This Agreement shall remain in
effect for five years after the date of the Agreement and shall continue in
effect for successive periods of two years subject to review at least annually
by the Trustees.
In the event of a material breach of this Agreement by either party,
the non-breaching party shall notify the breaching party in writing of such
breach and upon
receipt of such notice, the breaching party shall have 45 days to
remedy the breach or the non-breaching party may terminate this Agreement
immediately.
This Agreement shall not be assignable by either party without the
written consent of the other party.
ARTICLE 10. Amendments. This Agreement may be amended by the parties
hereto only if such amendment is specifically approved (i) by the vote of a
majority of the Trustees of the Trust, and (ii) by the vote of a majority of the
Trustees of the Trust who are not parties to this Agreement or interested
persons of any such party, cast in person at a Board of Trustees meeting called
for the purpose of voting on such approval.
For special cases, the parties hereto may amend such procedures set
forth herein as may be appropriate or practical under the circumstances, and the
Administrator may conclusively assume that any special procedure which has been
approved by the Trust does not conflict with or violate any requirements of its
Declaration of Trust, By-Laws or prospectus, or any rule, regulation or
requirement of any regulatory body.
ARTICLE 11. Trustees' Liability. A copy of the 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 not individually and that
the obligations of this instrument are not binding upon any of the Trustees,
officers or Shareholders of the Trust individually, but binding only upon the
assets and property of the Trust.
ARTICLE 12. Certain Records. The Administrator shall maintain customary
records in connection with its duties as specified in this Agreement. Any
records required to be maintained and preserved pursuant to Rules 31a-1 and
31a-2 under the 1940 Act which are prepared or maintained by the Administrator
on behalf of the Trust shall be prepared and maintained at the expense of the
Administrator, but shall be the property of the Trust and will be made available
to or surrendered promptly to the Trust on request.
In case of any request or demand for the inspection of such records by
another party, the Administrator shall notify the Trust and follow the Trust's
instructions as to permitting or refusing such inspection; provided that the
Administrator may exhibit such records to any person in any case where it is
advised by its counsel that it may be held liable for failure to do so, unless
(in cases involving potential exposure only to civil liability) the Trust has
agreed to indemnify the Administrator against such liability.
ARTICLE 13. Definitions of Certain Terms. The terms "interested person"
and "affiliated person", when used in this Agreement, shall have the respective
meanings
specified in the 1940 Act and the rules and regulations thereunder,
subject to such exemptions as may be granted by the Securities and Exchange
Commission.
ARTICLE 14. Notice. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, postage prepaid, addressed by the party giving notice to the
other party at the last address furnished by the other party to the party giving
notice: if to the Trust, at 000 Xxxx Xxxxxxxxxx Xxxx, Xxxxx, XX, and if to the
Administrator at 000 Xxxx Xxxxxxxxxx Xxxx, Xxxxx, XX.
ARTICLE 15. Governing Law. This Agreement shall be construed in
accordance with the laws of the Commonwealth of Massachusetts and the applicable
provisions of the 1940 Act. To the extent that the applicable laws of the
Commonwealth of Massachusetts, or any of the provisions herein, conflict with
the applicable provisions of the 1940 Act, the latter shall control.
ARTICLE 16. Multiple Originals. This Agreement may be executed in two
or more counterparts, each of which when so executed shall be deemed to be an
original, but such counterparts shall together constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
THE PILLAR FUNDS
By: /s/ [ILLEGIBLE SIGNATURE]
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SEI FINANCIAL MANAGEMENT COMPANY
By: /s/ [ILLEGIBLE SIGNATURE]
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SCHEDULE A
TO THE ADMINISTRATION AGREEMENT
DATED FEBRUARY 28, 1992
BETWEEN
THE PILLAR FUNDS
AND
SEI FINANCIAL MANAGEMENT CORPORATION
Pursuant to Article 6, Section A, the Trust shall pay the Administrator
compensation which is calculated daily and paid monthly at an annual rate as
follows:
.20% of average daily net assets of each Portfolio.
