Draft 7/2/99
SA FUNDS - INVESTMENT TRUST
INVESTMENT SUB-ADVISORY AGREEMENT
AGREEMENT executed as of July , 1999 by and among SA FUNDS
-INVESTMENT TRUST (THE "TRUST"), RWB ADVISORY SERVICES ("RWBAS") and
DIMENSIONAL FUND ADVISORS INC., a Delaware corporation and registered
investment adviser ("Sub-Adviser").
WHEREAS, RWBAS is the investment manager for the Trust, an
open-end management investment company registered under the Investment
Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, RWBAS desires to retain Sub-Adviser as agent to furnish
investment advisory services to the investment portfolios of the Trust listed
on Schedule A hereto and Sub-Adviser has agreed to act in such capacity (each
a "Fund" and collectively the "Funds").
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
1. APPOINTMENT. RWBAS hereby appoints Sub-Adviser to provide
sub-investment advisory services to the Funds for the period and on the terms
set forth in this Agreement. Sub-Adviser accepts such appointment and agrees
to furnish the services herein set forth for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. RWBAS has furnished Sub-Adviser with
copies properly certified or authenticated of each of the following:
(a) the Trust's Declaration of Trust, as filed with the
Secretary of State of Delaware and all amendments thereto or
restatements thereof (such Declaration of Trust, as presently in effect
and as it shall from time to time be amended or restated, is herein
called the "Declaration of Trust");
(b) the Trust's By-Laws and amendments thereto;
(c) resolutions of the Trust's Board of Trustees authorizing
the appointment of Sub-Adviser and approving this Agreement;
(d) the Trust's Notification of Registration on Form N-8A
under the 1940 Act as filed with the Securities and Exchange Commission
(the "SEC") on January 11, 1999 and all amendments thereto;
(e) the Trust's Registration Statement on Form N-lA under the
Securities Act of 1933, as amended ("1933 Act") (File No. 33-70423) and
under the 1940 Act (File No. 811-09195) as filed with the SEC and all
amendments thereto insofar as such Registration Statement and such
amendments relate to the Funds; and
(f) the Trust's most recent prospectus and Statement of
Additional Information for the Funds (such prospectus and Statement of
Additional Information, as presently in effect, and all amendments and
supplements thereto, are - herein collectively called the
"Prospectus").
RWBAS will furnish the Sub-Adviser from time to time with
copies of all amendments of or supplements to the foregoing.
3. MANAGEMENT. Subject always to the supervision of Trust's Board of
Trustees and RWBAS, the Sub-Adviser will furnish an investment program in
respect of, and make investment decisions for, all assets of the Funds and
place all orders for the purchase and sale of securities, all on behalf of
the Funds. In the performance of its duties, the Sub-Adviser will satisfy its
fiduciary duties to the Funds and will monitor the Funds' investments, and
will comply with the provisions of Trust's Declaration of Trust and By-Laws,
as amended from time to time, and the stated investment objectives, policies
and restrictions of the Funds as contained in the Prospectus. The Sub-Adviser
and RWBAS will make their officers and employees available to the other from
time to time at reasonable times to review investment policies of the Funds
and to consult with each other regarding the investment affairs of the Funds.
The Sub-Adviser will report to the Board of Trustees and RWBAS to with
respect to the implementation of such program.
The Sub-Adviser further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to fiduciary accounts for
which it has investment responsibilities;
(b) will conform with all applicable U.S. rules and
regulations pertaining to its investment advisory activities;
(c) will place orders pursuant to its investment
determinations for the Funds either directly with the issuer or with
any broker or dealer. The Sub-Adviser will place orders for the
purchase or sale of securities with a view to receiving the best price
and execution for such purchase or sale. Where the Sub-Adviser places
orders for the purchase or sale of securities for the Funds, in
selecting brokers or dealers to execute such orders, the Sub-Adviser is
expressly authorized to consider the fact that a broker or dealer has
been or will be furnishing research or other information or services
which assist the Sub-Adviser's performance of its investment
decision-making responsibilities generally, provided that the
commission cost is reasonable in relation to the brokerage and research
services provided. Compensation received by the Sub-Adviser pursuant to
this Agreement shall not be reduced by any benefits received by the
Sub-Adviser pursuant to this section. The Sub-Adviser may direct
brokerage to whomever it deems appropriate consistent with the
foregoing. In no instance will portfolio securities be purchased from
or sold to RWBAS or any of its affiliated brokers or dealers, the
Sub-Adviser or any affiliated person of either the Trust, RWBAS or
Sub-Adviser, except as may be permitted under the 1940 Act;
(d) will report regularly to RWBAS and to the Board of
Trustees and will make appropriate persons available for the purpose of
reviewing with representatives of RWBAS and the Board of Trustees on a
regular basis at reasonable times the management of the Funds,
including, without limitation, review of the general investment
strategy of the Funds, the performance of the Funds in relation to
standard industry indices, interest rate considerations and
general conditions affecting the marketplace and will provide various
other reports from time to time as reasonably requested by RWBAS;
(e) will maintain books and records with respect to Trust's
securities transactions and will furnish RWBAS and the Trust's Board of
Trustees such periodic and/or special reports as the Board or RWBAS may
request;
(f) will act upon instructions from RWBAS not inconsistent
with its fiduciary duties hereunder;
(g) will treat confidentially and as proprietary information
of Trust all such records and other information relative to Trust
maintained by the Sub-Adviser, and will 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 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 proceedings for failure to
comply, when requested to divulge such information by duly constituted
authorities, or when so requested by Trust;
(h) will receive the research and recommendations of RWBAS
with respect to the investment and reinvestment of the assets of the
Funds; and
(i) will vote proxies received by the Sub-Adviser in
connection with securities held by the Funds consistent with its
fiduciary duties hereunder.
4. RWBAS'S DUTIES. RWBAS shall continue to have responsibility for
all other services to be provided to the Funds pursuant to its Investment
Management Agreements and shall oversee and review the Sub-Adviser's
performance of its duties under this Agreement. The Advisor shall also retain
direct portfolio management responsibility with respect to any assets of the
Series which are not allocated by it to the portfolio management of the
Sub-Adviser.
5. REFERENCES TO SUB-ADVISER. During the term of this Agreement,
RWBAS agrees to furnish to the Sub-Adviser at its principal office all
prospectuses, proxy statements, reports to stockholders, sales literature or
other material prepared for distribution to sales personnel, shareholders of
the Fund or the public, which refer to the Sub-Adviser or its clients in any
way, prior to use thereof and not to use such material if the Sub-Adviser
reasonably objects in writing five business days (or such other time as may
be mutually agreed upon) after receipt thereof. Sales literature may be
furnished to the Sub-Adviser hereunder by first-class or overnight mail,
facsimile transmission equipment or hand delivery, attn: Legal Department.
6. BOOKS AND RECORDS. In compliance with the requirements of Rule
3la-3 under the 1940 Act, the Sub-Adviser hereby agrees that all records
which it maintains for the Trust are the property of the Trust and further
agrees to surrender promptly to the Trust any of such records upon the
Trust's request. Sub-Adviser further agrees to maintain the records required
to be maintained by subsections (b)(1), (b)(5), (b)(9), (b)(10), (b)(11), (e)
and (f) of Rule 3la-1 under the 1940 Act and preserve them for the periods
prescribed by Rule 3la-2 under the 1940 Act.
7. EXPENSES. During the term of this Agreement, Sub-Adviser will pay
all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities
(including brokerage commissions, custodial fees and expenses and stamp
duties, if any) purchased for the Funds.
8. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, RWBAS Investment Trust will pay the Sub-Adviser,
and the Sub-Adviser agrees to accept as full compensation therefor, a
sub-advisory fee, accrued daily and payable monthly, in accordance with
SCHEDULE A hereto.
9. Services to Others. Subject to exclusivity clauses in the DFA
Services Agreement, RWBAS understands, and has advised Trust's Board of
Trustees, that the Sub-Adviser now acts, and may in the future act, as an
investment adviser to fiduciary and other managed accounts, and as investment
adviser, sub-investment adviser, and/or administrator to other investment
companies. RWBAS has no objection to the Sub-Adviser's acts in such
capacities, provided that whenever one or more of the Funds and one or more
other investment companies or accounts advised by Sub-Adviser have available
funds for investment, investments suitable and appropriate for each will be
allocated in accordance with a manner believed by the Sub-Adviser to be
equitable consistent with its fiduciary obligations to the Funds and such
other investment entities. RWBAS recognizes, and has advised Trust's Board of
Trustees, that in some cases this procedure may adversely affect the size of
the position that the participating Fund(s) may obtain in a particular
security. In addition, RWBAS understands, and has advised Trust's Board of
Trustees, that the persons employed by the Sub-Adviser to assist in the
Sub-Adviser's duties under this Agreement will not devote their full time to
such service and nothing contained in this Agreement will be deemed to limit
or restrict the right of the Sub-Adviser or any of its affiliates to engage
in and devote time and attention to other businesses or to render services of
whatever kind or nature.
10. CLIENT SUITABILITY. RWBAS understands and agrees that the
Sub-Adviser, as part of its duties hereunder, is not responsible for
determining whether or not any of the Funds are suitable and appropriate
investments for the clients who invest in such Funds.
11. LIMITATION OF LIABILITY. RWBAS will not take any action against
the Sub-Adviser to hold the Sub-Adviser liable for any error of judgment or
mistake of law or for any loss suffered by the Fund in connection with the
performance of the Sub-Adviser's duties under this Agreement, except a loss
resulting from the Sub-Adviser's willful misfeasance, bad faith, or gross
negligence in the performance of its duties under this Agreement.
12. INDEMNIFICATION. RWBAS and the Sub-Adviser each agree to
indemnify the other against any claim against, loss or liability to such
other party (including reasonable attorneys fees) arising out of any action
on the part of the indemnifying party which constitutes willful misfeasance,
bad faith or gross negligence.
13. DURATION AND TERMINATION. This Agreement will become effective
as to each Fund as to the date set forth opposite each Fund's name on
SCHEDULE A, provided that it has been approved by a vote of a majority of the
outstanding voting securities of such Fund in accordance with the
requirements under the 1940 Act and, unless sooner terminated as provided
herein, will continue in effect for two (2) years from such date.
Thereafter, if not terminated as to a Fund, this Agreement will
continue in effect as to a Fund for successive periods of twelve (12) months,
PROVIDED that such continuation 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 the Trust, the Sub-Adviser, or RWBAS, 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 such Fund. Notwithstanding the foregoing, this Agreement may be
terminated as to the Fund at any time, without the payment of any penalty, on
sixty (60) days' written notice by the Trust. Once this Agreement has been in
effect for a period of not less than one (1) year, then unless otherwise
terminated in accordance with the foregoing, this Agreement may be terminated
by RWBAS or by the Sub-Adviser, as to all Funds, by giving not less than
sixty (60) days' notice. This Agreement will immediately terminate in the
event of its assignment. (As used in this Agreement, the terms "majority of
the outstanding voting securities", "interested persons" and "assignment"
have the same meaning of such terms in the 1940 Act.)
14. AMENDMENT OF THIS AGREEMENT. No provision this Agreement may be
changed, waived, discharged or, terminated orally, but only by an instrument
in writing signed by the party against which enforcement of the change,
waiver, discharge or termination is sought.
15. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement is held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement will not be
affected thereby. This Agreement will be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and will be
governed by the laws of the State of California.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers designated below as of the day and year
first above written.
SA FUNDS - INVESTMENT TRUST
By:
Name:
Title:
DIMENSIONAL FUND ADVISORS INC.
By:
Name:
Title:
RWB ADVISORY SERVICES INC.
By:
Name:
Title:
SCHEDULE A
Fund Fee
---- ---
SA Fixed Income Fund 19.24 basis points annually
SA U.S. Market Fund 4.62 basis points annually
SA U.S. HBTM Fund 26.94 basis points annually
SA U.S. Small Company Fund 38.48 basis points annually
SA International HBTM Fund 38.48 basis points annually
SA International Small Company Fund 28.48 basis points annually
SA FUNDS - INVESTMENT TRUST
By:
Name:
Title:
DIMENSIONAL FUND ADVISORS INC.
By:
Name:
Title:
RWB ADVISORY SERVICES INC.
By:
Name:
Title:
