INVESTMENT ADVISORY AGREEMENT
SEI INDEX FUNDS
AGREEMENT made as of the 18th day of November, 1998, by and between SEI
Index Funds, a Massachusetts business trust (the "Trust"), and SEI Investments
Management Corporation, (the "Adviser").
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act"),
consisting of several portfolios of shares, each having its own investment
policies; and
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to the S&P 500 Index Fund and such other
portfolios as the Trust and the Adviser may agree upon (the "Funds"), and the
Adviser is willing to render such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained, the
parties hereto agree as follows:
1. DUTIES OF THE ADVISER. The Trust employs the Adviser to manage the
investment and reinvestment of the assets, to hire (subject to the approval of
the Trust's Board of Trustees and, except as otherwise permitted under the terms
of any exemptive relief obtained by the Adviser from the Securities and Exchange
Commission, or by rule or regulation, a majority of the outstanding voting
securities of any affected Fund(s)) and thereafter supervise the investment
activities of one or more sub-advisers deemed necessary to carry out the
investment program of any Funds of the Trust, and to continuously review,
supervise and (where appropriate) administer the investment program of the
Funds, to determine in its discretion (where appropriate) the securities to be
purchased or sold, to provide the Administrator and the Trust with records
concerning the Adviser's activities which the Trust is required to maintain, and
to render regular reports to the Administrator and to the Trust's officers and
Trustees concerning the Adviser's discharge of the foregoing responsibilities.
The retention of a sub-adviser by the Adviser shall not relieve the Adviser of
its responsibilities under this Agreement.
The Adviser shall discharge the foregoing responsibilities subject to the
control of the Board of Trustees of the Trust and in compliance with such
policies as the Trustees may from time to time establish, and in compliance with
the objectives, policies, and limitations for each such Fund set forth in the
Trust's prospectus and statement of additional information, as amended from time
to time (referred to collectively as the "Prospectus"), and applicable laws and
regulations. The Trust will furnish the Adviser from time to time with copies of
all amendments or supplements to the Prospectus, if any.
The Adviser accepts such employment and agrees, at its own expense, to render
the services and to provide the office space, furnishings and equipment and the
personnel (including any sub-advisers) required by it to perform the services on
the terms and for the compensation provided herein. The Adviser will not,
however, pay for the cost of securities, commodities, and other investments
(including brokerage commissions and other transaction charges, if any)
purchased or sold for the Trust.
2. DELIVERY OF DOCUMENTS. The Trust has furnished Adviser with copies properly
certified or authenticated of each of the following:
(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 presently in effect and as it shall from time to time be amended, is
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(s).
3. OTHER COVENANTS. The Adviser agrees that it:
(a) will comply with all applicable Rules and Regulations of the
Securities and Exchange Commission and will in addition conduct its activities
under this Agreement in accordance with other applicable law;
(b) will place orders pursuant to its investment determinations for the
Funds either directly with the issuer or with any broker or dealer. In executing
Fund transactions and selecting brokers or dealers, the 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 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 Adviser may also consider
the brokerage and research services (as those terms are defined in Section 28(e)
of the Securities Exchange Act of 1934) provided to the Fund and/or other
accounts over which the Adviser or an affiliate of the Adviser may exercise
investment discretion. The Adviser is authorized, subject to the prior approval
of the Trust's Board of Trustees, to pay to a broker or dealer who provides such
brokerage and research services a commission for executing a portfolio
transaction for any of the Funds 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 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 Adviser to the Fund.
In addition, the Adviser is authorized to allocate purchase and sale orders for
portfolio securities to brokers or dealers (including brokers and dealers that
are affiliated with the Adviser or the Trust's principal underwriter) to take
into account the sale of shares of the Trust if the 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 any Fund's
securities be purchased from or sold to the Adviser, any sub-adviser engaged
with respect to that Fund, the Trust's principal underwriter, or any affiliated
person of either the Trust, the Adviser, and sub-adviser or the
principal underwriter, acting as principal in the transaction, except to the
extent permitted by the Securities and Exchange Commission and the 1940 Act.
4. COMPENSATION OF THE ADVISER. For the services to be rendered by the Adviser
as provided in Sections 1 and 2 of this Agreement, the Trust shall pay to the
Adviser compensation at the rate(s) specified in the Schedule(s) which are
attached hereto and made a part of this Agreement. Such compensation shall be
paid to the Adviser at the end of each month, and calculated by applying a daily
rate, based on the annual percentage rates as specified in the attached
Schedule(s), to the assets of the Fund. The fee shall be based on the average
daily net assets for the month involved. The Adviser may, in its discretion and
from time to time, waive a portion of its fee.
All rights of compensation under this Agreement for services performed as of the
termination date shall survive the termination of this Agreement.
5. EXCESS EXPENSES. If the expenses for any Fund for any fiscal year
(including fees and other amounts payable to the Adviser, but excluding
interest, taxes, brokerage costs, litigation, and other extraordinary costs) as
calculated every business day would exceed the expense limitations imposed on
investment companies by any applicable statute or regulatory authority of any
jurisdiction in which Shares are qualified for offer and sale, the Adviser shall
bear such excess cost. However, the Adviser will not bear expenses of the Trust
or any Fund which would result in the Trust's inability to qualify as a
regulated investment company under provisions of the Internal Revenue Code.
Payment of expenses by the Adviser pursuant to this Section 5 shall be settled
on a monthly basis (subject to fiscal year end reconciliation) by a waiver of
the Adviser's fees provided for hereunder, and such waiver shall be treated as a
reduction in the purchase price of the Adviser's services.
6. REPORTS. The Trust and the Adviser agree to furnish to each other, if
applicable, current prospectuses, proxy statements, reports to shareholders,
certified copies of their financial statements, and such other information with
regard to their affairs as each may reasonably request. The Adviser further
agrees to furnish to the Trust, if applicable, the same such documents and
information pertaining to any sub-adviser as the Trust may reasonably request.
7. STATUS OF THE ADVISER. The services of the Adviser to the Trust are not to
be deemed exclusive, and the Adviser shall be free to render similar services to
others so long as its services to the Trust are not impaired thereby. The
Adviser shall be deemed to be an independent contractor and shall, unless
otherwise expressly provided or authorized, have no authority to act for or
represent the Trust in any way or otherwise be deemed an agent of the Trust. To
the extent that the purchase or sale of securities or other investments of any
issuer may be deemed by the Adviser to be suitable for two or more accounts
managed by the Adviser, the available securities or investments may be allocated
in a manner believed by the Adviser to be equitable to each account. It is
recognized that in some cases this may adversely affect the price paid or
received by the Trust or the size or position obtainable for or disposed by the
Trust or any Fund.
8. CERTAIN RECORDS. Any records required to be maintained and preserved
pursuant to the provisions of Rule 31a-1 and Rule 31a-2 promulgated under the
1940 Act which are prepared or maintained by the Adviser (or any sub-adviser) on
behalf of the Trust are the property of the Trust and will be surrendered
promptly to the Trust on request. The Adviser further agrees to preserve for the
periods prescribed in Rule 31a-2 under the 1940 Act the records required to be
maintained under Rule 31a-1 under the 1940 Act.
9. LIMITATION OF LIABILITY OF THE ADVISER. The duties of the Adviser shall be
confined to those expressly set forth herein, and no implied duties are assumed
by or may be asserted against the Adviser hereunder. The Adviser 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 Section 9, the term "Adviser" shall include directors,
officers, employees and other corporate agents of the Adviser as well as that
corporation itself).
10. PERMISSIBLE INTERESTS. Trustees, agents, and shareholders of the Trust are
or may be interested in the Adviser (or any successor thereof) as directors,
part-ners, officers, or shareholders, or otherwise; directors, partners,
officers, agents, and shareholders of the Adviser are or may be interested in
the Trust as Trustees, officers, shareholders or otherwise; and the Adviser (or
any successor) is or may be interested in the Trust as a shareholder or
otherwise subject to the provisions of applicable law. All such interests shall
be fully disclosed between the parties on an ongoing basis and in the Trust's
Prospectus as required by law. In addition, brokerage transactions for the Trust
may be effected through affiliates of the Adviser or any sub-adviser if
approved by the Board of Trustees, subject to the rules and regulations of the
Securities and Exchange Commission.
11. DURATION AND TERMINATION. This Agreement, unless sooner terminated as
provided herein, shall remain in effect until two years from date of
execution, and thereafter, for periods of one year so long as such
continuance thereafter is specifically approved at least annually (a) by the
vote of a majority of those Trustees of the Trust who are not parties to this
Agreement or interested persons of any such party, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by the
Trustees of the Trust or by vote of a majority of the outstanding voting
securities of each Fund; provided, however, that if the shareholders of any
Fund fail to approve the Agreement as provided herein, the Adviser may
continue to serve hereunder in the manner and to the extent permitted by the
1940 Act and 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.
This Agreement may be terminated as to any Fund at any time,
without the payment of any penalty by vote of a majority of the Trustees of
the Trust or by vote of a majority of the outstanding voting securities of
the Fund on not less than 30 days nor more than 60 days
written notice to the Adviser, or by the Adviser at any time without the
payment of any penalty, on 90 days written notice to the Trust. This
Agreement will automatically and immediately terminate in the event of its
assignment.
As used in this Section 11, the terms "assignment", "interested
persons", and a "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 exemptions as may be granted by
the Securities and Exchange Commission.
12. 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.
13. 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
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Legal Department
To the Trust at:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Legal Department
14. SEVERABILITY. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby.
15. 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 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 Trust.
No Fund of the Trust shall be liable for the obligations of any other Fund of
the Trust. Without limiting the generality of the foregoing, the Adviser shall
look only to the assets of a particular Fund for payment of fees for services
rendered to that Fund.
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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first written above.
SEI Index Funds SEI Investments Management Corporation
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President Title: Vice President
SCHEDULE A
TO THE
INVESTMENT ADVISORY AGREEMENT
BETWEEN
SEI INDEX FUNDS
AND
SEI INVESTMENTS MANAGEMENT CORPORATION
Pursuant to Article 4, the Trust shall pay the Adviser compensation at an
annual rate as follows:
S&P 500 Index Fund .03%
