THE PILLAR FUNDS
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 28th day of April, 1995, by and between The Pillar
Funds, a Massachusetts business trust (the "Trust"), and United Jersey Bank
Investment Management Division, a division of United Jersey Bank, (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 series of shares, each having its own investment
policies; and
WHEREAS, the Trust has retained SEI Financial Management Corporation
(the "Administrator") to provide administration of the Trust's operations,
subject to the control of the Board of Trustees;
WHEREAS, the Trust desires to retain the Adviser to render investment
advisory services with respect to its international Growth Portfolio and such
other portfolios as the Trust and the Adviser may hereafter agree upon from time
to time (the "Portfolios"), and the Adviser is willing to render such services:
NOW, THEREFORE, in consideration of mutual covenants herein contained,
and intending to be legally bound, the parties hereto agree as follows:
1. Appointment and Duties of Adviser. The Trust hereby appoints the
Adviser to provide investment advisory services to the Portfolio
for the period and on the terms set forth in this Agreement.
A. The Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided. In
the event that the Trust establishes one or more additional
portfolios in the future with respect to which it desires that the
Adviser furnish investment advisory services hereunder, the Trust
so shall notify the Adviser in writing. If the Adviser is willing
to render such services under this Agreement, it shall notify the
Trust in writing whereupon such portfolio shall become a Portfolio
hereunder and shall be subject to the provisions of this Agreement
to the same extent as the Portfolio named above in the recitals
except to the extent that said provisions (including those
relating to the compensation payable by the Trust to the Adviser)
are modified with respect to such Portfolio in writing by Trust
and the Adviser.
B. Subject to supervision by the Trust's Board of Trustees, the
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 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 Adviser shall act in conformity with the
Trust's Declaration of Trust and By-Laws and the Prospectus
and with the instructions and directions 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.
The Adviser agrees, at its own expense, to render the services and to provide
the office space, furnishings and equipment and the personnel required by it to
perform the services on the terms and for the compensation provided herein.
C. It is understood that the Adviser may from time to time employ
or associate with itself such person or persons as the Adviser may
believe to be particularly fitted to assist in the performance of
this Agreement; provided, however, that the compensation of such
person or persons shall be paid by the Adviser and that any person
providing investment advisory services to the Portfolio shall be
approved in accordance with the provisions of the 1940 Act. Each
such sub-adviser is hereinafter referred to as a "Sub-Adviser".
Notwithstanding the approval of any such Sub-Adviser(s), however, in carrying
out its obligations hereunder the Adviser shall in all events:
(a) determine, either in its sole discretion or jointly with the
Sub-Adviser(s), country and regional investment allocation
guidelines for the Portfolio, as well as investment hedging
guidelines, if any;
(b) establish and monitor general investment criteria and policies for
the Portfolio;
(c) review investments in the Portfolio on a periodic basis for
compliance with the Portfolio's investment objective, policies and
restrictions as stated in the Prospectus;
(d) review on a periodic basis the policies established by the
Sub-Adviser(s) for the Portfolio with respect to the placement of
orders for the purchase and sale of portfolio securities;
(e) review, monitor, analyze and report to the Board of Trustees on
the performance of the Sub-Adviser(s);
(f) furnish to the Board of Trustees or the Sub-Adviser(s), reports,
statistics and economic information as may be requested; and
(g) recommend, either in its sole discretion or in conjunction with
the Sub-Adviser(s), potential changes in investment policy.
2. Portfolio Transactions. The 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 and Prospectus or as the Board of Trustees
may direct from time to time, in conformity with federal
securities laws. In providing the Portfolio with investment
advisory services, the Adviser shall give primary consideration to
securing the most favorable price and efficient execution. Within
the framework of this policy, the 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
Adviser's other clients may be a party. It is understood that it
is desirable for the Portfolio that the 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
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
Adviser (or a Sub-Adviser) in connection with the Adviser's (or
Sub-Adviser's) services to other clients.
On occasions when the 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 Adviser, the 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, shall be made by the 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.
3. Compensation of the Adviser. For the services rendered by the
Adviser as provided in Sections 1 and 2 of this Agreement, the
Trust shall pay to the Adviser, and the Adviser agrees to accept
as full compensation therefor, an advisory fee at an annual rate
of 1.00% of the Portfolio's average daily net assets. The fee
shall be computed daily and paid to the Adviser monthly.
All rights of compensation under this Agreement for services
performed as of the termination date shall survive the termination
of this Agreement.
4. Other Expenses. The Adviser shall pay all expenses of preparing
(including typesetting), printing and mailing reports,
prospectuses, statements of additional information, and sales
literature to prospective clients to the extent these expenses are
not borne by the Trust under a distribution plan adopted pursuant
to Rule 12b-1.
5. Excess Expenses. If the expenses for the Portfolio 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 of the Portfolio are qualified for offer and sale,
the Adviser shall bear such excess cost.
However, the Adviser shall not bear expenses of the Portfolio
which would result in the Portfolio'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 reduction in the fee payable to the
Adviser for such month pursuant to Section 3 and, if such
reduction shall be insufficient to offset such expenses, by
reimbursing the Trust.
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.
7. Status of 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.
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 Investment Company Act of 1940 which are
prepared or maintained by the Adviser on behalf of the Trust are
the property of the Trust and shall be surrendered promptly to the
Trust on request.
9. Limitation of Liability of 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 by the Adviser or by any
Sub-Adviser in carrying out its duties hereunder or under any
sub-investment advisory agreement, except a loss resulting from
the Adviser's own willful misfeasance, bad faith or gross
negligence in the performance of its duties, or by reason of
reckless disregard by the Adviser 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 Paragraph 9, the term "Adviser" shall include
directors, officers, employees and other corporate agents (but not
the Sub-Adviser) 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, partners, officers, or shareholders, or
otherwise; directors, partners, officers, agents, and shareholders
of the Adviser are or may be interested in the Trust as Trustees,
shareholders or otherwise; and the Adviser (or any successor) is
or may be interested in the Trust as a shareholder or otherwise.
In addition, brokerage transactions for the Trust may be effected
through affiliates of the 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 shall become effective as
of the date hereof with respect to the Portfolio listed in the
recitals, and with respect to any additional Portfolio added
pursuant to Section 1 hereof, on the date of receipt by the Trust
of notice from the Adviser in accordance with said Section that
the Adviser is willing to serve as investment adviser with respect
to such Portfolio, provided that this Agreement (as supplemented
by the terms specified in any notice and agreement pursuant to
Section 1 hereof) has been approved by the shareholders of the
Portfolio in accordance with the requirements of the 1940 Act,
and, unless sooner terminated as provided herein, shall continue
in effect with respect to each Portfolio until February 28,1997.
Thereafter, if not terminated, this Agreement shall automatically
continue in effect as to a particular 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 such Portfolio; provided, however, that if
the shareholders of the Portfolio fail to approve the continuation
of its 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 Portfolio 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 Portfolio on 60 days written notice to
the Adviser, or by the Adviser at any time, without the payment of
any penalty, on 60 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 under said Act.
12. Amendment. 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 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.
13. Notice. Any notice required or permitted to be given by either
party to the other shall be delivered or mailed: if to the Trust,
at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and if to the
Adviser at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. Either party may
change its address for notices hereunder by giving notice of such
change to the other party in accordance with this Section 13.
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. Governing Law. This Agreement shall be construed in accordance
with 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.
A copy of the Declaration of Trust of the Trust is on file with the
Secretary 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.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed as of the day and year first written above.
The Pillar Funds United Jersey Bank Investment
Management Division, a
division of United Jersey Bank
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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