INVESTMENT ADVISORY AGREEMENT
SEI DAILY INCOME TRUST
AGREEMENT made this 17th day of March, 2003, by and between SEI Daily
Income Trust, 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, each having its own investment policies; and
WHEREAS, the Trust desires to retain the Adviser to render investment
management services with respect to its portfolios, as listed on attached
Schedule A, (each a "Fund" and, collectively, 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 U.S.
Securities and Exchange Commission (the "SEC"), 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 Trust's administrator (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 the 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 SEC 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 portfolio 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
if 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 SEC 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 a 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
and Federal 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, 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, 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 Funds 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
SEC.
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
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Attn: Legal Department
To the Trust at: SEI Daily Income Trust
c/o SEI Investments
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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 SEC, 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 Daily Income Trust SEI Investments Management Corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Attest: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Attest: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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SCHEDULE A
TO THE INVESTMENT ADVISORY AGREEMENT
BETWEEN
SEI DAILY INCOME TRUST
AND
SEI INVESTMENTS MANAGEMENT CORPORATION
AS OF MARCH 17, 2003
Money Market Fund
Prime Obligation Fund
Government Fund
Government II Fund
Treasury Fund
Treasury II Fund
Federal Securities Fund
SCHEDULE B
TO THE INVESTMENT ADVISORY AGREEMENT
BETWEEN
SEI DAILY INCOME TRUST
AND
SEI INVESTMENTS MANAGEMENT CORPORATION
AS OF MARCH 17, 2003
Pursuant to Article 4, the Trust shall pay the Adviser compensation at an annual
rate as follows:
0.75% on the first $500 million of assets and 0.02% on the assets in excess of
$500 million. The fee will be calculated based on the combined assets of the
Funds managed by the Adviser.
FUNDS:
Money Market Fund
Prime Obligation Fund
Government Fund
Government II Fund
Treasury Fund
Treasury II Fund
Federal Securities Fund
AGREED AND ACCEPTED:
SEI Daily Income Trust SEI Investments Management Corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Attest: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Attest: /s/ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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